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Top 10 Cleantech Subsidies and Policies (and the Biggest Losers) – Ranked By Impact

We all know energy is global, and as much policy driven as technology driven.

We have a quote, in energy, there are no disruptive technologies, just disruptive policies and economic shocks that make some technologies look disruptive after the fact.  In reality, there is disruptive technology in energy, it just takes a long long time.  And a lot of policy help.

We’ve ranked what we consider the seminal programs, policies and subsidies globally in cleantech that did the helping.  The industry makers.  We gave points for anchoring industries and market leading companies, points for catalyzing impact, points for “return on investment”, points for current market share, and causing fundamental shifts in scale, points for anchoring key technology development, points for industries that succeeded, points for industries with the brightest futures.  It ends heavy on solar, heavy on wind, heavy on ethanol.  No surprise, as that’s where the money’s come in.

1.  German PV Feed-in Tariff – More than anything else, allowed the scaling of the solar industry, built a home market and a home manufacturing base, and basically created the technology leader, First Solar.

2. Japanese Solar Rebate Program – The first big thing in solar, created the solar industry in the mid 90s, and anchored both the Japanese market, as well as the first generation of solar manufacturers.

3. California RPS – The anchor and pioneer renewable portfolio standard in the US, major driver of the first large scale, utility grade  wind and solar markets.

4. US Investment Tax Credit for Solar – Combined with the state renewable portfolio standards, created true grid scale solar.

5. Brazilian ethanol program – Do we really need to say why? Decades of concerted long term support created an industry, kept tens of billions in dollars domestic.  One half of the global biofuels industry.  And the cost leader.

6. US Corn ethanol combination of MTBE shift, blender’s, and import tariffs – Anchored the second largest global biofuels market, catalyzed the multi-billion explosion in venture capital into biofuels, and tens of billions into ethanol plants.  Obliterated the need for farm subsidies.  A cheap subsidy on a per unit basis compared to its impact holding down retail prices at the pump, and diverted billions of dollars from OPEC into the American heartland.

7. 11th 5 Year Plan  – Leads to Chinese leadership in global wind power production and solar manufacturing.  All we can say is, wow!  If we viewed these policies as having created more global technology leaders, or if success in solar was not so dominated by exports to markets created by other policies, and if wind was more pioneering and less fast follower, this rank could be an easy #1, so watch this space.

8. US Production Tax Credit – Anchored the US wind sector, the first major wind power market, and still #2.

9. California Solar Rebate Program & New Jersey SREC program – Taken together with the RPS’, two bulwarks of the only real solar markets created in the US yet.

10. EU Emission Trading Scheme and Kyoto Protocol Clean Development Mechanisms – Anchored finance for the Chinese wind sector, and $10s of Billions in investment in clean energy.  If the succeeding COPs had extended it, this would be an easy #1 or 2, as it is, barely makes the cut.

 

Honorable mention

Combination of US gas deregulations 20 years ago and US mineral rights ownership policy – as the only country where the citizens own the mineral rights under their land, there’s a reason fracking/directional drilling technology driving shale gas started here.  And a reason after 100 years the oil & gas industry still comes to the US for technology.  Shale gas in the US pays more in taxes than the US solar industry has in revenues.  But as old policies and with more indirect than direct causal effects, these fall to honorable mention.

Texas Power Deregulation – A huge anchor to wind power growth in the US.  There’s a reason Texas has so much wind power.  But without having catalyzed change in power across the nation, only makes honorable mention.

US DOE Solar Programs – A myriad of programs over decades, some that worked, some that didn’t.  Taken in aggregate, solar PV exists because of US government R&D support.

US CAFE standards – Still the major driver of automotive energy use globally, but most the shifts occurred before the “clean tech area”.

US Clean Air Act – Still the major driver of the environmental sector in industry, but most the shifts occurred before the “clean tech area”.

California product energy efficiency standards – Catalyzed massive shifts in product globally, but most the shifts occurred before the “clean tech area”.

Global lighting standards /regulations – Hard for us to highlight one, but as a group, just barely missed the cut, in part because lighting is a smaller portion of the energy bill than transport fuel or generation.

 

Biggest Flops

US Hydrogen Highway and myriad associated fuel cell R&D programs.  c. $1 Bil/year  in government R&D subsidies for lots of years,  and 10 years later maybe $500 mm / year worth of global product sales, and no profitable companies.

Italian, Greek, and Spanish Feed in Tariffs – Expensive me too copycats, made a lot of German, US, Japanese and Chinese and bankers rich, did not make a lasting impact on anything.

California AB-32 Cap and Trade – Late, slow, small underwhelming, instead of a lighthouse, an outlier.

REGGI – See AB 32

US DOE Loan Guarantee Program – Billion dollar boondoggle.  If it was about focusing investment to creating market leading companies, it didn’t.  If it was about creating jobs, the price per job is, well, it’s horrendous.

US Nuclear Energy Policy/Program – Decades, massive chunks of the DOE budget and no real technology advances so far in my lifetime?  Come on people.  Underperforming since the Berlin Wall fell at the least!

 

$100,000 Cleantech Shipping Grant Competition

WWL is one of the cleanest shipping companies and each year, offers a grant to the best new clean-tech innovation.

We are hoping to raise as much awareness of this scheme as possible to attract some really high quality entries – the grant has been upped this year to $100,000 and last year’s winner has seen his idea (a concept to rival SkySails) being trialled on ships at the moment.

With just over a month to go until its 2011 Orcelle Grants application period closes, global shipping and logistics provider Wallenius Wilhelmsen Logistics asked naval architects Per Brinchman and Per Tunell to share their insights into what makes a winning clean-tech idea.

This year, WWL has expanded the eligibility criteria for the Orcelle Grants to include alternative energy sources and energy-efficient technologies with applications for 1) commercial shipping and 2) terminal operations, reflecting WWL’s research and development into the E/SOrcelle, a zero emissions concept vessel, and the Castor Green Terminal, a zero-emissions terminal and cargo processing centre.

Applications are being welcomed from across the world from individual inventors, entrepreneurs and technology developers and are available at www.2wglobal.com/www/environment/OrcelleGrants. All applications must be submitted by Monday March 21, 2011. Winners will be announced in April 2011.

WWL head of environment, Melanie Moore, speaks to Per Brinchman and Per Tunell:

More about Wallenius Wilhelmsen Logistics

Wallenius Wilhelmsen Logistics (www.2wglobal.com) delivers innovative and sustainable global shipping and logistics solutions for manufacturers of cars, trucks, heavy equipment and specialized cargo. WWL has approximately 3,300 employees worldwide, and deploys around 60 modern eco-adapted vessels. The company has a strong environmental focus and is an industry leader in developing innovative solutions to reduce its operational impacts on the environment.

The Seminal List of Authoritative Cleantech Definitions

It dawned on me after I MC’ed the Cleantech Open Gala Awards Ceremony two weeks ago (congrats again the to winners!), that there were now some 5.6 mm listings on google for the term cleantech, and while virtually every data provider or leading market analysis firm in the sector had tried to define cleantech, no one had ever tried to reconcile the different definitions.  And since after Cleantech.com and Wikipedia, the next two websites are mine, I ought to be the one to kick it off.  Especially since I wrote the first mini-history essay on cleantech in 2007.

So in conjunction with our new Cleantechblog.com facebook fan page, here is the first seminal list of definitions of cleantech.  Send us new ones in the comments.

Here’s our official Cleantech.org definition of cleantech, slightly revised from 2007:  Cleantech (noun) KLEEN TEK  is the generally accepted umbrella term referring to a variety of products and services, investment asset classes, technologies, government policies, and business sectors which encompass some combination of clean energy, environmentally friendly, and sustainable or green attributes; Synonyms/AKAs: clean tech, clean technology, greentech, green tech, energy & environmental technology


“What is Cleantech?” the first mini history of cleantech I wrote in 2007, published on Google’s Knol and Cleantech Blog and CNET, at the time tried to lay out in brief of how the term cleantech or clean tech came to be defined, and why some firms still used greentech to refer to their investing strategy.

“Cleantech, also referred to as clean technology, and often used interchangeably with the term greentech, has emerged as an umbrella term encompassing the investment asset class, technology, and business sectors which include clean energy, environmental, and sustainable or green, products and services. . . .

The term has historically been differentiated from various definitions of green business, sustainability, or triple bottom line industries by its origins in the venture capital investment community, and has grown to define a business sector that includes significant and high growth industries such as solar, wind, water purification, and biofuels.”

No definition of cleantech should start without first reading the Cleantech.com current definition, as they really get credit for popularizing the term, or more accurately, the Cleantech Group cofounders, Keith Raab and Nick Parker do.

“Clean technology, or “cleantech,” should not be confused with the terms environmental technology or “green tech” popularized in the 1970s and 80s. Cleantech is new technology and related business models that offer competitive returns for investors and customers while providing solutions to global challenges.

