Speaker 1: It takes a lot of electricity to run the Internet.
Speaker 1: Where's that electricity coming from? Today we're talking about how
Speaker 1: big tech is starting to throw its weight around in
Speaker 1: the energy industry and what that means for you, me
Speaker 1: and for your utilities. Hello and welcome back once again
Speaker 1: to Parts per Billion, the environmental podcast from Bloomberg Law.
Speaker 1: I'm your host, David Schultz. So here's something I learned
Speaker 1: working on today's podcast. Big companies get their electricity in
Speaker 1: a totally different way than you or I do. That
Speaker 1: makes sense. Of course, buying something wholesale is always going
Speaker 1: to be different than buying a retail and sometimes if
Speaker 1: you're a big enough wholesale buyer, you can have a
Speaker 1: lot of influence over where your power comes from and
Speaker 1: how it's generated. None of this is new, But what
Speaker 1: is new is that some of the biggest wholesale power
Speaker 1: buyers are now tech companies, thank Google, Microsoft, Apple. They're
Speaker 1: not only influencing where their electricity comes from, they're also
Speaker 1: influencing the folks hearing Washington, d C. Who regulate the
Speaker 1: energy industry. That's the topic of the latest story from
Speaker 1: Bloomberg Law. Reporter Daniel Moore and I brought them on
Speaker 1: today to talk about what it means that big tech
Speaker 1: is becoming a big player here. But first I asked
Speaker 1: them to explain to me how it works when you
Speaker 1: buy your power wholesale. Yeah, it's a little bit more
Speaker 1: complicated than maybe just flipping on the light switch and
Speaker 1: signing up for utility power like you or I will
Speaker 1: do for our homes. UM big companies like data centers, schools, hospitals,
Speaker 1: big office buildings, they consume a lot of energy. They
Speaker 1: want the lowest rates possible, and they want reliable energy too.
Speaker 1: If they lose power for an hour, even a few minutes,
Speaker 1: it can be devastating. And so what a lot of
Speaker 1: those companies do is reach out and try to secure
Speaker 1: the supply of energy from the from the source, from
Speaker 1: the generating plant. And so sometimes they're working with UM
Speaker 1: utilities to do that through teariff programs. Sometimes they're going
Speaker 1: directly to a developer to do that. And so it's
Speaker 1: a little bit more complicated than just you know, a
Speaker 1: residential customer. You say, tear of programs. Is that like
Speaker 1: you know, when I think of tariffs, I think of
Speaker 1: you know, taxes on imports and exports and stuff. What's
Speaker 1: the terrors and energy tariff. A tariff um would be
Speaker 1: a state approved rate essentially, so you know we pay
Speaker 1: tariffs center electric bills every month, but this would be
Speaker 1: kind of a special tariff for a specific customer. I see.
Speaker 1: So it's a it's a power industry term of art.
Speaker 1: It is. Yes. So one of the things that your
Speaker 1: stories was about were these big tech companies and how
Speaker 1: you know they are using more and more power and
Speaker 1: trying to source it responsibly. I guess I was just
Speaker 1: absolutely astonished by some of the figures in your story.
Speaker 1: Can you give me a sense of just how much
Speaker 1: power like Google and Microsoft and and Meta are using. Yeah,
Speaker 1: these companies are running huge data centers that basically run
Speaker 1: the Internet in a lot of ways. If you go
Speaker 1: on Amazon to buy something, I mean, that's all coming
Speaker 1: from a source of energy. And so I pulled out
Speaker 1: Google statistic which is eighteen point three tarra lott hours
Speaker 1: of electricity in and that's more than double from four
Speaker 1: years prior. So the growth is tremendous. And what that
Speaker 1: represents is about one point seven million average US households
Speaker 1: um that amount of electricity over a year. And I think,
Speaker 1: what blew my mind? Is what you just said that
Speaker 1: within a four year period that more than doubled like that.
Speaker 1: If you plot that on a chart, that's scary. Yeah.
