Ep58 A corporate leader driving Asia’s energy transition, ft. Giorgio Fortunato, Google

This episode features Giorgio Fortunato who leads Clean Energy and Power at Google in Asia Pacific. He outlines Google's dedication to clean energy, including its ambitious 24/7 carbon-free energy target by 2030. Giorgio explores the Asia Pacific region's unique challenges and opportunities, such as grid infrastructure development, diverse clean energy procurement strategies, and the crucial role of data transparency. He also shares specific examples of Google's successful clean energy projects across Australia, India, Japan, and Singapore, emphasizing the need for customized solutions to effectively address the diverse needs of each market.
RESOURCES:
1. 24/7 Carbon-Free Energy Procurement in APAC: Pathways for Companies and Countries (BloombergNEF and the Global Renewables Alliance)
2. The Role of High-Impact Utility Green Tariffs (ACEC and CEBA)
3. New paths for clean energy in Asia-Pacific (G Fortunato)

ABOUT GIORGIO. Giorgio leads Clean Energy and Power at Google in Asia Pacific. He is responsible for securing Google's data centre and operational energy needs in the region, while driving Google's efforts to achieve 24/7 carbon-free energy and net-zero emissions across Google’s operations and value chain. His experience in the energy sector includes leading Schneider Electric's Cleantech advisory in APAC, co-founding the offshore wind startup Blue Aspirations, and holding leadership positions at Vestas Wind Systems. He also served as the National Energy Chair at the European Chamber of Commerce in China. Giorgio holds a master’s in aerospace engineering from La Sapienza University of Rome and a dual-degree EMBA from Tsinghua University and INSEAD.

FEEDBACK: Email Host | HOST, PRODUCTION, ARTWORK: Joseph Jacobelli | MUSIC: Ep0-29 The Open Goldberg Variations, Kimiko Ishizaka Ep30-50 Orchestra Gli Armonici – Tomaso Albinoni, Op.07, Concerto 04 per archi in Sol - III. Allegro. | Ep51 – Brandenburg Concerto No. 4 in G, Movement I (Allegro), BWV 1049 Kevin MacLeod. Licensed under Creative Commons: By Attribution 4.0 License

Transcript

Ep58 A corporate leader driving Asia’s energy transition, ft. Giorgio Fortunato, Google

PLEASE NOTE: AUTOMATICALLY GENERATED TRANSCRIPT MAY CONTAIN ERRORS. FOR ACCURACY, RELY ON THE ORIGINAL RECORDING.

Joseph Jacobelli: [00:00:00] Hello there and welcome to the Asia Climate Finance podcast. Today we are speaking to Giorgio Fortunato from Google. And I will start with asking him a little bit about himself. So Giorgio, welcome to the Asia Climate Finance podcast. And could you please tell us a little bit more about yourself, outside your bio, which is in the show notes, of course. But specifically, how did you get involved in clean energy in the Asia Pacific region. 

Giorgio Fortunato: Thank you for having me, Joseph. And absolutely. I've always been passionate about technology and really fascinated by clean energy and sustainability. And so when I finished my studies, I applied for a job at Vestas Wind Systems a world leading wind turbine manufacturer.

And you know, the next thing I know, I'm at their headquarters in Denmark for an interview. It has been simply an amazing journey that led me from Italy, where I was born and raised, to Denmark first, and then to China. I was supposed to stay in China for eight [00:01:00] months, but you know there was a lot to do.

So, eight months turned fairly quickly into 12 years, 12 very fulfilling years. In my time in China, I had the privilege to witness China's energy transformation. You know, many new technologies, first of a kind project in the region. And today I'm in Singapore. I have the honour to work at Google with a team of extremely talented individuals in the energy and location strategy team.

Here we are expanding our operations in Asia Pacific. which is a region of focus for Google, and we have announced a new data centre investments in Malaysia in Thailand last year. And I am really excited about this space. The role we can play, how we can contribute to the energy transition in this very dynamic and growing part of the world.

