Fifty Years

Earlier this month, I turned 50 years old.  Such milestones are natural occasions for reflection.

Beyond recalling many of the phases and individual episodes of my life, my reflection included a consideration of how the world had changed in the 50 years in which I had lived.  And, naturally, given my profession, I pondered what it would have been like to have been a “cleantech” practicioner 50 years ago, in 1962.

Frankly, it’s not really possible to imagine “cleantech” back then.  50 years ago, there wasn’t much “clean” and there wasn’t much “tech”.

In the U.S., the Clean Air Act and the Clean Water Act hadn’t been passed, and there wasn’t even an Environmental Protection Agency.  Silicon Valley was still mainly apple orchards, and computers less powerful than your smartphone barely fit into large warehouses.

In the energy sector, the U.S. still dominated the petroleum industry.  Not only did Americans consume more petroleum than anyone else (accounting for about 40% of world demand), U.S. oil production was still a major factor, representing almost 30% of worldwide production.

The oil industry’s operations would still have been very recognizable by John D. Rockefeller:  production was mainly from “conventional” onshore seesaw pumpers dotting the countryside; remote locations such as Alaska hadn’t yet been touched, nor had any material production yet been achieved from offshore wells.

Other than perhaps by watching the recently-released “Lawrence of Arabia”, few Americans paid much attention to the deserts of the Middle East in 1962.

Though unnoticed by most Americans, important forces in the oil industry were already beginning to shift in the early 1960s.  Although Texas oil production had been decisive in fueling the Allied victory in World War II just two decades previously, by 1962, the U.S. had become a net importer of oil.  Yet, only King Hubbert projected a future waning of American supremacy in oil production.

Oil prices in 1962 were a little less than $3/barrel, largely due to the price-setting powers of the Railroad Commission (RRC) of Texas, then still the source of a significant share of world oil production.  When a hitherto little-noticed group formed in the early 1960s called the Organization of the Petroleum Exporting Countries (OPEC) assumed the dominant influence in pricing oil a decade later, the world would change forever, as oil prices would never again be anywhere near below $10/barrel.

It’s almost quaint to summon up memories of the oil sector of the era.  Remember what filling up at a gas station was like in the 1960s?  The attendant would come out, put the nozzle in the tank (always with the filler behind the rear license plate), cheerfully wipe the windshield and ask “may I check your oil?”.  Looking out the window, I remember seeing “29.9” on the gas pumps.  That’s 29.9 cents per gallon — which seems almost surreal to us now, but remember, oil prices were then only a few percent of what they are today.

Of course, given the now-unbelievably appalling gas mileage of those Detroit beasts, usually under 10 miles per gallon, you still had to fill up about as often then as you do now.  Back then, it was all about horsepower — it certainly wasn’t about efficiency, nor about cleanliness.  (Nor, for that matter, reliability.)

Every once in awhile these days, I find myself behind a 1960s-vintage car at a stoplight, most often on a sunny summer afternoon.  When the light turns green, I am left in a thin cloud of light bluish smoke and the fragrance of octane and unburned hydrocarbons.  Odors of my youth.  You don’t see and smell that anymore — and I don’t miss it.

Thank goodness for a plethora of cleantech innovation during the past decades:  unleaded fuels, pollution controls and fuel injection systems.

And, let’s not forget that these advances were pushed by, only happened because of, foresightful proactive policies.

While the financial bonanzas and corporate/family dramas enabled by oil discoveries and production had thoroughly captured the American imagination by the early 1960s — consider everything from “Giant” to “The Beverly Hillbillies” — natural gas in 1962 was an afterthought.  Other than some use for power generation in Texas and Oklahoma (where there was no local coal resource), natural gas was mostly flared at the wellhead.  In many ways because (and many people now forget this) natural gas prices were then regulated at depressed levels, the companies that produced gas as a side-consequence from oil production didn’t see much value in making the investments necessary to collect it and transport it to markets.  In fact, natural gas was widely considered a nuisance in 1962.

Certainly, gas is no longer considered a nuisance.  In fact, it’s now being touted by politicians across the U.S. as the Godsend:  providing lower energy prices, lower emissions, higher domestic employment and reduced dependence on foreign energy sources.

No, the oil/gas industry — and those two fuels are today inextricably intertwined — is now much more aggressive in capturing and processing every Btu that courses through the markets.

In the late 1960s, our family lived in the Philadelphia area, and I remember being awed – almost scared, really – by the immense flames emitted by the refinery near the mouth of the Schuylkill River.  All those now-valuable hydrocarbons…gone, wasted, up in smoke.  You don’t see that anymore at refineries, thankfully.

Oil company practices have massively changed in the past 50 years to capture everything of possible economic value.  Of course, that’s the effect of a 30x increase in oil prices, driven by a worldwide search and race to find and produce new reserves to replace five decades’ worth of depletion of much of the cheap/easy stuff in the face of a tripling of global oil demand (mostly from outside the U.S.), counterbalanced by technological progress on a host of fronts over the span of five decades.

Today, oil is pretty consistently trading between $80-100/barrel, and while U.S. oil production has rebounded a bit to approach early 1960s levels, American production now accounts for less than 10% of world oil production.

But think about how low U.S. oil production would be and how high oil prices might be today if not for offshore oil production, directional drilling, 3-D seismic, and an untold number of other innovations produced by the oil patch in the last half-century to enable production from hitherto undeveloped places.

Of course, beauty is in the eye of the beholder, and not all of these developments are viewed positively by everyone.  The current debates about fracking and development of the Alberta oil sands would have been unimaginable in 1962.  At the time, fracking barely existed as a practice, and the Alberta oil sands were then hopelessly uneconomic as a source of fuels.  Moreover, there was virtually no environmental movement to give voice to the concerns of citizens.

It wasn’t really until Rachel Carson published Silent Spring just a few weeks after I was born that much attention was paid to pollution.  Later in the decade and into the 1970s came the grassroots emergence of the environmental groups, such as Greenpeace and the Natural Resources Defense Council.

If you are about my age or older, you may well remember this 1971 commercial.  The tagline (“People start pollution, people can stop it”) and the image of the Native American shedding a tear remain indelible decades later.

Before this, there was virtually no accountability placed on emitters, and anyone could pretty much dump whatever they wanted, wherever they wanted, whenever they wanted.  And, in the early 1960s, no set of interests benefitted from ongoing inattention to environmental considerations in the U.S. more than the coal sector.  For those with coal interests, the times before environmentalists were truly the glory days — and in 1962, the future for coal in the U.S. at that time was terrifically bright.

Sure, trains had just moved from coal steam to diesel-electric, but over half of all the electricity generated in the U.S. in 1962 was based on burning coal.  With burgeoning demand for electricity (especially to keep pace with the exploding utilization of increasingly-ubiquitous air conditioning), coal was poised for significant growth, as thousands of megawatts of new coal powerplants would be added to the nation’s energy grid each year during the 1960s.

While coal is certainly no poster-child for the cleantech sector today, back in 1962, coal remained a particularly brutish and nasty form of energy.  288 American miners were killed on the job in 1962, and all of the coal burned was subject to minimal pollution control – no electrostatic precipitators or baghouses to capture particulates (i.e., soot), much less scrubbers for sulfur dioxide or selective catalytic reduction for nitrogen oxide emissions.  You pretty much didn’t want to be a coal miner or live anywhere near a coal-burning powerplant, as your health and longevity were seriously at risk.

Indeed, some observers speculate that the uncontrolled emissions from powerplants (not to mention other industrial facilities, such as steel mills) threw up such large amounts of material into the atmosphere that the 1970s became a period of unusually cold temperatures — to the point that many scientists were projecting a future of damaging global cooling.  (Although the then-common theory of global cooling is now mainly forgotten, climate change deniers are quick to employ this prior dead-end of thought as one reason for dismissing the strong likelihood suggested by climate scientists that global warming is probably occurring today.)

Of course, the U.S. still mines coal, lots of it, to fuel lots of coal-fired powerplants.  Production in 2011 was 1.1 billion tons, more than double 1962 levels.  However, employment in the coal industry had fallen by over 40% during the same period.  (And, mercifully, annual fatalities have decreased by a factor of 10.)  The primary factors for these changes:  productivity increases due to new technologies (e.g., longwall mining), lower rates of unionization, and a shift from underground to surface mining (now accounting for nearly 70% of U.S. production).

With respect to the latter factor, Wyoming coal activity has exploded — now representing more than 40% of U.S. production — at the expense of Appalachia, whose coal sector is now but a shell of what it was 50 years ago.  The causes are simple:  the subbituminous Powder River stuff from Wyoming is much more abundant and cheaper to mine, and generally has much lower sulfur content to boot, than what is available from Appalachia.

On a broader level, coal is on the retreat in the U.S.:  while coal still accounts for almost 50% of power generation, this share is dwindling.  It seems as though U.S. coal production levels have plateaued at just over 1 billion tons a year.  While so-called “clean-coal” technologies may at some point provide the basis for a resurgence in the industry, the possibility of future growth certainly seems far from obvious today.

Many legacy coal powerplants – some of which remain in operation from well more than 50 years ago – are fading away.  Tightening emission requirements, particularly on toxic emissions such as mercury, are just one  competitive disadvantage facing coal; coal power is increasingly uncompetitive with cheap and cleaner natural gas powerplants and (in some places) wind and solar energy.

