A new way to predict the energy efficiency of cloud computing

Sentilla’s tool drills down into all of the cost metrics for a potential cloud customer — like buying equipment, personnel costs, maintenance fees, software licensing, as well as power consumption — and helps the customer determine whether adopting cloud computing is a good decision or not. But given the tool is granular enough to drill down into the effects of the cost of power consumption on the overall decision, it will be a valuable way to highlight how energy-efficient or not cloud computing can be on an individual basis.

Many people think cloud computing is a more energy-efficient choice in general compared to running in-house IT operations. Data center energy expert Jonathan Koomey has pointed out on our site that cloud computing is more efficient than in-house IT for reasons of economies of scale, diversity and aggregation, and flexibility among other reasons.

According to a report, created by research firm Verdantix and sponsored by AT&T, cloud computing could enable companies to save $12.3 billion off their energy bills. That translates into carbon emission savings of 85.7 million metric tons per year by 2020. Last year, Pike Research found that cloud computing could lead to a 38-percent reduction in worldwide data center energy use by 2020, compared to what the growth of data center energy consumption would be without cloud computing. And another study from Microsoft, Accenture and WSP Environment and Energy last year found that moving business applications to the cloud could cut the associated per-user carbon footprint by 30 percent for large, already-efficient companies and as much as 90 percent for the smallest and least efficient businesses.

Other studies have also found that cloud computing isn’t always the most energy-efficient computing option, and in certain instances, the cloud can be more energy-intensive than traditional in-office computing. A report from University of Melbourne researcher Rod Tucker and his team, which I wrote about for GigaOM Pro (subscription required), found that cloud computing can indeed save energy when it leads simply to the consolidation of servers, but looking at three different applications of cloud computing — storage, software and processing —  energy efficiency savings are negated in some scenarios.

Computing and the Internet consume a significant amount of the world’s electricity. According to Koomey’s latest research, the total electricity use by data centers in 2010 was 1.3 percent of all electricity use for the world, and 2 percent of all electricity use for the U.S. That wasn’t even as much of a growth as anticipated by many researchers, thanks to both the recession and data center operators embracing more energy-efficient choices like virtualization.