Joseph Jacobelli: Talking about your China experience, I had a similar experience. I went to Taiwan for three months and stayed six years and went to Hong Kong for a [00:02:00] couple of months ended up staying 32 years. So um, and also, I think you're being a little bit modest about witnessing China's energy transition. I think you were an active participant in my personal opinion, but anyway anyone with an internet connection would know about Google.

But could you briefly explain how and why the company is involved in clean energy and the energy transition. 

Giorgio Fortunato: Yeah, sure. So Google's mission is to organize the world's information and make it universally accessible and useful. And to do this, Joseph we do need energy. We need energy to power our data centres and all our operations.

We need energy in our supply chain to produce the chips that are critical to power our digital products and services and ecosystem. And, you know, sometimes it's hard to connect something digital, like the products and services we use every day with the [00:03:00] physical infrastructure where that digital world actually lives.

But that link is definitely there, and I think that ensuring that our digital growth is sustainable it's really a defining challenge of our times, of our generation. We will rely more and more on cloud computing, on AI, and so AI and sustainability become very interlinked. And so for every Google search, for every Maps journey, every YouTube video, we really want to be conscious of the energy powering those experiences.

And it's because of this that today Google's commitment to energy efficiency and clean energy is just simply greater than ever before. 

Joseph Jacobelli: Mm, mm, mm, mm, mm, mm, mm. Got it. Looking a little bit about the backdrop Giorgio you know, globally speaking. Google, I read has a goal to be running 24 7 carbon free energy by [00:04:00] 2030.

Could you tell us a little bit about the journey so far, given that you're involved in this journey in the Asia Pacific region? 

Giorgio Fortunato: Okay. Maybe let's go back a bit to the start of our clean energy journey. It all began in 2010 when we signed our first power purchase agreement. And we were sourcing wind energy for one of our data centres in the U. S. I wasn't a Google back then, but I hear from another Googler that at that time there was no big goal, no real market either. And as she puts it, we just knew it was the right thing to do. So, you know, fast forward to 2017 Google made history as the first company of our size to match 100 percent of our global annual electricity use with clean energy.

And we have achieved that every single year since. And this is a remarkable milestone. And our goals have also evolved. So today we are aiming even [00:05:00] higher. In 2020, that is our third decade of climate action. We announced our goal to procure clean energy to meet our electricity needs every hour of every day within every grid where we operate.

And as you know, we call this the 24/7 carbon free energy goal. 

Joseph Jacobelli: Right 

Giorgio Fortunato: now operating on 24/7 carbon free energy is far more complex and technically challenging when compared to annual global matching. And no company of our size has ever achieved this before. But over the past few years, we have made really significant progress towards this goal.

And if you think globally, just last year we signed agreements for around four gigawatts of new clean energy. And it has been a record year for Google. In 2023, we also maintained 64 percent of our carbon free energy score globally, again, on an hourly [00:06:00] basis across our data centres and offices. And we are already above 90 percent in 10 of our grid regions.

And this is even as our total electricity consumption is increased. And we'll we can talk. We'll talk more about APAC as well. The other area of focus, Joseph, is being the energy efficiency. So the cleanest energy is the energy you never use in the first place. 

Joseph Jacobelli: Of course. 

Giorgio Fortunato: And so we really strive to build the most energy efficient data centre infrastructure in the world.

Each Google data centre is designed to use as little energy as possible. And just think that compared to only five years ago, our data centres delivered today, nearly four times as much computing power with the same amount of electrical power.

Yeah, absolutely. And look, the 24/7 carbon free energy [00:07:00] journeys is really a massive undertaking. And well, there are no easy answers. So to get this done, it will take a lot of continued hard work, ingenuity and collaboration, both within Google and beyond Google. 

Joseph Jacobelli: And I mean, from my personal perspective, I just wanted to add that given the nature of the power markets, if you look at The Asia pacific region each power market is very different.

Some are fully liberalized. Some are still, you know, virtually integrated So you know, it sounds easy. We're going to go a hundred percent; you know clean energy But I’m sure that there's some very significant challenges there in my opinion. But anyway Given your extensive personal involvement in the clean energy sector in the Asia Pacific region.

