The company is calling the Power 6 its greenest chip as it uses the same amount of energy as the Power 5, but has twice the performance.
The Power 6 is twice as powerful as the entire Deep Blue supercomputing system that beat chess champion Gary Kasparov 10 years ago, and IBM claims that it is 2.3 times faster than its nearest competitor.
"We should not just consider the performance of chips, but the environment," said IBM systems and technology group senior vice president, Bill Zeitler.
"The crisis in data centre management is not about performance; it is about energy and cooling. The amount spent on hardware itself is tiny compared to power and cooling costs. It is not possible for the industry to continue in this way."
IBM launched Project Big Green two weeks ago, a portfolio of products to address green issues in the market.
The new chip is an important part of the portfolio, which includes virtualisation, low-power processors and smarter runtime use. IBM has committed to spending over US$1 billion (A$1.2 billion) researching green issues.
The Power 6 uses a number of technical tricks to cut power consumption and heat build up.
These include shifting low-power processor functions into separate sections of the chip, rejigging others so that they can be performed at lower power levels and building parallel processing functions onto the silicon.
"Every boardroom I go into now the issue is global warming," said IBM UK general manager, Larry Hirst.
"It is all about how can I reduce my carbon footprint, what can I do to reach zero emissions."
IBM has built the Power 6 into a new server, the p570, a 4-16 processor system that will be available in two weeks and has been built as IBM's fastest server, with virtualisation and high bandwidth capabilities built in.
The p570 has a 300 Gbps connection, 30 times that of an HP Itanium. IBM estimates that this bandwidth could allow it to download the entire 20TB iTunes catalogue in 66 seconds.
The new system has also been designed to support much greater use of virtualisation, since IBM is touting it as a replacement for multiple low-end servers.
It uses a new technique calls Live Partition Mobility which allows IT managers to move virtual machines between servers with no downtime.
"This partition mobility is vital because it will be the base stone of everything to come," said the chip's creator, IBM fellow, Brad McCreedy.
"It will allow you to migrate all functions around systems, be they databases, applications or workloads, around the servers."
However, the new chip could cause software companies a headache. IBM estimates that software licensing fees charged on a per-chip basis could be cut by 90 per cent in some places because of the speed of the Power 6.
IBM will cut the price of its Power 5 systems by 20-25 per cent in the next two weeks to support the new chip.
IBM unveils world's fastest processor
By Iain Thomson on May 22, 2007 10:09AM
IBM has unveiled what it claims is the fastest processor in the world - the Power 6 runs at 4.7GHz, and has an 8MB L2 cache and 790 million transistors built on a 65nm scale.
Got a news tip for our journalists? Share it with us anonymously here.