First, the internet. Then smartphones. Now it looks like Google wants its piece of the energy pie as well. The company created a "Google Energy" subsidiary last month. It's also applied to the Federal Energy Regulatory Commission to be allowed to buy and sell power, like utilities. What exactly does the internet search leader want with energy? To be that much closer to taking over the world? Possibly. But it's more likely that the company just wants to enhance and protect its profit margin.
The New York Times' Bits blog reports:
Google said it did not have specific plans to become an energy trader and that its primary goal was to gain flexibility for buying more renewable energy for its power-hungry data centers.
"We want to have the ability to procure renewable energy to offset power usage of our operations," said Niki Fenwick, a Google spokeswoman. Ms. Fenwick said that having access to more renewable energy could help the company fulfill its goal to become "carbon neutral."
Right, because Google runs on energy, literally. Think about the thousands of databases and computer terminals sucking power 24-7 at Google's headquarters each day. Does it really want to have to rely on electric companies to control its energy costs? If it had some power over its energy sources, that could bend its cost curve dramatically.
So what Google is likely doing here is bracing for the inevitable increase in energy prices associated with the depletion of fossil fuels. It would likely prefer to shape its energy destiny by relying on cheaper, renewable energy sources in the years to come. While this has pleasant environmental implications, there's little doubt that Google has economic reasons for this endeavor as well.
But why the need to trade energy? Because if it eventually goes off the grid and lines up agreements with independent electricity producers, then it could end up with a deficit -- or surplus -- of energy at any given time. The company would benefit from greater flexibility to buy and sell that energy.
Or maybe it's just part of Google's plan for world domination. Perhaps, one day, we'll all get our energy from Google. And our mobile phones, maps, books, e-mail, videos, searches. . .