Many of the constraints of the work are environmental.  If work is being done outdoors, then temperature and humidity are a factor.  Felling trees and in the forest requires extremely high forces due to the work needed to cut through a tree and drag it to a truck to be hauled off for processing.  Processing trees, even in a plant environment, requires some serious hardware, 125 horsepower band saws are not unusual.

Doing work on a ship or oil rig has additional constraints because of the presence of explosive fumes and fuels.  Often the need to avoid any possibility of igniting a combustible atmosphere causes engineers to apply pneumatic control systems.  Yes, there is still a compressor somewhere to generate the compressed air supply, but that is usually remote or contained to avoid exposure to the volatile atmosphere.

Environmental constraints come in many forms.  Extremely high temperatures push the limits of what is possible.  Making glass, semiconductors, and primary metal processing are all high temperature environments where engineers have developed whole technologies in order to bring us the materials we use in everyday life.

The simplest action of rolling or sliding becomes a real challenge when environmental constraints are added to the work statement.  Sawdust becomes a potential abrasive in woodworking environments that can introduce severe wear in moving parts.  Corrosive and explosion proof atmospheres as well as food industry applications introduce all sorts of chemical compatibility problems that require special materials and processes in order to meet strict guidelines for safety.

As always, resourceful engineers have worked out solutions for all of these difficult applications.  One family of solutions to rolling applications is the use of all ceramic bearings.  No steel, no lubrication.  None is needed because the ceramics are extremely high purity to start with and have extremely high precision surfaces eliminating the need for lubrication.  No outgassing or contamination to worry about.

Other solutions take the form of air bearings and non-contact material handling devices.  Air bearings have become more readily available for conventional applications, but are particularly compelling in large machinery applications where precision is required.  Large flat screen display glass  presents unique challenges that successfully addressed using a combination of air bearing regions and vacuum regions to move the glass without actual contact and with overall flatness measured in millionths of an inch.

A unique solution in pneumatic material handling takes compressed air driven into a funnel shaped recess and creates a vacuum in the center and an air cushion at the edges where the air is exiting.  This creates a vacuum pickup that never quite comes in contact with the part, leaving no marks.  Perfect for solar cell and some food and beverage applications.

Engineers continue to meet the unique challenges of industry and create commerce at the same time.  And that’s what it should be about.

Mechatronic Tips

Cooking raw sugar and turning it into white sugar, for example, requires incredible amounts of heat and steam.  And generating steam requires a lot of energy.  Steam is very expensive to generate and almost impossible to store.  The cost of steam is so high that plants measure steam loss by the second.

Producing magnesium as a metal is a large scale electrolytic process.  The emphasis is on electrolytic.  The plant I visited measured current in 10′s of thousands of amperes.  There was so much power that the PC screens in the building had to be triple shielded or the magnetic field of the power distribution system would mess with the displays.  Huge annual cost of energy.

Where industry and commerce require significant amounts of energy to operate, these businesses become very sensitive to the cost of energy.  The same is true for individuals.  As the cost of gasoline increases we must individually choose to use less, or since some people don’t have the option to use less, pay more for gasoline and have less income to spend on other things.

Energy policy under the direction of the DOE and Congress has promoted solar power and wind power over coal, natural gas and nuclear energy.  There are two problems with this approach.  First, these technologies are very expensive.  Any time someone promotes technology and won’t talk about cost, you should be suspicious.  And that has been the history of alternative energy.

The second problem is that there is currently no way to store the power that is generated.  So unless you can use the power immediately, you’re in trouble.  A popular solar project is cited that used solar panels to generate peak power during the summer afternoons during periods of increased power demand when high air conditioning loads are required.  This is still a very expensive solution, but where the utility charges 3 or 4 times more for electricity during peak demand periods, this solution makes sense.  But it is a very limited application.

The question is, who decides how much energy will cost in the US?  State governments grant permits to open a utility.  They also decide what the utility companies’ goals will be.  The DOE has created consensus about alternative energy without approval from Congress.

