Daily Archives: September 9, 2008

A Savings Template to Save Money Now with Green IT

During the summer slumber, I brought you two posts on how to green your data centers and keep more green in your bank acount and how to green your desktops and keep even more green in your bank account where I told you Green IT would save you bags upon bags of money. If you missed these posts while on vacation, I’d highly recommend getting to them sooner rather than later because, depending on the size of your business, you’re IT is likely costing you anywhere from thousands a month to hundreds of thousands a month more than it needs to – money you can start recapturing tomorrow by switching to Green IT today.

The simple truths of the matter are the following:

  • it costs more to power your average workstation or server over its useful life than it costs to buy it
  • your average workstation and server needs to be replaced every three years, or, at the very least, downgraded to supporting lesser intensity tasks

but, when you switch to Green IT:

  • power becomes a fraction of the cost, as a Green IT solution will normally be 60% to 90% more power efficient, depending on your needs
  • your hardware lasts twice as long – and ends up costing you much less on an annual basis (especially since green thin clients are cheaper than workstations!)

So how much will you save? It depends on how big you are and how many machines you have. The more machines, the more you save. Fortunately, it’s not that hard to come up with a high-level rough estimate. All we need to do is roughly calculate your current annual hardware and energy costs and your expected annual hardware and energy costs with a Green IT solution and calculate the difference.

We can estimate your current annual costs as follows:

  • regular_workstation_costs + regular_workstation_energy_costs +
    high-end_workstation_costs + high-end_workstation_energy_costs +
    server_costs + server_energy_costs

And we can estimate your expected annual Green IT costs as follows:

  • sunray_costs + sunray_energy_costs +
    CP20_costs + CP20_energy_costs +
    server_costs + server_energy_costs

Based on this, we can make some realistic assumptions and calculate a potential savings for an organization of 100 people with an IT staff of 20.

We’ll start by assuming we’re talking a traditional office, such as an insurance firm, where their IT needs are moderate. We’ll assume that only IT needs high-end workstations, that they are able to get by on 12 servers (which is on the low-end as some organizations have up to 2 servers per employee), and that they are located somewhere where energy is relatively cheap, at 10c/kWh (roughly the national average in the US as of June, 2008). We’ll assume that they can buy lower-end hardware and get regular workstations for 600 with low-end 10,000 hour 17″ LCD monitors for 200, higher-end IT workstations for 1,200 with mid-range 10,000 hour 21″ LCD monitors for 400, and get by on mid-range Dell servers at 3,000 a pop. Furthermore, we’ll assume more-or-less industry-average power requirements of 124 watts per hour per regular workstation, 372 watts per hour per higher-end workstation, and 638 watts per hour per mid-range server. We’ll also assume that these are good corporate citizens that turn their workstations off every night when they go home, that energy costs are only going to increase 7% per year, and that the organization gets three years of useful life out of a machine and four out of a monitor.

We’ll then assume that each regular workstation can be replaced with a SunRay thin client, and that each core on the virtualized server can support five clients; that each high-end workstation can be replaced with a CP20 thin client, and that each dual-core on the virtualized server can support five clients; and that there is a 6:1 consolidation ratio using virtualization technology. Making these assumptions, we calculate that this organization is overspending on IT by over 40,000 a year! Greening their IT would allow them to hire another office administrator or sales agent! Plus, they’re unnecessarily harming the environment! The energy used by 100 workstations in 1 year is equivalent to 88 barrels of oil or 4,318 gallons of gasoline and it’s production results in 38 tons of CO2 and 13 tons of landfill waste!

If we extend the calculation out over 3, 5, and 10 year time horizons, we see that the numbers become very significant very fast.

Years 1 3 5 10
Traditional IT Cost 61601 187642 314096 632442
Green IT Cost 21371 64654 108014 216837
Green IT Savings 40230 122989 206081 415605

And this is a low-end estimate! If the organization needs higher-end, and costlier, workstations that suck up even more energy, and its employees never turn them off, and if they can achieve an 8:1 ratio on the SunRay’s (which is obtainable if all the workstations are used for the majority of the time is word-processing and e-mail) and a 5:1 ratio on the CP20’s (which is obtainable with the right server configuration), the cost savings double to over 80,000 a year, and to almost 1,000,000 over 11 years! That’s an awful lot of green for your average small business with only 100 employees!

