In another sign that Google (NASDAQ: GOOG) wants to be in businesses well beyond its key search operations, the company has announced another initiative. It is not a phone, or even bidding on wireless spectrum
Google is going into the renewable energy business. The company announced "a new strategic initiative to develop electricity from renewable energy sources that will be cheaper than electricity produced from coal."
Weird? Or, cool? According to Google, in 2008 Google expects to spend tens of millions on research and development and related investments in renewable energy. As part of its capital planning process, the company also anticipates investing hundreds of millions of dollars in breakthrough renewable energy projects that generate positive returns.
Google does use a lot of electricity to run its server farms, but enough to justify the huge investment in technology that may not work? It's probably a bad idea.
Part of the concern about the current Google share price is that, as the company evolves beyond its core skills, returns to shareholders could drop. Renewable energy falls into that category.
Douglas A. McIntyre is an editor at 247wallst.com.











Reader Comments (Page 1 of 1)
11-27-2007 @ 1:42PM
nelson valdes jr said...
If anyone at Google wants to become involved with a technology which has the capabilities of converting many forms of different materials into Renewable energy and has invested over 14 million of its own capital and resources in Research and development, please respond to this e-mail.
11-27-2007 @ 1:23PM
ET Snyder said...
With Peak Oil at our doorstep (perhaps even on yesterday's stoop), and the potential threats of climate change looming on the horizon, investment in RE technologies is absolutely essential to the future of our society, if we wish to continue developing and utilizing technology.
Unfortunately, the United States has been painfully lethargic in developing any substantial RE infrastructure, and is significantly lagging behind many other industrialized nations. Until recently, we have lacked initiative, funding, political and public support.
With the aid of such a powerful organization as Google, RE technology in the United States (and elsewhere) could very well get the push that it needs. This is by no means an unsound investment on Google's part, as fossil-fuel generated energy will only continue to escalate in cost, public opposition, and negative environmental impact as time progresses. The technologies necessary to generate energy cleanly and efficiently exist already, and simply need financial support and shear will.
For this, I strongly applaud Google's new program, and see it as possibly one of the best investments that organization could make at this time. As an advocate of RE technology, I'm also extremely excited about the potential benefit Google could provide to the field.
To anyone who uses electricty on a daily basis, and is even vaguely aware of environmental and energy issues, this is an extremely important field. Google are merely using their power of foresight, yet again...
11-27-2007 @ 1:33PM
Sheldon L said...
This is a dumb idea unless they have PhD's who's expertise they expect transfers effortlessly from software and electronics to energy.
These would be new hires and they would be competing in an environment where they have no competitive advantage or skill sets. Great intentions do not automatically translate into great results.
They would be better off taking some of their Venture Capital and funding some promissing small start-ups.
11-27-2007 @ 2:46PM
ET Snyder said...
"They would be better off taking some of their Venture Capital and funding some promissing small start-ups."
Sheldon, if you read Google's official announcement page for this project, it's evident that outside investment in promising start-ups is a significant component: http://www.google.com/intl/en/press/pressrel/20071127_green.html
"These would be new hires and they would be competing in an environment where they have no competitive advantage or skill sets. Great intentions do not automatically translate into great results."
It is extremely likely that Google will be hiring individuals for this program that have significant background experience and expertise. The competative advantage would lie in Google's significant financial assets, organizational ability, and cultural/financial/political influence.
11-28-2007 @ 10:31AM
Aung Kyaw said...
WAY TO GO GOOGLE!!!
NOTHING IS CERTAIN IN LIFE SAVE DEATH AND TAXES.
NOTHING VENTURED NOTHING GAINED!!!
AMERICA NEEDS MORE PEOPLE LIKE YOU WILLING TO INVEST IN THE FUTURE FOR ALL MANKIND.