Mere days after Google launched its own phone, the Nexus One, it has come out with another big announcement: the creation of Google Energy, a subsidiary that it will use to buy and sell electricity on federally-regulated wholesale energy markets. Could it have plans to launch its own utility? Could you one day be buying your electricity from American’s favorite search engine instead of PG&E?
So far that seems unlikely. Yes, Google is applying to the Federal Energy Regulatory Commission for the ability to buy and sell electricity, but it doesn’t plan to market it to the general public. Rather, the company seems to want to lower its own energy costs by buying it on the wholesale market; and it has been very vocal about greening its power mix by buying electricity generated by renewable sources (it already derives power from rooftop solar panels at its Mountain View, Calif., headquarters, but this is only a small sliver of what it uses every day).
Considering the volume of greenhouse gas emissions produced by Google and its many energy-intensive data centers, the company is going to have a hard time achieving its goal of carbon neutrality. But buying more affordable, cleaner energy could give it the leg up it needs to actually become the first IT company to pull it off.
As for details on the entity that is now Google Energy, the company is playing it pretty coy. Spokeswoman Niki Fenwick says the search engine company doesn’t have any specific plans for it. But it seems like Google has been quietly creeping into the green energy business for a while now. First, it was proactive about installing solar panels and taking company-wide measures to be more energy and resource efficient. Then its philanthropic arm, Google.org, started supporting several alternative energy initiatives. Google Ventures has even invested in some related startups, including Smart Grid network provider Silver Spring Networks, solar enterprise Brightsource Energy, eSolar and geothermal developer AltaRock Energy. Then early last year, it launched Google PowerMeter, a browser-based tool for consumers to see how much energy they are using at home and how much it is costing them.
Google Energy may be the culmination of all of these smaller efforts — a venture that could finally make the company a major player in the energy industry. It’s not that far-fetched. If FERC grants it permission to buy and sell energy, it could very well launch its own utility. Of course it would have to hack through some more red tape, and ramp up a major marketing campaign, but it’s done it before.
So far, Google has denied that this is its end-game. But it wasn’t so long ago that the company said it would never launch a phone of its own, and now the Nexus One has landed. In November, Ed Lu, one of the leaders on the Google PowerMeter team, said at our GreenBeat 2009 conference that the company has no big ambitions for the tool and that it’s really just a “gift to humanity.” Not two months later, Google has taken another big stride into the energy world. It’s about time we learned that Google’s “never” never means never.