The ACPI functions in Windows XP can reduce the amount of energy that your computer consumes, but they don't drop consumption all the way to zero. Even if the computer is off, it's still consuming a small amount of electric power. Add the amounts consumed by external peripheral devices such as the monitor, printer, and modem, and you're probably using enough energy to make a small but noticeable difference on your monthly electric power bill.
Therefore, it's worth the time and trouble to pay some attention to the way your computer (and your TV and other electronic equipment) use power, even when they're not running. For some devices, the convenience of instant-on operation might be worth the pennies it costs to provide standby power, but in other cases, it's just wasted money and energy. For example, there's really no good reason for your monitor, printer, or Internet modem to continue drawing power when the computer is off.
The easiest way to attack this problem is to plug your computer equipment into a power strip or an uninterruptible power supply with a switch that cuts off power to all of its outlets. When you're ready to use the system, turn on the main switch power first; when you're done for the day, shut down the computer normally, and then turn off the master power switch.
But that's not always the most efficient way to operate your equipment. In many cases, the computer and other devices consume two or three times as much power in an initial surge immediately after you turn them on as they use during normal operation. So that surge might use up more power than you have saved by cutting off standby power. It's probably not cost-effective to turn off the master power switch if you expect to use the equipment again within a few hours.