Do the decisions of the government make sense?  That’s where the controversy starts.  If you are trying to run a business, then anything that increases costs is probably bad.  But no one in government appears to be listening.

Many businesses and almost every consumer is impacted by the decisions made by government.  Every extra dollar that is spent on lighting,  heating and cooling, and transportation is a dollar that is no longer discretionary.  So maybe that’s the real question.  Who decides what you and I spend our money on?

To the extent that government Policy causes dollars to be paid as increased energy expense, then the rest of the consumer economy suffers.  Which is part of the current problems that our economy is currently experiencing.

Mechatronic Tips

In part, a strategic energy policy should include incentives for people willing to engage in the risk of financing photovoltaic plants and wind power projects.  One of the problems with this is that the technology is not cost effective compared to the established methods of generating electricity.  More on that shortly.

But of great concern is how the “incentive” programs are designed to work.  And are they working as intended?

The creation of a “Feed in Tariff” (FiT) is one mechanism that the state governments use to incentivize investment in photovoltaics.  However, the FiT is limited in how much capacity can be built in the photovoltaic supply of electricity.  It has to be funded at the State government level.  So this is really a transfer payment from a group of taxpayers to a small group of investors to get the PV plant built.

In another frame of reference, when we consider the cost of producing energy, the history of the last hundred years has resulted in a mature industry that delivers power on demand to 300+ million users for pennies per kilowatt hour.  The purchase price of a coal fired power plant to produce energy in the US is in the range of $5.9 million per megawatt of capacity.  And that capacity is available day or night.

By the way, this also means that charging electric cars at night, when demand is generally lower for the power plant, is a great way to make the plant more profitable.

So the remaining question is; if you were really worried about the environment and felt that coal and natural gas were bad for the environment, what are the choices and most of all, how expensive is that going to be?

Well, if you are paying 14 cents a kilowatt hour presently, understand that your utility company is probably paying anywhere from 23 to 30 cents per kilowatt hour to buy the power from photovoltaic sources.   That’s pretty expensive.

And photovoltaic plants suffer from the fact that they only operate during daylight.  In fact, they only operate at peak power 2 to 3 hours a day.  Which is only 1/8 of the 24 hour day.  So the asset is only producing 12.5% of the time.  So they are not very cost effective with out a lot of subsidy money coming in to pay for them.

Nuclear power using wave reactors or pebble bed reactors can be very small, are very safe and they are also very economical.  They operate 24 hours a day and don’t emit any pollution to the atmosphere.  At an estimated $6.8 mil/mW they are the ideal alternative for those who are Eco-conscious without breaking the bank.

So why aren’t we hearing more about this option?

Mechatronic Tips

Among the many interesting developments, many new product technologies, many new solutions focused on cost reduction, and many lessons learned along the way.

In the new developments, there are a number of new product entries, especially in the concentrating solar panel area.  As a subset of the Concentrating Solar category, there are a group of products which are similar to conventional solar panels, but use a lens like a magnifying glass to concentrate the sun’s light on a small patch of silicon that converts light to electricity. This approach has been around for a while, but in the past has had thermal problems due to the heat that is produced.  Remember setting a dry leaf on fire with a magnifying glass when you were a kid? Same thing.

The cost of the optics have come down and combined with the reduced cost of the silicon used, makes this type of concentrating solar more competitive.  But this type of concentrating solar technology requires 2 axis solar tracking with a fair amount of precision in order for the optics to do their job properly.

So there are a lot of new tracking systems coming into the market as well.  Large array trackers with high angular precision and high force from vendors like Bonfiglioli of Italy, Sener and TGB Group of Spain.  These systems are generally high reduction ring gears with a precision worm and spur output in the final stage.  Once again, a major mechatronic challenge in the middle of solar technology.  To say nothing of the incredible mechatronics required to manufacture solar panels.

