Unique Toronto Hydro program pays customers who save power

Utilities serving the Greater Toronto Area hope to see a power savings incentive program expanded to all of Ontario, say company managers.

Toronto Hydro Corp. and PowerStream Inc. pump electricity to Canada’s largest city and its surrounding suburbs. Since October 2009 the utilities have been doing something most companies would consider bizarre and bad for business — paying customers to not use their product.

That’s how Steven Walker, director of IT infrastructure at Toronto Hydro, describes the program at IT360, a Toronto-based conference.

“It’s a unique value proposition,” he says. “The idea is to help data centres cut their electrical consumption.”

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The Data Centre Incentive Program received a boost in 2010. It will now pay customers at a rate of $800 per kilowatt they are able to reduce, up to half of a energy savings project’s cost. On top of that, companies can receive $4,000 just to conduct an energy assessment of their data centre.

A chunk of funding is delivered in year one of the project to help ease the pain of investment.

The program exists because utilities are facing huge demand, as well as costs to generate greater power to meet that demand. In addition, the Ontario government has committed to closing all coal-fired generating stations by 2014.

“It is extremely polluting to continue to harness coal-fired generators and costs billons to build new ones,” Walker says. “It’s easier, greener, and better for us to get you to conserve usage.”

Now the utilities are looking for ways to extend the program to the rest of the province. They hope it can be expanded by 2011, says Patrick Guran, chief conservation officer at PowerStream. But they’re not sure just how that will be done yet, and the Ontario Power Authority will need to be on board.

“We’d like to consolidate this program and offer it to different parts of the province,” he says. “We’d like to break it down to prescriptive type programs that can be offered across the province and some custom programs that may be available to large urban centres where huge data centres are located.”

Early adopters of the program have seen hundreds of thousands of dollars in savings in some cases.

Chip manufacturer Advanced Micro Devices Inc. tapped the program to do a server consolidation project at its Richmond Hill, Ont.-based facility last year. It was able to reduce 1,150 servers down to just 312.

“They were incented just over $200,000, plus they also save $170,000 year-over-year on energy costs not incurred,” Walker says. “So it’s not just the cheque we cut them, it’s the savings they can glean afterwards.”

Toronto Hydro has been eating its own dog food on this one. It has an ongoing server virtualization and consolidation project since 2008 and is on track for 70 per cent of its servers to be virtual this year. It has also tailored cooling measures for its data centre, including liquid cooling.

IT intensive projects such as virtualization, consolidation, and more are among the most effective measures to cut energy usage, but aren’t the only ones. Non-IT systems that can be improved include fire suppression and high-security systems, power supply, lighting measures, and air flow systems.

A few simple changes can start saving kilowatts, Guran says.

“You can imagine – if you unplug the hot plate on your stove, that saves 1 kW right there,” he says. “Just the stand-by power of devices is probably about 10 per cent of the load throughout North America.”

Ontario is among the highest power consumers in the world, he adds. There’s lots of room for improvement, even when compared to other northern countries, such as Norway or Sweden.

“Sometimes it’s just cleaning up cabling under a raised floor,” Walker advises. “Sometimes its just making sure your tiles are positioned properly in front of racks and those racks are venting properly.”

For now, companies not served by Toronto Hydro and PowerStream can still contact the utilities to hear more information about the program.

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