Supply Excellence — Sustainability Powers Google Lastest Gig

Sustainability Powers Google Lastest Gig

November 30th, 2007 · by Tim Minahan · No Comments · enviro/social sustainability, supply management, supply market dynamics

Earlier this week, Google announced plans to get into the alternative energy business. The Web search and advertising giant plans to spend $500 million to buy companies and hire engineers to develop new and more affordable solar, geothermal, wind, and other alternative energy sources.

The “Renewable Energy Cheaper Than Coal” initiative plans to “produce one gigawatt of renewable energy capacity that is cheaper than smog producing coal. Google execs expect to achieve this gigawatt milestone — which could power a large city — within “years, no decades.”

Noble goal. But, it raises a question: Who the heck would buy power from their search engine provider? The short answer: Google itself.

In fact, when announcing the initiative, Google execs were careful to state that the move to find cheaper power was fueled by a need to lower its own electricity bill. The company’s patented data centers house hundreds of thousands of servers that run their leading search engine.
With rising oil and energy prices, power consumption has become top of mind for most large, data-centric companies — from the high-tech to the financial sector. In fact, as recently reported here Ken Leinweber, Strategic Sourcing Manager, Procurement and Operations Strategy at Sun Microsystems estimates that “IT on average spends 25% of their budget on power. In the next five years or so, folks will be spending more money on power than they will on the hardware.”

Just consider the additional commodity savings you’ll need to identify and capture to offset those rising power costs. If that’s not a rallying cry for sustainable supply strategies, I don’t know what is.

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