Navigant Research Blog

Data Centers Morphing Into Virtual Power Plants

— February 12, 2013

Source: ABBWhat is a “virtual power plant?” The term means different things to different people in different parts of the world.  Pike Research has come up with its own definition: A system that relies upon software to remotely and automatically dispatch and optimize generation, demand-side, or storage resources (including PEVs and bi-directional inverters) in a single, secure web-connected platform.

At their core, VPPs tap existing grid networks to tailor electricity supply and demand services for a customer, utility, or grid operator.  Without any large-scale fundamental infrastructure upgrades, VPPs can stretch supplies from existing generators and utility demand reduction programs.

The latest VPP model to emerge is based not on geographic proximity – typically the top consideration – but rather on enterprise ownership of global operations.  Ironically enough, the farther away each facility linked in the VPP, the better!  Companies such as PowerAssure are investigating ways for companies that use large global data center operations, such as Apple and Google, to create enterprise VPPs that span the globe, whereby data centers shut down operations and shift load from the regions of the world in daylight to the nighttime half of the globe, where power is cheaper.  The technology to carry out this level of global energy arbitrage – known as “following the moon” – is nearly here (though some engineers may disagree). “Data centers can modulate their IT loads based on external events, such as the price of power, and in the process, save money and get paid for providing demand response (DR) services,” Peter Maltbaek, vice president of worldwide sales for PowerAssure, told me.

Changing Models and Mindsets

The U.S. Environmental Protection Agency (EPA) recently revised rules governing limits imposed upon use of diesel generators that should help increase the availability of DR throughout the United States.  The chief challenge for global enterprise VPPs comes on similar regulatory restraints as well as the accounting end of such transactions.  Of course, if large numbers of large energy users employed this strategy, it could wreak havoc with local grid stability instead of enhancing reliability.  How national and regional regulators would respond to such a business model, based largely on financial flows instead of engineering smarts, is unclear.

Another challenge is changing the mindset of data center owners.  “They need 100% availability and are leery of anyone fooling around with their power supply, especially since it is only typically 3% of total costs,” added Maltbaek.

Lawrence Berkeley National Laboratories (LBNL) released a study last year that looked at data centers and their potential for DR.  ABB, which has invested in PowerAssure and has its own Decathlon DCIM VPP offering for data centers, has already installed a 1 megawatt (MW) DC microgrid at a data center in Zurich, Switzerland providing DR through use of its emergency generators; this system is currently being expanded to 10 MW, will later go to 30 MW, and will then be aggregated with three other data centers in the region.

In Germany, meanwhile, Siemens claims that recent regulatory reforms will allow it to boost its supply-side VPP capacity to 3,000 MW by 2018.  Last year, the company announced that it would increase the capacity of its VPP from less than 10 MW to 200 MW by 2015.  The company says that Germany has enough spare capacity on its transmission lines to create VPPs that span the entire country.


A FVER Cure for Data Center Inefficiency

— October 31, 2012

An article in The New York Times on data center energy consumption has brought the debate over the hidden environmental costs of the digital society to a broader audience.  We have examined several of these issues in previous blogs and in our green data center report.

I think the article underplays the efforts the IT industry is making to encourage best practices on energy efficiency, notably through the work of organizations like The Green Grid. But it does highlight one particularly intractable problem: the unproductive consumption of energy by IT systems.  It’s a mark of shame for the industry that typically only 6% to 12% of the energy consumed by IT systems is used to do useful computational work.  This continues to be a problem despite campaigns to get data center managers to turn off idle servers and the availability of tools that can help monitor and manage the power use of IT.

One of the barriers to improvement has been the lack of an accepted metric that enables data centers to be compared in terms of their productive use of energy.  PUE (Power Usage Effectiveness) is now well established as a metric for data center energy efficiency, but it doesn’t capture data center productivity.  In fact, running your IT kit at full power even if it is not doing effective work will improve your PUE score (as IT would be a greater percentage of your energy consumption).

There are several current initiatives to produce a new metric that will account for the productive element of IT energy consumption, giving us a means of assessing which data centers are truly energy efficient.  The Green Grid has produced an initial model and work is also being done in the EU and in Japan, but it’s proving difficult to produce a metric that is both insightful and simple, which has been key to the uptake of PUE.  Now, though, a new metric developed by the BCS Data Centre Specialist Group may have cracked the problem.

Fixed vs. Productive Power

Called Data Centre Fixed to Variable Energy Ratio, or DC-FVER, it can be used to assess the amount of energy consumed for productive work compared to fixed energy consumption (that is, the energy consumed even when the servers are delivering little or no business value).  FVER allows each data center to define a useful work metric that is relevant to a company’s business, so it’s tailorable to different types of data center.  For example, a news website might measure productivity in terms of the number of webpages served per hour, while an online retailer may look at the number of transactions per second.  FVER is defined by the formula:

FVER = 1 + (Fixed Energy (kWh)) / Variable Energy (kWh))

As with PUE, the ideal FVER rating is 1, which would mean all energy is being consumed for productive work.  In reality, most data centers are expected to have scores closer to 10 on first assessment.

A simple example given by Victor Smith, Vice Chairman of the BCS, at the Green Data Centre Conference explains how it might work.  After choosing a useful work metric for a specific data center, the output and the energy consumption needs to be measured, say, every hour for a week.  At the time of minimal work, it’s possible to get a measure of the data center’s fixed energy consumption.  So if in the most productive hour 1.2 megawatt-hours (MWh) are consumed and in the least productive time 1 MWh, then variable consumption is 200 kWh, (the energy consumed for productive work).  In this case:

FVER =  1 +  (1000 kWh / 200 kWh) = 6

FVER will also allow direct comparison between data centers based on their productivity relative to energy consumption.  FVER is only one among a number of approaches to measuring data center productivity, and more complex metrics will also have their place, but it could help accurately assess the efficiency of data centers.