“Wind energy” and “solar energy”:  50 years ago, these would have been oxymorons.  Other than the minute niches of sailboats and waterwell pumping in the Great Plains, a good wind resource had virtually no commercial value in 1962.  At the same time, Bell Labs scientists were wrangling some with solar energy technologies — primarily for satellites – although a lot more attention was being paid to a related device called the semiconductor.

For energy, scientists were mainly working on nuclear power, moving from weapons and Navy submarines to powerplants.  The nuclear era was dawning:  electricity was going to be “too cheap to meter”.

The very first commercial nuclear powerplant, the relatively puny 60 megawatt plant at Shippingport in Western Pennsylvania, had been running for only a few years in 1962, though dozens of nuclear powerplants were just coming onto the drawing boards.  Visionaries were even talking about nuclear-powered automobiles in 1962.  (“Electric vehicles?  Puh-lease.  Batteries are for cheap portable Japanese radios.”)

Perhaps as a psychological defense mechanism to drown out the anxieties associated with potential Armeggedon from a Cold War missile exchange, such was the sense of optimism in the possibilities of the age.

Apparently, no-one could foresee Three Mile Island, Chernobyl or Fukushima at the time.

The future held boundless possibilities.  Back then, who needed to recycle?  To think about efficient utilization of resources?  To care about water quality or air quality?  There was always more and better, somewhere, to be had.  And we Americans would surely obtain it, somehow and someway.  It was Manifest Destiny, ever-onward.

This American philosophy may have confronted its limits early in my lifetime with the ultimate realization, brought home so vividly at the end of the 1960s by the first-ever images of the solitary Earth as provided by the Apollo program, that we’re all utterly dependent upon a finite planet in an infinite sea of otherwise-unpopulable space.  Earth Day followed in April 1970.

To commemorate this first Earth Day, I remember our second-grade class picking up scads of litter along the side of a section of highway.  Upon reflection, I am glad to note how much litter has declined in subsequent years — a case of how values can be reshaped and behaviors can be changed, if people are just a bit more conscious.

That’s a positive take.  However, one can reasonably look back on 50 years of the evolution of the energy sector and say, well, that not that much has really changed in America.

True, the basic structure of American life may not have changed too dramatically.

We still primarily live in single family dwellings, in suburbia, dependent upon cars that look more or less the same, fueled by gasoline available at stations just down the road.  The power grid is still there, powered by central-station powerplants; the light switches and outlets haven’t changed, with refrigerators still in every kitchen and TVs in every living space.

By all measures, Americans are still energy hogs, relative to the rest of the world.

Even so, I would assert that a lot has changed, at both the macro and micro-level, that have consequentially altered the trajectory of resource utilization in America from the path determinedly being travelled 50 years ago.

Admittedly, some of the changes we have experienced are a bummer:  niceties like summer evenings with the windows open are much rarer.  Nevertheless, I claim that most of the changes of the past half-century are positive – and can be attributed to a significant degree to what we now call “cleantech”.

Our energy bounty, improved so significantly by technological innovation, has been achieved while simultaneously improving environmental conditions in almost every respect.  Notwithstanding the substantial increase in carbon dioxide emissions, almost all other manifestations of environmental impact from energy production and use have dramatically improved in the past half-century.  Standards of living enabled by modern energy use, here in America and even more so in the rest of the world, have dramatically improved.

Moreover, the trends for further future improvement on all these fronts are favorable.

With the proliferation of improved technologies such as LED lighting, energy efficiency continues to advance.  Renewable energy continues to gain share:  wind and solar energy represented about a quarter of new U.S. electricity generation additions in 2010.  Citizen understanding of energy and environmental issues continues to become more sophisticated.

Beyond the forces specifically pertaining to the energy sector, a number of broader influences in U.S. society are improving the prospects for accelerating cleantech innovation and adoption.  Entrepreneurship is booming, consumerism is increasingly being called into question, capital markets are more amenable to investment in this sector and more capital is arriving accordingly, and the Internet makes an immense and ever-expanding pool of information freely available to enable better decisions.

Not to mention:  much of the opposition to a transition to the cleantech future emanates from people in generations that are older, that will die out in the next couple of decades, to be replaced by younger generations that are generally more supportive of increased cleantech activity.

So, while it’s easy to get discouraged by the impediments to cleantech progress on a day-to-day basis, over the long-view, it’s pretty apparent that big positive things can happen and in fact are happening.

50 years from now, in 2062, I hope to be alive and well at 100 and still contributing to the cleantech sector.  That may be overoptimistic.  But I don’t think it’s at all overoptimistic that we’ll see more changes, and more changes for the better, in the cleantech realm over the next 50 years than in the previous 50.

The End of Nuclear Power? Or Just the Beginning?

This week’s news: US NRC freezes decisions on new reactor, license renewal applications

“The US Nuclear Regulatory Commission voted unanimously Tuesday not to issue final decisions on granting licenses to build new nuclear power reactors and 20-year license renewals to existing ones, pending resolution of the agency’s waste confidence rule overturned by a court in June.

The commissioners, however, also ordered that NRC review of these license applications continue and that the agency’s Atomic Safety and Licensing Board Panel not accept or deny new challenges that may be filed in these proceedings relating to waste storage issues.”

Nukes in the US not dead of course, but the revival still on hold?


The post Fukushima nuclear future in Japan?  Still shut down, the replacement generation fleet still a patchwork.  The future is . . .?


And Germany?  Trying to get out of nukes puts intense pressure on gas (from Russia), renewables, and the grid.  As well as adds costs. Prognosis unclear.


Has Fukushima changed China’s nuclear energy ambitions? Or just its technology choices?


And exactly what are the costs for nuclear?  I will say generally, that on a cents per kwh basis, the broad lowering of interest rates benefits nukes better than any other form of power but hydro, given the combination of high portion of the of costs from the capital, and the high capacity factor.


So is the end of nuclear power’s 50 year challenge to coal power insight?  Or are we on the verge of a resurgence?  Situation unclear at best.

Report from Energy Innovation Summit

Last week, many of the leading minds of the cleantech world congregated in suburban Washington DC for the 2012 Energy Innovation Summit.

The Summit is mainly oriented as a showcase of some of the most interesting and promising technologies that have surfaced directly or indirectly as a result of ARPA-E:  the Advanced Research Project Agency for Energy, a subgroup of the U.S. Department of Energy that was launched in 2009.

Of all the cleantech conferences I’ve attended in the past 12 years, and there have been far too many, this was one of the best, for several reasons.

First, most of the speakers were excellent (= interesting + informed).  Often at these kinds of events, the roster is populated by some combination of bureaucrats that in actuality are mid-level paper-pushers and geeks that speak in such granular detail about science or engineering topics that no-one can understand.  Either way, the comments are usually delivered in monotone, to overeager junior audience members busily taking notes they’ll never read and dozing or smartphone-checking senior audience members that have heard most of the same boring nonsense before.  (Cynical, much?  Yeah, I know.)

In contrast, we got to hear from Dr. Steven Chu, the Secretary of Energy, who is arguably the most brilliant cabinet member of all time (having won the 1997 Nobel Prize in physics for the cooling and trapping of atoms with laser light).  Dr. Chu reiterated some of his recent stump speech on the need for technological leadership to maintain/enhance U.S. competitiveness in the global economy, and the risks encountered from the need to stay on the frontier (Solyndra, anyone?)

We got to hear from Dr. Arun Majumdar, the Director of ARPA-E, who is just about as smart and knowledgeable, and perhaps more passionate and dynamic, than Dr. Chu.  Just one nugget from Dr. Majumdar:  the design life of a utility transformer is 40 years, yet the average in-service age of transformers on the U.S. utility grid is 42 years.  (Yet another factor in the drive for the “smart grid”.)

We got to hear from Bill Gates – yes, that Bill Gates – who revealed a depth of insight and concern that one would only expect of someone who had been playing in the cleantech game and fighting the good fight for decades.  Sample observation from Gates:  “Energy innovation in the U.S. is underfunded by at least a factor of 2.”  Gates talked at considerable length about the need for more research in carbon sequestration and in nuclear – noting his interest in TerraPower.

We got to hear from the Fred Smith and Ursula Burns, CEO’s of Fortune 100 companies FedEx (NYSE: FDX) and Xerox (NYSE: XRX), along with Lee Scott, the former CEO of WalMart (NYSE: WMT), talking about how energy technology innovation is critical to these goliaths of business.

I couldn’t attend all of the sessions because of various other commitments, and I purposely avoided sitting in on the remarks of the politicos – including Bill Clinton, Senator Lamar Alexander (R-TN), and Representative Nancy Pelosi (D-CA) – because (a) I’m disgusted with the state of the political environment and discourse in the U.S. these days,  (b) I’m confident that these speakers have arbitrarily-close-to-zero to say that would be useful or relevant to someone trying to actually create value with new cleantech innovations entering the commercial marketplace, and (c) I had better things to do when they were talking.  But, what I did hear from the keynotes and panels I did attend was generally pretty interesting and informative.

