Renewable Energy Investments-Essential for Tech Firms

Large tech companies are making renewable energy a key focus as their energy needs escalate.
Published: Mon 17 Feb 2014

The Ivanpah Solar Electric Generating System, covering about five square miles of federal land near the California-Nevada border, has finally opened.

The US$2.2 billion complex of three generating units, owned by NRG Energy, Google and BrightSource Energy, is able to generate almost 400MW-enough to power 140,000 homes.

The site is ideal for generating solar power as it enjoys virtually uninterrupted sunshine most of the year and it is near existing transmission lines. The site uses technology known as solar-thermal. The 350,000 computer-controlled mirrors reflect sunlight to boilers located on top of 459-foot towers. The sun's power is used to heat water in the boilers' tubes and generate steam which drives the turbines to create electricity.

While solar power accounts for less than one percent of the nation's power output, thousands of projects from large, utility-scale plants to small production sites are under construction or being planned.

This is largely due to the US government’s support of solar energy development.

Google’s commitment to clean power

This latest clean power move by Google again highlights the firm’s commitment to clean power infrastructure investment. It also shows that there are many ways in which Internet companies can develop the “clean” grid.

In 2011, Google announced that it would invest US$168 million in the Ivanpah Solar Electric Generating System project. The search engine firm has already invested over US$1 billion into renewable projects worldwide. These include wind farms in the Mojave Desert, North Dakota and Arlington, a German solar facility and a transmission line for wind farms off the mid-Atlantic Coast. And, it doesn’t look as if the search engine company is going to stop.

The firm has signed contracts to buy 570MW of renewable electricity for its data centers. The firm gets about 20% of its power from solar facilities, but the company has committed to achieving 100% renewable energy.

Google is making these investments partly because they can make money off of them, and partly because these projects can be areas that could feed electricity to Google data centers. Google can also get renewable energy credits from these investments. The IRS’s Investment Tax Credit offers companies a 30% tax credit for renewable power investments.

By pumping money into renewable energy resources, Google also hopes to drive up the economies of scale in order to eventually push prices below that of fossil fuel energy resources.

It’s not only solar that Google is interested in. In addition to locations in California and Arizona, Google has data centres in Oklahoma and Iowa so they can plug into wind farms.

In our article, Google Sees Green, we discuss the motives behind Google’s renewable energy strategy.

Tech companies are going green

Along with Microsoft and Apple, Google is among a fleet of technology companies that are moving to tap solar, wind and hydroelectric power sources.

The availability of renewable energy resources is now a major consideration when it comes to the location of their corporate offices and data centers. The move is designed to save them millions of dollars in long-term energy costs.

Says Josh Henretig, director of environmental sustainability at Microsoft, “We believe energy is the future of our business. Microsoft has increasingly transitioned from a software company to a services and devices company. The services are largely based on our need for cloud [infrastructures] and, in turn, the energy that those clouds and data centers use. So we are absolutely focused on the role energy plays in our organization longer term."