India and China’s growing economies are adding to the current global oil dependency as world oil demand is estimated to reach 90 million barrels per day (bpd) before the end of this decade. With current prices fluctuating in the $60’s and experts such as T Boon Pickens saying we could see $100 barrel, there is a global push and demand to seek alternative energy solutions.

India and China could see the high growth they are experiencing come to a significant slow down if oil prices are too high and no solutions are in place.Technology to reduce the dependency on oil and gas needs to be implemented to find short-term and long-term solutions.

India is taking heed and now ranks fourth in the world for wind energy behind Germany, Spain and the United States. The country’s monsoon winds, contribute to their current annual power production . The World Wind Energy Association (WWEA) sees India as a leader in Asian countries in the area of generating wind power. India, with overall capacity (4,430 MW) and additions (1,430 MW) is taking steps to deal with a pending energy crisis.

The world is listening as wind energy currently delivers worldwide 1 per cent of the global electricity generation.

China moved up from 10th position in 2004 (764 MW) to 8th in 2005 (1,260 MW), and with installations, has reached the sixth position worldwide. The Chinese Government adopted a renewable energy law in 2005 with the goal of strengthening its manufacturing industry so it can produce an increased number of turbines to meet its future demands.

Global energy players are being asked to make progress in addressing a global-energy policy approach to secure energy efficiency and environmental protection.

This past week, I attended probably the largest annual pan-renewables event in the U.S.: PowerGen Renewables, held each spring in Las Vegas. This event is produced by Pennwell (which puts on the immense annual PowerGen show for the conventional power generation industry), and is organized by the American Council on Renewable Energy (ACORE).

The keynote session packed a huge hall, with a claimed attendance of 2500. The first presenter was the new leader of DOE’s Energy Efficiency and Renewable Energy (EERE) shop: Alexander Karsner. (March 23 press release) It’s notable that Karsner is actually a renewable industry guy himself, having led Enercorp, a project developer that includes some wind in its portfolio history. Karsner’s speech was probably pretty compelling on paper, but (in my view) he tried too hard to express his passion and instead came off a more than a little overly-strident, even militaristic. Oh well, perhaps with time he’ll polish off his “hot” edges; he’ll certainly have plenty of opportunities to do so in future speeches.

The keynote session also included ex-CIA Director Jim Woolsey, who made an outstanding case for biofuels as a means to dramatically reduce our dangerous reliance on the Middle East for transportation fuels, as well as reduce emissions. If you get the chance to hear him speak on this topic, make your schedule work for it.

But, GE’s “Ecomagination” talk was strangely flat, and after the keynote session, the event lost steam. There were probably only a couple hundred attendees by Day Two, and the exhibition floor distinctly lacked a buzz for the whole show.

Perhaps this is due to the fact that the hall was much bigger than it needed to be, but the lack of crowds trolling the booths suggests that there may not be much of a market for a trade show that spans the various forms of renewable energy.

The wind industry was not very well represented. Among the bigger players, GE was the only manufacturer and enXco the only developer to exhibit. Probably this is because the U.S. wind market is “large enough” for industry players to see the upcoming AWEA Windpower Conference in Pittsburgh in June as the only venue that matters.

In the solar industry, much the same story applied: only Kyocera among the major photovoltaics manufacturers had a booth. Presumably, the solar companies view Solar Power 2006 in San Jose this October as the place to be.

On the other hand, the biofuels crowd was far more prevalent than at previous PowerGen Renewable shows. With $60+/barrel oil, and the lack of an established leader in the biofuels trade show arena, I guess that’s not surprising.

ACORE talks about its identity as a “big tent” for all renewable interests to rally under. This probably makes sense for policy issues in Washington, which is where ACORE was founded and remains based. But, with this 3rd annual show now in the books, the verdict remains unclear (at best) for a trade show among corporations in different segments of renewables. It would appear that companies with interests in wind want to do business with each other, not so much with solar parties, and vice versa.

Wednesday, April 12, 2006

I might have heard James Woolsey* deliver his opening speech on clean energy at the 58th Conference World Affairs in Boulder, except that it’s been a very busy week. There were presentations for Colorado Interfaith Power & Light in Denver. A wave energy start-up wanted input on its marketing message and a new urbanism real estate developer wanted some guidance on solar photovoltaics. The Green House Network needed someone to administer registration for a conference on climate change and coal-fired plants…so I signed on. Because I couldn’t put it down, I finished reading “Electric Universe” by David Bodanis.