The networking at the event was impressive.  Many of the leading cleantech venture capitalists were milling around, along with actually-empowered senior executives of leading industrial corporations sponsoring truly novel stuff in energy technologies.  I only wished the name tags were of a larger font, so I could better see the identities of some of the people I was passing by, knowing that I was missing connecting with someone I really wanted to get to know.

But perhaps the most important reason that the Summit was such a positive event for me was the quality of the technology innovations and innovators that exhibited at the show – spanning from university research projects to start-up ventures to large corporations such as General Electric (NYSE: GE), Boeing (NYSE: BA) and Cree (NASDAQ: CREE).

At times over the years, I feel like I’ve seen or heard pretty much everything in cleantech, which sometimes makes me wonder if everything that could be invented or needed to be invented was already being worked on.  An event like this put lie to this misbelief.  People were talking about exotic/crazy stuff like wireless electric vehicle recharging while roaming.

After just the first day, I could see that there were lots of promising technologies being worked on really big opportunities beyond the set I kept seeing over and over again.  Moreover, most of these initiatives were led by entrepreneurs that were not only committed but also much more competent and capable than the tinkerers that represented most of the cleantech innovation realm a decade or so ago.

My overall impressions of the Summit gave me good hope that we are making real progress in the cleantech world, and that there’s a lot more for me to do and be excited about in the decades to come.  I myself was recharged on the fly.

A Fusion Reactor Hollywood Could Love

Some latest scuttlebutt from the world of nuclear fusion has all the ingredients of a Hollywood thriller screenplay (and for those who remember Inside Greentech’s Greentech Avenger, you know I know scuttlebutt!)

There’ve been all kinds of cinematic ideas, and personalities, on the front lines of the crazy world of cleantech innovation. Wild claims from charismatic mad scientists abound.

So hearing word that a tiny company has potentially cracked the code of fusion energy and created a working megawatt-scale reactor that actually produces more power than it requires is something I’d normally dismiss as yet another tale from the lunatic fringe.

But, in this case, I trust the source. So, whether you believe nuclear energy is cleantech or not—and especially if you don’t—read on.

In researching a new Kachan report on new safer, cleaner nuclear technology, we interviewed dozens of scientists at nuclear research outfits like Flibe Energy, General Atomics, General Fusion, Helion Energy, Hyperion Power Generation, the International Thermonuclear Experimental Reactor (ITER), Invap, Lightbridge, NuScale, Ottawa Valley Research, QPower, Radix Power and Energy Corp, Rare Earth Extraction Co., Rhodia, Scandinavian Advanced Technology (SCATEC), Terra Power, Thor Energy, Thorium One International, Tri Alpha Energy and U.S. National Ignition Facility (NIF).

Most fusion organizations are pursuing big, capital-intensive tokamaks and other reactors. But one interviewee, in a face-to-face conversation in an exotic location abroad, told us of a small company he’s involved with that he claims has built a working 1MW fusion reactor the size of a rice cooker (though it’s dubious that approximation includes the requisite shielding, cooling, turbines, etc.) The company is now apparently in the process of building a 10MW version that it plans to trial in 2012.

If true, it would turn a lot of heads, in particular at organizations like the international €15 billion ($20.4 billion) ITER project, the multi-billion dollar U.S. National Ignition Facility, and smaller fusion companies like General Fusion, Helion Energy and Tri Alpha Energy. And maybe, just maybe, represent a new energy production paradigm.


A generic tokamak-based design for a fusion reactor. NOT the design employed by our secretive fusion company. ITER’s tokamak is 98 feet tall and is taking years to build. Administrators expect ITER to require somewhere between €30 billion ($41 billion) and €50 billion ($68 billion) to hit its goals by 2040. Illustration source:

More on the company in a moment. First, a quick primer on fusion:

Why fusion matters
Nuclear fusion has represented a Holy Grail of power potential since the 1950s. Fusion reactors, in theory, mimic the internal processes of the sun and other stars by fusing atoms. Typically, this means combining a plasma of hydrogen atoms into helium. This is in contrast to today’s fission reactors, which typically split solid uranium atoms. The fusion process would emit heat that would ultimately drive electricity generators and could serve many other purposes, such as keeping buildings warm and firing up high-temperature industrial operations.

The potential advantages of fusion are enormous. Compared to conventional fission, a fusion reactor theoretically ticks several very important boxes in today’s safety-conscious nuclear energy world. Here’s an excerpt from the fusion benefits section of our report on nuclear innovations:

  • It cannot melt down, so the potential for a radioactive leak is miniscule. Fusion tends to run on very little fuel, and the fuel stops fusing as soon as conditions become imperfect. Thus, a loss of power to the reactor would shut down the reaction, with no threat of runaway, uncontrollable events. While this would carry financial consequences, it does not pose the safety risk associated with conventional fission reactors, in which large volumes of fuel can carry on fissioning in an outage. In fission, if cooling and/or control mechanisms fail, meltdown can ensue, as happened at Fukushima.
  • It produces relatively little radioactivity. The levels are extremely low and very short-lived compared to the long-lived, highly toxic radioactive waste of conventional fission reactors.
  • Its waste poses little weapons proliferation risk. The waste that fusion produces cannot be used to make bombs, although some believe that the tritium that it breeds does pose a proliferation risk.
  • There are potential uses for fusion’s helium waste. Helium is widely used in the medical industry for, among other things, cooling the superconducting magnets in MRI scanners, and in welding.
  • Most components of a potential fusion fuel are plentiful. Most fusion projects aim to use deuterium and tritium. Deuterium is plentiful—it’s the stuff that Canadian CANDU “heavy water” reactors use as moderators in fission reactions. It occurs commonly in water. It’s so common in seawater that, according to fusion company Helion Energy, the potential energy in 1 barrel of seawater equals that of 700 barrels of oil. The other hydrogen isotope, tritium, does not occur naturally. Fusion fuel makers will have to obtain their first doses from either CANDU reactors, where it is a byproduct, or from other sources, like the weapons community. But the good news is that once fusion starts, it breeds its own new tritium.
  • It requires very little fuel. Most proposed fusion reactors rely on very small amounts of deuterium and tritium. ITER, the massive international fusion project in France, plans to deploy a mere 2 grams of deuterium and tritium at any one time in its 98-foot-tall reactor. By comparison, utilities typically load fission reactors with hundreds of rods of uranium at a time.
  • Fuel costs are low. If a year’s worth of coal carries a value of “1”, then the combined cost of the deuterium and tritium would be 0.0005. The uranium in fission would cost 0.1, significantly more than fusion fuel.
  • It does not emit CO2 or other greenhouse gases. While this is also true for fission reactions, it adds to the appeal of fusion as a baseload clean energy source.

If fusion sounds too good to be true, that’s because, so far, it has been. As of this writing, there’s been no independent verification that anyone has yet successfully built a working fusion reactor that can produce sustained energy greater than that put into it.

Enter our small fusion company. Our source, concerned he was telling us too much, initially wouldn’t even reveal its name.

The fission wonder down under?
As mentioned, this company and its story seem to have all the elements of a Hollywood thriller:

  • Harnessing the power of nature! The analogy most often applied to fusion is harnessing the reaction of the sun. But this company’s fusion reaction, fueled by deuterium and tritium, isn’t nearly as high temperature, our source claims, and is more “rooted in nature.” Specifically, the reaction is said not to require the high temperature, high pressure or accelerated particles of others’ approaches. “The key is not how many neutron hits you generate, but how you sustain them, how well you can control them.” For a 40-watt power input, the reactor is said to be able to generate a megawatt.
  • Exotic locales! The company is based in Australia. Why? “Everyone’s expecting big nuclear innovations to come out of China, or France,” said our source. But it’s replicated its intellectual property and technology “around the world in case they get infiltrated.”
  • Self-funded by mad scientist! The technology’s inventor has apparently tinkered with his design for 40 years, and self-funded the company’s early stages, reinvesting income from earlier lucrative inventions. Now, strategic investors are said to include family money, such as a Shanghai real estate baron and decedents of American industrialist John Pitcairn, Jr.
  • Culture of secrecy! The company’s secrecy about its actual progress makes Apple look sophomoric. In development since the 90s, it has sworn employees and investors not to let on how successful its research has been. It’s said to have retained the former head of Israel’s counter terrorism unit as its chief of security.
  • No to takeover offers! The company is said to have already fielded a buyout attempt by General Electric (NYSE:GE). The founder apparently didn’t want the invention owned by just one corporation, characterizing it an invention for mankind, apparently.
  • Requisite military involvement! The company is said to be secretly working with the Australian Air Force and Navy, and the U.S. Department of Defense, and aims to trial a 10MW version of its reactor in 2012 with an Australian utility.
  • Political and industrial upheaval! If fusion can be made to work at scale, it could indeed affect the world in profound ways. All the ingredients for drama!

More about this secretive company, and other companies working to radically improve nuclear power as we know it today, is available in Kachan’s new Emerging Nuclear Innovations report, just released. This 64-page report rounds up 6 months of looking carefully at the nuclear power industry for companies best placed to usurp big, conventional fission of the type that powers the 432 non-military nuclear reactors that exist worldwide today.

Beyond fusion, the report also looks at improvements in conventional light water reactors (LWRs), including boiling water reactors (BWRs) and pressurized water reactors (PWRs), use of thorium as a fuel in molten salt and solid fuel reactors, molten salt reactors (MSRs), fast neutron reactors (FNRs), pebble bed reactors (PBRs) and modular reactors.

