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PG&E and Sun rebate program gets mixed reaction

An offer by PG&E to give rebates to data centers that replace hardware with new Sun servers has caught the industry's eye. Some say it's a good start. Others think it's a publicity stunt.

The move by Sun Microsystems Inc. and Pacific Gas & Electric Co. (PG&E) to team up on an energy efficiency program has some in the utility and environmental industries giving kudos, while competitors in the server market say they aren't that impressed.

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The announcement by Sun earlier this month includes the offer of a rebate to PG&E customers who replace old servers in their data center with Sun's new Sun Fire T1000 or T2000 machines.

Under PG&E's Nonresidential Retrofit program, customers can receive a one-time cash rebate between $700 and $1,000 for each new server they buy. Combined with Sun's claim of $500 energy savings per year over competing platforms, the collaboration could mean a solid cut in the price of buying servers. The list price for a T1000, for example, is $3,995.

Andrew Fanara, leader of the Energy Star product development team at the federal Environmental Protection Agency (EPA), said the program is a good start. Next month, he plans on visiting with other utilities to talk about energy efficiency in general and foresees other server vendors and utilities starting similar programs.

Fanara said that many utilities are trying to offset the amount of fossil fuel generation they're creating, and giving customers rebates for saving energy is one way of doing that. And though the Sun/PG&E program may not have a huge impact on the energy market on its own, it could steamroll as others take notice and follow suit with their own programs.

"Obviously what's happening is a good thing," he said. "First attempts at these types of programs might be unwieldy, but over time companies and utilities can participate and transform the market at a rapid pace."

There's no doubt that competitors will take notice. At the Northeast utility NStar, for example, spokesman Michael Durand said it hadn't heard of the Sun/PG&E program but were interested in what it was about. NStar and other utilities like PG&E are already part of a group called 80 Plus, which offers incentives to computer manufacturers to build servers and desktop computers with power supplies that are 80% efficient or better.

Durand said that NStar also has programs that include incentives for customers that install high-efficiency cooling devices in their data centers.

Bob Doherty, data center manager at Beth Israel Deaconess Medical Center in Boston wants to go after energy credits through NStar as is being done with PG&E. But in talking with other data center managers, Doherty found that they can't justify replacing equipment, because there isn't enough payback to do so.

Still, depending on what kind of program its utility sells, Doherty said it may be worth it.

"PG&E is doing exactly what I hope NStar and other local energy providers offer," he wrote in an email. "I have been told that NStar does offer energy conservation credit -- we are proactively investigating this."

Others weren't as optimistic in their analysis of the Sun and PG&E move, however.

Hewlett-Packard Co., (HP) for one, isn't impressed. Olivier Helleboid, vice president of adaptive infrastructure, said HP is more focused on cutting the cost of an entire system, adding that the greatest reductions would come from looking at overall operations.

Lin Nease, chief technology officer of HP business critical systems, called it a publicity stunt.

"If you look at the lifecycle, the rebate is a miniscule part of the equation," Nease said. "Sun and PG&E get PR [public relations] on this. But all of us are dealing with the issue of power management in servers."

Mark Feverston, Unisys director of enterprise servers and storage, argued that offering the rebate on the Niagara servers wouldn't have a large market impact because he felt that demand for Unix-based servers was declining. He added that he thought the growth of virtualization, not single servers themselves, would drive up power efficiency and push down the total cost of ownership.

Let us know what you think about the story; e-mail: Mark Fontecchio, News Writer

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