IBM Launches Energy-Efficiency Certificate Program

A third-party firm will provide verification of the energy-saving results of data center projects.

IBM is launching an industry-first initiative to help its customers benchmark and verify how efficient they are before and after embarking on data center energy-efficiency projects.

The initiative, unveiled Nov. 2, enables companies to earn efficiency certificates for reducing the energy needed to run their data centers. The certificates—based on energy-use reduction verified by a third party, Neuwing Energy Ventures—provide a way for businesses to identify a certified measurement of their energy-use reduction.

The certificates can be traded for cash on the growing energy efficiency certificate market or otherwise retained to demonstrate reductions in energy use and associated carbon emissions. The energy certificates are not connected with carbon-footprint certificates that are starting to be made available by green data center organizations.

Neuwing Energy Ventures verifies energy efficiency projects and markets energy efficiency certificates, Rich Lechner, IBM's vice president of IT optimization, told eWEEK.

"They will document and verify the energy savings a client achieves through implementing energy efficiency projects," Lechner said. "A good example of this would be the consolidation of a number of servers in a data center down to fewer servers or to a mainframe computer, thanks to virtualization and other factors."

Energy efficiency projects will be identified using IBM's data center evaluation offerings, Lechner said. An evaluation will result in recommendations clients can take, including using virtualization technologies to reduce the number of physical systems needed and fixing data center design flaws to reduce unnecessary power consumption.


Energy efficiency certificates provide financial incentive and recognition for businesses and electricity providers that increase their efficiency, he said. Certificate values are determined by the number of certificates available and the demand for those certificates on each trading market, he said.

Data centers typically consume 15 times more energy per square foot than a typical office building and, in some cases, may be 100 times more energy intensive, Lechner said.

Energy efficiency opportunities can be significant. The System z consolidation project announced as part of IBM's Project Big Green earlier this year—where IBM is consolidating 3,900 distributed servers onto 33 System z servers in its data centers worldwide—will help conserve up to 119,000 megawatt hours annually, or enough electricity to power about 9,000 average homes in the United States.

"It'll be interesting to see how this all works," said Clay Ryder, an analyst with Sageza Group. "As time goes on, the value of these certificates may grow dramatically ... Eventually we may see these bought and sold on eBay, for example."

Matthew Rosenblum, executive vice president and chief financial officer of Neuwing Energy, agrees.

"Since the recent emergence of energy efficiency certificates as a market [of its own], we have seen market volume quickly grow into the millions of megawatt hours and expect the energy efficiency market to surpass the renewable energy certificates market in a couple of years," Rosenblum said.


Five key steps to building a green, scalable data center. Click here to read more.

Currently, values being discussed are mere pennies on the dollar, but that is expected to change as time goes by.

"The question is: Do you stop and pick up a penny? Is it worth the 2 or 3 cents worth of energy that it has been estimated to pick it up? Probably not," Ryder said. "But if we're talking about a quarter, then it might be worth it. Same thing here; if the savings get to be higher, more people will want to get involved."

Not all companies will have the staff to be able to participate in this, due to all the paperwork and monitoring that needs to be done.

"This is really aimed at the larger enterprise data center customer," analyst Charles King of Pund-IT Research told eWEEK. "I'm fairly sure about that. Smaller businesses might be interested in this also, and they should be, but most really don't have the IT staff help needed to work on this kind of initiative."

For more information on this initiative, go here.


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Chris Preimesberger

Chris J. Preimesberger

Chris J. Preimesberger is Editor-in-Chief of eWEEK and responsible for all the publication's coverage. In his 13 years and more than 4,000 articles at eWEEK, he has distinguished himself in reporting...