Microsoft and Bad Green Energy

The New York Times did a typical anti-corporate hit piece on Microsoft yesterday, implying that the tech giant is a polluter, wasted energy, and acted as an evil corporate thug against the will of rural America. Unwittingly, the Times actually exposed some of the core fallacies of the 'green' movement's shibboleths.

As do Google, Amazon, and many others, Microsoft bought some rural farmland to house the computers that power its online services such as Bing and HotMail. Microsoft chose Central Washington State because the area's hydroelectric generators allow Microsoft to achieve 'carbon neutrality,' a corporate goal. While most of the neighboring farmers probably appreciate the several orders of magnitude increase in land productivity, the increased tax base, and the new high-paying jobs, the Times of course found a few people who think progress should be completely free.

Frist, the Times framed Microsoft as big and mean, quoting a local who apparently did not know Bill Gates had stepped down as CEO six years before the plant was built. Naturally, someone then sued, claiming that the diesel powered backup generators would create pollution if operated. Probably at the heart of the discord is that Microsoft demanded cheap electricity and fair treatment from the local utility in exchange for locating in the middle of nowhere. Microsoft played hardball, wasting energy to force a renegotiation of a contract as well. More than showing how a handful of malcontents will fight investment, jobs, and progress, the Times article unwittingly exposes how the 'green' movement's assumptions are very flawed.

The Times omits that internet services might be the best 'green' technology ever. The internet allows billions of people to avoid shopping trips and sending physical letters. Online conferencing replaces millions of business trips, and millions of people can work from home rather than commuting to an office. Even poorly run, internet services are immeasurably beneficial to the cause of using less energy. The green movement is not particularly high on saving energy to save money, however. They prefer command and control reductions in quality of life.

Microsoft, along with other internet companies, has pledged to become 'carbon neutral,' which means that it will meet its considerable power needs through alternative energy and from ill-defined 'carbon credits.' This is why Microsoft and others have located their servers near dams with hydro-electric generators. Because the electrons are pumped through the wires by water powered turbines, Microsoft can claim they are emitting no carbon, but the argument falls flat. Before Microsoft built its data center, the electricity was already being used elsewhere; the river turbines were already producing as much power as they could. Therefore, someone somewhere else was taken off of hydro-power and put on a natural gas turbine. Microsoft can claim what it wants for PR purposes, but the marginal growth in total electricity usage is powered by fossil fuels, no matter where the facilities are located. Indeed, long power lines waste energy, so to be 'green' Microsoft should have built its plant next to a natural gas field and installed its own turbines on site (look for a follow-up comment on Shout Bits's idea for an efficient server facility).

A few locals also sued about Microsoft's installation of diesel backup generators. Since the power grid can fail for a number of reasons, and Microsoft must provide its services worldwide at all times, it needs a backup power source. The generators are meant to be used very rarely, so the complaint was baseless, but the need for a backup power source is at the heart of 'green' power's impracticality. While Microsoft cannot tolerate even a second of power loss, nobody else likes it either. Intermittent power losses would kill people at hospitals and cause chaos elsewhere. When the wind does not blow and clouds obscure the Sun, wind and PV solar electricity are worthless. Yet the lights stay on because gas turbines are spinning, ready to take on the load. Not only do these 'green' technologies cost several times more than gas, their hidden cost is that utilities must still install the same number of gas turbines as if wind farms did not exist. Further, the backup turbines have to idle at low power waiting for a drop in wind speed, which burns some gas and wears out the turbine. The only good thing about wind and PV solar electricity is that they are rarely used.

Microsoft also reportedly purposely wasted energy. To secure low cost electricity, Microsoft contracted for a minimum amount of power. The utility needed certainty that its investment in new equipment would be repaid, so Microsoft agreed to penalties if it did not consume enough power. Logically, the penalty should have been equal to the cost of the unused power, but apparently, it was cheaper for Microsoft to waste energy to avoid the penalty. Microsoft's tactic proves that all parties knew the real power was coming from natural gas because the utility renegotiated the penalty. If the power was really coming from hydro turbines, the utility would be very happy to let Microsoft waste energy, as the marginal cost of that electricity would be nearly zero. Natural gas, however, is not free, so the utility was losing money compared to a lowered penalty below the retail price of electricity.

The Times sought to portray another corporation as an evil bully, but the facts also show how corporations make harmful and illogical decisions in the name of 'greenness.' Most often, the economic business choice is also the choice that consumes the least resources, including fossil fuels.

Yea, I saw an article about this. MS got fined before for NOT using enough energy. This time they were below the threshold, and were going to get fined 210K!

So they burned up 70K of energy to avoid the fine.

So here’s the question I haven’t heard asked: if WA state is supposed to be so gung-ho on saving energy; why are they fining companies for not using enough energy?

Building a server facility on a farm just to claim it is powered by hydro-electric power is a bad idea. Most importantly, the hydro-power was already being used, so any new power will come from a natural gas turbine, no matter where the servers are located.
Power is lost in the delivery of electricity from the generator to the end user. When the electricity is initially generated, it is at a low voltage, which cannot be transported through wires to the end user. Instead, it is “stepped-up” to a much higher voltage, which travels better through wires to the end user. Once near the end user, the voltage is “stepped-down”, sent through neighborhoods, and then “stepped-down” again to the familiar 240V used by most homes. This process wastes about 40% of the original energy delivered by the generator, which directly correlates to carbon emissions. Computers require various low DC voltages, introducing further losses in their power supplies. While server facilities are more efficient, only about 40% of generated power reaches the typical home computer motherboard (60% loss).
Likewise, natural gas must be pumped from a field of wells to the power plant. That involves lots of steel pipe and some electricity.
Servers also generate a lot of heat, which must be dissipated through either air conditioning or water cooling towers. Northern climates, being cooler, would reduce this cost somewhat.
Therefore, the most energy efficient (and truly green) server facility solution would be:
• Located near a natural gas field with several decades of proven reserves, and in a northern climate zone.
• Have its own natural gas turbine generator, or perhaps a fuel cell if that technology evolves a bit more.
• Instead of stepping-up the voltage of the generator to 100,000 Volts or more, transform it to 25V, 12V, and 5V (or a bit higher to account for losses). Then send the power to a AC to DC converter that provides the required voltages to thousands of server computers.
Compared to a fake hydro-power solution that is really a standard gas turbine distribution network, this solution should consume about half the natural gas. The only drawback is that this solution cannot make the vague ‘carbon neutral’ claim. Companies should decide if they want to consume less fossil fuel or if they want to ‘green wash’ their image while really doing nothing.

I assume the utility is privately owned. They invested a lot of money in the form of feeder plant and, yes, gas turbines, to allow for Microsoft’s expansion.

They needed a guarantee MS would use enough electricity so that they would not have to stick the cost to other customers. I doubt the WA PUC knew too much about the penalties. I have personally dealt with them, and they are not too bright.

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