Energy use

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Energy represents one of the largest costs of operating our facilities, and we continually work to reduce consumption. In 2007, our total energy use decreased approximately 4 percent, while HP's overall expenditure on energy increased 8 percent. Our sources of energy were electricity (88 percent) and natural gas (12 percent).

Energy use accounts for 98 percent of the GHG emissions generated by our operations, with the remaining 2 percent of emissions generated by refrigeration equipment and HP manufacturing processes. GHG emissions from employee business travel are reported separately in Business travel. (Product transport and employee commuting are not included.)

	HP Workplace Transformation

Launched in 2006, HP Workplace Transformation (HPWT) is a phased global initiative to improve employee productivity and use our facilities more efficiently. We are consolidating our operational locations to fewer core sites, improving space utilization and upgrading building infrastructure to support employee mobility and higher density. Our goal is to reduce energy consumption and the resulting GHG emissions from HP-owned and HP-leased facilities worldwide to 16 percent below 2005 levels, by 2010.¹

Sites upgraded in HPWT are equipped with the latest energy-efficient HP technology. For example, we are replacing cathode ray tube monitors with flat panel displays and relying more on notebook PCs in temporary office spaces. Over time, we expect the more energy-efficient monitors and notebooks to reduce energy use by more than 4 million kilowatt hours (kWh) per year, saving approximately 2,000 tonnes of carbon dioxide equivalent (CO₂e) and about $320,000.

We are continuing to reduce paper waste in our facilities. After analysis showed that duplexing (double-sided printing) could reduce office paper waste by 25 percent, HP adopted it as its internal printing standard in 2007. We are implementing this standard across the company using HP Web Jetadmin and Universal Print Driver to configure printers. This technology is helping us achieve our goal for 80 percent of general office printing and copying to be double-sided by the end of 2008, saving up to 726 tonnes of paper a year and $7.7 million. We have started or completed network printer installations in 70 sites across 25 countries.

We also began to replace carpet at HP sites with carbon-neutral carpet tiles. The GHG emissions created through the entire life cycle of the new carpet is offset by emission reduction credits. In addition, the old carpet will be recycled into new products and diverted from landfills.

With the aid of technology, our employees are able to work flexibly and with greater mobility than ever before. As a result, they need less office space, enabling us to decommission the surplus. HP now owns and leases less space than we did a year ago, even as our business grew. We decommissioned 179 sites around the world in 2007, yielding a net reduction of 2.9 million square feet (269,400 square meters), or 5.7 percent of our total space.

Major HPWT projects in 2007 were completed at our Bangalore, Barcelona, Cupertino, Houston, Monterrey, San Diego, Sofia and Taiwan facilities. In Bangalore, we built a new 43,850-square-meter facility. The 18-acre HP-owned campus can accommodate 2,500 employees. As leases from eight facilities in the Bangalore area are terminated, we relocate employees to the new campus.

We also completed development of a Workplace Standards Manual and trained 500 Real Estate and Workplace Services employees globally to support HPWT.

	Data center consolidation

Data center consolidation provides the opportunity to decrease the environmental impact of our facilities while reducing costs, eliminating older technologies and improving service levels. Over three years ending in 2008, we are consolidating 85 HP IT and HP-hosted customer data centers worldwide (not including data centers that are part of HP Labs) into just six locations in three U.S. cities. At these sites, we’re implementing the latest energy-saving features in our second generation of Smart Cooling technology, HP Dynamic Smart Cooling, which enables real-time changes to air conditioners, fans, vents and computing equipment. Dynamic and Static Smart Cooling principles typically yield energy savings of 20 percent to 40 percent over legacy HP data centers. We plan to complete implementation of this technology in most of these locations by the end of 2008.

Our consolidated data centers collectively occupy more than 38,000 square meters in Atlanta, Austin and Houston, approximately 35 percent less space than the original sites. In each city, two sites are located within 25 miles of each other, sharing network connectivity and providing improved availability, business continuity and disaster recovery. When the initiative is complete and fully optimized, we estimate yearly energy savings from data center consolidation of up to 350 million kWh and annual cost savings of up to $25 million.

In addition, we implemented our Dynamic Smart Cooling program at our HP Labs data center in Bangalore. We estimate it will significantly improve its efficiency compared with legacy HP data centers. (See case study.)

	2007 energy audits

In 2007, our energy audits focused on lighting systems and identified several projects, primarily in the United States, where we could reduce energy consumption by more than 20 million kWh per year. For example, several of our large product centers can be upgraded from traditional high-bay metal halide lighting to high-output T5 fluorescent fixtures. These projects were studied in late 2007 and are undergoing financial review in early 2008.

