Wednesday, July 21, 2010

Google searches and purchases big stake in green energy

Lots of corporations talk a good green game, but Google, the internet information giant, is using its checkbook to make environmental news.

The Guardian reported today that :
"Google is officially in the green energy business. The search giant announced on Tuesday that its Google Energy subsidiary signed a 20-year power purchase agreement with NextEra Energy. Google will begin buying 114 megawatts of electricity from an Iowa wind farm on July 30.
Google, of course, cannot directly use the clean green energy generated by the wind farm; that power goes into the local grid. So Google Energy will sell the power on the regional spot market, where utilities and electricity retailers go to buy power when demand spikes and they have a shortfall. Google will use the revenue from spot market sales to buy renewable energy certificates (RECs) which will offset its greenhouse gas emissions.

Many companies buy RECs in an attempt to be carbon neutral, obtaining them from third-party brokers. But by purchasing RECs directly tied to the renewable energy it is also buying, Google is getting a bigger bang for its buck.

"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," Urs Hoelzle, Google's senior vice president for operations, wrote on a blog post Tuesday.

"The inability of renewable energy developers to obtain financing has been a significant inhibitor to the expansion of renewable energy," he added. "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 a statement on its site, Google also noted that its motivations for signing long-term renewable energy contracts are not entirely altruistic.

"Through the long term purchase of renewable energy at a predetermined price, we're partially protecting ourselves against future increases in power prices," the company stated. "This is a case where buying green makes business sense."

NextEra Energy Resources, the company that will supply Google with its wind power, is itself an alternative energy success story, having expanded its wind fleet from fewer than 500 megawatts a decade ago to more than 7,600 megawatts--the largest wind fleet in North America today.

NextEra hs more than 9,000 wind turbines in operation at 77 wind farms in 17 states and Canada. It boasts that the wind energy it generated in 2009 was he equivalent of removing some 2.4 million cars from the road.

Google's green energy purchase will come from NextEra's Story II Wind Energy Center in operation in Story and Hardin counties in Iowa. The company says in a news release that it has "nearly 700 wind turbines in operation in Iowa with a nameplate capacity of more than 1,000 megawatts that are capable of generating enough power to serve more than 250,000 average homes."

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