So don’t write off the nuclear power industry after Fukushima. Despite last March’s meltdown in Japan, the World Nuclear Association believes that in the 33 countries that currently operate nuclear reactors, capacity will increase 52-200%, to between 559 and 1,087 gigawatts in 2030 (up from 367 gigawatts today). Among countries that don’t already use nuclear power, those with plans to do so could add another 30-123 gigawatts, and new potential entrants could increase that by yet another 13-140 gigawatts.

Expect that new, safer nuclear technologies—possibly even fusion—will be part of that growth.

This article was originally published here. Reposted by permission.

Japan’s Crisis Hurts Sales of Hybrid Cars and EVs

The people of Japan are courageously moving forward after the devastation of a 9.0 earthquake, a tsunami that ripped apart buildings and roads, and a nuclear crisis that now threatens their food and water. The Japanese economy depends in no small measure on the success of its automotive industry and its complex eco-system of component suppliers and service providers.

Just when gasoline prices are rising and hybrid cars are again hot sellers, the crisis is making hybrids and new electric cars tough to get. Let’s look at the impact on three big sellers of hybrids and electrics.

Toyota, Honda, and Nissan are hurt less than expected because they have diversified globally, including billion dollar plants and operations in the United States. The most advanced hybrids and electric cars, however, are first produced in Japan. Every supplier must be able to produce for new cars to be assembled in Japan. Once assembled, it will be challenging to move them across roads not ripped apart. It will take time to return shipping ports to normal after the recent tsunami tossed cars and railcars around like toys. Plants and operations require MW of electricity, now constrained by nuclear plant shutdowns.


Toyota reports that all 13 North American vehicle and engine plants are running normally, although overtime has been curtailed to maintain adequate inventories of parts that come from Japan. Toyota now makes 12 different models in North America, including high-volume vehicles such as Camry, Corolla, RAV4, and Lexus RX 350, and nearly 70 percent of all Toyota and Lexus vehicles sold in the U.S. are made in North America.

Suppliers in North America provide most parts and materials for Toyota’s North American-built vehicles. Toyota has temporarily stopped all Japanese production of vehicles, but it is restarting production of replacement parts for cars already sold and parts necessary for overseas production. In general, Toyota is seeing adequate inventories at most dealers.

Prius vehicles are built in Japan, Steve Curtis with Toyota told me that the Tsutsumi plant where the Prius is made was not damaged by the earthquake. Production depends on more than the plant condition. It depends on a complex web of suppliers, supply of electricity, roads that can be crossed by employees and trucks deliveries parts. Toyota has delayed 12 Japan plant openings until March 26.

The tragedy in Japan has not delayed the U.S. launch of the new larger Prius V Crossover SUV and the Prius Plug-in Hybrid, not the new Toyota small electric city car. It has delayed the launch of the Prius wagon and minivan models in Japan from the original plan for the end of April. Reuters  Article

Since the production of current Toyota and Lexus hybrids, depends on a complex supply chain, and shipment to the UnitedToyota Prius 37k 150x102 Japan’s Crisis Hurts Sales of Hybrid Cars and Electric Cars States depends on roads and ports, Clean Fleet Report forecasts that shipments of Prius and other hybrids will be delayed and reduced for months.

Only one of three Toyota hybrid battery plants in Japan sustained limited damage from the earthquake. The other two plants are located in central Japan and were not affected. Panasonic and Sanyo are Toyota’s primary suppliers of nickel metal hydride and lithium batteries; their production status is uncertain.

Car dealers are betting that the supply of hot selling hybrids will be tight, especially with gasoline costing $4 per gallon in parts of the country. Auto News reports that dealers that were averaging $1,700 discounts on the Prius are now getting $800 premiums.


Honda is globally diversified in manufacturing and suppliers. With nine U.S. plants, Honda has invested more than $12.7 billion in its U.S. operations. The company employs nearly 25,000 associates and annually purchases $12 billion in parts and materials from more than 530 U.S. suppliers.

For hybrids such as the Civic Hybrid, Insight, CR-Z and Fit Hybrid, Honda also heavily depends on Japanese suppliers, including advanced battery suppliers such as Sanyo. At the heart of the 2012 Civic Hybrid and Honda’s new electric cars are the lithium-ion batteries built at its Blue Energy join venture (JV) with Japan’s GS Yuasa; the battery plant is in Fukuchiyama, Kyoto, Japan.

Last week, Honda had announced plans to resume production of major Japanese plants on March 20. Now these openings are delayed to March 27 or beyond. Like all major manufacturers, Honda depends on a complex eco-system of suppliers and joint ventures. Some plants have been damaged and roads to move parts have been ripped apart.


Nissan has delayed March 21 plans to restart production of parts for overseas manufacturing and repair parts, based on parts availability from suppliers, at these plants Oppama, Tochigi, Kyushu, Yokohama, Nissan Shatai. Vehicle production will be constrained by inventory availability. The Iwaki engine plant remains closed.

LEAF battery 150x150 Japan’s Crisis Hurts Sales of Hybrid Cars and Electric CarsNissan recently shipped 600 Nissan LEAFs before earthquake and tsunami damage. At the Port of Hitachi, however, Nissan lost 1,300 U.S.-bound Infiniti and Nissan cars to the tsunami. Nissan had plans to soon have 10,000 LEAFs built at the Oppama plant. Now Nissan’s hopes of catching-up with U.S. deliveries of the Chevrolet Volt have faded in the near term.

Starting next year, Nissan’s Tennessee assembly plant will have the capacity to build 150,000 Nissan Leaf electric cars per year, and 200,000 lithium-ion battery packs per year. The lithium packs could also be used in future Nissan hybrid cars. The Tennessee battery production is by AESC, a joint venture of Nissan and NEC.

Once production returns to normal, U.S. shipments could still be delayed. Japan faces a fuel shortage. Fuel is needed to transport cars to ports, to run port drayage trucks and lifts, and to run ships. Even electric cars still depend on diesel to move them to market.

1,500 Reader Comments on Renewable Energy that will Really Work

Our Cleantech Linkedin Group, over 20,000 members strong, has had a seven month running discussion started by Robert Drummond entitled “Renewable Energy that will Really work”, asking for readers views on what’s practical in renewable energy.  Kind of crowd sourcing opinion and facts on the subject of renewable energy.  Robert’s discussion reached a staggering 1,500 comments this month.   It’s a real “cleantech democracy”, and a testament to the passion we all have for this sector, so I wanted to share it with you.  Throw your own comments in here or back on LinkedIn, but definitely participate!

Renewable Energy that will Really Work

By Robert Drummond

“I want to start a discussion about renewable and clean energy supply and distribution that will work in the forseeable future. I have read so much rubbish that I want to hear the views of people that know about each possibility and are not afraid to tell us all.

Since I have a lot of hang-ups and opinions that need to be checked I will fire-off first.

Renewable energy sources

Hydro. One of the best but not many places left in the world where it will make much of a difference. Some people hate dams so it isn’t universally loved.

Nuclear Fusion. This is the holy grail but seems too far away and even when it comes (if ever) it will be full of dangers and risks both real and political. The thought that it is just doing what the sun does appeals but I am not holding my breath.

Nuclear Fission. This is not really renewable and whether it is green or clean is equally debatable. Most major economies are renewing their commitment to it and it will play a bigger part in energy production in the future. The fear of mis-use of the technology and the huge capital investment and decommissioning costs will ensure that it never gets to become the big success that some would like.

Solar – Photovoltaic. This is the flavour of the year since everyone understands it and it seems to be as clean as you can get. Of course it does “pollute” the countryside and the materials used are not as benign as we would like but it works and is getting cheaper as the technology improves. This may be the first major alternative to pass the fully commercial test. However it is not portable and only works in the daytime. So we have to capture the electricity for use at night (or have alternative sources to match). Also it will not answer our prayers for a replacement to fossil fuels for transport until we have a better way of storing electricity efficiently with light weight devices.

Wind. I am told that the big problem with wind is that the off-shore farms (which everyone likes since they don’t want one in their own back-yard) suffer from three problems. Firstly the very large generators that are most efficient are extremely heavy and constructing them off-shore is mighty expensive. Secondly they are prone to damage and wear (particularly due to UV and salt and the problems of transmitting the rotary power to an effective generator). Thirdly the electricity is likely to be some way from the consumer which means loss in transit.
We also have the same problems about intermittant power generation and lack of portability of electricity.

Wave. Most of the technology is highly suspect and my friends say it wont work except in a limited local way with simple up and down pstons for pumping for uses such as desalination.

Tidal/Current. These seem quite hopeful but there are only limited places in the world with sufficient water flow to achieve anything worthwhile. Even if they succeed and do not foul-up or kill all the fish they will like hydro-electric soon run out of available good locations. They have the advantage of being hidden from view. Again the problems of intermittancy in most places and also they generate electricity.”

Join our Cleantech Linkedin group and view the 1,500+ comments here, or post in the Cleantech Blog comments below.

Predictions for cleantech in 2011

It’s December, and time for an annual reading of the green [tech industry] tea leaves. What will the new year have in store for cleantech?

