21st Century Growth Platforms Growth has nothing to do with moving beyond oil, or finding better ways to sell 'new' cars. In fact, we must get over this notion of a 'new' car industry model. What other industry manufactures a $20,000-60,000 product without a pre-arranged buyer?
Growth has everything to do with:
1) Reducing 'Manufacturing Footprint' Lowering costs by moving beyond the combustion engine manufacturing platform towards modular electric drive trains powered by the integration of batteries, fuel cells and capacitors.
2) Software Services & After Market Shifting revenues towards the software-service side of the driving experience, and physical 'after market' design upgrades. GM should profit 'per mile', not 'per vehicle'. Dealerships need customers that buy some new upgrade every month, not one vehicle every few years.
3) Rebranding as a Mobility Service Company Why should GM be limited to a brand for personal vehicle ownership? Develop new categories of mobilty products (e.g. personal urban vehicles). Integrate products and services into a broader 'mobility services' sector that blends private and public transit options. (Realize you aren't in the 'new car' business, but in mobility services)
Many of GM's leaders like Sr VP Larry Burns, (Mr. 'Skateboard kills Car') understand this new reality, and I wish they'd be more public about a new vision for mobility and jumpstart this multi-decade long transition. I'm not talking about an 'ad campaign', but a clearly stated vision that inspires the next generation of mobility industry entrepreneurs.
Fixated on Building better 'Buggy Whips' (and Related Posts)
One of the great efficiency opportunities for the next century is based on the convergence of information and energy flows. The notion of a 'smart grid' is a more reliable and efficient energy web based on the integration of software, sensors and energy storage.
And for those homes with 'Smart Meters' or Smart Devices, solutions are coming online quickly. Google has now thrown its hat into the ring around the basic idea: 'if you can measure it, you can improve it'. The Google Power Meter is a software tool integrated into smart meters that helps consumers better understand how they use energy in order to reduce their costs and consumption. Google is a big name, in an expanding space of 'smart energy' startups, like Sentilla and REGEN, who are trying to build demand in the residential market.
Related Smart Grid posts on The Energy Roadmap.com
The Clinton Foundation has announced a plan to help the City of Los Angeles retrofit 140,000 street lamps with more efficient white-light LEDs that offer longer lifetime, lower energy use and less 'light polllution' that restricts night sky views.
The Outdoor Lighting Program of the Clinton Climate Initiative (CCI) will be the largest LED street lighting retrofit project ever undertaken by a city to date. The City expects to reduce its electricity use by approximately 40,500 tons a year equal to taking '6,700 passenger vehicles off the road every year.' The Foundation expects the city to save save a total of $48 million over a seven year period, and reduce carbon emissions by 197,000 tons.
A National Model for Saving Electricity & Night Sky Views?
Oil Supply Crunch ahead The world's leading authority on oil markets is warning that these days of cheap ($40 barrel) oil are just a mirage and that the world is likely to experience 'an oil supply crunch' next year (2010) as markets begin to recover.
Reuters reports on IEA Executive Director Nobuo Tanaka describing a potential short-term reality: "Currently the demand is very low due to the very bad economic situation, but when the economy starts growing, recovery comes again in 2010 and then onward, we may have another serious supply crunch if capital investment is not coming."
The Real Problem with Oil - No Alternative Oil's biggest problem is 'lack of substiitutability'. There is no other 'reserve' of liquid fuel that can compare to the energy locked up inside the hydrogen-carbon bonds of oil.
If we talk about using oil as gasoline for the transportation sector there is no commercially viable alternative that offers the same volume and performance. Even 'Next Generation' biofuels from algae and cellulose-eating bacteria cannot provide the scale to fill even a tiny gap in global oil production vs demand.
People who push 'solar', 'wind' or 'nuclear' (which produce electricity) as an 'alternative to oil' simply do not understand the combustion engine. You cannot put electricity inside your gas tank. We must either produce massive amounts of liquid fuel substitutes, or take a bolder step to kill the combustion engine.
