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Bill Weihl Roundtable Q&A
Friday, February 26, 2010
Bill Weihl, Clean Energy Czar Google
Executive Discussion Q&A, Portland OR 2.24.2010
Bill Weihl talked with 35 Oregon area executives in the Renewable Energy, Green Building, Energy Efficiency, Software / Hardware technology, Government and Education sectors and the following is a summary of the dialogue.
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Bill introduced himself and the internal initiatives and projects Google has undertaken for data center efficiency as well as further use of renewable energy sources. He shared information about Google’s hope to have an impact on the world by using its natural skills for data collection combined with an easy interface to help drive residential energy efficiency. Google.org is passionate about helping consumers drive down energy use and the company is highly interested in renewable energy sources at scale.
Q: How does Google make the decision to invest in a company to help prove out the technology?
A: There are two things we look for. First, can this technology have an impact at scale. It is important that it can be used around the world and is not geographically specific. Second we ask ourselves is the cost of energy competitive. It is critically important that renewable energy resources are close to their dirty alternatives. The first few installations might likely cost significantly more but when the scale gets to a gigawatt or more the cost needs to be around 5-6 cents a kilowatt hr. If those two elements are there and the company has a plausible change of success we are very interested.
Q: Has Google invested in Biomass and what are your thoughts on that form of renewable energy?
A: We haven’t invested in this sector yet. To date we haven’t seen any areas that would be able to scale effectively. To get a plant of any size you have to get stock from a large area which brings with it shipping costs and drives the price to a place where it’s not competitive. If you have more numerous, smaller plants you lose economies of scale. This very well could be a good regional investment but we look for things that have major market potential.
Q: How has Google been involved with transmission policy work?
A: We have invested in companies eSolar, Brightsource and Alterock but haven’t been working specifically on transmission efforts. We do realize that this is a critical issue especially as PVs start coming on hard and fast.
Q: What do you think about the idea of SmartGrid urban districts?
A: We have invested in companies like Current Technologies and Silver Springs and are mostly focused at utility scale, central plants and grids, not so much the distributed model. Things in the 2-3 megawatts and above have been our focus but we are excited for the continued distribution of renewable energy microprojects.
Q: Where do you think there are Global areas of challenge and opportunity?
A: China and India have cheaper, dirty options making renewable and clean energy options all the more challenging. China on one hand has major national investments in both deployment and R&D. In the US we are at political gridlock and aren’t able to do much of anything. All of us in industry need to be pulling the rope rather than pushing it and waiting for the federate government to give us some incentives or tax benefits that are go to move the industry forward.
Let’s say for example we want 20-30% of the grid to be from Wind Energy. With tax credits and other incentives, that industry has been through huge peaks and valleys with rushes to get projects done when they are enacted and all together stand-stills when there is uncertainly or changes in those incentives. Incentives that we have to enacted do, to some extent, drive demand and bolster the supply chain but they are not encouraging innovation and technologic breakthroughs which are critical.
Q: How can we partner with Google to influence or even make things happen in Washington, D.C.?
A: D.C. is a very tough place to gets things done. The first and most important thing we need to make clear is that investment in Clean Energy R&D would be good for this nation’s future, something to the tune of $15 billion annually. Eric is on Obama’s tech council and has the opportunity to speak directly to the President but even then it’s tough to turn those ideas and recommendations into action. We need to look to the industry for answers and to solve problems through innovation and technology development. We also serve with others on groups like Climate Savers and Green Grid to help move initiatives forward for things like higher adoption of efficient computers and servers.
Q: What does Google plan to do with the RERC filing to become a federally regulated utility?
A: We did apply for the FERC filing but Google does not intend to become an energy trader or a utility. We are not in the business of selling energy, nor do we intend to be in that industry in the short term. Google does some crazy things, and I am not saying that we never would be in that area, but the challenges of being in the business that utilities are in with their regulations are simply not ones that we care to take on. The purpose for that application was so we could have access to market completive clean energy options that we could purchase and use. We want more renewable energy generation on the grid not simply a trade of cash for recs.
Here is an example: Say for instance we want to purchase a long term PPA for around 20 years from a wind developer. It is very challenging to time the completion of a datacenter with the completion of a wind project. Or if we wanted to use it for an existing site it is difficult to time the completion of the wind project with the end of an energy agreement. Rather than pour money down the drain after purchasing clean energy, while we are not using it we would like to sell that energy until we are ready to consume it. Rather than have a 3rd party do all this we would like to do this all ourselves. We always like to do it ourselves if we are able, so we can make sure it is done in just the correct way for us.
Q: Can you talk about the energy use portfolio for your Datacenters?