From our standpoint at Kachan & Co., 2011 could be a strong year for the global clean technology sector. Seemingly, the markets have been correcting themselves in 2010; valuations are returning to rational P/E multiples, price signals are emerging again after massive government investment in cleantech, early stage deals seem to be returning, corporate investment is flowing, new funds are being announced everywhere. Outside the U.S., which is having an increasingly hard time supporting the sector, cleantech is alive and well, even in exits… albeit mostly in China.

While we’re calling a positive 2011 for the industry, the largest risk, to cleantech and every sector in 2011, will continue to be the spectre of another global economic slide: another massive economic “stair-step” downwards prompted by the continued and growing mismatch between global energy supply and demand, food supply and demand, ever-increasing debt and trade deficits, currency revaluation or political/military developments. Any one, or combination of these, could result in another 2008-scale financial crisis, or worse.

Yet, if none of the above make themselves felt, 2011 could be a solid year for worldwide cleantech. Here’s why, in our analysis.

Sustained worldwide VC investment in cleantech in 2011
Predictions of cleantech’s death, or bubble, are exaggerated, we believe. Kleiner Perkins may be looking to scale back its cleantech investing. But that doesn’t mean cleantech companies won’t be getting funded, or that the sector is on the downside of a bubble, as some have called it. The big drivers of cleantech remain: resource scarcity and the drive for greater efficiencies, the desire for energy independence, and (dare we say it?) climate change—the latter of which has taken a back seat of late. We predict these drivers—particularly the real or perceived scarcity around oil, rare earth elements and other commodities—will be felt even more acutely in 2011, especially as the Chinese middle class expands, further cementing the demand for and the market validity of clean technologies.

Much media attention was given to a downturn in cleantech investing in the third quarter of this year, in particular North America’s share of it. But doomsayers missed that there was still a fourth quarter in 2010 to report. And that worldwide, cleantech investment hasn’t fared that poorly in 2010. Indeed, as tracked below, 2010 venture investment in cleantech, even simply up to and including 3Q10, has already exceeded that of all of 2009.

Cleantech Investment 2010 YTD

Venture investment in cleantech in 2010, up to and including 3Q10, already exceeded that of all of 2009. The full 2010 total will be at least $1B higher when fully tallied and reported in 2011. That'll make it the second best year on record—hardly a bubble that's burst. Source: Cleantech Group

We believe venture investors will continue to chase opportunities in cleantech in 2011, investing robust amounts from record-level funds raised recently around the planet. Make no mistake: there’s plenty of capital being allocated for cleantech in 2011. Another $500 million has just been announced from the California Public Employees Retirement System (CalPERS). Hony Capital in China is closing in on a new 10 billion RMB ($1.5 billion) fund, and there’s a new €9b ($12.4b) NER300 fund for cleantech in the EU. And that’s just three of dozens announced in the last month.

Yes, there are concerns about exits and long time horizons in cleantech, but the sheer sizes of the addressable markets many cleantech companies target, and the possibilities for massive associated returns, will continue to draw investors to the sector.

Venture capital will continue to cede importance to corporate and non-institutional capital
As important as venture numbers are, they are no longer the single barometer of the state of worldwide cleantech investment. They don’t factor in most angel, project finance, private equity, sovereign and other sources of capital that are now making an impact in cleantech worldwide.

One of the most important sources to watch is corporate venture funding. Look for large companies to invest billions in cleantech in 2011. In recent weeks, Suez Environnement, affiliated with GDF Suez, created a venture capital fund called Blue Orange to invest primarily in waste management. GE invested $200 million+ in a handful of cleantech companies under the auspices of a competition. Corporations continue to form corporate venturing arms, driven not just by returns, but by associated corporate social responsibility (CSR) benefits.

Also anticipate an increase in corporate-led cleantech M&A activity in 2011, which reached record levels in 2010. Expect cash-laden firms to pick off even more leading technologies and concepts, as in recent transactions like Constellation buying CPower, and Sharp’s purchase of Recurrent Energy.

A return to early stage venture investments
We predict a return to early stage venture capital investing in cleantech in 2011. Already, in the last few months of 2010, data shows the pendulum has begun to swing back to early stage deals. In the third quarter of 2010, 46 percent of all cleantech deals worldwide were early stage deals, according to latest data.

Why? Investors are no longer piggybacking on U.S. government grants and loan guarantees, which had skewed investment into more mature cleantech companies. Government stimulus funds earmarked for cleantech by the U.S. and other countries globally are now largely allocated. In 2011, venture investment in cleantech will return to what it does best: seeking out emerging early stage technologies and teams that promise good multiples, and will be less influenced by governments putting large amounts of capital to work themselves. Funds are still being raised. And those funds will need to be invested.

Energy efficiency emerges as the clear rock star of cleantech
Yes, we have a broader definition of energy efficiency than others (see our cleantech taxonomy here). But efficiency—including smart grid, where we expect continued massive investment and corporate activity—really just got underway in 2010, so expect big things in 2011. To wit: GE’s huge announcements, investments and acquisitions in the third quarter of 2010. And just over a month ago, Russia unveiled a massive energy efficiency plan, given that the country apparently wastes as much energy in a year as the French economy consumes.

There were some calendar quarters in 2010 where more venture investment went into solar than efficiency, but in 2011, look for efficiency to become the clear dominant investment theme as investors continue to seek less capital intensive efficiency plays and eschew solar, where company valuations have been swinging wildly in 2010 from continued supply/demand and international subsidy havoc.

Anticipate a Darwinian winnowing of efficiency companies in 2011—partially because of concerns about differentiation, and partly because of the long sales cycles of utilities that are only starting to become appreciated to some startups. There will be failures in 2011 in certain advanced metering companies and other firms engaged in death-by-trials with utilities, and some winners among favorite brands like OPower, EnergyHub, Tendril, Silver Spring, eMeter, AlertMe, Energate. The deep-pocketed stand the best chance of surviving.

Biofuel investment could reach former highs
If economic growth continues in 2011, oil prices will rise, making renewables more cost competitive. And after several years of relatively inexpensive oil, we predict an upswing in biofuels investment in 2011, specifically, that will catch some unaware; investors still smarting from crop-based ethanol and biodiesel, cellulosic ethanol and algal oil disappointments may not see adrop-in biofuels revolution at hand.

The excitement will not be over cellulosic ethanol, which we saw disappear from headlines in 2010. Cellulosic ethanol may even disappear from investors’ portfolios altogether in 2011, if the U.S. EPA lowers its cellulosic ethanol mandates yet again. We believe the recent jump in the share price of Amyris (NASDAQ:AMRS) is representative of a larger awakening to the transportation, storage, energy balance and fungibility benefits of drop-in biofuels, i.e. chemically similar diesel, jet fuel, butanol, bio natural gas and others.

In biofuels in 2011, as elsewhere in cleantech, look for biology to trump chemistry. And for the likes of Amyris, Codexis (NADAQ:CDXS) and Gevo to make more commercial progress than cellulosic companies Range Fuels, Coskata and Mascoma.

Nuclear surprises, but not in U.S.
Expect to hear about more and more nuclear innovation in 2011, as the industry begins cautiously testing new science after decades of relative inactivity. However, don’t expect the U.S. to lead in either the science, the trials or the adoption: watch Asia, Europe and Canada as centers of innovation and where trials of new nuclear tech will be performed in 2011. Companies to watch include Thorenco (new reactor designs based on thorium fuel), Thorium One (thorium fuel for existing reactors, trials scheduled to start in existing reactors in 2011), Kurion (glass encasing of nuclear waste), General Fusion and others. Nuclear development will remain stalled in the U.S. in 2011 in regulatory and public opinion purgatory while the rest of the world passes it by.

Recycling and mining will attract more investment
Rising commodity prices have been quietly making the economics of recycling and recovery of trace materials more commercially viable. Silver almost tripled in price in 2010. Gold doubled. Companies that recover and reprocess materials, such as scrap metal, used lithium batteries or mining tailings, will be companies to watch in 2011. BacTech Mining (CVE:BM), Simbol Materials, Buss & Buss Spezialmetalle, DeMetai Technologies, MBA Polymers and GFL Waste & Recycling (which just got a$100m private equity infusion) are examples of companies that could benefit from commodity prices that will continue to rise in 2011. That’s barring a macro-economic downturn that, like everything else, whacks the price of commodities (gold bugs note: metals are not immune to market gyrations! Gold fell substantially in the 2008 global downturn).

Natural gas emerges to threaten solar and wind for utility renewable power generation
Renewable natural gas? Today it’s fossil-based. But what if chemically identical natural gas (not just messy syngas) could be made inexpensively from practically free feedstock? Such gas, if indistinguishable from petro-based natural gas, could be transported in existing pipelines and sold at a premium to industrial customers like power utilities anxious for a cheaper renewable source than solar and wind. And, if burned in existing IGCC / NGCC plants, such power could be baseload 24/7 renewable energy. Look for scientific innovation in natural gas in 2011, increased political support for it as a transitional “cleaner” fuel, a folding in of it into renewable energy standards and general cleantech industry buzz over it being an important new wagon to hitch to.

