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Google sees energy solution in the math

Google's CEO envisions 50 percent cut in emissions through renewable energy sources and plug-in hybrid cars.

Eric Schmidt demonstrates how Google Earth can help people learn about the effects of global warming at the Corporate EcoForum. Stefanie Olsen/CNET News

Correction: This story originally misstated Schmidt's total energy savings projections. He said that the U.S. would save $2.1 trillion of $2.7 trillion.

SAN FRANCISCO--Google CEO Eric Schmidt outlined an energy plan Monday to reduce America's dependence on oil and create green jobs.

At an event called the Corporate EcoForum, Schmidt laid out Google's energy plan to sustainability executives from Coca-Cola, Motorola, Clorox, Microsoft, and dozens of others. In characteristic Schmidt-Google fashion, he backed up the idea with some calculations. The plan could be compared to something like energy efficiency = savings (or E2=$).

"It's just a math problem," Schmidt said to a crowd of executives here at the Fairmont Hotel.

He said that, if by 2030, the U.S. were to adopt renewable energy sources for 100 percent of its power generation, replacing energy production from coal-fired plants, and replace at least half of its cars with plug-in hybrids, then it could cut carbon emissions by half. (And potentially avert a global warming crisis.)

No easy feat. But if the plan is adopted, Schmidt calculated that the U.S. would save 77 percent of $2.7 trillion in energy spending over the next 22 years. So expenditures would only be $600 billion; or assuming an 8 percent discount rate (factoring interest rates), the government could save even more in that time.

Google is taking its own advice. He said the company's plan is to reduce global demand for oil and help to generate new white- and blue-collar jobs by investing in solar, wind, and geothermal energy projects.

So far, has invested $10 million in geothermal energy and another $10 million in wind technologies. There are 500,000 jobs in wind companies alone, Schmidt said.

Google has chosen to bet on those renewable energy sources because they have the proof points to back up their viability, he said. It has avoided nuclear power as an investment because of security concerns, he said, but Google may consider wave power as a fourth or fifth investment in its plan.

Google has filed patents on a floating barge of network computers that would be powered by wave energy--a move that was disclosed this week. Schmidt said that as far as he knows that the company is not developing anything like it now, but he said, "You never know at Google."

"The model you have of a distributed renewable power structure. It's a matter of how long is the payback?" he said.

For example, Schmidt said that years ago he considered the fact that 40 percent of carbon emissions originate from buildings. At the time, he asked his facilities people what they could do to mitigate the problem, and they had estimated that it would cost $5 million to make Google's buildings more energy efficient. The company would reap the benefits after 2.5 years, he said.

"So what else could we do?" Schmidt said. Google outfitted a dozen buildings and a couple of carports with solar panels a year and a half ago, and it now has a dynamic internal system that measures energy savings by building.

"The question is: can any one of you make a difference...Of course we can," Schmidt said. "But we must have a policy."

Smart garages
He attributed the current climate crisis to a "total failure of political leadership." Leaders are shortsighted about the benefits of technology to solve issues of global warming, he said. When asked which presidential candidate he supported, Schmidt declined to comment.

He talked about changing government incentives for business owners so that they're encouraged to create energy efficiencies. And for consumers, he said the trick will be in creating a "real-time information loop," such as household smart meters so that people can see how much money they're spending on energy.

Google Earth is a means to help people see the scope of the climate change problem with the use of data and graphics, according to Schmidt. For example, he showed the North Pole without ice in 2050 if current projections of climate change stay on course and temperatures there rise to 40 degrees C.

Google is also board member of a new group called Climate Savers Computing Initiative, a coalition that aims to reduce computing power consumption by half by 2010. It will do that largely by encouraging member companies like Google to turn off computers when they're not in use. Schmidt said that if it reaches its goal, it would be the equivalent of taking 11 million cars off the road.

The power grid is also a problem and area for innovation, he said. There's a 9 percent efficiency loss in the current grid infrastructure, which could be offset with smart technology systems, he said. For example, a plug-in vehicle's batteries could be charged at night and then send surplus energy back into the system during the day, shifting power back to the grid at peak energy-usage times, he said.

"I could imagine a smart garage where I would plug in my car and the computer handles it. I could even make money by cost shifting," he said.

"It sure sounds to me like a problem for the Internet...and personal computers. It's the largest opportunity I could possibly imagine," he said. "It solves energy security, energy prices and job creation...and by the way, climate change."