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Google Invests in Wind Farms

Is the Upper Midwest the new Silicon Valley?

Last year, Google surprised people when it said it would begin to invest in
renewable power
projects.<http://www.greentechmedia.com/articles/read/google-to-fund-power-plants/>

Today, it followed through with the plan.

The search giant said it has invested $38.8 million into two wind farm
projects in North Dakota that will generate 169.5 megwatts of power. NextEra
Energy Resources is the developer.

"To tackle this need, we’ve been looking at investments in renewable energy
projects, like the one we just signed, that can accelerate the deployment of
the latest clean energy technology while providing attractive returns to
Google and more capital for developers to build additional projects,"Google
stated.<http://googleblog.blogspot.com/2010/05/not-merely-tilting-at-windmills.html>

The investment does not come from Google.org, which has made sporadic
venture investments, but Google proper. Last year, the company got
permission to sell electricity like a
utility.<http://www.greentechmedia.com/articles/read/it-official-google-can-now-sell-power-like-a-utility/>

Who knows, it might even lead to data centers in the region. Google has a
massive electric bill because of its data centers and continually seeks ways
to integrate renewables into the mix. Generating power in remote areas
creates problems because power gets lost in transmission. Building data
centers in remote locations can lead to increased data latency, but it's a
smaller problem and one that can be ameliorated through data center
architecture and application management. That's why Iceland says it can
"export" geothermal power. Iceland will harness the power from geothermal
wells to run data centers, which will then funnel data to North America and
Europe.

There are a few spare acres in North Dakota for this kind of construction.

While wind costs less than solar and provides more power than solar in the
U.S., it has not been a favorite of Silicon Valley. VCs have looked at wind
as a market that will be dominated by big companies. But in recent months,
investors have begun to sniff around and even plunk money into companies
that provide components to turbine developers. Last week at Nordic Green II,
Jim Kim from Khosla Ventures said he was looking at some wind opportunities.
Maurice Gunderson of CMEA pointed out to us recently that his firm has an
investment in Danotek Motion Technologies in Michigan, which has developed
permanent magnet generators for wind turbines.

Interestingly, Kim also said he thinks Michigan could be the next hot spot
for investors: lots of supply chain and mechanical engineering experts
there. Danotek is one example of that.

Oh, Geez! Maybe you should reserve that U-Haul now.
--
Eric D. Schwerin
Rosemont Seneca Partners
(202) 333-1880
eschwerin@rosemontseneca.co