The studies were all quite well done and very informative.  The top line result is this; in order to achieve 20% wind power by the year 2030 we will need to create 280,000 megawatts of new wind power.  If the projected average size machine is 2.6 megawatts, then that means 108,000 horizontal wind turbines will be needed over a ten year period.  That’s a lot of turbines.  And good news for GE and Siemens.  Maybe not so good for US workers if the majority of the turbine content is sourced outside the US.

At today’s cost for land based wind power, $2.47 million/megawatt, it will cost  $691.6 BILLION dollars over a ten year period.  And if wind turbines actually produced their rated power, that might be OK.  But the fact is they do not.  The industry average is in the 22-28% range of productivity, with some hope of achieving 35% due to forecast improvements in the technology.  The utility factor takes into account the number of hours per year of wind blowing, down time losses, parasitic losses, etc.  The utility factor is also impacted by the poor system efficiency at anything other than the ideal wind speed.

If the electronics industry ran at this level they would have shut down years ago.   In response to this, the wind industry is moving offshore.  Why? Because offshore winds blow more frequently.  So the expectation is that by moving the wind turbines to the sea, the utilization factor will increase to 65%.  Great!

One small problem.  How do you make one of these things float?  Are they safe during a hurricane?   It’s like putting up a drilling platform, only harder because instead of drilling down, you have to go up with 20 tons of equipment suspended 250 feet above the platform.  The best estimates  for this feat of engineering put the cost at $5.94 million per megawatt.  Pushing the price tag for 20% wind power to $1.66 TRILLION.  And we haven’t begun to find out about the technical problems at sea compared to the problems we are discovering in land based wind power.

But here’s the scary part; you’ll never get to vote on it.  US energy policy is being implemented without Congress or legislative oversight.  The DOE has paid for a road map and by virtue of it’s $9 Billion per year budget, is spending that money and incentivizing businesses with matching grants.  R&D resources are being committed to achieve a goal that is, at best, very controversial.  We’ve had a lot of press, a lot of campaigning, but no real discussion and no real performance review.  But the DOE seems committed to the wind power roadmap, regardless of the cost or how long it takes.

Creating policy with your tax dollars.  With no input from you and me.  Now that’s scary!

Several companies, notably including Honeywell, are offering small wind packages.  These are systems with varying sizes of equipment that will generate electricity from wind.  Small wind can be defined as sized for operation of a single family home.  In the case of the Honeywell system it is designed to eliminate 18% of annual electrical power required.  With a target selling price around $4500 it will take a while for this unit to pay for itself.  And that is the difficult part about small wind.  There are many systems out there, from 2500 watts to 10,000 watts maximum output.  But the wind blows when it wants to, so it’s hard to tell what the payback will be for a small residential system.

A really “hot” topic is energy storage.  The demand for power does not follow the ability to produce power when wind or solar sources are being used.  So there has to be an intermediate storage capability to help the system manage the difference.  Anybody got a storage cell?

Well, as a matter of fact, A123 batteries who has been leading the lithium storage race, does have a storage cell.  They have a lot of them.  Some 2 Megawatt storage systems that fit inside a semi trailer.  Pretty impressive stuff.  They call it an APU, Auxilliary Power Unit.  Just like a diesel generator, only no smoke, no noise and no moving parts at all.  Pretty impressive.  And there’s more.

A123 has a technology migration path that they believe will create significant improvements over the currently available product.  The current wave of nanoscale processes applied to lithium battery chemistry will lead to decreasing costs and increasing energy density even further.  Both critical aspects of the business since competition for high energy density battery technology is coming from all over the world, including China and North Korea.  So if we want to hold onto this product technology and all the markets it applies to, we need to keep pushing the cost and performance envelope.

One interesting aspect of all this technology development is that we may see choices as consumers of power.  The current model of energy delivery being a highly centralized industry is going through a transformation of sorts.  This change may come quickly, and may have huge repercussions in our economy as the current group  of utility companies are forced to change their operating model.  What if everyone went off the grid?  What would the role of utility companies be? They might cease to exist, or become maintenance and operations experts keeping everything running.

