Greening Multi-Tenant Data Center Demand Response

TL;DR

This paper introduces ColoEDR, a pricing mechanism for multi-tenant data centers to efficiently reduce energy during emergencies, minimizing environmental impact and backup generator use.

Contribution

It presents a novel supply function bidding-based pricing mechanism for demand response in colocation data centers with provable near-optimal efficiency guarantees.

Findings

Reduces reliance on diesel generators during emergencies.

Provides payments to tenants for load reductions.

Validated through trace-based simulations showing environmental and economic benefits.

Abstract

Data centers have emerged as promising resources for demand response, particularly for emergency demand response (EDR), which saves the power grid from incurring blackouts during emergency situations. However, currently, data centers typically participate in EDR by turning on backup (diesel) generators, which is both expensive and environmentally unfriendly. In this paper, we focus on "greening" demand response in multi-tenant data centers, i.e., colocation data centers, by designing a pricing mechanism through which the data center operator can efficiently extract load reductions from tenants during emergency periods to fulfill energy reduction requirement for EDR. In particular, we propose a pricing mechanism for both mandatory and voluntary EDR programs, ColoEDR, that is based on parameterized supply function bidding and provides provably near-optimal efficiency guarantees, both when tenants are price-taking and when they are price-anticipating. In addition to analytic results, we extend the literature on supply function mechanism design, and evaluate ColoEDR using trace-based simulation studies. These validate the efficiency analysis and conclude that the pricing mechanism is both beneficial to the environment and to the data center operator (by decreasing the need for backup diesel generation), while also aiding tenants (by providing payments for load reductions).