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Wednesday, June 28, 2006

Environmentology: Honda thinking in action

Wednesday, June 28, 2006

I live in a part of the U.S. that is at once tied to the economies of extractive industries, and perceived as the land of outdoor adventure. These two activities conflict, mightily. And they make for interesting party conversation.

Bill LeBlanc of the Boulder Energy Group (“BEG…for more”) threw his annual summer fête this past weekend – complete with volleyball net, burgers on the grill and progeny of all ages. We sought shelter from a torrential hail storm that rained down for many minutes, infusing the front porch with the pungent scent of shredded garden mint. Unlike the deluged U.S. east coast, we need the rain.

I spoke with energy folks from Architectural Energy Corporation, WellDog, Southwest Energy Efficiency Project, and ESource as well as graduates of Rutt Bridges’ Bighorn Center. WellDog based in Laramie, Wyoming, manufacturers a device that accurately and quickly identifies sources and quantities of natural gas in coal seams. (The ecological defense…if we’re going to drill, and we will, we might as well reduce the destructive practices of frac’ing and water production.) Southwest Energy Efficiency Project (SWEEP) promotes energy efficiency through legislation and outreach programs. ESource, which originated at the Rocky Mountain Institute and recently spun itself off from McGraw-Hill/Platts, serves utility clients. The engineers at Architectural Energy Corporation (AEC) advise in the sustainable built environment, and Bill’s Boulder Energy Group recently completed a review of California’s utility marketing programs and presented findings through the Association of Energy Services Professionals (AESP).

Lightheaded from half a brew and altitude, I spoke with a finance professional – who has been with several IT start-ups and is now dedicated to energy sustainability. He said progress of alternate fuels will be made in the transportation sector because of peak oil, but progress coming out of concerns for climate change will be slow: we won’t see habits change because of climate change until we are building dikes around Manhattan to stem rising tides.

I agree, though rack my brain to find a really good refuting argument, because I don’t want to agree with him...hoping for a little more enlightenment. Peak oil threatens consumption and prices – our lifestyles in the immediate. Climate change threatens the ecology by which we survive – our lives.

This past Sunday, climate change made the Parade magazine (I use the term generously) cover story: “How Climate Change Affects You Right Now.” The inside story begins “Global warming is already affecting your life…and costing you money. Why You Can’t Ignore The Changing Climate.” The list of what we can do runs the gamut of conservation, energy efficiency, voting with your wallet, and demanding that government make climate change a priority and – echoing Thomas Friedman and Tim Flannery – enact a carbon tax.

I believe, Houston, we have passed the media tipping point on climate change – just as we have passed the marketing tipping point on the environment (everyone, Wal-Mart included, wants to tell a green story.) While it may well be peak oil – and increasing petrol prices – that drives switching to alternative fuels and fuel-efficient cars, and while it may be the allure of profits in ethanol that brings along suppliers, to date, it is the loftier environment – our survival – not the price of petrol or cost of insurance, that will continue to drive marketing messages, although those marketing messages and the attendant visuals will be gleeful and sunny, and absent New Yorkers building dikes.

Take this Environmentology (“Honda thinking in action”) ad for example:

“When it comes to talking about the environment, we let our products speak for themselves. In 1974, Honda introduced the ingeniously simple Civic CVCC. World-changing for its fuel efficiency and low emissions, the CVCC demonstrated our spirited commitment to environmentally responsible technology. Many other firsts were to follow, such as the first hybrid vehicle sold in North America and the first government-certified fuel-cell car. This legacy of innovation and acting on our beliefs is what we call our Environmentology. And it’s seen in every Honda product, like the 2006 50-mpg Civic Hybrid. Honda. The Power of Dreams.”

It’s this kind of marketing, social marketing, that grabs attention and holds it. But can it hold our attention long enough for people to make the connections between our consuming lifestyles and the destruction of the environment on which we depend for survival, our lives? I remember the post-OPEC go-go 80s. Can social marketing hold attention – and influence behavior – in the face of falling oil prices and increased domestic fossil fuel exploration? Will the 21st century version of the Honda Civic CVCC endure?

That’s hard to affirm from this geographical vantage point, as gas drilling undergoes a massive boom (great for WellDog) and the likes of Morgan Stanley and Houston-based Anadarko buy up local natural gas exploration companies, because of the promise of profits (not great for Colorado). And yet another college-age petitioner with a clipboard from Environment Colorado stands on a street corner appealing to the passerby to protect the wilderness from drilling. And Colorado’s governor vetos a natural gas efficiency bill supported by SWEEP and the local utility. And coal-plants are breaking ground. And the NRC has approved a nuke plant in New Mexico (after a settlement with the state...) And the CEO of Western Gas tells the local paper: “It is up to the American people. The American consumer needs to decide how much they want that balance between their energy consumption and lifestyle and preservation of pristine areas like [the Arctic National Wildlife Refuge].” The CEO, Peter Dea, is an avid outdoorsman. I just wish Dea had recognized the choice is between lifestyle and protection of the umbilical cords of life itself, not protection of pretty pristine places.

The conflict between lifestyle and life…it does make for interesting party conversation.

Other goings on this week:
For Good or Ill, Ethanol Boom Reshapes Heartland Economy in The New York Times
Wal-Mart, Health and the Environment in The New York Times
Colorado study on energy efficiency finds it’s good for business (you don't say!)
NPR reports that GM’s solution to slow Hummer sales is the Mileage Maximizer. For $200, the “Maximizer” brings fuel efficiency from 0mpg to 5mpg, NPR jokes.