While greentech, or envirotech, has represented “end-of-pipe” technology of the past (for instance, smokestack scrubbers) with limited opportunity for attractive returns, cleantech addresses the roots of ecological problems with new science, emphasizing natural approaches such as biomimicry and biology. Greentech has traditionally only represented small, regulatory-driven markets. Cleantech is driven by productivity-based purchasing, and therefore enjoys broader market economics, with greater financial upside and sustainability.

Cleantech represents a diverse range of products, services, and processes, all intended to:

  • Provide superior performance at lower costs, while
  • Greatly reducing or eliminating negative ecological impact, at the same time as
  • Improving the productive and responsible use of natural resources”

They’ve also long maintained a taxonomy of cleantech, currently with 11 categories:

“Energy Generation
* Wind
* Solar
* Hydro/Marine
* Biofuels
* Geothermal
* Other

Energy Storage
* Fuel Cells
* Advanced Batteries
* Hybrid Systems

Energy Infrastructure
* Management
* Transmission

Energy Efficiency
* Lighting
* Buildings
* Glass
* Other

Transportation
* Vehicles
* Logistics
* Structures
* Fuels

Water & Wastewater
* Water Treatment
* Water Conservation
* Wastewater Treatment

Air & Environment
* Cleanup/Safety
* Emissions Control
* Monitoring/Compliance
* Trading & Offsets

Materials
* Nano
* Bio
* Chemical
* Other

Manufacturing/Industrial
* Advanced Packaging
* Monitoring & Control
* Smart Production

Agriculture
* Natural Pesticides
* Land Management
* Aquaculture

Recycling & Waste
* Recycling
* Waste Treatment”

CleanEdge Original 2001 Definition of Clean Tech

However, while the Cleantech Group does not lay credit to coining the term (nobody really does), the first original report on Clean Tech was by CleanEdge in 2001.

With Ron Pernick, Clint Wilder, and Joel Makower behind it, Clean Tech: Profits and Potential laid out a four leaf clover of clean technology was around Clean Transportation, Clean Energy, Clean Materials, and Clean Water.  And the reports original forecasts, while a bit understated looking back, were quite prescient.  Except perhaps for the bits about fuel cells and microturbines, but we won’t hold that against them!

But then no definition list would be complete without Wikipedia’s cleantech article (not the we trust it!)

Cleantech is a term used to describe products or services that improve operational performance, productivity, or efficiency while reducing costs, inputs, energy consumption, waste, or pollution. Its origin is the increased consumer, regulatory and industry interest in clean forms of energy generation—specifically, perhaps, the rise in awareness of global warming, climate change and the impact on the natural environment from the burning of fossil fuels. The term cleantech is often associated with venture capital funds.”


And more recently, Dallas Kachan, cleantech analyst and former editor of Cleantech.com, and before that Inside Greentech, published a new cleantech taxonomy on our Cleantech Blog. Arguing that the old taxonomy’s had gotten long in the tooth, Kachan & Co highlight a 3 level taxonomy with 8 top level categories:

  • Renewable Energy Generation
  • Energy Storage
  • Energy Efficiency
  • Green Building
  • Transportation
  • Air & Environment
  • Clean Industry
  • Water
  • Agriculture

A few other definitions are worth noting:

Matt Marshall in Venture Beat commented a couple of years back on Dow Jones Venture One’s definition of cleantech, which defined as:

“Because of the significant level of attention being focused on cleantech, VentureOne’s research department adopted a strict methodology for categorizing potential companies in this new industry. They were defined as companies that directly enable the efficient use of natural resources and reduce the ecological impact of production. Areas of focus include energy, water, agriculture, transportation, and manufacturing where the technology creates less waste or toxicity. The impact of cleantech can be either to provide superior performance at lower costs or to limit the amount of resources needed while maintaining comparable productivity levels.”

And of course that means that Thompson Reuters and the National Venture Capital Association jumped into the game in 2008:

“To enable more precise reporting on clean technology companies, Thomson Reuters has newly implemented a specific “clean technology” flag for the portfolio company database. Using the definition that clean technology investment focuses on innovations which conserve energy and resources, protect the environment, or eliminate harmful waste, transactions are coded by the data team and reviewed by the QA team for whether they meet the clean tech criteria. VentureXpert is the official database of the NVCA.”

And NRDC with E2 published their version in 2004 when arguing for a California Cleantech Cluster

“Cleantech as a distinct industry is still in its formative years. The industry encompasses a broad range of products and services, from alternative energy generation to wastewater treatment to environmentally friendly consumer products. Although some of these industries are very different, all share a common thread: They use new, innovative technology to create products and services that compete favorably on price and performance, while reducing mankind’s impact on the environment.”

In conclusion, aka, Let me explain. No, there is too much. Let me sum up

  • Damn, there are a lot of lists.  Why doesn’t someone do an analysis on them?
  • We are still waiting for Greentech Media and Michael Kanellos, and the Gartner Group to weigh in, not to mention Rob Day, the original Cleantech Investing blogger.
  • We have green washing in the green sector, but cleantech is a very inclusive sector, which means so far there’s still no sign of cleantech washing hawks, or even a first definition of cleantech washing (maybe I’ll write that next).
  • It is worth noting with some humor how many of these definitions try to shoe-horn in the notion of “and it’s cheaper, too!”.  I figure that  falls into the category of if you have to say it is, then it probably isn’t, but since half of these definitions include input from venture capitalists trying to justify why they’re investing in policy driven investments, a historic no-no in VC-land.
  • Note how the last three definitions build on concepts from the earlier ones.

But the real question is, just because you think you’re cleantech, are you actually cleantech – across EVERY definition?

Clean Technology Venture Investment Increases 65 Percent in First Half of 2010

Matches 2008 Investment Record

The Cleantech Group and Deloitte released preliminary 2Q 2010 results for clean technology venture investments in North America, Europe, China and India, totaling $2.02 billion across 140 companies.

Cleantech venture investment was up 43 percent from the same period a year ago. The number of deals recorded in 2Q10 was down from a record high of 192 in 1Q10, but still represents a strong quarter by historic standards. This completes 1H10, up 65 percent on 1H09.

Corporate activity around cleantech innovation has continued to play an important role in maintaining the levels of investment activity. Corporations are becoming key participants in many of the largest venture and growth capital investment rounds. Strong corporate involvement was evident again in the quarter’s top ten deals: Intel Capital, GE Capital, Shell, Votorantim, Alstom, and Cargill Ventures all contributed, the latter two making their first publicly disclosed venture-stage investments in cleantech.

Corporations have multi-faceted roles in cleantech. Any single utility or multi-national could play any or all of the following roles – investor, partner, customer, acquirer, or competitor. As such, their activity levels are a key indicator of the health and growth of the broader market for clean technology products. The strengthening of corporate commitment to renewable energy and broader cleantech are evident in the strong growth of multi-national corporate and U.S. utility investment for the first half of 2010 :

1H10, total announced capacity additions by U.S. utilities increased 197 percent compared to 2H09, from 1,393MW to 4,134MW, primarily driven by wind and solar. Power purchase agreements (PPAs) rose 148 percent in 1H10, compared to 2H09, from 621MW to 1,539MW, likely due to the pressure of meeting Renewable Portfolio Standards in many U.S. states. Corporate investment announcements from the global corporates tracked reached a new high of $5.1 billion in 1H10, a 325 percent increase from the same period last year.

“The significant strengthening of corporate and utility investment into the cleantech sector, relative to 2009, is very encouraging, given the key role they will play in enabling broader adoption of clean technologies at scale,” said Scott Smith, partner, Deloitte & Touche LLP and Deloitte’s clean tech leader in the United States. “Major U.S. utilities are increasing direct investments in wind and solar due to improving cost scenarios, favorable tax credits and incentives, and evolving pressure to meet Renewable Portfolio Standards. Meanwhile, the largest global companies are seeing the business case for operational cleantech integration, leading to record corporate investment. This uptick was driven by companies looking to improve energy efficiency and reduce carbon emissions in order to reduce operational costs, mitigate energy price volatility risk, drive sustainable growth, and comply with existing and pending regulations around carbon and climate change risk disclosure.”

VENTURE INVESTMENT BY TECHNOLOGY SECTOR

The leading sector in the quarter by amount invested was solar ($811 million), followed by biofuels ($302 million) and smart grid ($256 million). Energy efficiency was the most popular sector measured by number of deals, with 31 funding rounds, ahead of solar (26 deals) and biofuels (13 deals). The largest transactions in these sectors were:

SOLAR – $811 million in 26 deals

Solyndra, a California-based thin film company raised $175 million from existing investors instead of following through with its planned IPO. BrightSource Energy, a California-based developer of utility-scale solar thermal power plants, raised $150 million in Series D funding from new investors Alstom and the California State Teachers Retirement System (CalSTRS) as well as existing investors; the deal followed a conditional commitment from the U.S. Department of Energy for $1.37 billion in loan guarantees that was made in February and Amonix, a California-based developer of concentrated photovoltaic (CPV) solar power systems, raised $129.4 million in a Series B round led by Kleiner, Perkins, Caufield & Byers.

