The answer depends mostly on you. Are you into saving energy or boot-up time? How often do you leave your computer and for how long?
There are three main shut-down options available in Windows: Shut-Down, Sleep and Hibernate (names may vary depending on the Windows version). In Vista and Windows 7, there is also a fourth option; Hybrid Sleep.
Let’s explore the topic.
If your concern is to save energy, and you don’t mind the longer Boot Up time – then you should always use the “Shut Down” option. This will shut down every running service and application and wipe clean your RAM. This option saves the most energy as the computer is not using any power at all when in this state. There might be some power consumption from the main-board as it is still connected to your outlet, but this is significantly little.
Hibernate Vs Sleep
The difference between the two is power-consumption – one use less power than the other.
Sleep Feature = Pause
Sleep is a power-saving state which keeps enough voltage across your RAM to retain the memory for when you “wake up” your computer again. This mode use the most power of all the “Power-Off Modes” as the computer need to be able to keep your RAM alive. The Sleep Feature is recommended when you leave your computer for a short period (like going to lunch or step out for a few hours). Putting your computer into the sleep state is like pausing a DVD player—the computer immediately stops what it’s doing and is ready to start again when you want to resume working (usually within seconds).
The Hibernate function was intended primarily for laptop users (though available for Desktop Computers as well). This mode let you save much more power when not using your computer (as in saving battery). When you put the computer in Hibernate Mode, it stores the contents of your RAM (Services, clipboard etc.) to your hard-drive (hiberfile.sys) which on reboot is read back into the RAM (Read more about RAM) which takes about a minute to be completed, but on the upside you do save more energy.
Hybrid sleep is both Sleep and Hibernate, primarily intended for Desktop Computers. Hybrid Sleep keeps the RAM alive (as in Sleep Mode) and stores the Content of your RAM to your Hard-Drive (in case of a power failure). It also stores any open documents before putting your computer into a low-power state which allows for a quick Reboot later on. When hybrid sleep is turned on, putting your computer into sleep automatically puts your computer into hybrid sleep.
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