Solar Bright Spot

With many of California oil fields in decline, they are requiring steam to extract the last parts of oil out of the rock.

Interestingly, solar thermal is turning out to be a very cost effective way to make that steam.  In fact, steam produced by plants built by BrightSource Energy are making the steam 25% cheaper than a new natural gas fired generator.  That is saying something because natural gas is at a 20 year low in price.

BrightSource makes steam by pointing a field of mirrors up at the top of a 300 ft tower.  There, the heat from the mirrors instantly converts water to steam.  The steam is then injected into the reservoir to improve the viscosity of the oil so it can be coaxed from the rocks.

This is a win for everyone. 

Gold Bubble

Gold is near and dear to people’s hearts.  My Grandmother was a “goldbug” and followed gold mining stocks daily.  Gold even has “smart” investors like Glenn Beck promoting it.

There is a gold rush going on right here in front of us.  This is a sure danger sign that we are in bubble territory.

Notice the commercials for buying gold?  Notice how gold has been one of the best performing asset classes over the last 4 weeks?  I’d say we are building a gold “climax run”.   These always end badly.  US realestate went on a climax run in 2006, with prices appreciating 2% per month.  We all know what happened afterwards.

Just when it looks like you can’t lose money on something - watch out below.

Look how oil ran up to $150 in mid- 2008 only to see the price get crushed back to $35 in a few short months.

Once people start running for the exits on gold - watch out below!  Prepare to short it.

Bike Commutes Make Time, Car Commutes Suck Time

It was no surprise when I read a Slate article on the problems with long, passive commutes.  I thought these commutes merely caused some extra stress.  It turns out that long commutes increase obesity, divorce rates, neck pain, insomnia and overall happiness levels.  

There is certainly a cost to owning that “cheaper” home in the suburbs.

My own opinion is that the human body does not like to be idle for long periods.  Cars are especially good at captivating and restricting  occupant movements.  Throw in some congested traffic and voila - we have some road rage.  

When it all seems difficult to find funding for cycling infrastructure and safety programs, decision makers need to know some of these hidden costs of driving and some of the unknown benefits to cycling.

Cycling not only helps the cyclists improve their health, but it helps the vehicle drivers reduce their stress by reducing traffic congestion.

So, what are you waiting for?  Add time and well being to your life and start cycling now.  Join an organization that helps bicyclists.  I personally am a director at the non-profit Sustainable Streets that promotes active transportation through educational workshops and promoting Safe Routes to Schools.

Is the iPad a laptop killer?

I am sitting here making this post on my iPad. However, I am typing on a regular keyboard. I have the logitech/Zagg bluetouth keyboard and iPad case (www.zagg.com). I can pretty much do everything on here I can do on a laptop, but with the added convenience of a touchscreen.

If tablets kill the laptop category, it would be detrimental to Apple and everyone else in the laptop business.

When I say an IPad can “pretty much” do what a laptop can do, there are some key features Apple has left out to make this not quite work as well as a laptop. I do believe Apple is withholding some of these critical software upgrades so customers will still feel compelled to buy a laptop.

I especially think the college market would love this setup (the Ipad/keyboard combo) because of the long battery life, touchscreen and super light weight.

So, what has Apple done to constrict features on this machine.? For one, the file system makes it really inconvenient or impossible to send emails with attachments. Secondly, only 200 emails can be stored on the machine. This was really inconvenient for me today when I was down at the beach attempting to search for an older email while I was out of cell range to search on the server. Third, printing from the Ipad is insanely stupid. I bought a $10 print application, but Apple won’t let it interface directly with the Apple Mail application, so printing out an email is a multistep process involving going into another application. Also, web pages can’t be printed directly either, unless there is really new printer around that the IPad can work with.

So, given the above limitations on the iPad, it cannot yet fully replace a laptop. However, this just creates a fabulous opportunity for other manufactures to create a better tablet.

Eventually, Apple will either have to evolve or risk becoming the next Microsoft, where they don’t innovate in step with the market and their stock just drifts downward for a decade.

China and Africa - Friends or Foes?

