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by Craig ShieldsPosted on Posted in Renewables - Business

I urge readers to go through this excellent article explaining the costs of various means of generating electrical power.  This is a wonderful presentation of the most important ingredients in the calculus that we would like to think our leaders employ in establishing public energy policy.

To present a few of the basics on electric power:

  • The availability of renewables fluctuates during each 24-hour cycle, and thus it’s normally assumed that they are inappropriate for providing baseload power.
  • The cost of building the plant is independent of the cost of the fuel to operate the plant.
  • Where solar and wind can be switched on and off in seconds, fossil fuel and nuclear plants cannot.
  • The cost of pollution needs to be included in the calculations.

While I don’t dispute any of this, there are important aspects of the discussion that I feel need to be brought forward:

• The reason that we believe renewables cannnot provide baseload power is not intrinsic to the generation method per se, but to our perceived inablility to store energy inexpensively. However, molten salt technology, which stores energy as heat and coverts it to electricity on demand, is a proven method of removing this objection. I urge readers to note the work of Ausra, the US leading solar thermal company, based in Northern California. Yesterday, I had the pleasure of interviewing Dr. David Mills, the company’s founder, in preparation for my book on renewables.

• The actual cost of building these plants is almost never anywhere near the projected budget.  Readers may want to Google “nuclear plant cost overrun,” and read a few of the 54,700 articles they’ll find on the subject. Here’s one that refers to a certain nuclear project as “satanic,” based on the actual amount of the overrun ($6.66 billion). The Florida utility, FPL Group, now estimates the cost of building a new nuclear power plant at over $9 billion, nearly double their previous estimate.

• The nuclear industry and its lobbies have carefully confused us about the costs and safety of shipping and storing nuclear waste, which remains dangerous for as long as one million years.

• As noted, the author of the article above mentions the cost of the pollution, but does not suggest any real way of quantifying it. While I’ll grant that this is not a straightforward issue, it’s really crux of the matter.

As I’ve written many times in the past, if the price we pay per kilowatt-hour of electricity (or for a gallon of gasoline) included the cost of addressing the lung disease and long-term environmental damage to our skies and oceans, the math would be changed completely. Society’s desire to continue to mine, process, ship and burn coal and oil would be gone in the blink of an eye.

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by Craig ShieldsPosted on Posted in Renewables - Business

I was just advising a friend on the development of a cogent business plan by which his energy storage invention can for monetized, emphasized in my 25 Tips for Renewable Energy Businesses.  I reminded him of these five central points:

  • Demonstrate an ironclad understanding of key industry trends.
  • Lay out an effective and efficient marketing plan.
  • Articulate your precise positioning statement vis-à-vis your most important competitors.
  • Present a credible cash flow projection based on realistic sales projections and cash burn-rates.
  • Show investors a full ROI analysis and exit strategy.

It’s funny to me how often I encounter the “build it and they will come” approach to business.  As a marketing guy, I’ve been vigorously recommending against this tack for decades — and nowadays, of course, I feel even more strongly about the matter.  Investors want to see a clear and compelling business strategy by which an idea can fill a gaping unmet need in a well identified target market — and do so profitably. 

Again, I’m happy to review any cleantech business plan with no cost or obligation, and provide high-level comment.

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by Craig ShieldsPosted on Posted in Renewables - Business

PhotobucketI come across a great number of business plans each week, each soliciting investment in some aspect of clean technology — usually electric transportation or some form of renewable energy.  And in near every case, I find that a “second set of eyes” should review the text before it goes out to potential angel investors or venture capitalists. Almost without exception, I come across typos and grammatical errors that should be fixed — sometimes dozens of them. See my “25 Tips for Renewable Energy Businesses” for more on this.

I hope I can say this without offending anyone. At the base of it all, I’m really a professional writer by trade (direct mail copy-writing, blogging, research reports, etc.) and I know when I reread my own material I find outright errors — and, maybe more commonly, things that could be presented more clearly and professionally. (By the way, I don’t have these posts proofread, and I have no doubt that there are mistakes that get by; as a reader, I hope you won’t be shy about commenting when you come across errors.)