And my dad came out from New York for a brief visit. He’s a corporate attorney – Chinese and Saudi clients…you get the drift – with an ivy undergrad engineering degree. Growing up, time alone together was scarce (divorce, etc); I recall being truly alone him only once, in his garden, talking about tomatoes. (We’re both nuts about gardening.) I don’t have a garden these days, but I do have the ‘brae bio-bus’ project. Absent easy chit-chat about purple heirlooms and pests, I hit him up for advice on the electrical configuration for the bio-bus. I showed him my two maintenance-free 6volt 220ah Lifeline batteries, the solar trickle charger on the starter batteries, and my favorite new toy, a Xantrex 400watt modified sine wave inverter, battery, AC/DC box with charge control panel, AM/FM radio and AC wall wart charger. I pulled out pictures of a 2000watt pure sine wave inverter/charger, a 300amp T fuse block, a distribution box, and solar panels – and the schematic I’d drawn. He thumbed through “The RVers’ Guide to Solar Battery Charging: 12volt DC-120volt AC Inverters” and a Real Goods catalog. Taking shelter from a rare drizzle in Denver, could my dad figure out how AC shore power connects to the inverter/charger? Yes, indeed.

Accelerating Advanced Hybrid Technology into the Marketplace

In the midst of this fascination with the electric universe, I spoke with David West, founding member of the Plug-in Hybrid Development Consortium and Vice President of Marketing for Raser Technologies – an R&D company that develops and licenses advanced electric motor and controller technology. Raser is a member of the Consortium, along with: A123Systems, International Battery, Delta-Q Technologies, Daiken, ENAX, Electrovaya, Maxwell Technologies, and two utilities, Pacific Gas & Electric and Southern California Edison.

All Consortium members have a financial interest in market adoption of the plug-in hybrid electric vehicle (or PHEV) – from the manufacturers of components like batteries to the electric utilities. Yet, I’ve heard enough people interested in clean energy declare defensively, “I’m not a tree hugger,” that David’s comments were refreshing. Plug-in hybrids aren’t just about making money; no, they are also about making a better planet. These hybrids are part of a viable vision – one in which the power of batteries, not the force of bullets, meets our growing demand for energy.

The PHEV is not a brand new car, but a line extension of existing models (“I’ll take that spiffy number over there in midnight blue, the PHEV with a roof rack, thank you!”) The fuel efficiency and low emissions of PHEVs put to shame not only standard combustion engines, but also other non-plug-in hybrids (and pseudo-hybrids…see below). We’re talking 100+ MPG.

DaimlerChrysler is the first (and only) manufacturer building plug-in hybrids but is focused on passenger vehicles and sedans, like a 15-passenger van prototype called the Dodge Sprinter. This PHEV, based on Mercedes-Benz commercial vehicle technology, can get up to 20 miles on electric power. (Not quite the rig for me, bio-bus and all.) So, how does the average car-buying consumer get from “I want to buy a PHEV, darn it!” to cruising down the road in a fully-warrantied, mass-produced plug-in hybrid electric vehicle from a major auto maker?

I posed the question to Felix Kramer of CalCars which advises and supports the Consortium. “That’s the Holy Grail,” Felix replied, “That’s what we’re trying to make happen. And we don’t have an auto maker stepping up to do it. Once the auto maker does, it will be one to two years.” CalCars is a non-profit startup formed by entrepreneurs, engineers, environmentalists and consumers that tackles national security, jobs and global warming – at the same time. It is presenting PHEVs, along with wind and solar power, as the coordinated response to two of today’s greatest challenges: global warming and energy security.

Market Viability

The tipping point – when climate change/global warming is part of the national consciousness and influences purchasing decisions – is upon us. But energy security? My dad left me a copy Kevin Phillips’ “American Theocracy.” Part I of the book is titled ‘Oil and American Supremacy,’ and it describes our long history of exchanging bullets for energy, right up through the current invasion of Iraq. To quote Congressman Ron Paul of Texas (“Iran: The Next Neocon Target”) who spoke last week on the House floor about the high price tag of bullets for oil, “Where’s the outrage?”

