Summary: Google has struck its first purchase power agreement in Europe, helping kick off a 72MW capacity wind project in northern Sweden.
Google will buy the entire output of a new 24-turbine wind farm in northern Sweden to power its datacentre in Finland.
Google on Tuesday announced its first European power purchase agreement with Swedish wind farm company O2, under which the internet giant has guaranteed to buy the 72MW capacity farm's entire output for 10 years.
German insurance company Allianz is bankrolling the project and will take over its first Swedish wind farm when it is scheduled to become operational in 2015, retaining O2 to maintain the facility.
Google's Finnish datacentre in Hamina (not far from St Petersburg, Russia) will not actually consume output from wind farm, which is located 800km away in the northern Swedish town Maevaara, which straddles the Övertorneå and Pajala municipalities.
Similar to Google's US 20-year agreements with wind farms in Iowa and Oklahoma, the 72MW output that Google buys in Sweden over 10 years will be sold at local market prices into the regional grid via Nord Pool Spot — a power trading market for the Scandinavian and Baltic regions. Google gets a Certificate of Origin from the Swedish farm which it can then use in Finland to consume an equivalent amount of energy.
Google expects to make a small net loss in the short term since "generic energy" is cheap. However, it expects the contracts to make money as power prices rise. In the US, it uses renewable energy credits (RECs) for its datacentre where one credit equals one megawatt-hour and helps the facility become treated as carbon free.
How Google's power purchase agreements work. Image: Google The agreements differ slightly to the one it signed for another Oklahoma facility in Mayes County last year, where it contracted directly with a utility for the supply of 48MW of wind energy from the Canadian Hills Wind project in west central Oklahoma.
Liam Tung is an Australian business technology journalist living a few too many Swedish miles north of Stockholm for his liking. He gained a bachelors degree in economics and arts (cultural studies) at Sydney's Macquarie University, but hacked (without Norse or malicious code for that matter) his way into a career as an enterprise tech, security and telecommunications journalist with ZDNet Australia. These days Liam is a full time freelance technology journalist who writes for several Australian publications, including the Sydney Morning Herald online. He's interested primarily in how information technology impacts the way business and people communicate, trade, and consume.