BIOFUELS – $302 million in 13 deals

Amyris Biotechnologies, a California-based developer of technology for the production of renewable fuels and chemicals, closed the final tranche of a $61 million Series C round and also raised a further $47.8 million from Temasek Holdings; Virent Energy Systems, a Wisconsin-based developer of a catalytic bio-refinery platform, raised $46 million from Shell and Cargill Ventures; and Kior, a Texas-based developer of a catalytic cracking technology for turning biomass into bio-crude, raised $40 million.

SMART GRID – $256 million in 11 deals

Landis+Gyr, a Switzerland-based smart metering company, raised an additional $165 million from Credit Suisse to add to the $100 million it raised in mid-2009, while OpenPeak, a Florida-based developer of home energy management products, raised $52 million from Intel Capital and existing investors, and GreenWave Reality a Denmark-based developer of home energy management products, raised $11 million from Craton Equity Partners and other undisclosed investors.

ENERGY EFFICIENCY – $147 million in 31 deals

Nualight, an Ireland-based developer of LED illumination products for refrigerated displays in food retail, raised $11.4 million from Climate Change Capital Private Equity, 4th Level Ventures and ESB Novus Modus. This was the largest deal in the energy efficiency category after OpenPeak ($52million, as above).

VENTURE INVESTMENT BY WORLD REGION

North America accounted for 72 percent of the total, while Europe and Israel accounted for 24 percent, India 3 percent, and China for 2 percent.

NORTH AMERICA: North American companies raised USD $1.46 billion, down 11 percent from 1Q10 but up 47 percent from 2Q09. The total of 76 disclosed rounds was high by historic standards, but down by 41 percent from the record 128 in 1Q10. As the most significant region for VC investment, the sector trends broadly match those described globally. The largest deals were for Solyndra ($175 million), a California-based thin film solar company, BrightSource Energy ($150 million), a California-based developer of utility-scale solar thermal power plants, and Amonix ($129.4 million), a California-based developer of concentrated photovoltaic (CPV) solar power systems. California led the way, with $980 million (67 percent total share) in investment, followed by Massachusetts ($124 million, 8 percent).

EUROPE/ISRAEL: European and Israeli companies raised USD $476 million in 54 disclosed rounds, up 48 percent (by amount) from 1Q10 and up 100 percent from 2Q09. The largest deals were for Swiss smart grid company Landis+Gyr ($165 million) and French solar plant developer Fonroche ($66.1 million). The large growth capital deal for Landis+Gyr places Switzerland ($165 million, 1 deal) at the top of the country league table, followed by France ($82 million, 11 deals), and Norway ($59 million, 4 deals). The UK had the most deals (17) with investment totaling $59 million.

CHINA: Chinese companies raised USD $30 million in 5 disclosed rounds. The largest deal was for Prudent Energy, a developer of flow batteries, which raised $10 million from JAFCO Investment Asia, Mitsui Ventures and CEL Partners.
INDIA: Indian companies raised USD $59 million in 4 disclosed rounds. The largest deal was for Krishidhan Seeds, a producer and distributor of hybrid seeds for the farming industry, which raised $30 million from Summit Partners.

GLOBAL M&As AND IPOs

There were 19 clean technology IPOs during the quarter, totaling $2.31 billion, up slightly from 18 IPOs in 4Q09, also totaling $2.31 billion. China accounted for the majority of transactions, with 12 offerings, which raised a combined $1.73 billion (75 percent of the overall total). There were three North American cleantech IPOs in 1Q 2010, which raised a total of $304 million, the lion share netted by the high-profile $226m IPO of Tesla Motors on June 29, 2010.
However, the largest global cleantech IPO recorded during the quarter was Origin Water, a China-based developer of membrane filtration systems for municipal and industrial sewage treatment and recycling, which raised $370 million from an offering on the Shenzhen Stock Exchange. The company’s share price more than doubled during the first day of trading, valuing the company at about $3.3 billion.

Clean technology M&A totaled an estimated 160 transactions in 2Q10, of which totals were disclosed for 45 transactions totaling $6 billion. Two of the most significant deals were in smart grid: Swiss engineering company ABB acquired U.S.-based software maker Ventyx for more than $1 billion to provide it with broader access to the utility enterprise management market; and Maxim Integrated Products acquired U.S.-based smart meter semiconductor company Teridian Semiconductor for about $315 million in cash.

TOP GLOBAL VC INVESTORS

2Q10 Most Active Cleantech Venture Investors (# investments)
Carbon Trust Investment Partners 6 = Helveta, Green Biologics, Intamac Systems, ACAL Energy, Arieso, Concurrent Thinking,
Kleiner Perkins Caufield & Byers 4 = Amonix, Amyris Biotechnologies, Fisker Automotive, EdeniQ
Angeleno Group 3 = Amonix, Coda Automotive, EdeniQ
Draper Fisher Jurvetson 3 = BrightSource Energy, EdeniQ, Scientific Conservation
Khosla Ventures 3 = Coskata, Amyris Biotechnologies, Sakti3

The Cleantech GroupT, providers of leading global market research, events and advisory services for the cleantech industry, along with Deloitte, which provides audit, tax, consulting and financial advisory services to cleantech companies, released these preliminary 2Q 2010 results for clean technology venture investments in North America, Europe, China and India, totaling $2.02 billion across 140 companies.

Tesla’s Strategic Relationships with Toyota and Daimler

By John Addison (5/27/10)

Toyota agreed to purchase $50 million of Tesla’s common stock subsequent to the closing of Tesla’s currently planned initial public offering, giving Toyota over 2 percent of Tesla. The investment was negotiated with Tesla’s purchase of the former NUMMI factory in Fremont, California, that once employed over 4,000 workers in a Toyota-General Motors JV plant. Tesla and Toyota intend to cooperate on the development of electric vehicles, parts, and production system and engineering support. Neal Dikeman reported on Friday the significance of this for Tesla, Toyota, and California jobs.

In 2012, new Tesla S sedan will roll-out of the plant with electric range that remarkably matches the range of many gasoline cars. Tesla is developing a roomy Model S hatchback that starts at $57,400, about half the price of the Roadster. Tesla will start delivering the Model S in 2012 from its new factory in California. The Model S will have up to a 300 mile range, far beyond the Nissan Leaf 100 mile range the Chevy Volt 40-mile electric range, and current ambitions of other electric car makers. Top 10 Electric Car Makers

Tesla will compete with other sedan makers by also offering more passenger space, more cargo space, and a premium cache. With seating for five adults and two children, plus an additional trunk under the hood, Model S has passenger carrying capacity and versatility rivaling SUVs and minivans. Rear seats fold flat, and the hatch gives way to a roomy opening.

With a range up to 300 miles and 45-minute QuickCharge, the Model S can carry five adults and two children in quiet comfort. The roomy electric car starts at a base price of $57,400, before the $7,500 federal EV tax credit and additional tax credits in many states. Yes, it will be more expensive than sedans from Nissan, Ford, and GM but with more battery storage for more range with 3 battery pack options offer a range of 160, 230 or 300 miles per charge.
Don’t pull-up to the Model S in your sedan and try to race. The Model S goes from 0-60 mph in 5.6 seconds with 120 mph top speed, and the promise of sporty handling in the chassis and suspension.

Panasonic Lithium Batteries and Tesla Packs

Tesla touts its expertise and intellectual property in a proprietary electric powertrain that incorporates four key components—an advanced battery pack, power electronics module, high-efficiency motor and extensive control software.

Tesla delivers more range per charge than other electric vehicles by including more lithium batteries. Tesla’s relationship with battery supplier Panasonic is critical. The Roadster uses 6,800 Panasonic lithium-nickel consumer-sized batteries integrated into a Tesla designed battery-pack with unique energy management and thermal management. The new Tesla Model S will use up to 5,500 Panasonic batteries.

Tesla has been skillful in developing strategic partnerships. Tesla also has a relationship with Daimler to supply technology, battery packs and chargers for Daimler’s Smart fortwo electric drive. Daimler holds more than 5% of Tesla’s capital stock. Daimler has orders for Tesla to supply it with up to 1,500 battery packs and chargers to support a trial of the Smart fortwo electric drive in at least five European cities. Tesla delivered the first of these battery packs and chargers in November 2009. Daimler also engaged Tesla to assist with the development and production of a battery pack and charger for a pilot fleet of its A-Class electric vehicles to be introduced in Europe during 2011. Tesla has ambitions to supply other vehicle makers.

