Google signs a $3 billion deal to obtain renewable energy for AI and cloud computing

With the growing need for energy that artificial intelligence and cloud computing are requiring, several companies have started signing power purchase agreements (PPA) to fulfil their needs independently from national grids. Following this trend, Google signed an agreement with Brookfield for $3 billion to deliver up to 3,000 megawatts (MW) of hydroelectricity in the US.

The companies signed a Hydro Framework Agreement (HFA) to secure supply for 20 years across the US from the Holtwood and Safe Harbor hydroelectric facilities in Pennsylvania, with a total capacity of 670 megawatts.

According to Brookfield, Google can procure carbon-free electricity from up to 3,000 MW of hydroelectric assets that will be relicensed, overhauled, or upgraded to extend the assets’ useful life and continue adding power to the grid. The two hydro facilities are the first step in this plan, focusing first on the mid-Atlantic (PJM) and mid-continent (MISO) electricity markets. However, the deal offers flexibility to expand to other regions in the country.

Hydro energy poses a particular benefit: the stability of the supply during the hours of the day. This is particularly important for companies that require a constant supply for infrastructure such as data centres.

This agreement is in line with the trend in the industry and Google’s strategy. In 2024, the company signed PPAs that accounted for more than 8GW of renewable energy across the different countries where it has operations. Similarly, the company has reported a reduction of 12% in the emissions related to data centres’ energy consumption.

Google has even signed the first PPA to acquire nuclear energy from 2035 on, to guarantee secure access to energy and decarbonise its operations. The tech giant expects to be net-zero across operations by 2030.