Home Back Issues August 2009 Cheap hydro dries up

Cheap hydro dries up

| Print |  Email
Archives - August 2009
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

Semiconductor purgatory

News
Monday, October 06, 2014
roundup-logo-thumb-14BY LINDA BAKER | OB EDITOR

Intel's manufacturing way station; Merkley's attack dog; Diamond Foods gets into the innovation business.


Read more...

Innovation: a critique

News
Wednesday, October 08, 2014
1008 innovation thumbBY LINDA BAKER | OB EDITOR

A Design Week panel discussion raises questions about how innovative we really are.


Read more...

OB Poll: Wineries and groceries

News
Friday, October 24, 2014

24-winethumbA majority of respondents agreed: Local vineyards should remain Oregon-owned and quality is the most important factor when determining where to eat or buy groceries.


Read more...

100 Best Nonprofits to Work for in Oregon [VIDEO]

News
Thursday, October 02, 2014

Screen shot 2014-10-02 at 11.17.21 AMMore than 5,500 employees from 180 organizations throughout the state participated in the 100 Best Nonprofits to Work for in Oregon project.


Read more...

I Know How You Feel

November/December 2014
Wednesday, October 22, 2014
BY JESSICA RIDGWAY

Most smartphones come equipped with speech recognition systems like Siri or Cortana that are capable of understanding the human voice and putting words into actions. But what if smartphones could do more? What if smartphones could register feeling?


Read more...

The 100 Best Companies survey is open

News
Friday, October 24, 2014

100-best-logo-2015 500pxw-1How does your workplace stack up against competitors? How can you improve workplace practices to help recruit and retain employees? Find out by taking our 100 Best Companies to Work for in Oregon survey!


Read more...

October surprise

News
Sunday, October 12, 2014
roundup-logo-thumb-14BY LINDA BAKER

Cylvia Hayes, tabloid vs. watchdog journalism and the looming threat of a Cascadia earthquake.


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