Warren Buffett Sells Google A Bunch Of Hot Air

Warren Buffett Sells Google A Bunch Of Hot Air
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Google Inc (NASDAQ:GOOG) will buy 407 MW of wind power from Warren Buffett’s MidAmerican Energy to power the Iowa data center that it started building in 2007 (h/t Ehren Goossens at Bloomberg) as part of MidAmerican’s Wind VIII program. This is the seventh and largest such deal that Google has made over the years according to its Google Green blog, bringing its total to more than 1 gigawatt of contracted renewable energy. Google has also invested more than $1 billion into renewable energy projects around the world that aren’t related to its own energy needs.

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Google / MidAmerican deal was in the works since 2007

While the deal was only just finalized (in time for Earth Day), Google Inc (NASDAQ:GOOG) has intended to buy wind power from MidAmerican since it first started construction on the data center, in line with the company’s pledge to be carbon neutral, which it made in the same year.

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“Google’s significant and growing presence within our service area, along with its long and demonstrated commitment to renewable energy, have been important factors in MidAmerican Energy’s pursuit of renewable power,” said Bill Fehrman, president and CEO, MidAmerican Energy. “In addition to increasing Google’s access to renewable energy, this agreement also reduces energy costs for our customers.”

This mirrors the 2012 agreement between Google Inc (NASDAQ:GOOG) and Oklahoma utility the Grand River Dam Authority, in that Google isn’t buying renewable energy directly from the producer. By partnering with the utility company instead of the energy producer, wind farms and other sources of alternative energy become integrated into the nation’s power grid instead of acting as a separate energy source that normal people and businesses don’t have access to. This has the potential benefits of making it easier for utilities to ramp up green energy along with demand and to reduce energy costs for other consumers.

Data centers are a growing source of energy demand

While it’s easy not to think about it when you are checking your email or searching for something, data centers use an enormous amount of energy and are quickly becoming a significant source of greenhouse gases (even if indirectly by raising demand) so large tech companies have had to spend a lot of energy figuring out how to get clean energy to their data centers without raising the ire of environmental activists. Google Inc (NASDAQ:GOOG) and Apple Inc. (NASDAQ:AAPL) have made big strides to minimize or offset their carbon footprint, but other tech firms including Amazon.com, Inc. (NASDAQ:AMZN) and Twitter Inc (NYSE:TWTR) have been criticized for their policies.

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