Google is working towards 100% renewable energy to power its company.
In 2010, 25% of the company’s power was supplied by renewable resources. Google has already invested over US$1-m in clean energy projects. Projects include the following:
- Spinning Spur Wind Farm: investing in West Texas wind
- Rippey Wind Farm: financing wind power in Iowa
- Recurrent Energy: large scale photovoltaic (PV) projects in California
- Clean Power Finance: financing for rooftop solar
- SolarCity: solar for thousands of residential rooftops
- BrightSource: concentrated solar power at scale
- Atlantic Wind Connection: a superhighway for clean energy transmission
- Alta Wind Energy Center: harnessing winds of the Mojave
- Shepherd’s Flat: one of the world’s largest wind farms
- Peace Garden Wind Farms: opening up more financing for wind
- Photovoltaics in Germany: investing in clean energy overseas
However, while it may seem that Google has chosen this path to appear “environmentally-correct”, we believe that the real driver behind this investment is just good and simple business sense.
Google has an obsession with web-speed. A good example of this is Google’s predictive subject and word search engine which makes searching the web that much faster. In fact, not many people know that Google is the world’s third largest server manufacturer. The company builds its own hardware in its quest to optimize web search speed. All this compute power, needed for its core business, as well as the storage required for Google Apps, customers call for larger data centers. Google is investing billions of dollars in these data centers-about US$2.5-bn annually.
There’s no surprise, therefore, that this type of innovation and growth requires additional power-and a lot of it.
Every time a person runs a Google search, watches a YouTube video or sends a message through Gmail, the data centers’ computers use electricity. These data centers around the world continuously draw almost 260 million watts-about a quarter of a nuclear plant’s output. Some of these data center complexes consume enough energy to power a small city.
Although Google does a great job ensuring that it is energy efficient, the company is still keen on reducing its power bill. Their answer to this? Invest in or buy renewables pioneers.
Google has become a key investor in renewable technology, but it’s also become an innovator of how to use that technology to power its own business. Google recently entered into two 20-year power purchase agreements for over 100MW from a wind energy developer in Iowa and Oklahoma, states where the company operates large data centers. Google has also launched Google Energy, a subsidiary that allows it to act like a utility that can buy and sell electricity onto the grid. Becoming a utility is smart business as their data centers draw huge amounts of reliable power. The management of power costs is a major factor in this business. Becoming a utility allows Google to exercise more control over their energy costs long term.
Wind power in particular has been a major source of investment for Google. We can expect to see Google put to work its incredible resources to improve wind generation. The company’s interest in wind generation will be an interesting one to watch as generation can be located right at the source of consumption and most Google data centers are not situated close to other renewable sources other than solar. Due to the intermittent nature of renewable sources, the next obvious step for Google will probably be the investment in renewable energy storage solutions such as super capacitors.
At Engerati, regardless of whether Google’s investment decision is based on environment or business opportunities, we believe that this investment is a good thing all-round. The reasoning behind this is that when Google’s business objectives are directly aligned with investments, real innovation takes place and markets are shaken up. One only needs to look at what Google analytics did for that market segment, casualties like Webtrends aside.
While all this may be dressed up as sustainable and green credentials, make no mistake this is more about self-interest and good business sense by Google. This will ensure that the internet giant continues to invest in this sector.