China becomes the most important market for cleantech: if you’re not selling in China, you won’t matter
Expect the leading cleantech IPOs of 2011 to continue to be on the Shenzhen and Hong Kong exchanges, as they were in 2010. Central government support of Chinese clean technology companies on Chinese exchanges will continue to give the country’s solar, wind and other vendors advantage in access to capital, growth and, therefore, ability to scale and conquer worldwide.

Kachan & Co. made a case this past August that China had assumed the worldwide leadership position as a cleantech market and supplier. This week, Ernst and Young asserted the same thing. So it’s time to underscore it again: if you’re not selling into China in 2011, you’re missing the biggest market for your clean technology product or service.

in 2011, the leadership of cleantech vendors and service providers will be determined by the extent of their traction in China. It’s the largest and the fastest growing market for clean technologies, and to ignore it out of concern for intellectual property or other costs of doing business will be to watch most of one’s addressable worldwide market disappear to competitors that willshoulder the costs of business in China.

We’d welcome rhetoric in 2011 being less about how countries could or should compete with China’s cleantech leadership, and more focus on how to simply get on with capitalizing on the commercial opportunity that Chinese growth represents. While there’s still a worldwide financial system to profit from.

[Reposted by permission from]

A former managing director of the Cleantech Group, Dallas Kachan is now managing partner of Kachan & Co., a cleantech research and advisory firm that does business worldwide from San Francisco, Toronto and Vancouver. Its staff have been covering, publishing about and helping propel clean technology since 2006. Kachan & Co. offers cleantech research reports, consulting and other services that help accelerate its clients’ success in clean technology. Details at

Nuclear Energy: Threat or Opportunity?

by Richard T. Stuebi

Several months ago, I was asked by the Chagrin Foundation for Arts & Culture, in my lovely home town of Chagrin Falls OH, to speak on the topic of nuclear energy at their Chautauqua-at-Chagrin lecture series this summer.

I agreed, and proposed the title of my talk “Nuclear Energy: Threat or Opportunity?” I thought that it would be kinda catchy, and that I could figure out something interesting to say under that heading.

Well, the talk is tomorrow (Tuesday July 20 at 6 pm ET), so this past weekend, I forced myself to organize my thoughts on what to say. It was more challenging than I had anticipated.

This is because the title of my talk actually turned out to be truly apt: nuclear energy is both a threat and opportunity. There are huge advantages and substantial risks associated with nuclear energy. It’s easy to see one side of the coin or the other, but it’s hard to see and accept both sides of the coin at the same time.

Among the points I intend to make in my lecture:

There is no easy, cheap, one-size-fits-all answer for powering our economy in a way that provides the standards of living we’re accustomed to, at the costs we’re accustomed to paying, in avoiding the bad future to which continued status quo will drive us. Nuclear energy can be a major part of the total solution, but only if we’re willing to accept the costs and risks.

Many people tend to think that nuclear powerplants are inherently dangerous, thinking of Chernobyl. Chernobyl was truly an aberration – all safety systems were intentionally disabled and the plant was pushed to limits as an experiment. (Hey, that’s a really good idea!) Three Mile Island was a more plausible worst-case scenario — and its environmental impact of was/is small relative to the long-term impact of coal mining or burning, or petroleum extraction or refining. The BP Gulf oil spill is far worse of an ecological catastrophe than Three Mile Island, but no-one’s talking about banning oil. Instead of environmental risks, the real risks of nuclear energy are about fuel security and fuel disposal.

The U.S. taxpayer has long heavily subsidized, and continues to subsidize, nuclear energy. With maybe a hundred billion dollars of cumulative R&D funding over the decades, plus substantial tax credits and loan guarantees, the U.S. government has been and remains the biggest benefactor of the nuclear industry. Private industry sure isn’t: there hasn’t been an order for a new nuclear reactor in over 30 years. When opponents discredit renewable energy due to subsidies (which they admittedly do receive), it’s pretty hypocritical: nuclear (and fossil) energy has gotten and still gets far more subsidy dollars than renewable energy has and does.

If we shut down all the nuclear powerplants in operation today, the risk associated with spent fuels would still exist, and emissions would likely go up – at least unless/until enormous amounts of new wind/solar installation were to backfill nuclear retirements. For the time being, the economics of new wind and solar energy (indeed, any new powerplants) are considerably higher than the costs of running existing nuclear plants, so electricity prices would go up if nuclear were to go away. So, shutting down operating nuclear plants doesn’t seem like a promising strategy from either an economic or environmental perspective.

The costs of new nuclear are completely unknown. There hasn’t been a new nuke completed in the U.S. since the 1980’s, and no new orders since the late 1970’s. New designs are on the drawing board, but none have been implemented. Including earning a fair return on investment in new plants, costs could be as low as 8 cents/kwh or as high as 15 cents/kwh. The range is so wide because it could take 5 years or 15 years to complete a new plant – based upon uncertainties about licensing, approval and permitting processes. The cost of new nuclear is generally more than new wind, and while less than new solar today, the costs of new solar should become competitive with technological advancements in the coming years. So, it would seem that this argues for massive wind and solar installation, rather than new nuclear (or new fossil powerplants).

But, it’s not so easy. Wind and solar are not “round-the-clock” – at least unless/until there’s cost-effective energy storage for the power grid (don’t hold your breath). And other options aren’t so appealing either.

New gas-fired powerplants have fairly low emissions and can be approved/built quickly, but price/supply of natural gas is uncertain and highly volatile. New coal powerplants would be an even riskier bet.

Using conventional technology and ignoring greenhouse gas emissions, the cost of energy from new coal powerplants is probably on the order of 6-8 cents/kwh. However, if the U.S. ever becomes serious about dealing with climate change via a carbon policy, then the economics of coal power will deteriorate significantly — either to capture carbon (largely untested and expensive technology) or to pay for the costs of emissions. In a carbon-constrained world, it’s easy to project the costs of new coal power at > 10 cents/kwh. So, if we don’t care about climate change, coal is likely to be the dominant answer, and few new nukes will be built in the U.S.

On the other hand, if climate change matters, then there’s a potential role for new nuclear in the U.S. This role is amplified if we want to deal seriously with the other energy imperative we face: eliminating our reliance on petroleum for transportation. Clearly, we won’t see nuclear powered vehicles. But, with improvements in battery technologies, we can (and likely will) see more electrification of transportation – through plug-in hybrids and even pure-electric vehicles. If/as that happens, we’ll need much more power generation capability — especially if a lot of old coal plants are retired in response to climate legislation. But, where will that new power come from? If we want it to be from zero-carbon sources, and if we’ve already installed as much wind/solar as we plausibly can (assuming no effective grid storage technology), nuclear will be a very interesting option.

Summarizing, the more we try to deal with climate change and oil dependence, the more appealing nuclear becomes. Environmentalists are torn: many oppose nuclear on philosophical grounds based on their perceived risks, while other thought-leaders (e.g., James Lovelock) are nuclear proponents based on the practical realities. Which risks are more pressing: climate change and energy insecurity, or radioactive wastes and weapons materials for terrorists? Those are the tradeoffs upon which tilts the balance for nuclear energy. Americans don’t seem to like that answer: they want no risk and low cost, and whine when they don’t/can’t get it.

On balance, I think the risks associated with climate and oil outweigh the nuclear waste and weapons risks. Accordingly, I tend to think that nuclear needs to be a bigger part of the energy toolkit of the future – at least until ocean-based power generation and/or grid-scale energy storage become economically viable. If nuclear is not to be part of the energy solution of the future, then there will be other costs/risks to bear — some of which could be very dramatic.

If we get it badly wrong, either way, the future of life on this planet may be seriously jeopardized.

Richard T. Stuebi is a founding principal of NorTech Energy Enterprise, the advanced energy initiative at NorTech, where he is on loan from The Cleveland Foundation as its Fellow of Energy and Environmental Advancement. He is also a Managing Director in charge of cleantech investment activities at Early Stage Partners, a Cleveland-based venture capital firm.

An Evening With Ernest Moniz

by Richard T. Stuebi

Last week, the MIT Club of Northeast Ohio hosted a talk at the Great Lakes Science Center in Cleveland by Professor Ernest Moniz, the Director of the MIT Energy Initiative, and a member of the President’s Council of Advisors on Science and Technology.

