Corporate America Embraces The Green Data Server

Big piles of data and power bills make green data centers a winner.

With ever-increasing amounts of data being generated by Corporate America annually, energy-thirsty data centers are quickly becoming many firms’ most important green initiative.

“If you look at the past five to seven years, energy for power and cooling is the main issue,” says Jill Yaoz, CEO of AFCOM, the main industry organization of data management professionals.

She says her members looked at spikes in energy prices in 2008 to run their data centers’ server farms, and they needed to make the pain stop. “Because of the energy crisis, ‘greener’ has been extremely important,” she says.

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At issue is the energyneeded not just to run an ever-increasing number of server farms around the country, but also to keep them cool to ensure reliable operation for the critical functions they now perform.

But new, efficient cooling systems in data-center floors and on server racks themselves — including using cooler air or water resources naturally surrounding the centers — are cutting the amount of energy they consume, says green IT analyst Eric Woods of cleantech research firm Pike Research.

He adds the introduction of more powerful, yet energy-efficient, server technology has helped by cutting down on energy needs and by allowing for the consolidation of several data centers into one facility.

“You are getting two to three times the performance for the same power draw,” he says.

Pike estimates the green data center market opportunity will be just under $13 billion in 2011, and nearly $41 billion by 2015.

“The big guys have led the way with their own data center innovations,” says Woods, referring to information-technology sector titans like IBM , Intel , HP and Microsoft .

But other links in the data management supply chain — data center builders, hosting companies and communications systems operators like phone companies — are also focusing on the issue to keep their clients happy, he adds.

With more and more companies adding data capacity — AFCOM’s 4,000 members tend over 3,600 data centers — exploding demand from all kinds of businesses has become a challenge.

The U.S. Environmental Protection Agency estimates data-center energy usage doubled from the dotcom boom days of 2000 to 2006 and will double again by the end of 2011.

The EPA says U.S. server farms used the same amount of energy as all of the nation’s TV sets combined — about 1.5 percent of total national electrical load, with a power bill of more than $4.5 billion annually.

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The agency also warns that electricity demand from servers could destabilize the power grid around tech-heavy regions like the Bay Area, greater New York and metro Boston’s tech corridor

AFCOM’s Yaoz says that in the past data centers were mainly considered an infrastructure issue, with management more concerned with upfront capital costs.

“Although they were in charge of [data centers], they often never saw a power bill,” says Yaoz about the average CIO.

But a recent Stanford University/Lawrence Berkeley Laboratory report commissioned by HP, Microsoft and Intel predicts operating costs matching, and surpassing, capital costs for data centers by 2016.

In addition, a March 2011 report from IT research firm Gartner points out that the growing lifespan of these data centers means operating costs are becoming crucial.

"In the world of IT, everything has cascading effects,” says Gartner infrastructure research head David Cappuccio. “In data centers the traditional methods of design no longer work without understanding the outside forces that will have an impact on data center costs, size and longevity."

Since data centers form their biggest piece of infrastructure, internet giants like and Google have been paring server energy use for a while, says Woods, who adds other data-intensive businesses are getting involved.

CNBC Investing In Green Tech 2011
CNBC Investing In Green Tech 2011

“It’s now becoming more of an issue in large-scale enterprise IT, with banks and retailers now starting to come on board,” he says.

The next generation of innovation could include minute-by-minute monitoring of data center operation, similar to how HVAC and other building systems are now managed.

“I think we will continue to see a lot of innovation on all fronts, but monitoring and management of data center operations — particularly spanning the facilities-IT divide — is a relatively new area that is getting a lot of attention,” says Woods.

Gartner’s report also focuses on the potential efficiency windfall from cloud computing, where computer capacity is delivered on-demand, like electricity or phone services, and which should lessen overall data center demand. Yaoz and Woods both say it will also reduce energy costs.

Whatever the means of energy reduction, Yaoz adds that many utilities are also providing incentives to data center operators to reduce the electricity load from these operations.

“Green is the new buzzword,” she says, but she adds some her members “are taking advantage and savings hundreds of thousands of dollars.”

That kind of financial motivation is the best catalyst for change, especially in a rising price environment for energy like today, he says.

But like many new technological advances, it will take a while to be adopted by a broad swath of users.

“The big challenge will be getting the vast majority of organizations with mid-tier or small centers to adopt these ‘best practices,’” says Woods.