Green IT services market is estimated to be valued at USD 26.83 Bn in 2024, exhibiting a CAGR of 17.8% over the forecast period 2024-2031. Growing environmental concerns focused on reducing carbon footprint and conservation of natural resources are driving companies to adopt green IT services to gain a competitive advantage. Furthermore, energy efficiency achieved through green practices reduce operational costs in the long run.
Market Dynamics:
Growing Concerns around Carbon Emissions: With increasing emphasis on environment protection and sustainability, organizations are actively looking for ways to reduce their carbon footprint. Green IT services help companies to optimize their IT infrastructure to lower energy consumption and associated carbon emissions.
Cost Savings from Energy Efficiency: Implementing green IT initiatives such as virtualization, efficient data center design, and power management solutions enable firms to achieve significant cost savings through reduced power and cooling requirements. As green practices lower energy bills in the long run, these deliver high return on investments.
Market Drivers:
Growing Environmental Concerns Boosts Demand for Green IT Services
As environmental issues like climate change become more pressing, businesses and consumers are increasingly concerned about reducing their carbon footprint and operating in a more sustainable manner. Green IT services allow organizations to decrease their energy usage and emissions through strategies like server virtualization, energy-efficient data centers, recycling/reusing electronic waste, and adopting renewable energy sources. As sustainability gains importance, there will be huge demand for consulting, audit, optimization, and certification services that measure and lower the environmental impact of IT infrastructure and operations.
Government Regulations are Forcing Organizations to Adopt Green Practices
Governments around the world are implementing stricter environmental regulations to curb pollution and combat climate change. This includes emissions reporting requirements, carbon taxes, recycling mandates for electronics, and incentives or penalties based on organizations' sustainability performance. To remain compliant, companies must monitor and optimize their resource consumption with the aid of green IT service providers. As legislation becomes more stringent over time, the pressure on businesses to green their operations and offset their carbon footprint will drive increased spending on consultancy, audits, and certification services.
Cost Savings from Energy Efficiency is a Key Attraction
By improving server utilization rates via virtualization, installing energy-efficient hardware, optimizing cooling needs in data centers, and implementing power management policies, green IT services can significantly lower enterprise energy bills. Organizations that adopt strategies like cloud migration or workout-based pricing models also benefit from reduced capital and operational expenditures. As energy costs rise globally, the attractive payback and return on investment delivered by initiatives improving power efficiency will motivate more spending on related services.
Market Restraints:
Lack of In-House Expertise Hinders Adoption of Green IT services
Few organizations have the internal skills required to build, implement, and manage large-scale sustainability programs across their IT infrastructure and operations. Assessing current resource usage, designing optimization roadmaps, executing new policies and technologies, and monitoring ongoing performance needs specialized knowledge that most enterprises lack. The need to either train existing teams or outsource projects to capable service providers can delay some firms from fully leveraging green solutions.
Budget Limitations Restrict Service Uptake
Transitioning to green IT often demands sizeable upfront capital for purchasing new energy-efficient hardware, retrofitting data center facilities, investing in renewable energy systems, and others. The associated costs may seem too high for some small and medium organizations with tight budgets. In difficult economic times when funds are scarce, discretionary spending on sustainability initiatives may be deferred. This financial restraint hampers wider adoption of green IT services that require investment but promise multi-year returns.
Market Opportunities:
Growing Awareness of Sustainability Benefits New Market Potential
As CSR and sustainability rise up corporate and public agendas, more organizations recognize the brand value and competitive differentiation that come with environmental leadership. While larger enterprises have led the way, even small businesses now wish to project green credentials. As awareness about IT's role in reducing carbon footprints spreads beyond early adopters, new client segments and geo-markets emerge for service providers. With the right messaging around cost savings, compliance and reputational gains, these relatively untapped sectors can spur fresh demand.
Partnerships with Equipment Vendors Open Distribution Channels
Leading hardware OEMs have launched sustainability services of their own or tied up with specialist consultancies to promote green solutions. By integrating expertise during new equipment sales cycles, these partnerships offer vendors additional touchpoints with customers to cross-sell value-added offerings. As trusted advisors to buyers, infrastructure providers can recommend or co-deliver optimization assessments post deployment. Such collaborations provide green service companies new captive markets and avenues for scaling revenues via vendor relationships.
Link: https://www.coherentmarketinsights.com/market-insight/green-it-services-market-5093
Key Developments:
- In September 2022, according to a new global market study published by IBM, more than 77% of respondents have opted for a hybrid cloud approach to accelerate digital transformation. However, most of these firms face challenges in integrating various cloud platforms. Less than 25% of respondents manage their hybrid cloud infrastructures holistically, leading to potential blind spots and risks related to skills shortages, security issues, and regulatory obstacles.
- In August 2022, GenCell Energy provider of ammonia & hydrogen fuel cell energy solutions. and Simtel a digital learning software, announced the field test deployment of the GenCell FOX ammonia-based off-grid power solution at a Vodafone-operated mobile telecom tower site in Romania. This solution is designed to meet stringent zero-emission sustainability goals, ensure constant 24/7 power even in extreme weather, and reduce operating expenses by utilizing economical and widely available liquid ammonia fuel.
- In June 2022, IBM partnered with SL Green Realty Corp to utilize IBM's sustainability software to advance the company's environmental, social, and governance (ESG) strategy. SL Green will use Envizi software, an IBM company, to better understand and report on its environmental initiatives.
- In May 2022, Schneider Electric introduced several innovations at Hannover Messe 2022 aimed at accelerating the path to net zero CO2 emissions for customers and partners. The company's technology, combined with AVEVA insights, enables firms to achieve the next industrial generation with improved efficiency, resiliency, and sustainability.
Key Market Players:
Key companies covered as a part of this study include Accenture PLC, Accuvio Sustainability Software, Cority Software Inc., Dakota Software, Enablon Sa, Enviance Inc., Green IT Consulting, Green Step Solutions, HJS Technology, IBM Corporation, Johnson Controls, SAP SE, Schneider Electric SE