Can you just briefly summarize your thoughts regarding the evolution where we're at now in general, the biggest challenges, the clear opportunities for [00:08:00] investors in clean energy projects in Asia in general, and just in 30 seconds, no, just kidding. Just kidding. So 

yes 

it's a big question. 

Giorgio Fortunato: Yeah, and, and let's, let's put things into perspective, Joseph.

So in Asia Pacific is, is really an absolutely crucial region. Uh, APAC's share of global greenhouse gas emissions has doubled since 1990. And now it represents roughly half of the global greenhouse gas emissions. So you see, rapidly decarbonizing this region's electricity grids is really an economic and climate imperative.

And this is what 24/7 carbon free energy is all about. It's about grid decarbonization. We require a constant supply of energy to meet demand at all times. And we want to bring a constant equal amount of carbon free energy generation to match our load every hour of every day. everywhere. Um, I'm [00:09:00] pretty sure you came across the paper from a BNEF and GRA that was published just at the end of November last year.

It's a really interesting paper. And he talks about the 24/7 carbon free energy procurement in our region. And in particular, they model this least cost technology pathway towards 24 7 carbon free energy in several markets across Asia Pacific, think India, Japan, Thailand and Vietnam. And I think it's really important that we Maximize the use of mature technologies.

So wind and solar, for example. But we also need to invest in new clean technologies. These new clean technologies that, you know, they might not be part of our toolkit right now, but they will be part of the mix later on. And I'm talking, for example, about geothermal, bioenergy, and we really like all the clean, [00:10:00] dispatchable technologies.

And it's important to Also, remember that if we optimize this mix of different technologies, this is how we can achieve 24/7 decarbonization at the lowest possible cost. Regarding challenges well, if you come to mind. The first one, grid infrastructure and second, the access to clean energy and specifically, you know, the clean energy procurement avenues and the third is the data transparency and the data granularity.

So let me go one by one on the first point. The challenge I see is really how do we expand today's transmission systems? 

And we, we need to. invest in grid infrastructure and adopt dynamic systems that use our existing transmission network efficiently. Because otherwise we will always end up with approaches that curtail renewables, right?

To prioritize existing thermal power plants. And [00:11:00] Particularly in Southeast Asia, building more interconnection capacity between all the neighbouring countries could really lower the decarbonization costs and, you know, accelerate the speed of the energy transition. And on the second point, we really need to make sure that everyone has access to affordable, clean energy.

And as you mentioned, depending on the particular Electricity market structure, the complexity of corporate clean energy procurement for sure will vary. But it's important to have options to buy clean power, whether it is power purchase agreements, utility green tariffs, behind the meter options, because you see, what works for us might not work for another company.

And our approaches are different from each other. You know, we, we, our load profiles are different. Our volumes are different. The risk appetite is different. So we need options to ensure that energy consumers of all sizes that are operating [00:12:00] across different markets can all play a role in, in the energy transition.

And finally, on my third point on the data transparency, we need to improve the electricity data transparency because we need accurate views of what's happening on our grids and in our operations. We need to understand where the gaps are so, you know, we can be strategic about how we address them, where do we want to grow, how we can contribute.

And so we simply need to bring in. a lot more granularity, Joseph. On, on the second part of your questions the question on opportunities for investors, I think look, the space of emerging technologies in my view is really fascinating because as I mentioned earlier, these technologies are, are really crucial for, for grid decarbonization at scale, but they do face a lot of barriers to commercialization. This could be like regulatory ecosystem challenges, supply chain barrier workforce [00:13:00] barriers and of course financing. So I think investors Whether they are corporates venture capital firms, PE firms, they can really play an important role here. And you know, I find it also fascinating how much the role of corporate off takers has evolved and is continuously evolving over time.

Just last year, for example, we have decided to make a capital investment in Taiwan where clean energy is limited, and this investment helps accelerate solar development in the market. So in Taiwan, we partner with NGP, that is a portfolio company of BlackRock's climate infrastructure business, and we are providing support for the development of a large Pipeline.