In addition, of course, business plan authors would be well-advised to request a second opinion on content: market trends analysis, sales and marketing plans, cash-flow analysis, etc.  I can tell instantly that many of the plans I see will never receive funding (or at least should never) due to a core misunderstanding of the marketplace. 

In any case, I’m happy to review any cleantech business plan with no cost or obligation, and provide high-level comment.

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by Craig ShieldsPosted on Posted in Renewables - Politics

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What happens when an irresistible force meets an immovable object?  This paradox is most often discussed in the context of God’s omnipotence (“Can God create a stone so heavy it cannot be lifted, not even by God Himself?”).

I’m reminded of this ancient philosophic conundrum when I contemplate the future of the energy industry. The “Conference of Parties” (COP-15) summit is now only a  little more than a month away. . . and world-renowned economists are calling for it to create a market worth $1 trillion. . . per year. . . for decades. And to me, trillion dollar markets call to mind the notion of an force that is certainly very large indeed, if not irresistible.

Yet if there were ever an immovable object, it would be the traditional energy industry, dominated as it is by oil and coal.

I presume there are at least a few truly progressive, independent and honest people in Washington who are trying to stand up on our behalf against the force of the fossil fuel industries. Yet they are utterly powerless to defend us from the atrocities of these corporate giants. Want proof? We just came through eight years of an administration that consistently voted against funding of the development of lithium-ion batteries, against fuel efficiency standards, against mandates on renewable portfolios, against enhanced geothermal, and against the extension of tax credits for renewables. Looking for an immovable object? You just found one.

I know that sounds pessimistic, though my aim is not to depress readers. I don’t think of myself as a cynic; I think of myself as a pragmatist. And it’s that spirit of pragmatism that provides the motivation by which I write on this blog every day and spend a few hours on my book on renewables; it’s really all I can do to inform and, I hope, to inspire readers to get involved themselves.

In any case, I suppose we’re all about to see what happens when an irresistible force meets an immovable object.

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by Craig ShieldsPosted on Posted in Renewables - Politics

Here is guest blogger Mike Brace’s letter to his representative Geoff Davis (R-KY) on the Obama Administration’s choice of projects that received funding in this round under ARPA-E.  You’ll notice that he shares the many of the same sentiments that I wrote about yesterday.

 

 

Hon. Geoff Davis,

Geoff, I don’t know if you were aware of it but the DoE, ARPA-E has selected their grant recipients for this last round of funding and (to put it bluntly) you, I, the state of Kentucky and almost every American taxpayer got screwed.

If you recall, you wrote a well-versed letter on our behalf to ARPA-E expressing support for our hydrokinetic project, one of which is specifically designed to generate literally millions and millions of kilowatts based on the run-of-river current flow in the Ohio River. We all thought our technology to be a good fit for this ARPA-E grant of which I speak (DE-FOA-0000065) as it was specifically set up to do three things:

•           Reduce GHG and Carbon emissions

•           Enhance energy security

•           Restore science and technology leadership to the private sectors of America.

More specifically, none of this was to be done within the halls of our national federally funded laboratories, it was supposed to wean us off burning fossil fuels over due time, and (most importantly) it was to support technology that creates a lot of jobs and in a timely manner (24 to 36 months). This was spelled out in black and white so to that end we spent a great deal of personal time and money to apply for this grant.

With the exception of about $30M, none of this ARPA-E grant neither funded technology that is even remotely aligned with these goals, or (for the small share that they did fund) they gave the lion’s share to universities, gas/oil/car companies (or to national laboratories) all of which are already very well funded and shouldn’t have to ask for this kind of funding in the first place. It begs to be asked: what have they been doing for the last 20 years if not this?

I have attached the published list of recipients for the $151M that was given out for your review, and you can map out the distributions any number of ways, but I can break it out as follows:

Directly (or indirectly) a lot of the funded was divided up as follows:

•           $43M directly to universities (none in KY; and if you think that this amount will create in-so-much-as one additional job in this country think again)

•           $27.3M to Gas, Oil or Automotive companies (none in KY)

•           $15M to national DoE funded labs (none in KY)

Then, contrary to what they said they wanted to fund, most of the dollars were allocated to the following technologies:

•           $41.4M to Biomass fuels/technologies (which has no hope of displacing oil on a national level, still propagates internal combustion engines AND does not burn GHG or Carbon free)

•           $33.3M to Advance Battery Technology/Energy Storage (even if it offers any hope of being “transformational” none of them has a prayer of getting out of the lab in 36 months, not a one. And, aren’t we funding these already through other means?)

