Specifically, Google purchases 3 GW of renewable energy and sells it to the grid at a loss.[1] This isn't the same as being directly powered by renewables because they don't have to worry about time shifting supply and demand, which is often done using natural gas.
A more important caveat is that it's only talking about their electricity usage, presumably people still drive to work in ICE cars, fly airplanes, ship devices around the world, the accounting for even just electricity usage can extend out to suppliers and suppliers of suppliers etc.
But it's still a very good thing and others should follow suit.
Also, can you show your working for them "selling at a loss". They generate renewable energy then sell the energy and keep the certificates that say it's renewable, those are both worth something. Are you saying they could have bought the certificates on the open market for less, because I don't think that's the case.
Google's report from 2013, cited from their blog, says that they resell electricity at a "slight net loss".[1]
I didn't compare to buying RECs. The point is that Google is 100% renewable voluntarily. While RECs may be worth some tax credits, it's obviously a net cost or else Facebook would also be 100% renewable.
That said, I'm fairly confident that Google's approach is more costly than just buying RECs because demand for RECs is not very high. Google doesn't buy RECs directly because they want stronger guarantees of additionality:
"Buying a few years’ worth of RECs from a renewable project does not provide the stable and sizable cash stream that a renewable project developer needs to get financing to build new green power projects. In a PPA [power purchasing agreement], Google is agreeing to buy all the power from a project for many years. Google has, in effect, totally accepted the power price risk that the project owner would otherwise face—instead of taking the risk of selling into the power market on a short-term basis, Google is providing the seller with a guaranteed revenue stream for 20 years. This is something the developer can literally take to the bank. If we were to buy only the RECs, this would represent a fraction of the value of a typical power project,5 and would still leave the renewable developer to face the market risks of future energy prices, making it much harder for them to obtain financing for projects.
Incidentally, this is close to how it works (at least around my part of the world) when you as a residential customer choose to buy solar/wind generated electricity. The retail electricity providers sell you electricity from a spot market (see https://en.wikipedia.org/wiki/Electricity_market#Wholesale_e...) and you pay the local power comapny to send you the electricity over the national grid.
BTW there's a big difference here between GW (power) and energy - do they contract 3 GW 24/7 or are they buying 24*3 GWh per day whenever the spot prices are lowest, or are they paying companies to average 3 GW per day over a multi year contract? In the first scenario there will be surplus over 3GW for most of the day.
3 GW measures average power. Google just buys the entire output of wind or solar farms, so supply is not matched with demand.[1] This is a known problem with renewables. Elon Musk claims that he can solve it with a relatively small area of batteries like the Powerpack, but he's sold less than 1 GW so far because batteries are expensive.
I guess that accounting is natural for marketing numbers.
I don't generally think it's a problem, it's just a feature of those generation methods and just means we need overprovisioning. Whereas fossil fuels have unsurmountable problems and cause untold human suffering, famines and damage to the environment.
I think that Google has made a fantastic step forward. However, solar and wind require some form of energy storage, such as pumped hydro or batteries (which Google hasn't addressed). Overprovisioning by itself isn't sufficient.
Can anyone explain this: If all they do is buy and sell electricity from renewable sources, while using the regular
grid to actually power the data-centers, then why do they do it at all? Is it a form of philanthropy?
Even if they were powering their data-centers directly from renewable sources, bypassing the grid, it would still be a form of philanthropy to whatever degree it raises their cost beyond burning coal and dumping the pollution on someone else.
Since global warming is a global problem (and other forms of pollution from burning coal or gas can travel long distances) it doesn't matter where the carbon is saved, it's basically equivalent, so they're just being pragmatic in their philanthropy.
This could be thought of as a subset of their wider goal to be carbon neutral (which again, could be described as philanthropic in nature), presumably funding the roll out of renewable energy seemed like a cost effective way to work towards that goal.
I don't get why this is the same thing : if every company is doing this, every company is still powered by fossil fuels, and just producing renewable energy that won't be used anywhere.
Edit: as the energy they buy is sent into the grid, if all companies do this, the renewable energy can be sufficient to power all companies, so I guess that makes sense
There is some cost to integrating renewables into the grid, though most experts seem to suggest the first 80% or so isn't that hard, and we're so far away from that in most places that the positive externalities massively outweigh any negative.
If people did use this model to get to 100% then presumably the final 20% or so would be more expensive, since you'd still be paying grid prices for your usage, then selling the same amount of renewable power to try to cancel out that cost. If that renewable power is worth much less, because of integration costs, then you'll be paying much higher costs overall.
(Note, paying much higher costs is a good thing, since it gives a market incentive for people to invest in storage technologies, demand/response, efficiency etc. This is similar to big companies like Microsoft changing an internal carbon tax to redirect investment).
And why do they sell at loss the energy ? Does this mean that they just exchange the energy they buy for grid energy to power their datacenter, and that the energy they get is cheaper than the one they're buying?
The spot price of power changes by the minute. Google pays for the wind farm's output; they're more concerned about replacing dirty MWs with clean MWs, and less about if they're making a profit on each MWh of power.
Thanks, this explains it.
Do you think there are numbers somewhere about how much carbon is saved globally due to this?
Them selling the energy may drive down the prices, increasing demand. So it could be that more energy is consumed at the same carbon level, rather then less carbon emitted. Perhaps they are paying for someone's bitcoin mining.
Google's approach subsidizes the additional cost of renewable energy sources over fossil fuels. Because Google sells exactly what they consume, they aren't actually inducing more electricity demand. And even if that was a factor, renewables are still an order of magnitude more green than coal.[1] So feel free to invest in solar companies :-)
By the way, carbon neutrality is easier to achieve than 100% renewable. Google has been carbon neutral since 2007,[2] which means that they purchase carbon offsets for their carbon usage. Carbon offsets are cheaper than renewable energy credits because there is lower-hanging fruit. For example, agreeing not to clear-cut a forest for 20 years generates millions of tons of carbon credits.
Still don't quite get it. Additional power sold to the grid means competition to the coal-burning power plants. Assuming the plant's only goal is profit, would they just produce less power and lose money? Or would they try to lower the prices, to possibly lose a little less money?
And then, if the prices do drop, the demand may rise due to
the drop, and could even lead to producing more power by the plant. So Google selling that electricity could yield to even higher carbon emissions. No?
I think your math on that last bit is off. The article states they have 1.2GW, which is somewhere between 40% and 50% of Amazon's power usage (started 2016 at 40%, expect to exit at 50%). That would peg 100% at somewhere between 2.4 and 3.
I'm confused, you mean that the bitcoin network takes 3.3GW or it takes 3.3GWh to mine one bitcoin? It seems that google takes the same electricity as the entire bitcoin network.
This is great progress, but there are still some significant low hanging fruit to consider. For example, the power it takes to display the all white background of the search and other top Google pages is significant. Changing that to black or partly black or some darker color could save amounts of energy that are hard to calculate and represent draw from all over the network.
The largest power drain in an LCD/LED screen is the backlight and that has to be running regardless of which color is being displayed. This would only benefit OLED screen (which doesn't have a normal backlight) which are pretty much only used on high-end phones and TVs. Unlikely to make a significant impact in energy use, and furthermore any amount of energy savings would likely be lost in the extra amount of black ink needed to print out pages.
Specifically, Google purchases 3 GW of renewable energy and sells it to the grid at a loss.[1] This isn't the same as being directly powered by renewables because they don't have to worry about time shifting supply and demand, which is often done using natural gas.
[1] cloud.google.com/environment/