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When Mal Griffin, chief information officer of Interior Health Authority in Kelowna, B.C., decided to try server virtualization to free up space in the organization's standing-room-only data centre, he managed to do more than that. Not only was he able to pack the performance of 70 servers into six, energy consumption for that area of the centre dropped by 80 per cent.

"With more than 300 servers already in place, we had no physical room to grow," he says.

Some of the original servers were running at about 20 per cent capacity, so virtualization made a lot of sense. The company pushed capacity to 60 per cent or higher for each machine, reducing the physical space needed and shrinking heating and cooling requirements as well.

Server virtualization is commonly achieved through software that divides a single physical server into separate operating environments, with each "virtual" machine running its own applications.

Traditionally companies have dedicated servers to such applications as e-mail and the Internet, and most run at low utilization rates (well below 20 per cent in some cases). Virtualization reduces the number of servers needed while increasing utilization levels for each device.

Mr. Griffin confesses that reducing power consumption was not a prime consideration when he first explored server virtualization, although he is delighted with the outcome. "Our big concern was growing our server capacity without adding to our space," he says.

When it comes to justifying the investment in virtualization, energy savings are not always the top motivator for IT managers, says Brian Down, chief technologist and principal engineer for Sun Microsystems of Canada Inc., based in Markham, Ont.

"A lot of people at the [IT] departmental level aren't paying for power consumption, so they tend to focus on the other benefits [of virtualization], such as capacity and utilization," says Mr. Down.

But an 80-per-cent drop in utility costs certainly attracts the attention of those responsible for the operating budgets.

Demand for server and storage capacity is growing by leaps and bounds, and energy prices are rising. Governments are demanding more accountability for consumption. And some parts of the world simply don't have the power capacity to meet the growing needs of data centres.

Three years ago Mr. Down met with a banking company in Tokyo that had maxed out its data-centre capacity - it had simply run out of power.

"When I came back to Canada, I told executives at a Calgary firm about the situation. They started looking at each other and told me the situation was exactly the same here. The fact is, when data centres were built 10 or 15 years ago, no one envisioned the level of power consumption we're seeing today."

In fact, a 2006 report from the research firm IDC estimated that by 2008 the cost of powering a server would exceed the cost of the server itself.

"I'd say [energy savings] is where virtualization can deliver the biggest bang for the buck, because it dramatically reduces power and cooling requirements," says Bogomil Balkansky, the senior director of product marketing for VMware Inc., the market leader for virtualization software, based in Palo Alto, Calif.

"Today's servers are the equivalent of gas guzzling SUVs. They're powerful pieces of equipment that chug along 24/7 and operate at only a small percentage of their capacity," Mr. Balkansky says. "So, do you want to run 100 applications on 100 servers under the old paradigm, or run the same 100 applications on 10 servers for 90-per-cent reduction in energy costs? The difference is that dramatic."

He estimates that for every application run on a virtual server, companies can save 7,000 kilowatt-hours of electricity a year. That's about $500 a year per machine, depending on electricity costs.

Mr. Down adds that energy costs can double when you factor in the cooling systems needed to dissipate the heat generated by the equipment. "Depending on the power of the machine, it could cost you up to $2,000 a year to run each one," he says.

Virtualization should be on business's radar screens if it isn't already, says Don Lee, chief executive officer of Gibraltar Solutions Inc., a professional services company that focuses on virtualization and is based in Mississauga, Ont.

"In the next two years we are going to see a lot of large enterprises that haven't started on virtualization forced in that direction by the high cost of running their data centres," says Mr. Lee.

Energy costs have driven the rise in server virtualization adoption in recent months, says Jason Bremner, director of infrastructure hardware research for IDC Canada in Toronto. "Basically you're buying and powering one system when it used to be 10."

IDC says that 49 per cent of large businesses in Canada - those with 500 employees and up - are using virtualization to some extent and are planning to increase that in the next six months.

Other devices can benefit from virtualization as well.

"It's not just servers," says Jose Iglesias, vice-president of global solutions for Symantec Corp in Mountain View, Calif. "Storage and desktop systems are other areas that can benefit from energy savings through virtualization."

Desktop PCs, for example, could be replaced with "thin" terminals consisting of just a monitor, keyboard and mouse - no energy-hogging CPU - using virtualization technology, says Mr. Iglesias.

Kelvin Cheung, president of Business.ca Inc., a provider of hosted custom applications and technology platform services based in Markham, has been working on his company's virtualization strategy since last August.

"Lower footprint and energy savings are definitely big savings for us," he says, noting that Business.ca has 50 virtual servers running on five actual units. "Power costs are about 20 per cent of what they used to be."

Whether someone in IT is trying to free up space or a company is promoting its image as a good corporate citizen, the savings will be substantial, says Mr. Down.

"With virtualization you're saving a hell of a lot of bottom line costs and energy - along with that extra $100-million you would have had to spend to build a new data centre."

Greening the

IT workhorse

Power use by data centres in the U.S. has doubled since 2000.

Servers account for 23 per cent of CO2 emissions among IT equipment. Personal computers account for 40 per cent.

In 2009, 70 per cent of companies will count energy costs as their second-highest operating expense.

The energy used by a rack of 12 servers is equal to the peak demand of 30 homes in California.

Every server removed or powered down saves about 12.5 tons of CO2 emissions a year, the equivalent to taking 1.5 cars off the road.

Sources: VMware Inc., Gartner Inc., Symantec Corp.