By John Addison, Publisher of the Clean Fleet Report and conference speaker.

36 States now have Utility-Scale Wind Power

(4/12/10)

The U.S. wind energy grew in 2009, despite a severe recession. There are 36 states that have utility-scale wind projects and 14 states are in the “Gigawatt Club” with more than 1,000 MW of installed wind capacity per state. In state rankings, Iowa leads in terms of percentage of electricity from wind power, getting 14% of its power from the wind, and also leads in highest number of jobs in the manufacturing sector. Texas consolidated its lead in wind capacity and in largest wind farms installed, according to the annual wind industry market report by the American Wind Energy Association (AWEA).

“Jobs, business opportunities, clean air, energy security—wind power is delivering today on all those fronts for Americans,” said AWEA CEO Denise Bode. “Our annual report documents an industry hard at work and on the verge of explosive growth if the right policies—including a national Renewable Electricity Standard (RES) — are put in place. A national RES will provide the long-term certainty that businesses need to invest tens of billions of dollars in new installations and manufacturing facilities which would create hundreds of thousands of American jobs.”

Highlights from AWEA’s new report include:

•The U.S. wind energy industry installed over 10,000 MW of new wind power generating capacity in 2009, the largest year in U.S. history, and enough to power the equivalent of 2.4 million homes or generate as much electricity as three large nuclear power plants.

•In industry rankings, GE Energy remained #1 in U.S. wind turbine sales; NextEra Energy Resources continued to lead in wind farm ownership; and Xcel Energy continued to lead utilities in wind power usage. At the same time, however, more companies are now active in each of these areas, showing that the wind energy market is diversifying as it expands.

•The report’s section on manufacturing shows that in spite of a slowdown in wind turbine manufacturing in 2009 compared to 2008, 10 new manufacturing facilities came online in the U.S. last year, 20 were announced, and nine facilities were expanded. The largest category was wind turbine sub-components, such as bearings, electrical components and hydraulic systems. In all, the U.S. wind energy industry opened, announced or expanded over 100 facilities in the past three years (2007- 2009), bringing the total of wind turbine component manufacturing facilities now operating in the U.S. to over 200.

•All 50 states have jobs in the wind industry.

•Approximately 85,000 people are employed in the wind industry today and hold jobs in areas as varied as turbine component manufacturing, construction and installation of wind turbines, wind turbine operations and maintenance, legal and marketing services, transportation and logistical services, and more.

•To ensure a skilled workforce across the wind energy industry, 205 educational programs now offer a certificate, degree, or coursework related to wind energy. Of these 205 programs, the largest segments are university and college programs (45%) and community colleges or technical school programs (43%).

•Despite the economic downturn, the demand for small wind systems for residential and small business use (rated capacity of 100 kW or less) grew 15% in 2009, adding 20 MW of generating capacity to the nation. Seven small wind turbine manufacturing facilities were opened, announced or expanded in 2009.

•Offshore wind power is gaining momentum in the U.S. The report lists seven projects with significant progress in the planning, permitting, and testing process. Both the federal government and several states established significant milestones in 2009 to encourage offshore wind power development.

•America’s wind power fleet of 35,000 MW will avoid an estimated 62 million tons of carbon dioxide annually, equivalent to taking 10.5 million cars off the road.

•America’s wind power fleet will conserve approximately 20 billion gallons of water annually that would otherwise be lost to evaporation from steam of cooling in conventional power plants.

Renewable Energy and Clean Transportation Reports

By John Addison. Publisher of the Clean Fleet Report and conference speaker.

Fuel from Algae – Challenges do not Stop Big Bucks

By John Addison (3/3/10 – original post at Clean Fleet Report)

Energy, Water, and Fuel are three of the world’s most pressing needs. Algal biofuel can have a major impact on all three observed Dr. Michael Webber in opening the recent American Association for Advancing Science (AAAS) workshop about the future of fuel from algae.

Algae seems to grow everywhere except in commercial fuel processing plants. Algae grow unwanted in our showers and swimming pools. There are over 30,000 species living on land and in water. Algae include seaweed and pond scum. Scientists are actively searching for the ideal forms of algae to convert our waste and CO2 into fuel. The idea is simple: grow algae, separate the fatty lipids from water, then refine the lipids into biofuel. Producing high volumes of algae biofuel at low cost, however, is anything but simple.

Algae multiply rapidly with up to 50 percent of their weight being lipids, or triacylglycerols, which can be extracted and converted into fuel. Yes, biodiesel and other transportation fuels can be made from algae, but after decades of effort the fuel is still expensive and only made in lab-scale quantities. There are many obstacles to replacing petroleum with algal fuel in this decade. As I took notes at this three hour workshop that includes top experts in algal fuel, I had hoped to deliver a more optimistic report, but no optimism was gushing in the room.

Even if 10 million of the 240 million vehicles in the U.S. are replaced with plug-ins in this decade, that leaves 230 million vehicles needing petroleum fuel, often sourced from countries that don’t like us, or from sources such as tar sands with massive carbon emissions. Biofuel could reduce our dependency on oil. Fuel from algae can include ethanol, biodiesel, bio-jet fuel, and even bio-crude which could be refined and blended at existing oil refineries.

Currently, biofuel from corn, soy, and palm competes with food, uses large inputs of water, ammonia, petroleum, and land. Demand for food goes up; rainforests that supply our oxygen get destroyed.

“If we were to replace all of the diesel that we use in the United States” with an algae derivative, says Solix CEO Douglas Henston, “we could do it on an area of land that’s about one-half of one percent of the current farm land that we use now.”

Scientists at the AAAS conference seem to agree that 4,350 to 5,700 gallons of fuel per acre of algae per year is realistic. This is 10 to 100 times the potential of other fuel sources ranging from soy to jatropha. Land use is not an issue. Algae thrives on CO2, creating the dream of co-locating algal production at power plants and cement plants.

The DOE states, “Despite their huge potential, the state of technology for producing algal biofuels is regarded by many in the field to be in its infancy. There is a general consensus that a considerable amount of research, development, and demonstration (RD&D) needs to be carried out to provide the fundamental understanding and scale-up technologies required before algal-based fuels can be produced sustainably and economically enough to be cost-competitive with petroleum-based fuels.” Now available is a 214-page draft PDF of the National Algal Biofuels Technology Roadmap.

Thousands of strains of algae are being tested by private companies, universities, and research institutions. To achieve higher sustained production of triglycerides, hundreds of variables are being tested including natural strains, GMO strains (many patented), water, light intensity, nutrients, and nitrogen starvation.

Oil must be “brewed” with the right solution, light, mixing, and stirring. Cost-effective photobioreactors must be developed. Dr. Bob Hebner, University of Texas at Austin, has produced 6,000 gallons of algae in one day. Low cost targets appear achievable – $2 per gallon to produce algal oil and another $2 per gallon to process. Yet these are only achievable if the right organisms can be kept alive, water input reduced, energy costs reduced, and lipids can be separated at much lower cost. Costs must be removed at each of these steps:

1. Growing the desired strain. Major problems include predators, competing strains, and death of the needed strain.
2. Harvesting – removing water at low cost
3. Lysing to produce a lipid concentrate
4. Separations – oil from water from biomass

To achieve low cost and volume production, different pathways are being explored including anaerobic digestion, supercritical fluids, pyrolysis, and gasification.

Although algal fuel does not compete with food, it currently does compete with water. For large scale processing use of water will need to be drastically reduced to be economical with the energy cost of pumping water. Waste water or salt water will be needed, not water needed for agriculture. Optimization can likely drastically reduce needed water which can then be recycled.

Genetically modified organisms are controversial. To date, no consistent output from natural algal systems has been achieved. At the AAAS conference, Dr. Dan Kammen, U.C. Berkeley and IPCC lead author, discussed how natural strains of algae could be possible in global small scale production. He expressed concern that although GMO can cause highly productive algae, their inevitable release into other biosystems could be highly destructive.

With its ability to sequester CO2, algal fuel production will benefit from cap-and-trade legislation that exists in many states. Algal fuel can be produced in all 50 U.S. states.

Although the challenges are many, the potential of algal fuel is enormous. Exxon is investing $300 million in Craig Ventor’s Synthetic Genomics with plans to produce fuel from algae. Mexico’s BioFields is investing $850 million in an Algenol Biofuels plant for ethanol from microalgae; Dow is adding $50 million to the venture.

Greg Horowitt, T2 Venture Capital, reports that hundreds of millions are being invested in algal fuel companies such as Sapphire Energy, Aurora BioFuels, BARD, Solix, GreenFuel, and Solazyme. From Boeing to BP, from DARPA to DOE, and from Arch Venture Partners to Bill Gates, serious money is betting that algae will someday be a major biofuel source for our trucks, ships, and planes.

