Total Cost of Ownership for Data Center Cooling Equipment: A Third Component in the Metric

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In a mature industry it is easy to assume that there is not much differentiation between the top suppliers.  The HVAC industry is one of the market sectors in the global economy that is fairly mature and has a lot of competitors.  How are owners, engineers, and contractors to differentiate between the various suppliers?   Often times even custom solutions are treated from purchasing departments as though they are commodities and as a result any manufacturer ought to be able to produce a similar end product.  As a result the decision is sometimes made on price alone.  Obviously, the capital expense of the equipment is important, but the total cost of ownership also needs to be considered.

When it comes to data center cooling equipment, the total cost of ownership usually involves assessing the first cost as well as the cooling system’s operating costs. Both capital expenditure (CAPEX) and operational expenditure (OPEX) are essential in determining TCO. However, these two factors alone are insufficient to create a comprehensive TCO metric. There’s a third factor (among others) that should be included: business continuity. Business continuity would consider operational efficiency not just for the equipment but also for the staff responsible for overseeing it. This is where a company’s reputation for solution quality must carry additional weight in the TCO metric. One company may offer a much lower price than its competitors, but at what cost to business continuity? If there are any issues with equipment operation, what kind of response is the manufacturer known for? This, along with the following questions, should be considered by data center owners when determining true TCO:

  1. What is the manufacturer’s reputation for providing quality equipment?
  2. How easy is it to work with the manufacturer on Day 2? In other words, what happens after the equipment has been paid for and installed? Is the manufacturer difficult to reach? Are they readily available to provide knowledge and help based on years of experience?
  3. Will my in-house project management staff’s lives be made easier and more efficient? Or will they be stressed and less effective due to a lack of helpfulness from the equipment supplier?
  4. What will our company’s relationship with the manufacturer be like going forward? Will the conversation be filtered through third-party equipment reps? Or will we have direct access to the manufacturer?
  5. Does the data center cooling equipment manufacturer have a reputation for showing up on time, doing what they say, finishing what they start, and quickly making things right if something goes wrong?

When questions like the above are answered, data center owners, contractors, and consulting engineers can better understand the actual cost of ownership.

To learn more about using evaporative cooling technology to cool Hyperscale data centers, visit United Metal Products or contact