At the annual Clean-Tech Investor Summit in Indian Wells this week, finance, science and imagination mingled, with the aim of fostering industries that preserve the planet. The gathering was produced by Ron Pernick of Clean Edge consultants and Craig Simak of the International Business Forum, and chaired by venture investor Ira Ehrenpreis of Technology Partners.
Times staff writer Edward Silver filed this report on some of the ideas offered by conference speakers, each an innovator in sustainability:
A long road
During a discussion of the roadmap for electric vehicles, Britta Gross, manager of hydrogen and electric infrastructure for General Motors, spoke of the challenge to succeed with the upcoming Volt car along with the rest of the company’s EV agenda.
Producing a quality electric car, she said, isn’t enough to win hearts and minds. To begin with, you need effective charging systems and smart public policy. Suddenly you’re also up against cheaper gasoline.
I got the sense that Gross feels she’s in a bind, and not just because of GM’s financial straits. If there’s no mechanism but the marketplace at work, the entrenched advantages of the petro-driven status quo -- cost, familiarity, convenience -- will be difficult to overcome.
Jason Wolf of Better Place offered his view of the solution, or at least a piece of it. His Palo Alto company proposes to own the EV battery, taking a big chunk out of the price of the car. That becomes a subscription fee instead. The motorist pays to use the battery, rejuicing it at perhaps one-day-ubiquitous Better Place charging stations. During a trip longer than 100 miles, you swap it out for a fresh one. Said Wolf: "We enable mass adoption." . . . .
Investing in natural selection
Janine Benyus, an eloquent proponent of "biomimicry," was billed as the inspirational speaker of the day, and she delivered. Benyus came to tell the venture investors that plants and creatures that live well on very little are inspiring product design. Think about it, she said -- life on Earth, guided by natural selection, put in 3.8 billion years of R&D before humans even started tinkering.
Her presentation brought to light emerging companies that study the quiet, efficient, low-impact processes of nature and adapt them for industry and sustainability. Among them is Aquaporin of Denmark, whose pure-water technology was modeled on the workings of kidneys and blood cells. Another, Canada’s Regen Energy, based its approach on the teamwork observed in bee colonies: With its software and devices, energy-hogging machines within a building can coordinate, and cut, their consumption -- a smart grid on a small scale.
Benyus has more credits than can be counted in a blog, but if you’re interested, visit the websites of her consulting firm, the Biomimicry Guild, and the nonprofit Biomimicry Institute. She and Paul Hawken, the entrepreneur and noted author of "Natural Capitalism," recently launched the Biomimicry Venture Group, presumably to fund these ideas.
Liquidity crisis
Water and fossil fuels have more in common than we’d like to think. Peter Gleick, president of the Pacific Institute in Oakland, noted that they permeate the ways we make things and consume things. But growing long-term demand and competition for both threaten us with scarcity and environmental harm.
America’s massive Ogallala acquifer is one among many sources feeling the pressure. Overpumping, Gleick warned, will raise the cost of tapping groundwater, and some sites around the globe could run dry. We see something like that in the diminishing returns from mature oil fields like Mexico’s Cantarell. Climate change jeopardizes water supplies, too. But few resource planners have worked that into their models for the future.
Gleick also pointed to vital differences between these resources: Oil is much more valuable in dollars and cents. Yet we have substitutes for oil, however imperfect, and if push comes to shove, we could live without it. For water, there are none, and we can’t.
Gleick told his audience that China has banned new operations in water-intensive industries around parched Beijing. If the wet stuff becomes dear, businesses like semiconductors and agriculture will feel it, while conservation technology and desalination could catch the wave.
Top photo: Chevy Volt. Credit: Andrew Harrer/Bloomberg News
Bottom photo: The California Aqueduct. Credit: Luis Sinco/Los Angeles Times
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One wonders why anyone who would claim that EV technology is at the control of the marketplace (i.e. he means that consumers will decide what they need, rather than Big Brother) is alowed to publish fiction such as this.
Oabama has promised $7500 per vehicle tax credit for Ev or REVs like the Volt. That don't sound nothing like no marketplace environment to me. I also note that brainless Obama's dream of 1 milion cars electrically powered cars on the road within the next 5 years will accomplish exactly nothing in terms of either carbon emissions or gasoline consumption. Let's see now. There are 365 million gas powered cars out there, using approximately 40% of the crude oil. That works out to an invisible reduction of 1/5th of 1 percent of oil demand. Oh, yeah, Obama reallly knows his math. Another symbolic idea from the newsset fool in the WH - file it alongside that guff about appointing honest, competent Feds or closing Guantanomo. Obama has sold out before he's even changed the drapes in the White House. Different colored skin, same old brainless jerk. The internet made Obama and the internet will drstroy the liar.