There are five or six vendors who have built and installed these CPV systems have an interesting advantage.  They are reporting efficiencies of 22% and higher.  This is really amazing considering that the conventional photovoltaics are are typically in the range of 12% and thin film are 8%.  These are very significant developments in making the technology more cost effective.

And the forecast growth for solar in the US continues to be, well, “sunny”.  Sales of solar products in the US are expected to double again next year.  Which is amazing.

Its hard not to get excited about it.  But there is an important truth to be considered.  Solar Energy is still highly government subsidized.  The history of solar energy is built largely through the “Feed In Tariff”.  This is a mechanism where the utility company agrees to pay a premium price for electricity generated with photovoltaic equipment.

In the early years of 2000 the Spanish government set the highest Feed In Tariffs in all of Europe.  This caused a massive influx of companies to ramp up to manufacture and install huge amounts of equipment.   And therein lies the problem.  Spain has too much capacity and not enough demand.

Germany, which has relatively poor sunlight, has led the entire EU in solar installations. German PV engineering and capacity are well know around the world.  But what’s different about the situation in Germany is that the feed in tariff is being reduced gradually to allow the industry to adjust to demand that is not subsidized.

There are 2 lessons here that are very important.  We must be careful to not “overbuild” based on enthusiasm.  And we must protect American interests by purchasing domestic products.  And currently, our political leaders do not appear to be paying attention to either of these issues.

Mechatronic Tips

Which is saying a lot.

Some of that economic activity is the obvious stuff.  Jobs.  Making things that are important to the industry.  Like all the silicon ingot, water treatment, chip encapsulation compounds, chemical solvents, and gases that are needed.  And all of those feedstocks require people in their respective industries.

There is also the capital equipment market.  Companies that make machines that make chips.  Machines that grow silicon ingots, machines that slice silicon into thin wafers.  Polishing machines that make the surface smooth enough to create the nanometer sized features that become semiconductors.  Wafer probing machines that do functional testing, dicing machines that slice the wafer into the single chips, wire bonding the bare die into lead frames to we can attach the circuits.  Encapsulation, labeling, testing and packaging the final products.

The Semiconductor Industry Machinery business is estimated to be an $11B activity separate from the sale of chips.  The semiconductor equipment market is still the largest target market for motion control products and mechatronics of any market I know of.  At a close second place would be the electronic assembly machinery market  with it’s pick and place, adhesive dispensers and inspection machinery.

Interestingly, the semiconductor industry also provides trickle down technology.  Hard disk drive spindle motors require the exact same 3 phase brushless drive and control as industrial servo motors.  The difference is that the spindle motor is manufactured in quantities of tens of millions of units.  This allows disk drive manufacturers to explore the ultimate boundaries of cost reducing the technology and introducing new techniques to improve performance.  Much of this technology has migrated to the motion control industry in the way of integrated motor control chips.

The semiconductor industry is now made up of two major markets.  Chips and Solar Cells. The solar cell market is counted separately and does not overlap with traditional semiconductor business.  Many of the companies that make semiconductor machinery have extended their capabilities to the solar industry as a way of diversifying into new markets and making up the lost ground that was experienced in the machinery business.

While Solar is still an emerging industry to some extent, it will continue to drive large segments of the economy. Solar photovoltaics and solar hot water drive a lot of jobs in manufacturing and installation of systems.

What we need in the public policy sector is better understanding of the business needs that these industries require.  Generating enough electricity for these industries to thrive is one requirement.  And most states in the US have failed to bring any new capacity on line over the last 30 years. States that recognize these needs and are willing to meet them are going to be the States that prosper with low unemployment and thriving economies.  And that’s where we all want to be.

