IT Service Providers are faced with the challenge to reconcile their goals in providing services efficiently and with the quality of services required while sustaining the environment. With the introduction of carbon taxation and regulations to control green gas emissions, there is a need to expand service design to incorporate heterogeneity in carbon taxes due to regional differences. The service providers have flexibility of selecting best locations for delivery of a service by taking into consideration operational cost associated with green gas emissions. They can also buy or sell carbon credits in a carbon trading market to maintain sustainable operational performance. In this paper, we introduce the Sustainable IT Services (SUITS) framework to develop models for operational performance of an IT Service Provider in a global environment with carbon taxation and carbon credit trading markets. The models are used to formulate a revenue optimization problem for the IT Service Provider in this environment. The model solutions can provide guidance for designing operational level of different IT components and for creating effective strategies for trading in carbon markets. © 2012 IEEE.