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Tuesday, June 27, 2006

Biofuels Activity in Australia

Recently Clean Technology Australia hosted a cleantech dealer forum to brief institutional investors by CEO presentations on three listed Australian Biofuels companies with interests in Australia and Overseas. The CEOs and companies were:

Australian biofuels companies are benefiting from the increasing demand for alternative fuels as a source of energy for transportation and electrical generation. No doubt you already know that demand is being driven by a combination of factors such as climate change, high oil prices, market and government incentives or subsidies and increasing oil imports. Presenter’s explained the national and international market opportunities, the maturing of the industry, the technologies and the investment rationale including debt and equity with the prospect for solid growth and returns.

I've summarised a few of the key points presented below - but you should be able to find more on each of the companies at the above websites and via their ASX profile. For US readers you may find it interesting to see the external perspective on the US market.

· When compared with the usage of biofuels such as ethanol OS, Australia is at a very early market development stage. Ethanol makes up 23% of fuel market in Brazil, 3.2% in US and 0.3% in Australia. US market for biodiesel is mainly made up of smaller producers, whereas Australia is now becoming dominated by larger production facilities. There is a lot of opportunity to aggregate production, vertically integrate feedstocks in the US.

· Availability of feedstock is a large factor in how large production of biofuels in a market can grow. In the US production is supported by 80mT soy crop in US. In Australia the market can grow to around 600-750 million L based on tallow and other waste oil feedstocks.

· Oil price has significantly climbed in last year and looks set to remain high. Tallow and oil seed commodity prices are generally in decline but the availability of tallow is expected to tighten.

· Companies are looking to increase their control of the oil field - this is resulting into forays into the oil crop production market. Interestingly the oil crops in developed countries need not necessarily compete directly against food crops.

· Technology has moved from liquid catalyst to solid catalysts to improve the quality and yields from the product. There is also likely to be a shift to high quality product as the off take shifts from the farmyard tractor to $10m locomotives.

· Logistics are some of the key cost challenges that have to be considered in the construction and siting of production facilities. This presents limits to the optimal scale of plant to be developed eg 45 Million L in Australia and 250 Million L in US

· Cost Structure is US$2.73/gal cost reduced by US$1/gal Blending rebate vs. current oil price of US$3.50/gal for mineral oil. Current margins in the industry look to be around 27%-29%. 75% - 77% of cost is the feedstock price. UK has rebate of 20p per litre. Australian biodiesel market mechanisms include the 38c/L producer’s rebate.

· The varying maturity and regulation in US vs. Australia is resulting in varying financial environments for raising capital. There is a significant ability to raise debt to finance capital upgrades or purchases in the US where as in Australia debt finance is most difficult but there is significant interest in the equity markets.


For a detailed summary which includes a link to the presentations visit the Clean Technology Australia Website

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Nick Bruse is the General Manager of Clean Technology AustralAsia Pty Ltd, the organiser of the AustralAsian Cleantech Forums and Dealer Forums, and the leading advocate of Cleantech in Australia. Nick does a weekly blog column on Cleantechblog profiling innovative Australian cleantech, energy, water and environmental technology companies.


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Friday, June 23, 2006

Recently Licensed Gas Centrifuge Facility for Uranium Enrichment

I recently picked up a news article on the licensing by the Nuclear Regulatory Commission of what's billed as the first major nuclear processing facility permitted in the US in 30 years. Announcement here. Called the National Enrichment Facility, it will be the only privately owned source for commercial enriched uranium. The license is issued "to Louisiana Energy Services (LES) to construct and operate a gas centrifuge uranium enrichment plant in Lea County, N.M." LES license application and environmental report.

Description of LES from the NRC's website, "The LES partnership is made up of limited and general partners consisting of Urenco, Exelon, Duke Power, and Entergy. The partnership intends to use Urenco's sixth generation gas centrifuge technology that is being used in Europe. Urenco has a capacity of about 20 percent of the world's enrichment market." Announcement from the NRC here.

Each of the articles announced opposition from NIRS, where you find a bit of historical color. Apparently according to NIRS, Louisiana Energy Services originally tried to license a facility in 1989 in Louisiana, and pulled the application it 1997 when the NRC found that the plant siting was "environmental racism" as the site was next to poor, rural predominantly African-American towns. A full history of LES and the application process according to the NIRS is on their site here. As you might imagine, they are not particularly positive about the project or the firms behind it. Each of the press releases include US minority partners Duke, Entergy, and Exelon, but the company is a consortium controlled by European nuclear industry heavyweight Urenco, a multi-national nuclear venture. And Urenco's annual report lists their ownership in LES at 100%, after buying out Westinghouse last year, so I'm unclear exactly what interests US concerns have in the venture.

The site for the project is http://www.nefnm.com, and states that construction will begin in 3Q2006 and with first production expected 2008/09. Urenco, who is also providing the technology, operates three similar facilities in Europe, and makes and sells the centrifuges.
Urenco is owned by British Nuclear Fuels (a UK government entity) a Dutch government entity, and a partnership of E.On and RWE from Germany. In 2005 it had annual revenues of 730 mm euros, operating cashflows of 460 mm euros, and claims 20% of the global uranium enrichment market, apparently a significant portion of that already in the US.

The project is slated to cost $1.4 Billion. With an equity base of only 600 mm euros, and an asset base of 2 billion euros, I haven't figured out how Urenco is financing the project, but it with a single A credit rating, tremendous cashflows, and deep pocked owners, it looks like they would likely have the wherewithal to accomplish it.

I am one of those that views nuclear as relatively clean power source, when compared to breadth of the upstream environmental footprint of coal, gas, hydro, etc. And given that our power industry has been looking at nuclear as a key growth fuel of the future, I can't help but think this project is a big plus for the industry. In addition, it seems from Urenco's annual report, that US utilities are already buying from Urenco, and this facility is simply onshoring the production of enriched uranium fuel supplies, bringing more investment capital into a critical industry in the US.

