Data Centers and the Smart Grid

October 22, 2012 By Clemens Pfeiffer

Clemens Pfeiffer

This article is part of a series that expands on the Top Trends in Data Center Energy Management. The first article covered The Must-Know Metrics for Data Center Energy Management, and the second covered Energy Management in Virtualized Data Centers.The previous articles described how IT and facilities managers can improve efficiency reduce power consumption in data centers.  While such steps are necessary, they will not remain sufficient much longer. The reason is an impending capacity crisis occurring on the electrical grid.This final installment explores the potential impacts of the impending crisis on data center energy management, and how data center operators may benefit from these opportunities with the smart grid. 

In aggregate, data centers consume an enormous amount of power.According to a detailed study conducted by the US Environmental Protection Agency (EPA) in August 2007, data centers in the US consumed 61 billion kilowatt-hours or 1.5 percent of the nation’s total electricity in 2006, adding some 40 million tons of CO2 to the atmosphere. That amount is twice what was consumed just six years earlier, and the EPA forecasted data center power consumption to double again from 2006 to 2012. 

But the increase in data center energy consumption is only part of the impending crisis. The US Energy Information Administration predicts that total demand for electricity will approach 6 billion gigawatt-hours by 2030, while generation will remain relatively static at about 4 billion gigawatt-hours. In some states, such as Virginia and Oregon, data centers represent over 10 percent of grid capacity.  Making up the difference will require not only new sources of cleaner and renewable energy, but more energy efficiency and peak demand curtailment programs. 

The growing gap between electrical demand and supply will cause the grid to become increasingly unstable and, as a result, energy prices will increase and fluctuate with grid conditions. Most utilities already charge commercial and industrial customers higher rates during periods of peak demand, which usually occur in the later afternoon and early evening. 

To encourage further reductions during peak periods, many utilities have implemented Demand Response (DR) programs for both business and residential customers. The ability of DR to postpone or even avert a crisis is so promising that one member of the US Federal Energy Regulatory Commission identified DR as a “killer application” for the smart grid. 

While some data center operators have taken advantage of DR programs on the facilities side, using their generators, or reducing cooling, IT organizations have long been immune to such programs.  However, to take advantage of utility program incentives, and stabilize the grid, more organizations will begin asking their data center facility and IT departments, as major users of electricity, to reduce consumption during these peak demand periods. Participation is likely to begin initially with fairly benign actions, such as temporarily power-capping less critical servers and turning up the thermostat during the DR events. A capable Data Center Infrastructure Management (DCIM) system can help implement these steps, and can also enable loads to be shifted and/or shed to another data center in a different time zone. The cost savings can be substantial because the time-of-use or critical peak pricing for electricity can be considerably higher during DR events. For example, the cost per megawatt-hour of electricity in Texas is usually in the $30-$60 range, but on one hot summer day this year it spiked to $3,000. 

Because the power generated by “peaker plants” is the most expensive source of electricity, and because a reduction in normal consumption is the equivalent of generation, ancillary markets now exist that enable organizations to actually receive revenue for reducing demand during peak events. These markets normally operate a day or a few hours in advance of an anticipated peak when any organization can then bid the amount they are willing to reduce. 

One clever way to take advantage of these markets is to test the backup generator when the price being paid is expected to be high. Generators should be tested periodically anyway, and the revenue received may well pay for the replacement fuel. 

Some organizations are even preparing to take full advantage of this situation with their own microgrids powered by fuel cells, renewables, or other energy sources. But be careful here: Bidding a power reduction for a day that is forecast to be cloudy or have a variable wind speed is potentially risky with intermittent sources of renewable energy like solar and wind. 

An increasingly common way to reduce data center energy expenditures is to take advantage of the existence of multiple data centers (needed for disaster recovery) by shifting the workload to “follow the moon.” Rates for electricity are inevitably the lowest at night when demand is low and baseload generation is under-utilized. This is why utilities encourage people to charge electric vehicles at night, which is also the ideal time to recharge UPS batteries if the UPS is part of the data center’s DR efforts. 

It is also significant to note that outside air temperatures are their lowest at night, which can substantially cut cooling costs. In fact, a well-designed data center operated exclusively at night during a finite “shift” may not even need a power-hungry air-conditioning system, utilizing instead an airside economizer. The combination of lower rates and a significant reduction in overall power consumption can result in considerable savings. 

Although choosing the location of a separate data center has historically not involved power as a factor, this, too, is changing. Power availability, reliability and pricing are now prominent factors for deciding where to locate data centers. Google and Facebook, among others, are locating new data centers in remote areas like Finland and the Pacific Northwest that offer cheap and abundant power, free cooling, (and, of course, high-speed fiber optic communications). 

Finally, if your organization does not yet have a chief sustainability officer, expect one to be appointed soon, and be prepared to do your share of going “green.” In fact, companies with data centers in Asia and Europe can monetized their data center energy efficiency actions with carbon certificates that can be traded in global carbon markets, increasing their “green” profile. Consequently it is critical to know how much energy the data center consumes, make every effort reasonable to minimize that consumption, and master the tools needed to shed and shift loads dynamically while maintaining service levels. 

Clemens Pfeiffer is the CTO of Power Assure and is a 25-year veteran of the software industry, where he has held leadership roles in process modeling and automation, software architecture and database design, and data center management and optimization technologies.

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