MIT Commissions Special Touchy-Feely Robot Skin To Be Made

Peratech Limited has been commissioned by the MIT Media Lab to develop a new type of electronic ’skin’ that enables robotic devices to detect not only that they have been touched but also where and how hard the touch was.

The key to the sensing technology is Peratech’s patented ‘QTC’ materials. QTC’s, or Quantum Tunnelling Composites, are a unique new material type which provides a measured response to force and/or touch by changing its electrical resistance – much as a dimmer light switch controls a light bulb. This enables a simple electronic circuit within the robot to determine touch. Being easily formed into unique shapes – including being ‘draped’ over an object much like a garment might, QTC’s provide a metaphor for how human skin works to detect touch.

Uniquely, QTC’s provide a ‘proportional’ response – in other words detecting ‘how hard’ they have been touched. Further, using Peratech’s patented xy scanning technology, the robot is able to detect where on a matrix of sensors applied to areas such as the forearms, shoulders and torso, it has been touched.
As robotic devices continue to make inroads to our daily life, their ability to understand the presence and interaction with humans and other objects within a space becomes critically important. This research project is hoped to produce results which could soon be applied to a range of robotics projects that MIT works upon.

Peratech’s QTC technology has an established track record for use in robotics, having previously been adopted by NASA for their Robonaut device and by Shadow Robot in the UK, producers of what is widely regarded as the World’s most advanced robotic hand, which have utilised QTC to sense ‘touch’. However, this project with MIT is a World first in enabling a human to interact – through touch across the body of a robot – much as they would with another human.

Hexapod Robot Gives 10lbs Of Force For Medical Applications

The miniature hexapod system provides more than 10 lbs of force and motion in all six degrees of freedom.
It can be used for manufacturing and placing of parts requiring very high precision, for microscopy applications or laser and optical alignment

After two decades of experience with the design and production of hexapod robots, PI’s electro-mechanical / piezoelectric six-axis positioners are among the most advanced multiaxis precision motion control systems in the world.

Features and Advantages of the M-810 Miniature Hexapod

• Operation in Any Orientation
• High-Stiffness 6-Axis Hexapod with 5 kg Load Capacity
• Very Compact: 10 cm Diameter, 11.8 cm Height
• 0.2 Micron Minimum Incremental Motion (40 nm Resolution)
• Long Travel Ranges to 40 mm (linear) and 60° (rotation)
• Powerful Controller with Freely Definable Virtual Pivot Point
• High Velocity of 10 mm/s
• Linear and Rotary Multi-Axis Scans

Parallel Kinematics Advantages
Parallel-kinematic motion systems have a number of advantages over standard serial kinematic (stacked) positioning systems:

Virtual Pivot Point: Rotation Around any Point, not unlike the Human Hand
Only one Moving Platform, No Accumulation of Guiding and Lever-Arm Errors
No Moving Cables for Improved Reliability and Precision
Smaller Package Size
Increased Stiffness, Reduced Inertia, Better Dynamics

Smaller Motors and Encoders, Controller & Software Included. The limited space necessitated the usage of new  technologies for encoders, motors and other integrated electronic components.  The M-810 is compatible with PI’s tried and proven hexapod controllers that are supported by windows software and a library of drivers and programming examples for applications such as optical alignment etc.  PI also provides simulation tools for hexapod integration.

PI Hexapods come with load ranges from 2 kg to >1000 kg.

Applications

Precision manufacturing, high precision placement of parts; alignment of optical components & lasers, microscopy applications, neuroscience.

www.physikinstrumente.com

NASA Reveals Robot Astronaut: Robonaut 2

NASA is turning to robotics to help their astronauts while in space.  NASA scientists have developed a new dexterous humanoid robot which can work side by side with humans

Robonaut2, or R2, is the next generation dexterous robot that uses the same tools as humans, allowing it to work safely along with people, a necessity both on earth and in space. The machines are faster and can use their hands to do work beyond the scope of prior humanoid machines.

