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The Plethora of Better Alternatives to Wind/Solar Power and Electric Cars

Highlights

  • Current technology-forcing policies imply that wind/solar power and BEVs are our primary solutions for building a sustainable society.
  • This article reviews eight alternative sustainable development solutions with greater fundamental potential.
  • These include improved “life efficiency”, virtual mobility, healthy lifestyle choices, energy efficiency, CCS and bio-CCS, small electric vehicles, sustainable fuels and nuclear energy. 
  • Overall, I estimate that technology neutrality can activate more than 10x greater sustainable development potential than current technology-forcing policies. 

Introduction

The previous article summarized the dangers of current technology-forcing of ideologically attractive wind/solar power and battery electric vehicles (BEVs). This article will discuss some of the wide range of alternative sustainability channels that would thrive under a proper technology-neutral policy framework, greatly accelerating global progress towards our sustainable development goals.

A subsequent article will then make the case that the current norm of promoting a chosen technology class as the dominant solution actually extends the reign of fossil fuels. If we want to move past the current wasteful and unhealthy fossil fueled consumerist mindset, technology neutrality is the best way to get there, while technology-forcing may well hurt more than it helps.

The most important pathways to sustainability are listed below in order of importance (IMHO). All of these pathways will be strongly promoted by technology-neutral policies, but are left untapped under current technology-forcing frameworks.

Improved "life efficiency"

This first one is a bit unconventional, but please bear with me. Energy and carbon efficiency, i.e. how much economic output we can get from a given amount of energy or CO2 emissions, have become accepted economic performance indicators. However, the most important measure should actually be how much life (combination of life satisfaction and life expectancy) we can get out of a given quantity of energy, carbon emissions or economic output. Let’s call this “life efficiency.”

The current status quo is to get stuck in the consumerist spiral illustrated below, yielding terribly low life efficiency. Our outdated culture tells people that they should strive to consume themselves to happiness, something that is only remotely possible in a Utopian world of perpetual exponential material expansion. This results in an expensive lifestyle, which forces people to work for money instead of creative expression. As a result, people are often unhappy in their jobs and, based on their social conditioning, believe that this unhappiness can be alleviated with even more consumption, thus completing the spiral.

This spiral represents a massive waste of society’s productive capacity. People force themselves to produce things that do not inspire them so that they can afford the fleeting highs of consuming things produced by other people who are stuck in the same vicious cycle. Globally, this inefficiency is far greater and more harmful than big inefficient SUVs or coal-fired power plants.

The more evolved alternative to the vicious cycle above is shown below. In my opinion, this virtuous cycle is the key to a sustainable 21st century society. It allows people to increase happiness by producing more and consuming less, thus creating the large surplus productive capacity we will need to overcome our great 21st century sustainability challenge. This cycle will be further strengthened by ever-increasing automation of mundane and uninspiring jobs.

This philosophy is certainly growing and I sincerely hope that it will someday reach a tipping point to spread virally through our interconnected society. True technology-neutral policies that generally make wasteful consumerism more expensive could well provide the catalyst that pushes us over this threshold.

Virtual mobility

I am a big fan of car-free living. As emphasized in an earlier article, this philosophy can only moderately reduce transport sector emissions, but it can greatly improve economic efficiency. As a result, it can accelerate economic growth without the associated energy growth, which is crucial for longer-term sustainability.

My estimate of the total economic benefits of telecommuting (working from home using a computer connected to the mainframe of your employer) is $18500 per year per person. This is absolutely huge. As shown below, the direct energy (fuel) savings account for a mere 4% of the total saving. The remaining 96% of the economic benefit is spread over a range of other areas.

The daily commute is just one area where virtual mobility can generate huge savings. Online retailing and doorstep delivery is already a major trend and is poised for massive future growth. This trend can greatly reduce the fuel, depreciation, maintenance and time costs of driving into town for shopping. Fancy energy-inefficient retail outlets in expensive areas of town can also be replaced by simple and efficient warehouses in cheaper areas, bringing large additional savings.

These trends will strengthen with improved telecommunications technology. When virtual meetings approach the efficiency of face-to-face meetings and virtual shopping approaches the efficiency of physical shopping, these trends will be unstoppable. This should happen within the next couple of decades.

A broad range of knock-on effects will follow from this development. The most beneficial of these will probably be car-free city zones – economically efficient, clean and highly attractive places to live. Technology-neutral policies addressing climate change, local pollutants, traffic congestion, and true costs of roads and parking spaces can greatly accelerate these positive developments.

Healthy lifestyle choices

There are two healthy lifestyle choices that can greatly reduce CO2 emissions: a more plant-based diet without excess calories and more travelling by walking/cycling instead of driving.

In general, red meat is very carbon intensive. And like most other carbon intensive things, one can easily learn to live without it. I grew up with lots of red meat, but have now cut it out completely. However, full-out vegetarian or vegan is a step too far for me due to limited carbon benefits and too much compromise to get all the required nutrients.

Annual equivalent emissions (ton CO2e) from five different diets (source).

Just as importantly, simply stopping overeating can save a lot of emissions. The average American consumes 50% more calories than the recommended daily allowance, shockingly resulting in a mere quarter of the population not being overweight or obese (see below). Based on the graph above, the average American meat lover can save a massive 2 tons of CO2 annually by cutting out red meat and reducing calorie intake to healthy levels. Savings in the land footprint required to produce food will be even greater, making it a lot easier for the world to feed its rapidly growing middle class.

In addition, supplementing the virtual mobility trends above with more walking and cycling can result in substantial carbon savings. Avoiding only 3 miles of daily driving in a large SUV through these channels can cut a ton of CO2 annually.

Most importantly, however, obesity and sedentary living are important drivers behind the degenerative disease epidemic sweeping the globe. The US spends an unbelievable 18% of GDP on healthcare, most of which is attributable to so-called “lifestyle diseases”. Lost productivity from poor health adds another large cost.

From a macroeconomic point of view, this pattern of directing a lot of productivity towards self-destructive consumption and then spending a lot more productivity to try and minimize the resulting damages is just ridiculously inefficient. This becomes all the more ludicrous when considering that decarbonizing the US economy for a rather high average cost of $100/ton CO2 requires less than 3% of GDP.

Technology-neutral policies will automatically make healthy lifestyle choices much cheaper relative to conventional excessive meat-heavy diets and sedentary living. This will directly avoid a lot of carbon emissions and, more importantly, free up a lot of highly educated productive capacity to build a sustainable society instead of fighting our self-imposed lifestyle disease epidemic.

Energy efficiency

Energy efficiency is often cited as the most important sustainability technology class at our disposal. I have recently confirmed that it is generally the lowest cost energy alternative when externalities are accounted for.