Is the world ready to confront the real problem? The Combustion Engine
President Obama is close to naming the ‘Car Czar’ who will oversee a large portion of the federal auto loans and consult on the looming transformation of the US auto industry. Let's hope this person doesn't try to build a better buggy whip.
Most ideas out on the table are incremental (e.g. ‘better mileage’), or short-sighted (e.g. plug in batteries?) and fail to inspire disruptive changes that reflect a 21st century version of the transportation sector.
Here are Ten Ideas for the US Car Czar:
1) Lower the US Auto Industry I.C.E. 'Manufacturing Footprint' The problem isn't oil, it's the cost complexities of building mechanical engines. Declare the Internal Combustion Engine ‘Dead’ by 2025 (When more than 50% of new vehicles will be powered by electric motors) Have automakers share combustion engine plants and suppliers during the transition.
2) Accelerate the Electricification of the World's Auto Fleet At the same time expand the US manufacturing base around the 'next' generation platform for mobility: Electric Drive systems based on high performance motors, drive by wire systems, software and various energy storage devices.
3) Explain ‘Electrification’ clearly to the public ‘Electric’ refers to the motor, not just the battery. Next generation 'electric' vehicles will integrate batteries, fuel cells and capacitors. Fuel cells produce electricity. A hydrogen powered car is an electric car. Let’s stop the confusion and battle between technologies. Cars are not iPods, and will need various systems to function. This is a multi-decade long transition. Don't pick short-term winners.
4) Go Global - Expand our ties to Asian Manufacturers & Markets Electric cars are not designed to be built as one unit, in one country. They are assembled systems of systems that can be constantly upgraded via a global value chain. The line of 'new' car vs 'old' car blurs when we shift to modular electric platforms. And all the real growth will happen outside of the US! 'Detroit' must participate in this global supply chain and be in a position to sell 21st century vehicle systems to Asian markets. (Hint: The high value auto industrial base will revolve around polymers, software and sensors, not metal frames.)
5) Software Side of Car Experience The single greatest opportunity for the next century might be the ‘software’ side of the automobile experience. Smarter vehicles embedded with sensors and ‘situation awareness’ systems, customized driving experiences based on ‘drive by wire’, and mobility services (e.g. OnStar). The US can compete in this new growth market and benefit by getting 'more flow' out of our current roadway system as we make drivers and cars smarter. (PS - Mass Transit could use some software to create service transparency)
Read on: 6) Build next generation energy systems; 7) Reinvent the Wheel; 8) Fleet only for Plug-ins; 9) Shift Revenue streams to After Market 10) New 'types' of vehicle & service
Reducing the amount of water needed to grow crops and prevent massive desertification could dramatically reduce the need for energy used in producing fertilizers, irrigation and desalination.
Hydrophobic Sand Nanowerk has featured a story written by Derek Baldwin of Xpress News on the development and use of layers of hydrophobic (water resistant) sand that prevents water from evaporating to keep it closer to the root systems.
The nano-coated sand could be used as a sub-layer for farming, urban landscaping, and a wide range of eco-friendly industrial applications like oil spills.
The proprietary coating process was developed by UAE-based DIME Hydrophobic Materials working with German scientist Helmut F. Schulze. The product's performance has been verified by a German materials testing agency (without details on coating's own environmental impact or longevity) and is now in pilot projects in the United Arab Emirates. Visit: Photo Gallery/Pankaj Sharma
MIT Technology Review has a great post on the use of (bee) 'swarm' inspired algorithms to reduce energy consumption of networked appliances like air conditioners, computers and heating systems. Toronto-based startup REGEN ENERGY is building smart energy platforms using new technology standards like Zigbee and micro-controllers to 'maximize collective efficiency'. Their trick is to enable 'bottom up' self organized smart grids for appliances without having to actively manage their energy consumption with a 'single order'.
We're just a month into 2009 and it already looks like Jeff Hilford's prediction that the future will become a big media topic this year is coming true.
