Agencies Make Progress on Data Center Consolidation but Fall Short of Goals

Published: September 06, 2018


To date, agencies have not achieved data center closure, facility utilization, energy metering or virtualization targets on a government-wide basis.

Since 2010 the federal government has made a concerted effort to consolidate and optimize data centers in order to modernize IT infrastructures, achieve cost savings and shore up cybersecurity. OMB originally launched the Federal Data Center Consolidation Initiative (FDCCI) in FY 2010. In FY 2016 it was replaced by the Data Center Optimization Initiative (DCOI) which requires agencies to consolidate inefficient infrastructure, optimize existing facilities, improve security, achieve cost savings, and transition to more efficient infrastructure, such as cloud services and shared services. DCOI goals were originally to be met by the end of FY 2018.  However, the FITARA Enhancement Act of 2017 extended the deadlines to October 1, 2020.

DCOI set a goal of closing 25% of tiered data centers, those that have a separate physical space for IT infrastructure, possess an uninterruptible power supply, dedicated cooling system and a backup power generator. It also set a goal for closing 60% of non-tiered data centers. To date, agencies have only achieved 73% of their closure goal for non-tiered data centers, and 42% of their closure goal for tiered data centers. This equates to the closure of only 40% of all non-tiered data centers and only 10% of tiered data centers.

DCOI also set metrics and goals for server utilization, automated monitoring, facility utilization, energy metering, power usage effectiveness and virtualization. The table below shows the government-wide performance to data against these metrics:


FY 2017 Actual


Server Utilization and Automated Monitoring
(Tiered Data Centers)

No Data


Server Utilization and Automated Monitoring
(Non-Tiered Data Centers)

No Data


Facility Utilization



Energy Metering



Power Usage Effectiveness (PUE)






Source:  ITDashboard (Note:  There is currently no data on the ITDashboard regarding government-wide server utilization & automated monitoring.)

Total data center spending fell from $3.3B in FY 2017 to $2.9B in FY 2018 indicating that agencies are making progress and gaining efficiencies through their data center consolidation and optimization efforts. Most of the spending drop, efficiency gains and cost savings were driven by decreases in the labor category.

The government-wide average data center FITARA grade for the 24 agencies covered by DCOI was only a “C” for the May 2018 grading period, indicating the need for agencies to reinvigorate their efforts to consolidate and optimize data centers. The extension of data center optimization deadlines to the end of FY 2020 gives agencies much needed time to meet closure and optimization targets.

For more information on the status of federal data center consolidation and optimization, see Deltek’s new report, Federal Priorities Spotlight: Data Center Optimization.