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03:30 PM
Greg MacSweeney
Greg MacSweeney
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Energy-Efficient Data Centers on the Horizon

The World Economic Forum seemed to be focused solely on global warming and climate change, if you relied on the news reports from columnists attending the event, including this magazine's own coverage.

The World Economic Forum seemed to be focused solely on global warming and climate change, if you relied on the news reports from columnists attending the event, including this magazine's own coverage. The focus on climate change at Davos, combined with the recent announcement by a group of 10 bellwether companies not usually associated with conservation -- including Alcoa, BP America, DuPont and Lehman Brothers -- signifies that the business community realizes that climate issues will be important to shareholders.

Wall Street firms are considered "low emitters" of greenhouse gasses and usually aren't discussed among the heavy-industry corporations -- such as energy producers and chemical companies. But financial services firms are becoming aware of their own impact on the environment -- especially when it comes to soaking up electricity in their vast data centers. Wall Street, in particular, is fond of using the fastest chips and energy-hogging processors to reduce data latency for trading and to perform risk management calculations.

But just as Wall Street often is the first to use the newest, fastest processors, it also will likely be the first to move toward more energy efficient data centers. High-performance computing, to date, has been focused solely on faster processing speeds. But as energy costs continue to rise, vendors and financial firms alike realize that they can't continue to build energy-inefficient data centers. Servers that rely on power-hungry processors would literally burst into flames if not for the gazillion-BTU air conditioning systems that keep them from melting -- another costly expense for data centers. Intel recently released its 45nm processor, which is billed to be ultrafast but uses far less energy and heat than existing processors. It's a start, but it's only a small piece of the puzzle for companies looking to reduce energy consumption in their data centers.

Energy costs that are rising by double digits each year are not tolerable for any business, financial firms included, despite recent record corporate profits. The largest challenge for a CTO over the next few years may be to build data centers based on new energy-efficient technology that doesn't break the bank. Can you imagine the wrath of a CFO who is forced to tell investors that his firm missed its earnings target because the electric bill was too high? As unbelievable as it sounds, it could happen if energy costs continue to rise. If you end up being that firm's CTO, you'd best get your resume up to date.

Greg MacSweeney is editorial director of InformationWeek Financial Services, whose brands include Wall Street & Technology, Bank Systems & Technology, Advanced Trading, and Insurance & Technology. View Full Bio
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