① In order to cope with the pressure of the “AI arms race” and meet previously promised emission reduction targets, major technology companies are striving to increase investment in the field of green electricity; ② In addition to photovoltaics, green steel, concrete, and even power grids have become “favorable concepts for AI” as a result.
Financial Services Association, May 24 (Editor Shi Zhengcheng) The “AI benefits photovoltaics” logic frequently mentioned in the US stock market was tested on the other side of the Pacific on Thursday — according to local Japanese media reports, in order to simultaneously meet the electricity consumption needs of data centers running AI and the 2030 clean energy target, Google signed agreements with a number of Japanese renewable energy suppliers to purchase clean electricity and build solar power plants dedicated to Google data centers.
After Microsoft and Amazon, Google is another major AI company in Japan that exclusively invests in solar power supply.
Purchasing exclusive solar power for the first time in Japan
According to reports, Google has signed a corporate power purchase contract with Japan's Clean Energy Link (CEC) company and Shizen Energy (Shizen Energy). The two companies will build solar power plants dedicated to supplying Google data centers in many parts of Japan.
According to reports, CEC, a joint venture between Itochu Corporation and Kansai Electric Power and other companies, will invest 10 billion yen (about 461 million yuan) by 2026 to build about 800 solar power plants, with a total power generation capacity of close to 70,000 kilowatts. Natural Power will develop a solar project specifically for Google in the Kanto region. It is expected to be put into operation in 2027, with a power generation capacity of 30,000 kilowatts.
Google's goal is to fully use clean energy throughout the company, including data centers and offices, by 2030. By the end of 2022, Google's carbon-free renewable energy usage rate was 64%. Among them, the share of clean energy in many states in the US, Finland, and Denmark had already exceeded 90%, while in Japan it was only 16%.
Coupled with Google's expectation that it will open new data centers in Hiroshima and Wakayama prefectures, demand for clean electricity will increase further in the future.
Drive demand throughout the industry chain
In addition to Google, the other two cloud computing giants, Amazon and Microsoft, had an earlier green power layout.
Amazon is cooperating with companies such as Mitsubishi Corporation and CEC to obtain solar power. At the same time, as an e-commerce giant, Amazon has also installed solar panels on the roof of local logistics warehouses. Microsoft has signed a power purchase agreement with Natural Power, and a solar power plant “exclusive to Microsoft” began commercial operation in February of this year.
However, whether these green energy purchases and investments can keep up with the pace of the “AI arms race” is still a question.
According to the sustainability report disclosed by Microsoft last week, the company's global greenhouse emissions in fiscal year 2023 were 30% higher than in 2020. Microsoft President Brad Smith also acknowledged that with regard to the “carbon emission lunar landing plan” proposed in 2020, if only the expansion of AI and the prediction of corresponding electricity demand are taken into account, then the “distance to land on the moon” is now 5 times that of 2020.
(Microsoft's carbon emissions have increased significantly over the past year, source: Microsoft)
Smith also said that in order to achieve environmental goals, the company needs to make significant progress in green steel, green concrete, and reducing carbon emissions from chip manufacturing.
Due to the huge demand for AI, in addition to existing data centers being fully loaded, tech giants are also rapidly increasing the construction of new data centers. Since this year, Microsoft has announced new data centers in the US, Thailand, Indonesia, Spain, Germany, and Japan.
Microsoft Chief Financial Officer Amy Hood revealed earlier that from July of last year to June of this year, the company plans to invest more than 50 billion US dollars to expand the data center. In the year after starting in July of this year, data center investment is expected to be even higher.
Smith also said that in order for Microsoft to obtain more green electricity, one of the major bottlenecks is the lack of transmission networks from power generation locations to data centers. This is why the company will increase its lobbying efforts to push governments to speed up the pace of grid construction.