What will the future of the power industry be?

The use of mechatronics principles should make new product/device design faster, easier, and deliver fabulous and inexpensive products. But many engineering groups grapple with this design approach. Why do some groups work while others struggle?

We’ve heard about the promise of mechatronics for many years. Off-the-record, we hear comments about the “problems with mechatronics.” Some engineering groups get it and apply it with great success. Others don’t even want to hear the term. But there is no denying that whatever you call it, this approach to design is necessary in today’s world of multifunction, multitasking equipment and systems.

You don’t have to refer to this approach as mechatronics. Said Kevin C. Craig, Ph.D., Professor of Mechanical Engineering, Marquette University, “I define mechatronics as multidisciplinary engineering system design.” This definition is much more descriptive.

A number of engineers and managers are looking into why this approach appears to either not deliver on its promises or why it only works for some. Their research so far indicates that there are three main problems: Education, corporate structure, and the lack of truly collaborative design tools.

Education should break down the walls, but …
Years ago, the wall between manufacturing and engineering had to come down before industry realized measureable improvements in productivity. A similar situation faces those who wish to implement mechatronics, only this time the walls that must come down are those between engineering disciplines.

Education has played a role in building those walls, partly in response to demands of last century’s corporations and labor unions who segregated engineering manpower into separate functions; mechanical, electrical, and others. Today, inertia maintains the status quo with many universities and colleges continuing to segregate engineering disciplines. Even the professors don’t collaborate with each other! The result is mono-functional engineers (a new term that you may hear more of soon).

This singular focus has created engineers who speak a different engineering language from each other. Noted John Pritchard, global product manager, Kinetix Motion Control, Rockwell Automation, “At a recent workshop with 50 engineers pulled from all areas of a company, the language discrepancies were clear. We were discussing how to take a mechatronic approach to robot design. In the conversation, the mechanical engineers spoke about their struggles with reverse dynamics. The control guys said their biggest challenge was Cartesian to joint transforms. This conversation went on for ten minutes before they realized they were talking about the same thing, just using different words. The control guys were thinking about math while the mechanical guys were thinking about links, angles, and so on. For this group, the solution was to speak mathematics.”

More collaborative software tools are coming that will move mechanical, electrical, and controls design information in both directions among the engineering groups.

A few educators are aware of this issue and are initiating a profound change, which we will go into shortly.

Another educationally based problem involves awareness; the decisions any engineer makes can affect other engineers’ choices for a design. “Lack of such awareness trips up many projects,” agreed Pritchard. “The choice of material is a fairly common decision that causes problems. For example, in the design of a reciprocating mechanism controlled by a servo system, a mechanical engineer may choose steel over aluminum. The steel may be more readily available, less expensive, standard practice, and so on. The control engineer, however, is now confronted by several constraints because of this choice. The servo motor must have three times the peak torque to accelerate at the same rate it would have needed had the mechanical engineer gone with aluminum. In addition, the design will need a bigger motor, bigger drive and circuit breaker, heavier wiring, bigger amp supply, bigger everything.

“The mechanical engineer may have no idea how the design of one part impacts the overall machine. A 10¢ per part saving may really result in up to $10,000 additional cost in order for the control engineer to deal with the larger inertia. And there are many choices like this; couplings, compliance, gearbos backlash, and so on,” continued Pritchard. “And the control engineers and the electrical engineers do the same thing; trapezoidal acceleration, for example, can excite resonances which can frustrate the mechanical engineers. Another example is the common practice of putting acceleration at 100% rather than a lower percentage, which can impact wear.”

Here’s an example of a mechanically oriented motion analyzer, the result of collaboration between Solidworks and Rockwell Automation.

“And control systems is one of the more important disciplines for mechanical and electrical engineers to have some knowledge of,” added Razvan Panaitescu, manager of Engineering for Mechatronics, Siemens. “It stands in between mechanical and electrical. You don’t need to know electronics deeply, just enough to model.”

A few professors have witnessed this lack of awareness and are developing programs that will not only solve it, but that will create shifts in the traditional engineering labor pool.