A: We have found it to be very hard to find renewable energy that comes close to making market sense. We are willing to pay a bit extra over dirty options but we, like any business cannot afford to waste money by paying exorbitant premiums. We have the choice of taking the money we make from our business and putting it toward the bottom line or investing it in things like renewable energy. We do invest some now in clean and renewable energy and I hope more so in the future. We do have some internal goals for carbon intensity. With a company like ours, growing at the rate we do, a goal of cutting carbon use by 50% just is not possible, at least I have not found a way yet. If everyone decreased their carbon use intensity by say 5-10%, which is approximately what we are trying to do, we would be doing far better that even the most aggressive models out there.
Q: Are there ways that the NW could market itself more effectively to gain interest for various investments?
A: Sure, site selection of datacenters for example is very important and major companies like Google are very through with their analysis. We chose the NW for a variety of reasons, one near the top being the comparatively clean energy mix at a reasonable rate. We think that other companies will find the area to be a desirable place to bring datacenter and other investments. Take Facebook for example with their recent datacenter investment in Central Oregon.
Q: How can the NW be more of a leader?
A: You have pretty good resources here: wind in the gorge, solar out East, geothermal and wave. You also have a nice climate for datacenters. The evaporative cooling in the Google datacenter in The Dalles is very efficient. As I mentioned earlier there were many reasons that Google choose to locate in Oregon and the continued strong mix of clean energy at a relatively low price is very appealing.
Q: How did Google address efficiency especially in a location like the Dalles where power is cheap?
A: People often overlook efficiency and how to capture those savings - for what reason I really do not know. Eric takes inventory on opportunities that staff bring about for operational efficiencies and he simply asks one question: what is the payback time? If they come back with an answer like 18 months, the answer is "of course”. Typically we aggressively implement any efficiency projects that have a payback of under 3-5 years. At Google we are big believers in Total Cost of Ownership. To effectively get many of the efficiencies in the business we need to break down barriers like ones between facilities and IT and between CAPEX and OPEX. We need to be able to take on additional capital expenses upfront that in the long term are the best for the company. Specifically in the datacenter environment we brought our PUE (total energy used divided by energy used for IT equipment) from about a 2.0, which is the industry average, to around a 1.2. That is an efficiency increase of about 80% and we used relatively simple measures to do that like completely separating hot air and cold air, raising the room temperatures and having highly efficient UPS systems. Back to the conflicts between facilities and IT / CAPEX and OPEX, unfortunately people often don’t make the right choice so get some of the market changes we need for efficient product adoption mandates may be necessary.
Q: How can you change behavior to have the majority of people making the right choices?
A: We need to look for ways to make persuasive change. We also need to leverage the social mechanisms that are in place with today’s technology to help convince people to go against the pressures out there. For example we are developing a collaborative and sharing capabilities for the PowerMeter. Imagine if you could share your energy use with your neighbor or friend, can’t you see the competition driving change potentially even more than the money saved. People love competition. We also need to impact our youth. They understand clean energy and responsibly for this planet. Wouldn’t a classroom or family competition to see who can use the least amount of energy or have the best improvements be engaging for them.
Q: How does PowerMeter interact with utilities on a technical and business level?
A: First, the product is free. We don’t charge the utilities for the product nor do we charge the users. It is a widget that takes up a small amount of real estate on someone’s iGoogle page so they can occasionally look at their home’s overall energy use. It sits alongside other pieces of information such as the weather update and latest news. Most of the apps on iGoogle are developed by outside partners since the API is open. We hope that many more innovative companies will develop useful tools for the PowerMeter as we open the API for that as well.
Back to the PowerMeter relationship with the utilities, we are looking for as many partner utilities, Co-ops, and Munis who have smart meter installations as we can get. Typically the IT setup is minimal so the only cost is a few weeks worth of time for an IT person or two to set up the relationship. The PowerMeter project is funded by our .org, meaning that the sole purpose is to drive down energy use - i.e. get more people using less energy.
We hope that in the future it will graphically let people know about their uses at peak energy times which are the most costly for the utilities. If we can help the users bring down load at those peak times, we may be able to prevent utilities from bringing on new and expensive generation. We still are in the early phases of the use of the PowerMeter but we roughly have seen a 10% decrease in energy use from the participants and look forward to studying this further as well as seeing how we can provide people with useful information about how to use less energy.
One example of how the tool, even to date without those specific recommendation features and algorithms, is helping people reduce energy use is from one of our employees who is lucky enough to have a pool. She noticed by comparing her data to some of the others with similar sized houses that her energy use was unusually high. She ended up finding out that her pool pump had been running for years constantly. After she got it fixed she saved thousands of dollars over the next few years.
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