Microsoft data plant strengthens ties to Wyoming
By Mark Wilcox
January 9, 2013 --
CHEYENNE — Wyoming will soon be ground zero for an experimental biogas-fueled data center that could change cloud computing as the world knows it.
"It’ll be the first zero-carbon data [center] in the world," Western Research Institute CEO Don Collins said, "and it’s going to be in Wyoming!"
Collins led a team of Wyomingites tasked with bringing the facility to the state. He worked with Microsoft officials to convince them Wyoming was a viable place for such a pilot project.
"By having that conversation, that relationship, you understand what their (Microsoft’s) needs are," Collins said. "That’s incredibly valuable ... market intelligence, if you will."
Those conversational doors opened as Wyoming courted Microsoft with more than $10 million in incentives to bring in a $112 million data center in Cheyenne currently under construction.
"We have excellent working relationships with many Wyoming state and local organizations as a result of our work to locate a data center in Cheyenne," said Sean James, senior research program manager, data center advanced development at Microsoft in an email. "The city of Cheyenne connected us with the University (of Wyoming) on the project and we saw an immediate connection with their focus on energy generation and our energy use in data centers."
A brown and golden opportunity for UW
The "Data Plant," as Microsoft has dubbed the project, works with a novel array of technologies to power the small data center it has planned with human waste, completely liberated from the power grid. With the aid of an anaerobic digester brought in by Microsoft, which will hastens fermentation at Cheyenne’s Dry Creek Water Reclamation Facility, trace contaminants are filtered out of biogas and the remaining methane and carbon dioxide is then fed into fuel cells. The fuel cells from FuelCell Energy then convert those into electricity without combustion and its associated pollutants. The energy created is used to power the data center, and any excess energy can be returned to the wastewater facility to ease operating costs.
Additionally, heat created by the operations at the Data Plant will be fed back into the anaerobic digestion process, which requires heat to allow the microorganisms that do the heavy lifting to thrive. That should increase their effectiveness, and thus, Microsoft says, decrease operating costs.
"In a sense, wastewater treatment plants can be considered distant cousins of data centers," James said in a recent blog entry for Microsoft. "They are mission-critical facilities with high availability infrastructure built into the plant. These plants cannot go offline any more than a community can stop flushing."
That nature should prove to be a boon to UW, which together with the city of Cheyenne will be given many components of the Data Plant when Microsoft’s research phase is complete, most likely at the end of an 18-month window.
Bill Gern, vice president of research and economic development at UW, wrote a letter indicating many of the benefits to the university when the Data Plant lays roots in the state. He said faculty from eight programs — including computer science and a wide range of engineering programs — are developing educational opportunities that utilize the facility.
The plant may even more directly benefit the university’s students as well.
"Few UW graduates are currently hired by Microsoft." Gern wrote. "This project has the potential to clearly demonstrate the capabilities of UW students." He added this could facilitate recruitment by the tech giant at the university, directly stimulating demand for UW grads.
Collins said UW is even examining the possibility of placing interns at the facility.
Benefits to the state
A world-first in technology is generally good news for the state that fosters it. Collins said this ups the state’s image with other technology firms that could want to tackle similar projects in state boundaries.
"One of the difficulties has been attracting investors and people to ... think about Wyoming as a high-tech culture," Collins said, adding that it’s a complicated proposition. "It’s an intangible thing; but it’s a very valuable and positive thing for the state."
A second benefit to Wyoming is the "really big-picture change on that whole narrative that CO2 is only bad," Collins said.
"Microsoft being who they are and that people listen to them, [this project] could be beneficial to all the fossil energy in the state — especially the coal industry," he said.
And that’s likely to be good news for the state that has collectively granted Microsoft more than $12 million to get its two projects into the Cowboy State, including $1.5 million for infrastructure development at Dry Creek.
Microsoft may not be the only new presence because of the Data Plant, either. Because of a recommendation from Collins, who used to be close to fuel cell technology while working at the U.S. Department of Energy, Microsoft switched focus on the company that would provide the fuel cells for the project to FuelCell Energy since he thought the technology would fit better with project requirements.
With Microsoft buying up fuel cells from the company, it could be a significant step toward the company setting up its own plant in Wyoming, Collins said. He explained that it wouldn’t be from the demand of the pilot project, but instead the potential followup demand. The way Collins sees it, Microsoft may transfer what it has learned at Dry Creek to other fuel cell data centers tying in directly to natural gas sources, for instance.
Because of the intensive electricity use by data centers, it could make more sense to take them to the source rather than routing the source to them through expensive transmission lines.
"What Microsoft shared with us is that the reliability of the electric grid is not high enough to support the continuity of their operations," Collins said, adding downtime because of a grid shortage is expensive to them contractually. "If they could be close to the resource, that’s a much more secure energy configuration for them. It helps the performance and economics of their business."
Not only that, but all they need to do is run fiber to the facility and generate electricity on site instead of the massive, multi-year project of getting new transmission lines to an area. Collins estimates annual energy savings at about $1.7 million from such a configuration, only taking into account Microsoft’s ability to sell waste CO2 into Wyoming’s pipeline to be used in enhanced oil recovery.
It is possible that at the end of the demonstration, Microsoft will relocate what it doesn’t donate to UW, Cheyenne and the Board of Public Utilities to a stranded gas site and have need of more fuel cells. This could open up the regional market for FuelCell Energy, pushing them to establish a manufacturing and assembly facility valued between $20 million and $100 million that could support 50-150 jobs.
At least for Collins, he also sees the Data Plant as an intriguing way to secure research dollars. Having a one-of-a-kind facility — the kind the federal government is unlikely to fund — will be likely to help catapult money invested in research and development in the state.
Feeding a tech giant
Microsoft displays open enthusiasm for the Data Plant for both cost savings and environmental awareness in the future.
"Electricity is one of our largest operating costs, so we expend significant efforts on strategies to reduce the amount of electricity that we consume and on finding innovative ways to drive down those costs," said Brian Janous, utility architect, data center advanced development at Microsoft. "Off-grid data centers like the Cheyenne Data Plant have the potential to reduce our costs if we can deploy this sort of concept at scale and if we can demonstrate that we can meet the service requirements to ensure reliable service for our customers."
Janous added that research like that done at the Data Plant will help quantify the possibilities, and he sees plenty of potential in the collaboration with UW and Western Research Institute. Originally, Microsoft has a similar project planned in the San Francisco Bay area before Wyoming swooped in on the project with a viable alternative and an efficient timeline that impressed Microsoft, according to various sources.
The possibilities are practically limitless, when all angles are considered, and span many industries. All from a bed of fertile Wyoming ground — or at least wastewater.
"Our goal with the project is to show that the concept is possible and will support more pervasive use, enabling greater flexibility for siting and powering future data centers," James said. "Our hope is we will be able to replicate this model globally."
Wyoming Business Report Staff Writer Mark Wilcox lives and works in Wilson.