Speaker 1: And it's the growth that's kind of astonishing. I mean,
Speaker 1: it makes sense that these companies use a lot of energy,
Speaker 1: but it's the growth over a very short period of
Speaker 1: time and that kind of gets out some of the
Speaker 1: challenges with the power grid that we're talking about here. Right, So,
Speaker 1: these big companies and these big tech companies are sourcing
Speaker 1: their power wholesale, and it sounds like the tech companies
Speaker 1: in particular really want to get their power from renewable sources.
Speaker 1: Why is that? Is it just because they you know,
Speaker 1: I love the environment, and they're very altruistic and they
Speaker 1: you know, have, um, you know, nothing but the best
Speaker 1: of intentions, as you cannot being a little facetious here,
Speaker 1: or are there other reasons why they are interested in
Speaker 1: in getting exclusively renewable power. Yeah, there's more going on here. Um.
Speaker 1: It's kind of interesting because it reflects I think the
Speaker 1: clean energy transition as a whole. Wind and solar are
Speaker 1: both very cheap now, the costs of fallen, and so
Speaker 1: companies that consume large amounts of energy. They want to
Speaker 1: be seen as green companies, as environmentally sensitive, as improving
Speaker 1: air quality in the communities where they're putting data centers,
Speaker 1: but now they can do so profitably. It's kind of
Speaker 1: a you know, a happy situation for the companies where
Speaker 1: you know, clean power is cheap power now, so and
Speaker 1: that's happened broadly across the economy, and this is just
Speaker 1: one big consuming sector right now, right, so it helps
Speaker 1: their brand. It helps their brand to be seen as
Speaker 1: a green company. But also, as you point out in
Speaker 1: your story, a lot of these companies made environmental pledges
Speaker 1: and emissions pledges that they are now kind of struggling
Speaker 1: to keep. And you know, it sounds like by sourcing
Speaker 1: their power directly from renewable sources, this is a way
Speaker 1: to help them keep their promises. Yeah, yeah, definitely, And
Speaker 1: I think they're looking for new ways to get that
Speaker 1: power and that gets that some of the grid policies
Speaker 1: as well that they're pushing. And you know, over in
Speaker 1: recent years they have increasingly been trying to press for
Speaker 1: more renewable energy as they have had these at zero
Speaker 1: goals because you know, there's only a finite amount of
Speaker 1: wind and solar, right now, and they're trying to get
Speaker 1: involved in the business of building more of that by
Speaker 1: demanding more of it, right, and not just building or
Speaker 1: you know, building more of it, but encouraging more to
Speaker 1: get built and also encouraging policies to change to allow
Speaker 1: more renewable energy to get built. And that was another
Speaker 1: thing you reported that these a lot of these tech
Speaker 1: companies are hiring energy lobbyists since specifically clean energy lobbyists.
Speaker 1: Who are they hiring and what exactly are they lobbying on. Yeah,
Speaker 1: they've been hiring people who have spent years in the
Speaker 1: energy industry, specifically in the electricity sector, who are super
Speaker 1: familiar with agencies like the Federal Energy Regulatory Commission, for
Speaker 1: which has been embarking on, you know, multiple rulemakings over
Speaker 1: the last year involving transmission lines and generator interconnection and
Speaker 1: things that used to be things that are very wonky
Speaker 1: and used to be just the venues of utility experts.
Speaker 1: And so they're hiring people from trade associations, from the hill,
Speaker 1: people who have for experience, and they've been stuffing up
Speaker 1: you know, I've heard over the last year or two.
Speaker 1: I mean, this has been a pretty recent development that
Speaker 1: they've been trying to you know, bring on expertise in
Speaker 1: order to effectively lobby in d C. Right. I mean, well,
Speaker 1: you you said in your story that they were hiring
Speaker 1: you know, people with pretty impressive resumes or at least
Speaker 1: very connect and resumes. You know, ex Hill staffers, former
Speaker 1: administration officials. You know, these are people who know how
Speaker 1: the game is played here in d C. Yeah, and
Speaker 1: they've been you know, a regular presence at panels, um
Speaker 1: and and different conferences. And I mean I got the
Speaker 1: idea to report this story about a year ago, and
Speaker 1: over the last year I've seen you know, companies like
Speaker 1: Google sponsor these events. I've seen representatives from Microsoft, Meta,
Speaker 1: Amazon sit on panels and talk about you know, policies
Speaker 1: that used to be UM again pretty pretty exclusive to
Speaker 1: utility nerds and in former for lawyers and you know,
Speaker 1: people who are really embedded in the world of you know,
Speaker 1: you know, generating and transporting and delivering power. So as
Speaker 1: an aside here just f one journalist to another, that's
Speaker 1: a really cool way to come up with the story.