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Cleantech Investment Forum in Palo Alto, California

Announcement of an interesting looking Cleantech forum coming up in Palo Alto, put on by the Asia America MultiTechnology Association.

Clean Technology: Investments, Technology, and Policy

Date: Tuesday - June 27, 2006

Time: 6:00PM

Cost: $25 for Members, $45 for non-Members; +$15 after June 21th; +$15 at the door

Location: Ming's Restaurant - 1700 Embarcadero Road Palo Alto, CA

RSVP: https://www.123signup.com/register?id=qtkbk

Moderator:John Denniston - COO and Partner, Kleiner Perkins Caufield & Byers
Speakers:

Vikas Desai - General Manager, North America. SunPower Corp

Bryant Tong - Managing Director, Nth Power

David Pearce - President & CEO, Miasolé

David Wooley - Vice President, The Energy Foundation

Clean Technologies have the potential to reshape our future. Now the 5th largest category in venture investments, and out-performing the market by a ratio of 3 to 1, clean technologies are gaining huge attention while addressing some major global environmental issues. Energy, manufacturing, nanotechnology, transportation, water and air quality, automotive, and semiconductor industries are rapidly joining the "cleantech" movement. Rising energy prices, dependence on oil, and the rapid development of China and India are also accelerating the demand for innovative solutions to address these issues. In 2005, China became the number one investor in solar technology and its largest IPO was a "cleantech" company.

Is the U.S. getting left behind on this opportunity? Is "cleantech" just a buzz word or is it the future's most important technology? What policies are affecting the market and potential for new technologies to emerge? What kinds of returns are expected? Is this the perfect marriage between business and a lasting, positive impact on society and the environment? Please join us as we discuss the investment, technology, and policy behind Clean Technology, and the impact on our future.

Contact Information Name: Paul Leow Email: aama@aamasv.com Phone: 650.738.1480

Speaker Biographies:


John Denniston - COO and Partner, Kleiner Perkins Caufield & Byers - John came to Kleiner Perkins Caufield & Byers from Salomon Smith Barney, where he was a Managing Director and head of Technology Investment Banking for the Western U.S., and also served on the Investment Committee for Salomon's direct investment venture fund and its venture capital fund-of-funds. Prior to Salomon, John was a Partner with the law firm Brobeck, Phleger & Harrison, where he was the head of Brobeck's Venture Capital Practice Group, Co-head of its Information Technology Practice Group and a member of the Investment Committee for its venture capital fund.

Vikas Desai, General Manager, North America. SunPower Corp - Vikas has extensive leadership experience in the management of hi-tech power products and product teams. Having started his career as a design engineer, he has since managed product, operational and customer issues in almost every part of the world, dealing with some of the world's largest companies in variety of manufacturing sectors. In his last role, he headed up the Global Product Management and Product Support Group at Emerson Electric's industrial automation division, Control Techniques where he was responsible over 11 product lines with total annual revenues > $250 million. Vikas has a Bachelors degree in Electrical Engineering and a Master's degree in Power Electronics. In 2004, he graduated from the MBA program at the Haas School of Business, UC Berkeley.

Bryant Tong - Managing Director, Nth Power - Mr. Tong has led Nth Power's investments in Accelergy, NanoGram Corporation and Envenergy, Inc. (merged with Encorp, Inc.) and he serves on the board of each of these companies. Mr. Tong also led Nth Power's investment in NanoGram Devices Corporation and later successfully sold the company to Wilson Greatbatch in March 2004. Previously, Mr Tong was founder, President and CEO of Pacific Venture Capital, LLC (PVC), the venture capital arm of the PG&E Corporation. At PVC, Mr. Tong led investments in the energy and telecommunications sectors. A native of San Francisco, California, Mr. Tong received his Bachelor of Science in business administration from the Haas School of Business at the University of California, Berkeley. Mr. Tong is a member of the American Institute of CPAs and also serves as a member of several industry advisory boards including the Energy Venture Fair and the Golden Capital Network. Mr. Tong also founded and chairs the China/U.S. Energy Efficiency Alliance.

David Pearce - President & CEO, Miasolé - Mr. Pearce has over 30 years of broad-based business, sales, operations and financial management experience in both private and public high-technology companies. He has been at the CEO level for the past 18 years. Mr. Pearce is a serial entrepreneur, having founded four venture-backed companies. Prior to founding Miasolé, Mr. Pearce founded two companies focused on the optical communications industry; OptCom, Inc. in 2000 and SciVac, Inc in 1997. OptCom manufactured precision thin-film optical filters while SciVac designed and manufactured vacuum-deposition equipment. From 1992 to 1994 Mr. Pearce, served as president and co-founder of JTS Storage, a pioneer in the design and production of hard disk drives. Mr. Pearce holds a Master of Business Administration from the University of Texas, Austin, and a Bachelor of Science, Industrial Management, from Georgia Tech.

David Wooley - Vice President, The Energy Foundation - David Wooley currently serves as Vice President of the Energy Foundation, with responsibility for a $17 million portfolio of grants on domestic energy policy reform. In 2004-5 he led a team that helped develop the greenhouse gas emission reduction target for California announced by Governor Schwarzenegger on June 1, 2005. From 1999-2003 he served as the Director of American Wind Energy Association’s Northeast State Policy Project. David was appointed to Governor Pataki's Greenhouse Gas Taskforce in 2002. The recommendations of the task force led to the NY Renewable Portfolio Standard and the Northeast states’ Regional Greenhouse Gas Initiative (RGGI). David previously served as Professor for Environmental and Energy Law, and as Executive Director to the Pace Energy Project, at Pace University School of Law. David was lead counsel for a coalition of national and state environmental groups in the electric utility restructuring proceedings before the NY Public Service Commission. One outcome of the cases was the establishment of an $87 million/year fund to support energy efficiency services and commercialization of renewable energy technologies.

