Energy consumption has become a critical issue for data centers, triggered by the rise in energy costs, volatility in the supply and demand of energy and the wide spread proliferation of power-hungry information technology (IT) equipment. Since nearly half the energy consumed in a data center (DC) goes towards cooling, much of the efforts in minimizing energy consumption in DCs have focused on improving the efficiency of cooling strategies by optimally provisioning the cooling power to match the heat dissipation in the entire DC. However, at a more granular level within the DC, the large range of heat densities of today's IT equipment makes this task of provisioning cooling power at the level of individual computer room air conditioning (CRAC) units much more challenging. In this work, we employ utility functions to present a principled and flexible method for determining the optimal settings of CRACs for joint management of power and temperature objectives at a more granular level within a DC. Such provisioning of cooling power to match the heat generated at a local level requires the knowledge of thermal zones - the region of DC space cooled by a specific CRAC. We show how thermal zones can be constructed for arbitrary settings of CRACs using the potential flow theory. As a case study, we apply our methodology in a 10, 000 sq. ft commercial DC using actual measured conditions and evaluate the usefulness of the method by quantifying possible energy savings in this DC. © 2011 by ASME.