[caption id="attachment_5928" align="alignnone" width="474"]

Projected contributions for reducing CO2 emissions from the reference (RTS) to 2 degrees Celsius (2DS) scenario.

Projected contributions for reducing emissions from the 2DS to the beyond 2DS scenario of the Paris agreement. On the right-hand graph, 2DS is represented by the lighter areas and B2DS by the darker areas.

That being said, energy efficiency still implies a cost relative to the status quo in most cases. The three topics discussed earlier result in net economic benefits (often huge benefits) and therefore have much greater potential to solve our great 21st century sustainability challenge.

Energy efficiency can be improved in essentially any application that uses energy. This massive diversity of application makes it especially suitable to technology-neutral policies. Energy efficiency can therefore be expected to do especially well when current inefficient technology-forcing is eventually replaced by technology neutrality.

For those who are wondering where autonomous vehicles fit in this list, I categorize this technology partly under energy efficiency and partly as an enabling technology for car-free living (virtual mobility, small electric vehicles and healthy lifestyle choices).

CCS and bio-CCS

It is now finally becoming more broadly accepted that carbon budgets with a good likelihood of avoiding irreversible climate change damages are not achievable without CCS. Given that most of the global economy is yet to be built, the aggressive climate mitigation pathways illustrated below are simply not going to happen. This will result in massive (and growing) emissions gaps by 2030 that will require very rapid emissions reductions and broad deployment of carbon negative solutions later this century.

Illustration of rapidly growing emission gaps that will enforce carbon negative solutions later this century.

CCS is very well suited to such a belated rapid decarbonization scenario. It can cut industrial emissions that are not accessible through other channels, it can avoid emissions from existing infrastructure through retrofits, and it can achieve negative emissions through bio-CCS and direct air capture.

There is also a more controversial reason behind the importance of CCS: fracking. Despite the associated environmental challenges, the enormous positive economic impact of abundant locally produced unconventional oil and gas is undeniable. The US has clearly demonstrated the impact of this controversial technology, having already produced an incredible 7x more energy than the entire world produced from wind and solar to date.

Developing nations will not miss out on this growth opportunity, resulting in continued increases in fossil fuel combustion. Abundant CO2 from CCS can also significantly increase productivity from local oil and gas activities through enhanced oil/gas recovery, potentially even replacing water as fracking fluid in water-stressed regions.

Technically recoverable shale gas reserves (source). For perspective, global natural gas consumption is about 3.6 tcm/year.

CCS deployment will happen completely naturally within a technology-neutral CO2 pricing scheme. It is also very important to mention that the longer we delay the implementation of proper technology-neutral policies, the greater the need for CCS becomes. Placing CCS at this position on the list assumes that we will not see meaningful CO2 pricing (over $50/ton in all advanced economies) for at least another decade.

Small electric vehicles

Personal mobility in any city that is not built on the American urban sprawl model is well suited to small electric vehicles (SEVs) such as e-bikes, low-speed 3- or 4-wheelers, and electric scooters. This makes SEVs especially applicable to rapidly growing and very densely populated developing world megacities.

The main benefit of an SEV is that it can grant similar personal mobility to a car at a small fraction of the cost. Unsurprisingly, e-bike sales have recently shot past electric car sales in the world’s electric car capital, Norway, where electric cars enjoy a wide range of incentives to the tune of $30000 per car. In China, e-bikes sell about 15 million units per year, while massive electric car technology-forcing achieves about 0.7 million units per year.

Technology-neutral policies will level the playing field between SEVs and electric cars, resulting in an even greater SEV dominance. Trends towards virtual mobility and car-free city zones will further boost SEVs relative to electric cars. This trend will be especially strong in developing nations where most people simply cannot afford a car, and SEVs are critical to economically include poor communities (as quantified earlier).

Sustainable fuels

A previous article reviewed the broad range of fuels that offer an alternative to oil. These fuels are primarily associated with the transport sector, but can also make large contributions when it comes to industrial applications and space heating.

In the transport sector, these fuels offer broad applicability to all sectors including heavy freight, aviation and maritime. BEVs are limited primarily to passenger light duty vehicles (PLDVs), where they quickly lose attractiveness for longer-distance applications.

Oil consumption in various transportation sectors (source).

The current popular vision of electrifying everything makes very little sense in absence of a true breakthrough in electricity storage (e.g. $30/kWh and 1 kWh/kg fully installed batteries made from truly abundant materials). Until such time, we will be exploiting the inherent highly concentrated energy storage offered by various fuels. Fuels will also remain critical for industrial processes requiring a strong reducing agent or very high grade heat. The market will confirm this notion when technology-neutral policies are eventually implemented.

Nuclear

I’ll probably get some criticism for putting nuclear last on the list, but recent history has shown that current nuclear technology will not make a large contribution to 21st century sustainability. As outlined in an earlier article, however, next-gen nuclear has great potential for the long-term.

The decline of nuclear and rise or wind and solar over the last two decades (source).

Wind and solar will probably overtake nuclear in about a decade’s time, but are likely to encounter substantial integration challenges not too long afterwards. At that point, next-gen nuclear will come into clearer focus as a technology with the potential to take society to the goal of a completely sustainable, abundant, reliable and safe global energy supply. An earlier article discussed this in more detail.

Technology-neutral policies will naturally benefit nuclear relative to the fossil fuel status quo. These policies are also critical to accelerate the development of next-gen reactors so that they are ready by the time that fossil fuels have built most global infrastructure and wind and solar power encounter major integration challenges.

Conclusion

This lengthy article has hopefully illustrated that we have plenty of highly attractive alternatives that are being neglected within current technology-forcing policy frameworks. Technology-neutral policies (primarily a carbon tax) will automatically activate all of these pathways, greatly accelerating the journey to sustainability without hurting economic development.

In terms of importance, I would put wind and solar power directly after nuclear, followed by electricity storage technology. They are certainly important players, but are very far from the dominant sustainability solutions suggested by current technology-forcing policies for the reasons outlined in the previous article. Other clean energy solutions such as nuclear fusion, ocean energy, algal or ocean biofuels, and advanced geothermal may also make significant contributions later this century.

Our goal over the course of the 21st century is to develop the global economy to the point where everyone has a fair shot at reaching their full potential (currently only about one in every four people enjoy this privilege), and do so within a carbon budget that will probably be well into the red in two decades’ time. As a final illustration, I have made some rough estimates of the fundamental potential of the aforementioned pathways to meet this goal.

Current inefficient policy frameworks probably activate less than 10% of the sustainable development potential at our disposal. Simply transitioning from technology-forcing to technology neutrality can turn this 10% into 100%, thereby giving us a fair shot at building a truly sustainable global society.