Mechatronic Tips

The contrast between InterSolar 2010 and 2008 was very noticeable.  This year’s trade show reflected the growth and sophistication.  Tremendous effort is being put into every aspect of the photovoltaic technology, tandem junction semiconductors that produce the photovoltaic effect at 2 different light frequencies, enhanced surface texturing of the surface glass to improve transmission of light and reduce the problem of incident angle of light, new chemistries like Copper-Indium based photovoltaics which are now “printable” as ink coatings, and ongoing development of thin film silicon, concentrated light focusing on silicon, recycling of the silicon itself, and a host of improvements all targeted at reducing the cost of producing electricity from sunlight.  As you might expect, incredible support from semiconductor equipment makers to provide new equipment to make the technology scalable in production and cost effective in the marketplace.  Solar is the new growth engine in semiconductor equipment.

Solar Panels, like other types of semiconductors, are subject to decreasing cost with increasing volume.  In typical Semiconductor Industry fashion, a lot of capacity has been ramping up since early 2000 which led to a 40% correction (read “drop”) in the price of solar panels during 2009 which played havoc with project bids and created serious difficulties for distributors with inventories or contracts for solar panels at the higher prices of early 2009.  However, now that prices are lower, more demand is expected, and hopefully, companies that had a tough time during 2008-2009 will find business conditions in 2010 and 2011 more favorable.

There is continued optimism that the US solar market will continue to grow at 30%+ per year for the next couple of years, some forecasts are 50% per year and one forecast from Europe suggests 100% growth in the US market next year.  Huge growth forecasts combined with caution on the manufacturing side has created shortages and long lead times for new deliveries.

But we should note, with caution, that this market is largely subsidized by State Renewable Energy Portfolios mandating the alternative energy systems, Utility Company Rebates and Federal Tax Incentives.  Solar energy technology is generally sold on the basis of avoiding future increases in energy costs, not on the basis of eliminating energy costs.

So there is still a big gap in bringing electricity costs down using solar power.  Modern coal plants produce electricity that the utility company can sell at a profit for 6 cents per kilowatt/hour.  By comparison, a 300 watt solar panel will cost at least $1500 installed and functioning.  It can only produce about 756 kilowatt hours per year, and even at 12 cents per kilowatt/hour, won’t break even for about 16 years without government incentives.  So you’re not eliminating your electric bill, you’re prepaying it with a bank loan for a bunch of equipment that doesn’t burn coal.

That’s OK if you can afford it, just don’t make the mistake of thinking you are getting rid of your electric bill.   But be on the lookout for the next breakthroughs in solar.  They are coming.

Mechatronic Tips

One report indicated that the $2 billion would be funded as part of the scheduled $863 billion stimulus fund already appropriate by congress.  Another report indicated that the funds would be provided as loans.  There is a huge difference between the two, and the fact that the various reports are not clear on this point is very curious.

As a sidebar, I guess this is the new style of legislation.  The government passes a law first and decides what it means later.

$400 million is provided as a loan (or loan guarantee) to assist Abound Solar to add 2 major manufacturing facilities and new product lines for the company.  One facility in Indiana will be built from an existing automotive plant that will be re-tooled for solar manufacturing.  The company is expected to add several hundred new production jobs.

Abengoa Solar of Spain, which has operations in the United States will be receiving $1.45 billion, although it is not clear if the money is a loan or a grant.  And while Abengoa has operations in the US and has an excellent reputation as a contractor of large energy projects, it seems very peculiar to be giving money to a foreign entity.

This leads to a couple of really important questions about American energy policy.

From the standpoint of cost effectiveness, if you take the $1.45 billion for Abengoa and divide it by the 1500 projected jobs, the cash cost of each job is over $966,000,  per position.   It would be the same as paying $96,000 to each employee for 10 years.  This has to be the most ineffective use of public funds imaginable.

The other public policy question which has come up before is, why are US taxpayer funds being given to foreign companies?  Major green energy projects in every sector are being built by foreign companies with US government funding.   There needs to be a “Buy American” clause in all this pork barrel spending.  If these are loans, or loan guarantees, how does the government get paid back?

The corollary question for US Energy policy is why should the Federal Government be making loans or guarantees to private companies?