A change is coming
Ken Ryan, Director of the Center for Applied Mechatronics at Alexandria Technical College in Minn., spoke about what educational institutions can do to resolve these issues. He sees the engineering role shifting into two main categories: the specialist engineer (which is probably most of you) and the cross functional engineer.

The Specialist or mono-functional engineer is the traditional Mechanical Engineer (ME), Electrical Engineer (EE), Controls Engineer (CE) and so on. These individuals are experts in their chosen field. “Industry will always need these individuals,” said Ryan, “but not in the numbers that they have hired previously. I see a day when a company’s engineering labor force will consist of about 20% of these specialists.”

The Cross-Functional engineer is essentially the mechatronics engineer. This individual has more of a breadth of training, learning much about multiple engineering disciplines but typically not to the depth of the specialist engineer. These are the people corporations need to make mechatronics programs successful. Noted Ryan, “I think these people will make up about 40% of the engineering labor pool in a typical corporation.”

The cross-functional engineer can be further divided into two categories:

The Technologist: This individual is meant to be the functional extension of the traditional engineer; they implement the designs of the specialist. She/he is a member of a mechatronics team and will often function as a liaison among the specialists. This individual’s role is coordinative and integrative, both vertically and horizontally.

The Technician: This individual does what an engineer tells him/her to do. They are responsible for installation, service, and maintenance of mechatronically designed equipment. The remaining 40% of a corporation’s engineering pool will likely consist of these skills.

Mechatronics requires that either you master more than one or two engineering disciplines, or you develop a group of generalists to support the specialists. The cross-functional engineer will never replace the specialist engineer because they do not have a comparable depth of knowledge.

At Alexandria Technical College, the program is very successful. The college is in the middle of a huge packaging machinery area. By developing a cross-functional engineering program, graduate students find placement in all kinds of industry including transportation, mining, marine, automation, and other areas. “Once we took ourselves out of the packaging box,” said Ryan, “then we started finding lots of people interested in our students because these fields are all trans-functional fields.”

Corporate structure needs to nurture collaboration, not impede it
Global locations and engineers grouped by discipline do more to create miss-communications than solve it. “The biggest problem is interaction among disciplines,” noted Panaitescu. “Many corporations still physically group engineering disciplines so that engineers either work only with other engineers of their discipline, or they work in isolation.” The most successful companies have an open culture and nurture it.

Then there is the issue of cooperation, which can be sidetracked by corporate structure. “Engineers are naturally competitive,” said Panaitescu.

NI is also working on developing more collaborative design tools.

“But companies with more successful mechatronic design programs leverage the competitiveness between project-focused cross-functional engineering groups rather than having individual engineers competing against each other,” noted Pritchard. “The strategy of ‘which group will produce the best machine’ works well.”

Successful users of mechatronics also use a common design process that everyone sticks to. “One goal of a common design process is to ensure engineers check with each other throughout, ensuring that one decision does not impede future decisions from other engineers involved in the design,” said Panaitescu. “Corporations do not need to mandate that engineers attend communication classes; that is not the issue.”

Part of this common process involves the creation of a requirements document. It lays out in the beginning, what the design must do. Noted Panaitescu, “it is not often used because its not very interesting paperwork. But it can help speed product development.”

“The first step is to sit with the customer and decide what the device must do,” continued Panaitescu. “It will not significantly differ among projects. But if you define soundly, thoroughly, then everyone thrives. Naturally, the requirements will include performance, precision, timing, vibration and so on. But the requirements should also include how a system performs and how it will be designed; did you optimize that machine, reduce its carbon footprint? How much material did you put into the machine? These factors should be part of the mechatronics concept. The requirements change as we change. If you have such a process that incorporates physical mechatronics concepts with requirements concepts, then you have everyone in the team looking at the same goal, a common perspective.”

Proctor & Gamble, for example, has resolved many of these issues. Said Craig, “P&G has developed internal programs that have broken down the silos, embraced mechatronics, developed integrated design, and offer in-house courses that look at the mechanical, electrical, and controls. It’s doable.”