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Thursday, June 22, 2006

Clean Tech Goes Mainstream

EnergyBiz Insider says:

"Clean technology is in vogue. Solar panels and wind turbines are hotter now than ever before. Green energy investments throughout North America climbed to $1.6 billion in 2005, 43 percent more than the year before.

Such venture capital is on the rise because of high energy prices, the concern for air quality and technological advancements. But the major catalyst that will ignite future development will be the Energy Policy Act of 2005 enacted last fall. Seed money has been holed up since the 2001 recession. But, now with a good economic prognosis and some lucrative tax incentives, capital is flowing into the green arena." read more...

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Wednesday, June 21, 2006

Seven Participants Complete Negotiations for International Fusion Reactor

The research ministers of the seven international parties engaged in the $10 billion ITER fusion project have met in Brussels to confirm the agreements negotiated over the past year, following the selection of the construction and operation site at Cadarache in southern France (see Superconductor Week, Vol 20, No. 12).  Since the decision last June to locate the project at Cadarache, the seven parties (the EU, Russia, Japan, China, India, South Korea and the U.S.) have been working on agreements that would bring to an end a complex — and at times acrimonious — three year long negotiation process.  Now each partner in the project must confirm the adoption of the agreement according to laws and practices of their respective governments.

For the EU, the host and largest financial contributor to ITER, this means that the Council of Ministers will be asked to adopt a decision endorsing the agreement.  The EU is represented by the EURATOM Community.  ITER’s Director General, Kaname Ikeda, hopes all parties will have completed the process by the end of 2006, which, in tandem with the completion of the process of gaining all necessary construction permits at the site, will mean actual construction can start in 2007.

“This is a truly crucial moment, for the ITER project and for global scientific co-operation in general,” said European Science and Research Commissioner Janez Potocnik, who hosted the meeting. “Together we are forging a new model for large-scale global scientific and technical cooperation.”

EU will provide 40% of the 5 billion euro ($6.4 billion) construction costs for ITER, with the other partners paying approximately 10% each.  The EU is also paying 26 percent of the 5 billion euro operating costs.

In other news in the fusion effort, and paralleling the international progress in pursuit of the world’s largest fusion project, the Institute of Plasma Physics at Hefei, under the Chinese Academy of Sciences (CAS), has successfully completed the first tests of the Experimental Advanced Superconducting Tokamak (EAST) fusion experiment.  The final assembly of the device is complete, and it is now undergoing vacuumizing, cooling, and galvanizing experiments.  The first plasma discharge is scheduled for July or August.

EAST started overall assembly in 2003, and was developed as an upgrade from HT-7, China’s first superconducting tokamak completed in 1990.  The budget for the device was just 300 million yuan ($37 million) — a small fraction of the cost of the multi hundred million dollar price tag of similar devices being developed elsewhere.  

If the device succeeds, China will become the first country to build and successfully demonstrate a superconducting tokamak fusion device.  The goals for EAST include exploring and demonstrating steady-state operation of a tokamak and generating plasma currents of 1MA.  With a capability for pulse times as long as 1,000 seconds, the device will also be used to investigate particle and heat flux handling on a time scale much longer than the wall equilibration time.

“The EAST project research results will be significant for the International Thermonuclear Experiment Reactor, or ITER, in terms of basic research both in engineering technology and physics,” said Wan Yuanxi, General Manager of EAST. “The technology developed for EAST will allow fabrication of ITER parts in China.”

India, the most recent addition to the ITER partnership, has been awarded the critical role of building the cryostat (refrigeration enclosures for the superconducting magnets used in the devices) for the massive device.  China is moving ahead with large-scale fusion research projects on a number of fronts.  Fusion may or may not prove to be a technologically feasible source of virtually endless energy, but I am continually amazed at the energy and sacrifice that poorer nations are capable of in pursuit of alternative ways to fuel their growth, environmental stability, and energy security.

Mark Bitterman, Executive Editor, Superconductor Weekhttp://www.superconductorweek.com

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“Marketing Markets”

Wednesday, June 21st

I had an insightful conversation with Bob Gower, the head of marketing at EPRIDA, a start-up in San Francisco. But I’m not, just yet, prepared to divulge in detail. On the tip of it, Gower is addressing the tough questions of segmentation and message. He’s redesigning the website (it’s third iteration), and he’s about to head to EPRIDA’s first trade show. In the guts of it, he and his team are building an organization. We touched on the roles of technicians, scientists and engineers in relationship to marketing and corporate communications. We talked about raising capital from investors versus selling product to consumers. It’s all in the life of a start-up marketer. I’ll come back to Gower soon.


An article by Gary Gardner in the May/June 2006 issue of World Watch magazine may pique your interest. Called “Marketing Markets,” it breaks down the iconographic “market.”

“In February, U.S. Vice President Dick Cheney dismissed suggestions that a gasoline tax could help cure America’s addiction to oil. 'The president and I…are big believers in the market,' Cheney declared, offering his preferred solution to the problem. Cheney’s input invoked one of the most powerful icons in modern politics: “the market” has achieved mythic status as a larger-than-life, quasi-magical, all-knowing force that can cure most any economic, environmental, or social ill. But this view emerges from an exaggerated or oversimplified understanding of its central features. Misrepresented and oversold, “the market” is pressured by political and business leaders to promise more than it can deliver—in the process obscuring its true value to modern societies.”