R2, the next iteration of Robonaut, could assist astronauts during hazardous space missions using leading edge control, sensor and vision technologies.

Working side by side with humans, or going where the risks are too great for people, machines like Robonaut will expand our capability for construction and discovery.

According to NASA, the robots were developed with General Motors through a Space Act Agreement to accelerate development of the next generation of robots and related technologies.

DASH, The Robotic Cockroach, To Save Lives In Haiti

UC Berkeley’s Department of Electrical Engineering is developing mini-robots to help locate earthquake survivors easily, cheaply, and quickly, and without jeopardizing the lives of rescuers.

First Robotic Radical Cystectomy Deemed a Success

The first first robotic radical cystectomy, a surgical procedure to treat invasive cancer of the bladder, was recently performed at Saint Joseph’s Hospital of Atlanta. Dr. Rajesh Laungani, Director of Robotic Urology at Saint Joseph’s, performed the minimally-invasive surgery.

Invasive bladder cancer has a very high mortality rate and generally results in death if not treated. During a radical cystectomy, the entire bladder (and prostate, if the patient is male) is removed. According to Laungani, performing this robotically allows for a minimally invasive approach. The advantages include less blood loss, less pain, and quicker recovery. Just as importantly, it provides comparable rates of cancer cure as compared to more traditional surgery.

In 2004, Saint Joseph’s Hospital in Atlanta was designated as the exclusive training center in the Southeastern United States (Georgia, Alabama, Florida, South Carolina and Mississippi) for robotic surgical systems. Since that time, Saint Joseph’s has become the world-wide site for surgeons to train on robotics.

www.stjosephsatlanta.org

Robotics Industry Optomistic for 2010

The robotics industry, like the world economy, is slowly emerging from the most trying economic times since the 1930s. The automotive sector, traditionally the core of the robotics industry, is depressed requiring robot manufacturers and integrators to find substitute markets in North America and beyond.

“My outlook for the robotics industry in 2010 is cautiously optimistic and unsettled. Some projects are coming back alive that have been dead a long time,” says Joseph Campbell, Vice President Sales and Marketing of ABB Robotics. (Auburn Hills, Michigan). “Industry analysts are trying to gauge if fourth quarter activity is by companies who have not done any capital investment in 2009 or is it the start of a true recovery.” Orders for new robots declined 30 percent through the third quarter of 2009, with the automotive industry slipping at approximately the same rate. Automotive-related companies typically account for about 60 percent of robots ordered in North America.

Finding Opportunities in Crisis
With the fall in robot orders by the automotive industry in 2009, robot makers and integrators accelerated efforts to find new opportunities. “The robotics industry is in a transitional phase because the automotive industry has been decimated. The robotics industry is trying to find its footing, trying to grab an industry to be its main go-to,” says Patrick O’Rahilly Jr, Director at Compass Automation (Elgin, Illinois). “The automotive sector has been the main hub of the robotics industry for a very long time. Renewable energy could be the new main industry for robotics.”

“The bottom fell out of the automotive market, which the robotics industry heavily relies on. That fallout has forced the robotics industry to look outside of its comfort zone and move into emerging energy technologies like batteries, wind, and solar power,” says Roger Christian, Vice President of Marketing and International Groups at Motoman Inc. (West Carrollton, Ohio). “Returning to historical levels of selling robots in renewable energy will be slow because these industries at first do not offer the same unit volume that automotive did.”

While the automotive market took a big hit in 2009, some signs of life remain in North America, says Christian. “The Ford Fiesta program in southern Mexico and the Volkswagen program in Chattanooga, Tennessee provided unit volume from these OEM’s and their Tier One suppliers.”

Solar panels could be a saving grace for the robotics industry. “Solar panels will take off in 2010, but it is difficult to say how fast. Manufacturing solar panels requires robotics,” says Åke Lindqvist, a member of the Robotic Industries Association’s (RIA, Ann Arbor, Michigan) board of directors and Vice President of ABB Robotics. “I see smaller fuel cells that can power laptop computers for 40 hours rather than four hours. If fuel cell manufacturers want to produce millions of those per year, they will need robotics.” Lindqvist expects increased opportunities for robotics in fuel cell and solar power during 2010.

