From the November 2011 issue of Treasury & Risk magazine

Buying From the Wind Farm

Google won a Gold Alexander Hamilton Award for Best Green Strategy for the financial arrangements it designed to buy wind power.

Kojo Ako-Asare, corporate finance manager; Adrian Garcia, corporate finance analyst; and Axel Martinez, assistant treasurer Kojo Ako-Asare, corporate finance manager; Adrian Garcia, corporate finance analyst; and Axel Martinez, assistant treasurer

Using renewable energy to fuel its data centers is one of the ways Google is fulfilling a four-year-old commitment to reduce its carbon footprint to zero. But electricity generated from the sun or wind isn’t the best match for the data centers operated by the $29 billion Internet search engine provider. Wind isn’t constant and sunshine is limited, while data centers have to have power around the clock. Nor can the energy be stored for later use to deal with the differences in the timing of supply and demand.

So Google’s 2010 signing of a 20-year contract to buy 114 megawatts of electricity a year from a wind farm in Iowa being developed by NextEra Energy posed a challenge, one that Google solved with a series of financial transactions involving the electricity grid and the power markets.

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