John Addison publishes the Clean Fleet Report and speaks at conferences.

Will Google Charge your Electric Cars?

By John Addison – original article at Clean Fleet Report

Google Energy could be a Smart Charging and V2G Provider

Google finally won approval from Federal Energy Regulatory Commission (FERC) to be an electric utility. Now that they are making billions delivering web ads, do they want to make added billions selling electricity? Quite possibly. Google already offers a smart meter app that allows smart grid customers to manage their home electricity use. With their new approval to be a utility, Google could be a smart grid / smart charge service provider.

Auto makers and utilities have already agreed on smart charging standards that allow you to plug-in using a J1772 connection, but not have charging start immediately. A service provider is needed to look at your preferences, take action, and provide information. Your preference might be to not charge until 9 p.m. when rates fall to a fraction of peak electricity demand hours. You might want to receive a text message when your charging is complete. You might want Google Maps to show you the nearest public charging stations that are available and display their cost per kilowatt hour. It looks like a natural for companies like Google. They story gets better in the year’s ahead when cars are V2G enabled.

Electric car sales will get a boost when the utility meter spins backward and customers make money by plugging-in. University of Delaware, AutoPort, and partners are planning to put 100 electric cars on the road in the next 18 months that will plug-in and sell power back to the utility using vehicle-to-grid (v2G) technology. AutoPort plans to secure local fleets that fund conversion of their vehicles. The University of Delaware currently has six Scion eBoxs, converted by AC Propulsion, to be electric cars with V2G.

I just got to hear from the V2G experts while I attend the American Association for Advancing Science (AAAS) Conference. I am posting this report from the conference.

A solar home might have 3 to 5 kW of solar PV. An electric car might have 24 kWh stored in its lithium batteries. Vehicles can be charged at night when excess wind and other forms of electricity are generated. The electricity can be sold back at premium rates during peak hours.
By the end of the decade, some electric cars will be less expensive to purchase than gasoline powered cars; most will be much cheaper to fuel. Monthly electric utility bills will be small for some; others will get paid to plug-in. The concept is not new. Solar power grew rapidly whenever feed-in tariffs created an incentive by having utilities purchase power from homes and businesses.

V2G will initially be promoted by agile businesses that can make things happen much faster than cautious utilities or automakers. When V2G becomes a billion dollar business, look for hundreds of players including auto makers and utilities.

The V2G cars in Delaware will get Big Bucks to sell electricity back to the grid. Electric utilities are becoming desperate for stored energy. Utilities are willing to pay serious money for some contracted delivery of electricity. Dr. Jasna Tomic of CALSTART reports that utilities will pay $15 to 55 MWh for electricity supplied for frequency regulation, but the utility does not want to deal with 100,000 car drivers. The utility wants one aggregator in the middle to provide the power. This could eventually be a billion dollar opportuntity for a Google, GE, IBM, EnerNOC, Better Place, or a new start-up.

Spinning reserves is another major opportunity. If a GW coal or nuclear plant goes down, a utility needs to find a new GW of power online in ten minutes. If you are an energy aggregator who can guarantee that GW 24/7 year-round you can make money every day of the year, even if reserves are rarely needed. A utility might pay $20 MWh for spinning reserves.

Ken Huber, Manager Advanced Technology for PJM, an independent systems operator (ISO) PJM, told me that they had 30 incidents last year that required the use of spinning reserves. On average, the reserves were only needed for about ten minutes. PJM is an energy wholesaler with over 550 member companies that serve 51 million people services in 13 states. On a typical day they are providing 100 GW of electricity. They can handle a 144 GW peak load.

These premium ancillary services can cost-justify early adoption of V2G. A decade from now, less valuable peak and base-load delivery of electricity from electric car batteries may add to the economic value of V2G.

Utilities and their air quality regulators would like to get rid of dirty peaker plants that may only be fired up a few hundred hours per year, when temperatures soar and air conditioning blasts cold air. Dr. Tomic estimates a peak power value of 5 to 80 cents per kWh. For those afternoon peak hours, utilities might offer 2 to10 cents per kWh.

100 V2G cars in Delaware is only a beginning. Fleets will be early adopters of V2G. In the United States, fleets currently have over 20,000 light-electric vehicles in operation. These same fleets will be candidates for new freeway-speed electric vehicles with V2G. Early adopters will include other universities, corporate leaders, and government organizations. The U.S. Post Office, if it secures funding support, may convert part of its 220,000 fleet to electric delivery vehicles with V2G. Utilities with thousands of cars and heavy-duty trucks are perfect candidates for early adoption of V2G.

A New Breed of Energy Service Providers

Electric cars, smart grids, and needed grid available storage will attract a agile innovators, many with deep pockets. Ken Huber of PJM identified a number of potential aggregators that include energy storage providers such as CAES which currently provides PJM with one MW of lithium-ion battery storage; smart grid providers such as IBM, Microsoft, Google, and Cisco; vehicle service providers such as GM OnStar, Grid Point, and Better Place; and demand-response providers such as Comverge and EnerNOC.

Some energy providers will fight to be first to market with smart charging and V2G services. Others will be fast followers. Most utilities will leave the investments of capital and creating new business models to others. Some innovative utilities may directly offer their own V2G services – Duke, Edison, Sempra, Austin Energy, and Xcel come to mind. Electric car customers will benefit from the convenience, smart charging cost savings, and ability to make money with V2G.
The Grid is Ready for Millions of Electric Cars

“Electricity is the new vehicle fuel,” explains Dr. Will Kempton, Director, Center for Carbon-free Power Integration, University of Delaware. He is confident that the U.S. electric grid can support millions of electric cars that are likely to be added in the next decades. He observes that the U.S. total grid load is about 417 GW. If all U.S. cars will converted to V2G plug-ins with an average of 15 kWh per vehicle, they would provide 2,865 GW. A U.S. fleet of electric vehicles could provide 7X entire electricity needed in U.S.

The average U.S. car is parked 23 hours per day. If most charge off-peak and only 20 percent are available for V2G at any given time, V2G will be a major contributor in energy security and more affordable electricity. A brighter future will be created by early adopters of electric vehicles, utilities with renewable energy portfolios, and a new breed of smart grid and V2G service providers.

John Addison publishes the Clean Fleet Report and speaks at conferences. He is the author of the new book – Save Gas, Save the Planet – now selling at Amazon and other booksellers.

If Letterman Covered CleanTech….

by Richard T. Stuebi

Since he launched his late-night run in the early 1980’s, the staple of David Letterman’s show has been his nightly Top 10 list.

I haven’t yet seen Letterman profile the Top 10 in the cleantech space. (Then again, nowadays I’m usually asleep far before his show begins.) But, if Letterman were ever to explore this area, Shawn Lasser of Sustainable World Capital has already done the work.

In this recent article, Mr. Lasser identifies the 10 states that are leading the cleantech race. In his view, the Top 10 are:

  1. California, based largely on its dominant share of cleantech venture capital activity and its pathbreaking law requiring greenhouse gas emission reductions
  2. Texas, due to the boom of wind energy deployment there
  3. Massachusetts, owing to the research powerhouses of MIT and Harvard
  4. Colorado, as evidenced by the impressive growth in the number of cleantech firms and jobs
  5. New Jersey, reflected by its ambitious solar energy requirements
  6. Tennessee, given the two $1+ billion polysilicon plants being built there to support the PV industry
  7. Pennsylvania, giving credit to Governor Ed Rendell’s leadership in establishing friendly advanced energy policies
  8. New York, particularly for its energy cluster-building initiative, New Energy New York
  9. Ohio, in recognition of its manufacturing capabilities for wind and solar energy
  10. Oregon, mainly for Portland’s sponsorship of progressive environmental policies

The big surprise on this list is Tennessee. Frankly, I think it’s an overstatement to claim Tennessee is an important factor in cleantech. The two aforementioned polysilicon plants probably ended up in Tennessee mainly because they were likely able to obtain electricity dirt-cheap from the Tennessee Valley Authority – an advantage gifted to the state from the Federal government 75 years ago. These two factories do not a cleantech cluster make.

Although it earned an “Honorable Mention”, the glaring omission on this list is Michigan. This simply will have to change: in recent weeks, Michigan has lured General Electric (NYSE: GE) to establish a major R&D facility near Detroit, and the Obama Administration has granted over $1 billion in grants to advanced battery interests in the state. With NextEnergy being a key facilitator, expect Michigan to become a major player in the cleantech arena.

Looking back on this list, it’s not particularly humorous, so Letterman would have to be pretty darn creative in making a good schtick out of the cleantech space. But, thanks nonetheless to Mr. Lasser to providing some interesting food for thought.

Richard T. Stuebi is the Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and is also the Founder and President of NextWave Energy, Inc. Effective September 1, he will also become Managing Director of Early Stage Partners.