Over the course of about an hour of spirited commentary and responses to questions, Prof. Moniz made a number of interesting points. A few highlights:

  1. Arguably the key challenge facing the energy sector is the virtual monopoly that petroleum has on the transportation sector. Producing more non-petroleum options/alternatives for transportation will be pivotal to a better future. By virtue of its considerable domestic resource and lower carbon intensity, natural gas is an attractive option — either as a transportation fuel directly (e.g., CNG), or in generating electricity to support electrified vehicles.
  2. One must never lose sight that energy is a capital-intensive commodity industry subject to “complex politics”, which in turn means that the asset base changes very slowly, and (unlike other economic sectors such as consumer products) is driven first-and-foremost by considerations of cost. Technologies exist today to address most of our challenges, but “inconveniently” they are considerably more expensive, which is not attractive to either customers or politicians.
  3. Although more study at greater detail is always helpful, climate scientists have erred in framing public debates via increasingly sophisticated analysis. Over a century ago, predictions were made about carbon dioxide levels and planetary impact that are a good first-order approximation of what is being evidenced today. Rather than being required to prove that human-induced climate change is occurring, the burden of proof should be on others to show convincingly that human-induced climate change isn’t occurring — that second- and third-order effects (such as feedback loops and consideration of other variables) are somehow dominating the first-order linkages between carbon dioxide concentrations and average planetary temperatures.
  4. The exact future impacts of climate change are unknown, but the distribution of probable planet-wide average outcomes is fairly well described. An increase of 2 degrees Celsius by 2050 — what many consider to be the point beyond which planetary impacts become much more problematic — is on the lower-end of the range of possibilities even if global per capita carbon dioxide emissions are cut by 80% from today’s levels. If status quo is maintained, there’s virtually no statistical chance of containing temperature increases to 2 degrees Celsius by 2050.
  5. From a technological standpoint, advancements in all forms of low-carbon electricity generation — nuclear, renewables, and coal with carbon sequestration — will need to be pursued intensively. In addition, because some amount of future climate change is virtually predetermined given our past history, adaptation strategies and technologies should get much more attention. Although premature to employ, and scary because of the principle of unintended consequences, serious research should at least begin on planetary engineering approaches (e.g., deliberate emissions of sulfates) to offset the effects of an increased level of carbon dioxide concentrations in the atmosphere.
  6. The recent climate negotiations at Copenhagen never had much of a chance of producing a meaningful agreement without U.S. Congressional action. Hopefully, Congress will act to pass good legislation on climate change, because the prospect of EPA regulating carbon dioxide and other greenhouse gases as pollutants under the Clean Air Act is “horrific”.

In Prof. Moniz’s view, there is significant urgency for action, and a good chance of a not-very-good outcome. But, all we can do is the best we can do, so we have to move forward in a mood of determined optimism.

Richard T. Stuebi is a founding principal of the advanced energy initiative at NorTech, where he is on loan from The Cleveland Foundation as its Fellow of Energy and Environmental Advancement. He is also a Managing Director in charge of cleantech investment activities at Early Stage Partners, a Cleveland-based venture capital firm.

Sober Words from DOE

by Richard T. Stuebi

At the recent Western Energy Summit, Dr. Steven Koonin (Undersecretary of Science at the U.S. Department of Energy) made a speech with some eye-opening tid-bits. In this review on GreenTechMedia, Koonin is quoted as saying about the daunting challenges in moving away from fossil fuels:

“We have limited time and limited resources….We cannot let 1,000 flowers bloom indiscriminately.”

“The deployment of inefficient feel-good resources is doubly-bad” because they give the illusion of progress and divert scarce resources.

Coal “is not going to disappear anytime soon,” so much more effort needs to be put into carbon capture and storage technologies.

“If the world wants to seriously address emissions, nuclear will almost certainly have to be part of the future.”

Most interestingly, as reported by the August 3rd issue of the Peak Oil Review, Koonin is said to have opined in his speech that “resource constraints soon will force the Department of Energy to narrow its focus onto the most promising technologies.” If true, this is worrisome because (1) it possibly implies that the DOE isn’t necessarily expecting any major increases in R&D funding — and our national energy R&D budgets are considered by many to be pretty darn low in light of the challenges we face (see, for instance, this report by the Government Accounting Office), and (2) it suggests that DOE will increasingly start picking “winners and losers” — and the public sector is not known for being good at making such judgments.

If anyone can find Koonin’s speech text in full, I’d appreciate getting a copy.

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.

Yucca-ing Up Nuclear

by Richard T. Stuebi

My first day working professionally in the energy sector was September 29, 1986. (Why I remember this date so clearly, I can’t say.) On that day, I joined the consulting firm ICF in Washington DC, and as a bit of make-work (until I could get staffed on a significant project), I was asked to investigate when the national nuclear waste repository at Yucca Mountain in Nevada would be opened. I made a few calls over to the Department of Energy, and the general sense then was that Yucca Mountain would be open for business within 5 years.

Well, nearly 23 years later, we’re still waiting. On the DOE’s current Yucca Mountain webpage, no mention is made of an expected on-line date. A recent projection of Yucca Mountain’s completion date seems to be 2020. (Why it’s 11 years from today, and was only 5 years in the future 23 years ago, is a mystery to me.)

Of course, even 2020 is a dubious guess. Yucca Mountain’s tortured history and future is due to a lot of opposition from a variety of sources. Mainly, that’s been from ardent anti-nuclear voices. Probably the most important of these is Senate Majority Leader Harry Reid (D-NV), in whose state the facility would be located. Presumably, his stance reflects his voters’ NIMBY concerns. Reid now claims that the Yucca Mountain project is essentially terminated, due to some language insertions in President Obama’s budget.

However, opposition to Yucca Mountain also is increasingly emanating from some pro-nuclear parties. One of the more interesting takes on the daunting issues facing Yucca Mountain is available in a Q&A in the recent Technology Review with Allison MacFarlane.

For certain ideas, their time never comes. Such could well be the case for Yucca Mountain.

Until a better idea for nuclear waste disposal comes along — and more importantly, is adopted — the prospects for a robust rebirth of the nuclear energy industry in the U.S. will inevitably face an uphill battle.

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, he will also become Managing Director of Early Stage Partners.

Baby Nukes

by Richard T. Stuebi

Although not popular to many in the environmental community, one low/zero-carbon energy supply alternative that has to be at least put on the table for serious consideration is nuclear energy.

Yes, yes, we know the litany of concerns about nuclear energy: runaway fission leading to explosive catastrophes like the one that occurred in 1986 at Chernobyl, long-lived and extremely toxic waste products, and the use of fuels that make for scary weapons-grade materials for terrorists to exploit.

The U.S. nuclear industry hasn’t completed a new nuclear power generating unit in many years — though it’s generally not for the reasons listed above. Rather, the main damper on the U.S. nuclear industry has been high cost: to achieve economies of scale, the optimal nuclear unit size has long been thought to be greater than 1000 megawatts, which given the capital intensity of nuclear technologies (a November 2007 article in Nuclear Engineering suggests construction costs of at least $4000/kilowatt), implies minimum investments of several billion dollars. Given the massive market and regulatory uncertainties facing electric utilities, few have been willing to step up to the nuclear plate and lay down such a huge bet.

In recent weeks, I’ve seen not one but two articles — “Neighborhood Nukes” in Forbes and “Mini Nuclear Plants to Power 20,000 Homes” in The Guardian — covering the investigation of small-scale nuclear power generating units. Both articles prominently feature the New Mexico company Hyperion Power Generation, which claims to be developing a hot-tub sized unit of 25 megawatts capacity.

Spun out from Los Alamos National Laboratory, the Hyperion design is intended to overcome many of the obstacles associated to date with nuclear energy.

As The Guardian article summarizes, “the miniature reactors will be factory-sealed, contain no weapons-grade material, have no moving parts and will be nearly impossible to steal because they will be encased in concrete and buried underground.”

From Forbes: “Hyperion’s design uses uranium hydride instead of traditional uranium with control rods. The reactor gets rid of heat using thermal conductivity, which eliminates the big water-cooling systems and their containment bulwarks.”

Stunningly, Hyperion promises an installed cost of $1000/kw, and claims a sales backlog of $2.5 billion, with 100 firm orders.

So, maybe there’s a renaissance of nuclear energy in the offing. Steve Martin may have had it right, after all: “Let’s get small.”

But, before you get too excited, remember that the nuclear industry has been down this path before: in 1954, Lewis Strauss, then-Chairman of the U.S. Atomic Energy Commission, hinted that nuclear energy would in the not-too-distant-future make electricity “too cheap to meter.” We’re still waiting.

Richard T. Stuebi is the BP Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and is also the Founder and President of NextWave Energy, Inc. In 2009, he will also become a Managing Director at Early Stage Partners.

Into the Blue

by Richard T. Stuebi

Last week, the International Energy Agency released a study entitled Energy Technology Perspectives 2008, in which the agency estimated the shifts in the world’s energy system required to reduce CO2 emissions substantially.

In their so-called “BLUE” scenario (I haven’t figured out what “BLUE” refers to), a 50% CO2 reduction from 2005 levels by 2050 — what many scientists believe is about what needs to occur to stabilize the climate — is only achievable by tackling emission reductions that have a marginal cost of over $200/ton CO2. Ouch!

Even more provocatively, IEA estimates that the BLUE scenario would imply a widespread move to near-zero carbon buildings and the deployment a billion electric/hydrogen vehicles plus annual investments between 2010 and 2050 of 55 coal plants with carbon sequestration, 32 nuclear plants, 17,500 utility-scale wind turbines, and 215 million square meters of solar panels. By their accounts, this represents $45 trillion of investment above and beyond business as usual.

In IEA’s words, “BLUE is only possible if the whole world participates fully” in shifting to “a completely different energy system.”

Does anyone doubt the magnitude of the CleanTech challenge/opportunity in the coming decades?

Richard T. Stuebi is the BP Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and is also the Founder and President of NextWave Energy, Inc.

"A Special Report on the Future of Energy" by Mother Jones

by Richard T. Stuebi

I’ve never been a fan of the periodical Mother Jones – it’s always seemed a bit too “alternative” for me. That said, I was recently given a copy of the May/June 2008 issue – a special report on the future of energy – and was surprised by the quality and balance of the articles.

