Energy charging model drives green IT improvements

Lehman Brothers IT chief reveals how it is charging departments for both the IT and the energy that they use

Investment baking giant Lehman Brothers is pioneering an innovative new management model designed to help drive greater energy efficiency across its IT infrastructure.

Speaking at a roundtable event hosted by Cisco yesterday, Michael Fahy, head of infrastructure in Europe for the bank, said that the company had adopted a model for charging departments for the net power consumption of the IT applications they use.

Internal pricing models that charge departments for the IT applications and services they use are a relatively common means for large firms to emphasise the value delivered by their IT infrastructure and ensure a tight reign is kept on costs.

However, Fahy maintains that it is rare for such models to also account for the energy used by the IT infrastructure and consequently the wider business is often unaware of the full financial and environmental costs associated with the applications they use.

"It used to be that we would charge based on the amount of space an application would take up [in the datacentre], but now we have expanded that to also charge based on the power the application uses," he explained. "We look at the servers, storage, network technology, and so on that it takes to run a given app, work out the net power consumption of the app, and then develop a charging mechanism based on that."

Fahy said that as a result departmental chiefs can see which applications are the most efficient, which in turn increases pressure on the IT team to deliver as energy efficient infrastructure as possible.

"We end up driving our suppliers [to deliver greener products]," he added. " Every meeting we now have with key suppliers contains conversations about efficiency."

Lehman Brothers is confident that the approach has not only helped curb emissions, but also results in significant costs savings.

"This is not an altruistic model," argued Fahy. "It makes good business sense and is about driving efficiency at a time of rising energy costs."