Power Struggle: IT Shops Battle Costs

With the deregulation of the power industry under way, IT managers are facing another enterprisewide challenge: how to get a better grip on electrical energy usage in light of an inadequate number of power plants and their capacity, price spikes, and service interruptions, and an inconsistent deregulation landscape across the United States.

A number of vendors have been readying systems and software targeted at helping users attain more control regarding energy usage. "The main driver for the company is to get control of a key component of their cost structure," and gain competitive advantage in the marketplace, said Andrew Glassberg, a partner at Andersen Consulting Inc., based in Detroit.

Enterprises might find savings as well as a stronger bargaining position when they put their energy usage up for bid on energy trading markets, Glassberg said. Either way, "they'll need energy management software to get a reading on consumption," he said.

The solutions in this emerging market include extensions of metering products, integrated bill-management software, and hardware solutions that poll energy usage data.

This week, Samsung Data Systems America (SDSA), based in San Jose, Calif., announced that it would work with Energy Information Technologies (EIT), in Burlingame, Calif., to develop an Internet-based system that promises to provide energy users with access to account data via the Web.

That information can be used to adjust consumption. The system will offer a time-of-use meter, called the "i-meter" from EIT, to capture customer usage data and transmit it to energy service providers via the Internet.

Taking a software suite approach, Alameda, Calif.-based Silicon Energy recently unveiled its latest Enterprise Energy Management software, EEM Suite Version 2.0, a real-time, Web-based system that provides enterprise-level energy cost analysis and procurement capabilities, forecasting, and bill management.

There have also been acquisitions by vendors anticipating the growing demand for energy management solutions. One component of ABB's August acquisition of Oakland, Calif.-based Energy Interactive, an energy information software vendor serving energy companies and their customers, was to provide customers with more billing and Internet-based energy usage information services.

As for expected savings, "the early estimates are 15 [percent] to 20 [percent] to 30 percent, depending on how well [enterprises] are managing it now," Glassberg said.

Industry analysts have lower estimates -- 7 percent to 14 percent of operations, according to Ethan Cohen, an analyst at Aberdeen Group, in Boston. Karen Edge, an analyst at Meta Group, in Stamford, Conn., said that even a drop of a few percentage points would be significant, especially for large enterprises.

And "certainly others -- even mom-and-pop businesses -- will look to trim their energy consumption," Edge said.

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