Economies Of Scale Impact Data Center Costs

The results of the first Cost to Support Compute Capacity Benchmark Study have been released by Emerson Network Power in conjunction with the Ponemon Institute.


https://facilityexecutive.com/2016/08/economies-of-scale-impact-data-center-costs/
The results of the first Cost to Support Compute Capacity Benchmark Study have been released by Emerson Network Power in conjunction with the Ponemon Institute.
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Economies Of Scale Impact Data Center Costs

Economies Of Scale Impact Data Center Costs

The results of the first “Cost to Support Compute Capacity Benchmark Study,” the latest report in the Data Center Performance Benchmark Series, have been released by Emerson Network Power in conjunction with the Ponemon Institute.

data center costs
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The study analyzed annual costs for 41 North American data centers. Costs were reported by participating organizations in four categories: amortized plant, amortized IT assets, operating, and energy. In addition, participating organizations reported on IT load, number of racks, average rack density, and data center square footage. Using this data, the Ponemon Institute calculated an average cost to support 1 kilowatt (kW) of compute capacity for each of five data center size ranges.

Major findings from the study include:

  • Average annual cost/kW range from $5,467 for data centers over 50,000 square feet to $26,495 for data centers between 500 and 5,000 square feet.
  • Cost/kW decreases as data center size increases, with the largest decrease occurring from the 500 to 5,000 square foot range to the 5,001 to 10,000 square foot range (64 percent). Costs continued to decline as data center size increased: In the 10,001 to 25,000 square foot range, cost/kW were 47 percent lower than in the 5,001 to 10,000 square foot range; In the 25,001 to 50,000 square foot range, cost/kw were 23 percent lower than in the 10,001 to 25,000 square foot range; In the over 50,000 square foot range, cost/kW were 21 percent lower than costs in the 25,001 to 50,000 square foot range.
  • Economies of scale were observed in all four cost categories. Energy costs experienced the largest decrease, with a 180 percent difference between energy costs/kW for data centers in the smallest size range compared to the largest. Operating costs showed a 129 percent difference per kW in the largest data centers compared to those in the 500 to 5,000 square foot range.
  • Operating costs account for the largest percentage of data center costs across all size ranges, followed by energy costs. Energy and operating costs together account for 80 percent or more of annual data center costs.
  • Cost/kW decreases with rack density. Data centers with an average rack density of 8.5 kW had a cost/kW 68 percent lower than data centers with an average rack density of 4.5 kW.

“With the variety of outsourcing options available today, it’s more important than ever for data center operators to understand the costs associated with supporting compute capacity and the major components of those costs,” said Peter Panfil, vice president of global power for Emerson Network Power. “This report provides a template for data center operators to get a handle on their costs and make informed decisions about future outsourcing, while evaluating technologies and best practices that can lower their costs.”

This is the fourth volume in a series research reports from Ponemon and Emerson Network Power providing industry benchmarks and insight into the key challenges and decision points organizations face as they construct an IT infrastructure to support internal users, partners, suppliers and customers in the digital age. The full report, along with other reports in the Benchmark Series, is available online.

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