Due to the ongoing Paris climate conference, we’re in a season of major clean energy announcements — from Bill Gates’ coalition of billionaires pledged to support breakthrough technologies to stunning plans for Africa to install 300 gigawatts of renewable capacity by 2030.
And now Google, the company that has in many ways been the leader of corporate clean energy purchasing, has announced its biggest new move yet.
With the ultimate goal of powering everything that it does with clean energy, Google has been signing global “power purchase agreements” to buy clean energy, usually wind, in long term contracts. This electricity can then be used, either directly or indirectly, to power its data centers, which are major consumers of power. Thus, your Google searches, e-mails, and more are increasingly powered by wind and solar.
Up until now, Google had purchased around 1.2 gigawatts of clean energy capacity around the world — a gigawatt is a billion watts. Indeed, prior to this announcement, the company says it had “already committed to purchase more renewable energy than any other company.” Now, Google is adding 842 megawatts (.842 gigawatts) of additional capacity, across a variety of projects, to bring its total to an impressive 2 gigawatts.
“These are global deals on 3 continents, 6 deals in total, in the U.S. and Chile and Sweden,” said Michael Terrell, who leads energy policy and market strategy for Google’s global infrastructure team. The company recently pledged to triple its purchases of renewable energy by 2025, and the new announcement already moves it a considerable way in that direction.
The new investments include purchases in both wind and solar. In the U.S., Google has partnered with Duke Energy, the largest U.S. utility, to buy solar power directly.
A power purchase agreement is, in essence, a long term contract to acquire electricity from a single facility at a fixed rate — over, say, 20 years. Because the purchases are in bulk, they have the potential to be advantageous from a price standpoint. In general, Google tries to buy power in such a way that the electrons can go straight to its data centers, says Terrell, but that isn’t always possible, given the current setup of the grid.
When it isn’t possible, the company instead buys clean energy on the same part of the grid as its data center, thus adding it to that grid — and then sells it back onto the grid and in effect attaches the renewable energy credits to its own operations. The key point, the company has argued, is to ensure “additionality” — the idea that through its actions, there is more clean energy in the world than there would be otherwise.
Google is not the only company buying clean energy. In the last several years, major purchases have also been announced by Apple, Facebook, Microsoft, Ikea and Walmart, among others.
“Google’s leadership has helped spark a race among global IT companies to build a renewably-powered internet, and shows how companies can help lead the way to a 100 percent renewable energy future,” said Gary Cook, chief IT analyst at Greenpeace, in a statement.
It appears to be a trend, according to the Rocky Mountain Institute, which recently found that while corporations contracted for 1.2 gigawatts of clean energy capacity in 2014, that increased to 2 gigawatts in 2015 (a number that presumably does not take into account the new Google announcement).
“Renewable electricity from large-scale, off-site projects has become attractive both economically (competitive prices can be locked in for up to 20 years) and for corporate sustainability,” notes a recent report on this market by the institute and several collaborators.
“We’re going to get renewable energy any way we can, no matter what it takes,” said Terrell.
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