Sustainable Data Center involves both clients and Data Center service provider working together


While previously working on the Singapore Green Data Centre technical sub-committee and also in the line of data center business in Singapore, Australia and China, I discovered something as simple as electricity charges has a different reaction from the different clients even within the same country. This is due to differences in treating the electricity usage with the rack/private suite space that the client leases.

The IT user management has for the most part been responsible for management and cost of outsourced data centers. They are now looking at the operations expenses and it often comes up that what have they been paying as part of leasing the private suite or those racks.

In China, as I mentioned in my post number 2 on my view of the China Data Center market (2016), there is a two tier data center market. The hosting and shared co-location customers rent by the rack and wanted the electricity charges bundled at a flat rate and wanted it as a total cost and not separately shown in the invoice.

For clients who lease private suite from wholesale data center service provider, some will opt for flat electricity charges bundled in the invoice because they in turn sub-lease the data center suite space on a per rack or even per 2U server manner and wanted it simple.

The data center service provider is made to do what is simple, which is to take say 1RMB (for example, the average of peak+low of some cities are different) x 20Ampere (the contracted capacity) multiply by 24 hours multiply by 30/31 days to arrive at the electricity charge to bundle into the per rack or lease space charge (say private suite can house 50 racks, then its 50 x 20 x 24 x 31).

In most time, the data center service provider have a bit of a margin earned from all the customers who don’t use up to capacity, and there is no motivation to improve the power efficiency as the actual power consumption is not linked to the power charges bundled into the invoice and it does not apparently benefit the data center service provider.

This bundled-all-in-pricing will cause the client to miss the whole picture and longer term sustainability of the data center and the data center business itself. But this should be changing, sooner than later.

There are data center clients and data center service providers that practice a more direct pass through model.

This is how it works:

  1. The data center suite is still build to client requirement and handed over to the client.
  2. Private electricity meter at the sub-board for the client.
  3. The agreement struck is such that the utility supply company’s electricity bill is handed over as part of the invoice, and the client pays the portion that is metered at the private electricity meter.

Some variation to number 3 is that there is a agreed PUE factor to multiply to the electricity charges that the client pays.

Paying actual usage sounds logical. There is a problem which is under-utilization of capacity that the data center service provider has designed according to client specifications and yet the client did not fully utilize. The power grid and/or the power utility company will impose charges (penalty) for unused capacity.

This has to be viewed in two parts:

  1. Firstly, the infrastructure component whether capacity is fully utilized or not should be fully factored into the lease space rent
  2. Sub-optimal utilization of the contracted utility capacity, this needs careful prediction of power capacity on a per month/quarter/year depending on the power utility company pre-requisite on adjusting the requested for capacity, but this can be built into the client agreement


Ultimately, the data center service provider should not view or consider to earn from utility charges, firstly most countries forbid it as part of power supply regulations and secondly, the client will view it negatively and it will affect future business.

Understanding and achieving both a transparent and more direct linkage to the utility supply will enable:

  1. Energy efficiency planning and projects by the data center service providers
  2. Energy efficiency planning and projects by the data center service providers
  3. The best of them all is Energy efficiency planning and projects by the data center service provider and the client.

From managing the energy efficiency all the way from the utility supply into the building, through the data center service provider data center infrastructure, and through the sub-boards onto the rack PDUs into the servers, a lot more can be achieved for energy efficiency that will reach that most important driver of all: cost savings and sustainable business for both the client and the data center service provider.

Sustainable Data Center involves both clients and Data Center service provider working together

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