Google continues to invest in innovative sources of alternative energy, and that brings the California cash machine all the way to Oklahoma.
Through its subsidiary Google Energy LLC, the search engine giant recently announced a deal to buy electricity from an Oklahoma wind farm to power its new data center near Pryor. The $600 million facility is one of four developed by Google in the past four years. It's located on the 9,000 acre Mid-America Industrial Park, the largest rural industrial complex in the nation, and is expected to open later this year.
Google's electricity doesn't actually go directly from the wind generators to their data center, 180 miles away. But the electricity enters the grid and effectively substitutes a megawatt of electricity for every megawatt of power it draws down for its data center in Pryor. The result is a "greening" of Oklahoma's power grid and another move away from carbon-based energy sources for Oklahoma's economy.
Florida-based NextEra Energy Resources is developing the 100.8 megawatt wind farm near Minco, between Oklahoma City and Lawton. NextEra has the largest collection of wind farms in North America, generating 8.3 gigawatts of power. They already have more than 300 wind turbines in this state, enough to power over 137,000 average homes. But this 20-year contract with Google will keep energy flowing toward Google's servers, which draw huge quantities of power.
Google operates over one million servers in data centers around the world, and process over a billion search requests every day. IT and telecommunications facilities like Google's account for about 120 billion kilowatt hours of electricity a year, about 3% of all U.S. electricity use, according to the Energy Department. The current rapid growth in this industry would require the construction of two new large power plans a year just to keep pace - or alternative investments like wind power. (Google is also installing solar panels in California to provide up to 1.6 megawatts of electricity, enough to meet 30% of the energy requirements of their California corporate headquarters.)
The Grand River Dam Authority (GRDA), which powers Mid-America, has total production capacity of about $1,728 megawatts. Because over half of GRDA's power comes from hydroelectric and natural gas powered facilities, it is able to keep its cost per kWh down to $.0528 for industrial users (2009 figures). The average cost in the United States is 62% higher, and that was clearly a factor in attracting electricity-guzzling Google to the plains of Pryor. (Right to work, by the way, had nothing to do with it.)
Google is clearly sensitive to criticism from environmentalists about the amount of energy it consumes. Besides receiving sales tax and property tax incentives from state and local governments, Google persuaded the Oklahoma legislature to pass a law allowing municipal power companies to not report the power usage of their largest industrial customers. As a result, the local utility in Pryor doesn't have to disclose the amount of Google's energy usage. Now, Google has the additional argument that it is offsetting their massive power consumption with green energy. That lack of transparency may not reflect well on the company that has done so much to make information readily available to all.
This is the second such investment for Google Energy. Last year they invested $38.8 million in two NextEra wind farms worth 169.5 megawatts in North Dakota, buying a 20% stake in the project. They also bought 100 megawatts of Iowa wind energy from NextEra on a 20 year contract, near their Council Bluffs data center. Google Energy is also an investor in a project to build the Atlantic Wind Connection, an underwater cable network off the Atlantic coast designed to connect future offshore wind farms with on-shore transmission grids.
The Federal Energy Regulatory Commission (FERC) now has authorized Google to buy and sell electricity on the wholesale market. Although Goggle expects to primarily power their own facilities, hundreds of large industrial consumers like Alcoa and Walmart have similar market-based rate authority.
All this reminds me of how the railroad barons in the 19th century fueled expansion across the United States. Cornelius Vanderbilt made a fortune in steamship lines, beginning with a ferry service between Staten Island and Manhattan when he was 16. By 1864 he'd sold all his steamships and concentrated on railroads. At the time of his death he was worth the equivalent of about $150 billion in today's currency. He and his competitors, folks like Jay Gould, invested millions in expansion of the railroads. Although ruthless business characters (and I'm not implying that the folks at Google share the same personality shortcomings), these capitalists made it possible for westward expansion to succeed. And, while the federal government helps by creating incentives, the dollars come from private hands.
The point is, somebody has to be on the front line, making the investments to bring down the cost of doing business. What Vanderbilt did with railroads in the 1800s, Samuel Morse did with the telegraph, AT&T did with telephones, and Bill Gates and Steve Jobs did with computers, now Google is doing for alternative energy. It's a critical step in the transition from carbon-based fuels to renewable energy. With lots of wind energy, Oklahoma's in a great position to benefit from the extra jobs and spending in the local economy.
Welcome, Google! And welcome, Oklahoma, a step closer to the 21st century!
No comments:
Post a Comment