How wind energy helped Iowa attract Facebook’s new data center

Source: by Dan Haugen, Midwest Energy News • Posted: Wednesday, April 24, 2013

After 18 months of courtship and competition, Iowa officials announced Tuesday that Facebook has selected a Des Moines suburb as the site for its next data center.

The social media giant plans to break ground this summer in Altoona, Iowa, on a $300 million data center that could be the first of three facilities there.

Much of the news coverage has focused on the $18 million in tax credits awarded by the state, but Facebook had another reason to “like” Iowa: wind power.

Committed to green power

Technology companies that operate large data centers have been under increasing pressure in recent years to reduce their energy consumption and carbon footprints.

As part of a December 2011 truce with Greenpeace, Facebook adopted a policy that gives preference to building data center in places with access to clean and renewable energy.

A company spokesperson confirmed in an email to Midwest Energy News that access to wind power was a factor in its decision to locate in Iowa.

“We are committed to powering more of our operations with renewables — we’ve set a goal of reaching 25% renewables in our mix by 2015 — and are exploring opportunities in all of the regions we operate data centers,” Alex Hollander wrote.

The availability of wind power is one of the reasons Iowa is now neck-and-neck with the state of Washington as a destination for large data centers, said John Boyd Jr., a New Jersey consultant who helps companies site data centers.

“Our clients are coveting green power,” Boyd said, and the demand is being driven by marketing. “There’s public relations value above and beyond the economic value of wind energy.”

Still, he doesn’t think it’s a leading criteria for siting decisions, he said. More important factors include tax incentives, real estate costs, and electricity prices.

Nebraska, a state with much less wind generation but also low electricity rates, was considered Iowa’s chief competitor for the site.

‘Unfriending’ coal

Facebook began feeling public relations pressure from Greenpeace in 2010, when the environmental group launched its Unfriend Coal campaign, urging Facebook to power its data centers with renewable energy.

The campaign culminated with the December 2011 announcement that the two organizations would be working together to improve energy efficiency and research clean energy solutions for future data centers.

“Given the rate of growth we’re seeing [in data center electricity use], it’s very important to make sure that renewable energy is a component of their growth plan,” said Gary Cook, a senior policy analyst for Greenpeace.

Facebook’s decision to build in Iowa is a sign that their agreement is working, Cook said. It will be the company’s fourth owned-and-operated data center, and second since the Greenpeace campaign. The last one was built in Sweden, also a clean energy hub.

In Facebook’s announcement, it said the Iowa data center “will be among the most advanced and energy efficient facilities of its kind.” It also notes Iowa’s “abundance of wind-generated power.”

Greenpeace in its statement Tuesday praised the site’s potential but said the company needs to work with the local utility, MidAmerican Energy, to increase its renewable energy mix.

“In Iowa, Facebook has chosen a location where it has great potential to power its newest data center with the wind energy that is booming there, but to do so it must show a willingness to work with Iowa’s major utility, MidAmerican Energy, to provide more clean energy to the grid,” it said.

Hydro to wind power

The Pacific Northwest has long been a destination for data centers because of generous tax incentives and cheap hydroelectric power. In Iowa, incentives and low electricity prices are also drivers.

Iowa’s average electricity rate is about 2.5 cents per kilowatt hour below the national average, according to data from the U.S. Energy Information Administration.

How much credit wind energy deserves for keeping prices down is tough to pinpoint, said David Osterberg, executive director of the Iowa Policy Project, a nonprofit research organization that’s studied the rate impact of wind power.

“All you can say unequivocally is nearly a quarter of all the kilowatt hours produced here are from wind, and we still have rates more than 2 cents a kilowatt hour below the national average. I can’t say that one caused the other, but our wind sure didn’t hurt,” he said.

Harold Prior, executive director of the Iowa Wind Energy Association, said data centers’ interest in clean energy could further boost the state’s wind industry as they work to green their impacts.

“I don’t think there’s any question that there will be a number of wind farm developers that are going to be extremely interested in working with these data centers.”