Companies like Google, Amazon, Microsoft, and Meta are now some of the country's largest consumers of electric power. And as Bloomberg Law's Daniel Moore reports, they're starting to wield their strong purchasing power.
Big Tech companies are pushing the energy industry to bring more renewable power projects online, Moore says, and they're also hiring energy lobbyists to achieve these goals in Washington.
Moore joins our environmental policy podcast, Parts Per Billion, to talk about where the tech industry wants the country's electric grid to go and what that means for both utilities and ratepayers.
Do you have feedback on this episode of Parts Per Billion? Give us a call and leave a voicemail at 703-341-3690.
It takes a lot of electricity to run the Internet. Where's that electricity coming from? Today we're talking about how big tech is starting to throw its weight around in the energy industry and what that means for you, me and for your utilities. Hello and welcome back once again to Parts per Billion, the environmental podcast from Bloomberg Law. I'm your host, David Schultz. So here's something I learned working on today's podcast. Big companies get their electricity in a totally different way than you or I do. That makes sense. Of course, buying something wholesale is always going to be different than buying a retail and sometimes if you're a big enough wholesale buyer, you can have a lot of influence over where your power comes from and how it's generated. None of this is new, But what is new is that some of the biggest wholesale power buyers are now tech companies, thank Google, Microsoft, Apple. They're not only influencing where their electricity comes from, they're also influencing the folks hearing Washington, d C. Who regulate the energy industry. That's the topic of the latest story from Bloomberg Law. Reporter Daniel Moore and I brought them on today to talk about what it means that big tech is becoming a big player here. But first I asked them to explain to me how it works when you buy your power wholesale. Yeah, it's a little bit more complicated than maybe just flipping on the light switch and signing up for utility power like you or I will do for our homes. UM big companies like data centers, schools, hospitals, big office buildings, they consume a lot of energy. They want the lowest rates possible, and they want reliable energy too. If they lose power for an hour, even a few minutes, it can be devastating. And so what a lot of those companies do is reach out and try to secure the supply of energy from the from the source, from the generating plant. And so sometimes they're working with UM utilities to do that through teariff programs. Sometimes they're going directly to a developer to do that. And so it's a little bit more complicated than just you know, a residential customer. You say, tear of programs. Is that like you know, when I think of tariffs, I think of you know, taxes on imports and exports and stuff. What's the terrors and energy tariff. A tariff um would be a state approved rate essentially, so you know we pay tariffs center electric bills every month, but this would be kind of a special tariff for a specific customer. I see. So it's a it's a power industry term of art. It is. Yes. So one of the things that your stories was about were these big tech companies and how you know they are using more and more power and trying to source it responsibly. I guess I was just absolutely astonished by some of the figures in your story. Can you give me a sense of just how much power like Google and Microsoft and and Meta are using. Yeah, these companies are running huge data centers that basically run the Internet in a lot of ways. If you go on Amazon to buy something, I mean, that's all coming from a source of energy. And so I pulled out Google statistic which is eighteen point three tarra lott hours of electricity in and that's more than double from four years prior. So the growth is tremendous. And what that represents is about one point seven million average US households um that amount of electricity over a year. And I think, what blew my mind? Is what you just said that within a four year period that more than doubled like that. If you plot that on a chart, that's scary. Yeah. And it's the growth that's kind of astonishing. I mean, it makes sense that these companies use a lot of energy, but it's the growth over a very short period of time and that kind of gets out some of the challenges with the power grid that we're talking about here. Right, So, these big companies and these big tech companies are sourcing their power wholesale, and it sounds like the tech companies in particular really want to get their power from renewable sources. Why is that? Is it just because they you know, I love the environment, and they're very altruistic and they you know, have, um, you know, nothing but the best of intentions, as you cannot being a little facetious here, or are there other reasons why they are interested in in getting exclusively renewable power. Yeah, there's more going on here. Um. It's kind of interesting because it reflects I think the clean energy transition as a whole. Wind and solar are both very cheap now, the costs of fallen, and so companies that consume large amounts of energy. They want to be seen as green companies, as environmentally sensitive, as improving air quality in the communities where they're putting data centers, but now they can do so profitably. It's kind of a you know, a happy situation for the companies where you know, clean power is cheap power now, so and that's happened broadly across the economy, and this is just one big consuming sector right now, right, so it helps their brand. It helps their brand to be seen as a green company. But also, as you point out in your story, a lot of these companies made environmental pledges and emissions pledges that they are now kind of struggling to keep. And you know, it sounds like by sourcing their power directly from renewable sources, this is a way to help them keep their promises. Yeah, yeah, definitely, And I think they're looking for new ways to get that power and that gets that some of the grid policies as well that they're pushing. And you know, over in recent years they have increasingly been trying to press for more renewable energy as they have had these at zero goals because you know, there's only a finite amount of wind and solar, right now, and they're trying to get involved in the business of building more of that by demanding more of it, right, and not just building or you know, building more of it, but encouraging more to get built and also encouraging policies to change to allow more renewable energy to get built. And that was another thing you reported that these a lot of these tech companies are hiring energy lobbyists since specifically clean energy lobbyists. Who are they hiring and what exactly are they lobbying on. Yeah, they've been hiring people who have spent years in the energy industry, specifically in the electricity sector, who are super familiar with agencies like the Federal Energy Regulatory Commission, for which has been embarking on, you know, multiple rulemakings over the last year involving transmission lines and generator interconnection and things that used to be things that are very wonky and used to be just the venues of utility experts. And so they're hiring people from trade associations, from the hill, people who have for experience, and they've been stuffing up you know, I've heard over the last year or two. I mean, this has been a pretty recent development that they've been trying to you know, bring on expertise in order to effectively lobby in d C. Right. I mean, well, you you said in your story that