IBM, the world’s largest IT-services group, is to spend $1 billion a year on doubling the energy efficiency of its internet data centres.

The company, which runs more than eight million square feet of data centre space worldwide, is aiming to double the computing capacity of its own “server farms” — the plants that house the machines used to host websites and store corporate data — by 2010.

The initiative, dubbed Project Big Green (IBM is known as Big Blue), aims to save up to 5 billion kilowatt energy hours a year — roughly enough to heat 370,000 homes for one winter.

The scheme is expected to save $500 million (£250m) in energy costs over the next three years.

IBM will also offer a service where clients can maximise the efficiency of their own server farms.

The move comes amid a creeping realisation that the web and other technologies behind the idea of “the paperless office” are not as green as they may appear.

A latest-generation, fully-laden blade server emits roughly as much as two domestic ovens on full blast with the doors open.

Much of the electricity used in server farms is used to cool the machines.

Last year, servers based in the US used as much electricity as the nation’s television sets.

Global electricity consumption by servers and related equipment is estimated to have doubled to $7.3 billion from 2000 to 2005.

Companies such as Google, which has quietly rolled out a massive network of advanced data centres, have built new plants on the banks of large rivers to harness hydroelectric power.

More widely, companies have been keen to burnish their green credentials as the issue moves up the list of concerns of consumers.

This week Citigroup committed $50 billion to environmental projects over the next decade.

News Corporation, parent company of Times Online, pledged yesterday to become carbon neutral by 2010.

IBM is aiming to make data centres greener by using more "virtualisation" technologies, which allow one computer to handle the operations of multiple machines.

The company will also deploy more provisioning software, which maximises the time servers spend on power-saving mode, and plans to use new liquid-cooling systems, which capture power in off-peak times and store it for peak use.

The $1 billion is being reallocated from other purposes and is not an increase in the company's investment or capital expenditure plans.

Energy accounts for about half the cost of running computer hardware and is expected to rise to more than 70 per cent in the next four years.

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