Green IT initiatives could flourish in the recession, as constrained IT budgets force firms to look at initiatives which eliminate the need for capital expenditure, according to a new report by Datamonitor.

The analyst firm's Can Green IT Bloom in an Economic Downturn? report argues that green IT projects such as virtualisation, more efficient datacentre design and layout, and asset lifecycle management will become increasingly important as budgets remain flat in 2009.

"The global economic recession has spurred a paradigm shift in the way organisations evaluate, budget for and deploy green IT," said Rhonda Ascierto, senior analyst at Datamonitor and the report's author.

"The downturn has also resulted in green IT trends for datacentres, client devices and asset lifecycle management, as well as reshaped return on investment [RoI] models."

The report argues that companies no longer regard green IT and cost-effective IT as mutually exclusive, and see them offering great opportunities to vendors that align their strategies with organisations' restricted IT budgets.

Vendors will need to develop and market technologies that deliver a short RoI and do not require large capital expenditure, and should focus on educating customers about how to reduce costs and improve operational efficiencies with green IT, according to the report.

Mark Nutt, general manager at IT consultancy firm Morse, agreed that many organisations undertake green IT projects, not because of the environmental benefits but to cut costs.

"There are not many positives in the current economic doom and gloom, but one certainly is that people are undertaking many of those projects previously badged as 'green' in order to reduce costs," he said.

Nutt gave the example of a banking customer of Morse's, which was running out of datacentre space and power. Instead of building a new facility at a cost of £100m, it spent £8m on refreshing, virtualising and consolidating its server environment, and implementing power regulation software.

"As a result, the life of the datacentre has been extended by at least two to three years, and power usage has been reduced with at least £1.5m of annual saving in energy costs, resulting in a CO2 emissions reduction of 6,500 tonnes per year," he said.