•           $15M to Building Efficiency/Technologies (I can’t help but ask “what’s transformational about that?” And who benefits? The power companies? The consumers? Public rates have never gone down despite the incredible amount of conserving already being done. Who are we helping?)

•           $11M to 5 different Carbon Capture projects (not a penny to KY or W VA, and [worst yet] this does nothing to reduce GHG or Carbon emissions, it only makes it worse. In the end it only stashes this problem away for our grandkids to figure out a way to deal with it.)

•           $10.2M to Gas/Oil/Automotive companies and their affiliates (didn’t the US Government already give them funds to help them become more ‘transformational’? How did these even get in there?)

Of the $151M handed out, only about $9.0M went to truly transformational technology, through private companies and towards technology that can possibly be mainstreamed in less than 36 months. Sadly, only $21M went to Wind, Solar and Geothermal energy technologies. Besides geothermal energy (which is spotty at best and not very scalable) none of these others can claim the peak performance power generation 24/7/365 that hydropower can. But here is the part I don’t understand: Not a dime went to hydropower or hydrokinetic technologies. Not one dime. (And I know that, besides ours, there were several others on the table worth considering.) We were very dissapointed in that fact.

Geoff, ARPA-E did announce that they will come out with another round of requests for funding proposals and [rest assured] that if we qualify for what they are asking for, we will pursue them as well, so please let this letter serve as a heads-up as a request for further support (if we need it). But, as someone desperately trying to believe in our government, and the choices that it makes for the welfare of its citizens, our group feigns to find anything good to say about this gross misuse of trust in those trying to make America a world leader in clean energy and advanced ‘transformative’ technology. We had so hoped it wasn’t going to turn out as it had. We are upset; you should be too.

A friend,

Mike Brace
Partner, EV World & Assoc, LLC
techeditor@evworld.com

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by Craig ShieldsPosted on Posted in Renewables - Politics

I must say that I’m disappointed in this list of clean energy projects that the Obama Administration is funding with its stimulus money under ARPA-E. I use the word disappointed, a considerable understatement, insofar as I promised some of my colleagues that I wouldn’t make a big scene on this issue.

The list seems to contain very little that we were hoping for, and were told that it would feature, i.e., transformative technologies in replacing fossil fuels that would offer near-term results in the real world.

What we see in huge supply are:

Biofuels. This is a poor idea that doesn’t scale well. Even if it were a good way to go, there is no way to create biofuels in sufficient volume to make a meaningful difference in replacing oil. And, as I’ve often asked, why continue to burn hydrocarbons? If we’re going to clean up our processes of generating and consuming energy, why not choose processes that don’t release CO2 and other noxious compounds?

Clean Coal. The processes of sequestering the offending outputs of burning coal are expensive, and riddled with technical issues. Can’t someone stand up to the coal industry and say no to this incredible waste of money and time?

Projects given to government laboratories and universities. Both are known for glacier-like progress through intractable bureaucracies.

What we see little of are the technologies that actually replace fossil fuels and offer the promise of clean energy, like hydrokinetics, solar thermal, geothermal, etc. As I point out in my upcoming book on renewables, there are many fantastic ideas that are already proven within these arenas, the progress of which could be greatly accelerated with funding.

Those of you with naughty kids know what I mean with the term disappointed. Sometimes the best response to misbehavior is not anger; it’s an appeal to a sense of shame. Of course, that implies the possibility of a sense of shame; there are those who say that the corruption in the process is so complete that the perpetrators are incapable of that emotion. I won’t take a stand on that; I simply repeat: Guys, I’m really disappointed in you.

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by Craig ShieldsPosted on Posted in Renewables - Science

PhotobucketOccasionally readers take me to task for glossing over the important concepts of the day, leaving people to research for themselves the terms that I bandy about as if they were household words. Ocean acidification is a good example. Yet I am by no means an expert on this, and so I can do little more than to point readers to any of the hundreds of articles that have been written on the subject. Here, e.g., is the Wikipedia treatment.

