There are 50 million computer servers in the world today.  And a recent report by BusinessWeek says that, of the 8 million new servers added each year, 50% are bound for data centers. That’s 4 million additional servers per year that will be used to store and deliver computing programs and services over the Internet, or “cloud”.

IT Companies are quickly developing cloud-based offerings and building data centers to house servers that store all of the data the cloud delivers - email, photos, videos, entertainment, news, and computing programs. As more and more electricity is required to operate these data centers and run the servers, IT companies are looking for ways to keep their power costs low.

Unfortunately, a strategy that is still being employed by many IT companies to keep the overhead down is to locate data centers in places where “cheap” coal-fired electricity is available. In January, for example, Facebook commissioned a new data center in Oregon and entered a power service agreement with a utility called PacificCorp, which gets most of its electricity from coal-fired power stations. Just this week, eBay unveiled its new flagship data center, located in South Jordan, Utah, a state that derives 81% of its electricity from coal.

The Topaz data center, as the new hosting facility for eBay’s Marketplace and Paypal.com is called, is a US$287 million facility with top-of-the-line energy efficiency features, which help to make Topaz 50% less expensive for eBay to operate and 30% more efficient than any of the other data centers it uses. And eBay is very proud of its energy and cost savings accomplishment (as evidenced by the break dancers that performed at the launch party). But, is a diet on which you eat 30% less per meal, but eat MANY more meals than you previously did, AND exclusively live on Twinkies, ultimately going to save you from an untimely and serious health problem?

That is what’s at issue with eBay’s data center, and it’s what will be at issue for many other IT companies as they rapidly expand their cloud-computing operations to rely on fossil fuel based electricity, thus building a "brown" cloud. The fuel source matters if you really want to be green because energy efficiency will not save the planet from the worst predicted impacts of climate change as long as data centers continue to multiply and increase demand for coal and other forms of dirty energy, much like a reduced diet of only Twinkies will likely not help you avoid weight gain or heart problems. A combination of efficiency and renewable power is required.

Additionally, eBay’s math may be missing a very important calculation: risk. At the Uptime Institute Symposium last week, speakers discussed the economic impacts that a “carbon tax” or carbon regulation could have on data center operators. Mike Manos of Nokia, pointing to the U.K.’s existing carbon legislation, indicated that the IT sector is ill-equipped to deal with inevitable penalties that will be associated with a heavy reliance on coal when U.S. climate legislation passes.

“Carbon emissions differ for a facility in Washington State and a facility in West Virginia,” said Manos. “Where your data centers are located today is an important criteria.”

In fact, Washington State, home to Microsoft’s new 470,000 square foot data center, has a power mix dominated by 65% hydroelectric, and is one of the top states in renewable energy sourcing. So, for comparison’s sake, Washington’s grid relies on 17% coal, versus Utah’s 81%. If eBay truly wants its new data center to be “solid, stable, and secure” as Dean Nelson, Director of Global Data Center Strategy, Architecture & Operations, has said, why didn’t the company base its geographical choice on a more complete assessment of costs and risks?

Some IT companies are starting to get it.  An Ericsson white paper, “Minimizing Carbon Intensity in Telecom Networks Using TCO (Total Cost of Operation) Techniques,” demonstrates the company’s methodology (which gets it second-place ranking on the Cool IT Leaderboard) for understanding both the cost and environmental impacts of its operations, recognizing that the absolute amount of energy consumed by telecom networks is growing, along with carbon emissions, which must be managed. The same is true for cloud computing and the infrastructure that runs it.

So, instead of behaving like a carbon problem doesn’t exist, Facebook, eBay and other IT companies would be better off in the long-run if they changed their data center siting policies to demand coal-free sources of electricity, and put all new data centers on a strict low-carbon renewable energy diet. That is how to build a cloud that's green.