Posted by: ArthurGlen | January 24, 2009 at 10:51 AM
Talk about 'brainless jerks', its almost comical when a real doozy posts on this otherwise enlightening blog. Even but a cursory search of the US Bureau of Transit Statistics indicates there were only 135,399,945 registered 'cars' on the road in 2006 (latest available figures), and only 250,851,833 total vehicles, including cars, trucks and 6,686,147 motorcycles to boot. Speaking of math, I think its safe to say that only a bona fide jerk could be wrong by over 200,000,000 cars...unless, of course, the car manufacturers have been faking their sales numbers the past two years.
I believe there is a convention in law, perhaps it is only tacit, that if a part of witness testimony can be impeached, then his/her entire testimony can be disregarded by the jury. In bars, a jerk guilty of this is known as a bull..ter and becomes a pariah, if not thrown out on his fat assets.
In the case of thinking people v bona fide jerks, the defense rests.
Posted by: martscan | January 26, 2009 at 02:18 AM
To Martscan, while ArthurGlen's post is a bit of a political rant, the underlying point is a valid one - is this the best use of funds to accomplish the goal?
Not long ago, GM indicated they thought EV was a "transitional technology" at best, and the holy grail was indeed hydrogen fuel cells. Apparently, that was the reasoning behind almost no serious focus on EV - they wanted to beat Toyota and Honda to fuel cells, anticipating a much shorter development period. History has shown the folly of that. At least in the short term.
But if ArthurGlen's "$7,500 and 1 million vehicles" is correct (I don't know if it is or isn't), that's a federal taxes expenditure of $7.5 billion. Would the ultimate goal of zero emmissions not be much closer if that cash was spent on fuel cell research? Do we need tens of millions of toxic batteries to dispose of in 10-15 years? Do we not create carbon emmissions generating electricity, which is currently 50+% coal in the US?
To declare EV the winner, and worthy of massive subsidy, ignores the science and longer term implications of the technology. Why not offer that subsidy to hydrogen? In the rush to be seen to be green, it looks like marketing trumps science.
Posted by: JS | January 26, 2009 at 10:04 AM
The market place would probably accept electric cars if the cost of electricity as fuel was less than the cost of oil as fuel. If we invested the $7.5 billion into research into superconductivity that would happen very quickly. Well over 2/3 of all electricity generated in the United States is lost in getting the juice from where it is generated to where it is used. Most of that is in the bulk conduction, for example from Hoover dam to LA or from the Tennessee Valley to the steel mills on the great lakes. If we are looking for places to cut waste that loss of electricity is the greatest waste in the country. It is also something that is relatively near to being feasible if money were thrown at it. Otherwise, the pollution and global warming caused by coal and gas generated electricity is greater than simply using oil to fuel the vehicle. I find it amazing that this is so little discussed, superconductivity would be the quickest and easiest way to increase our energy supplies!!!
Posted by: Gary Noel | January 26, 2009 at 12:21 PM
JS:
Am I missing something? Where is it written that projected "costs" of a hypothetical program are the ONLY funds earmarked for the goal of becoming independent of OPEC oil with respect to powering autos? Where is it written that one source of alternative energy, regardless of its application, trumps any other source of alternative energy, to the extent of their not receiving government credits or other monetary incentives? Where is it written that a hypothetical lost opportunity is a hard "cost"? Your contention of "...a federal taxes expenditure of $7.5 billion", and "...if that cash was spent on fuel cell research?", is nonsensical. "Cash" you don't have can't be "spent."
Speaking of fuel cell research, the Dept. of Energy has had outright fuel cell research grants available via its SBIR program for years, as has the Pentagon through the military services.
Its my understanding that Obama's proposed tax credits ($7000, not $7500) apply to ANY vehicle, plug-in, fuel cell or rubber band, capable of 150 mpg or equivalent...also, if memory serves, Obama once proposed a $10B venture capital fund for alternative energy research. And, I believe McCain was touting a $5000 credit and a $300M prize for advanced battery technology...apparently, John McCain 'sold out' even before he could possibly be president. Glen's post is not a "bit of political rant", its a lot of gobblygook.
Regarding GM and EV, why is it no one mentions that the EV1 car would have sold like hot cakes during the gas price spike...if it hadn't been scrapped...and its technology, including the battery intelligence, was sold to, of all people, Chevron oil? The point is that corporations are not formed to be patriotic entities, they are formed to make money for their owners, and they make decisions according to what they believe the market will buy. Period. There is no lack of money in this country for a viably marketable product...whether it be fuel cells or widgets.
Posted by: martscan | January 26, 2009 at 06:00 PM
Martscan,
The apparent mindset at the moment is “Prius good, Tahoe bad”. There is currently an obsession with electric cars as it is viewed to be the shortest path to reducing fossil fuels reliance. While it’s not specifically wrong, it’s worth noting that if Obama wants to act fast, EV is the technology likely to receive most of the “investment dollars” (or tax credits) he espouses. And we should be specific – it’s not the electric car that’s the problem, it’s the battery and charging time.
If the government enacts a tax credit of any size, that credit creates a tax hole that will have to be filled from something, and that means cash from a taxpayer’s wallet. And if "Cash you don't have can't be spent." was true, there would be no government deficits.