Fiskar Automotive, for example, has secured $500 million in loan guarantees from the DOE for it’s electric car program.  But Tesla Motors raised $2.1 billion in the private financial markets.  Does this constitute a scenario where the Federal Government is creating unfair competitive conditions by providing financial support to companies of their choosing?  And not providing similar funding to other companies.

This is also true on the larger scale.  As the Federal government continues to direct where the majority of US research and development funds will be spent, the process itself disconnects the efforts of the research community from the potential economic benefit that the research should be targeting.

The goal of all research is to produce a benefit.  And the benefit must be weighed in the context of economic utility.  When the development of technology is subjected to bureaucratic decision making, it is dissociated from the decision making process of economic benefit.

This will result in massive waste as limited resources are put into projects with poor return in value.  We appear to have entered a period of time where the process of free market decisions are being circumvented, and everything is to be decided by government.

Because, after all, these folks are professionals at spending your money and they know better than you, or the market, what is most important.

Mechatronic Tips

And the two motions are essentially simultaneous.  Yes, we only see the azimuth motion because it is the daily motion of the panel.  But the angle of elevation has to be mechanically available at the same time so that the annual change of the sun’s angle to the earth can be adjusted.  You could probably get by with this one by going out and mechanically adjusting it 4 times a year, and it would work fine.  It’s just an extra hassle, and if you’re going to bother doing tracking it might as well be good tracking.

Here’s the reason tracking is so important.  The National Renewable Energy Lab says that dual axis tracking can add up to 36% to the energy harvest of photovoltaic panels.  That’s a big number.  It’s a bigger number than anything that is in the lab dealing with the fundamental efficiency of the energy conversion process.

Because tracking the sun has such a big impact on energy harvest, it gets attention.  There are about 20 companies and tracking systems around the world.  There are all kinds of interesting solutions to the mechanical problem.  There ought to be a prize for the best design.  Some of them are really wild.  But all of them have one thing in common.  They all move arrays of panels instead of one panel at a time.

There are two main areas of solar tracking, concentrating solar and photovoltaic panels.  Concentrating solar systems are generally arrays of mirrors that focus the sun’s energy on a target area to produce high temperatures that generate steam and turn a generator.  Large arrays of mirrors all pointed at the same spot require constant adjustment and very high precision in order to get the sun’s energy concentrated on the right spot.

In photovoltaic systems, the panels convert light to electricity directly and need to be perpendicular to the sun.  But accuracy of  +/- 1 degree is acceptable.  So in one sense, it’s not as difficult.  But 2 axes of rotation is a difficult motion problem to solve.  So there are a lot of solutions out there.

I spent some time working on this and there are several really simple solutions that are possible.  And in the process of researching all the possible solutions, we found a wide range of mechanical systems that are available.

Solid Tech Inc. is in the process of developing a cost effective solution that does 2 axis solar track on a single solar panel.  This approach serves commercial flat roof installations and residential applications increasing the total energy harvest and reducing the payback period for the system including the cost of tracking.

Stay tuned for more details.

Mechatronic Tips

Or so the story goes.

We’ve been trying to reach grid parity for some time.  Without much success.  And not because we aren’t trying.  Billions of dollars of government subsidies, R&D funding and private investment are being poured into the pursuit.

Energy independence!  Both as a Nation and as individuals.  It would be great to be able to say, personally, we don’t have pay any utility bills.

The first great fallacy is that either solar power and wind power can cause energy independence for the US.  This is because the energy we depend on is not electricity, it is Middle East Oil for gasoline.  We are dependent because of our cars and the choice to not make our own gasoline, even though we can at lower cost than importing it.

But on top of that, almost none of the electricity generated in the US uses Oil.  It’s all coal, natural gas, or nuclear.  So the idea that the US will reduce it’s foreign oil imports by generating electricity with solar power or wind power, is completely ridiculous.  There is no connection between the two.

There is a theoretical energy equivalency that can be expressed.  But there is no real connection.  So people who make this claim are intentionally misleading anyone who listens.

