I'd say so.
Look at the Volt, around which GM is centering it's future. Look at the dozens of vehicles coming in the next 3 years, like the Nissan Leaf http://energyfaq.blogspot.com/2009/08/how-good-is-new-ev-leaf.html . Look at the explosion of development around them:
"...here is where the dots connect and the news turns good. For the technical challenge of greening electric cars means entering a commercial landscape that mirrors the transformative industries of the 1980s and '90s: computers and software, switching and networking, consumer electronics converging with cellular technology. This landscape is full of start-ups and medium-size supplier businesses that play to American strengths: entrepreneurship, originality, comfort with the virtual. We ought to stop thinking about the auto industry as a handful of great manufacturing companies superintending large, dependent suppliers -- or, for that matter, cars as standalone objects. Rather, the electric car will be a kind of ultimate mobile device, produced in expanding networks for expanding networks; a piece of hardware manufactured by a burgeoning supplier grid and nested in an information grid interlacing the electrical grid. Building out these three networks will be more profitable, and a greater engine of economic growth, than building the cars themselves."
See: http://www.inc.com/magazine/20091101/the-connected-car.html
November 11, 2009
October 27, 2009
Is energy innovation slowing down?
I'd say no, judging from some new grants awarded by the Dept of Energy.
The DOE created a new section which is intended to do for energy what the DOD's DARPA did for many things, including the internet. These awards were the best of a much, much larger number of submissions. This is the first round of projects funded under ARPA-E, which is receiving $400 million under the American Recovery and Reinvestment Act.
If even a few are successful, the effect would be dramatic.
Take a look: http://www.energy.gov/news2009/documents2009/ARPA-E_Project_Selections.pdf
The DOE created a new section which is intended to do for energy what the DOD's DARPA did for many things, including the internet. These awards were the best of a much, much larger number of submissions. This is the first round of projects funded under ARPA-E, which is receiving $400 million under the American Recovery and Reinvestment Act.
If even a few are successful, the effect would be dramatic.
Take a look: http://www.energy.gov/news2009/documents2009/ARPA-E_Project_Selections.pdf
October 26, 2009
Which is better for energy - regulation or free markets?
I'd prefer free markets. For instance, if you want to reduce carbon emissions quickly and simply, use a simple carbon tax. Or, if you like things that are slower and more complex (and therefore easier to sell politically), go to cap and trade.
Why do I prefer free markets? Because they're easier. If you're going to run things by central planning instead of by free markets, then the central managers have to manage them. They have to stay on top of things, and adjust as they go, or things will fall apart.
Two examples.
First, the automobile Corporate Average Fuel Efficiency regulation. It originally contained a light truck loophole, which made sense because light trucks were working vehicles. Gradually, car makers moved to SUV's, because the lower MPG level allowed greater engine power. Detroit stymied an update to the regulations, as Detroit needed SUV's to compete with Asian manufacturers. That meant the growth of absurdly over-powered military vehicles, wasting gasoline and making the roads less safe overall (the occupants of SUVs are safer, but only because greater size means that when they hit a smaller vehicle, that smaller vehicle absorbs most of the kinetic energy, and therefore is much less safe).
Second, China mandated that utilities build wind power, but not that they use it, so they don't spend the extra money for transmission!
Also, China mandated "Buy Chinese", and the domestic manufacturers can't build turbines that can keep running!
Source http://www.forbes.com/2009/07/20/china-wind-power-business-energy-china.html
Just goes to show - you've got to keep on top of regulations...
Why do I prefer free markets? Because they're easier. If you're going to run things by central planning instead of by free markets, then the central managers have to manage them. They have to stay on top of things, and adjust as they go, or things will fall apart.
Two examples.
First, the automobile Corporate Average Fuel Efficiency regulation. It originally contained a light truck loophole, which made sense because light trucks were working vehicles. Gradually, car makers moved to SUV's, because the lower MPG level allowed greater engine power. Detroit stymied an update to the regulations, as Detroit needed SUV's to compete with Asian manufacturers. That meant the growth of absurdly over-powered military vehicles, wasting gasoline and making the roads less safe overall (the occupants of SUVs are safer, but only because greater size means that when they hit a smaller vehicle, that smaller vehicle absorbs most of the kinetic energy, and therefore is much less safe).
Second, China mandated that utilities build wind power, but not that they use it, so they don't spend the extra money for transmission!
Also, China mandated "Buy Chinese", and the domestic manufacturers can't build turbines that can keep running!
Source http://www.forbes.com/2009/07/20/china-wind-power-business-energy-china.html
Just goes to show - you've got to keep on top of regulations...
October 25, 2009
Volt battery costs, part 6
How likely are large reductions in lithium-ion battery costs?
Highly likely, according to their manufacturers.
"During a panel discussion at a plug-in vehicle conference in Detroit, several speakers said dramatic cost cuts are possible once the advanced batteries reach high-volume production...
Johnson Controls-Saft Advanced Battery Systems aims to reduce the cost of a lithium-ion battery pack by 50 per cent, said Michael Andrew, the venture's director of government affairs and external communications for hybrid electric battery systems....
Ric Fulop, vice-president of business development for A123 Systems Inc, said he believes the cost of battery packs could come down 9 per cent per year as the industry matures....
Ramanathan...said initial costs may be too high because car manufacturers are over-engineering cars and battery packs to ensure there are no mechanical glitches that could sour consumers on the technology."
http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10605008&pnum=0
Highly likely, according to their manufacturers.
"During a panel discussion at a plug-in vehicle conference in Detroit, several speakers said dramatic cost cuts are possible once the advanced batteries reach high-volume production...
