IBM on Thursday unveiled a $1 billion-a-year service initiative aimed at building and redesigning data centers that consume less energy.

At a press conference in New York City, the company debuted Project Big Green, which will call on 850 Global Technology Services employees to redesign IBM’s own data centers and those of its customers.

"Large companies are facing a large crisis around energy,” says Mike Daniels, senior vice president of IBM Global Technology Services. “This issue is surfacing in a number of different ways, whether it’s the capital required to build new data centers because people are out of capacity, or where people are out of power or trying to manage that power. We think this is an issue where we can provide leadership for the industry and for our clients."

IBM claims that the savings for customers are great in going green -- by using IBM technologies such as their blade servers instead of other vendor’s technologies, a customer with a 25,000-square-foot data center should be able to save as much as 42% on energy consumption.

That savings is huge, says IDC, which estimates that for every dollar spent on computer hardware, another 50 cents is spent on energy. This amount, IDC says, is expected to increase to more than 71 cents by 2011.

The Big Green initiative also will net IBM lots of dollars. The company has put the "$1 billion" stamp on two past initiatives: Its $500 million investment in e-commerce in 2000 netted the company $1 billion in Web-hosting services contracts a year later. Also in 2000, IBM announced it had already spent $1 billion on promoting Linux and that in 2001 it would spend an equivalent amount.

Pacific Gas and Electric Company (PG&E) is one of the customers that says it already has benefited from IBM’s green initiative. The company used IBM diagnostic technology at three data centers to measure and identify hot spots, air leakage and other inefficiencies across 40,000 square feet of data-center space. Had PG&E surveyed this space manually, it would have taken several weeks instead of a few days.

“"The real key to us is on energy efficiency and reducing the demand for energy both for us and our customers," says Brad Whitcomb, PC&E vice president of customer products and services.