This opinion piece from TWW’s John Karakoulakis was originally published in the Washington Examiner on February 19, 2024 and can be accessed here.
For energy and tech innovation, look to Wyoming
February 19, 2024 7:00 am
When you believe in the power of innovation, so-called problems are actually future business opportunities.
That’s the story of a pioneering company, Crusoe Energy Systems, which is using a waste product from the oil and natural gas industry to make waves in the technology sector. And it wouldn’t have happened without Wyoming’s willingness to explore bold new ideas and foster innovation.
Crusoe Energy Systems builds portable data centers that can be placed on remote oil and gas well sites. The data centers use field gas that would be vented or flared (in other words, wasted) as their power source.
This helps to solve a big problem for the technology sector. More and more people are storing data and running computer programs through the “cloud” — remote servers that connect to your laptop or cellphone via the internet. But the continued expansion of cloud computing means more and more data centers are needed, and these data centers are very energy-intensive.
The team at Crusoe Energy Systems realized that the cheapest forms of energy never make it to the grid. Instead, they are “stranded” in the remote locations where energy is often produced, whether it’s an oil and gas well in rural America or a hydroelectric dam in Iceland.
If that stranded energy could be harnessed and used to power data centers, it could provide a cost-effective way to boost the tech sector’s cloud computing capacity. Not only that, but eliminating wasted energy would be good for the environment, too.
The idea of building portable data centers, moving them around to different locations in the oil patch, and remotely connecting them to other cloud-computing facilities was not the simplest idea to sell, according to Crusoe Energy Systems cofounder Cully Cavness.
The first place to let the company test out the concept was Wyoming in 2018, Cavness said in a recent interview on 60 Minutes.
“That’s not necessarily an idea that everyone’s going to embrace automatically right off the bat before it’s been done before,” Cavness said. “Wyoming was. They invited us to come do it for the first time here. We did it at a small scale. We proved that it could work. And that helped us attract the funding and the other projects that had helped us scale to where we are today.”
The company now has around 200 portable data centers powered by 20 million cubic feet per day of gas that would otherwise have been wasted, according to Cavness. That’s the equivalent of removing the carbon dioxide emissions of several hundred thousand cars from the atmosphere every year.
More recently, Crusoe Energy Systems has taken the lessons learned from limiting wasted energy in the oil and natural gas industry and applied them to limit energy waste in the renewable energy sector. Imagine that: a tech startup with roots in the oil and gas industry teaching wind and solar developers about how to limit waste and help the planet.
It’s not surprising that a company that got its footing in Wyoming would think this way and see these opportunities. Despite the stereotype of Wyoming being a fossil-fuel state, Wyoming is without doubt an “all of the above” energy state.
What that means is we don’t see artificial dividing lines between different energy sources. They all have their place, and they can all work together.
By definition, the all-of-the-above attitude is open to new sources and new technologies, whether advanced nuclear reactors or carbon capture and sequestration.
This approach to energy and innovation is personified by Gov. Mark Gordon (R-WY), who has taken heat from left-wing environmental groups and even some members of his own party for not treating different energy sources as “good” or “bad.”
“I have spoken, and will continue, to speak to audiences inside and outside Wyoming with the message that Wyoming provides energy of all types, and that our future — America’s and the world’s — depends on all types of energy,” Gordon wrote in a recent column.
Wyoming has a proud history of being open for business for all sources of energy. If we want to secure a prosperous future for the Cowboy State, then staying open for business is the right approach to take.
John Karakoulakis is the director of the Western Way, a nonprofit organization focused on free market solutions to western U.S. conservation issues.