Gardner dissects a few of Cheney’s sentences around the magical market; he plays out “the reality behind the rhetoric,” and writes:

“One of the strongest selling points for free markets is that they offer consumers extensive choice. The argument is seductive because human beings nearly everywhere seem to value freedom deeply. But look closer: markets today arguably offer a wide range of choice where it least matters, and little choice where consumption is more consequential.”*

Gardner concludes:

“There is no question that markets offer real benefits, and few clamor today for a return to command-and-control economies. But the wisest use of markets seems to be to allow their allocative magic and efficiency to operate within a set of political goals set by democratic societies. Pulling political gloves over invisible hands could direct those hands to operate within boundaries established by the public—and in the process, reclaim a key economic tool for serving human needs.”

Energy is (quite) consequential and political gloves (do) guide the invisible hands of the energy market. They just don’t guide them toward a level playing field for new entrants. No, we don’t have a free market, or even a true market, when it comes to energy. Nonetheless, Cheney believes “the market” will solve our addition to oil.


* A study on consumers found that for some consumer segments (those without higher education), freedom is freedom from having to choose. For that segment, choice is burdensome, not freeing. On shopping days when I am presented with three shelves of kitty litter (clumping, non-clumping, fresh-scented, non-scented) from which to choose, I feel burdened, too.

Goings on this week:

  • The Colbert Report. Stephen Colbert took a spin on GM’s $1.99/gallon gasoline promotion in his “The Word” segment on June 20th. Reference to a Thomas Friedman column kicked it off. (By the by…GM is a sponsor.)
  • Chevron’s post cards by The New Yorker cartoonists. Pull ‘em out and mail ‘em!
  • Big Coal: The Dirty Secrets Behind America’s Energy Future and author Jeff Goodell in The New York Times, American Prospect, Plenty, Treehugger, Sustainablog, Natural History magazine. (No, no Wall Street Journal coverage.)

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Friday, June 16, 2006

Ten Ways to Save Gasoline and Diesel

Ten Ways to Save Gasoline and Diesel

Everyone can make a difference in achieving energy independence and a more healthy future. Consider these ten technologies the next time you select a vehicle for your fleet or personal use. All ten are important to clean transportation.

  1. Light

The less weight that you carry the better the miles per gallon. If you use a big SUV like the GM Envoy XL 2WD, your official EPA mileage is 15/19. Your mileage may vary (as in less distance, more bucks). If you use a much lighter GM Chevrolet Cobalt M-5, your EPA mileage is an improved 25/34. Less weight requires a smaller engine which burns less fuel. In their book Winning the Oil Endgame, Lovins, Datta, et al. report: “A panel of the National Academies’ National Research Council (NRC) found that...applying traditional, modest, incremental improvements, including only minor reductions in weight and drag, mpg gains of 14 to 53% would raise prices by $168 to 217/mpg.” At today’s prices, the payback for a vehicle buyer is less than three years. http://www.oilendgame.com/

  1. Aerodynamic

The Toyota Prius is more aerodynamic than a Chevrolet Corvette. Both have less wind resistance than a square box car or SUV. Wal-Mart, which is famous for saving money, has committed to double the fuel-efficiency of its fleet trucks. One way that they will do it is to make their trucks more aerodynamic. Wind skirts will be used under the trailer to significantly reduce wind resistance and reduce airflow around the trailer. Their future truck tractors will be required to be more aerodynamic and not necessarily lowest in initial capital cost.

Walmart

EPA Smartway

  1. Tires With Low Resistance

One reason that I get great gas mileage with my Toyota Prius is that it uses low rolling resistance tires. There tires also work surprisingly well when we go skiing in Tahoe, driving (carefully) on snow and ice. You can improve mileage with your current vehicle by keeping the tires fully inflated, thereby lowering rolling resistance and increasing mileage.

  1. Powertrain Efficiency

Manufactures have been improving engines and transmissions for over 100 years. Engines are now made with many improvements including improved timing, fuel mix, less resistance, and variable value timing. They continue to improve mileage with new engines that can shut-off valves when not needed. For example, the Honda Accord Hybrid's V6 engine features a Variable Cylinder Management system (VCM) that can deactivate three of the engine's six cylinders during cruising and deceleration. Also used is the continuously variable transmission (CVT) which closely matches the transmission ratios with the optimum rpm range of the engine for better fuel efficiency. Look for vehicles with better miles-per-gallon due to use of advanced powertrains.

  1. Hybrid

Hybrids store braking, downhill, and extra energy in advanced batteries and then supply the energy to an efficient electric motor. As a result, a smaller internal combustion engine (ICE) or fuel cell is used and run less often. The result is a big savings in fuel and far less emissions. An added pay-off of many hybrids is that they are computer programmed to turn-off the engine when it idles too long, and then automatically restart it when needed. Auto Express reports that Toyota insiders have admitted to a new 100 mpg hybrid with lean-burn 1.8-litre turbo engine and efficient lithium ion batteries.

How Hybrids Work

  1. Plug-in Hybrid

At a recent conference, Toyota President Katsuaki Watanabe spoke about his dream of building a car that could cross the United States on a single tank of gasoline. He spoke of the future potential of plug-in hybrids, without formally committing Toyota to build these as commercial vehicles. He did state that Toyota is increasing its research and development in plug-ins. My wife and I share two cars. On a given day, one of us never drives over 40 miles alone. With plug-in hybrids, one of us would travel all day on electricity from the grid that is stored in batteries. When we occasionally need range, a plug-in hybrid would automatically engage the engine if the batteries got low.

  1. Ethanol

When you fill your current vehicles, the odds are good that part of the fuel mix is from plants rather than oil. Energy independence is moving forward. Most California gasoline runs cleaner because it includes 5.6% ethanol. Most new gasoline engines can support 10% ethanol without modification. GM and Ford are selling hundreds of thousands of vehicles which can support E85, a blend of 15% gasoline and 85% ethanol. Soon, most cars in Brazil will run on ethanol, reducing its dependency on oil and adding jobs to its sugarcane industry.