Content Discussion

Jarmo Mikkonen's picture
Jarmo Mikkonen on May 7, 2018

The current popular vision of electrifying everything makes very little sense in absence of a true breakthrough in electricity storage (e.g. $30/kWh and 1 kWh/kg fully installed batteries made from truly abundant materials).

Tesla just announced a quarterly loss of over 700 million with revenues of 3.4 billion.

GM North America announced a profit of 2.2 billion with revenues of 36 billion. GM sells Chevy Bolt EV, about 1500 a month. Apparently they do not wish to sell more of these loss-making vehicles but want the ZEV credits.

Bob Meinetz's picture
Bob Meinetz on May 7, 2018

Jarmo, GM does not wish to sell more GM Bolts? That must be why they’re making them as fast as they possibly can (limited only by battery production) and are increasing production “to meet growing global demand.”

They’re not making more to sit in showrooms.

Jarmo Mikkonen's picture
Jarmo Mikkonen on May 7, 2018

By getting the ZEV (or CARB) credits GM can sell conventional trucks and SUVs in states like California without having to buy credits.

For example Elon Musk said:

That’s why you shouldn’t ask like why, well, GM appears to be losing $10,000 a car on the Bolt. No, they’re not. They are making it up on CARB credits. But they get the full retail value of the CARB credit, whereas we get the wholesale value when we’re lucky. But the CARB credits are only effective at a production rate of about 20,000 to 30,000 vehicles a year. So that’s why you’ll see, mark my words, it’s not going to be any higher than that for the Chevy Bolt.

https://insideevs.com/elon-musk-talks-carb-zev-credits/

Mark Heslep's picture
Mark Heslep on May 7, 2018

…but recent history has shown that current nuclear technology will not make a large contribution to 21st century sustainability

This statement is of course arguable, though if the metric for all alternatives is evidence of global generation share, and that nuclear is stagnated at the moment despite sixty reactors currently underway, then fair enough.

Yet elsewhere in the articles is this

… is now finally becoming more broadly accepted that carbon budgets with a good likelihood of avoiding irreversible climate change damages are not achievable without CCS

…though the global generation share of CCS is near zero, and is exactly zero in the US. That is, there is no existant evidence that CCS is feasible as a 21st century solution, unlike nuclear power. Strike “CCS” in that last sentence and insert nuclear, whether there is “broad acceptance” or not, nothing else comes close to resolving the emissions problem of power generation.

Rick Engebretson's picture
Rick Engebretson on May 7, 2018

The most appealing thing for me would be to ride an electric bicycle on a European tour. My wife and I rode bikes and train from St. Paul, MN to Quebec City in 1976. We were fools, but bicycles are fun.

Bob Meinetz's picture
Bob Meinetz on May 7, 2018

Jarmo, two different issues. The ZEV credit was designed to get big automakers onto the EV train, and it worked. It’s arguably unfair to Tesla, which only sells EVs without any internal-combustion models to fall back on, and was selling EVs before ZEV credits even existed.

So is GM putting out a piece of crap, which no one would want to buy, just to be able to sell Silverados in California? Not according to Car and Driver, which gives it five stars out of five:

Quick on its feet and fun to drive, the Bolt EV gives Tesla a run for its money. A floor-mounted battery powers a 200-hp electric motor; in our testing, we recorded 96 MPGe and a 75-mph highway range of 190 miles. It rides well over rough roads and acceleration is great, launching the car to 60 mph in 6.5 seconds…

Here’s proof that the electric car isn’t going away: General Motors, that 108-year-old monolithic automaker, now sells a battery-electric hatchback that delivers more than 200 miles of driving range and can be had for less than the price of the average new car.

In my considerable experience with EV advocacy since 2005, detractors have been exclusively limited to people who don’t own one. Do you?

Jarmo Mikkonen's picture
Jarmo Mikkonen on May 7, 2018

Bob,

I drive a flexifuel car and fill it up with RE85 except in winter.

I have nothing against electric cars per se, I would buy one if I had the money. Which takes me to the economic point: government incentives for cars like Tesla Model S are basically subsidies for the rich. People would scream murder if subsidies were offered to Porsche buyers.

I have no doubt that Bolt is a good car. That piece of crap thing came from you. I just say it’s about money…. considering that California has ZEV credits and Chevy sells 60% of Bolts in California, the rest mostly in other ZEV states, I would say that earning those credits is a major issue for GM.

Considering electricity generation emissions, how much more emissions EVs create when built and, above all, the cost, I do not think they are an efficient solution for cutting emissions today in the US. Maybe later.

Schalk Cloete's picture
Schalk Cloete on May 7, 2018

As clearly stated in the article, the argument behind the high importance of CCS is the extremely rapid CO2 reductions into deeply negative territory that will be required to meet climate targets. No other supply-side technology is better suited to this particular task than CCS.

If the world could implement strong technology-neutral policies tomorrow, directing the full force of the free market towards sustainable development, the role for CCS would be much smaller. Unfortunately, the more likely outcome is a continuation with current technology-forcing policies, creating a lot of hype, but very limited CO2 reductions. The longer this drags on, the more dependent we become on CCS. Trust me, I don´t like this any more than you do, but this is the reality we face today.

For perspective, our entire 2 deg C carbon budget will be consumed around 2035, implying that any emissions after that time will need to again be extracted from the atmosphere. The “beyond 2 deg C” budget from the Paris agreement will be consumed in 5 years.

Schalk Cloete's picture
Schalk Cloete on May 8, 2018

Tesla is certainly a fascinating case. It has consistently lost about $15000 per car, although a sustainable premium automaker should be making $15000 per car. The wide range of subsidies and incentives driving electric car sales in all Tesla´s markets sum to about $20000 per car. Thus, Tesla remains about $50000 per car away from being a sustainable company, but the share price remains at stratospheric levels.

This valuation is of course completely tied to the future. Since Model S and X sales have now plateaued, everything rides on the Model 3. The key unknown is whether Tesla can profitably produce the $35000 “mass market” version. We will see in about 1 year´s time…

BEVs are great in the luxury/performance segment and also make sense as second cars used primarily for commuting, so the potential market size is large. As a primary sustainability solution, however, electric cars fall far behind the much less hyped options discussed in this article.

Bob Meinetz's picture
Bob Meinetz on May 8, 2018

Schalk, I agree with Mark. We won’t know if CCS is suited to any particular task until we have evidence it’s practical, at the scale which would be necessary. At this moment there’s none.

I trust you, but it’s not an issue of trust. For me you haven’t made the case that CCS isn’t itself a lot of hype, that it isn’t actually making things worse by justifying more extraction, that it can be verified, that it’s remotely economical.

In my opinion we will blow past 2ºC if we can’t stop extraction, and the only feasible way to do that is by electrifying every possible application of energy, and undertaking a massive buildout of nuclear to generate that electricity.

Until someone is able to convince me I’m wrong, that’s the reality I face today.

