Welcome to the biz, Google!

Google is getting into energy. After a second of reservation (the industries are completely different) it makes perfect sense.

Google needs to cool hundreds of thousands of servers. To do all this cooling, and "do no evil" at the same time, they choose to use as much renewable energy as possible. They located server farms in the hydro-laden northwest, and are apparently looking at wind-abundant Iowa. They've also put a bunch of solar panels on their Mountain View office, and who knows what other green initiatives they've been involved with (Burning Man/Green Man?).

Like many other silicon valley veterans, Googlers are looking to this hot new sector and thinking to themselves - we can do this too. Heck, the company that put the solar panels on their Mountain View office is backed by none other than veteran dot-commer and solar geek Bill Gross. Turns out that as an undergrad at Michigan, Larry Page was part of the solar car team (per wiki), and Larry and Sergey are investors in Tesla motors (see blog).

I'm totally behind Google's decision to get into the sector, but I do so with lots of caution. The energy biz aint the internet. Growth in search is about great technology, followed by lots of eyeballs. Growth in the power/renewables in general, is very lumpy. Technology is just one component. Fuel prices are unpredictable, utilities don't always behave rationally, with generation comes sticky transmission issues; there is a shortage of power industry expertise (not that you can't attract the best with all that free food); and the supply chain means buying real stuff - like silicon and turbine blades - that are neither cheap nor plentiful these days. Most of all, the entire industry is driven by state and federal legislation and notoriously unreliable incentives. The renewable energy business, especially solar and wind, seems to be 80% regulation, 20% perspiration. Then there is the whole working with electric utilities thing. How's that been for you?

Skepticism aside, GOOG has tons of money, and some rather influential backers. Should be a fun ride.