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It is anticipated that in the near future disk storage systems will surpass application servers and will become the primary consumer of power in the data centers. Shutting down of inactive disks is one of the more widespread solutions to save power consumption of disk systems. This solution involves spinning down or completely shutting off disks that exhibit long periods of inactivity and placing them in standby mode. A file request from a disk in standby mode will incur an I/O cost penalty as it takes time to spin up the disk before it can serve the file. In this paper, we address the problem of designing and implementing file allocation strategies on disk storage that save energy while meeting performance requirements of file retrievals. We present an algorithm for solving this problem with guaranteed bounds from the optimal solution. Our algorithm runs in O(n log n) time where n is the number of files allocated. Detailed simulation results and experiments with real life workloads are also presented.