Roger Christian adds, “Making solar panels has a demand for robotics such as handling the silicone wafers throughout the slicing, polishing and stringing processes, as well as assembling the panels. Solar is a great growth area for robotics.” A newer type of panels, thin film solar, is a bright spot for robotics too, says Christian. “Companies in Silicon Valley are looking at thin film solar and have launched prototype manufacturing cells that have included robotics. I see thin film solar as an area of growth for robotics.”

The Stimulus Act passed by Congress in early 2009, a $787 billion package of tax cuts, state aid, and government contracts, has made some impact on the alternative energy market in favor of robotics, remarked Mick Estes, National Distribution Sales Manager at FANUC Robotics America Inc. (Rochester Hills, Michigan). “Stimulus money is getting companies to think about the solar market and other alternative energy areas. We see activity in the battery assembly market.” Money from the Stimulus Act is making its way to automate “green” production such as wind and solar power, says Estes.

The push for wind power is creating an opportunity for robotics in gear manufacturing, says Patrick O’Rahilly. “Gear manufacturing is an important and large industry and one that Compass is pursuing related to making wind turbines.”

Richard Litt, RIA’s out-going Chairman and founder of Genesis Systems Group LLC. (Davenport, Iowa) also sees wind power as an opportunity for robotics in 2010. “Genesis has seen a little business in machine tending applications in machining the giant gear sets for wind turbines.”

Similarly, Christian sees increased possibilities for robotics in putting together wind turbines, especially their gear assemblies. “I see three areas where robotics will play an increasing role in the wind turbine market. One area is deburring or hardening the huge gears in the nacelle. Fabrication of the towers also requires robotics with adaptive welding software to make them.” Christian explains that 200-foot high towers are constructed in 10-foot lengths. Due to their size, turbine towers cannot be transported across oceans but are assembled on-site.

Christian’s third area of robotics for wind turbines is fabrication of the blades. “Manufacturing wind turbine blades is a promising area for robotics, particularly in coating and finishing operations.”

Pharmaceutical and life sciences could prove to be promising areas for robotics in 2010, says Estes. “I anticipate growth in the life sciences and pharmaceutical markets, which are expected to be strong areas of focus for FANUC Robotics in 2010.”

ABB is offering more tabletop robots for the pharmaceutical and life science market, declares Joe Campbell. “In 2009, ABB introduced a small six-axis tabletop robot for pharmaceutical, life science, and medical device assembly and handling applications. This robot can be used for testing medical devices and assembling consumer electronics.”

Stuart Shepherd, President of KUKA Robotics Corp. (Clinton Township, Michigan) has a similar take on openings for robotics in the pharmaceutical and life sciences markets in 2010. “Medical device, drug discovery and laboratory applications are experiencing a tremendous amount of growth. We see these industries growing in 2010 as well as a few others.”

Food for Thought
Food and beverage applications have promise for the robotics industry in 2010 according to Rich Litt. “Food and beverage applications continue to have nice growth and we are seeing a trend away from hard automation in these applications and more towards robotics. At PACK EXPO last October, I was stunned at the amount of robots in the show and the migration from hard automation to robotics in food processing.”

ABB’s Campbell agrees, saying, “The food industry is looking to find ways to remove the human touch from food processing and packaging, which is a health and cleanliness issue. The combination of the nature of food processing jobs and the movement of these jobs to locations outside of urban centers makes for increased opportunities for robotics.” Campbell goes on to say, “When a food company comes out with a new food line, they invest in the manufacturing equipment that will go into that new product, such as robotics.”

In spite of unemployment levels, some jobs are difficult to fill, like food processing.” Food processing is notoriously dangerous contends Campbell, which drives manufacturers to invest in robotics. “When food processors find an unsafe process or a process that has significant risk for repetitive stress injury, they increasingly invest in robotics.”

