Validus DC Systems announced Tuesday that it had received $10 million in a first round of venture funding led by Oak Hill Venture Partners.
The Brookfield, Conn.-based company claims its technology, developed by the former head of MIT's Plasma Science and Fusion Center, Marcel Gaudreau, improves energy efficiency in data centers by as much as 40 percent.
The technology allows data centers to use direct current, instead of the usual alternating current. While an AC system generally requires five or six inversions of power from DC, Validus DC Systems says its system requires only two inversions, bringing expenses down as a result of reduced energy and cooling costs.
"Today we can be much more effective and much more efficient than any AC transformer out there today," Validus DC Systems CEO Rudy Kraus said.
Energy has quickly become one of the top headaches for data-center managers across the globe. As more information gets stored electronically and as higher-resolution photos, games and videos take up more space, data centers are faced with skyrocketing electricity bills and -- in some cases -- energy caps that force companies to pay millions of dollars to build new data centers well ahead of schedule.
According to a study by the U.S. Environmental Protection Agency, the IT industry consumed about 61 billion kilowatt-hours in 2006, which constituted 1.5 percent of the total electricity used in the United States and cost $4.5 billion.
What's more, the agency predicts that power consumption in the industry will double by 2012, and that the country would need to add the equivalent of 10 new power plants to support itself (see Data Centers Could Hit 'Resource Crisis').
And in September, ONStor, a Campbell, Calif.-based company that develops storage solutions, polled more than 350 IT companies to find that 63 percent of the companies' data centers had run out of space, power or cooling capacity without warning.
"Data-center efficiency is no longer just an IT issue; it's one of the most pressing concerns across all levels of business management," Kraus said in a written statement.
Data centers' pain has turned into opportunity for technologies, such as Validus', that attempt to help them do more with less energy.
While alternating current -- the type of electricity that is used by most household appliances -- allows for the transport of electricity over greater distances, direct current is more efficient, advocates say.
Susan Eustis, the president of WinterGreen Research, said that DC power makes the most sense to solve future data center problems, as the cost of grid electricity and oil continue to rise.
"There's a lot of cost associated with conversion to AC," she said. "That's why we say, 'Why bother with the conversion?' The DC is the only thing that makes sense."
Switching to DC power would require infrastructure changes and a potentially large expense to adapt the current AC system. The EPA report suggested that existing technologies and strategies could reduce typical server energy use by an estimated 25 percent, without any implementation of new technology.
But Kraus plans to target new data centers that could support DC power from the time they're built. After all, new data centers are continuously springing up, making a large potential market for Validus.
"The opportunity is in becoming involved with the data center when it's being designed and put in," he said. "It's extremely feasible to do."