With the hike in energy costs this autumn and winter, many businesses are having to find new ways to reduce their electricity consumption across the board.
Previously, most businesses have probably not been particularly focused on the running costs associated with their on-premises hardware and software. Your business may not even have looked into exactly how much you are spending on electricity to run your servers 24 hours a day, as well as the lighting and air-conditioning needed to keep everything at the right temperature. However, the amount of energy required to power this equipment represents a sizeable overhead. One way of reducing your costs is by moving from an on-premises IT infrastructure to a cloud solution, which could decrease your energy consumption significantly and could save you money.
Benefits of cloud over on-premises IT
If you have an on-premises IT infrastructure, your organisation’s electricity costs are likely to increase substantially due to the amount of energy required to run all of your software. Moving your storage to the cloud and outsourcing to a specialist cloud provider will allow you to transfer the responsibility of running your own hardware and software over to your provider.
According to Microsoft Corporation and WSP Global Inc., cloud computing is 93% more energy-efficient than on-premises data centres. Furthermore, research by Berkeley Lab and Northwestern University, funded by Google, found that businesses could save between 60% and 85% in energy costs when they change over to cloud-based services.
Due to the current energy crisis, the supply of energy may become unstable, particularly over the winter, with the possibility of blackouts in the worst case scenario. If this does happen, a cloud provider is more likely to have better resilience in terms of back-up generators and equipment, ensuring your business can keep working.
How do cloud providers keep costs down?
As specialist cloud providers are dealing with numerous customers, the cost of the energy that they are using to run their servers is shared between their customers so they benefit from economies of scale. They are also likely to get wholesale energy rates which means their energy will be less costly per unit than the average business. Since their business is IT, they will be more likely to be using the latest energy efficient servers within their data centre.
