BlackRock, Google Solar Collaboration to Power Taiwanese Data Centers

BlackRock has secured an investment from tech giant Google in one of its renewable energy portfolio companies, as data centre operators continue to seek clean energy to power their assets.

Google will provide an undisclosed amount of capital to help BlackRock-backed New Green Power expand its planned 1GW solar portfolio.

Under the agreement announced earlier this month, NGP will also provide Google with up to 300 MW of clean energy to power its data centers, cloud computing region and offices in Taiwan.

Charlie Reid, BlackRock’s head of renewable energy in Asia Pacific, said the partnership could be a sign of things to come as demand for green energy plays an increasingly important role in digital infrastructure.

The partnership with NGP marks the first time BlackRock has brought a technology company into the capital structure of one of its developers.

“It’s an interesting innovation because there’s such a huge demand for green energy from technology companies – companies that need a significant amount of energy for their data centers – that are starting to provide investment to developers as well,” Reid said.

The BlackRock and Google partnership began in 2016 when Google agreed to buy electricity from the BlackRock-financed 160 MW Tellenes wind farm in Norway.

“Since then, we’ve spent time building the relationship, but what we really wanted to do was bring it to a close with a real transaction — and this is it.”

Reid said BlackRock intends to work more broadly with Google in the future.

A Google representative said the deals with Taiwan and Tellenes have brought new, clean energy sources to their network.

“The agreement with Taiwan goes a step further as the investment in NGP is intended to catalyze additional critical equity and debt financing from other investors for its pipeline of projects, and also provides Google with the ability to direct a portion of its clean energy offtake to our suppliers in the region to help them meet their sustainability goals.”

The official said the 300MW deal “will significantly increase our percentage of carbon-free power in Taiwan.”

By comparison, Google’s last solar deal in Taiwan in 2019 – which was also the country’s first-ever solar PPA – was for just 10 MW.

Google aims to use carbon-free energy across every network it operates on, while reducing its combined Scope 1, 2 and 3 emissions by 50 percent by 2030, compared to 2019 levels.

However, in its latest environmental report, the company noted that its total emissions last year rose 48 percent compared with a 2019 baseline.

“To balance our electricity consumption (with carbon-free electricity) on an hourly basis, we will also need to explore clean energy technologies beyond solar,” the representative said.

Solar concentration

BlackRock made its first investment in Taiwan in 2018, when it acquired 28 solar projects with a total capacity of 70 MW from J&V Energy.

In 2019, the company acquired another 14 photovoltaic projects with a total capacity of 115 MW from New Green Power and J&V Energy.

Infrastructure Investor understands that in 2020, BlackRock acquired a 70% stake in New Green Power through its Global Renewable Power Fund III for approximately NT$6.8 billion (US$209.8 million; €193.9 million).

Through NGP, BlackRock has built a range of solar assets, as well as battery storage and investments in electric vehicle charging infrastructure.

Reid added that while other global players are focusing on opportunities in Taiwan’s offshore wind industry, BlackRock’s primary focus in the region is solar energy.

“If you look at the scale of the solar market in Taiwan, it really dwarfs the offshore wind market,” he said, pointing to Taiwan’s target of 20 GW by 2025, rising to 80 GW by 2050.

Meanwhile, Taiwan’s offshore wind power targets 5.7 GW by 2025, rising to 55 GW by 2050.

NGP currently operates approximately 300 MW with a further 100 MW under construction.

Reid said the company has “very large projects” in the pipeline, with a goal of having 1GW of construction-ready capacity by the end of 2025.

BlackRock believes the entire Asia-Pacific region is an important investment destination for renewable energy given its growth trajectory.

The International Energy Agency predicts that global data center electricity consumption could exceed 1,000 TWh in 2026 – roughly the same as Japan’s electricity consumption – and Reid expects about half of that demand to come from the Asia-Pacific region.

“This will be an opportunity to achieve multi-gigawatt capacity in the Asia-Pacific region,” he said.