Cloud Computing Energy's Efficiency Problems

Over the years, cloud computing has grown to become an indispensable aspect of modern IT infrastructure. Initially, organizations used to rely on cloud services for data storage among other backup needs. Today’s organizations rely on cloud computing to deliver nearly all their core services. Considering these developments, it’s worth focusing on how the demands of cloud computing are influencing power consumption in data centers. 

The growth of the cloud computing industry

Statistics show that the global cloud computing industry was projected to hit $250.05 billion in 2021 and reach the $791.48 billion mark by the year 2028. The high growth of the cloud computing industry is attributed to several factors such as the surge in internet penetration, the digital transformation across various industries, and the large consumption of data in various verticals. The increased adoption of 5G, Artificial Intelligence, and the Internet of Things (IoT) are expected to further propel the growth of the cloud computing industry. 

With the inception of the global pandemic, the growth of the cloud computing industry was threatened by the fact that most businesses were affected drastically. This led to the stifling of innovation, suppression of profits, and dried cash flow. Both the software development and IT industries, which are the major players in the cloud computing industry, were affected by the unforeseen outbreak. 

Surprisingly, the impact of the outbreak on both the software development and IT industries was relatively low. This is attributed to the growing number of people working from home that has made organizations significantly increase their spending on Desktop-as-a-service (DaaS) and Infrastructure-as-a-Service (IaaS). This implies that more business is being conducted remotely through email among other collaboration tools, thereby, driving the growth of the cloud computing industry even further. According to Business Insight, the cloud computing industry grew by 13.7% in 2020. 

The cloud computing industry will continue to grow because most organizations are focused on upgrading the capabilities of their cloud computing as well as introducing new cloud solutions and services. All these are in the name of strengthening their position in the cloud computing market. Also, organizations are increasingly engaging in mergers and acquisitions to enhance their cloud capabilities and strengthen their market position. For example, Google LLC acquired Elastifile, a cloud storage provider, in July 2019. The essence of this acquisition was to expand the cloud-based file storage capabilities to suit its rising demands for cloud-based computing. 

Cloud computing and immense energy demands

In cloud computing, data centers are the most prominent. This is where the servers for storing, retrieving, and executing data are stored. In a typical data center, you expect to find servers, air conditioners, cables, etc. On average, data centers that host the components of cloud computing often release huge amounts of CO2 to the environment. 

In fact, one of the main challenges facing cloud computing is energy optimization and utilization. This is the reason why the concept of green cloud computing came into existence. Green cloud computing is the practice of designing, manufacturing, engineering, and disposing of computing resources with minimal damage to the environment. Some of the measures taken by organizations to make their cloud computing more environmentally friendly include:

  1. The use of renewable energy sources
  2. Reusing heat from the computer servers to warm up nearby buildings. 
  3. Making data centers more energy-efficient.
  4. Ensuring all hardware is properly recycled once it can no longer be used. 
  5. Use of hardware with a long lifespan since they contain less toxic materials, such as the Bi-Direction, Bi-Polar Junction Transistor (B-TRANTM) developed by Ideal Power.

All cloud service consumers expect to have a reliable service. Data centers have therefore been established all over the world to satisfy consumer expectations. A typical data center will contain thousands of servers. In other words, a small amount of workload to the server will need about 50% of the power supply. To ensure that the load is balanced and the services are reliable, cloud service providers often opt to keep their servers ON and running all the time. The constant power supply to the thousands of servers in data centers requires a huge amount of energy which simultaneously increases the cost of investment. Also, research has shown that a larger amount of energy is consumed in transporting data compared to when the data is stored. 

How to solve energy inefficiency problems in cloud computing systems

There are two common ways through which cloud computing systems waste a huge amount of energy; idling servers in data centers and server overload. There are a few techniques that have been implemented to solve the energy inefficiency problems. Some of the software approaches include load balancing, resource allocation, job scheduling, task consolidation, and VM virtualization and migration. To a certain degree, the advancement in hardware technologies such as solid-state drives, low-power CPUs, and energy-efficient computer monitors have also solved the energy inefficiency problems in cloud computing systems.

Large-scale data centers have become common due to the growth of cloud computing. Overall, there has been a significant increase in energy consumption within these facilities, making it an issue of concern. A rack of servers will draw a few Kilo Watt, however, large data centers draw several tens of MegaWatt from the grid. It is estimated that moderate to large data centers use power densities 100 times that used by a typical office building. As more people grow increasingly obsessed with cloud computing, its immense energy demands have become a concern for data centers and the cloud computing industry due to the ever-rising power bills. 


Survey on energy consumption in cloud computing. (2021, October 3). IJERT – International Journal of Engineering Research & Technology.

Global cloud computing market (2021 to 2028) - Size, share & trends analysis report - (2021, August 10).

Sampera, E. (n.d.). Is the cloud driving data center power consumption? Data Centers and Colocation Services | vXchnge.

Energy efficiency in cloud computing. (2019, April 3). GeeksforGeeks.

Cloud computing market size, share & industry growth [2028]. (n.d.). Fortune Business Insights™ | Global Market Research Report & Consulting.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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Dan Brdar

Dan Brdar is the President, CEO and a Director of Ideal Power. He has over 30 years of experience in the power systems and energy industries and has held a variety of leadership positions during his career. In addition to his role at Ideal Power, Dan previously served as President and CEO of FuelCell Energy Inc., a Nasdaq-listed company with a market cap of over $250 million.

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