Which of the following BEST describes the payback period of a Green IT programme?

Question

Options

• AThe time taken to realise the programme benefits.
• BThe time taken to repay the original investment.
• CThe time taken to raise the budget for the programme.
• DThe time taken to reclaim any budget overruns.

• B
  91% (31)
• C
  6% (2)
• D
  3% (1)

Explanation

Payback period specifically means the time required to recover the initial capital outlay through savings or returns - making B correct. It's a standard financial metric used to evaluate whether an investment (like a Green IT programme) is worthwhile.

• A is wrong because realising benefits (e.g., energy savings, efficiency gains) is the concept of benefits realisation, not payback period - benefits can begin before the investment is fully repaid.
• C is wrong because raising budget is a funding or procurement activity that happens before the programme begins, not a measure of financial return.
• D is wrong because reclaiming budget overruns relates to cost recovery or variance management, which is a separate financial control concept.

Memory tip: Think of "payback" literally - it's about paying back what you spent. If you invested £100k in Green IT and save £25k/year, the payback period is 4 years. The word maps directly to the answer.

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