Bas Gresnigt's picture
Bas Gresnigt on May 8, 2018

The German technology forcing of wind & solar, originally targeted to make wind & solar cheaper than nuclear by creating mass production.

As that policy was successful (e.g. solar decreased from $1/KWh toward 5cent/KWh in Germany) the policy is continued, now targeting much cheaper production than fossil.
Because together with the PtG storage developments, it offers the opportunity to whip all fossil off the energy market.

A technology neutral policy won’t reach that in such a short period.

Willem Post's picture
Willem Post on May 8, 2018

Schalk,

The single most damaging to the environment and flora and fauna has been the world’s human population explosion since 1800, when there were “ONLY” 1 billion people.

About 15000 – 12000 years BP, most of northern Asia, northern Europe, northern America, etc., were still covered with about one MILE of ice. Almost all of the world’s population (about 1 to 3 million) lived in small groups, mostly in hunter-gathering mode, with some agriculture, in areas of southern France, Spain, Italy, Turkey, the Caucasus, the Middle East, northern Africa, Iraq, Iran, southern India and Asia. North of those areas, with few trees, much frozen tundra and ice, there lived very few people.

By about 5000 years BP, much of the ice had melted, and the world population had increased to about 10 to 15 million people. The big question remains: Why is the temperature lingering for 11,200 years, unlike the prior cycles? Why are we not yet into another ice age?
https://en.wikipedia.org/wiki/World_population_estimates

Mark Heslep's picture
Mark Heslep on May 8, 2018

Rapid decrease in CO2 is required, agreed. It does nor follow that CCS can accomplish the goal. A feasible CCS system has to be on the same scale of the existing multi $trillion global fossil industry: every carbon atom removed from the ground must go back in the ground, in a form more difficult to store.

There is no proven CCS track record for low carbon grids. There is for nuclear.

Helmut Frik's picture
Helmut Frik on May 8, 2018

Two points generally missing in the articla:

1) Density, in Cities and other places for dwelling. Density makes it easy to reach everything you need by walking. it is achieved by according building standards, and by a working public transport – car transport can not support dense cities, it’s geometrically impossible. Dense cities usually reach a higher level of economy, due to less costs of ways, more customers in reach, more suppliers in reach, more competition etc.
2) public transport. E electric train with 1000 or 2000 passengers is difficult to beat as far as energy and ressource consumption are concerned.

Beside this I do not see any integration problems for wind and solar in the near future. Germany has 42% renewables share in the grid this year so far, the same number for spain is 47%. Spain has 25% wind share, and is almost a island grid. And sitll has no feelable integration problem.
So any real integration problem should not be expected below 50% renewables share in all grids, and can most likely be solved with grid expansions, and being eased with dynamic loads.

Bob Meinetz's picture
Bob Meinetz on May 8, 2018

Lots of options, Rick. Check this out:

https://www.eurobike.at/en/cycling-holidays/tour-type/ebike-tours

Cyclist Bas would probably have some suggestions.

Bob Meinetz's picture
Bob Meinetz on May 8, 2018

Jarmo, before tax and license my Nissan Leaf cost $22,400, including government incentives totalling $10K. In 2011 the car would not have been affordable for me without them.

Tesla’s Roadster, the company’s first offering, was a tiny two-seater that listed for $95K. Toy for the rich? No doubt, but somehow Elon Musk was able to get a company whose only product was a car powered by 6,000 cellphone batteries off the ground. He admitted early on his marketing strategy was to use sales of great-looking luxury cars to ultimately finance an affordable EV for everyone, and if you think he has problems now with the Model 3, watch Chris Paine’s 2011 followup to Who Killed the Electric Car? , “Revenge of the Electric Car” – he eats manufacturing challenges for lunch.

Right now my Leaf saves no emissions over a comparable IC car. None. I’ve described here how I caught the city of Burbank, CA failing to account for the fact 33% of its electricity comes from a coal plant in Utah – a city which has been erecting public charging stations for EVs at great expense. In 2018, the money would have been better spent subsidizing gas stations. But in 2025, when Burbank has grown weary of me and others nagging them and found cleaner sources of electricity, they’ll have cleaned up the emissions of all their EV drivers in one fell swoop – a public solution to a public problem. That, in a nutshell, is the only way we’ll be successful at addressing climate change.

Jarmo Mikkonen's picture
Jarmo Mikkonen on May 8, 2018

I checked and over here, a new Nissan Leaf costs 34 000 euros with taxes and incentives. The cheapest base model. That’s around 40 000 dollars.

But I think Finland is doing OK without electric cars. Finnish electricity will be 90% carbon free by 2020. That is important because our electricity consumption per capita is among the highest in Europe.

40% of our final energy consumption is renewable today. It rose 10 % in less than 10 years. Add to that the share of nuclear which will be over 20 % in 2020 and things are looking pretty good to me.

Roger Arnold's picture
Roger Arnold on May 8, 2018

It’s refreshing to see an article with so much well distilled and well presented common sense. I don’t think there was a single point with which I’d take issue. Perhaps a few I’d want to say more about, but that’s true of any article.

A caveat about virtual mobility and telecommuting. I don’t think living one’s life at home in front of a computer screen qualifies as a healthy lifestyle. I know that’s not what you were advocating, but it’s what a lot of “work from home” telecommuting seems to reduce to. It’s seductive to be able to do that, and rely on e-mail, chats, and tweeting to make us feel like we’re connected social beings. For many of us, that’s far easier and more comfortable than putting up with the aggravation and tension of dealing face to face with real people, in all their complexity. But “comfortable” is not the same as “healthy”. We need to be jogged by interactions with others, even if they’re sometimes uncomfortable. Otherwise we tend to stagnate.

What I tend to favor over telecommuting from home is the notion of distributed offices; places within easy walking or biking distance of one’s residence, where one goes to relax, enjoy coffee and a bit of socializing, and work. High bandwidth communication links to one’s co-workers in other locations, on-site managers, HR personnel, and training staff whose services are shared among businesses having workers at that location.

That’s actually a fair description of some of the startup incubators here in Silicon Valley. They’re partly what accounts for so much innovation that bubbles up around here. But the model needs to be extended to larger organizations and social ventures, not just business startups.

Engineer- Poet's picture
Engineer- Poet on May 8, 2018

Beat this drum until the drumhead breaks:

Right now my Leaf saves no emissions over a comparable IC car…. But in 2025, when Burbank has grown weary of me and others nagging them and found cleaner sources of electricity, they’ll have cleaned up the emissions of all their EV drivers in one fell swoop – a public solution to a public problem.

That is one of the points I hope people keep making.  An ICEV gets dirtier over time, as its engine gets less efficient due to wear and its catalyst systems become less effective.  However, a PEV can become as clean as its energy supply.  It is the ONLY vehicle which is likely to have emissions reductions long after it goes on the road.