  1. Biodiesel

Diesel engines are the standard for heavy vehicles, such as trucks and buses. Biodiesel is a blend of diesel, which is processed from oil, and fuel from biological sources such as soy or food waste. Blends of 5, 10, and 20% biofuel are popular because they run in most current diesel engines. Look for wide use of B20 in heavy vehicles.

  1. CNG

Natural gas helps achieve energy independence because it is not refined from oil. CNG burns cleaner than gasoline, ethanol and biodiesel. CNG is popular with cities and other fleets with low-emission programs. The next time you take a taxi at an airport, it may well be running on CNG. These vehicles get priority at airports. CNG is CH4. It is mainly hydrogen. In fact, most early adapters of hydrogen vehicles are CNG fleet owners.

  1. Hydrogen

Over 2,500 people daily ride hydrogen vehicles in California, using 8 hydrogen buses and over 130 hydrogen vehicles. Next time you are in the Bay Area or Palm Springs, ride on a hydrogen bus in-service at AC Transit, Santa Clara VTA, or Sunline. Hydrogen is used in fuel cells with the only emission being water vapor. It runs at near zero-emissions in advanced engines. Hydrogen fleets are cleaner than the vehicles they replaced. The 30-plus hydrogen fleets in California get their hydrogen from several sources including solar power electrolysis of water, delivered hydrogen from steam reformation of natural gas and onsite reformation. In the future, they will also get hydrogen from pipelines, waste hydrogen, biologically processed, and from wind.

California Hydrogen Report

Hopefully, at least one of these technologies will help you save fuel and emissions. Many other technologies also help. Some of the biggest early wins in saving fuel involve more time riding together and riding less. These will be explored in future articles.

John Addison publishes the California Hydrogen Report and is writing his next book, Save Gas, Save the Planet.


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Wednesday, June 14, 2006

Marketing EPRIDA’s Terra Preta*

Wednesday, June 14

I’ve been writing on this blog – directly or indirectly – about climate change (too many greenhouse gases in the atmosphere) and agriculture (too little carbon and richness in the topsoil that’s left) – and energy.

After numerous references to Natural Capitalism, I picked up the book Natural Capitalism for a re-read and re-discovered a chapter, “Food for Life” that addresses climate change, agriculture, energy and solutions:

climate change: “Farming, as presently practiced, contributes about one-fourth of the risk of altering the earth’s climate.”
agriculture: “A more subtle decline than physical soil loss, but no less dangerous, is the invisible loss of the soil’s organic richness.”
energy: “The food sector uses about 10-15 percent of all energy in the industrialized countries, and somewhat more in the United States. Despite improving efficiencies, about two-fifths of energy goes to food processing, packaging, and distribution, and another two-fifths to refrigeration and cooking by final users. Only one-fifth is actually used on the farm – half of that in the form of chemicals applied to the land.”
solutions: “Agriculture based on more natural models would feature reduced land clearance, tillage, and fertilization, higher energy efficiency, and greater reliance on renewable energy.”

A technology development company, EPRIDA, has a solution in carbon capture, carbon utilization for sustainable agriculture and renewable energy. Biomimicking an organic, closed-loop process, EPRIDA aims to take carbon from the air and put it in topsoil. One byproduct of the solution is called ECOSS (a fertilizer). Another is hydrogen (energy).

EPRIDA (“Sustainable Solutions for Global Concerns”) stands for: Earth People Research Innovation Development Acknowledgement. The company was founded “to provide a commercial vehicle for exploring innovative solutions to global challenges.”

Typical for technology development companies, EPRIDA has myriad product ideas, myriad potential markets and myriad value propositions. EPRIDA chooses to sell energy and fertilizer and carbon credits. Thus, it’s a solution. It’s not a widget; it’s not a product, like a can of soda.

I called Bob Gower, EPRIDA’s marketing director. I wanted to know what goes into marketing a cleantech solution. Bob is an MBA candidate at Presidio College in San Francisco and brings to EPRIDA a traditional corporate marketing background. How different is traditional marketing for a large established brand and marketing for a cleantech startup? I’ll fill you in next week. Until then, check out the “EPRIDA cycle” flash presentation…in Mandarin!

* Terra Preta is healthy, dark soil. On a sustainable farm, biomass is left on the ground to rot, or composted in, adding nutrients to the soil, a process that requires no energy input other than that from the sun and the work of bacteria, fungi, protoctists, and creatures of all sorts.

Other goings on this week:
Deloitte's Senior Advisor, Joseph Stanislaw, on E&ETV: U.S. must take lead in shaping international energy policy (June 14)

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Monday, June 12, 2006

Green Energy Virtual Stock Challenge- Are you the Ultimate Green Technology Investor?

Just a quick note to let everyone know that RenewableEnergyStocks.com and GreenTechInvestor.com has announced its first virtual investor contest.

The contest starts investors with $200,000 in virtual dollars to invest in green companies of choice from a list provided by RenewableEnergyStocks.com. The current stock list includes a cross section of public companies trading on OTC, AMEX, NASDAQ, NYSE as well as TSX.

Current sponsors and prizes include a ZAP® (NYSE Arca:ZP) Electric Car, and Electric Scooter, plus prizes from MicrocapTrade and Energy Hedge Fund Center LLC.

For more details check out: www.GreenTechInvestor.com

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Big Green

In the past few weeks, a couple of the world's largest corporations have released some noteworthy environmental announcements.

Two weeks ago, GE released their first Ecomagination Report. According to this report, GE is now producing over $10 billion annual revenues from environmentally-friendly or sustainable products. I'm sure there's room for debate on some of those line items, but at least at an approximate level, there's now a $10 billion company in the environmental space -- and its name is GE. Impressive, and because GE tries to dominate wherever and however it competes, their stance is bound to have accelerating impact in the business-to-business community.