they were hiring you know, people with pretty impressive resumes or at least very connect and resumes. You know, ex Hill staffers, former administration officials. You know, these are people who know how the game is played here in d C. Yeah, and they've been you know, a regular presence at panels, um and and different conferences. And I mean I got the idea to report this story about a year ago, and over the last year I've seen you know, companies like Google sponsor these events. I've seen representatives from Microsoft, Meta, Amazon sit on panels and talk about you know, policies that used to be UM again pretty pretty exclusive to utility nerds and in former for lawyers and you know, people who are really embedded in the world of you know, you know, generating and transporting and delivering power. So as an aside here just f one journalist to another, that's a really cool way to come up with the story. Idea is that you know, we all go to these conferences where you know, people are speaking and these industry conference is but you were noticing that different people were showing up to the conferences than you would expect, and that in itself is the story. Yeah, and you know there are there have been trade associations too that have been established and founded by you know, these big tech companies. Specifically, the Clean Energy Buyers Association UM is a good example where they represent as as the name suggests, companies, big corporations that want to buy clean energy. But they're based in d C. They're doing a lot of lobbying around grid policy and transmission lines and all these things and so UM. But the you know, the the impetus for finding for founding that group was to influence grid policy and DC so that companies can buy more you know, winded solar. Okay, so let's now take a step back and sort of look at this from the big picture. Let's say you're an environmental activist, You're someone who's really concerned about climate change or um or air emissions. On the face, this would seem like a positive development that you now have very very wealthy UM stakeholders who are advocating for clean energy. However, it's just it feels odd to me for you know, grassroots environmental activists to be cheering corporate lobbying like it sounds very strange. Is this something that if you're an activist you're happy about or are you a little ambivalent? Yeah, I think by and large i've heard people are are cheering these companies on UM. It is a little bit strange, I think in some ways, just given they may not usually support big corporate law being in d C. But you know, I think I think they care about the outcomes, and I think it if companies like Google and Amazon can press for you know, connecting more renewal energy UM, they're actually signing up for, you know, these agreements that by all the power from a wind farmer, solar farm, and so if you're an environmental group and you care about the results and building these renewal energy plants UM, I've heard by and large they're they're supportive. I think the concern might be more from like a consumer advocate standpoint, where you know, what what is this doing to the system, What is this doing to rates? What may this do to reliability issues? I mean, that's kind of the concerns I hear from utilities that are going before state commissions and trying to justify their rates and trying to you know, they're the ones that are held accountable if the lights go off, and so I think there may be concerns on that side of it, um, but it seems like, you know, environmentalists by and large are aligned with the big tech companies. That's a great point, which is that you know, if if these companies are lobbying to get something done in Washington, that means there's someone else on the other side that is lobbying to not do that or to you know, do something different. And it sounds like the other the folks on the other side of this are the utilities who are, well, you know, what are they saying. What's their argument as for why they, you know, are maybe opposing or if not opposing, at least not going along with what the tech companies want. Yeah, utilities would say, we are trying to work with all largest customers. I mean, it's it's a tough situation because these are big customers. They're going to sell a lot of electricity to these customers. If you're a utility, this is revenue for you, I mean, this is this is a business opportunity. You want to supply as much power as you possibly can. But I think the problem comes in if you have a company pressing for clean power, perhaps that's not the cheapest power on your system. Perhaps that will create, you know, a rate increase for cost t mers. Perhaps perhaps that's just not doable and you know, while maintaining reliability. So maybe maybe it is doable, just not now. Maybe in five years. Yeah, maybe maybe it's more of a transition. I think that's you know, again, the broader debate over the clean energy transition is how long is that window going to take? You know, how long does it take to build a bunch of wind and solar plants if that's what we want? And so utilities, you know, it's it can be somewhat of a clash sometimes. I mean they certainly they want to control their system too. They want to be able to say, you know, we'll work with you on a tariff, but don't go around us and and get a contract with the wind solar farm. Uh. So there can be some tension there with utilities for sure. And you know, customers don't have to go before the state commission and justify their rates, and and they're not held accountable if the lights go off, So you know, everyone's kind of rolling in the same direction, but it's just you know how fast you're going? All right, that's like it sounds like a good place to end it. Um, let's leave it there and uh revisit this in the near future. This is a really interesting topic. That was Daniel Moore talking about big tech and renewable energy. Thanks for talking. Yeah, thanks for having me on. And that's it for today's episode of Parts for Billion. If you want more environmental news, visit our website news dot Bloomberg Law dot com. That website once again his news dot Bloomberg Law dot com. Today's episode of Parts for Billion is produced by myself, David Schultz. Partsber Billion was created by Jessica Combs and Rachel Dagle and is edited by Zack Sterterwood and Chuck McCutcheon. Our executive producer is Josh Block. Thanks everyone for listening. An individual's race should not be used to help him or harm him in his life's endeavors. A pair of lawsuits has made its way to the Supreme Court, and the decision could dramatically change just who gets into which college. Bloom is effectively using the Asian community as pawns every lawsuit needs a villain to mask and anti black of anti Latino agenda. Does this demoralize me? No, it doesn't demoralize me. This season on Uncommon Law will explore the arguments and the people driving this latest battle over affirmative action. Can the Constitution be used to remedy society's ills? I'm the only person in class, must raise my hand and say, okay, well, actually, here's how this affects people that look like me. Does the Fourteenth Amendments Equal Protection Clause prohibit all discrimination based on race? You let somebody in because of their race, you're keeping somebody else out because of their race. There might have been two or three Latinos, including me, and so somehow that's too much. Somehow that goes too far. It's hard not to take that very personally. Coming October, part one of a three part series on affirmative action. What's being decided is whether black and brown people are going to be excluded in significant numbers only. An uncommon Law from Bloomberg Industry Group