The food and beverage market also offers an area of growth for Motoman, observes Christian. “The food and beverage market will continue to generate a large amount of revenue. In 2010, we predict further growth in this area of about two percent. When food processors started to use robots, they realized that robotics offers a tremendous amount of robustness and flexibility.”

Christian points out that food processors understand the limitations of hard automation. “If a food processor bought dedicated machines for packaging a certain size of potato chip package but need to change that size because the market demands variety packs, that food manufacturer lost flexibility. Food manufacturers are getting excited about robotics, so I think that this market will continue to grow in 2010.”

Going Where the Growth is
While North America and Western Europe are experiencing tough economic times, other places in the world hold out hope for robotics. “China is continuing to grow and they believe it is the end of the world when their gross domestic product growth is below nine percent. China is sitting on a lot of cash and continues to invest in robotics,” says Litt. “Genesis is doing business in China for our North American customers who moved some of their production there. In many cases, the source of robotics in China is North America.”

Opportunities abound in China, says FANUC’s Mick Estes. “China has seen a significant increase in robotics to increase productivity and quality to meet the needs of a growing middle class.”

Christian also sees market possibilities overseas. “China, Brazil, India and Russia, in that order, will be the fastest areas of growth for robotics in the traditional application areas.

Turning his attention to Brazil, Christian says, “Brazil is doing very well: Their recession was shallower and less lengthy than in the US. The Brazilian currency has stabilized, and with the weak dollar, buying automation from the US is popular now.” Christian maintains that Brazil is on the cusp of considerable growth in the next few years. “Brazil is energy-independent, has tremendous agricultural capabilities, and is upgrading their ports. With 190 million people who consume almost three million cars a year, Brazil is poised to really explode in the automotive and durable goods markets.” The robotics industry sees Brazil as a bright area for growth and will take advantage of that in 2010.

2010 Robot Buzz
What concepts will the robotics industry embrace in 2010? “Lean robotics for lean manufacturing” is Joe Campbell’s buzz phrase for 2010. “I see a new respect and understanding for ‘lean’. ‘Lean manufacturing’ used to imply no automation and people with simple tools making products that can be changed easily.” Campbell believes that robotics goes to the heart of lean manufacturing. “When properly implemented, robotics supports all the tenets of a lean process. ‘Lean robotics for lean manufacturing’ has been a good theme for ABB.”

Taking a similar track, Roger Christian foresees “lean and flexible” as the robotics industry’s buzz phrase in 2010. “As lot sizes get smaller in a production environment, manufacturers need to be able to manage capital equipment to make a variety of products quickly,” Christian says. “‘Lean and flexible’ is rethinking a typical robot work cell to incorporate moving parts and handing parts once while moving these parts from one process to the next.”

“‘Save your factory’ is a great term and a great presentation but it has not caught on yet,” says Rich Litt. “Genesis and other RIA companies participate in Save your Factory because automating domestically is smarter than moving to countries with low labor costs.”

Mick Estes concurs, saying, “Save your Factory’s message is that the move to low-wage countries might not have been everything manufacturers hoped it would be.”

2010+
While the economy is showing indications of recovery, the robotics industry is not holding its breath. “The outlook in 2010 will be better than 2009 but not near 2007 levels unless the economy gets an unexpected resurgence in consumer confidence and people start buying more durable goods. Also, a glut of 4,000 to 7,000 used robots is on the market due to plant closings,” says Roger Christian. “Robots are built so well that they keep running.” Christian concludes, “I am excited to see the robotics industry returning to a billion dollar industry,” but cautious, “it will take a couple of years to get there.”

“From a global perspective, we expect to see continued rapid growth of robotics in China, India, Korea, Indonesia, Malaysia, Vietnam and other countries with growing manufacturing operations, which creates opportunities for our members,” said Jeff Burnstein, RIA President. “And, I agree with those who say that manufacturing in North America may show a revival as companies realize that automating manufacturing here is a better solution than sending manufacturing operations offshore. So, long-term I remain very optimistic about the outlook for the robotics industry.”

www.robotics.org

Leadership in Engineering

Leadership in Engineering

This is the 3rd annual Leadership event announcing the winners in the 2009 Leadership Awards Program. The Design World User Community have cast their votes and we are pleased to announce the winners.

