4 Questions Every CEO Should Ask

If hot data centers are raising energy costs, how can CEOs and CFOs get the information they need to drive energy efficiency?

We asked Pitt Turner, Executive Director of the Uptime Institute, what every C-Suite should ask their Information Technology departments. Uptime is an organization that has focused on energy efficiency since 1993, and developed the IV Tier system that is analogous to a LEED standard for Data Centers.

He answered by mentioning a McKinsey and Company report, that included insights from Uptime. The report pointed out that the true costs of servers–the energy required to run, house and cool them–are four to five times greater than the cost of the hardware over a 5-10 year time frame. McKinsey also mentioned that, in many industries, the data center is the largest producer of greenhouse gases, as well as growth in capital and operational expenditures.

Yet, he believes that many CEOs and CIOs do not task their IT departments with developing the long term energy efficient strategies to reduce expenses, let alone risks from carbon legislation. Since energy efficiency comes from planning in order to use existing resources better, it is a smart way to lower costs with the least amount of outlay.  He provided four questions that he thinks the C-Suite should be asking to ensure that they have the information to make sure their IT departments are making the best decisions for the entire organization.

1:  How much is data center power costing?

W. Pitt Turner IV, PE

Generally, energy bills are paid by the facilities department, so Information Technology (IT) has no idea how much power they are using. It’s like handing your kids a credit card when you pay the bills: there’s little incentive to lower the bill.

Turner said that IT should work with the facilities department, and itemize IT usage.  This information can be used to make better decisions, and to set goals for lowering energy.

2:  Do we have a report card that includes all relevant data, so we can see demand and capacity of all of our resources?

IT often reports on system capacity, but not energy.  System capacity is the ability of the IT infrastructure to handle a demand on applications, data and storage. If everyone in your facility decides to add new platforms and applications at once, will the system run out of capacity?

Available capacity is the ability of the electrical system to remain in operation in spite of peak demands from IT, as well as the cooling or Heating-Ventilating-Air Conditioning (HVAC) systems. There’s a very defined upper load limit for capacity, and often management doesn’t know what it is.  So they may see daily IT reports on storage, bandwidth and computer usage against capacity, but what about the uninterruptable power supply (UPS)?  Does management know what the UPS cap is, and if there is sufficient engine generator power.  Management needs to know how much capacity reserve there is before it runs out.

3. What is the use profile on our IT investment?

Every facility is not the same.  In many instances, IT uses 5-10% of the capacity of their devices.  Turner calls this “a horribly ineffective use of the largest investment in the company.” He sees major sources of inefficiencies:

Inefficient hardware

As hardware ages, IT departments—and employees—want the most, the latest, and the largest, regardless of their actual use profile.  If the applications are the same, the load is the same. That larger computer with a faster processor will not make the program run appreciably faster, and an extra gigabyte or five of storage isn’t needed if the current use isn’t nearly at capacity.

Retired hardware

Often, servers no longer in use or upgraded, are kept online as a fall back.  Over time, those machines no longer process IT work at all. Turner cites a case where a company lowered their energy use by 15% by just turning off equipment that was no longer in use.

Always On

Many departments leave computers “always on” regardless of whether workers are in lengthy meetings, out to lunch or gone home.  Turner likened these to the professional Chef who always has burners going on the stove in case the need arises. It may be great during the dinner hour, but during afternoon lulls it becomes wasteful.

Inappropriate Incentive Structures

IT managers are often not incentivized to lower IT costs.  In many cases, they are bonused by how many new applications they put in, not how efficiently the applications are working.  He cited cases where companies had literally hundreds of application installed, although almost none were in regular use.  Some of these sit in the background, consuming energy, processing power and disk space.

4: When we make IT decisions who is being excluded in the decision making process?

Turner noted that the whole spectrum of energy demand for computers includes chillers, hardware, software and more. When IT departments make decisions, they need to take into account the facility needs for space as well as the organizational needs for more computing power. As these decisions are being made, the IT department needs to think of the added burden to the whole structure, not just their own domain. As examples he cited:

Installing hardware options

Most manufacturers offer options that are more power efficient, but often those options are not implemented. In some instances, power efficiency is a feature that is included in the hardware—such as automatic shut down—but must be elected.

Hardware purchasing decisions

In some cases, the more efficient hardware is more expensive. But the long term energy costs of the computer are usually larger than the cost of the hardware.  So the small savings on purchase translates into longer term costs that can be more volatile, as energy prices fluctuate.

Requisitioning hardware

If greater processing power or faster speeds are elected for applications that don’t need them, then those machines will produce more heat which creates a greater demand for cooler air. Turner mentioned a European bank that removed 80% of their UPS power demand and improved operations, through better IT management, not facilities changes.

Consequences

In Turner’s final remarks, he mentioned that if companies do not implement their own procedures and set realistic goals, he “fears our friendly governments will be standing in line to help us by providing direction, standards, and other assistance.”  He mentioned California’s Title 24, the state building code, that started a process in May to “solve the problem of energy consumption in data centers”. For example, they are considering a statutory limit on the maximum amount of air circulation that can be used for a defined IT load.

About Uptime

The Uptime Institute is an unbiased, third-party data center research, education, and consulting organization focused on improving data center performance and efficiency through collaboration and innovation.