Hilford: The present stinks and people will turn their attention elsewhere. While many will pine for a return to the past they will be forced to look ahead. The doom and gloom of the economic meltdown and global warming combined with the incredible pace of technological change provide a fertile backdrop for projection.
Watching last night's Superbowl with a group of friends, my fractured attention was thoroughly captrured by the following GE ecomagination commercial featuring non other than a "wired" version of The Wizard of Oz's scarecrow dancing atop an electric sub-station:
From the Spot: Smart Grid technology from GE will make the way we distribute energy more efficient simply by making it more intelligent.
The ad succeeds at bridging technology with familiar non-threatening themes already loaded into our cultural consciousness. Clearly it is meant to sychronize with the Obama administration's recent and mounting rhetoric about smarter national infrastructure and influence how the latest $900 billion economic stimulus dollars will be spent.
It's also indicative of an impending shift to new industry that players like Google, IBM, Cisco and Johnson Controls (add GE = The Futuristic 5?) have been chomping at the bit for.
The future you hear about on the news is not what it appears.
Yes, the 'electric car' is coming, but do not be fooled by first generation ideas being fed into the mainstream media.
The short term challenges are probably being understated as the transition will take many years to unfold. But the long term disruptive changes are more profound than anything you might see on a 60 Minutes special featuring battery car owners in California.
Electric vehicles are likely to change our energy grid, roads, cities and suburbs in ways that are hard to imagine today.
Software - Drive by Wire & The Digital Driving Experience While stodgy Wall Street Journal Op-Ed pieces continue to characterize electric cars as expensive, wimpy cars- there truth is that electric drive systems offer a lower cost manufacturing platform and a flexible software based driving experience.
Establish software and location based services to vehicles, and you create a foundation for revenue streams based on mobility services in a 'wired and connected vehicle'. (Not to mention 'pay per mile' funding streams for transportation infrastructure instead of paying per gallon taxes.)
Companies like Johnson Controls, Microsoft, Intel, Bosch (et al) are developing 'drive-by-wire' software and microcontroller solutions that can make a car sound and feel like a Ferrari, a Mini-van, or Sedan with the push of a button. There is a huge upside in software-service sales that the digitize the driving experience.
Storage: Vehicle to Grid (V2G) & 'Skateboard' Vehicles on Sidewalks
Beyond the occassional post (or two), I have avoided 'Peak Oil' production issues because of its association with those who must always (and only) describe the future in apocalyptic terms.
But based on the IEA World Energy Outlook 2008 report, it has become clear that energy leaders have been using poor data of oil field decline rates (based on a lack of transparency) to support inaccurate forecasts.
Whether peak production has already happened, or will happen in 15 years is irrelevant since we are not prepared for either transition. So it is time to explore implications regarding the world's use of coal, nuclear energy, tar sands, and oil shale. (For those focused on Climate Change, the replacements for oil are not good news for carbon emissions.)
I do not believe that Peak Oil will destroy our civilization, but it certainly has the potential to make us humble, and to serve as 'the' catalyst for evolving our policies from a resource extraction to resource creation paradigm.
The following 40 minute interview is dated (January 2008) but gives a solid overview of peak oil's core issues: field decline rates, discovery rates, production time and costs and lack of real liquid fuel alternatives. [A more current hard edged interview by George Monbiot w/ Dr Fatih Birol: Link to video]
The booklet 2063 A.D. (Free PDF download; $25.30 print) was published by General Dynamics Astronautics, and placed into a time capsule in July of 1963.
Only 200 copies were ever printed. The 50 page book contains predictions by scientists, politicians, astronauts and military commanders about the state of space exploration in the year 2063.
As you'd suspect, given General Dynamic's business, there are many predictions about space travel, lunar bases and cheap energy resources. (So there is still time yet for their forecasts to come true!)
Lulu's edition is a reprint made from scans of the original 1963 book.
If you like this type of historical futures also check out the blog Paleo Future