ADVANCED MATERIALS

Da/Pro Rubber is a custom manufacturer of precision rubber, TPE, and plastic molding products. The proprietary Da/Pro process adjusts for rubber compound and rubber part configuration variables so that it can produce high tolerance parts of consistent quality. The company offers complete in-house capabilities from design for moldability, rubber compound development, lab testing, mold construction, subassembly, and quality assurance.

Digital Manufacturing

Proto Labs’ quick-turn Protomold® injection molding and First Cut® CNC machining services are the fastest in the world at providing design engineers with real parts based on their 3D CAD models. We achieved this unique ability by applying proprietary software and parallel processing technologies to the automation of standard manufacturing processes, so engineers can finally have it all : real parts in as little as one day.

Electrical & Electronic

Since 1976, Glenn Taylor’s vision of an enterprising engineer has been our guiding force. Our goal is to design and manufacture standard industrial control products that meet or exceed customer and industry specifications for quality and operation. We engineer more features, more functions and more flexibility into our products, and we are able to offer a lifetime warranty for them.

Fastening & Joining

Bal Seal Engineering, Inc.’s original product was a plastic ring with a groove to house a coiled spring. Today, the company’s patented canted coil spring energized PTFE is at the core of its product offerings. Bal Seal offers custom-engineered sealing, connecting, conducting, and shielding products for medical electronics, medical device aerospace/defense, energy management, automotive, and industrial applications.

Fluid Power

Norgren’s vision is to create competitive advantage for its customers. By exploiting the potential of motion and fluid control technologies. For Norgren customers this means better results, faster/more efficient machines, improved machine performance, increased reliability/uptime and lower cost of ownership. Application specific solutions frequently involve integrated or modular combinations of actuator, control valve and air preparation technologies. Within the field of motion control Norgren develops solutions for automation applications and within the field of fluid control Norgren combines proven brands to offer solutions for handling air, water, oil and other fluids.

Mechanical

Arrow Gear Company is among the most technologically advanced gear manufacturers in the world. With a facility of over 145,000 square feet, Arrow is equipped for a full range of precision gear machining, heat treating and inspection capabilities for spiral bevel gears, spur and helical gears, curvic couplings – as well as complete gearboxes.

Arrow has earned a reputation for providing high precision gears to the global market for a wide variety of aerospace and commercial applications.

Arrow’s advanced technologies reach beyond machine tools alone. Arrow is equipped with design and development capabilities that are on the leading edge of the industry. Utilizing Gleason CAGE, GAGE, MINIGAGE, Finite Element and Fully Loaded TCA software, Arrow engineers can create computer models which accurately predict gear design performance. This process for contact pattern development is dramatically more efficient than conventional methods.

Motion Control

PBC Linear is a leader in providing linear and rotary solutions, specializing in everything from out-of-the-box components, to mechanical sub-assemblies, to complete linear systems. PBC Linear’s team of expert engineers draws experience from years of mechanical and design engineering both in the classroom and in the field. Their skilled staff, sophisticated tools, and innovative products create long lasting solutions for the toughest motion control problems.

Software

COMSOL Group provides software solutions for multiphysics modeling. A fast growing engineering software company with a proven track recor, Comsol was founded in July 1986 in Stockholm, Sweden, and has offices in Denmark, Finland, France, Germany, The Netherlands, Norway, India, Italy, Switzerland, United Kingdom, and U.S.A.

Switches & Sensors

MTS Sensors, a division of MTS Systems Corp., is the global leader in the development and production of magnetostrictive, linear-position and liquid-level sensors. Using MTS’s patented Temposonics® technology, the Sensors Division is continually developing new ways to apply magnetostrictive sensing technology to solve critical applications in a variety of markets worldwide, including steel, wood, plastics, metalworking, automotive, and off-highway. It also applies megnetostrictive technology to the packaging, oil, gas, food and beverage, and medical industries. MTS Sensors Division has facilities in the U.S., Germany, and Japan, and is an ISO 9001 certified supplier committed to providing innovative sensing solutions that deliver customers with reliable, cost-effective position-feedback devices.