Not waiting for the ‘energy security tipping point’ – or the outrage – Plug-in Partners, a national grass-roots initiative out of Austin, Texas, is taking soft orders to demonstrate market interest in PHEV to auto makers – to demonstrate the viability of PHEVs to the big guys (who have gotten so big they can’t see their own toes.) The major auto makers are, apparently, incapable of kicking themselves into gear, but they do have that marketing/PR thing down pat…if it’s got a battery and some electricity, but it still gets lousy fuel efficiency, call it a hybrid! That’s the ticket!

It’s so sad. The gears of “free market capitalism” vis-à-vis transportation – a market that responds to market signals – are utterly gummed up. Jump-starting the PHEV car market will require the likes of CalCars, the Plug-In Hybrid Development Consortium, Plug-in Partners, Woolsey and a flotilla of like-minded people…and one, just one, major auto maker.

In a year or two, I’d like to be towing a (little) PHEV behind my bio-bus and, in true American fashion (if I can’t live and work and eat all within walking distance, or avail myself of public transportation), I hope to be salivating over the next iteration of clean, efficient cars like the Extreme Hybrid™ – a car that gets hundreds of miles to the gallon. And, of course, I’ll be hoping my PHEV makes my Porsche-driving brother really jealous – for all the right reasons.

*“Woolsey, CIA director for President Clinton from 1993 to 1995, a Booz Allen Hamilton vice president and a member of the American Commission on Energy Policy, said a combination of non-grain ‘cellulosic’ ethanol, ethanol-burning cars and plug-in hybrid vehicles are among the best ways to wean the country from fossil fuels. Woolsey drives a Toyota Prius with a bumper sticker that reads ‘Osama bin Laden hates my car’ and has solar cells on his roof. Woolsey has a clear distaste for America’s financing both sides of what he calls ‘the long war’ with Islamic radicals in the Middle East…Where does that money come from? ‘When you pull into a filling station, turn the rear-view mirror just a little bit so you can look at yourself,’ Woolsey told the full house at Mackey Auditorium. There are plenty of others to blame, starting with auto makers churning out Hummers to government policy that gives tax breaks to people who buy them, Woolsey said.” The Boulder Daily Camera, Tuesday, April 11, 2006.

In Europe, wind energy is moving offshore. It’s simple, really: Europe is densely-populated, land is scarce and hence valuable, and so anyone wanting to develop new wind projects is looking at putting turbines in the Baltic Sea. A side benefit is that the wind resource is more plentiful offshore, not subject to disturbance from hills and trees.

In the U.S., prospects for offshore wind are not as rosy. With the continued NIMO (Not In My Ocean) efforts by local residents to scuttle the proposed Cape Wind windfarm off Nantucket, it’s hard to see much development coming to fruition there, or along the similarly aesthetically-picky Pacific Coast. As for the South Atlantic and Gulf Coasts, they are so vulnerable to hurricanes that would-be project developers are likely to be scared off.

FPL is developing a 140 megawatt windfarm off Long Island, and this one has a chance of actually being built. But this is because Long Island faces very high energy prices and future shortages that are almost unparalleled in the U.S. Electricity prices approach 20 cents/kwh, based almost solely on natural gas and oil burning powerplants located on the island, and there is limited additional power import capability from the mainland. (Of course, it helps that the project is being developed off the coast of Jones Beach, rather than the Hamptons.)

In the Midwest, there may be a brighter long-term future for offshore wind. There is likely to be ample good wind resource in the Great Lakes; Lake Erie looks especially promising, and has the added advantage of being rather shallow. Perhaps in a few decades, there could be gigawatts of wind generating capacity in the Great Lakes.

But, the problem remains economics. Excluding the PTC, onshore wind projects produce power at roughly 5-8 cents/kwh, whereas in contrast offshore wind costs reportedly are about double that level – even factoring in better wind and correspondingly higher capacity factors that are available offshore.

Offshore wind technology can improve. Most wind turbines available for offshore application are enlarged “marinized” versions of onshore designs. A clean-sheet approach to offshore wind designs offers the prospect of cutting costs by perhaps 50%, though such improvements are likely to take several years to achieve. Some observers (such as The Economist, recently) suggest that vertical axis designs, rather than the dominant horizontal axis “propeller” approach, may lead to better economics for offshore application.

But that’s all in the future. With so much vacant and windy land in the Plains and West, windfarm developers in the U.S. can well afford to ignore offshore for now and focus on onshore project opportunities for the foreseeable horizon.