Perhaps even more encouraging are the actions of the world's largest consumer retailer, Wal-Mart -- heretofore not well-known as an environmental leader. But, that may be changing. Wal-Mart's CEO Lee Scott addressed the annual shareholder meeting on June 2, and reinforced last year's announcment of emphasizing sustainability in Wal-Mart's operations. Clearly, Wal-Mart sees using less energy and creating less waste as a way to boost profits substantially. According to a few sources, however, it seems that Lee Scott sees the environment as a moral imperative, and wants his tenure at Wal-Mart to leave a legacy of impressive environmental stewardship. Let's all hope so and wish him well. If Wal-Mart puts the environment at the top of its agenda, its force in the marketplace can be awesome.

I wish that ExxonMobil and some of the bigger electric utilities would start seeing the world in the way that GE, Wal-Mart, Goldman Sachs and others are.

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Friday, June 09, 2006

California Air Resources Board to Lease HICE Vehicles

The California Air Resources Board (ARB) has posted a notice of intent to award contracts for the lease of six vehicles that will lower the cost of using hydrogen. Hydrogen will be used in conventional engines, not fuel cells. This will expand to 37 the total number of hydrogen internal combustion engine (HICE) vehicles in California.

Four of the hydrogen vehicles will be Toyota Priuses modified by Quantum Technologies to run on gaseous hydrogen. Other fleets that each uses five of these Quantum Priuses include the cities of Riverside, Burbank, Santa Ana, and Ontario. AQMD in Diamond Bar also uses five Quantum Priuses. This June 15, Santa Monica will start using five.

Two Ford E450 HICE shuttle buses will also be leased by ARB. These buses can be configured to carry 11 to 17 passengers. The E450 uses a standard Ford V10 engine designed to run on gaseous hydrogen. The Ford E450 offers a range of 150 miles. This same engine has been used in a large 40-foot hybrid hydrogen bus carrying hundreds of people daily at Sunline Transit in Thousand Palms. The range is greater on the larger bus because it uses an ISE hybrid drive system that stores braking energy in ultracapacitors.

Three public companies are competing with HICE offerings: Ford, Quantum Technologies and BMW. In the heavy vehicle space, venture capital backed ISE Corporation is also competing. A number of smaller HICE specialty integrators also have offerings.

Competition between HICE and fuel cell vehicles is lowering the cost of hydrogen vehicles. As more of these vehicles are on the road, there consumption of more fuel is lowering the cost of the fuel which in turn encourages more vehicles. One fleet at a time, the “chicken and egg” problem is being resolved. Instead we are starting to see vehicle manufacturers and hydrogen station providers engage in a race for early market leadership.

Will we see a hydrogen vehicle for under $60,000?

Complete article and links for more information:

cah2report.com


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Thursday, June 08, 2006

Mount Everest and Ethics – What’s wrong with people?

Though it’s not one of my usual energy blogs, I couldn’t pass this one up.

Below is a link to a story about a climber, Daniel Mazur, a professional guide from Summit Climb, who cost himself a chance to summit Mt. Everest last week (as well as his two paying clients, apparently) when they stopped to help a climber, Lincoln Hall, down the mountain after he had somehow been left for dead by his own party, just 1,000 feet from the summit.

Article

It’s apparently newsworthy because a few days another climber, David Sharp died at about the same altitude with dozens of people walking buy him who didn’t stop to help.

Article

Incredible enough, Mazur stated in the article that while helping Hall two other climbers passed by, and lied about not speaking English as an excuse to avoid helping.

I don't consider myself any more moral or ethical than the next guy, but I guess I will never understand some people’s concept of ethics.

When I was in my training program at Bankers Trust, fresh out of college, we were put through an ethics course. One of the ethics cases we discussed was almost verbatim this Mt. Everest scenario. The case was simple, our ethicist instructor asked us what we should do if we were climbing a peak, the only time we would ever have a chance to do it, on a trip that had cost us thousands of dollars, and we ran across a stranded climber. The case went on to describe that the climber could possibly have made it down himself, but there was a reasonable chance that they might die if we didn’t help. Our sole objective on this once in a lifetime trip was to make the summit, and we could either help the climber down, or make the summit. The ethicist then wanted us to discuss the pros and cons of each side of this ethical dilemma.

At the time I found this whole discussion quite astounding, and said so. I recall telling the ethicist and the class in no uncertain terms that this was a ridiculous scenario, as there was no ethical dilemma whatsoever, and that it was truly sick that we should be assuming there was. That I was from Texas (the only Texan in this New York group), and that I didn’t know how people did things where he was from, but in Texas we only saw one option here: stop, pick the guy up, and carry him down the mountain without another thought.

The ethicist did not seem to understand why I had a problem with our discussion. But there was no more debate after that, we just kind of went on to the next case.

Bottom line, am I missing something here?

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Wednesday, June 07, 2006

The BHAG

“OOOhh! It’s Getting Hot In Here,” sang Energy Action before delegates at the UN Climate Change Conference in Montreal this past December, “There’s too much carbon in the atmosphere.”

Speakers at a Green House Network workshop on climate change this past weekend included the youthful and energized leader of Energy Action, Billy Parish, and the beautiful, articulate–and young–Native American, Wahleah Johns, of the Black Mesa Water Coalition. (Black Mesa’s tagline is “Youth Empowerment while Building Stable Communities.” Want to break your heart? Listen to young Navajos—the five-fingered people—talk about Water and Coal on the Res.) The title of the keynote address by Eban Goodstein was “Global Warming and the Meaning of Life.” Throughout the weekend, people peppered conversations with the words ‘quality of life’–or, as a successful IT entrepreneur attending the workshop calls it, this ‘life crusade.’

