Green vs. greenbacks.
It's a balance we've been told we have to accept. But somebody who knows a lot more about making greenbacks than the vast majority of people says it's not so. Google CEO Eric Schmidt has patiently been telling Google investors not to worry about the company's massive interest in the US energy grid. Changes have to be made to the way energy gets transported around the country in order for renewable sources of energy to play a larger role, and Google is in on the ground floor, along with IBM, Cisco, GE and others.
But the investors would still like Schmidt to show them the money.
At the WSJ's ECO:nomics conference in California, Mr. Schmidt was asked how he would respond to Google shareholders who worry the Internet titan is taking its eye off the ball by paying so much attention lately to alternative energy.
"Money we save on energy goes straight to the bottom line. Lower costs mean higher earnings. Green energy done right is more profitable than old energy," Mr. Schmidt said. "Is that a crisp enough answer for you?"
He cited Google's own multi-trillion dollar blueprint for overhauling the U.S. energy mix. Sure, the pricetag looks hefty--but it would more than pay for itself.
"That's $3.5 trillion, but over 22 years, not a matter of months," Mr. Schmidt said. "And the benefit would be $4.4 trillion."
But don't blame the investors for asking -- it's a confusing issue, and one that's bound to come up very frequently for a while, since President Obama has committed to spending some $4.5 billion on smart grid technology. Schmidt was, of course, a big Obama supporter during the election.
• First, there aren't many high-voltage lines that go to the places where renewable energy is most abundant (e.g., the Southwest for solar, the Midwest for wind).
• Second, right now there are (depending on how you count) anywhere from three to seven distinct regional grids that make up the national grid, and they aren't very well connected. While juice circulates relatively freely within these grids, it's difficult to get juice from one grid to another.