In essence, rising levels of CO2 in the atmosphere causes more CO2 to be absorbed into the oceans, which in turn causes a complicated set of (mostly) unwanted chemical reactions, most directly the formation of carbonic acid. This affects the survival of calcifying organisms, damaging corals, shellfish, and many other lifeforms that maintain the delicate balance that is the ocean ecosystem.

What makes this phenomenon of particular importance is the fact that it is not disputed. As discussed in my upcoming book on renewables, Big Oil is working hard to obfuscate the global warming issue. However, there is no doubt whatsoever that rising levels of CO2 in our atmosphere are causing long-term environmental damage. Thus ocean acidification renders moot any controversy that the oil companies are working so hard to generate about global warming.

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by Craig ShieldsPosted on Posted in Electric Vehicles

PhotobucketThe 2009 “Business of Plugging In” conference also featured a great deal of discussion on the readiness of the utilities to support EVs. Although some people were horribly cautionary and indicated that this was a major impediment, a few key speakers cleared the matter up nicely:

EV’s are generally charged at off-peak periods when the power is usually discarded anyway. (Approximately half the electrical energy generated each day is wasted because it is not used and cannot be stored cost-effectively.) The opportunity to sell power that is otherwise thrown away provides additional revenue for the utilities at very little cost, which is, of course, a help rather than a hindrance.

Most people initially will charge at 110 volts and 15 amps.  This is the power of a hair dryer, and will put very little strain on the grid.  Only over time will a sizeable percentage of people upgrade to more robust chargers that will shorten the time necessary to charge their cars.  But one astute person asked, “If you start charging your car at 11 PM, how important is it to you that’s it’s fully charged by 1 AM?”  This slow migration to fast charging will provide ample time for the utilities to prepare.

Most of the audience came away with the (fortunately correct) idea that there is a natural fit between the development of the EV, the grid, and the increasing adoption/demand rate of EVs that we see from the consumer.  None can proceed without the other two.  Yet there seems to be a unforced harmony between the growth of each one. 

And here’s another piece of good news from the conference.  One elderly corporate speaker said to a standing-room-only break-out session of about 400 people, “We had EV conferences like this one a few years ago, and we were lucky to have 10 people in the room.  Take a second and look around.”

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by Craig ShieldsPosted on Posted in Electric Vehicles

PhotobucketConsidering all the writing I’ve done on the EV adoption curve over the past 18 months or so, I was interested in the immense amount of discussion on the subject at the “Business of Plugging In” conference in Detroit earlier this week. Here are a few comments, for what they’re worth.

I noted a great deal of speculation about “range anxiety,” i.e., dread of running out of charge away from home or a charging station. There is no doubt in my mind that, until opportunity charging can be made fast, convenient and ubiquitous — a process that will certainly require many decades — there will be some people who will cling fast to their gasoline-powered cars (at least until the demand for gas goes so low that it is no longer supplied).  Having said that, the EV owners I’ve spoken with say that they got over this anxiety fairly quickly. You simply have to take a moment and plan ahead to ensure you’re not taking a chance of running out of charge. They say that it’s not altogether different than driving with gasoline; you need to be aware of what that needle reads and plan accordingly.

Another point that I found valuable was the reminder that the communications industry had estimated an approximate 2% penetration of cell phones. They had somehow missed the fact that once people have them, use them, and tell their friends about them, there is a very direct route to everyone’s wanting one.

The case here, I believe, will closely parallel cell phones.  EV technology costs are falling, performance is improving, wars in the Middle East are raging, and CO2 levels are rising.  I really don’t know what could happen to make this migration happen any faster.

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by Craig ShieldsPosted on Posted in Electric Vehicles

PhotobucketAnother benefit of attending the “Business of Plugging In” conference was the opportunity to reconnct with old friends, and to conduct interviews so as to keep my book on renewables moving forward.  Brian Wynne, president of the Electric Drive Transportation Association (EDTA) in Washington DC was good enough to spend an hour with me after his excellent job in moderating a panel discussion on EV migration.  

In the interview, he helped me to understand many of the complications that our democracy adds to the puzzle of renewables and electric transportation, mainly, the need for politicians to show short terms results (according to election cycles) — in an environment that needs sustained, long-term commitments.

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