Diesels fuel always-on service
Amid the quest for more bandwidth, faster networks and petabytes of storage capacity, the Internet still demands an old-fashioned commodity: horsepower.
Lots of horsepower. And Old Economy companies like Caterpillar and Cummins are happily providing New Economy enterprises with the muscle they need.
It's one of the strange but true equations of the Internet Age: More bandwidth equals more big diesel engines. Every major new data center, telecommunications switching facility and information technology center must have a backup power system. And the cheapest, most reliable technology for that task was invented 107 years ago by French engineer Rudolf Diesel.
"We just got a significant order from a long-distance company for 148 of our 2-megawatt generator sets," said John Heckelsmiller, a senior market manager at Cummins' Power Generation division. Heckelsmiller said the company is seeing double-digit increases in annual demand for its large generators. But getting one of those 2-megawatt diesel generator sets - each of which uses a 60-litre, V-16 engine that produces 2,500 horsepower - will take a while. Though Cummins' engine factory in England is running at full output, customers have to wait up to three months for delivery.
Caterpillar, the mining and construction equipment giant, has responded to the surge in demand for its big generator sets by doubling the capacity of its engine manufacturing plant in Lafayette, Ind. But demand is so great that Internet companies still must wait five to six months before they can get one of the company's 2-megawatt generator sets - at a cost of US$500,000 each. Demand for Caterpillar generators has been growing at 20 percent per year, and much of that demand is coming from Internet-related businesses. Larry R. Wilson, Caterpillar's director of strategic planning for electric power, estimated the company now sells some $200 million worth of generator sets per year to the Internet sector, and demand is "growing faster than any other segment" of Caterpillar's customer base, he said.
Although Internet data centres are spending heavily on generators, the owners of the expensive machines hope they never have to use them. Electricity produced by on-site diesel generators can cost three times as much as power bought from the grid.
But data centre owners have few choices. Fuel cells are still too small and too expensive. Small natural gas turbines are becoming more common, but have yet to capture significant market share. "Right now, diesel is the only choice," said Ed Doherty, a senior product manager at American Power Conversion, a leading manufacturer of uninterruptible power supply systems.
Indeed, backup power equipment has become as essential as fibre-optic cable. Companies vying for a share of the colocation and data center business are "differentiating themselves in the market by saying our redundancy and reliability is unsurpassed," said Elizabeth Moore, a program manager in the energy communications practice at The Yankee Group. "Power supply plays a very big part of that." Moore recently visited a 60,000-square-foot data centre that was equipped with rows of backup diesel generators worth millions of dollars. The power redundancy provided by the diesels is one of the most expensive parts of a data centre, Moore said. "But for the companies involved, cost is no object," she said. "They simply have to have the horsepower to keep the lights on."