It's a one-gigawatt pipeline of new solar projects. So essentially, we are helping to jumpstart these projects by providing funding. And it's not only for Google benefit. [00:14:00] In fact, as you can imagine, many of our suppliers that are in the semiconductor life cycle have operations in Taiwan too. And so this gives us a really great opportunity to offer some of this new solar capacity to them. which in turn will help them achieve their own sustainability targets too. 

Joseph Jacobelli: Indeed. And I think, you know, the point about data granularity, is always not, not put into the top three of the agenda, but actually it is incredibly important. And in the last episode of the Asia climate finance podcast, we talked about it with Mike Thomas of the Lantau group about demand.

And you know how now it's getting a lot harder to. Forecast demand. And if you, if it's hard to forecast demand, then it's hard to forecast, you know, how much capacity you'll need to meet the demand, et cetera, et cetera. So it's a, it's a kind of a catch 22 kind of situation. So it's extremely important.

But talking about corporate [00:15:00] procurement specifically, we had the pleasure of speaking to Suji Kang from the Asia Clean Energy Coalition back in episode 42 of this podcast. And last November, the Clean Energy Buyers Association or CEBA, CEBA together with the Asia Clean Energy Coalition produced a report with the help of Google Asia Pacific titled, it's a very long title.

I'll just remind you "The role of high impact utility green tariffs, expanding clean energy procurement options in the Asia Pacific region". Could you tell us a little bit more about clean energy procurement in general and what you're seeing in the Asia Pacific region right now and what this report aimed to address and some of its key conclusions?

Giorgio Fortunato: Definitely happy to Joseph. And first of all, a big shout out to Suji and the teams and the members of Asia Clean Energy Coalition and CEBA. Thank you for the great [00:16:00] contributions. So to offer a bit of context, demand for clean energy from companies in Asia Pacific is growing. We have seen corporate clean energy procurement avenues evolve in the right direction.

In several markets over the past a few years, and however, in some markets, it can still be difficult for companies to buy clean energy because these options are either lacking or limited. And for example, in certain markets, you can only sign physical PPAs and not virtual PPAs. In some other markets, there are new pilot schemes, but these schemes are still evolving and being optimized.

Right. And this paper developed by CEBA and ASEC focuses on one of these procurement avenues. That is the utility green tariffs or U.G.T.S as sometimes we refer to them in short. So what is exactly a U.G.T.? Well, a Utility Green Tariff is a, a [00:17:00] voluntary program that allows companies to buy clean energy and associated the energy attribute certificates, of course, directly from their utility company.

So we can think of it as a special deal for clean energy in essence, positioning utilities and customers as partners in bringing more clean energy online. And you know, a UGT is a simpler alternative to other options like virtual or physical power purchase agreements and an important aspect of a UGT.

Is that it offers price stability over the long term and this price stability is something that other products such as the green premium products, for example, cannot offer, do not offer because these are structured as. And adder on top of the brown electricity in exchange for the energy attribute certificates.

So the paper essentially discussed what [00:18:00] are some of the key principles for designing effective UGTs. And it explains that utility green tariffs should encourage new clean energy projects. And second, that they should have transparent and stable pricing. And third, that they should offer flexibility to meet individual customer needs.

For example, mixed technologies or options like hourly tracking, you know, so again, on the granularity. So in a nutshell the main key takeaway I would say is that a well-designed utility green tariff can be a very valuable tool for companies off takers to, that are looking to procure clean energy and so that they can contribute to clean the grids.

And this needs to happen alongside a portfolio of, corporate procurement options. Personally, I think UGTs will play really a key role in some of the Asia Pacific [00:19:00] markets. These are an interesting solution to accelerate the energy transition here. 