The need for truly interoperable software tools
The biggest issue with the various CAD and other product-development tools is that they do not offer the required level of interoperability that lets a controls engineer interact with the design of an electrical engineer.

“At first glimpse,” said Craig Therrien, product manager, Dassault Systèmes SolidWorks Corp., “it might appear that a simple movie of a machine in operation is all that is necessary for a collaborative mechatronics approach.

However, although a 3D-based mechanical CAD animation of intended machine function is a huge improvement over 2D drawings – and can help pinpoint potential collisions – it does not convey important engineering information that electronics and controls engineers need to select, size, and program the appropriate system. Nor can an animation alone help engineers factor the effect of their decisions into the mechanical design.”

Something more than moving pictures is needed to take advantage of mechatronics. Programs should provide control engineers access to mechanical engineering information, such as mass, material properties, moments of inertia, and force/torque requirements, to choose the most suitable electronic control mechanism. Mechanical engineers need to combine the loads created by specific electronic controls with the output of dynamics analyses to validate a system’s structural integrity. Controls programmers need to be sure the system functions as intended without any mechanical or electronics systems issues. In short, everyone involved needs an integrated mechatronics design environment that moves mechanical and controls design information in both directions. This helps the team to make important decisions and design modifications during the design cycle rather than as a result of costly prototyping.

Two soon-to-be-released examples of such a mechatronics environment are the integration between SolidWorks® Motion kinematics and dynamics analysis software and controls automation packages LabVIEW® from National Instruments and Motion Analyzer® from Rockwell Automation.

“With these integrated tools,” continued Therrien, “the mechanical engineer can model a machine in SolidWorks 3D CAD software and conduct kinematics and dynamics analyses in SolidWorks Motion software. Then, electronic systems engineers and control programmers can access the entire motion simulation from either LabVIEW or Motion Analyzer, including pertinent engineering data such as force, torque, and friction requirements, to design and program the control system. Finally, the mechanical engineer can access detailed controls information, such as the type of device or the size of the motor, to conduct additional stress and vibration analyses.

Noted Marc Monaghan, engineering systems manager at Hartness International, a manufacturer of packaging systems, “We are constantly looking for ways to reuse our design data, and the merging of mechatronic control simulation with mechanical design is an excellent approach. This integration extends the benefits of kinematic simulation into the arena of control programming, allowing the initial concepts of control logic to be designed and tested simultaneously with the mechanical function that it needs to control.

“Project timelines are more aggressive than ever, giving us much less time to develop designs with iterations of physical prototyping,” Monaghan added. “The integration of 3D modeling, analysis, and control development allows us to identify potential issues and opportunities for innovation long before the first part is produced. It is another step towards getting more problems solved during the design phase of a project, when cost savings and efficiency improvements deliver the most benefit.”

Engineers at NCR Ltd., a leading manufacturer of ATM machines, also desire and require better product design tools. According to Dr. John White, chief engineer at NCR, “We use mechatronics to optimize performance. An interoperable program, such as the SolidWorks and LabVIEW connection, gives our R&D teams the ability to develop a digital prototype in advance of a physical build. LabVIEW controls the motion trajectories while SolidWorks is used to calculate the driving forces, power requirements, and stresses. Connecting the control software to the mechanical assembly provides our engineers with the data needed for full design analysis and optimization. For us, it’s all about reliability through optimization.”

Dassault Systèmes SolidWorks Corp.
www.solidworks.com

National Instruments
www.ni.com

Rockwell Automation
www.rockwellautomation.com

But ironically, most motor manufacturers are predominately mechanical engineering centered.  And most drive electronics companies are electronics centered.  And they have very little in common with each other.  Except that their products must work together.  And oftentimes, that’s where the trouble starts.

The drive manufacturer warrants that his drive will produce current and voltage.  But the the motor can have very complex constraints to deal with in response to the excitation of the electronics.  How accurately a 6 step approximation of the sine wave performs, for example, can result in overheating in the motor depending on the loading of the system.  And as the motor winding heats up, the resistance in the motor can change dramatically, especially in the low inductance windings that are common in many specialty motors available today.

