Outsourcing IT and data center functions to third party providers can deliver energy savings of up to 40 percent and help reduce firms' exposure to green legislation, according to a new whitepaper from IT analyst firm IDC.

The study, which was commissioned by managed IT services provider Rackspace, argues that specialist IT outsourcing providers can exploit economies of scale by sharing the same data center infrastructure across large numbers of customers, allowing them to reduce overall energy use.

James Eibisch, research director at IDC's European telecoms and networking group said that outsourcing IT work to third parties also reduces the risk of increased compliance pressures for IT directors.

"Although today the EU would like the IT industry to regulate itself, this won't be the case forever," he predicted. "Today, legislation is concentrated on areas such as materials and recycling, but discussions are going on within the EU and NGOs to extend environmental regulation to IT and communications, and companies must consider the future implications of this for their business."

Fabio Torlini, marketing director at Rackspace, said firms could sidestep many of these imminent regulations by handing IT functions to specialist providers.

He also argued that IT outsourcing firms also had greater freedom to invest in the latest energy efficient IT equipment and renewable energy technologies. "Installing these new technologies is a massive investment, but when as a service provider you split that investment out per customer it becomes manageable," he explained. "Individual IT departments don't have that luxury and find it harder to justify these investments."

He added that Rackspace had recently authorized just such an investment, and was preparing to unveil a new data center facility next year that will be powered using a biomass-fueled power plant and will incorporate the latest energy efficient server and cooling technologies.