How are we doing with respect to the cost of electricity generated by solar power?  It’s been an interesting couple of years.  The industry experienced a brief shortage of raw silicon which kept prices fairly high.  More recently there was a precipitous drop in panel prices.

Opinions vary as to the cause of this drop, but with the massive increase in manufacturing capacity worldwide, I would guess that the price drop is strictly a matter of oversupply.

Economies of Scale will fix the problem according to some.  After all, look how well we’ve done with computers, hard drives and flat screens. Flat screens that were $10,000 to $50,000 a decade ago are now affordable to the point where the CRT has become obsolete.

Since the biggest component cost of the solar panel is silicon wafer, we should expect similar results in the solar market.  The stampede to build more solar panel manufacturing plants resulted in oversupply.

Now the race continues to drive costs down.  Panels that were selling for $3.50/Watt a year ago are down to $2./Watt and prices are expected to continue to fall. And some manufacturers will not be able to keep up with falling prices using older technology.

But are we getting to grid parity?  Is Solar power cheap enough to compete with utility power?  Nope. Because even at today’s bargain pricing, a 225 Watt panel will only produce 900 kilowatt hours in a year at maximum efficiency.  At market cost for electricity, $.05/kW, it’s only $45 worth a year.  And it currently costs about $1125 pay for the panel, installation and balance of system components.  That means it will be around 25 years, the end of the useful life of the system, before it breaks even.  Yes, in California where consumers pay $.23/kW the payback is better, but it’s still very expensive to convert to solar.

We have got to do better than that.  And we will.  The technology is coming along.  But economies of scale by themselves can’t quite get us there.

Mechatronic Tips

Right now the creators can only coax minuscule amounts of electricity from their photovoltaic circuits, far too little to power consumer electrical devices, although those amounts could quickly skyrocket.  There are plenty of other ways they say that they can squeeze more electricity from light. Right now only about 10 percent of the photovoltaic circuits on a glass side work. Increasing that number will boost the power output.  Another way to get more power is by turning their 2D structures into 3D structures. Stacking multiple layers of light-collecting and electricity-using circuits would also boost power.

The photovoltaic circuit is a scientific breakthrough, not a technological one. These new circuits will most likely never replace their silicon counterparts.

Photovoltaic circuits could be ideal for other applications, however, such as powering tiny robotic devices or running computer calculations at the speed of light.  Far into the future, these circuits could even be used to set up as artificial neural networks that could model the brain.

At their most basic, computers represent data as on or off, a “0″ or a “1.” Using light instead of electrons, these photovoltaic circuits could store data from, say, one, two, three or four. Each number would correspond to a certain wavelength or color of light — red, green, blue and yellow, for example. To model the human nervous system, each color of light could correspond to a different neurotransmitter, say red for dopamine and blue for serotonin.

The potential applications of the technology are huge, but will take years to develop into any kind of practical equipment.

www.news.discovery.com

Mechatronic Tips

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.

Mechatronic Tips

I know from having lived in Colorado that there is a lot going on there because there are 300 sunny days a year, so it’s a great place for solar power projects.  Many businesses like the Whole Foods company and other large retailers have projects going on and the Federal Center is putting in major solar power arrays to reduce their electrical demand .  The National Renewable Energy Labs are in Golden Colorado, near Denver, and they have huge campuses with thousands of people working on all sorts of energy related topics.  Public Service, the local power company has major wind farm projects going on in the state.   And there are major wind testing facilities that have recently sprung up to support the wind industry in Colorado.

So as part of measuring the impact of Renerwable Energy and Energy Efficiency activities, the report from the American Solar Energy Society focuses quite a bit on the local Colorado situation.  I have heard that Colorado claims to have 10,000 new jobs in the renewable energy arena.  There is a long way to go to get from 10,000 jobs to 37 million.  More importantly, the report states that  5600 of those jobs are at NREL and other government or non-profit organization, like ASEA.  I don’t think you can count jobs that are paid for with taxes, they don’t produce revenue.