Cap-and-Trade: How it works and why it’s the been the option of choice

In the run up to Copenhagen and the debate over Waxman-Markey, I think it’s worth laying out some of the key debating points on how cap and trade works and why it’s been our weapon of choice to date in the climate change fight.

I like to think of our carbon and energy problem as follows. We built the first industrial economies and long term economic growth model in all of human history in the last 200 years on a cheap, available energy base, in part by effectively running down our existing inventories of energy stocks from the least cost to the most expensive. We now need a lot more inventory each year (since we’ve been successful and are a lot bigger), and we’re into the expensive layer of our inventory, so it’s hitting our global cost of goods heavier than before. And we know we need to find more sources to replenish inventories, and we know that if we move immediately to higher cost sources we’ll pay the price in GDP.

We also know that producing and using those inventories had a non zero (and we argue about the level) cost to our environment that we have not measured well, but have been working on reducing for the last three decades. But we’ve now run into a new part of that cost with carbon or GHGs that’s very large, and is going to take a much larger and bigger hit to take care of, and depending on your view, has an aggressive time fuse on it. Essentially this means pricing carbon into our economy – which will basically add a whole new cost in all of our supply chains, a cost that varies from country to country and industry to industry, and will shake up comparative advantage in trade. And because it’s global, as far as the environment is concerned, for carbon, unlike most environmental pollutants, it doesn’t matter where in the world it’s emitted or reduced. So our problem is China’s problem is Europe’s problem is our problem.

So we start with a first climate change goal: to reduce the carbon emissions levels in the economy, by a level that we all debate by a point in time that we all debate. But we have to realize that while we do this, we do need to replace those energy supply inventories to both keep us where we are in GDP, and find new ones to sustain growth, or we’ll solve our GHG problem simply by being really poor. And we have to remember that adding costs has to be paid for, and it isn’t “business” that pays for it, it’s us, with business as our proxy.

So my corollary is the goal should be to squeeze carbon emissions out of the global economy in the fastest, least cost path, and as fairly as possible. Sorting out what that means and how to do so is the rub. But part of fair should mean a “do no harm” principal for the economy as well as the environment – meaning that when we start, as far as possible no country or group or industry or company within industries gets penalized out of the gate without either compensation or enough time to adjust. Think of it like eminent domain. If we give something up to the greater good, we deserve to get paid for it.

We have two main ways to go about it, place a tax or penalty on the emissions, or constrain the emissions factors (like power generation, driving, etc.) Cap and trade is essentially a hybrid of the two. The cost of such carbon reduction, because of the ubiquitous nature of carbon, and typically inelastic demand curves for most energy and carbon intensive products, is spread across all consumers in any scenario, but depending on system design can be borne disproportionately by some groups, industries or countries. Our special challenge is because of that global nature, we literally HAVE to have a solution that can engage and work in every country. Unlike cleaning up a local toxic spill, where we can fix ours without our trading partners, in carbon, if China fails, we fail. So if we try and succeed, and China does not try, the environment loses, and we lose worse.

Carbon Tax – Basically with carbon tax the government picks a series of carbon intensive industries or products, assigns a carbon value to them by one of a number of methods, and levies a tax on them. It’s often touted by economists as theoretically the cheapest method, and generally an industry favorite because they know how much they’ll have to pay and can plan.

But carbon taxes have big drawbacks. You can’t be sure you’ll actually get the level of reductions you want, because the tax fixes price, not volume. Worse, carbon is a global problem, and getting global tax codes to mesh together is virtually impossible (we can’t even do it inside the US), which means we may end up with everybody paying a different price of carbon and a complete mess. That certainly would throw the efficiency argument out the window. The next big disadvantage is that if you don’t get the tax level and structure exactly right, businesses and consumers get hurt in unpredictable ways, and have little room to adjust if we get it wrong. So while theoretically better, it’s not a very “fault tolerant” plan.

Main advantage is that you have a known cost to industry (which is why most industry prefers tax to trade or command and control). Next main advantage is that the the government gets lots and lots of revenue, which is why many politicians favor it.

The second option is classic environmental “command and control”, if you’ll excuse the perjorative sounding nature of that term. Esstentially the EPA or equivalent simply regulates every one who produces GHGs, and tells them how much they can produce through a permitting process.

The advantage is that you know exactly how much emissions reduction you are going to get. The disadvantage is that you may pay much more than you thought, and sink your economy, especially if your trading partners are more lax on either regulation or enforcement, and you let the EPA pick the winners and losers. The other disadvantage is that there is no upside. Under no circumstances will you ever get more reductions than you thought, unlike cap and trade, where done right, you may.

Cap and trade is the middle ground (which is why it keeps coming up). With cap and trade, the system operator (UN, EU, EPA, CARB etc) designates how many credits can enter the system, and prints, them like money. It then designates how many credits a company must turn in each year or period per unit of production (ie 0.5 tons/MWH of power produced), and penalizes or shuts down the company if they don’t turn in enough to meet their obligation. So no more emissions from a regulated sector will occur than credits (often called allowances) exist.

Then the regulator decides whether to sell the credits to the industry that needs them, or to simply allocate them (often based on some measure of current production). Both methods have pros and cons, and in practice have nothing to do with environmental protection or the price of carbon (the total level of credits and the relative level of credits to demand sets that) and more with subsidizing one industry vs another, or collecting revenue for the government.

Finally, the regulator can let offset credits be produced from the remaining unregulated sectors (or from inside a regulated or “capped” sector if appropriate adjustments are made), and sold to the emitters (it simply adjusts the cap so that the total level is where we want it to be). The advantage of this is that the regulations can be phased in easier, and we get a more equal price of carbon.

And what happens is that in unregulated sectors any time potential reductions exist (eg, a very inefficient emitter that could be shut down or run more efficiently), carbon developers pay up for the rights to the reduction, and that emitter finds it’s more profitable to do the right thing. The downside is that it looks like emitters are getting a profit off emissions. In reality, they are getting paid to reduce emissions for you and I, at just the right price.

Then emitters and financial parties buy and sell these credits from the government or each other or develop offset credits in a race to pay the least. And since the regulator starts reducing the number of credits it puts into the system, it’s kind of like musical chairs, the slowest, most carbon inefficient company gets left out and has to shut down, or shifts to a lower carbon production in order to stay in business.

The main advantages of cap and trade – 1) it assures us that we will meet our target goals like command and control 2) but it allows industry the flexibility to figure how to meet them cheapest (which is good for all of us), 3) it tells us what the real price (or cost) of carbon actually is, 4) and it’s better at equalizing the price of carbon so everyone pays the same across different industries and geographies, 5) in practice it costs less, and is easier to implement in a multicountry environment than command and control or tax.

Main disadvantages, it takes some time to get up and running, and makes it look like (not really true), that emitters are making money off it. Trust me, if they thought it was a profit center, they’d be all over it. The final disadvantage is it depends on the government operator to manage a market, something where we’ve had some good success (like NOX and SOX trading and up until recently the Fed), but can be susceptible to politics as usual.

In essence, you can think of cap and trade as a carbon tax with a tax rate that varies with the market (going up if industry is worse at producing carbon reductions than the government thought and down if they are better, and similiarly going down when the economy is bad and we can’t afford it and up when the economy is strong) and a tax base that is higher for emitters and emissions intensive industries than for those more efficient.

In any case, all three options need a lot of money spent on new technology and good measurement and verification. All three options will be expensive, and will be paid for by you and I at somepoint. And in practice, we are doing all three options to varying degrees right now.

Neal

Getting Smart About Agriculture

Nine months ago, I joined Terraqualo, a new startup aimed at helping growers of specialty crops make best irrigation decisions, using a cost-effective wireless network of sensors and actuators. In this new weekly column on “Sustainable Agriculture on Cleantech Blog”, I will share some of the lessons I have learned, and invite you to contribute as well in the form of comments. 

Whether you are an investor looking to invest in an agriculture technology startup, or an engineer with a high-tech idea for agriculture, eventually, you are going to need to do your homework, and understand the business of agriculture. As I have discovered, getting into the field of agriculture high-tech  requires the ability to grasp multiple disciplines, and a good dose of humility. Before you go out and talk to the experts, UC Davis professors, farm advisors, commodity groups, and growers, I suggest you get smart very quickly, using the vast knowledge available online. Here are some of my favorite sources,
USDA websites:
  • NASS (National Agricultural Statistics Service)
  • ARS (Agricultural Research Service)
  • NRCS (Natural Resources Conservation Service)
  • ERS (Economic Research Service)
  • Census
UC  ANR (Division of Agriculture and Natural Resources) 
Scientific papers:
Farmers’ publications:
Happy research!
Marguerite Manteau-Rao is VP Marketing for Terraqualo, a new venture in precision irrigation for growers of specialty crops. Marguerite is the creator of  La Marguerite, a popular environmental blog, and has written extensively for a number of other blogs, including Huffington Post Green. She has a multidisciplinary background as an engineer, marketer, and  social worker. You can follow her on Twitter .