Then there are the cabling issues for connecting the motor and drive electronics.  The ac drive industry found out quickly that long wire runs can result in stored energy in the wires themselves.  Standing wave phenomena could cause higher voltages than expected and blow holes in the winding insulation in the motor.

Power semiconductor prices have fallen considerably in the last few years creating situations where it is sometimes cheaper and more reliable to put in parallel devices than to attached single power devices to large heat sinks.  This leads to some serious new options for packaging the electronics.  How about drive circuits in the end bell or junction box attached to the motor?  Actually, some models of the GE ECM motor (now owned by Beloit) are ac fan motors with variable frequency drives and intelligent controls built directly into the motor end bell.  You may have one in your main air handler in the air conditioning system of your home.  I was surprised to find out that I did.

I used to think that thermodynamics of these systems would be impossible to manage.  But the fact is that the drive efficiencies are getting really good.  One team I worked with was producing a 500 Watt brush drive that only shed about 20 Watts of loss at full load.  That’s some incredible efficiency.  So the notion of integrating motors and drive electronics is much more reasonable than it used to be.  And there are stepping motor packages that have been doing it for years.

So where is this all heading?

The fact is that the motor and drive electronics must work together as a package.  There is an increasing need, and an opportunity to create further performance enhancements, by the two technologies working more closely together.  More innovation will lead to better energy efficiency and new design opportunities and a chance to recharge (pun intended) an industry that has been losing share to offshore competition in the last few years.

This is not difficult to understand.  The forces acting on the gearbox are huge.  On the input side you have 3 blade propeller with blades that are now approaching 200 feet in length.  I don’t care how light weight they are, carbon fiber epoxy or Kevlar or whatever, the forces are tremendous.  In addition the blades have to rotate to take them out of the wind when the wind is too fast for the system to operate.  So there are actuators at the base of the blades adding to the weight and mechanical complexity.

Then there is the intermittency of the wind itself.  This can manifest itself as bursts of wind or winds of different speeds hitting the same rotor.  Which can lead to all kinds of impulse loads on the gearbox.  Gear teeth becoming momentarily unloaded and loaded in response to the wind.  This is actually one of my favorite “Stump the Band” questions for mechanical engineers; what is the formula for the shock load of gear tooth reversal?  It’s big, whatever it is.  And the shock load of the propellers is driving the gearbox against a high inertia load, the generator.  So there is a lot of resistance to overcome.

But the really scary part is that the gear systems are often in the range of 30,000 pounds in weight.  And they are mounted on metal masts at heights of 1.5 times the blade length.  So that would be 300 feet up in the air in the case of a system with a 200 foot blade.  Making the replacement of a failed gearbox a bit more complex than dropping the transmission out of a car, for example.  Especially since most wind farms are in very remote locations where the land is cheap and the wind blows some of the time.

This lead the Department of Energy to put out requests for proposals to address the technical question of providing the industry with a resource to help in the design of gearbox systems with much higher reliability than the current designs.  Total cost of this effort, approximately $100 million dollars.  The proposed test facility is targeting 20 megawatt power handling capability, or approximatley 27,000 horsepower depending on the exact rpm of the system.  This is an incredibly big piece of machinery.

Clearly, gearbox technology has to get better for the wind industry to continue to prosper.   I wonder if we are putting a band aid on a technology that is fundamentally flawed.  Maybe we need to be concentrating on the next generation of the technology and improving the cost performance by an order of magnitude.  Surely we can do better.

John Kowal and Tom Jensen are respected, well-known members of the packaging automation community. Over the years they have contributed greatly to the establishment of industry wide standards, the expansion of mechatronics education, and the adoption of advanced control technologies and competitive strategies for packaging system providers and users. They will lead B&R’s Packaging Group as Market Development Managers.

Tom Jensen brings with him more than 20 years of experience in machine development, motion control, and robotics. He is a longtime member of the OMAC Packaging Workgroup, PMMI Education Committee and Institute of Packaging Professionals. Jensen’s expertise lies in engineering management and business development within the realm of packaging automation.

