On June 13th, Caixin news announced that US technology giant Google announced on Wednesday (June 12th) that it has reached a power agreement with NV Energy, a utility company owned by Berkshire Hathaway, to provide advanced geothermal energy to Google's data centers in Nevada.

The agreement has been submitted to the state's public utilities regulatory agency for approval, and the partnership will help Google achieve its goal of using clean energy completely by 2030.

According to Google's latest environmental report, 64% of the company's global business is powered by carbon-free energy sources, including wind and solar energy.

However, solar and wind power rely heavily on available sunshine and wind, which is unstable, leading companies including Google to consider stable clean energy sources such as nuclear and geothermal energy.

The electricity demand for data centers is increasing rapidly.

In the era of explosive artificial intelligence applications, numerous large technology companies continue to invest in and expand data centers to train large language models, resulting in a rapid increase in their power consumption.

So far this year, Google has announced plans to invest at least $4 billion in constructing or expanding data centers in Indiana, Missouri, and Virginia.

A Goldman Sachs research report shows that by the end of 2030, artificial intelligence will drive a 160% increase in data center power demand, and the bank predicts it will cost about $50 billion for US electric utilities alone to invest in new generation capacity to support data centers.

This has attracted the attention of the Biden government, as it complicates the government's climate goals. Biden has stated that he plans to achieve decarbonization of the power industry by 2035.

Last week, U.S. Energy Secretary Jennifer Granholm pointed out that the Biden administration is asking large tech companies to invest in new climate-friendly power generation facilities to meet the soaring power demands of their data centers.

She also added, "If tech companies plan to get clean energy from the grid, they should make a contribution. There are currently many discussions between tech companies and utilities on this issue."

Multi-party agreement

With the increase of data centers, Google is also looking for a large amount of electricity to meet its huge power load and climate goals. The latest cooperation can be regarded as a response to the Biden government's request.

For some large tech companies, obtaining electricity in the power market is regulated. The power market requires these companies with huge power loads to purchase electricity from local utility companies rather than directly from power plants, which is a challenge for companies seeking clean energy.

Therefore, Google's latest power purchase agreement is a multi-party agreement involving NV Energy and energy supplier Fervo Energy.

According to Google's statement, Fervo Energy will develop a brand new geothermal power plant and provide up to 115 megawatts of power supply to NV Energy, which will then sell the power resources to Google.

At present, this multi-party agreement still needs formal approval from national regulatory agencies.

Google said that through the energy supply agreement reached with NV, Google has supported the expansion of the enhanced geothermal power generation capacity by nearly 25 times, bringing more clean energy to the local power grid serving Nevada data centers.

According to data from the U.S. Energy Information Administration (EIA), geothermal energy uses naturally occurring underground heat to produce renewable electricity, accounting for about 10% of Nevada's total electricity generation, the most among all states in the USA.