Google Gives Up On Green Tech Investment Initiative RE<C

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Among yesterday’s service shutdowns at Google, which included underperforming and deprecated Web properties like Knol, Wave and Gears, there was also news of the end of RE<C. What’s RE<C? Just one of those ambitious “we can save the world with Google money!” type projects that gave the search giant the appearance for caring about more than the influx of ad dollars. In this case, RE<C was focused on lowering the cost of renewable energy. Or, as the acronym indicates, to make “renewable energy” (RE) less than (cheaper than) coal (C).

As it turns out, that was easier said than done.

RE<C was announced back in 2007 by Google.org, the philanthropy arm of Google. The company made several investments in companies in the greentech/cleantech space, including Brightsource Energy, eSolar, and the geothermal drilling innovators Potter Drilling. The project’s funding helped sponsor research that was used to develop the first Geothermal Map of the U.S.

A $10 million equity investment in Brightsource through RE<C was also put towards the development of a type of concentrating solar power technology called the solar power tower which works using a field of mirrors (heliostats) to concentrate the rays on the top of the tower.

What’s interesting about the RE<C project, is how unceremoniously it was lumped in with duds like “Knol” (Google’s wannabe Wikipedia) and outdated tech like Google Gears (a stopgap solution for the pre-HTML5 days). Unlike those abandoned Web technologies, RE<C represented a not-so-insignificant source of investment in the green tech space.

When the initiative was announced in 2007, Google said it expected to spend “tens of millions on research and development and related investments in renewable energy.” And that was only the beginning. Google also claimed that it anticipated investing “hundreds of millions of dollars in breakthrough renewable energy projects which generate positive returns.”

Over RE<C’s run, Google.org invested over $10 million in Enhanced Geothermal Systems (EGS) technology. However, outside of RE<C, Google invested $38.8 million in wind farms developed by NextEra Energy Resources, and an undisclosed amount for a 37.5% equity stake in the Atlantic Wind Connection (AWC) backbone, which aims to connect to 6,000 MW of offshore wind turbines in the Atlantic Ocean.

To date, the company says it invested over $850 million in the renewable energy sector, and only around $30 million of which came through RE<C. The renewable energy projects in total were capable of generating 1.7 GW of power and the electricity equivalent of that used by 350,000 homes. Other investments have included $280 million in Solar City, $157 million in a wind farm in the Mojave, $100 million for Oregon’s Shepard’s Flat wind farm, approximately $5 million for a solar facility in Germany, $75 million to create a fund with Clean Power Finance (CPF) and others listed here.

Google also poured $168 million into the world’s largest tower project – Brightsource’s Ivanpah Solar Electric Generating System (ISEGS), now set for completion in 2013. The tower will generate 392 MW of clean solar energy.

It is unclear to what extent this level of investing will continue with the shuttering of the RE<C initiative, which Google Co-founder, now CEO, Larry Page once spoke of so highly:

We want to apply the same creativity and innovation to the challenge of generating renewable electricity at globally significant scale, and produce it cheaper than from coal. With talented technologists, great partners and significant investments, we hope to rapidly push forward. Our goal is to produce one gigawatt of renewable energy capacity that is cheaper than coal. We are optimistic this can be done in years, not decades.

If we meet this goal, and large-scale renewable deployments are cheaper than coal, the world will have the option to meet a substantial portion of electricity needs from renewable sources and significantly reduce carbon emissions.

We expect this would be a good business for us as well.

Sadly, it seems that some $850 million later, Google doesn’t think green tech is a good business after all.

Update: This article was updated to clarify that NextEra and AWC were investments outside of RE<C. Additionally, a Google spokesperson says “we remain committed to the renewable energy sector and we plan to continue investing to add to our over $820 million in energy project investments.”