There’s been lots of speculation about Google Energy, a new subsidiary the Internet giant has formed to buy and sell power on the wholesale market. At the Earth2Tech Green.Net event today, Google energy czar Bill Weihl said most of the speculation is overblown, joking that the company had no plans to emulate Enron as an energy trading power broker.
But Weihl laid out a scenario in which Google Energy might help the company access renewable energy to support its huge data centers.
“Supposing we had a facility scomewhere in the Midwest and have power contracts,” Weihl said, noting that Google typically signs multi-year utility contracts. “Let’s say there’s a developer who wants to build a wind farm on land nearby. We’d love to buy the power from that wind farm.”
But for the project to succeed, the developer would likely need Google to sign a contract committing to buy the wind power it generates – which could obligate Google to pay for energy before its existing multi-year contract expires. Paying twice for energy due to overlapping contracts isn’t very efficient.
With the ability to buy and sell power, Google Energy could sign a contract to buy the power generated by the local wind farm, and then resell that power on the open market until Google’s existing utility deal expires and the company can use the renewable pwoer in its own facility.