Bob, after reflection it shocks me that both California and Arizona literally throw zero-emission power away during PV generation peaks rather than finding ways to displace fossil fuels with it.  What is obvious to me must not be obvious to too many others.  Perhaps I should be filing for another patent.

Schalk Cloete's picture
Schalk Cloete on May 9, 2018

Just to be clear, I’m not saying that more fossil fuels should be extracted because of the promise of CCS. I’m saying that a lot more fossil fuels than the 2 deg C budget will be extracted (because of the economic growth demands of billions of people) and CCS is the best way to address the resulting problem.

You are probably thinking of the example of France to argue that nuclear can also grow an economy, but, aside from the high up-front cost issue I always raise, economic development is about so much more than just electricity. You need a lot of steel, cement and other industrial products as building blocks, and a lot of practical energy dense fuels to assemble these building blocks into a functional economy. Given the suitability of fossil fuels to all aspects of economic development, I’m afraid the “leave it in the ground” idea simply is not going to happen.

Schalk Cloete's picture
Schalk Cloete on May 9, 2018

About CCS being hype, there are a number of large-scale CCS projects running and more under construction: https://www.globalccsinstitute.com/projects/large-scale-ccs-projects. Naturally, most projects are focusing on low-hanging fruit, combining CO2 capture from relatively concentrated industrial streams with enhanced oil recovery, but there are a couple of projects with capture from power plants and a couple with geological storage. The technology works.

CO2 transport and storage is based on technology that has been perfected by the oil & gas industry over many decades. There are no techno-economic showstoppers here and scale-up can be extremely fast, although we should expect some constraints on deployment from NIMBY. CO2 flow will be measured and audited both at the point where it is fed into the network and at the point where it is injected into the storage site. Naturally, there will be a lot of scrutiny to make sure that the CO2 stays in the ground.

Capture is typically the most expensive part of CCS. For power plants, CCS with geological storage using first generation, commercially available technology will increase LCOE by about 50% for gas and 75% for coal, while EOR reduces the cost increase to about 25% for both fuels. https://www.sciencedirect.com/science/article/pii/S1750583615001814. This cost increase is substantial, but not unaffordable to an economy already built through unabated fossil fuel combustion.

Second and third generation CO2 capture technologies can cut this cost substantially, primarily by reducing the energy penalty of CO2 capture. Some technologies such as membrane assisted chemical looping reforming and the Allam CO2 cycle claim complete CO2 capture without any cost penalty relative to an unabated benchmark. This sounds a bit optimistic to me, but it will be great if they can even come close to this claim. Power cycles using fuel cells can also achieve ridiculous-sounding 70% efficiencies with 100% CO2 capture. Overall, I think it is reasonable to expect that technologically mature CCS will be able to avoid CO2 (geological storage) at a cost about 20% greater than unabated combustion.

Schalk Cloete's picture
Schalk Cloete on May 9, 2018

I agree that technology-neutral policies are much more difficult to implement than technology-forcing. But I do not agree that, once established, technology-neutrality would require a longer time with the same budget.

Again, the very low capacity utilization scenario of wind/solar overbuilds backed up by PtG plants with large gas storage and transport infrastructure may be feasible when the discount rate is close to zero, but it makes no economic sense at developing world discount rates of 10% and more. The developing world represents 90% of the global 21st century sustainability challenge.

Schalk Cloete's picture
Schalk Cloete on May 9, 2018

Thanks Roger.

I agree about the potential for social isolation with telecommuting. Although I hope that a car-free neighborhood inhabited by telecommuters will be such a nice place to live (e.g. areas currently dedicated to roads and parking can be re-purposed as parks or sport facilities) that even the most dedicated computer addicts cannot resist going outside on a regular basis. It is also possible that telecommunications technology advances to the point that dealing with people through VR becomes pretty similar to dealing with them face-to-face.

Yes, I think your distributed office idea could have an important place in a telecommuting future, especially if a sufficiently high level of VR proves not to be achievable with affordable equipment installed at home.

Schalk Cloete's picture
Schalk Cloete on May 9, 2018

I agree about the economic efficiency of cities and public transport.

About integration of wind & solar, it is important to point out that a 15% global electricity share implies most wind & solar will be in economies with substantially higher shares. For example, if half the world commits to wind & solar and the other half does not, a 15% global average wind & solar share is actually a 30% share in the countries that embraced wind & solar.

Germany will be interesting to watch over the next couple of years. Redispatch costs are now rising to concerning levels and instances with negative power prices keep rising as well. It is also important to note that the German wind & solar share is only about 17% when accounting for all electricity generation and the way that Germany employs the dispatchable generation of its neighbors to balance its wind & solar.

Engineer- Poet's picture
Engineer- Poet on May 9, 2018

I’m saying that a lot more fossil fuels than the 2 deg C budget will be extracted (because of the economic growth demands of billions of people) and CCS is the best way to address the resulting problem.

That would be true if technology was the only barrier.  Sadly, it’s not.  The biggest issue is human factors.  Denial is the biggest one in the west, but across huge parts of the world this is dwarfed by the twin hazards of corruption and incompetence.

The best-designed and built CCS system is useless if nobody maintains it, or if someone can pocket the maintenance and operations budget, open the valves and dump to the atmosphere.  Things like this happen across the third world, because they are low-trust societies where people in authority are expected to be out for themselves and their families alone and nobody has the power and incentive to bring them to heel; those who might are busy feathering their own nests, not picking fights with other families.  In such conditions you might as well not bother.

ThorCon is working toward the only thing which can do the job under such conditions:  non-emitting power which is cheaper than coal, so there aren’t any corners to cut, budgets to steal or valves to open and walk away whistling from.  I wish them luck, because if they fail there are no alternatives that aren’t extremely ugly.

You are probably thinking of the example of France to argue that nuclear can also grow an economy

It certainly can, and if ThorCon or NuScale succeed they’ll address the issue of lots of interest on capital costs before revenue starts coming in.  ThorCon appears to have the biggest potential for this.

aside from the high up-front cost issue I always raise, economic development is about so much more than just electricity. You need a lot of steel, cement and other industrial products as building blocks

Nuclear has the virtue of using only a fraction of the material inputs of wind and PV, and the minuscule amount of fuel required probably minimizes its upstream demands in mining etc. as well.

This requires a new generation of designs.  Neither VVERs nor APR-1400 are fast enough to build.

Bob Meinetz's picture
Bob Meinetz on May 10, 2018

Schalk, you present a very elegant and complete argument on behalf of CCS, and I have to admit the bulk of my objection to the idea is rooted in skepticism.