Over the past 17 years John Kowal has successfully established technology companies and standards in vertical markets worldwide. His main career focus has been in the packaging industry. Kowal helped form the OMAC Packaging Workgroup. He is an active member of the PMMI Trade Show Strategy Committee, IoPP, ISA and BMA, and also hosts a popular Packaging Machinery LinkedIn Group.

Joe Krogman, Project Manager, and Marcel Voigt, Application Expert, are the technology experts within the packaging group. Krogman has more than 8 years experience in sales and engineering. Voigt has been working in the field of motion control for the past 6 years. Their extensive knowledge in packaging machine development will contribute greatly to the success of the B&R Packaging Expert Group.

B&R Automation
www.br-automation.com

::Design World::

In addition, the Magnetics 2010 Conference will be running concurrently at the same venue.  Magnets are a strategic material without which many motors would simply not operate.  In the ever-changing motor industry, there is always a new design that seeks to make an enhancement over previous solutions, or introduce a new solution to old problems.  Declining prices for Neodymium Iron Boron magnets over the last few years have created a number of novel design shifts which have been instrumental in bringing more varieties of permanent magnet machines into the forefront of motion control and mechatronic technology.  To the point where over the last two years a resurgance of permanent magnet rotor designs have been created to improve the energy denisty and lower the cost of specialty motors in washing machines and air conditioning compressors.

This last development, combined with the forecast increase of hybrid electric car sales coming this year, are expected to increase the sale of permanent magnets by 10-15 percent by 2011.  That’s a staggering jump in a market that is almost exclusively supplied by China.  And there is no assurance that China can meet the forecast production.

The US Department of Commerce usually has a say in the sale of products or businesses to foreign countries that are deemed to be strategic or sensitive technology.  In fact, I got stuck in a situation where my employer was told specifically that we could not sell a CNC controller to a Korean customer.  That’s pretty small potatoes compared to controlling the supply of permanent magnets which influences billions of dollars worth of electric motors manufactured and sold all over the world.  So it strikes me as a little odd that the sale of Magnequench to its current owners, Neo Materials, was completed without a much discussion. leaving the US without a domestic magnet supplier.

There will surely be a lot of discussion about this situation at the conference, and I will be in attendance to get the latest information on the subject.  So look forward to a review of the conference in an upcoming post.

Technology is a major driving force in the economy.  The ability to create whole new industries that have never existed before.

And there is a second driving force, sometimes made less obvious by the flash of the latest technical breakthrough.  Cost.  What is the relationship of cost to the development of industry?  As costs decline volume goes up.  Steel manufacturing per man year of labor increased 500% during a period of intense competition between the US and Japan.  And interestingly, one of the breakthroughs was the creation of the “mini-mill” which could produce specialty steels more cost effectively by making them in smaller batches.  Sometimes the solution is counter intuitive.  The steel industry was all about increasing batch size.  But serving the market with more complex products turned out to be easier with smaller batches, ultimately increasing overall sales and defending the US market to some extent from foreign competition.

Are there other cases where innovation was economically driven?  In the machine tool world the majority of manufacturers develop bigger and more complex machines so that a single machine can handle any operation.  This complexity tends to drive costs up quickly.  So the tendency is to find high performance machine tools costing hundreds of thousands of dollars.  In contrast, the HAAS company re-invented the machine tool business by focusing on making a low cost, high quality machine tool that many shops could afford to buy.  They were one of the first companies to have several models of machine tool in the $50K range.

They did it by concentrating on the economics of a machine tool that was profitable in operation.  That means a machine with a low cost to purchase, low operating and maintenance costs, and sufficient precision to meet the requirements of most operations.   In order to reduce their machine cost they had to develop their own controls platform.  They restructured everything in the design and manufacture of the CNC system to meet the cost objective.

In act, they are so successful, that HAAS is the largest CNC company in the western world.

