Why Tiny Differences In Efficiency Make A Big Difference In Costs

Total cost of ownership (TCO) calculations are often used in IT. However, when it comes to designing data centres, it’s important to make sure those calculations cover the entire lifespan of the equipment.

Lifehacker’s coverage of Data Center World 2014 is presented by the Microsoft Cloud, providing flexible enterprise cloud solutions for business.

In a presentation at Data Center World 2014, GE Critical Power director Harry Handlin highlighted the differences in total cost that a UPS with 93 per cent, 94 per cent and 96.5 per cent efficiency would accumulate over a 10-year period. “TCO hasn’t been that well used in the data centre industry,” Handlin said.

Even small differences in efficiency result in a much higher cost. While it’s arguable that the purchase cost would be lower for the less efficient equipment, that doesn’t alter the main point. (The calculation is based on a 10 cent per kilowatt hour price, which is cheap by Australian standards; at our power prices, the difference would be more pronounced.)

“You’re trying to minimise your cost across the life of the data centre,” Handlin said. “You could pay for the cheapest piece of equipment based on price, but price and cost may not be equal. Not using TCO when purchasing power equipment could cost you millions of dollars.”

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