Test & Measurement

Omega is a major US company that manufacturers more than 80% of its product offerings in house ─ and this percentage is continuously increasing. At a time when “outsourcing” seems to be the foundation of many US manufacturers, Omega Engineering, headquartered in Stamford, Connecticut, remains a notable exception. Omega enjoys this leadership position because it strongly advocates process automation to achieve high productivity and create quality products. When commercial equipment is used, in-house automation handles the input and output processes. Omega’s automation engineers are among the most talented, and it has invested substantially in the model shops and labs needed to support them. Working with an equally talented staff of software engineers, they produce a wide range of custom automation equipment.

Multi-Touch ‘Resistive’ Touchscreen Controller Chip

As the latest high-tech devices such as smartphones, mobile internet devices and netbooks adopt multi-touch touchscreens to support increasingly sophisticated ‘apps’ and games,STMicroelectronics has introduced a multi-touch ‘resistive’ touchscreen controller chip to optimize the Bill of Materials of the electronics supporting this advanced capability. The STM32TS60 is the first member of ST’s new STMTouch family, which offers a broad portfolio of solutions including multi-touch devices and proximity and touch-key sensors.

The new multi-touch controller detects up to ten simultaneous touches with fingers, nails or stylus, enabling application designers to replace complex menu sequences with more direct and natural user controls. Actions made easier with multi-touch capabilities include browsing and selecting options, handwriting and data entry, arranging and sizing windows, picking up and dragging images, and fast and intuitive game play. Other abilities include drawing pictures, using touch pressure to adjust line thickness.

Employing resistive touch-panel technology, the STM32TS60 controller offers customers a real alternative and complements the recent industry trend for using capacitive touch technology. Resistive technology is a cost effective and mature high-volume solution that has seen dramatically improved performance over the past few years in terms of durability and display transparency. In addition, it easily overcomes EMI (electromagnetic interference) noise issues, which can be an inherent limitation with alternative touch technologies. Resistive technology is already widely used in PDAs and similar touch-enabled devices and the screens are readily available in standard LCD sizes and at competitive prices.

The new chip combines the company’s STM32 microcontroller architecture with PMatrix^TM Multi-Touch technology from ST‘s partner Stantum to achieve fast response times while minimizing system complexity and component count.

The STM32TS60 single-core microcontroller is an added-value solution compared to other expensive multi-core processor or digital signal processors (DSPs) requiring specialized programming expertise.

The STM32TS60’s high EMI immunity makes it suitable for use in multi-function wireless products such as cellphones, notebook PCs, netbooks and mobile Internet devices. Moreover, its low power consumption helps to maximize operating times and recharge intervals, and is a direct benefit of the STM32’s energy-saving design features and ARM® Cortex™-M3 processor conceived for power-sensitive embedded applications. In addition, very-low-power idle mode with ‘wake-up on touch only’ helps further extend mobile battery life.

The STM32TS60 is housed in a 7 x 7mm 144-pin UFBGA package, and is now sampling to lead customers. Volume production is expected for Q2 2010.

www.st.com

The Road to Recovery

Economic recovery, job creation, whatever you want to call it, everyone is trying to figure out how to get employment numbers back up and get the economy back on track.  Seems that the situation is pretty severe, and we’ve managed to export it to all of our trading partners.  But there is controversy over the information being reported.  The news is in the position of impacting the tone, so they can make things sound bad, or not, depending on who’s data they use and how they phrase their comments.

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.

Energy Future – Reinventing the Power Company

It seems trite to say it, but the world around us is changing quickly and in some unanticipated ways.  The venerable electric power companies invented by Thomas Edison over a hundred years ago are going through some tough times.  In a seeming contradiction, demand for electricity continues to rise, but revenues and profits are declining as more alternative energy projects are coming on line.

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.

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