Years 1 3 5 10
Traditional IT Cost 107661 329552 552395 1114620
Green IT Cost 21987 66403 110883 222425
Green IT Savings 85674 263149 441512 892195

And these might even be lowball estimates for your organization, depending on your true IT needs and optimal configuration. A recent implementation by the Green Data Center reduced the total IT energy costs for a small company by 93% a year (which, for a company with 250 machines, translates into roughly 29,000 a year in energy savings)! Another study found that a local college could replace 500 machines and save 300,000 in hardware and energy costs per year! And since the implementation cost was estimated at 303,000, this organization had an ROI of only 12 months!

So how do you save money? Like I said before, you start with a green audit that results in an executable action plan that will allow you to save money as soon as you CFO gives you the green light. One company you can call is NCS Network, operators of the Green Data Center who have significant experience with Green IT and who have helped clients across North America.

Furthermore, if you call NCS Network and mention that you heard about them on Sourcing Innovation, not only will you get 10% off their standard audit quotes if you book before September 30, 2008, but they’ve guaranteed me that the first 10 callers who mention Sourcing Innovation will receive a free Green IT consultation. You can call them toll free at 1-877-GREEN-60 or send them an e-mail.

So Go Green today and save!

For you number crunching types, you can download the spreadsheet I used to do the calculations, which I’ve outlined below, and plug in your own estimates to get a ball-park of your savings potential.

The full calculation for each element of your current IT costs are:

  • regular_workstation_costs = number_of_regular_workstations * (cost_per_regular_workstation /useful_workstation_life + monitor_cost / useful_monitor_life)
  • regular_workstation_energy_costs = number_of_regular_workstations * avg_watt_per_hour * avg_hours_per_day * avg_days_per_year * avg_cost_watt_hour
  • high-end_workstation_costs = number_of_high-end_workstations * (cost_per_high-end_workstation / useful_workstation_life + monitor_cost / useful_monitor_life)
  • high-end_workstation_energy_costs = number_of_high-end_workstations * avg_watt_per_hour * avg_hours_per_day * avg_days_per_year * avg_cost_watt_hour
  • server_costs = number_of_servers * (avg_server_cost / server_lifespan)
  • server_energy_cost = number_of_servers * avg_watt_per_hour * 24_hours_per_day * 365_days_per_year * 2.22_data_center_energy_overhead_factor1 * avg_cost_watt_hour

The full calculation for each element of the green IT costs are:

  • sunray_costs = number_of_sunrays * (300_per_sunray / 7_years_useful_life + monitor_cost / monitor_useful_life)
  • sunray_energy_costs = number_of_sunrays * 7_watts_per_hour * avg_hours_per_day * avg_days_per_year * avg_cost_watt_hour
  • cp20_costs = number_of_cp20s * (600_per_cp20 / 7_years_useful_life + monitor_cost / monitor_useful_life)
  • cp20_energy_costs = number_of_cp20s * 25_watts_per_hour * avg_hours_per_day * avg_days_per_year * avg_cost_watt_hour
  • server_costs = number_server_cores * avg_cost_per_core / server_lifespan
  • server_energy_costs = number_of_server_cores * avg_watt_per_hour * 24_hours_per_day * 365_days_per_year * 2.22_data_center_energy_overhead_factor1 * avg_cost_watt_hour

When estimating server cores in your Green IT solution, use the following calculation:

  • server_cores = sunrays/clients_per_core + cp20s/clients_per_core + current_servers/consolidation_factor

where SunRay clients per core will usually be between 4 and 8,
where CP20 clients per core will usually be between 2 and 5,
and where consolidation_factor will usually be between 5 and 10.

Note that power for workstations can be as high as 1,000w/h, with low-end typically between 120w/h and 180w/h, mid-end between 300w/h and 500w/h, and maxed-out development or gamer machines requiring as much as 1,000w/h. Note that server power requirements generally start at around 500w/h for low end servers, 700w/h for mid-range servers, and typically go up to 1,500w/h (or more) for high-end servers. In comparison, depending on what type of processor the blade uses, and whether or not you have a rack-mount cooling solution, power requirements per core can go as low as 32w/h (using a Xeon-chip and rack-mounted water cooling).

1 In an average data center, 55% of the power utilization is due to overhead from lighting, air-conditioners, UPS, etc.