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Cut Through The Green Hype |
Metrics for measuring IT's energy consumption and efficiency could change behavior.
Green hype abounds. How can executives separate reality from myth and inaccuracy? Where should information technology's energy efficiency priorities and initiatives be placed?
First of all, IT is power hungry. IT energy consumption--and therefore its carbon footprint--exceeds virtually all other business functions by a factor of 20 to 40 (industry exceptions include mining, oil refining and aluminum production). For a large financial institution like Wachovia, IT constitutes 10% of total corporate energy consumption, despite its data centers constituting a minuscule square-foot fraction of the company's 3,200-building portfolio. Data center efficiency should be the first area in which IT executives focus their green efforts.
I define a green data center as delivering the most productivity for the least amount of energy consumed. Will Forrest of McKinsey & Co. and I have defined a measure we call the Corporate Average Datacenter Efficiency (CADE) as being a useful--and, currently, the only--metric for measuring the combination of data center productivity and energy consumption.
CADE, while not perfect, divides overall data center efficiency into four individual measures, each of which can be separately measured and benchmarked. These elements include measures of IT asset efficiency and utilization as well as the asset efficiency and utilization of the physical facility that houses these assets. (You can read the report here.)
CADE will motivate IT to find and kill comatose servers. I believe 20% to 30% of all servers aren't doing any work and can be turned off. These servers were technologically replaced years ago, but in a downsized head count-constrained environment, it has been no one's job to turn them off and decommission them. Killing this comatose equipment will not increase productivity, but it will reduce energy consumption, improving a company's CADE score.
Virtualization will increase server utilization by running multiple applications on a single server for about the same power consumption. This also will improve CADE.
Similarly, CADE motivates IT procurement organizations to buy more energy-efficient hardware. Creating incentives to save watts is one of the most effective ways to conserve IT energy because all hardware rolls over in four years or less. Increasing the efficiency of IT hardware is virtually free once organizations begin focusing on watts saved as a goal. CADE also motivates increasing facility utilization and cutting power and cooling overhead costs.
We estimate that companies adopting CADE could at least double their productivity and reduce their power consumption over the next four years while saving enormous amounts of money. Even if they did nothing further, the bottom-line savings would measured in the tens--if not hundreds--of millions dollars over a 10-year period. Of these savings, about 8% would be from a reduction in energy consumption.
Where does the rest come from? We are in the midst of the biggest data center construction boom for real customers in history. Large organizations have construction programs measured in hundreds of millions of dollars, and some are in the billions. Much of this construction may not be needed if CFOs and CIOs focused on driving up CADE. Executives that adopt CADE as their primary measure of IT greenness will be saving money, reducing their carbon footprint and preserving the competitive position of their company.
Once a company has improved its CADE by at least 50%, executives can move on to consider other greenness factors, such as the sustainability of energy sources and prudent waste disposal. However, because IT energy consumption is 20 to 40 times that of buildings, CADE should be the priority.
Kenneth G. Brill is executive director of the Uptime Institute in Santa Fe, N.M.
View the article at Forbes.com 
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