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Amazon on the Columbia

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Monday, December 01, 2008

BOARDMAN Amazon.com is coming to the Port of Morrow. Sort of.

More accurately, Amazon.com is preparing to move a mountain of servers next to the Columbia River to take advantage of the same low hydropower rates that have enticed Microsoft, Yahoo and Google to do likewise. The more powerful the leading Internet companies become, the more power they require, and their power source of choice is the Columbia, with bargain wholesale rates of 2.5 cents per kilowatt-hour.

Exactly how much electricity will go to Amazon remains a mystery. The public agencies that negotiated the deal signed a nondisclosure pact with the bookselling behemoth. But you can bet it will be no small amount, somewhere between 20 and 100 megawatts depending on who is guessing.

In a remote location like Boardman, trading cheap power for new jobs and property taxes is a no-brainer. But the door will be closing soon. The public utilities that buy power from Bonneville Power Administration will no longer be permitted to add significant new wholesale power users starting in 2012. That explains the rush by Amazon and Google to get it while they can. The Umatilla Electric Cooperative sells power to the Port of Morrow at some of the nation’s lowest rates.

Each new data center contains thousands of servers, miles of underground conduit and millions of dollars worth of copper wiring. Very futuristic, but in a way it’s nothing new. Since World War II aluminum companies have sapped the Columbia for cheap power. At the height of the industry more than one-third of the BPA’s electricity went to aluminum companies.

That story ended badly. Aluminum companies started selling power for windfall profits on the open market rather than providing jobs. BPA pulled the plug on the bad actors in 2001, leaving behind company towns without companies.

Amazon and Google provide fewer local jobs than aluminum companies. But they do know a thing or two about innovation.

“The problem with most of the aluminum companies is that they were always short-term thinkers,” says Steve Weiss, a senior policy associate for the Northwest Energy Coalition. “These new players like Google and Amazon definitely have long-term vision. They may end up developing into interesting new partners.”

BEN JACKLET


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