Sponsored by Oregon Business

Cheap hydro dries up

| Print |  Email
Thursday, July 23, 2009

The days of the Googles and Amazons of the world rushing to The Dalles and Boardman to cash in on cheap federal hydropower for secretive new server farms are officially over.

As part of an exhaustive process to negotiate new 20-year contracts with its key electricity customers, the Bonneville Power Administration has closed the loophole that convinced Google, Amazon, Microsoft and Yahoo to build high-energy data centers jam-packed with servers and powered by subsidized Columbia River hydropower.

Previously these companies were allowed to partner with local governments and public utility districts (PUDs) to negotiate bargain-basement power rates with the BPA of around 2.5 cents per kilowatt-hour in exchange for new jobs and guaranteed power purchases. But under the new rules, any new user of electricity will have to pay a fair market price rather than the historically low wholesale rate paid to PUDs.

“We are going to serve at the historic low rate for the current load, but for load growth, they will pay for the cost of the added supply,” says BPA administrator Stephen Wright. “The load server farms that got in before now, good for them. From this point forward, everyone is going to see basically the same price.”

The new policy will not sour the sweetheart deals that are already in place for Google in The Dalles or Amazon in Boardman. Nor will it slow the demand for new server farms to support the cloud computing boom. It just moves them out of the region. In July Microsoft opened new data centers in Ireland and Chicago, and Apple recently announced that it will invest more than a billion dollars in a data center in North Carolina.

BEN JACKLET
 

Comments   

 
thinking forward
0 #1 thinking forward 2009-08-05 14:43:50
Do you remember the FAKE Power Shortage that KILLED the Aluminum Plants? Here we go again!! Jobs Jobs we need Jobs!!!
Quote | Report to administrator
 
 
Ben J
0 #2 Ben J 2009-08-06 11:36:50
The subsidized power for the aluminum plants could not last forever. Neither could the cheap power for the server farms. Power costs are going up, not down. That will kill some jobs, while creating others.
Quote | Report to administrator
 

More Articles

Bike Chic: 7 stylish options for cyclists

April 2015
Thursday, March 26, 2015

Cycling to work is all the rage. But not everyone wants to arrive at the office messy, sweaty — and unfashionable.


Read more...

Cache and Curry

March 2015
Monday, February 23, 2015
BY JACOB PALMER | OB DIGITAL NEWS EDITOR

Power Lunch at Swagat in Hillsboro.


Read more...

6 highlights from the Craft Brewers Conference

The Latest
Friday, April 17, 2015
thumbPHOTOS BY  JASON E. KAPLAN

The 32nd annual CBC attracted a record number of attendees (11,000)  to the Oregon Convention Center.


Read more...

Photos from the 100 Best Companies to Work For in Oregon awards celebration

The Latest
Friday, February 27, 2015
IMG 9975cneditPHOTOS BY JASON E. KAPLAN

Images from the 2015 celebration of Oregon's great workplaces.


Read more...

Help Wanted: Poached Jobs aids restaurateurs

March 2015
Friday, February 20, 2015
BY JACOB PALMER | OB DIGITAL NEWS EDITOR

“We thought there was room for something new.”


Read more...

5 questions for inDinero CEO Jessica Mah

The Latest
Tuesday, March 31, 2015
jessicathumbBY JACOB PALMER | DIGITAL NEWS EDITOR

inDinero, a business that manages back-office accounting for startups and smaller companies, recently announced it would relocate its headquarters from San Francisco to Portland. We talked to CEO Jessica Mah about what drew her to Portland and how she plans to disrupt the traditional CPA model.


Read more...

Can small be large?

Linda Baker
Wednesday, April 01, 2015
040115-lindablogthumbBY LINDA BAKER

Leaders in Oregon's ag sector gathered this morning in Portland’s Coopers Hall winery/taproom to discuss the role of the region as an export gateway, impediments to exporting products and solutions to containerized shipping challenges.


Read more...
Oregon Business magazinetitle-sponsored-links-02
SPONSORED LINKS