Speaker 1: Idea is that you know, we all go to these
Speaker 1: conferences where you know, people are speaking and these industry
Speaker 1: conference is but you were noticing that different people were
Speaker 1: showing up to the conferences than you would expect, and
Speaker 1: that in itself is the story. Yeah, and you know
Speaker 1: there are there have been trade associations too that have
Speaker 1: been established and founded by you know, these big tech companies. Specifically,
Speaker 1: the Clean Energy Buyers Association UM is a good example
Speaker 1: where they represent as as the name suggests, companies, big
Speaker 1: corporations that want to buy clean energy. But they're based
Speaker 1: in d C. They're doing a lot of lobbying around
Speaker 1: grid policy and transmission lines and all these things and
Speaker 1: so UM. But the you know, the the impetus for
Speaker 1: finding for founding that group was to influence grid policy
Speaker 1: and DC so that companies can buy more you know,
Speaker 1: winded solar. Okay, so let's now take a step back
Speaker 1: and sort of look at this from the big picture.
Speaker 1: Let's say you're an environmental activist, You're someone who's really
Speaker 1: concerned about climate change or um or air emissions. On
Speaker 1: the face, this would seem like a positive development that
Speaker 1: you now have very very wealthy UM stakeholders who are
Speaker 1: advocating for clean energy. However, it's just it feels odd
Speaker 1: to me for you know, grassroots environmental activists to be
Speaker 1: cheering corporate lobbying like it sounds very strange. Is this
Speaker 1: something that if you're an activist you're happy about or
Speaker 1: are you a little ambivalent? Yeah, I think by and
Speaker 1: large i've heard people are are cheering these companies on UM.
Speaker 1: It is a little bit strange, I think in some ways,
Speaker 1: just given they may not usually support big corporate law
Speaker 1: being in d C. But you know, I think I
Speaker 1: think they care about the outcomes, and I think it
Speaker 1: if companies like Google and Amazon can press for you know,
Speaker 1: connecting more renewal energy UM, they're actually signing up for,
Speaker 1: you know, these agreements that by all the power from
Speaker 1: a wind farmer, solar farm, and so if you're an
Speaker 1: environmental group and you care about the results and building
Speaker 1: these renewal energy plants UM, I've heard by and large
Speaker 1: they're they're supportive. I think the concern might be more
Speaker 1: from like a consumer advocate standpoint, where you know, what
Speaker 1: what is this doing to the system, What is this
Speaker 1: doing to rates? What may this do to reliability issues?
Speaker 1: I mean, that's kind of the concerns I hear from
Speaker 1: utilities that are going before state commissions and trying to
Speaker 1: justify their rates and trying to you know, they're the
Speaker 1: ones that are held accountable if the lights go off,
Speaker 1: and so I think there may be concerns on that
Speaker 1: side of it, um, but it seems like, you know,
Speaker 1: environmentalists by and large are aligned with the big tech companies.
Speaker 1: That's a great point, which is that you know, if
Speaker 1: if these companies are lobbying to get something done in Washington,
Speaker 1: that means there's someone else on the other side that
Speaker 1: is lobbying to not do that or to you know,
Speaker 1: do something different. And it sounds like the other the
Speaker 1: folks on the other side of this are the utilities
Speaker 1: who are, well, you know, what are they saying. What's
Speaker 1: their argument as for why they, you know, are maybe
Speaker 1: opposing or if not opposing, at least not going along
Speaker 1: with what the tech companies want. Yeah, utilities would say,
Speaker 1: we are trying to work with all largest customers. I mean,
Speaker 1: it's it's a tough situation because these are big customers.
