Google’s Green Agenda

Date: 2nd October 2008

Author:  Business Week

Posted by: Rob Hof on October 02

A few hours after Google issued a clean energy manifesto, CEO Eric Schmidt on Wednesday night held forth on the search giant’s plans and hopes for setting an entirely new agenda for energy in the U.S. This morning, Jeffery Greenblatt, Google’s Climate and Energy Technology Manager in the San Francisco Bay Area, issued Clean Energy 2030, a proposal to reduce the country’s dependence on fossil fuels. The plan calls for greatly expanded use of wind, geothermal, and solar energy.

Schmidt commissioned the $4 trillion proposal, which is intended to complement other alt-energy proposals from former Vice-President Al Gore and onetime oilman T. Boone Pickens, as a way to influence whatever new administration is elected. Speaking to an audience of several hundred people in San Francisco, he said moving to alternative energies will more than pay for itself eventually in savings of various kinds, and blamed “a total and complete failure of leadership” in the government for an inability to set the country on the road to energy independence. “It’s cheaper to fix global warming than to ignore it,” he said. “The payback on energy efficiency is enormous.”

Google’s not spending much in absolute terms on its investments in alternative energy companies—about $45 million through its philanthropic arm. But its executives have been spending a lot of time lately pushing green energy. Why?

One reason, of course, is that the company is a huge user of electricity for its data centers—though it blogged today that its data centers use only 20% of the electricity of the average one. So any reduction saves Google a lot of money. Another reason, Schmidt frankly admitted to reporters after his talk, is that it’s positive branding for Google.

Yet another, very Googley reason, is that fixing the energy grid, the system by which energy gets delivered from where it’s produced to where it’s needed, is one of the most fascinating systems design problems around. Indeed, he says Google’s systems and network design expertise could contribute to development of the “smart grid”, a proposed new electrical infrastructure that can run much more efficiently and reliably. It includes such notions as allowing electricity to flow back and forth between power sources ranging from solar and wind farms to plug-in car batteries around the country. “If you do this right, it sure sounds like the Internet,” he said.

Still, he says there’s a less practical reason that comes straight from Google cofounders Sergey Brin and Larry Page: Hokey as it may sound, they see greater use of alternative energies as a way to make the world better. So does Schmidt, who added, “To me, it’s a moral issue. We should demand that people realize the implications of short-term thinking.”

Some Wall Street analysts have raised eyebrows at Google’s attention to energy issues, but Schmidt waved off those concerns. “Our shareholders are used to this sort of stuff from Google,” he smiled.

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