I particularly found “The Seven Myths of Energy Independence” by Paul Roberts (author of The End of Oil) to be a compelling read. To him, the seven myths are:

1. Energy Independence Is Good
2. Ethanol Will Set Us Free
3. Conservation Is a “Personal Virtue”
4. We Can Go It Alone
5. Some Geek in Silicon Valley Will Fix the Problem
6. Cut Demand and the Rest Will Follow
7. Once Bush Is Gone, Change Will Come

I think many advocates are well-advised to really reflect on #7. Bush is unquestionably the bête-noire of all things environmental, but he’s only a part of the problem – and arguably not even the biggest part. Congress and the entrenched interests completely stymie good energy/environmental policy. A new President will help, but won’t be a simple cure-all, for what ails us in the energy and environmental arenas.

Which brings me to another article in the issue: “Congress’ Top 10 Fossil Fools” by Chris Mooney, profiling the “foes and thwarters of renewable energy”. In his list, they are:

1. Senator Pete Dominici (R-NM)
2. The Southern Company (NYSE: SO)
3. Senator Mary Landrieu (D-LA)
4. Representative Joe Barton (R-TX)
5. Senator Jim Bunning (R-KY) and “Coal-State Dems”
6. Representative John Dingell (D-MI)
7. Senator Lamar Alexander (R-TN)
8. Senator Ted Kennedy (D-MA)
9. Senator John Thune (R-SD)
10. Senator John McCain (R-AZ)

Probably no surprise that there are more R’s than D’s on the list, but I was really surprised at the omission of Senator James Imhofe (R-OK), and by the inclusion of McCain. Apparently, the League of Conservation Voters gave the impending Republican Presidential nominee a rating of 0 (that’s right, zero) last year “because McCain missed every single environmentally relevant vote”, including ones in which he could have been the tie-breaker to overcome a filibuster on the 2007 clean-energy bill. Alas, what could have been…

Other good articles in the issue include:

“The Greenback Effect” by Bill McKibben on why markets aren’t necessarily antithetical to the environment, but can be the driving force for environmental solutions.
“Breaking the Gridlock” by Jennifer Kahn on how the smart-grid could be the major enabler for energy efficiency.
“The Nuclear Option” by Judith Lewis – a reasonably fair and balanced view of the pros and cons of nuclear energy, without the expected hyperbole.
“Tar Wars” by Josh Harkinson, which paints a not-at-all pretty picture of what’s happening to the landscape in Northern Alberta as the tar sands are mined to make oil.
“Put a Tyrant in Your Tank” by Joshua Kurlantzick, profiling the bad guys leading many of the major oil producing nations – who are financed every time you fill up at the pump.

Lots of interesting nuggets to be found in the sidebar boxes too. For instance, did you know that 30% of the electricity supply at the infamous Guantanamo Bay Naval Base is provided by wind turbines?

Well worth spending $5.95 at the newsstand, pick up the May/June 2008 Mother Jones.

Richard T. Stuebi is the BP Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and is also the Founder and President of NextWave Energy, Inc.

Powering the Planet

by Richard T. Stuebi

“Powering the Planet” is the title of an extraordinary speech that is regularly given by Nate Lewis, Professor of Chemistry at CalTech. It is a bit long and detailed, but very much worth reading, as it elegantly frames the scale of the worldwide energy/environmental challenges to be faced in the coming decades.

The gist of the presentation is that aggressive pursuit of energy efficiency is critical — but we still need to supply the remaining human energy requirement in some carbon-free fashion, which leaves us relatively few viable options:

  • Nuclear power, which concerns Lewis not for safety/security reasons but because of inability to expand nuclear utilization quickly/sufficiently to meet the world’s needs
  • Carbon sequestration of fossil fuel burning, which Lewis says may not be available in time or at the volumes necessary to have significant beneficial impact on climate change
  • Hydro, geothermal, wind and ocean energy, which are all fine in Lewis’ view, but inadequate in scope to supply global energy demands
  • Bio-based energy, which Lewis finds to be highly inefficient and therefore unlikely to be able to provide more than a small fraction of worldwide energy requirements

This leaves solar energy, which Lewis concludes is the best hope for the planet — technologically known to work, scalable with no binding supply limitations, at potentially reasonable economics with continued advancement. Then Lewis closes with the clincher: if we’re going to succeed with solar energy, our priorities need to change:

“In the United States, we spend $28 billion on health, but only about $28 million on basic solar research. Currently, we spend more money buying gas at the pump in one hour than we spend funding basic solar research in our country over an entire year. Yet, in that same hour, more energy from the sun is hitting the Earth than all of the energy consumed on our planet in that year. The same cannot be said of any other energy source.”

‘Nuf sed.

Richard T. Stuebi is the BP Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and is also the Founder and President of NextWave Energy, Inc.

Goin’ Nucular

by Richard T. Stuebi

It was pouring rain last Wednesday morning, as I entered an office building near Cleveland Hopkins Airport to attend a meeting convened by Senator George Voinovich (R-OH) to discuss the future of nuclear energy.

Unlike many of his peers, Senator Voinovich appears to take the issue of climate change seriously. Also unlike many of his peers, he sees an increasing reliance on nuclear energy as essential in meeting the energy and environmental challenges of the future.

The keynote speakers of this 90-minute meeting were Dennis Spurgeon (Assistant Secretary for Nuclear Energy, DOE), Dr. Peter Lyons (Commissioner, NRC) and Adrian Heymer (Sr. Director of New Plant Development, Nuclear Energy Institute). In attendance were representatives of Ohio-based utilities with nuclear fleets AEP (NYSE: AEP) and FirstEnergy (NYSE: FE), as well as major suppliers to the nuclear industry such as locally-based Babcock & Wilcox.

The basic message from the speakers was simple: a lot of nuclear plants must be built in the coming decades, and the U.S. urgently needs to take steps to get out of the way to enable the development of these new plants. The speakers outlined the activities required to revive the industry to bring about this nuclear “renaissance”: Federal loan guarantees (at 100% of debt requirements, not 90%) for new nuclear plants, opening of Yucca Mountain as a nuclear waste storage facility, increased training and workforce development to replace retiring nuclear engineers, the Global Nuclear Energy Partnership (GNEP), etc.

And, the speakers couldn’t reiterate enough how safety was the paramount concern. This is truly an amazing technology if everyone has to emphasize how steps will be taken to ensure disasters don’t occur. (I am reminded to recall tour of the Clinton nuclear plant in Illinois in the early 1990’s, at which point about 200 of the 1100 site employees — almost 20% of staffing! — were dedicated to security, preventing people from doing the wrong things. I can’t think of another technology that requires so many band-aids to mitigate perverse effects. Hard to imagine any private investor wanting a piece of that cost structure.)

In the open discussion that followed the speakers’ remarks, I had the temerity to question the wisdom of furthering our bet on the uranium-fission cycle as the basic technological platform for nuclear power production in the future.

While I admitted that the current nuclear fleet was an important contributor to the energy mix that we can’t afford to prematurely retire, and I conceded that some new nuclear plants of more-or-less conventional technologies may be necessary as a stop-gap measure for a few years, I also submitted that other fission cycles — certainly including thorium, maybe others as well — ought to be explored much more thoroughly, so as to create the possibility of a new and much better generation of nuclear plants offering more than just incremental improvements.

This is because, in my view, uranium fission suffers from three unavoidable pitfalls:

1. Uranium supplies are hardly infinite themselves, and have a significant concentration in places like Russia that we ought to prefer NOT to rely upon for precious commodities.

2. Uranium fission creates sizable quantities of transuranic wastes of extreme toxicity and half-lives measured in the thousands of years.

3. Uranium fission makes for excellent bombs — not only nuclear explosions, but also dirty residues — that would be highly prized by terrorists and other ne’er-do-wells.

I’ve been told by credible sources that fission from thorium essentially obviates each of these fundamental challenges. Relative to uranium, there are orders of magnitude more thorium in the earth’s crust, and it is widely distributed. Thorium fission produces wastes with much lower toxicity and much shorter half-lives (a few hundred years), in much lower quantities to boot. And, thorium doesn’t have a positive gradient that facilitates run-away fission that leads to explosions. These all sound like attractive attributes to me, worthy of a lot more exploration.

Alas, the nuclear experts at the meeting pooh-poohed thorium and defended uranium. They said that never had any uranium been used by bad guys to make a bomb. (You mean, Yet?) They said that the GNEP would create an effective international pact to prevent nuclear materials from getting into the hands of enemies. (Oh, really?) They said that there was plenty of uranium for the next generation of nuclear plants. (And then what?) They said that the GNEP would dramatically reduce the amount of long-lived nuclear wastes from future uranium fission facilities. (For tens of billions of dollars — what a bargain!)

Ultimately, I was not reassured by the views of the uranium fission advocates. To paraphrase Shakespeare, they doth defend too much. And, note that the nuclear industry is the not-so-pretty offspring of the military-industrial-Oedipal complex of the 1950’s.

It is hard to think of a less-credible set of proponents than those who carry the combined DNA of the defense and electric utility sectors, niether of which is particularly famous for a commitment to the truth in the light of established facts. Their mantra has often been: “Trust us.” I’m typically not paranoid, but in this case, I am very skeptical indeed.

Richard T. Stuebi is the BP Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and is also the Founder and President of NextWave Energy, Inc.