Speaker 1: They're going to sell a lot of electricity to these customers.
Speaker 1: If you're a utility, this is revenue for you, I mean,
Speaker 1: this is this is a business opportunity. You want to
Speaker 1: supply as much power as you possibly can. But I
Speaker 1: think the problem comes in if you have a company
Speaker 1: pressing for clean power, perhaps that's not the cheapest power
Speaker 1: on your system. Perhaps that will create, you know, a
Speaker 1: rate increase for cost t mers. Perhaps perhaps that's just
Speaker 1: not doable and you know, while maintaining reliability. So maybe
Speaker 1: maybe it is doable, just not now. Maybe in five years. Yeah,
Speaker 1: maybe maybe it's more of a transition. I think that's
Speaker 1: you know, again, the broader debate over the clean energy
Speaker 1: transition is how long is that window going to take?
Speaker 1: You know, how long does it take to build a
Speaker 1: bunch of wind and solar plants if that's what we want?
Speaker 1: And so utilities, you know, it's it can be somewhat
Speaker 1: of a clash sometimes. I mean they certainly they want
Speaker 1: to control their system too. They want to be able
Speaker 1: to say, you know, we'll work with you on a tariff,
Speaker 1: but don't go around us and and get a contract
Speaker 1: with the wind solar farm. Uh. So there can be
Speaker 1: some tension there with utilities for sure. And you know,
Speaker 1: customers don't have to go before the state commission and
Speaker 1: justify their rates, and and they're not held accountable if
Speaker 1: the lights go off, So you know, everyone's kind of
Speaker 1: rolling in the same direction, but it's just you know
Speaker 1: how fast you're going? All right, that's like it sounds
Speaker 1: like a good place to end it. Um, let's leave
Speaker 1: it there and uh revisit this in the near future.
Speaker 1: This is a really interesting topic. That was Daniel Moore
Speaker 1: talking about big tech and renewable energy. Thanks for talking. Yeah,
Speaker 1: thanks for having me on. And that's it for today's
Speaker 1: episode of Parts for Billion. If you want more environmental news,
Speaker 1: visit our website news dot Bloomberg Law dot com. That
Speaker 1: website once again his news dot Bloomberg Law dot com.
Speaker 1: Today's episode of Parts for Billion is produced by myself,
Speaker 1: David Schultz. Partsber Billion was created by Jessica Combs and
Speaker 1: Rachel Dagle and is edited by Zack Sterterwood and Chuck McCutcheon.
Speaker 1: Our executive producer is Josh Block. Thanks everyone for listening.
Speaker 1: An individual's race should not be used to help him
Speaker 1: or harm him in his life's endeavors. A pair of
Speaker 1: lawsuits has made its way to the Supreme Court, and
Speaker 1: the decision could dramatically change just who gets into which college.
Speaker 1: Bloom is effectively using the Asian community as pawns every
Speaker 1: lawsuit needs a villain to mask and anti black of
Speaker 1: anti Latino agenda. Does this demoralize me? No, it doesn't
Speaker 1: demoralize me. This season on Uncommon Law will explore the
Speaker 1: arguments and the people driving this latest battle over affirmative action.
Speaker 1: Can the Constitution be used to remedy society's ills? I'm
Speaker 1: the only person in class, must raise my hand and say, okay, well, actually,
Speaker 1: here's how this affects people that look like me. Does
Speaker 1: the Fourteenth Amendments Equal Protection Clause prohibit all discrimination based
Speaker 1: on race? You let somebody in because of their race,
Speaker 1: you're keeping somebody else out because of their race. There
Speaker 1: might have been two or three Latinos, including me, and
Speaker 1: so somehow that's too much. Somehow that goes too far.
Speaker 1: It's hard not to take that very personally. Coming October,
Speaker 1: part one of a three part series on affirmative action.
Speaker 1: What's being decided is whether black and brown people are
Speaker 1: going to be excluded in significant numbers only. An uncommon
Speaker 1: Law from Bloomberg Industry Group