Johnson Controls-Saft Advanced Battery Systems aims to reduce the cost of a lithium-ion battery pack by 50 per cent, said Michael Andrew, the venture's director of government affairs and external communications for hybrid electric battery systems....
Ric Fulop, vice-president of business development for A123 Systems Inc, said he believes the cost of battery packs could come down 9 per cent per year as the industry matures....
Ramanathan...said initial costs may be too high because car manufacturers are over-engineering cars and battery packs to ensure there are no mechanical glitches that could sour consumers on the technology."
http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10605008&pnum=0
October 24, 2009
Will Chinese fossil fuel consumption grow? Part 3
As I've noted before - many are concerned that growing fossil fuel consumption in China will necessarily dramatically increase world CO2 emissions, while competing for oil with western importers, and setting the stage for economic volatility when it's coal runs out.
So, what's China doing?
"China has also begun to see energy efficiency and renewable energy as ingredients for the type of modern economy it wants to build, in part because it would make the nation's energy sources more secure.
"We think this is a new business for us, not a burden," said Gan Zhongxue, who left a job as a top U.S. scientist for the giant ABB Group to head up research and development at ENN, the Langfang company that made its fortune as the dominant natural gas distributor in 80 Chinese cities. "
---------------
"China has taken significant steps in the past five years. It removed subsidies for motor fuel, which now costs more than it does in the United States; its fuel-efficiency standard for new urban vehicles is 36.7 miles per gallon, a level the United States will not reach for seven years. It has set high efficiency standards for new coal plants; the United States has none. It has set new energy-efficiency standards for buildings. It has targeted its 1,000 top emitters of greenhouse gases to boost energy efficiency by 20 percent. And it has shut down many older, inefficient industrial boilers and power plants. "
source
So, what's China doing?
"China has also begun to see energy efficiency and renewable energy as ingredients for the type of modern economy it wants to build, in part because it would make the nation's energy sources more secure.
"We think this is a new business for us, not a burden," said Gan Zhongxue, who left a job as a top U.S. scientist for the giant ABB Group to head up research and development at ENN, the Langfang company that made its fortune as the dominant natural gas distributor in 80 Chinese cities. "
---------------
"China has taken significant steps in the past five years. It removed subsidies for motor fuel, which now costs more than it does in the United States; its fuel-efficiency standard for new urban vehicles is 36.7 miles per gallon, a level the United States will not reach for seven years. It has set high efficiency standards for new coal plants; the United States has none. It has set new energy-efficiency standards for buildings. It has targeted its 1,000 top emitters of greenhouse gases to boost energy efficiency by 20 percent. And it has shut down many older, inefficient industrial boilers and power plants. "
source
October 23, 2009
Will Chinese oil demand grow? Part 2
The concern is often heard that growing oil consumption in China will necessarily cause demand for oil to skyrocket, regardless of supply or pricing, such that other countries will be forced to settle for a smaller share of the oil production pie. So, what does the Chinese history of oil consumption tell us?
Average oil consumption in China in 2007 was 7.29 million b/d. In 2008, when oil prices peaked, Chinese consumption fell to 6.92 b/d. When prices fell again in 2009, consumption rose to 7.84 b/d. Source: http://www.peakoil.nl/wp-content/uploads/2009/10/2009_October_Oilwatch_Monthly.pdf
So, we see that Chinese oil demand does indeed respond to supply and demand.
Average oil consumption in China in 2007 was 7.29 million b/d. In 2008, when oil prices peaked, Chinese consumption fell to 6.92 b/d. When prices fell again in 2009, consumption rose to 7.84 b/d. Source: http://www.peakoil.nl/wp-content/uploads/2009/10/2009_October_Oilwatch_Monthly.pdf
So, we see that Chinese oil demand does indeed respond to supply and demand.
October 20, 2009
Will Chinese oil demand grow?
The concern is often heard that growing vehicle sales in China will necessarily cause demand for oil to skyrocket. So, will Chinese oil demand grow?
No, not necessarily. According to the well -respected Industrial Engineering consulting firm McKinsey & Co.:
"China is quietly laying the foundation to become a global contender in the development of hybrid and electric vehicles....The Chinese government has been actively promoting the development of the electric vehicle industry..."
They estimate that EV market penetration will be roughly 3-4 as great in China, compared to the world market.*
http://www.mckinsey.com/clientservice/ccsi/pdf/the_electric_vehicle_opportunity.pdf
*Their estimate of EV market penetration in 2030 are very conservative: 5-10% for the world, and 20-30% for China. They do not attempt to evaluate whether Chinese oil consumption can grow to the level found in simple growth projections, which they indicate is 17M bbl/day in 2030. I think we can expect EV market penetration to be much larger, based on growing shortfalls in oil production.
No, not necessarily. According to the well -respected Industrial Engineering consulting firm McKinsey & Co.:
"China is quietly laying the foundation to become a global contender in the development of hybrid and electric vehicles....The Chinese government has been actively promoting the development of the electric vehicle industry..."
They estimate that EV market penetration will be roughly 3-4 as great in China, compared to the world market.*
http://www.mckinsey.com/clientservice/ccsi/pdf/the_electric_vehicle_opportunity.pdf
*Their estimate of EV market penetration in 2030 are very conservative: 5-10% for the world, and 20-30% for China. They do not attempt to evaluate whether Chinese oil consumption can grow to the level found in simple growth projections, which they indicate is 17M bbl/day in 2030. I think we can expect EV market penetration to be much larger, based on growing shortfalls in oil production.
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