Intelligent Energy

Google's clean energy investments nearing $1 billion

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Google has invested nearly US$1 billion into renewable energy. Its latest commitment to finance a wind power project in California is intended to attract further investment into the sector.

Google has invested almost US$700M into clean renewable power this year alone. Image Credit: Google.

Google is approaching US$1 billion invested in renewable energy following today’s announcement that it is deepening its commitment to a wind power project in California. The investment is part of a strategy to make clean electricity more widespread.

Today, Google announced that it was kicking in an additional $102 million of funds for the Alta Wind Energy Center (AWEC) in Tehachapi, Calif. The company invested $55M into the AWEC project in May.

Google’s renewable energy investments now total $780 million. It allocated $280M toward residential solar power earlier this month, spent $100 million for a majority stake in the 845-megawatts Shepherds Flat wind power project in Oregon in April, and  made a $168 million investment in BrightSource Energy’s 2,600 megawatts Ivanpah Solar Electric Generating System.

Rick Needham, director of green business operations at Google, wrote that the projects provide “attractive financial returns” and have advanced the deployment of over 1.7 gigawatts of clean energy into the grid.

The availability of renewable energy is important to Google’s business: energy is the biggest roadblock to data center build outs. Google must increase its compute capacity to grow and offer more advanced services, and that takes lots of electricity.

Competitors including Amazon and Microsoft face a similar challenge. Amazon’s data center engineering guru James Hamilton is doing some great things to maximize energy usage and lower costs, but Amazon has not invested in clean energy projects as aggressively as Google and Microsoft have.

My day job is at a software company (full disclosure: ScaleOut Software) that develops services that can run in the cloud to analyze massive volumes of data in real-time. Data analytics is an example of the type of service that cloud providers can host, which would otherwise require customers to build out permanent, massive data centers on-premises.

Cloud computing is arguably a "greener" way to maximize shared IT resources, but the energy sources that cloud providers depend upon are oftentimes "dirty." They require affordable energy to operate, but also have a PR problem to deal with - becoming a big polluter.

Google’s energy strategy is to invest in renewable energy projects with the intention of making similar projects more alluring to other investors. It is essentially acting as a Johnny Appleseed for clean energy.

The company is advocating a financial structure called leveraged lease to encourage investment in wind energy. Terra-Gen Power (the lessor) will manage AWEC’s date-to-day operations, but Citibank and Google put up the majority of funds.

“We are particularly excited about AWEC because it will be one of the largest wind energy centers in the world, with over 1 GW of production scheduled to be on line by the end of the year and 1,550 MW when fully completed,” Needham stated.

“It’ll deliver that energy using the Tehachapi Renewable Transmission Project (TRTP), one of the first and largest transmission projects developed specifically for clean energy.”

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David Worthington

Contributing Editor

David Worthington has written for BetaNews, eWeek, PC World, Technologizer and ZDNet. Formerly, he was a senior editor at SD Times. He holds a business degree from Temple University. He is based in New York. Follow him on Twitter. Disclosure