How to Optimize Your Data Center Energy Usage for the New Year

The new year is a great time to review energy usage in your data center and find ways to improve efficiency. Energy costs are rising, and sustainability is becoming a bigger priority for businesses.

Cutting energy waste can reduce expenses, meet new regulations, and lower your environmental impact. This article will go over simple, effective strategies to improve data center energy efficiency in 2025.

Why Data Center Energy Use Matters

Data centers worldwide use a significant amount of electricity. According to the International Energy Agency (IEA), they consumed about 200 terawatt-hours (TWh) in 2022, which is roughly 1% of total electricity demand.

With more businesses relying on cloud computing, artificial intelligence, and online services, energy use will likely increase in the coming years.

There are several reasons to focus on energy efficiency:

• Lower Costs – Reducing energy waste can lead to big savings.
• Regulatory Compliance – Many governments are enforcing stricter energy efficiency rules.
• Sustainability Goals – Companies that reduce energy use improve their environmental impact.

Starting the new year with an energy efficiency plan can help your business save money and stay ahead of changing regulations.

Steps to Improve Data Center Energy Efficiency

1. Conduct an Energy Audit

Before making changes, it's important to understand where energy is being wasted. An energy audit helps identify problem areas and provides data to guide improvements.

Tools like Power Usage Effectiveness (PUE) monitoring systems and real-time energy tracking software can give insights into where your data center is losing efficiency.

2. Optimize Cooling Systems

Cooling systems can account for nearly 40% of total data center energy use (U.S. Department of Energy). Many businesses cool their equipment more than necessary, wasting energy.

Some ways to improve cooling efficiency include:

• Raising temperature setpoints – Modern equipment can operate at slightly higher temperatures without issues.
• Using hot and cold aisle containment – Separating warm and cool airflows reduces unnecessary cooling.
• Installing liquid cooling systems – These are more efficient than traditional air conditioning.

Google has reduced cooling energy by 40% in some data centers using AI-powered cooling adjustments, but even without AI, small changes can lead to major savings.

3. Upgrade to Energy-Efficient Hardware

Older servers and storage systems use more power than modern, energy-efficient models. Consider replacing outdated equipment with:

• Energy Star-certified servers – These use up to 30% less electricity.
• High-efficiency power supplies – Reduce energy waste.
• Flash storage instead of HDDs – Requires less power and generates less heat.

Upgrading hardware is an investment, but the long-term savings on electricity bills make it worthwhile.

4. Use Virtualization and Optimize Server Loads

Many businesses run too many underused servers, wasting energy. Virtualization allows multiple applications to run on fewer machines, reducing power needs.

Some strategies to improve server efficiency include:

• Consolidating workloads – Avoid running extra servers that aren’t needed.
• Using AI-driven workload balancing – Adjusts workloads based on demand to avoid wasting energy.
• Turning off unused equipment – Many businesses leave servers running that aren’t being used.

Companies that improve server utilization can cut energy use by up to 60%.

5. Switch to Renewable Energy Sources

Many companies are reducing their reliance on fossil fuels by switching to renewable energy. For example:

• Amazon Web Services (AWS) aims to run on 100% renewable energy by 2025.
• Microsoft plans to be carbon-negative by 2030.

Options for businesses include:

• Purchasing renewable energy from suppliers.
• Installing solar panels to power part of the data center.
• Using battery storage to store excess solar or wind energy.

Switching to clean energy can reduce long-term costs and improve sustainability efforts.

How Energy Efficiency Helps Your Business

Lower Costs

Energy efficiency directly affects operating expenses. A 1-megawatt (MW) data center that reduces its PUE from 2.0 to 1.5 can save about $500,000 per year in electricity costs.

Improved Sustainability

Reducing energy waste lowers carbon emissions and helps companies meet Environmental, Social, and Governance (ESG) goals. Many customers and investors prefer businesses with strong sustainability practices.

More Reliable Operations

An energy-efficient data center is less likely to have overheating issues, power failures, or downtime. These improvements increase uptime and make operations more reliable.

Making Energy Efficiency a Long-Term Plan

Monitor and Adjust Energy Use Regularly

Energy audits should be done at least once a year to track improvements and identify new issues.

Train Employees on Energy Best Practices

Encouraging employees to be aware of energy usage can lead to long-term savings.

Work with Energy Experts

Partnering with energy consultants or managed services can help find additional ways to reduce waste and lower costs.

Conclusion

The new year is the perfect time for businesses to reassess their data center energy usage. Reducing energy waste not only lowers costs but also improves reliability and helps meet sustainability goals.

Implementing changes like optimizing cooling, upgrading hardware, using virtualization, and transitioning to renewable energy can make a significant impact.

Setting clear efficiency goals and continuously monitoring power usage can lead to long-term savings and a more sustainable operation in 2025 and beyond.

If you're ready to take control of your data center’s energy efficiency, Packet Power can help. Our power and environmental monitoring solutions provide real-time insights to optimize energy usage, reduce waste, and enhance operational efficiency.

Contact Packet Power today to see how we can help your business succeed with smarter energy management.