Google invests in BlackRock-owned solar firm to meet net-zero emissions goals

Brief description of the dive:

• Google is partnering with BlackRock’s climate infrastructure division on an equity investment in one of the firm’s Taiwan-based portfolio companies, New Green Power, BlackRock said on Monday.
• In exchange for the investment, the exact terms of which were not disclosed, Google will have the right to purchase up to 300 MW of solar power from New Green Power’s Taiwanese solar assets. New Green Power will also give Google the ability to expand its solar capacity to Google suppliers in the region to help the company achieve its goal net zero emissions throughout the supply chain by 2030.
• Google’s net-zero ambitions are based on a goal of running all of its operations on carbon-free energy, and achieving those goals will be “challenging” and will require “commercial efforts as well as broader changes to energy systems,” Amanda Peterson Corio, head of Google’s data center energy, said in an emailed press release.

Diving Insight:

For BlackRock, the firm’s climate infrastructure portfolio company will help expand solar capacity in Taiwan and enable the firm to increase investment in the region.

BlackRock’s climate infrastructure division owns 100% of New Green Power through one of its funds, by purchasing it in its entirety in 2022 after an initial investment in 2020. Through the solar business — which has 1 GW of development potential — BlackRock aims to capitalize on Taiwan’s energy transformation, where the country is targeting 20 GW of solar capacity by 2025 AND 80 GW of capacity by 2050.

David Giordano, global head of climate infrastructure at BlackRock, said in a statement that the deal demonstrates Google and BlackRock’s “shared commitment to the transition to a low-carbon economy.”

“As demand for digital services, powered by artificial intelligence and data-centric technologies increases, it becomes imperative to invest in infrastructure that not only supports this growth but also aligns with our clean energy investment strategy,” Giordano said.

The partnership will provide Google with a solution that can be scaled to the tech company’s operations in Taiwan, according to Ross Mackey, portfolio manager for climate infrastructure at BlackRock.

Taiwan is home to Google’s largest hardware manufacturing center outside the United Statesand the company was opened second building on campus in April, the focus was on artificial intelligence, as well as semiconductors and sixth-generation wireless communications, or 6G.

BlackRock has identified infrastructure as critical to its business this year and has opened it Acquisition of Global Infrastructure Partners for $12.5 billion in January. At the time, CEO Larry Fink cited “the movement toward decarbonization and energy security in many parts of the world” as a factor in favor of the deal.

However, the Federal Energy Regulatory Commission sent both companies a letter in June saying considered the proposed connection to be defective in seven areas. Both companies will have to address the commission’s concerns, including whether the transaction complies with the Federal Power Act, before the deal can proceed.