As for the DOE SBIR grants, yes, they have been in place for years, but they are in the millions, not hundreds of millions, and certainly not billions. Their current program allocates, according to their web pages, $100 mil up to 2010, a mere drop in the bucket of alternative fuels research spending. There has been an enormous amount of private money spent on hydrogen to date, I suspect because if/when it is perfected on an economic level, the rewards will be mind-boggling.
GM’s EV1 program was a technology that failed to materialize in a profitable product. At the time, as is now, electric cars are NOT PROFITABLE to their manufacturers on any kind of mass scale. 10 years into the Prius, Toyota’s investment has not been covered, although they arguably have achieved a "mindshare" dominance as a GREEN car company. GM made a decision to re-allocate capital to a technology that has proven a tough nut to crack. But what if they had sold EV1 cars “like hotcakes”? Presuming consumers would have elected to buy one, they projected a loss on every car, even selling at a price substantially higher than the Prius. So GM would have lost more money. Damned if you do, damned if you don’t.
I generally agree that “There is no lack of money in this country for a viably marketable product...whether it be fuel cells or widgets”. I personally abhor any tax incentive or government spending to move “alternative fuels” forward.
What I am asserting is that if Obama spends money (or provides tax credits) on this, and it’s almost a foregone conclusion he will, companies will flock towards electric cars, because that’s where the low hanging fruit will be. If the result is that money for other alternatives all but disappears, including zero emissions technologies like rubber bands, we’ll have shot ourselves in the foot yet again.
Posted by: JS | January 27, 2009 at 12:50 PM
JS:
You make an intelligent and cogent argument stated articulately, which I respect. However, I disagree with it.
My point is that whatever mitigates our dependence on foreign oil is fine with me. What's the difference what form the savings takes as long as it works?
Regarding the government creating a 'tax hole' that has to be filled by cash from taxpayers' wallets and comparing this to never having a deficit, is nonsense, on both counts. To begin, the incentive, tax credit, by definition is offered to bring about an event that wouldn't ordinarily happen without the incentive. A taxpayer with, say, a $25,000 tax liability buying a $40,000 car and receiving a $7,000 credit would then have a tax bill of $18,000...ostensibly "costing" the federal govt his $7,000 tax savings. But, no one knows if the taxpayer would have bought a conventional car, or not, rather than the new tech car with the tax benefit...whatever that technology might be. Tracking backwards, tell me how much in federal taxes were paid in making the car, beginning with design, engineering, manufacturing, etc, etc to delivery and the wages paid to a dealer's car hiker, before the $7,000 so called 'cost' even enters the picture...that arguably wouldn't have been made without the incentive? Going forward, the car purchaser immediately pays over $3,500 in sales taxes, albeit local, they support public employees that pay federal taxes and, knowing the current velocity of a dollar (I'd guess 6-8X), it wouldn't be too difficult to calculate a total amount garnered by the federal govt in tax revenue from the sale of this car..and the one built to replace it in inventory....and the figure will easily surpass the $7,000 deducted from the purchasers tax bill, making a so called cost an actual net gain. With respect to federal deficits, they are the result of financings, borrowed money...and bear no relationship to what amounts to a tax cut vs an expenditure.
You state that Toyota has yet to make a profit with Prius. I don't know where you source your information, but I do know that I've read statements from Toyota executives, as early as 2003, that Prius was profitable. Also, Goldman Sachs' analyst, Kota Kuzawa states that Prius will produce 10% of Toyota's total company profits by next year. If this is true, I doubt the division goes from negative to incredibly positive overnight...rather it probably has enjoyed incremental gains from year to year. The fact of the matter is that no one outside of Toyota knows what Prius' financial critical mass is, or how the company treats expenses attributable to Prius.
If someone is drawn to a Toyota showroom out of curiosity to see a Prius, and ends up buying a Camry, is any part of that sale attributable to Prius? It is not arguable that Prius has won the green 'halo' for Toyota...witness Bob Lutz's denunciation of the Prius years ago, and his penchant for egomaniacal failures has forfeited any hope of GM ever catching Toyota's technological lead. Given GM's track record of not being able to forecast major consumer trends..not to mention their obsession with concept cars and contrived obsolescence, rather than producing reliable, profitable cars that people really wanted...I doubt anyone can make reasonable prognostications and presumptions about GM's EV prospects, when its clear that they can't do it themselves.
With respect to govt incentives, we are at opposite ends of the spectrum, and I suspect this may reflect our philosophies having to do with the role of govt. I am in favor of incentives regarding alternative energy because it is a matter of national security, in fact, we should have instituted a 'Manhattan' type project for this purpose years ago. Of course, the clout of big oil and 'Detroit' has prevented this. I am opposed to corporate hand outs, veiled as incentives, such as the ethanol fiasco on top of the Farm Bill fiasco, to name but one. And I say this as someone having considerable farm interests.
It is my belief that whatever Obama does, it will be in the best interests of the most people to the best of his knowledge...and not corporate special interests as has been our tacit policy for as long as I can remember.
Posted by: martscan | January 27, 2009 at 09:58 PM