Greenpeace Criticizes Apple, Amazon, Microsoft Data Centers

— April 20, 2012

Greenpeace has re-ignited the debate over the environmental impact of cloud computing with its latest report on energy consumption and energy sourcing in the data centers of some of the largest tech companies.  Its new report, How Clean is Your Cloud?, looks at the data center deployments of 14 of the leading players in the market.

The report is particularly critical of Apple, Amazon and Microsoft, identifying them as major suppliers who are expanding their data center capacity “without adequate regard to source of electricity,” relying “heavily on dirty energy to power their clouds”.  On the other hand, it praises Google and Yahoo for the investments in renewable energy.  Its rapprochement with Facebook also continues, as it commends the social media giant’s decision to develop its next data center in Sweden, where it will be able draw on renewable energy sources for its power.

Both Apple and Amazon have reasserted the green credentials of their data centers and of cloud computing in general.  However, according to a report in The Guardian, Amazon appears to be simply retreading arguments for the general benefits of cloud computing, while sidestepping the issue of energy sourcing altogether.  This rather misses the point of Greenpeace’s criticism.

More interestingly, Apple has responded by providing more details on what it is actually doing in its flagship data center in Maiden, North Carolina.   Apple argues that its new data center will be highly energy efficient, will use a significant amount of renewable energy, and overall will use only 20% of the 100 megawatts (MW) attributed to it by Greenpeace.   In turn this is putting the spotlight on Greenpeace’s method for ranking data centers.

However, Apple would seem to be suffering in part from inflating its own claims to being green.  It’s hard to see how it can claim to building the greenest data center ever if it is still relying even partially on coal-generated electricity – Verne Global, for example, likely feels it has a much better claim on that score.  Interestingly, Apple now says that its next data center in Oregon will be powered by 100% renewable energy, something Greenpeace hadn’t allowed for in its rankings.

Greenpeace can claim that getting Apple to talk more openly about energy use in its data center is already a step forward.  But until there’s an agreement on data transparency and metrics, such partial disclosures tend to confuse rather than clarify the debate.  The focus should therefore be on getting cloud computing providers to be more open about the actual energy efficiency and environmental impact of their data centers.

As Greenpeace says, data centers are the factories of the digital world. So it’s interesting to see Akamai, the cloud and Internet platform provider, gaining credit from Greenpeace for being the first major players to report on its Carbon Usage Effectiveness (CUE).  CUE, developed by the Green Grid, provides a means of assessing a data centers overall emissions performance, including its primary energy sources.  Only when all cloud providers enable such transparency will customers be able to make informed decision on whether they are procuring cloud services that are truly green.


Iceland Bets on Green Data Centers

— April 12, 2012

It’s always interesting to see a project you’ve been tracking for some time come to fruition.  I’ve been following Verne Global, and its plans for a data center campus in Iceland, for almost two years, so it was rewarding to see its progress first-hand at the official launch event last month.

The Verne Global data center is based on a former NATO facility west of Reykjavik, near Keflavik International Airport.  Iceland’s advantages as a staging post between North America and Europe are important, but it’s the availability of a dual-sourced renewable energy supply that makes the project unique.  Iceland’s electricity is provided 100% by hydropower and geothermal energy.  In addition, Iceland’s temperate climate enables year round free air cooling without the need for chillers, helping the site to operate at a power usage effectiveness (PUE, a measure of how efficiently a data center uses energy) of around 1.2.

The data center’s location provides strong green credentials, but it also offers important commercial advantages.  Iceland’s renewable energy resources mean a stable and cheap source of electricity for data center operators and other businesses.  Landsvirkjun, the local utility, is able to offer up to 20-year terms for electricity rates and has, for example, been offering a public rate of $43 per megawatt for 12 years.  This allows Verne Global to claim that the total TCO for its customers could be 60% lower than a similar deployment in London.

The choice of location has been combined with an innovative approach to data center development through a close partnership with Colt.  I’ve written previously about Colt’s approach to modular data center design, and the Keflavik data center is its first public showcase, though it has since announced another data center customer in UK luxury car maker Jaguar Land Rover.  The partnership with Verne Global also involves Colt installing a new point-of-presence (POP) for its Pan-European communications network within the facility.  Having had a chance to see the actual data center and talk to Colt’s engineering and management team, I understand more clearly how far its offering differs from containerized approaches to modular design.  “Pre-fabricated data centers” is perhaps a better term for what Colt is doing, building the components at its factory in the north of England and shipping them for rapid installation on-site.  Colt’s approach is also modular in that it supports an incremental build-out of the data center in 500 square-meter units, which is also helping Verne Global manage its capital investment.

Another key stakeholder in this venture is the Icelandic government.  During the launch, the local mayor and an Icelandic government minister gave speeches that showed their clear enthusiasm for the project.  Iceland is keen to exploit its natural advantages to develop a large-scale data center industry and has been clearing away regulatory and tax issues that might hamper expansion of the sector.  Iceland, of course, was one of the countries most badly hit by the banking crisis and it is now betting on data centers as a more stable basis for the future growth.  The availability of the new Emerald Express Trans-Atlantic Cable System, a 5,200 km ultra-high bandwidth link between the United States, Canada, the United Kingdom and Iceland, planned for late 2012, will help Iceland and Verne Global better target U.S. data center business.

Today, Iceland’s energy surplus supports a power-hungry aluminum smelting industry.  The government hopes that in future, processing bits may be equally important to the island’s economy.


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