	Electricity use

HP measures electricity consumption two ways: in absolute use (million kWh) and normalized per unit of floor space (kWh/square meter). Our electricity use in 2007 decreased by 2 percent compared with 2006. Despite business mergers and acquisitions that added 80,000 square meters, our overall real estate footprint decreased in 2007. Facilities acquired through mergers and acquisitions consumed electricity equal to an additional 1.4 percent compared to 2006. Without these activities, our electricity use would have decreased by approximately 3.5 percent.

Other investments we made in 2007 to cut our consumption include transitioning research and development labs into newer and more efficient space, expanding our computerized control technology, deploying Dynamic Smart Cooling in data centers and labs and utilizing variable-flow fans and pumps in retrofits and new construction. We believe the impact of data center consolidation (see above) will be more evident in upcoming years as legacy data centers are closed.

Electricity use, 2005-2007 [million kWh]
	2005	2006	2007
Americas	1,740	1,670	1,700
Europe, Middle   East and Africa	600	574	523
Asia Pacific   and Japan	461	515	481
Total	2,801	2,759	2,704
kWh per square   meter	460	464	474

See the regional breakdown of electricity use per square meter in the data dashboard.

	Natural gas use

Natural gas represented about 12 percent of HP’s energy consumption from operations in 2007. We use natural gas primarily for heating water and buildings and for food service in HP cafeterias.

Our consumption of natural gas decreased by 81 million kWh, or 18 percent. Without the mergers and acquisitions mentioned above, the total would have decreased by an additional 1 percent. Our HPWT initiative and aggressive energy conservation efforts were largely responsible for the substantial drop.

Natural gas use, 2005-2007 [million kWh]
	2005	2006	2007
Americas	243.0	241.0	234.5
Europe, Middle   East and Africa	173.0	171.0	107.6
Asia Pacific   and Japan	14.4	25.7	14.5
Total	430.4	437.7	356.6
kWh per   square meter	71.0	74.0	62.5

See the regional breakdown of natural gas use per square meter in the data dashboard.

	Renewable energy

We look for opportunities to conserve energy and use alternative energy sources where they are available and economically viable. We are exploring such options as renewable generation at HP sites and purchasing electricity from third-party renewable generators.

In December 2006, HP joined the U.S. Environmental Protection Agency (EPA) Green Power Purchase program. In response to the EPA’s challenge to Fortune 500 companies to double their purchases of renewable energy by the end of 2007, we committed to increase our renewable energy purchases by more than 350 percent during 2007. We achieved this goal by purchasing 50 million kWh of renewable energy credits in the United States, representing approximately 2 percent of HP’s worldwide energy consumption. The premium we paid supports the growth of the renewable energy market. We purchased and used an additional 2.6 million kWh of actual renewable energy for our Roseville site—4 percent of the site’s energy consumption. These commitments augmented the 8.8 million kWh of renewable energy already purchased at various HP sites. 

As part of our strategy to reduce our global carbon footprint, HP recently announced relationships with two renewable energy providers, SunPower Corp. in the United States and Airtricity in Ireland. In 2008, 80 million kWh, or nearly 90 percent of the electricity provided to our operations in Ireland will be generated by wind turbines in that country. The Airtricity contract will save around 40,000 tonnes of CO₂e per year.

In a major new on-site generation project scheduled for 2008, Sun Power Corporation will install and operate 5,000 solar panels on the roofs of five buildings at our San Diego site, generating an estimated 1.7 million kWh of electricity. HP has contracted to buy this power for 15 years, saving 454 tonnes of CO₂e emissions each year and increasing the percentage of renewable power in our portfolio. With this project, HP is taking advantage of incentives under the California Public Utilities Commission’s California Solar Initiative, which aims to increase solar energy use statewide. HP will see net savings beginning in the first year of the agreement, without making an initial capital expenditure. HP and Sun Power Corporation are also offering incentives to U.S. HP employees to install solar panels on their homes.

Renewable energy purchasing, 2006–2007

¹ HP has revised the baseline year of our operations energy goal to 2005 from 2006 to align with our other energy goals. This is not a change in substance of the goal since we remain committed to the same 2010 energy use target; it is only a change in the baseline year. As HP operations energy use was approximately 1% higher in 2005 compared to 2006, this increases the goal’s percentage reduction to 16% below 2005 by 2010.
² Restated from FY06.