A case for virtualizing the electric utility in cloud data centers

Since energy-related costs make up an increasingly significant component of overall costs for data centers run by cloud providers, it is important that these costs be propagated to their tenants in ways that are fair and promote workload modulation that is aligned with overall cost-efficacy. We argue that there exists a big gap in how electric utilities charge data centers for their energy consumption (on the one hand) and the pricing interface exposed by cloud providers to their tenants (on the other). Whereas electric utilities employ complex features such as peak-based, time-varying, or tiered (load-dependent) pricing schemes, cloud providers charge tenants based on IT abstractions. This gap can create shortcomings such as unfairness in how tenants are charged and may also hinder overall cost-effective resource allocation. To overcome these shortcomings, we propose a novel idea of a virtual electric utility (VEU) that cloud providers should expose to individual tenants (in addition to their existing IT-based offerings). We discuss initial ideas underlying VEUs and challenges that must be addressed to turn them into a practical idea whose merits can be systematically explored.