Google's Clean Energy Arm Open for Business

David Bois - Tonic

The Internet company's green energy subsidiary puts a gust of wind in renewable power's sails by inking a 20-year deal to purchase and resell wind energy generated in Iowa.

iowa_wind_farm.jpgSeveral signs have appeared over the past year or so that signal just how seriously search engine giant Google is taking clean, renewable energy. Among those that we have covered here are the company's investments in clean energy innovations such as those of Bloom Energy, its onsite solar facility and their use of a fleet of electric vehicles on their Mountain View, Calif. campus. It's not exactly the stuff of refining their algorithms to produce a better set of search results.

And Google upped the renewable energy ante earlier this year with the formation of a subsidiary company, Google Energy, for which an application was submitted to the Federal Energy Regulatory Commission to allow the new corporate entity to purchase and sell clean power on the open market. As reported in January by, the move might appear on the surface to represent wandering from their core business, but in fact is intended to support a core strategic goal to achieve carbon neutrality.

As company representative Niki Fenwick explained at the time:

"Right now, we can't buy affordable, utility-scale, renewable energy in our markets. We want to buy the highest quality, most affordable renewable energy wherever we can and use the green credits."

This week brings news that Google Energy's proverbial shingle is now hanging outside their doors, now officially open for business. As reported by The Guardian, Google Energy has inked its first deal, and the 20-year duration of the contract that they have signed should serve to underscore the seriousness of Google's intentions and interests.

Beginning July 30, Google will kick off its purchase of 114 megawatts (MW) of energy produced on an Iowa wind farm through the agreement recently reached with NextEra Energy.

As The Guardian explains, Google is not purchasing the energy for its own use, but rather to resell it through the regional grid on the local spot markets. The money generated from the resale of the energy will then go to the purchase of renewable energy certificates. These certificates, themselves a tradable commodity, are energy credits that provide certification of each megawatt-hour of energy produced from renewable sources. Rather than resell these credits however, Google reportedly plans to use them to offset their ongoing use of energy from non-renewable sources in their march toward carbon neutrality.

The Guardian points out that by virtue of the size and reach of NextEra Energy's latest customer, the boost that the Google deal offers should provide the investment capital that will bolster the expansion of the region's renewable energy generation capacity. As Google vice president of operations Urs Hoezle wrote on the company's blog:

"By contracting to purchase so much energy for so long, we're giving the developer of the wind farm financial certainty to build additional clean energy projects. The inability of renewable energy developers to obtain financing has been a significant inhibitor to the expansion of renewable energy. We've been excited about this deal because taking 114 megawatts of wind power off the market for so long means producers have the incentive and means to build more renewable energy capacity for other customers."

In addition, The Guardian points out that the 2-decade commitment that the deal represents should offer Google some protection against any price spikes that could conceivably crop up through potential power shortages.

This article was originally posted on the Tonic website.

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AMAZING STUFF. Really a sign of Energy enlightenment when NET Companies start doing GREAT things like investing in what counts e.g. CLEAN -cost efficient electricity production!
Michael -

Written in February 2011

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  • Posted on July 24, 2010. Listed in:

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