Google (s GOOG) isn’t just continuing to invest hundreds of millions of dollars into clean energy projects; it’s also continuing to commit to buying up the clean power itself. On Thursday morning, Google announced it has made its second deal via its subsidiary Google Energy, and the search engine giant plans to buy 100 MW of power from a wind farm that’s under construction in Oklahoma.
Like Google’s previous clean power purchase agreement, the wind farm is being developed by NextEra Energy Resources. Google announced its first deal through Google Energy — its subsidiary which has been approved to buy and sell electricity on federally-regulated wholesale markets — in summer 2010, and that wind power purchase agreement was for a wind farm in Iowa, also owned by NextEra Energy Resources.
Google has also made investments through Google corporate in recent weeks in both solar farms and wind farms. The deal announced this morning is different in that it’s through Google Energy and is also a contract to buy the clean power itself over a 20-year period at a fixed rate (as opposed to buying equity in a clean power project).
Google’s Green Energy Czar Bill Weihl, who will discuss the news in depth at our Green:Net event on Thursday, told me in an interview on Wednesday that the 100.8 MW wind farm in Oklahoma will be built over the next six to nine months and Google has signed a 20-year power purchase agreement to buy the power. NextEra Energy Resources was looking for an anchor tenant to buy the power, and often, developers can use an anchor tenant to get a better financing rate.
Google wouldn’t disclose other financial terms of the deal, but Weihl said over the long term, he expects Google to make a decent amount of money on the deal. Wind power purchase agreements (wind is the cheapest utility-scale clean power out there) can set wind power rates around six cents a kilowatt hour for a 20-year contract, depending on location.
Google will buy the clean power from the Oklahoma wind farm, then sell it to the wholesale energy markets, given, for regulatory reasons, it can’t directly use the power for its own purposes. Weihl told me that in contrast to offsets that other companies commonly use to reduce their carbon footprint, Google is adding actual clean power to the grid, which both helps with Google’s carbon footprint and could make Google money.
However, it gets “interesting,” “subtle,” and “nuanced” when Google starts thinking about how it could use clean power for its data centers, as Weihl put it. It all seems like a grand experiment right now, but one day, perhaps, Google could build a data center near one of its clean power assets and tap renewable energy to power its servers. It’s still a confusing subject (did I lose you yet?) and Google has also released a white paper on the subject on its blog.
Tune into the live video feed of Green:Net to watch Weihl’s remarks at 1:30 p.m. PDT.