Over the last 40 years, I’ve become aware of countless business proposals which disappear into the night. Usually, it’s because they aren’t instantly profitable. Sometimes, they can’t easily be understood by investors or advocates; or are profitable for reasons other than their stated ones. Sometimes they’re identified too late as outright swindles, deliberately facilitated by complicated business models or technologies which are difficult for laypeople to understand.

CCS looks to me like a little of each, mostly because of the loss of faith in human nature I had when I was your age. I hope I’m wrong – that energy entrepreneurs in coming decades will accept the responsibility to leave a habitable world for their descendants, and do what they’re supposed to do. I just don’t have much personal experience with things working out that way.

Sean OM's picture
Sean OM on May 10, 2018

I think california will end up throwing a lot less away by the end of the year. utilities have to install something like 385mwh of storage by the end of the year as part of their 1.3gw of installed storage goal.

Arizona is looking at storage also, and APUC killed a planned NG facility too. Arizona is one of those unlikely allies, as they are a red state, but the alternatives can save -lots- of water which they already fight over, but it is worse with a drought going on.

Sean OM's picture
Sean OM on May 10, 2018

First, GM was shipping Bolt battery packs from S. Korea. LG is in the middle of an expansion to their holland, michigan facility to make them more locally. The capacity in the S.Korea plant is small.

Second, GM had to demonstrate the product was viable. They go through and evaluate the next quarters parts orders. based on prior sales. The first 6 months it looked like it would barely nudge the minimum 15k they needed to keep the line up. But battery supplies are constrained at 30k, so you don’t want advertise and end up overselling.

Last, I wouldn’t exactly take Elon’s word for what GM does. Elon can’t figure out how to design a car to be mass produced. They have made changes to the car since they started producing it, and still can’t even get close to their target production goals for the battery packs much less the vehicles themselves. So their timelines and cost estimates are =way= off. And they are reporting huge losses because Elon can’t figure out how to fix the problems, and he doesn’t have the money to throw at the projects.

Sean OM's picture
Sean OM on May 10, 2018

You aren’t wrong. How much methane is leaking from fracking that the oil and gas companies with decades of experience “forget”?

It is better just not to create the problem for future generations to take care of. We are seeing that with Nuclear and coal the US has trillions of dollars in clean up costs that have been passed on to future generations.

You can do a carbon tax to cover the cost of CCS, but policies can easily be overturned. Just look at how much Trump is trying to overturn. He -would- have dumped RE completely but it employs 800k people in the US now, and it is cheaper. It makes it -really- hard to do.

In the US we can get really close with wind/solar/storage. The trick is to make it cost effective. If it is as cost effective as FF technology, then it will be lights out for FFs. The laggard is really battery technology but there is potential within 10 years it will improve enough to be competitive.

Bob Meinetz's picture
Bob Meinetz on May 10, 2018

Elon can’t figure out how to design a car to be mass produced. They have made changes to the car since they started producing it, and still can’t even get close to their target production goals for the battery packs much less the vehicles themselves.

Tesla Model S Sedan:

Motor Trend 2013 Car of the Year
2015 Car and Driver Car of the Century
Perfect 5.0 NHTSA automobile safety rating
Highest range of any electric car (Model 100D)
Fastest acceleration of any production car (Model P100D 0-60, 2.5s)
First electric car to top the monthly new car sales ranking in any country
Top selling plug-in electric car in the world (2015-2016)

Sean, Musk isn’t interested in figuring out how to design yesterday’s cars to be mass produced. He’s too busy designing tomorrow’s cars while leaving everyone else in his wake.

Jarmo Mikkonen's picture
Jarmo Mikkonen on May 10, 2018

Sean,

Elon also can’t make profit but I think he knows something about the economic side here.

There’s two uncomfortable facts to contend with here:

1. No EV manufacturer makes a profit with EVs. Tesla’s cumulative net losses amount to 5 billion dollars since 2010. That’s a 25 000 dollar loss per vehicle manufactured to date.

2. Sales of EVs in the US are still driven by federal tax credit for EVs and state tax credits which can cut over 10 000 dollars of the cost.

3. Sales of EVs in every country are driven by incentives. Witness success in Norway and the crash of EV sales in Denmark when incentives were cut.

Federal tax credit is running out on Tesla and GM because they are getting close to the 200 000 vehicles limit.

Compare EV sales with a profitable tech, hybrids. Toyota has cranked out 12 million hybrid cars. They sold 1.5 million in 2017.

Helmut Frik's picture
Helmut Frik on May 10, 2018

Wind and solar power production in 2017 was 142 TWh, if your 17% were true, germany would have produced 835TWh of electricity in 2017, and in 2018 the number would be significant higher.
I think brutto production was significant lower, and netto production, which is the relevant number if anything concerning the grid is in discussion was even smaller.
(power which never reaches the grid, and which will never have to be replaced by renewable production, because it is immediately consumed again by the conventional power station after it was produced, which does not happen in renewable generation where only netto production is counted)
So I am afraid you have to adjust your numbers.

Schalk Cloete's picture
Schalk Cloete on May 11, 2018

Thanks Bob.

In the end, CCS is just good old chemical engineering – something the world is pretty good at. If a meaningful CO2 price emerges, a significant portion of this global expertise will respond to this price signal by switching from taking stuff out of the ground and upgrading it to separating out stuff and putting it back in the ground. This can be a very natural shift because many of the principles are directly transferable.

The problem is of course that very little will happen before a meaningful CO2 price is put in place. This is where human nature poses a problem in my opinion. People naturally delay taking the necessary action until the very last second and I doubt that climate change will be much different.

At least history has shown that we are pretty good at making things work when the crisis is right in front of us and we have no choice other than to deal with it. CCS is ideally suited to such a scenario where climate change has progressed to the point where we are forced to rapidly deal with it regardless of the cost.

Such a scenario is very far from the most efficient, but it is unfortunately the most likely in my opinion. These articles are just a feeble attempt to reduce this likelihood (and the associated need for massive CCS deployment).

Bruce Menzies's picture
Bruce Menzies on May 11, 2018

Shalk

You comment “The problem is of course that very little will happen before a meaningful CO2 price is put in place.”

We at Predict Ability Ltd (PAL) believe we have a ‘meaningful’ CO2 price that is ‘in place’. We have established a CO2 price that we claim is ‘meaningful’ in the sense that it is based on the dollar cost of loss and damage caused by extreme weather-related events attributable to manmade climate change triggered by burning fossil fuels. We also claim it is ‘in place’ in the sense we use our carbon price for carbon auditing of big ticket projects, and for assessing carbon liability for Value at Risk (VaR).

We argue the case for the above in our book ‘Predicting The Price Of Carbon: how to crack the climate change code for good’ by my colleague Richard H. Clarke. We illustrate our application of the carbon price in Supplement 1 to the book ‘Hinkley Point C Nuclear Power Station Enhanced Carbon Audit LCA Case Study’. In Supplement 1, we compare nuclear, gas and wind lifetime equivalents. For gas the cost of carbon alone equals the entire cost of nuclear.

