Helsinki -- Later this week, the first servers in an experimental data center here that proponents say will be the world's most energy efficient will go into their racks -- and bigger plans are on the way.

When formally launched in August, the data center will generate the equivalent of a megawatt of energy for the city's district heating and cooling system, or enough heat to warm 500 homes, said Matti Roto, director of Academica Oy, which built the data center in conjunction with measurement company BaseN. Besides reducing the overall carbon impact of the data center, recycling the waste heat will lower operating costs.

The two companies also recently signed the papers for a deal that will see the construction of a second center at a nearby location that will generate ten times as much heat. Because it will generate around 10 megawatts of heat, the upcoming larger data center could qualify to earn subsidies under the country's feed-in tariff for heat. The lessons learned in these data centers will then be deployed to smart grid applications.

But for sheer scenic location, this first data center can't be beat. It is located in a cave beneath Uspenski Cathedral in downtown Helsinki that served as a bomb shelter during World War II. The entrance is a doorway carved into the rock base of the cathedral. Snaking aluminum and steel pipes filled with water climb along the wall. The circulating water is used to absorb the heat from the servers and then deliver it to the city's district heating network. The water-filled heat exchangers sit between the server racks, so the data center will not require mechanical air conditioning.

Seventy-five meters below the server and control rooms sit pipes "that you could drive a Mack truck through," said Roto. These pipes let the water circulate through the sea and get extra chilly before going to the server room. Academica will also place all of the fiber optics at these lower levels to avoid backhoe mishaps, which remain the primary cause of data center outages. (Still photos weren't allowed, but I was permitted to shoot some video. That will come later.)

Each server rack will provide 20 kilowatts of heating power, or to put it in more local terms, enough to power five saunas.

"So this is five, ten fifteen saunas," my guide says, moving down the row of now-empty server racks.

The companies would have liked to put more than 50 server racks in the center, but noise was a concern. Not only is the center located beneath one of Helsinki's major sites, but the Presidential Palace is practically next door.

District heating and cooling pretty much sounds like what it is: heat gets captured and then delivered to homes or water heaters. These systems work best in tight urban environments that tend to get really cold. Several northern European cities -- as well as St. Paul, Minnesota -- have district heating systems. But with heat exchangers, the heat can be converted to air conditioning, which is why a set of companies have launched plans to build an ocean-based air conditioner in Honolulu.

The data centers, though, will also serve a larger purpose for BaseN. The company has created a system that obtains data from sensors -- temperature sensors, CO2 sensors, etc. -- and then puts the data in a coherent interface for IT and resource managers. Rather than sell the software, BaseN offers it as a service. The company, for instance, monitors over 1,000 servers on behalf of cellular carriers. In one instance, a carrier was dropping 700 calls per second until the sensors pinpointed the problem.

The system is also the measuring tool used underneath the software from Hara, the hot U.S.-based energy management software, said BaseN CEO Pasi Hurri.

"Our sensors take measurements every two seconds," said Hurri. "We could measure four million households once per minute" using the current infrastructure.

Measurement will be key to how Academica's business plan takes shape. Most data centers in Finland charge a flat fee for power. By measuring minuscule changes in power, the company will instead be able to give customers more accurate bills that reflect their actual consumption. (In the first data center, the district power company that funded the construction, Hesingin Energia, will actually give Academica a break on rent for the cave in exchange for the heat, but in the larger data center the heat will ultimately rebound into discounts for customers.)

With smart meters set to blanket the country by 2013, time-of-use pricing will likely be incorporated. Thus, BaseN will try to take the experiences it has learned in the cave by that juncture and use them to develop and fine-tune smart grid applications.

"We could be the Google for everything that is measured," he added.

 But will the data center really be the world's most efficient? Rival Elisa in nearby Espoo earlier this year launched plans to build a data center that will produce enough heat for 2,000 homes. Which one will work best remains to be seen.