New Cars that Already Meet 2016 Fuel Economy Standards

By John Addison. President Barack Obama announced that automakers must meet average U.S. fuel-economy standards of 35.5 miles per gallon by 2016. This will be an exciting opportunity for automakers that already deliver vehicles that beat 35.5 mpg such as the Ford (F) Fusion Hybrid, Mercury Milan Hybrid, Toyota (TM) Prius, Honda (HMC) Insight, Honda Civic Hybrid, and the Mercedes Smart Fortwo. You can buy these gas misers today. A number of other vehicles offered in the U.S. now come close to the 2016 standard, and will see mileage improvements next year.

In Europe, over 100 models can be purchased that meet the 2016 standards, thanks to the popularity of cars that are smaller, lighter weight, and often use efficient turbo diesel engines.

Over the next three years, dozens of exciting cars will be introduced in the United States. Here are some offerings that we are likely to see in the next one to three years from major auto makers.

Ford (F) will extend its current hybrid success with added models. During my recent test-drive of several vehicles that meet the 2016 requirement the midsized Ford Fusion Hybrid demonstrates that you can enjoy fuel economy in a larger car with comfort and safety. The Ford Fusion Hybrid has an EPA certified rating of 41 mpg in the city and 36 mpg on the highway. The car can be driven up to 47 mph in electric mode with no gasoline being consumed. Ford will start selling pure battery electric vehicles next year that will lower its fleet mileage average.

The best mileage SUV on the market is the Ford Escape Hybrid with 32 mpg. In 2012, Ford will also offer a plug-in version of the Escape Hybrid that will blow-away the 35.5 mile standard. Bringing the popular Fiesta to the U.S. with a 1.6L gasoline engine will also attract budget minded buyers looking for good mileage.

In discussing the new standards, Ford CEO Alan Mulally stated, “We are pleased President Obama is taking decisive and positive action as we work together toward one national standard for vehicle fuel economy and greenhouse gas emissions that will benefit the environment and the economy.”

General Motors (GM) plans to be the leader in plug-in hybrids starting with the Chevy Volt. It has a major opportunity to extend its E-Flex architecture to SUVs and trucks by 2016. For the price conscious buyer, the Chevy Spark hatchback with a 1.2L gasoline engine should deliver over 40 mpg.

There are almost 40,000 Chrysler GEM electric vehicles in use today. The GEM 25 mph speed limits them to only being popular in fleets, university towns, and retirement communities. Chrysler will extend its early U.S. electric vehicle leadership in 2010 with new freeway speed plug-in hybrids that can be driven 40 miles in electric mode, before engaging the gasoline engine – the Jeep Wrangler, an SUV, and the Town and Country Minivan. Over time, Chrysler can expand its ENVI family. Chrysler’s new stockholder Fiat will bring in exciting smaller cars and help expand the EV success.

Toyota (TM) will expand on the success of the Prius with more new hybrids. Since 2002, I have been driving a Prius that has averaged 41 mpg in real world driving that has included climbing hills with bikes on a roof rack and driving through snow with skis on the roof rack. The Prius will also be made available as a plug-in hybrid – hundreds of these PHEVs are now being tested by fleets. The modestly priced Yaris, which gets 32 mpg, is likely to also be offered as a hybrid that delivers over 40 mpg.

Honda (HMC) is likely to be the first maker to meet 2016 CAFÉ requirements, building on its historical leadership in fuel economy. My mother has easily achieved over 45 mpg with her Honda Civic Hybrid. Now Honda is going after the Toyota Prius with the Honda Insight. The popular Fit, which gets 31 mpg, is likely to also be offered as a hybrid offering over 40 mpg. Look for more high mileage offerings from both Honda and Toyota as they compete for hybrid leadership.

Nissan’s (NSANY) Altima Hybrid delivers an impressive 34 mpg. Beyond hybrids, Nissan is determined to be the leader in battery electric vehicles. Working with fleet consortiums and major electric utilities, next year Nissan may seed the market with thousands of freeway speed electric vehicles. The Nissan EVs have ranges of at least 100 miles per charge. Clean Fleet Report EV Test Drive

This article does not pretend to be a complete review of what is coming, rather a taste of what is here and what will soon be here from six major automakers. Given economic challenges, not all forecasts will happen. There will be surprises, more new models, and new model names. Not all plans will be executed as Chrysler deals with bankruptcy reorganization and as GM considers one.

Meeting the CAFÉ standards by 2016 will not be a slam dunk for all of the automakers, but they will make it. Historically, CAFE standards have not aligned with the EPA fuel economy determinations used in this article. For better and worse, flexfuel vehicles get artificially high numbers, making it easier for GM, Ford, and Chrysler to meet CAFE targets. Plug-in hybrid and EV ratings need to be finalized. To meet fleet average requirements, cars will need to average higher than 35.5; light-trucks and SUVs lower.

Trends to more efficient drive systems are a certainty. With oil prices now close to double the recent lows of earlier this year, these new vehicles bring important relief to every driver who wants to save at the pump.

John Addison publishes the Clean Fleet Report and details the future of transportation in his new book Save Gas, Save the Planet.

High-Speed Rail Unlocks Intermodal Potential

By John Addison. Intermodal solutions allow people to effectively navigate major cities such as New York, Washington D.C., Paris, Madrid, and Tokyo. Subway and light-rail are especially effective, but expensive to build. As cities grow, change, and morph, not every potential route can be served with subway and light-rail. Bus rapid transit is a cost effective way to duplicate some of the benefits of light-rail, at a fraction of the capital expenditure. Buses, taxis, car sharing, bicycling, and walking are all parts of the solution. For many, cars are their preferred way to get around, yet if all transportation were cars then cities would be frozen in gridlock.
High-speed rail integrates all these systems together and moves people from city to city at high-speed. When the distance is only a few hundred miles, high-speed rail coupled with city transit beats airplane and car every time.
Now an 800 mile high-speed rail network is being started in California. Because it depends on local and public-private partnership funding, as well as state and federal funding, it will be built in sections. First online are likely to be areas that are currently overwhelmed with passenger vehicles crawling on freeways that should be renamed “slowways.” Likely to be among the first in service are the Orange County – Los Angeles section and the San Jose – San Francisco section.
San Jose provides an example of current transportation problems as well as the future promise of high-speed rail integrated with intermodal solutions. Currently, during rush hour, cars crawl from all directions into San Jose, the self-proclaimed capital of Silicon Valley. Vehicles overload some of the nation’s busiest highways – 680, 880, 101, 280, 87, and 17.
Commuters to and from San Jose have a number of options. Many require multiple transit agencies and added time to reach their destination. Caltrain services cities from San Francisco to San Jose, at times taking only an hour, at other times being less frequent and taking much longer. Several transit agencies have special commuter shuttles including AC Transit and Santa Cruz Metro.
Major San Jose employers promote carpool and van pool commute programs. Shuttle buses run to the nearby airport. Santa Clara Valley Transit Authority’s (VTA) light-rail and buses effectively cover major parts of the city and connect to other systems. A variety of private bus, shuttle, car sharing, taxi, and other services all help. A network of bicycle trails and paths helps some enjoy their commute and stay in shape.
A central hub for VTA, Caltrain, and Amtrak is the Diridon Station in San Jose, named after Rod Diridon who provided leadership for the modern transportation system in the greater area as six-time chairperson of the Santa Clara County Board of Supervisors and Transit Board. He has also been chair of the American Public Transit Association; he is the Executive Director of the Mineta Transportation Institute and Chair Emeritus of the California High-Speed Rail Authority (CAHSR).
When I met with Rod Diridon last month he was optimistic about CAHSR breaking ground within two years, and carrying a high volume of riders on at least one segment within ten years. The reasons for success are compelling: high-speed rail is less expensive than freeway expansion, less expensive than airport expansion, secured voter approval during a severe recession, will create up to 400,000 new jobs, integrates all of California’s major transit systems, reduces petroleum use, and helps prevent increased climate change damage. Mr. Diridon feels that support is also strong, because each year of delay could add millions to the ultimate cost of the 800 mile system.
In ten years, the Diridon Station is likely to see high volumes of travelers as high-speed rail shuttles people to and from San Francisco in 30 minutes. The CAHSR system will share the corridor currently in place for Caltrain. The station will allow passengers to board Amtrak and continue on to places like Los Angeles and Sacramento. Eventually, the high-speed rail will continue to those destinations, as all right-of-way and not-in-my-backyard (NIMBY) issues are resolved.
In ten years, increased VTA light-rail traffic will flow through the system as San Jose continues to grow. VTA Transportation Planner Jason Tyree described how light-rail will be supplemented with advanced bus-rapid transit that will rapidly move people with modern features such as level boarding, automated fare handling, signal prioritization, and potentially dedicated lane sections. The 60-foot buses will be hybrid diesel.
People from the East Bay area may connect to the station via an extension to BART. Feeding off BART will be AC Transit’s ultramodern buses including its expanded fleet of hydrogen fuel cell buses.
The Diridon Station ten-years from now could well have zero-emission electric bus shuttles from the nearby airport or even a more advanced people-mover service. Preferred car parking at the station is likely to be for electric and plug-in hybrid vehicles. San Jose, home to advanced vehicle and technology companies like Tesla, is committed to an extensive city-wide vehicle charging infrastructure.
Although many electric vehicles are criticized for only having less than 100 mile in range per battery charge, such range is good for several days when combined with effective public transportation systems. Another way to cover the last miles to and from home and work is the good old bicycle. Bicycle boarding will be permitted on high-speed rail and the other public transportation systems.
As cities are connected with high-speed rail, similar multimodal systems will also be connected in San Francisco, Los Angeles, Orange County, San Diego, Sacramento, and other major cities in this state of 40 million people; soon to be 50 million people.
The new high-speed rail and the light-rail transit systems use electricity not petroleum. Electric rail is many times more efficient than diesel engine drive systems. In ten years, by law 33 percent of the electricity will be from renewable sources such as wind, solar, and geothermal. In 20 years, especially with the benefit of California’s new cap-and-trade of greenhouse gases, renewable energy is likely to be less expensive than natural gas and nuclear, with coal already being phased out in California. In other words, the high growth part of California transportation is likely to be zero-emission providing significant relief in emissions and energy security.
Combining improved multimodal transportation with high-speed rail with renewable energy is bringing climate solutions just in time. California’s busy Highway 101, which stretches over 800 miles and which carries millions daily, will find major sections under water if the sea rises only 16 inches.
As leading delegates from 175 nations now meet to discuss climate solutions scientist agree that global warming is accelerating and the artic ice cap is disappearing.
The multimodal transportation that serves millions of Americans is experiencing record use and provides the foundation for a more promising future.