Helmut Frik's picture
Helmut Frik on May 11, 2018

This does not take into account the crucial point which killed CCS in germany: how should coal power with CCS be competitive on the market, when Coal power without CCS is not competitive, even without significant CO2 prices.
It would mean that the CCS equipment comes at a negative price, which is extremely unlikely.
So CCS is dead as long as fossil fuel powered plants are not competitive in the market in question. (I see here new plants, existing plants might finance their survival without paying back their construction costs in the market in question)

Mark Heslep's picture
Mark Heslep on May 11, 2018

You are probably thinking of the example of France to argue that nuclear can also grow an economy, but, aside from the high up-front cost issue I always raise, economic development is about so much more than just electricity. You need a lot of steel, cement and other industrial products as building blocks, and a lot of practical energy dense fuels to assemble these building blocks into a functional …

It is not clear to me that the demands of steel and cement and other building blocks for a coal industry (and the like of daily 100 car coal trains) is in less than the demands for a nuclear plant, per unit of energy produced.

Engineer- Poet's picture
Engineer- Poet on May 11, 2018

Compare EV sales with a profitable tech, hybrids. Toyota has cranked out 12 million hybrid cars. They sold 1.5 million in 2017.

That is an excellent point, and the reason why I think the path forward is evolutionary (PHEV), not so much revolutionary.

LDV sales in the USA ran to just over 17 million vehicles last year.  If they were all PHEVs with an average of 10 kWh of battery (more for bigger vehicles, of course) that would require 170 GWh of batteries per year.  If a Gigafactory can turn out 50 GWh of packs per year, it would take just 3.4 such factories to PHEV-ize the ENTIRE annual LDV sales of the US.  This is well within reach.

Once every drivetrain was electric-dominant, a host of other effects would come into play:

1.  Elimination of idling and low-throttle operation cuts fuel consumption 30% right off the bat.
2.  Parasitic engine drag disappears as power steering and A/C go electric.
3.  Engines downsize as electric supercharging replaces displacement.  Performance is unchanged or improved.  Weight, efficiency and possibly cost all improve.
4.  Rapid improvements in power electronics follow.  Silicon carbide semiconductors in particular are favored by the capacity for high-temperature operation and the advantage of air-cooling over dedicated liquid cooling loops.  Building tens of millions of high-power inverters per year runs down the experience curve VERY fast, with knock-on effects elsewhere as the technology spreads beyond automotive.
5.  Drivetrains improve.  Rear axles with individual motors for each wheel eliminate driveshafts and differentials and allow traction control and torque vectoring in software.  Voila, sports-car handling from the AWD in your minivan.

Once the public was used to all of these features, I doubt they’d go back to mere hybrids.

Bob Meinetz's picture
Bob Meinetz on May 11, 2018

For other interested readers, Bruce’s book Predicting The Price Of Carbon: how to crack the climate change code for good (Supplement 1) is available in e-book format here for the astonishingly low price of $1.

Sean OM's picture
Sean OM on May 11, 2018

Sean, Musk isn’t interested in figuring out how to design yesterday’s cars to be mass produced. He’s too busy designing tomorrow’s cars while leaving everyone else in his wake.

He is interested in designing “tomorrow’s cars” but his problem is you have to be able to design them to be assembled on the assembly line and at a specific price point. The vision is =easy=. The execution is the hard part. It gets exponentially harder the more you try to produce. GM produced over 10M cars last year, behind VW and Toyota, Tesla produced just over 100k.

My point is, it is hard to project costs, and profitability for another company’s product if you don’t understand the basic process they use especially in relation to keeping costs under control.

Sean OM's picture
Sean OM on May 11, 2018

I agree elon, and everyone else understands the economics.

Most manufacturers are “losing money” because of R&D costs, and higher component costs. Toyota has been making the Prius since 1997 which they are on their 4th generation. The initial R&D costs are already amortized and they have the component cost volume up which lowers the price. This is what Elon sees as the opportunity for Tesla. They started with a clean slate, if they bounce over the fixed overhead cost (ie cost and interest for factories, and equipment), R&D costs, and drive costs down by volume, they made it. However, keeping Elon on this page is trickier. He sees a LOT of opportunities and they actually exist, but spreading too thin can cause issues.

Tax credits are designed to create the volume necessary to drive down component costs and spread R&D costs over more vehicles. In the US, those costs are figured as the avoided economic cost of importing oil for the lifetime of the vehicle.

Hybrids, which -should- be the profitable group and a natural progression because they avoid a lot of battery costs which is the main component that drives up the price of EVs. Most people in the US don’t drive over 50 miles a day so a PHEV is just as electric as EVs for a lot of people, and those 10 times a year they need the extra range, it is there so it is like an 80-90% reduction in gas use, rather then 100% but it is close enough.

Hybrids are really caught in between a holy war. You have the pure gas folks saying “stay away from electrics. They are junk” and you have the pure BEV folks saying crap like “they are an interim solution. Electrics are the future!” Neither one is a selling point for hybrids, so they are getting shot down by both sides when in fact hybrid technology can get us pretty close to where we need to be and a lot faster without as much new infrastructure overhead.

Waiting for Battery prices to fall into the competitive with ICE range, is kind of like waiting for Fusion except batteries have a lot better chance. In order to get to a pure BEV fleet, you have to have a solid electric grid and charging infrastructure which in itself is at least a 10-20 year process at least in the US, but we started the grid back in 2005.

Schalk Cloete's picture
Schalk Cloete on May 11, 2018

I was not referring to the construction of energy infrastructure, but to the construction of everything else (the economy as a whole). The point is simply that the share of electricity in the final energy consumption of an industrializing economy is rather small (below the ~22% global average). Various fuels for industry, transport and heating/cooking play the dominant role.

Mark Heslep's picture
Mark Heslep on May 11, 2018

Schalk, thank you for the references.

Yes, CC has been around for decades as you indicate, for EOR. All of the fossil carbon capture and storage in the US, no exceptions, are EOR and enable the production of yet more carbon in the atmosphere.

With regard to the assertion that that “scale-up can be extremely fast”, see Smil in Nature here and here.

2008:

…Carbon sequestration is irresponsibly portrayed as an imminently useful large-scale option for solving the challenge. But to sequester just 25% of CO2 emitted in 2005 by large stationary sources of the gas (9.6 Gm3 at the supercritical density of 0.468 g cm−3), we would have to create a system whose annual throughput (by volume) would be slightly more than twice that of the world’s crude-oil industry, an undertaking that would take many decades to accomplish.

