Here’s news we can all “like” today: Facebook announced plans last week to locate its newest data center in rural Nebraska. Thanks to a new renewable energy tariff provided by their future local utility, low-cost wind energy will power 100 percent of the facility.
A big footprint
This will be a big data center. Spread across a 146-acre campus and measuring 970,000 square feet, it will be Facebook’s sixth U.S. data center when it comes online in 2020.
But how will wind power this energy-hungry facility?
Facebook collaborated with its future local utility, Omaha Public Power District (OPPD), to design Rate261M, a renewable energy tariff that allows large energy customers like Facebook to directly source renewable energy and its associated renewable energy credits (REC) from specific wind projects in OPPD’s service territory.
We know that corporate purchasers continue to set ambitious targets to procure renewable energy, and that they choose wind power more than any other energy source. With the cost of wind falling by two-thirds over the last seven years, it’s the cheapest source of new electric generating capacity in many parts of the U.S., and cost-competitive in many more.
Put simply, wind energy helps their bottom lines.
How to make a wind-powered data center happen
Historically, corporate purchasers have chosen to sign physical or virtual power purchase agreements (PPA) with wind projects outside of their local utility.
That’s why partnerships like that between Facebook and OPPD are key for corporate purchasers moving forward. Renewable energy tariffs provide flexibility, and they allow corporate customers to directly procure renewable energy from their local utility.
Specifically, Rate 261M uses a custom electricity rate structure that incorporates pricing specific to individual wind projects – all while adding no cost to OPPD’s other customers.
OPPD CEO Tim Burke said it best: “By collaborating with one another and looking for solutions that serve the best interests of our entire community, we create tremendous value. It’s an example of how we work to meet the needs of large customers, particularly those who seek more renewable energy.”
Only a small handful of utilities, including OPPD, now offer renewable energy tariffs to their customers. NV Energy introduced the first green tariff back in 2013, only four years ago.
As of September 2016, only 10 green tariffs in eight states had been proposed or approved. Tuesday’s announcement was just the second where a green tariff has translated to wind energy procurement. The first came in 2016, when Facebook announced wind and solar would power 100 percent of the Los Lunas data center in New Mexico, thanks to the Green Energy Rider provided by the Public Service Company of New Mexico.
As we’ve seen in recent announcements from companies like 7-Eleven, Home Depot, and others, companies want wind energy and they want to procure it from their local grid, when they can. Renewable energy tariffs offer another way for these companies to power their operations with low-cost, reliable wind, and expanding these opportunities will play a key role in the future.