Ramon Nuez: Google is Going into the Electricity Business
Google is one of the most successful company’s in US history. It began as a research project at Stanford University back in 1996. Larry Page who was later joined by Sergey Brin postulated that Internet search could be done better. Not only did Larry and Sergey succeed in making search better – they turned a thesis into a $22 billion company. Over its’ fourteen year history Google has entered a variety markets with products like Ad Words, Google News, Google Search Appliance and the Nexus One. Google, now, is getting into the electricity business.
In a press release on November 27, 2007 Google announced a strategic initiative to develop renewable energy. The initiative is called RE<C.
There has been tremendous work already on renewable energy. Technologies have been developed that can mature into industries capable of providing electricity cheaper than coal. Solar thermal technology, for example, provides a very plausible path to providing renewable energy cheaper than coal. We are also very interested in further developing other technologies that have potential to be cost-competitive and green. We are aware of several promising technologies, and believe there are many more out there.
This past December Google submitted an application asking the Federal Energy Regulatory Commission (FERC) for the authority to sell electricity at “market-based rate authority.” Google makes the argument that it wants to manage the enormous energy requirements of its’ data centers. That is a valid argument since it’ s rumored that Google has at least 12 data centers in the United States. I say “at least 12″ since Google keeps this information secrete.
The Federal Energy Regulatory Commission is the agency with jurisdiction over interstate electricity sales, wholesale electric rates, hydroelectric licensing, natural gas pricing and oil pipeline rates. They explain that it is not uncommon for a company the size of Google to make such a request. The FERC currently has granted 1500 companies the authority to sell electricity; at market-based rates. Google has requested that the FERC approve the application by February 23, 2010.
Now you won’t be getting your next electrical bill from Google. That will still come from your local utilities company. The authority Google is requesting is the ability to sell electricity wholesale. My educated guess is that Google will leverage this authority through RE<C and Google.org, to work with varies companies, universities and R&D laboratories – to produce various unsubsidized types of renewable energy.
The United States Department of Energy (DOE) explains that IT is a critical component to the information economy. IT over the past decade has grown at an exponential rate. To support this growth companies must build massive data centers; which consume great quantities of this country’s electricity.
Information technology and telecommunications facilities account for approximately 120 billion kilowatt hours of electricity annually – or 3 percent of all U.S. electricity use. Moreover, rapid growth in the U.S. data center industry is projected to require two new large power plants per year just to keep pace with the expected demand growth. Without gains in efficiency, the industry would face increasing costs and greenhouse gas emissions, along with challenges to the reliability of the electricity service.
-United States Department of Energy
From what I understand Larry Page is truly concerned about Google’s carbon footprint. I had a conversation with a Google representative a few months ago and she explained that Google is the 4th largest computer manufacturer in the world. Combine that with its’ 12 data centers and Google stands to produce a massive amount of green house emissions; not to mention the monster electricity bill. It’s no wonder Larry wants to find renewable energy sources.
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