2011:

…Let us assume that we commit initially to sequestering just 20 percent of all CO2 emitted from fossil fuel combustion in 2010, or about a third of all releases from large stationary sources. After compressing the gas to a density similar to that of crude oil (800 kilograms per cubic meter) it would occupy about 8 billion cubic meters—meanwhile, global crude oil extraction in 2010 amounted to about 4 billion tonnes or (with average density of 850 kilograms per cubic meter) roughly 4.7 billion cubic meters. This means that in order to sequester just a fifth of current CO2 emissions we would have to create an entirely new worldwide absorption-gathering compression-transportation- storage industry whose annual throughput would have to be about 70 percent larger than the annual volume now handled by the global crude oil industry whose immense infrastructure of wells, pipelines, compressor stations and storages took generations to build. …

Roger Arnold's picture
Roger Arnold on May 11, 2018

Talking about Tesla’s cumulative net losses and saying that no EV manufacturer makes profits with EVs is misleading. The actual situation is more complex.

Tesla does, in fact, make a rather handsome profit on every vehicle it sells — when profit is figured as the difference between sales price and marginal cost of production. Tesla has had and continues to have a large negative cash flow — it’s “losing money” — but there’s a good reason. It’s been ramping capacity aggressively.

Ramping is always problematic for any new manufactured product. There’s a time lag between expenditures for new equipment and facilities and revenues from the products that the new equipment and facilities will be making. Bridge loans to cover that lag are a big part of what the finance industry is about.

It’s always touchy. Borrow heavily to support aggressive expansion, and any glitch in execution can trigger bankruptcy. Borrow lightly to support a conservative expansion plan, and risk losing your market.

Musk generally goes for aggressive expansion. Glitches in ramping Model 3 production have created headaches and brought the company close to bankruptcy. But only close. Now the problems appear to be under control, production rates and sales revenues starting to close on targets. In the meantime, expenditures for new equipment and facilities have begun to taper off. That’s why Musk is confident that the company will not need to sell new stock or borrow more money this year. IIRC, he expects net cash flow to turn positive by December.

Mark Heslep's picture
Mark Heslep on May 11, 2018

Vehicle manufacturers must eventually cover more than the “marginal cost of [vehicle] production” with sales. They all have plant infrastructure, tool and die costs. They all have development costs for future vehicles. Traditional manufacturers cover these costs out of vehicle sales. Tesla so far does not.

Tesla’s production problems with the 3 are not accurately described as “glitches”. Gross over-automation of the assembly process, admitted by Musk, is a mistake for the lab, pilot projects, or perhaps one piece of new high volume line until proven, never the whole factory. High volume manufacturing can’t tolerate those kinds of missteps due to the capital involved and the cost of that capital. Consequently high volume production should be run not by visionaries but by those with long experience in the process, and the manufacturing process itself changes in increments.

Bob Meinetz's picture
Bob Meinetz on May 11, 2018

Sean, in 1996 GM, a company with $billions in assets which had been in business for a century, designed the EV1, the first electric car from a major U.S. automaker. After an evaluation period when leases were offered to potential buyers. It sold exactly zero units – a total flop.

Fast forward to 2005, when GM is sitting on their ass making the same crappy cars they’ve made for decades. Their CEO, Bob Lutz, has just famously announced to the world “hybrids don’t make any sense”, when along comes Musk with a paltry $100 million. Because large-format Li-Ion batteries didn’t exist, he wires together 6,800 cellphone batteries and invents an li-ion Battery Management System to charge them (those didn’t exist either). From these one-of-a-kind pieces he creates a one-of-a-kind car – the Tesla Roadster – that becomes the first U.S. production EV available for sale to the public in over one hundred years. Within a year, it sets both the world EV distance and speed records, and leaves GM in the dust.

If you haven’t been following Spacex, Musk launched another satellite into space today, then landed its booster on a raft floating at sea. This is what engineering genius looks like.

So by any standard Musk is a visionary, and making money at selling brand new, innovative products is never easy. Henry Ford didn’t come out of the womb knowing how to make money building and selling cars.

Mark Heslep's picture
Mark Heslep on May 12, 2018

Fine analysis. Couple of caveats:

o The EV-ICE dual power plant improvements detailed in 1-5 above will be under economic pressure to come through at cost lower than ICE alone by the provider looking for sales advantage with a lower priced ICE vehicle of the same model. Lifecycle cost may be a win for the PHEV, but sticker price always dominates in auto sales.

o Bump the annual battery GWh production 10% to cover battery replacement at ~10 years. Eight?

o 6. The rather severe cold weather problems with battery warmup and cabin heat limiting sales for BEVs in cold climates vanish with the PHEV.

Engineer- Poet's picture
Engineer- Poet on May 13, 2018

o The EV-ICE dual power plant improvements detailed in 1-5 above will be under economic pressure to come through at cost lower than ICE alone

I suspect that this can be achieved, because the engine of the electric-dominant PHEV can have characteristics which make it cheaper but won’t work in a pure ICEV.  For instance, an engine which derives much of its power and its scavenging from a turbocharger with energy recovery, and thus can’t idle with acceptable fuel consumption (much like a Hyperbar engine).  The piston portion could be piston-ported (no poppet valves, valve springs, rockers, cam followers, camshaft or cam belt/chain) for a radical reduction in parts count and assembly cost, and the turbo is one moving part.  You can tolerate massive engine torque pulsations and unstable combustion if you have electric systems to offset the NVH.  All you’re really going to care about is thermal efficiency and emissions.

The big issue with this is that it would be an entirely new engine, and PHEVs are currently much too small a fraction of the market to amortize the cost of designing it and building a plant to make it.  But when almost everything is PHEV?  That makes such things a no-brainer.

The rather severe cold weather problems with battery warmup and cabin heat limiting sales for BEVs in cold climates vanish with the PHEV.

To be honest, my car barely gets warm on many of my short trips, so I don’t bother turning on the main heat (which starts the engine) even in winter unless I’m going some distance.  I use the electric seats and crack windows to prevent window fogging.

Jarmo Mikkonen's picture
Jarmo Mikkonen on May 14, 2018

That’s why Musk is confident that the company will not need to sell new stock or borrow more money this year. IIRC, he expects net cash flow to turn positive by December.

Tesla already borrowed half a billion this year:

Tesla Raises $546 Million in Its First Asset-Backed Securities Deal
https://www.wsj.com/articles/tesla-raises-546-million-in-its-first-asset-backed-securities-deal-1517512824

douglas card's picture
douglas card on May 17, 2018

conclusion: 150K model 3’s this year, 1,000,000 total Tesla EV’s produced in 2020.

No environmentalist would suggest EV’s over a bicycle. Why are we trying to suggest otherwise?

douglas card's picture
douglas card on May 17, 2018

Exactly! Nothing you posted can be disputed with actual facts