The U.S. Environmental Protection Agency recently proclaimed that data centers consumed 61 billion kilowatt-hours of electricity in 2006. That's roughly 1.6 percent of total U.S. electricity consumption and is worth about $4.5 billion. Assuming current trends continue, by 2011, the national energy consumption by data centers is expected to nearly double, making energy efficiency a top priority for CIOs.

One technology that can help companies increase efficiency is virtualization, which can play multiple roles in the data center.

Virtualization makes it possible, for example, to divide a single server into smaller virtual servers or pool smaller, individual machines so they can perform as one larger system. Gartner estimates that more than 90 percent of companies using virtualization are doing so to reduce x86 server space and costs. In fact, the company estimates that virtualization cut the x86 server market by 4 percent in 2006.

Power savings can be even greater when addressing storage assets. Storage resources -- which IDC says are growing 50 percent per year -- are among the largest consumers of energy in the data center, in most cases consuming 13 times more power than processors. What's more, use of storage assets is often 25 percent or less, making this environment almost as inefficient as x86 servers. Storage virtualization can drive up use rates from 25 to 60 percent or more.

Applying virtualization technologies across all system assets, including servers, storage, and network devices, can allow companies to tap into unused capacity without adding resources that draw more power. The most energy-efficient equipment is equipment that's no longer in use, whether it's a server, a router, or a storage device.

Achieving that, however, requires centralized management of virtual and physical devices because while virtualization helps address cost through consolidation of physical resources, it adds complexity by increasing the number of virtual resources that need to be managed.

Gaining a more accurate understanding of the relationships among physical and virtual resources enables administrators to manage the infrastructure in a more integrated, holistic way.

Systems-management virtualization tools that manage all resources -- physical and virtual -- can help manage the resources in an integrated fashion from a single dashboard, significantly reducing the number of tools required and the cost of administration to support multiple types of servers. These tools can also help relocate virtual servers automatically in order to take advantage of lower utilization rates and help administrators inventory server and storage devices, monitor the health of these devices, manage maintenance, and prevent downtime.

However, a common problem organizations face is the difficulty in determining how and for what purposes employees are using virtual resources. To drive a successful energy-efficient program, you should be able to identify which resources are used and whether they are physical or virtual.

IT chargeback methodologies can also help improve IT accountability and resource alignment. Existing tools, for example, can monitor use of applications, servers, and other IT resources so organizations that wish to consolidate and virtualize servers can accurately charge for related use.

Factoring virtualization into chargeback processes not only enhances the process by more tightly mapping companies' resources to business units, but also allows them to stretch their budgets to focus on energy-efficient programs.

The energy issue hasn't escaped the attention of power companies or government organizations. More than 80 local utility and state energy-efficiency programs are offering rebates for increasing energy efficiency. Pacific Gas and Electric of California, for example, has approved a plan to reimburse part of the costs for server- and storage-consolidation projects, including software, hardware, and consulting, up to a maximum of $4 million per customer.

An energy-efficient data center is not optional today -- it is a necessity. And virtualization technologies can lead to power savings that result from consolidating hardware and improving utilization rates, providing you also adopt proper management tools and methodologies.

Network World is an affiliate of InfoWorld. Lechner is vice president, IT Optimization at IBM. He can be reached at GoGreen@us.ibm.com.