Energy Independence for Google Stock?
As we inch closer to the end of 2016, companies are starting to release their big plans for next year. As always, Alphabet Inc (NASDAQ:GOOG) had something memorable to add: namely that it will meet 100% of its green energy requirements in 2017.
This should add an interesting new dimension to Google stock (GOOG), at least for those who are worried about climate change. Having a corporate entity—one of the biggest in the world—behave with social awareness is not something we see every day. (Source: “We’re set to reach 100% renewable energy — and it’s just the beginning,” Google Blog, December 6, 2016.)
“[We are] the world’s largest corporate buyer of renewable power,” wrote Google Senior Vice President Urs Hölzle in a blog post announcing the news. He added that Google now plans to “[directly buy] enough wind and solar electricity annually to account for every unit of electricity our operations consume, globally.”
However, this doesn’t mean that solar panels are going to be plastered to Google’s rooftops. The company is too large an organisation to simply “move off the grid.” Instead, it chooses to buy all its green energy from renewable sources, even if that means going through a traditional utility.
For instance, if a green energy company decides to set up a big farm of solar panels, rather than sell to end consumers, it signs a contract with utility companies. The solar farms feed the green energy onto the grid, which can then be purchased by companies like Google.
Utilizing these third-party sources is an important step for Google stock. Like its competitors at Amazon.com, Inc. (NASDAQ:AMZN), Microsoft Corporation (NASDAQ:MSFT), and International Business Machines Corp. (NYSE:IBM), Google is building new data centers across the world. The existing data centers use three percent of the world’s electricity; a number that is expected to triple once these companies are done expanding.
In other words, tech companies will be consuming roughly 10% of the world’s energy supply just to power data centers. The energy demands will be extraordinary, but they have made public assurances that most of the energy will come from renewable sources.
“The science tells us that tackling climate change is an urgent global priority,” Hölzle wrote. “We believe the private sector, in partnership with policy leaders, must take bold steps and that we can do so in a way that leads to growth and opportunity. And we have a responsibility to do so — to our users and the environment.”
Google stock (GOOG) was up 1.35% at the time of writing, hovering at $769.22.