Joseph Jacobelli: Right. But it's worth emphasizing that it's still a little bit early days for the UGTs in, in, in Asia. It's just something that, I mean, the way I look at it, Giorgio, I don't know if you agree, but you know, five years ago, we weren't even talking about that. And now it's, you know, growing, you know, it could be growing faster. It could be, could be more, more widely spread, but at least, you know, it exists. And there's a lot of countries, you know, if, if one country, one jurisdiction does it, then the other jurisdiction is going to say, Oh, So that's kind of working. Maybe we should do it as well. So I think it's development, it's developing, but I think it's very, very important that we understand the trajectory. 

Giorgio Fortunato: Absolutely. And, and back to the diversity of these Asia Pacific markets, right? So there are some decarbonization avenues that work very well in one market and maybe don't not work as well in another market.

So it's really about finding what [00:20:00] Corporate clean energy procurement avenues are the most effective in different contexts. 

Joseph Jacobelli: Custom made solution, tailor made solutions, right, for individual jurisdictions. 

Moving a little bit away from what we discussed and looking more at Google specifically in a recent report that you personally wrote you highlighted the locations where Google has announced carbon free energy agreements across the Asia Pacific region.

Specifically, you mentioned the company has signed long term agreements for no less than 275 megawatts of new clean energy generation capacity in four countries, namely Australia, India, Japan, and Singapore. Could you very briefly tell us a little bit more about your personal views? On, on some of these markets were, were these projects straightforward?

I'm sure they were not. But anyway, I'm asking, were these projects straightforward to put together or were there particular hurdles that needed to be [00:21:00] overcome or particular considerations that had to be given for some specific markets? 

Giorgio Fortunato: Yeah, sure. Happy to share some more insights. And as we were just telling you know, sometimes, Joseph, I feel that we have taken all these different markets that are very unique, these regions and countries.

We put them all in one basket and called it APAC, right? 

Joseph Jacobelli: Right, right. 

Giorgio Fortunato: And, you know, because the markets are so different, the challenges and the opportunities Are very different. The speed at which these markets are evolving is different. The energy needs are different. And so, you know, when we look at the electricity markets here, for example, we have the entire spectrum.

We have deregulated the wholesale electricity market. So we have a vertically integrated markets and we have resources that are very the resource availability varies a lot. You know, we have abundant solar in Southeast Asia, for example, in India in Australia, we have offshore wind resources in Japan, [00:22:00] in Taiwan, in South Korea, and so.

You know, we have geothermal potential. We have emerging energy storage potential and advanced clean technologies that are being tested and developed. And I really believe that a lot of innovation will come from this region in the future. 

And I think that the key is really to make Understand that the path to decarbonization isn't one size fits all because, as I said, you know, one solution that is working really well in one market may very well be a square wheel in another context.

And so what we have been doing is working hard to tailor solutions to each and every local energy market, local regulatory environment, local resource landscape. And at the same time, keeping in mind scalability, right? So let me give you some examples. In Japan, for example this is one of the key issues that we face is the limited land for solar [00:23:00] deployment.

And, you know, to overcome this obstacle, we have been working with partners to aggregate the supply from many small-scale solar projects. And these small-scale solar projects are built on a new plot of land that they are built on parking lots. And we have even been sourcing clean energy from a project that is built on a golf course that has been repurposed for solar power.

Like and so. You know, this allows to have an aggregated procurement solution where we are able to source a combined 60 megawatts of new solar capacity to support our data centre in site and our operations in the market. In Taiwan, we are collaborating with BlackRock on the investment I mentioned earlier.

In Australia and India, this is also very interesting because these are cloud regions, meaning that Google does not own and operate our own data centres there, but we have signed very interesting agreements that involve [00:24:00] multiple parties and multiple projects. In some cases, it's a solar wind hybrid power plants, and these are, you know, new procurement structures that we have been deploying and through Google's long-term commitment to offtake from these projects, the developers we work with are able to secure the necessary financing and so make these clean energy projects a reality.

And lastly here in Singapore where we know that the path to decarbonization will look different, and we'll rely on new advanced clean technologies and energy imports. We have committed to offtake from our first of a kind sustainable biomass power plant. And to tell you a bit more about this project, the, energy plant optimizes the use of waste wood. This could be horticultural waste wood from the logistics industry and turns the waste wood into energy. And it is also equipped with a [00:25:00] pilot technology that we will use to capture and utilize the carbon dioxide. 