Many similar situations exist in other industries.  In small plastic parts manufacturing there are a number of breakthroughs that have created lower cost parts in smaller batches based on innovative new tooling systems.  In metal fabrication there are new process like thixotropic molding and metal injection molding that have been developed to lower the cost of metal goods by making parts at lower costs.  These solutions are focused on reducing costs and other barriers to the entre of new products like tooling costs and minimum batch sizes.  And they represent major new markets that were not possible in the past, because they are focused on the economics of the industry they serve.  Decreasing the cost of entry and the cost of part manufacturing opens up new markets

So inventing the future can be technology.  Or as it can be economics.   It’s all innovation.  And it’s all about delivering value.

Many analysts have commented that the reporting of employment data in the US has been manipulated over the last few years and, for example, there is a whole category of people who are unemployed and are not being counted because they are assumed to have quit looking for work.  (How’s that for cynicism)   And China has been accused of artificially holding it’s currency value low in order to minimize the impact of decreased exports.   Interestingly, US exports are up significantly due to the weak dollar, so there’s at least some silver lining to the clouds of an economic downturn.

But the real road to recovery is based on real value.  Technology is great, it enables a lot of new product concepts that make our lives more convenient.  But the root is in the value that is delivered.  That value can be something compelling, like the iPod, which offers the convenience of incredible portability and simplicity in delivering entertainment media, or a major improvement in the energy storage capacity of batteries which makes hybrid cars possible.  The value that a product delivers is what makes it attractive and drives a customer to own it.

This means that technology cannot be dissociated from it’s economics.  The electric car is still a challenge because a cup (about 20 cents worth) of gasoline contains enough energy to move a 2 ton car down the road to the gas station when you’ve run out.   Which is a very cost effective exchange instead of you and several of your friends pushing your SUV to the next station to fill up.  So an electric car should cost about the same to operate as a gasoline car unless there are many people who are willing and able to pay a premium to drive electric.  And it’s getting there, and there are quite people who will pay the premium.  About 300,000 a year now.

But there is no product on the market that is immune to improvement.  So the thing that will really get the economy moving, and get people working, is product development.  Any improvement that enhances the value of a product is important to the success of the US as a nation.  That means everything.

That’s why the current dialog in the alternative energy sector is so important.  Significant improvements such as direct drive generators in the wind market and lower cost tracking technology in solar offer big advantages in the overall economic performance of these technologies.  This will reduce the amount of tax dollars that have to be used to subsidize the emerging industries.  And I’m betting there are a lot more improvements to come.

So the road to recovery is improving value.  In any product, in any market.  And that’s change we can really count on.

As a former resident of Colorado, the Public Service company provided electricity and natural gas throughout the region.  In Texas there are many power companies, Austin Energy being the company in the area where I live.  In both cases the State Legislatures run the utility companies.  So there is a strange mixture of a commercial enterprise selling a product in a broad commoditized market, with the assumed objective of making a profit.  Utility companies used to be considered very secure investments, if somewhat low return.

But being a government run enterprise, they are subject to legislative regulation, and in recent times the mandated goals and  balancing the books appears to be in conflict.  Both Colorado and Texas have passed legislation requiring that the utility companies put up wind farms and solar projects.  In spite of studies that reported the cost for alternative energy would be greater than the cost of coal fired electricity. In addition, the legislators have required that the utility company pay customers rebates to help underwrite the cost of solar installations.  And the utility companies are required to buy the excess generated electricity from the customer.  How are the utility companies supposed to survive under these conditions?

The cash squeeze got so bad that Austin Energy had to notify over 150 customers with solar projects that were already approved that they didn’t have the money to pay for them.  And further, the utility company said it projected a need to increase rates over the next few years as the cost of wind power and solar power projects that were being added to the electric power mix are coming on line.  Exactly as predicted by the industry consultants.

Utility companies are in the business of providing reliable, low cost energy.  Utility companies are not typically in the business of developing new power generation technology.  This has lead some several companies to look at their opportunity to fulfil the operation and management role across all the power technologies available.  And initial projections support the idea that this is a direction that will sustain the role of the utility.

Our standard of living and our manufacturing base depends to a certain extent on a low cost of electricity, just as transportation costs are dependent on the cost of fuel.  Maintaining good supplies of both and keeping costs low are foundational to a strong economy.