The chief executive of Google and its parent company Alphabet has made it his mission to tackle climate change. Sundar Pichai has spoken about queuing for water due to droughts as a boy in India, and waking up to “orange skies and smoke from wildfires” as an adult in California.
“It was another reminder of how climate change is impacting so many of our communities,” the 49-year-old said in October.
The $1.5 trillion [£1.2 trillion] market cap tech giant has gone a long way in cleaning up its own operations, claiming to be the first major company to be offsetting all its emissions.
It plans to go further still, committing to using only “carbon-free” energy by 2030, including for its power-hungry data centres. But Google has also been pushing deeper into the energy sector beyond its own needs, using its expertise in data and computing to help manage parts of an increasingly complex energy system in the shift to cleaner power.
It’s a step that opens markets for the tech giant as the world starts to turn away from fossil fuels, but also brings questions for households as to the way they are sold and consume energy.
Google set the stage for a greater role in the energy system in 2014, when it paid $3.2bn for the thermostat and smoke detector maker Nest, as part of a push into the market for home technology shared by rivals.
Nest has for years run a programme in which households can opt to get paid for setting their thermostat to cut energy use during peak times, helping to lower the strain on the electricity system and therefore its costs.
Google is trialling a programme in the United States which takes that a step further. Under Nest Renew, households’ air conditioning or electric heating can be set to automatically prioritise running when power is cheaper and cleaner, working with the Nest thermostat within customer settings.
Google does not split out the size of its Nest division or its services, which are reported as part of its $28bn “Google other” division. The size of the opportunity is clear, however.
Grid operators around the world are eyeing energy shifting services, known as “demand-side response”, to help them cope with the shift away from fossil fuels.
Demand for electricity is set to soar as electric cars and electric heat pumps take over from gas-fired boilers and petrol cars. But supply of electricity is also set to become more intermittent, as wind and solar farms replace gas and coal plants. Balancing supply and demand is therefore getting trickier.
Encouraging households to soak up supply when it is, for example, very windy, and use less when it is still, can help. Similar sorts of schemes are being trialled by others in the UK.
“The challenge of transforming our ageing grid from a centralised, fossil-based system to the carbon-free grid of the future will require innovations beyond large-scale, carbon-free energy technology, particularly in demand-side management,” a Google spokesman said.
“With Nest Renew, we are taking the next step toward simplifying energy management at home, putting new tools for supporting clean energy front and centre.” Google works with utilities rather than replacing them, the spokesman adds.
In a study funded by Google last year, the RMI environmental think tank in the US found that if used by 10m households, a service like Google’s Nest Renew could cut carbon dioxide emissions by about 50m tons per year.
“Policymakers, regulators, and utilities who shape the markets in which they operate must act, quickly and in coordination, to break down barriers to adoption for all households,” it added.
Supporters of such programmes insist that consumers benefit as the overall electricity system is cheaper to run, while they also get access to cheaper energy.
Critics raise concerns, however, about whether they threaten households’ control over their energy use. Consumers could also be exposed to swings in energy wholesale costs via so-called time-of-use tariffs, which vary according to demand on the grid. Tech giants’ presence in this market could also heighten privacy concerns.
Lauren Shwisberg, co-author of the RMI study, notes households are able to override any automatic settings. “We’ve had a lot of extreme weather events in the US [where electricity systems have struggled to cope] highlighting the value of shifting energy and the opportunity for solutions like this to step in and provide cost savings and reliability,” she adds.
Google’s growing role in home energy management comes as it is also stepping in further on the supply side. This month the company announced a deal with French wind developer Engie to help maximise Engie’s electricity sales through better forecasting tools.
Google will help Engie predict how much power it is going to generate each day and how much the grid needs, helping it better manage its trading and thereby allowing electricity grids to balance up the system more smoothly.
They are currently focused on the German market, but Larry Cochrane, director of Global Energy Solutions at Google Cloud, says it will later look at expanding to other marketplaces.
Given the vast growth expected in wind and solar energy, “tools to be able to assist producers in trading will be really quite important, and accuracy becomes more and more important,” he told The Sunday Telegraph.
Google said it doesn’t “currently have plans” to one day match up data from the supply side with data about people’s energy consumption. But for a company not used to standing still, a greater role in the energy sector beckons.
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