In last week’s blog, I mentioned the potential impact of a Copenhagen Protocol coming out of the upcoming December summit on companies’ long-term carbon emissions planning.  One of the questions I received back on that post asked what might happen if the Copenhagen Protocol doesn’t pass.  What impact would something like that have on the energy supply?  Does energy become a new, high-value currency?  If so, what options do companies, and countries for that matter, have open to them?

The UK is facing this very real threat in the next few years, independent of the Copenhagen Protocol.  Recently, the TimesOnline reported that Britain’s energy regulator is forecasting a power supply reduction in the UK in the next four years.  The country is scrambling to renovate its power infrastructure ahead of a new EU pollution rule resulting in the potential closure of a quarter of UK power stations by 2015.  Until new power stations are up and running, the UK is at great risk for not having enough energy to meet customer demand for a four to five year time period.  As a result, Britain will be more vulnerable to energy supply shocks than any other major country in Europe.

So what can companies do now to minimize the impact of either one of these scenarios? One option is to look at off-shore locations for their most power-hungry IT infrastructure needs, i.e. data centers.  I discussed this strategy a few months back in my posting about Emergency Power Strategies, and utilizing a remote location for a company’s data center can mitigate the risks involved in the energy supply chain.  When you look at an off-shore location like Iceland, you not only minimize the exposure to local energy supply and potential pricing issues, but a company can also reap additional benefits like stable energy pricing and renewable energy sources.  It almost seems too good to be true – reduce risk, go green and save money. 

With these very serious energy issues facing CIOs today, companies are going to have to re-evaluate their power supply strategies, and looking to someplace like Iceland might just be the answer.