Growing valley guzzling power at high speeds

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San Jose Mercury News

SAN JOSE, Calif. _ As California struggles with its chronic power shortage, Silicon Valley’s unquenchable thirst for electrons is boosting maximum power use far more quickly here than it’s rising throughout the state. Peak demand in the nation’s high-tech hub is growing six times faster than in Los Angeles and almost twice as fast as in other parts of Northern California.

That steady rise underscores just how much Silicon Valley’s robust growth has contributed to the state’s power woes. With the Legislature in a desperate race to patch the problem, lawmakers have singled out the valley, which sucks up far more juice than it makes, as a prime culprit. A review shows that situation may well get worse.

Since 1994, peak demand has grown by an average of more than 6 percent a year in Silicon Valley. By contrast, peak demand in San Francisco and Los Angeles has barely crept up.

The economic dynamics of Silicon Valley’s tech industry and all that goes with it _ along with a general inattention to old-fashioned conservation _ is driving the ever-higher spikes in peak demand here. It’s more jobs, people, houses, malls, computers and gadgets. Between 1993 and 1998 San Jose added more high-tech jobs than any other city in the country.

Chances are good that if you have an AOL account anywhere in the United States, your online traffic zaps through San Jose. Or that if you have a Hotmail account or use New York-based Merrill Lynch’s Web site, your clicks pulse through Santa Clara.

Some of the Internet data centers proliferating around the valley _ so-called server farms that run Internet sites for other companies _ draw enough power to run four steel mills, illustrating just how electricity-intense is the technology industry that has driven California’s unprecedented economic boom.

No one knows how much of the overall growth in electron demand comes from server farms. It’s difficult to even nail down exactly how many server farms _ also called “co-location” services _ have sprung up here since pioneer Exodus Communications started in Santa Clara in 1994. Industry analysts estimate there are a couple dozen to 40 or more.

“There’s probably more co-location and network services in Silicon Valley than any other single spot on earth,” said Jeff Monroe, a vice president at MetroMedia Fiber Network in upstate New York, which recently bought AboveNet Communications Inc. in San Jose. AboveNet converted downtown San Jose’s failed Pavilion retail center into a server farm.

Silicon Valley is Internet ground zero _ home to at least three of the world’s dominant Internet exchanges, including MCI WorldCom‘s Metropolitan Area Ethernet installation (known as MAE West) in San Jose and Compaq Computer’s Palo Alto Internet Exchange.

Sever farms consume copious amounts of electricity _ 85 to 100 watts per square foot or more, according to John Roukema, assistant director of Silicon Valley Power, the city of Santa Clara’s municipal utility. That’s up to three times what the average silicon chip factory uses, at 30 to 50 watts per square foot. A standard office uses five watts per square foot.

Not only do the farms require electricity around-the-clock (the Web never sleeps), but they require much air-conditioning to get rid of the heat from the humming machines.

The nine server farms Exodus Communications owns in the Bay Area _ six are in Santa Clara _ help run Internet sites for 4,000 corporate customers, including Connecticut-based General Electric Co., Seattle-based Microsoft Corp. and Merrill Lynch & Co.

At its peak, the Santa Clara group of Internet data centers uses 12 megawatts, according to Jim Stoddart, senior vice president of facilities. That’s the equivalent of about three steel mills or 12,000 homes. A typical auto body plant uses about eight megawatts, according to the Edison Electric Institute in Washington, D.C.

There are many other server farms around the Bay Area:

AT&T has an 85,000-square-foot data center in Redwood City.

Excite(AT)Home’s 11,000-square-foot data center with 1,600 servers is also in Redwood City.

AboveNet runs four server farms in San Jose, including one 120,000-square-foot center, and one in San Francisco. The facilities use 10 to 20 megawatts of power.

But server farms are just a piece of the puzzle.

Exodus notes that its 12-megawatt peak is a minuscule portion of the area’s peak demand. “Obviously there’s a lot of other growth in the area besides Web hosting,” Stoddart said.

That’s true. Led by Silicon Valley, the Bay Area outpaced the state and nation in job growth from 1994 to 1999. New construction _ mostly non-residential such as offices _ surged to record levels.

Along with this relentless growth came more and more demand for electricity.

Silicon Valley Power, for instance, has received more than 50 requests, mostly from Internet data centers, for hook-ups. If they all come online in the next three years, Silicon Valley Power expects its peak demand to increase dramatically, from 457 megawatts last year to 744 megawatts.

The area has come under criticism in Sacramento for guzzling more power than it generates. And the San Jose City Council’s unanimous decision to reject Calpine Corp.’s proposed 600-megawatt plant for North Coyote Valley has become a focal point for this anger.

The counties of San Mateo, Santa Clara, Alameda and Contra Costa have 64 power plants capable of generating about 4,647 megawatts. Peak demand is 8,167 megawatts.

The Bay Area’s leap in demand _ coming as the state wrestles with a possible multibillion-dollar bailout of two utilities _ has some consumer advocates asking whether the pain is being fairly spread around. On average, Pacific Gas & Electric Co. residential customers pay about 11.7 cents per kilowatt hour of electricity. Large industrial users pay an average of about 7.1 cents, according to the California Public Utility Commission. Groups such as the Utility Reform Network in San Francisco argue that the rate differences amount to an unfair subsidy for large corporations.

“The small consumers of this state are being asked to carry the bulk of the burden and subsidize the biggest users in the long-term solution here,” said Doug Heller, of the Foundation for Taxpayer and Consumer Rights in Santa Monica. “That is at the heart of the consumer question here: Will the big guys take some responsibility?”

The utilities commission says the prices differ because it’s easier to serve large industrial customers. Industry advocates bristle at the finger-pointing and argue they get discounts because they buy in bulk.

“We got here together,” said Carl Guardino, president of the Silicon Valley Manufacturing Group and one of five new board members of the California Independent System Operator_the keeper of the state grid. Tech companies have stepped up to the plate by conserving energy and adjusting to costly interruptions in electricity, argues manufacturing group spokeswoman Michelle Montague-Bruno. The industry group estimates that its members lost “tens of millions of dollars” during the rolling blackouts on Jan. 17 and 18.

“It’s me, it’s all of us,” Montague-Bruno said. “It’s the cell phones. . . . Every step of the way in building those products, and using and owning those products, uses power.”

Consumer Watchdog
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