John Addison is the author of the new book – Save Gas, Save the Planet.

Robert Metcalfe Is Wrong, Clean Technology Alone Will Not Work

by Marguerite Manteau-Rao

I got a sneak preview of Scientific American’s Earth 3.0 special issue on ‘Solutions for Sustainable Progress’. Mostly great stuff, with the exception of one article, that prompted me to write this rebuttal.

In ‘Learning from the Internet’, Robert M. Metcalfe, venture capitalist and Internet pioneer, expands on the dangerous idea that,

I don’t think for a moment that we’re going to conserve our way out of the energy crisis. Internet history shows that prosperity depends on abundant bandwidth. Prosperity (gross domestic product, per capita) is proportional to energy use. We are not going to lower per capita consumptionof energy in the U.S. We are going to enable the rest of the world to be as prosperous by using not less but more energy. We need to make energy cheap, clean and therefore abundant – really abundant, for a really long time.

Sounds familiar? This is the same kind of thinking endorsed in an earlier McKinsey study, and also to a lesser extent, by Al Gore in his Moon Shot Challenge speech.

Makes me mad. The average citizen is already confused enough. The last thing we need is more tenors in green tech and green biz to lull us into thinking that technology will get us out of our mess. Besides, I do not see what climate change has to do with the Internet.

We need to get out of this pervasive either-or thinking. Energy conservation and new energy technologies are not mutually exclusive. Instead, they are meant to work together. One without the other will not work. It’s a matter of simple maths, and of mitigating our risks, in the unlikely event that technology does not deliver on all its promises.


Marguerite Manteau-Rao is a green blogger and marketing consultant on sustainability and social media. Her green blog, La Marguerite, focuses on behavioral solutions to climate change and other global sustainability issues. Marguerite is a regular contributor to The Huffington Post. You can follow her on Twitter.

Drive as green as the inside of a kiwi

by Cristina Foung

My favorite green product of the week: the PLX Kiwi Fuel Saving Device

What is it?
The PLX Kiwi is basically a fuel efficiency monitor for any car. It’s an on-board display that shows you quite a bit of information, including your miles per gallon and how much you spent (or saved) on fuel in a given trip.

Why is it better?
Before the Kiwi, you might have been guessing at your car’s fuel efficiency. But now, you can see your MPG at the exact moment you’re driving. It gives you real time feedback which helps you adjust your driving style to maximize your fuel efficiency and minimize your carbon footprint (and save money). Just don’t keep your eyes on the Kiwi and forget about the road.

The Kiwi also comes with another nifty feature. It’s called the “Drive Green” mode. This setting lets you run through different driving lessons. The lessons teach you strategies to maximize smoothness, acceleration, and deceleration (among other things).

By making drivers more aware of their habits, their fuel economy, and their potential gas savings, the Kiwi helps cut gasoline consumption and therefore emissions. Now mileage monitors are no longer just for Prius drivers.

Where can you find it?
You can get the Kiwi for $299 directly from PLX Devices.

Besides her green products column on Cleantech Blog, Cristina is a passionate advocate for green living at the Green Home Huddle at Huddler.com, which focuses on electric cars, organic personal care, and other green products.

A Swash(buckling) Bidet Seat

by Cristina Foung

My favorite green product of the week: the Brondell Swash Ecoseat Bidet Seat

What is it?
The Swash Ecoseat is a bidet seat. It gets installed in place of your traditional toilet seat and has a control panel to help you select the water direction and flow. The Swash Ecoseat has two retractable “cleansing wands” which are self-cleaning. The seat also has a body sensor, so it can tell when you’re not seated and will automatically shut off the flow of water. The seat operates with only 4 AA batteries.

Why is it better?
By nature, a bidet seat does use more water per use than a standard toilet. However, a standard toilet without a Swash Ecoseat also requires toilet paper. The Swash Ecoseat was designed to reduce toilet paper use by 75%.

According to Brondell, in one day, Americans use 34 million rolls of toilet paper. But in order to make all that toilet paper, there are a lot of resources required (221 thousand trees, 255 million gallons of water, 161 million kWh of electricity). Just imagine offsetting 75% of that toilet paper use – it would reduce greenhouse gas emissions by 33 thousand tons.

Besides some serious resource conservation, the Swash Ecoseat is simply more hygienic. The only thing you have to touch with your hands is the control panel.

I can tell you from personal experience, the seat is really comfortable and the water pressure is quite strong. At the Huddler office, we experimented getting around the body sensor to see what was really going on. There’s even a Swash Ecoseat video to prove it.

Where can you find it?
You can buy the Swash Ecoseat (and a variety of other bidet seats) directly from Brondell for $360.

Besides her green products column on Cleantech Blog, Cristina is a passionate advocate for green living at the Green Home Huddle at Huddler.com, which focuses on electric cars, organic personal care, and other green products.

Are Clean Tech and Sustainability Types Afraid of Web 2.0?

by Marguerite Manteau-Rao

Social media and sustainability may align in at least ten ways, according to Max Gladwell, but they certainly do not intersect very much in actuality.

Proof is this quick search I conducted on Twitter, of last 24 hours of business conversations on “sustainability”, “clean tech” and “green”. Here are the results. I only kept original conversations, not automatic tweets:

19 tweets in 24 hours, that’s not very many. Of course, not all conversations on clean tech and sustainability got captured with my basic search. Still, it gives an indication of how little the green business folks are using social media. My experience of the green business people around me, is that they tend to be very engaged in real life networking, and not so much in virtual networks. This has a lot to do with clean tech and sustainability types’ lesser familiarity with Web 2.0 tools.

Marguerite Manteau-Rao is a green blogger and marketing consultant on sustainability and social media issues. Her blog, La Marguerite, focuses on behavioral solutions to climate change and other global sustainability issues. She also writes for the Huffington Post.

What’s the Buzz About Clean Tech and Other Green Stuff?

by Marguerite Manteau-Rao

Green or sustainability? Clean tech or environmental conservation? If you want to get a sense for what topics generate the most buzz at any point in time, Nielsen BlogPulse is the place to go:

‘Green’ is a word understood by all. Sustainability is still a concept for the business elite.  

I thought clean tech would have an edge over conservation. Nielsen statistics are proving otherwise. I find it rather encouraging. Note the peak on Earth Day, for conservation. Conservation is still very much associated with big environmental events.

Solar is still generating more buzz, ahead of other clean tech approaches. As more and more of the public discourse shifts towards energy efficiency, it will be interesting to see if it gets reflected in blogging conversations.


Now you play!

Marguerite Manteau-Rao is a green blogger and marketing consultant on sustainability and social media issues. Her blog, La Marguerite, focuses on behavioral solutions to climate change and other global sustainability issues.