Jun. 3, 2013

Summary:

Verizon is now the latest customer of Silicon Valley’s buzzy fuel cell company Bloom Energy. The trend of telecom and Internet companies increasingly turning to clean power options continues to

Following on Verizon’s announcement a few weeks ago that it plans to spend $100 million on clean power — both solar panels and fuel cells — for its operations, the telecom giant announced on Tuesday that it plans to buy fuel cells from Silicon Valley’s Bloom Energy to power some of facilities in California. The ten Bloom Energy fuel cells (200 kW each) will deliver more than 16 million kilowatt hours of electricity for Verizon in California per year, or a quarter of its clean power capacity plans.

Verizon is also buying a bunch of fuel cells from ClearEdge Power for operations in other states, but is specifically installing Bloom Energy’s fuel cells within California. While Verizon wouldn’t comment on why it chose Bloom Energy as its supplier for California and ClearEdge as the supplier of fuel cells in other states, I speculate that the choice to go with Bloom in California was because Bloom works with California incentives to reduce the cost.

Verizon is one of a variety of telecom and Internet companies that have been increasingly turning to clean power to help provide electricity for infrastructure and buildings. Google has invested over a billion dollars into clean power projects. Apple (a AAPL), eBay, and Microsoft are deploying substantial clean power at data centers. AT&T has also purchased Bloom Energy fuel cells for its operations in California.

Internet companies are embracing clean power both to help add off-grid resiliency, as well as lower carbon emissions. Verizon’s Chief Sustainability Officer James Gowen told me back in April that the company’s clean power initiative is being driven both by the desire to add energy resiliency to Verizon’s facilities as well as the company’s sustainability goals.

During superstorm Sandy, a Verizon fuel cell installation in Long Island that powered a switching station (using fuel cells from UTC Power, which was acquired by ClearEdge Power) never went down. Verizon is also looking to cut its carbon emissions footprint substantially by 2020.

Verizon’s Bloom Energy fuel cells will be installed at two call-switching centers in Los Angeles and San Francisco, and a data center in San Jose. In total, Verizon’s clean power technology, including solar and fuel cells, will provide 70 million kilowatt hours of electricity for its operations, which is the equivalent of enough power for 6,000 homes per year.

Fuel cells look like industrial refrigerators, and they use a chemical reaction to produce electricity and heat. They are filled with large stacks that are lined with a metal catalyst, and a fuel (natural gas or biogas) runs over the stack, creating a chemical reaction that produces electricity and heat. The benefits of fuel cells are that the electricity can be created on site where it is used (so it’s more efficient), and if biogas is the fuel, then the electricity is also free of carbon emissions.

Bloom Energy has raised over $1.1 billion, including a recent $130 million, to grow its business. We’ll be interviewing Bloom Energy’s VP of Mission Critical Systems, Peter Gross, and eBay’s VP, Global Foundation Services, Dean Nelson at GigaOM’s Structure conference on June 20 in San Francisco.

http://gigaom.com/2013/06/03/verizon-to-buy-bloom-energy-fuel-cells-for-data-center-switching-centers-in-ca/