So, you know, I think it's really about understanding the landscape and then thinking creatively thinking.

How can we really push the boundaries of what is possible? How can we turn challenges into opportunities? 

Joseph Jacobelli: Giorgio, just a supplemental question. I mean, you make it sound very easy, but it's incredibly complex because number one, you've got, you know, geological challenges, you've got the power market structures, challenges, et cetera, et cetera.

And, you know, there's a lot of key challenges. If I were to put together a list of key countries in Asia there'd be, you know, there'd be quite a few. So in terms of like size and importance. So how can you kind of get your head around what is going on in the different markets, given it's so, it's so, it's so complex.

I mean, unless you have the, [00:26:00] I think 

Giorgio Fortunato: it's about really working closely with partners, understanding you know, what's the landscape. And also really not stopping at what has been done in the past and thinking, okay, what else can be done? You know, can a solution that is applicable in one market work in another market?

Can we test new things? You know it's about taking some risks. It's about getting our hands dirty really and trying solutions. I would say, yeah, flexibility, I guess, is also a key. Yes. It's a key element in my view. 

Joseph Jacobelli: That's great. Turning to, to the outlook kind of side of things in your very personal view, given, you know, given you've been around the block in Asia for, for some time.

What, what is the, your view on the outlook of clean energy in the region over the next, you know decade, two decades or three decades? 

Giorgio Fortunato: Sure. Well, it's a really interesting question, especially for the time window that you're asking for. So [00:27:00] three decades seems maybe a really long time. But then it's also true that the infrastructure and technology development and timeline and the learning curves do take time.

So I envision a system that is optimizing the natural resources we have. Working I can say in harmony with the environment. So where, for example, we have supply side and demand side actors that are able to participate together in running our grids. For example, flexing load according to availability of clean energy.

And really, I think as infrastructure grows and we will be planning our infrastructure, our energy, our transmission all in parallel. And I think it's also a system where we share more, we share resources so we can avoid the over dimensioning electricity systems, and we become more digital, more efficient.

And I think it's also a [00:28:00] future where we share more information. We create more transparency into what is happening in shorter time intervals on our grids. And we have, as we talked earlier, more granular information, more you know, we can, we have the tools to make better strategic choices together.

And, and lastly, it's also I think a future where we have a mix of different technologies that contribute to decarbonizing our grids. In different ways and maybe at different times or by working in combination with the more mature technologies. So yes, the glass is half full for me, Joseph. 

Joseph Jacobelli: No, and again, it is quite a complex situation that we're talking about.

 Before we wrap up our conversation are there any key takeaways or concluding remarks that you'd like to mention, Giorgio? 

Giorgio Fortunato: I just want to say that I am really excited and curious about the future. Look, Joseph, there is [00:29:00] no playbook for solving these challenges ahead of us.

And for sure, this is one of the main reasons why it is so exciting to work at the intersection between AI and energy and sustainability. So I Really look forward to contributing to this next chapter of the energy transition. 

Joseph Jacobelli: That's fantastic. Well, thank you very much for your time. As we heard during this recording, you are incredibly busy.

Given you have to keep on top of all of these different markets. So I'm really, really grateful for your time, Giorgio. And thank you so much for all of your insights. 

Giorgio Fortunato: Thanks to you, Joseph. You know, sharing and learning from each other, inspiring each other is such an important part of the energy transition journey.

And so, yeah, I just want to say thank you for everything you're doing in this space. 

Joseph Jacobelli: Thank you so much. And we've been we've been, you and I have been exchanging ideas and insights for well over a decade, so I'm sure that That's right. 

Giorgio Fortunato: 15 years. 

Joseph Jacobelli: We can continue to do [00:30:00] that for a while. Thank you so much, Giorgio.

Thank you. 

Giorgio Fortunato: Thank you.