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Google on Monday said it’s invested $38.8 million into 169.5 MW worth of wind projects developed by NextEra Energy Resources in North Dakota. It was the search engine giant’s first direct investment in a wind power project and the money came out of Google Inc., in contrast to previous investments out of its philanthropy arm, Google.org. We got a chance to ask Rick Needham, Google’s green business operations manager, 10 questions about the company’s plans for the wind power project.
Earth2Tech: Why did Google make its first direct investment into utility-scale clean power into these particular projects?
Needham: We’re aiming to accelerate the deployment of renewable energy in a way that makes good business sense. These particular projects were attractive because they offered good returns for our capital, based on the risks of the projects, and allowed us to partner with experienced developers and investors. They also use turbines that take advantage of the excellent wind resources in the area and are able to use existing transmission capacity, resulting in low cost clean energy.
Earth2Tech: Why make this investment now, two and a half years after you first launched RE<c?
Needham: Our RE<c effort is focused on supporting policies and investing in and developing technologies that can help usher in an age of low cost renewable energy. This investment is different from previous RE<c investments, but is an example of the dedicated financing that is necessary for deploying renewable energy technologies at scale. We made this current investment to generate attractive returns on our capital while providing greater financing capacity to the market that accelerates the deployment of more renewable energy.
Earth2Tech: Does Google plan to make more investments into clean power projects?
Needham: Yes, we hope to find more opportunities to invest in renewable energy projects that provide attractive returns and use the latest technologies to push the envelope for delivering low cost clean energy.
Earth2Tech: Google has said this is a financial investment. What kind of return is Google expecting to get?
Needham: We won’t disclose projected returns, but do expect to earn an attractive return as well as free up capital to enable future wind projects.
Earth2Tech: Is this Google’s first clean power investment that hopes to make money?
Needham: No. We also hope to make money on our investments in early stage renewable energy technology companies as well. Earning returns means the companies have been successful in developing low cost renewable energy solutions.
Earth2Tech: Is there any connection to Google’s energy subsidiary here and the ability to buy and sell electricity on wholesale markets?
Needham: This investment is not related to Google Energy. Google is interested in procuring more renewable energy as part of our carbon neutrality commitment, and the ability to buy and sell energy on the wholesale market could give us more flexibility in doing so. We created Google Energy so we can have more flexibility in procuring power for Google’s own operations, including our data centers. This investment was not made with Google Energy and does not provide renewable energy for our portfolio.
Earth2Tech: Google has said it expects to invest hundreds of millions of dollars into clean power startups and projects. How much has Google invested into clean power and energy projects and startups to date?
Needham: Through our philanthropic arm, Google.org, we’ve invested more than $45 million in clean energy technologies, including advanced wind, solar thermal, and enhanced geothermal systems. Our investment in the North Dakota wind farms is for $38.8 million.
Earth2Tech: Is Google working on any of its own wind technology development, the way it has a side project to develop a solar thermal receiver?
Needham: In some places today wind power can already be competitive with other forms of energy, but more innovation will further reduce the cost of power. One challenge to deploying significantly more wind power is getting wind power from where the generation is (where the wind blows) to where the loads are (where energy is used), which something we’re also interested in exploring.
Earth2Tech: What does Google expect the cost of the clean power will be that comes out of the NextEra wind projects?
Needham: We don’t disclose the cost of the power, but it is competitive with other forms of energy and is being purchased by a few separate offtakers in the region.
Earth2Tech: Will Google use the NextEra wind farms for an R&D test facility for anything?
Needham: We do not have any current plants to use the NextEra wind farms for any R&D testing.
This article also appeared on BusinessWeek.com