Internet Boosting Energy Efficiency

By Joseph Romm, Grist.org. Posted June 27, 2000.

The emerging new economy created by the Internet is producing more than just a business revolution -- it is also generating enormous environmental benefits. The Internet can turn buildings into websites, and replace warehouses with supply-chain software. It can turn paper and CDs into electrons, and replace trucks with fiberoptic cable. This means significant energy savings, and perhaps a very different type of economic growth than we have seen in the past.

By reducing the amount of energy and materials consumed by business, often dramatically, and by increasing overall productivity, the Internet stands to revolutionize the relationship between economic growth and the environment, according to a new report we've produced at the Center for Energy and Climate Solutions. There's already evidence of a sudden shift in the American energy diet. While the nation's economy grew by more than 9 percent in 1997 and 1998, energy demand stayed almost flat in spite of very low energy prices, marking a major departure from recent historical patterns.

Part of this trend can be attributed to the growth of information technology and e-commerce. For example, for each book sold, the online retailer Amazon.com uses just one-sixteenth the energy to operate its buildings that a traditional bookseller uses. Internet shopping also uses less energy to get a package to your house. Shipping a 10-pound package by overnight air -- the most energy-intensive delivery mode -- uses 40 percent less fuel than the average roundtrip drive to the mall. Ground shipping by truck uses just one-tenth the energy of a trip by car to the store.

In fact, each minute spent driving to the mall uses more than 20 times the energy of a minute spent shopping on the Internet. Online shopping eliminates the need for car trips and reduces congestion. Already, nearly 40 percent of people with Internet access say they go to the store or the mall less often.

Many Americans are familiar with consumer e-commerce giants like Amazon.com, eBay, and Travelocity.com. But the lesser-known names doing business-to-business e-commerce, such as supply-chain management, dwarf the consumer sector. While consumer e-commerce is expected to grow from $7.8 billion in 1998 to $108 billion in 2003, business e-commerce is expected to rise from $43 billion to more than $1 trillion, according to Forrester Research. As of mid-1999, General Electric alone was doing more than $1 billion worth of web-based business annually, including online procurement of goods and materials.

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By 2007, e-commerce could eliminate the need for about 5 percent of commercial building space, including up to 1 billion square feet of warehouse space, 1.5 billion square feet of retail space, and 2 billion square feet of commercial office space, the equivalent of almost 450 Sears Towers. Avoiding construction of these buildings could prevent the release of 40 million metric tons of greenhouse gases into the atmosphere. And by eliminating the need for operations and maintenance of these buildings, we could save the output of 20 average power plants and 67 trillion BTUs of natural gas.

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