Dr. Martin Hoerling of National Oceanic & Atmospheric Administration (a division of the U.S. Department of Commerce) covered the science of anthropogenic contributions to climate change–about which there is no doubt. Hunter Lovins of Natural Capitalism Solutions spoke brilliantly, as she does, about the human potential to innovate in the next industrial revolution. She can meld Al Gore- and scientist-speak with corporate-speak. Her clients, corporations, understand the financial risks of carbon and the money-saving upsides of efficiencies and getting ahead of the market. There was serious thought given to solar troughs and Stirling engines, wind, coal gasification and carbon sequestration, nuclear and negawatts, population and consumption.

What was new? The “L” words, a future of liability and litigation over climate change and its attendant instability and risks – and this growing youth movement. The movement is populated by kids who are growing up in a world heavy in human capital but short on natural capital–capital that has never been properly accounted and is fast degrading. (It was a bit unnerving recognizing that I, childless, could be the mother of most of the kids, college students, at this workshop. How did that happen?)

Old fogies (something I hope never to be, please!) and 20th century industrialists best not doubt the power of this brewing youthful BHAG, their Big, Hairy, Audacious Goal to stabilize global warming. Billy Parish (the other BP), who organizes students and forms wide-reaching partnerships, says the clean energy youth movement is not yet national; there’s a long way to go. But it’s getting traction…Rolling Stone, MTV, websites, perhaps a place at a LiveAID event for climate change. Rumors do fly. Energy Action and Black Mesa are perfecting their tools, including a guide on messaging and communications: U.S. in the World. They have successes and demands: “In what would be a first for the state and the nation, [the Hopi and Navajo] are asking the commission to ensure that the utility make up for a history of pollution violations by reinvesting any profits from the sale of pollution credits into clean, renewable energy projects to serve the region's energy needs and create local jobs.”

I figure if a guy can get into Yale (and has the balls to drop out) and a girl can put her very being on the line to challenge status quo on the reservation, they have the chutzpah to lead this Quality of Life Crusade, this Big Hairy Audacious Goal, the legacy we leave to the next generation.

Monday evening several attendees from the workshop showed up at another venue for even more talk on climate change by Tim Flannery, author of “The Weather Makers.” Again, I heard the “L” words…and, not for the first time, the “M” word—moral. We were, after all, in a church…

Other going on this week:
AIG First Major U.S. Insurer With Policy on Climate Change
Market research on nuclear power (public opinion not looking good for nukes)
“Some Like it Hot” in Mother Jones (ExxonMobil’s funding of its echo chambers)

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Monday, June 05, 2006

Energy: "The 21st Century's Greatest Challenge"

This headline is not mine. It's from Deloitte, the white-shoe professional services firm.

Deloitte recently hired Joe Stanislaw, who is a long-time guru in the energy industry, having founded Cambridge Energy Research Associates (CERA). Stanislaw recently authored a compelling report for Deloitte under the title, "Energy in Flux: The 21st Century's Greatest Challenge." It is a sobering picture, from a firm not known for hyperbole.

This is the kind of white paper that is read by senior managers -- strategists and C-level executives -- from the major corporations that need to hear loud and clear what we've been saying here for a while: that we're in deep doo-doo with respect to energy, and that we will need to change how we produce and consume energy in fundamental ways. It's a message that the big-wigs in corporate America need to hear, and they're more likely to listen to respected sources like Deloitte than Greenpeace or Al Gore.

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Sunday, June 04, 2006

Changing the way we think about brown coal

In a post a few months back, i talked about a few clean coal technologies coming out of Australia, and a fairly broad overview of the tech areas. I recently met with Bill Stevens from Latrobe Lignite Developments (LLD) who gave me some more detailed insight into the potential of brown coal as an energy and carbon product resource.

Brown coal (Lignite) is essentially made up of around 60% water, 20% petrochemical volatiles and 20% carbon base. The high water content and low carbon content traditionally has meant that this form of coal is primarily used for steam-electricity energy production. The large amounts of water in the fuel mean that a large amount of heat is wasted in heating this water up, and loosing it into the atmosphere as water vapour.

Prior to my discussion my understanding was that the brown coal discussion essentially was that you can improve the efficiencies of burning coal to reduce CO2 emissions through removing water content, and improve the efficiency of energy generation. However this has its econimic and emission reduction problems.

Efforts to reduce the water content of lignite have been either to chemically separate it, mechanically squeeze it, or dry it through using byproduct heat or spread the material out in the sun. The challenge is all these approaches required energy, as a result any real greenhouse benefit is reduced through all the toil involved.

Also the power stations in the Latrobe Valley in Victoria, Australia are designed to be as efficient as possible to burn brown coal, not dry brown coal. Hence in reality you could partially mix some dry coal into the feedstock for the generators, but probably only about 5%. Thus you need a new power station if you want to burn the new dry brown coal.

LLD has produced a technology which takes advantages of a few other factors in the economic equation around brown coal, namely carbon products and water. First the stats:
  • The prices a, la trobe valley brown coal costs about A$5 and Antracite and coking coal costs about A$50
  • New energy generation emissions limits: Brown coal must generate at most 1.2T C02 per MW, black coal power plant must generate at most 0.9T C02 per MW. In comparison a gas plant must generate at most 0.5T C02 per MW.
  • Water: for every 2000T per hour of brown coal at Loyang (Latrobe valley) power station, over 12million T of water is removed annually from the local river.
LLDs tech uses the above economic and emission factors to turn the traditional generation mechanism around. The tech drys the brown coal recovering the water, removes the volatile component for energy generation, and produces high quality carbon for steel production or other carbon products.

Thus a A$5 feedstock produces a A$50 value product at around $15 cost, Produces volatiles that can produce energy at 0.5T Co2 per megaw