Cooler data centers could save millions for IRS

But agency disputes auditors' figure because it does not consider cost of improvements

Federal auditors today said the Internal Revenue Service could save more than $3 million over four years by improving air cooling circulation at two data centers.

However, IRS officials said that savings estimate may be inflated because it does not take into account the cost of implementing the improvements at the centers in Memphis, Tenn., and Martinsburg, W.Va.

Data centers can be more than 40 times as energy intensive as conventional office buildings because of the high power requirements for the computers and the equipment used to cool them.

Although the IRS has some environmental management policies in place for its 11 data centers, it has not dealt with energy efficiency, according to the report released today from the Treasury Inspector General for Tax Administration (TIGTA).

“The IRS does not have policies and procedures for improving energy efficiency in the data centers or for implementing data center energy efficiency best practices,” the report said. “We estimate that the IRS could potentially realize savings of $3,172,872 over 4 years, at 2 sites, by implementing best practices to improve airflow management." The savings were calculated at $793,218 per year. 

Total savings for all 11 data centers would be even higher, the TIGTA audit said, but the exact amount could not be estimated because the energy consumption information was not available on the other nine centers.

"It is imperative that the IRS become more energy efficient to save taxpayer dollars and reduce the nation's consumption of oil, coal, and other natural resources," Russell George, Treasury Inspector General for Tax Administration, said about the report.

The audit made seven recommendations, including establishing policies and procedures to determine which best practices to implement, measuring the energy use of IT equipment, reducing excess data center space and conducting energy audits.

IRS officials agreed with most of the recommendations; but they disagreed with the estimate of the proposed savings.

“While air-flow management improvements could certainly lead to energy-related savings for IRS, we believe the estimated figure in the outcome measure may overstate savings that are likely to accrue from such improvements,” David Grant, chief of agencywide shared services at the IRS, wrote in a response to a draft version of the audit on April 12.

The TIGTA estimate does not factor in the cost of the desired improvements, does not take into account energy measures already in place, and estimates energy savings at 50 percent, which is the upper limit of what might be possible, Grant wrote.

About the Author

Alice Lipowicz is a staff writer covering government 2.0, homeland security and other IT policies for Federal Computer Week.

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