The 24x7 clean energy goal

In India, it is not easy for consumers to buy clean power. Nor is it easy for consumers to buy non-clean power, given the state of the power distribution companies

The idea that Google floated earlier this month is simple: It wants the energy it consumes in each of the 8,760 hours that make up a year to be carbon-free. The company is already powered 100 per cent by renewable energy — meaning it buys enough clean energy to offset its consumption — but it is now stretching its ambition.

Google wants to match the hourly power demand in each of its data centers with supply of “carbon-free energy”. The aspiration for 24x7 carbon-free energy means it will be powered by renewables and nuclear power, since neither involves any direct carbon dioxide emissions. 

The group has tracked hourly demand and consumption of power at some of its centres. It found such matching of demand with green power supply was the case for a significant number of hours in many regions, but it was not 100 per cent for any facility, though the data centre at Hamina in Finland came close. 

Bloomberg NEF expects the new goal to lead to more green energy purchases by the company, and also usher in a new era of corporate energy strategy. Google is already the world’s largest corporate buyer of renewable energy, with power purchase agreements totaling 3.2 gigawatts. It intends to build further on that number. Facebook is the next on the corporate buyers list with 2 gigawatts. Norsk Hydro, Microsoft, Amazon and Apple are among the top corporate buyers of clean energy. 

In 2018 so far, our data shows that companies have bought 8.7 gigawatts of clean energy through power purchase agreements, against 5.6 gigawatts in the whole of 2017. Most of the purchases are in the US, and for wind power. The top buyer this year is Microsoft.

For companies looking to walk down the carbon-free energy path, Google shared the following insights:

• Enabled by energy purchases: Purchases of renewable energy since 2010 has enabled it to progress towards the 24x7 carbon-free energy ambition
   
• Diversity is key: A geographically spread, diverse portfolio including different types of renewables and carbon-free sources, and as the use of storage or carbon capture can mean more carbon-free energy in the mix
   
• Look at the grid: A grid with a higher share of carbon-free electricity helps in the 24x7 carbon-free energy goal, since there tends to be some consumption from the grid
   
• Policy and market structure: These are obstacles in some regions to Google’s ambitions on energy. “As retail and wholesale energy markets become more nimble and customer-centric, such that any electricity customer who wants clean power can purchase it, we will be better positioned to deploy carbon-free energy worldwide,” it said in the discussion paper.

In India, it is not easy for consumers to buy clean power. Neither is it easy for consumers to buy non-clean power, given the state of the power distribution companies. There are proposals to restructure the market, however, and to rationalise and simplify tariffs across states.

A draft recommendation circulated last month by the power ministry talked about doing away with the categorisation of consumers as domestic, commercial, industrial, etc and instead segmenting users on the basis of sanctioned load and consumption. Interestingly, a separate category for electric vehicle charging stations was also given as an option.

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The author is editor, Global Policy for Bloomberg NEF. Email: vgombar@bloomberg.net