China’s influence and

reach around the world is astounding.  In particular, China’s trade with Africa increased from a mere $2 billion in 2000 to $60 billion in 2010.  

China loves Africa’s natural resources, low wages and easy exploitation of workers and the environment with little transparency.   Since western democracies and the companies based there tend to shy away from juristictions were it takes bribes to make things happen, China has had little competition doing deals in Africa.

However, according to the The Economist, Chinese firms are experiencing a backlash in Africa as a result of shoddy workmanship, rampant on the job deaths and environmental degradation. 

So, Africa is in a tight spot.  It needs the investment and expertise and China is the only country really stepping up to supply it.  So, although there is downside to Chinese involvement in Africa, there is upside as well.

African countries just need to demand better quality higher wages and improved working conditions.    This is the only way Africa can have an harmonious relationship to China.

How Green is Natural Gas?

A recent Cornell study concludes that electicity produced from natural gas fired turbines is far more carbon intensive than previously thought; even greater than coal.  The study whose principal author is Robert Howarth uncovers some of the previously undistinguished leaks in the natural gas production system.  

First energy is expended to begin producing energy.  Geological surveys, geophysical work, drilling and getting a borehole production ready all consume energy.  With natural gas production wells need to be vented (and the excess gas is burned most of the time), there are numerous leaks through the pipeline delivery system, and well fracking all add to carbon emissions.    

Here is an example of a horizontally drilled well into shale that can produce shale gas after fracking (high pressure fluids, sand and ceramics are pumped down hole to crack the shale and keep it propped open).

Most troubling is natural gas leaks are methane, which is much more powerful at generating the greenhouse effect than straight carbon dioxide (which is produced after methane is burned.

This is also related to methane production as a result of cows (how can I put this delicately?) farting all day long out in pastures around the world.  Cows generate 18% of all greenhouse gas emissions.  We could all do ourselves a favor and begin to cut back on animal based protein as part of the quest to reduce waistlines and reduce our effects on global warming.

Interestingly, the China Study by another Cornell researcher T. Colin Campbell points to the deleterious effects of animal protein on human health.    So, the conclusion here is eat veggies, carpool and try not to fart too much.

Nuclear? Non, Merci

While recent events in Japan have the world all twitterpated about nuclear power, the facts remain the same.  Nuclear power is not economic in terms of return on investment.

While it is true that older plants create significant free cash flow, new plants are too expensive to build, resulting in negative returns on investment.  That is why  nobody has broken ground on a new plant in the US, because even with loan guarantees, plants need direct subsidies to make them work economically.

Maybe the situation is different in China in terms of plant costs, but in the US, new builds do not make sense.

Are Solar Companies Hoping to Double Panel Sales This Year?

The solar industry is getting big, but will it double in 2011 over 2010?  Solar companies are expected to double capacity to 36 gigawatts this year (the equivalent of 36 nuclear power plants!).  Capacity is the key word there.  Yes, they will likely double capacity as they have been generating 100% IRRs on new plant construction.  More is better, right?

The problem is sales need to double in order to fill all that capacity.  Will that happen?  I personally do not think so.  Last year, the industry was saved by Italy catching a Hail Mary as they installed about 5 times the number of power plants they had originally had forecast.   That will not happen in 2011 according to sources in the government.  Within the next couple of months the subsidy incentive spigot will be turned off.

So, who will create the demand for all this new supply?  It must come from countries willing to subsidize the installation of the solar plants.  The US?  No way, not with the current government makeup.  What about Africa?  There is not enough money there. 

The only country with the willpower to really put on capacity is China.  Unfortunately, China has just announced that it will be studying the successes and failures in Europe’s solar programs this year, and will announce something for 2012. 

The bottom line here is that the solar component industry is operating in a state of hope.  Probably only 10% of the planned installs have money down on the equipment.  This is a train wreck in the making.  Expect a very volatile year for the solar component manufacturers as selling prices get crushed by the excess supply.

Potentially the only beneficiaries in this situation will be installers in jurisdictions where subsidy levels remain high and there is budget to subsidize a robust pipeline through 2011.  It looks like the US installers could be the big beneficiaries of this impending price drop in component prices.