The methodology of the report includes under it’s definition of Renewable Energy category of business; wind, photovoltaic, solar thermal, hydroelectric, geothermal, biomass (ethanol, biodiesel, biomass power), fuel cells and hydrogen.   That’s pretty broad by itself.

Then the Energy Efficiency businesses include; appliance, HVAC, insulation, automobile and other.  So on a statistical basis some of the appliance and HVAC businesses, which already exist, get counted for a certain amount of head count and revenue generated because portions of their product sales focus on energy efficiency.  Wow!  That means you can count a small percentage of almost everything else.  Personally, I don’t consider guys putting insulation into your home part of the emerging green economy.  But the folks at ASES do.

And jobs that are federal, state or local government that are related to renewable energy are counted as well.  Non-profits, trade associations, foundations, consultants, investment, and other related positions are all in the count if they are related to Renewable Energy or Energy Efficiency.

So there is a huge gap between estimating the “impact” of the green economy and job creation based on the green economy.  Looking at the report from ASEA, they are clearly not the same thing.  If 56% of measured jobs in Revewable Energy in Colorado are in the government and non-manufacturing roles, then the claims for job creation can not be more that 4400.  And the size of the “green” job creation opportunity is significantly lower than the announcement would lead you to believe.

Worse still for the US economy, one of the dominant suppliers in wind power is Siemens, which means that a lot of the sales generated here, translates to revenue for Europe.  In the solar cell market Japan, Germany and China supply the majority of the market and several foreign suppliers have operations in the US.

We sure hear a lot about how the green economy is going save our economy.  I think some of the messages are exaggerated and taken out of their proper context.  The analysis needs to be based in terms of what we can really expect in Growth.

Mechatronic Tips

In an effort to check the facts, I visited the American Wind Energy Association website.  There is a brief article (www.awea.org/pubs/factsheets/EconomicsOfWind-Feb2005.pdf)  that goes into some detail on the costs of large wind projects.  I used some of that information for a reality check.  They put a utility scale project analysis in the article that starts with a 50 MW capacity.  They say that a project this size would probably cost around $65 million to install.  I put in the recently published national average $1.93 million dollars per megawatt and got $96 million, a whole lot more expensive.

If the turbines are located on a site with wind available 35% of the time, and that’s a big number, the site should generate 150 million kilowatt hours per year.  The revenue will be around $6 to $6.75 million dollars a year not including maintenance, property taxes, management costs, etc.  Best case, the project will break even in about 10 or 11 years.  Worst case, 15 or more. Don’t know if the life expectancy of the equipment is 20 or 25 years.  I’ll check into that.

And by the way, medium size photovoltaic projects operate on about the same basis.  They are too expensive to make it worthwhile to take your home off the grid.  So the DOE’s “Million Roofs on Solar” project is doomed.  You can legislate a program, but you can’t make it work unless it pays for itself.  And the government doesn’t have enough money to pay for it for you.

These are really big numbers to be tossing around, and it makes me uncomfortable that the mainstream press doesn’t report on the facts.  Maybe that’s too much to ask.  It is a somewhat technical subject.

OK.  Here’s the real point.  The projects have many financial incentives like State and Federal subsidies, accelerated depreciation and investment tax credits helping to subsidize the costs.  That’s how we get to payback periods of 6 to 8 years.    So my math was wrong, but the final results are as represented.

When politicians make policy without facts, it comes out wrong.  Wind is great.  I am an avid wind energy enthusiast.  But we cannot create these massive alternative energy industries with billions of dollars of commerce that require government subsidies in order to operate.

I have done some numerical analysis of the wind energy problem and there are solutions that will result in 2 year paybacks for investors.  We need more innovation that integrates financial responsibility in the equation.  This is the kind of engineering that is self sustaining and will result in new jobs without government subsidies.

Mechatronic Tips

The efficiency rating of a wind generator is not related to the equipment, but rather to the average wind speed and number of hours out of a year’s time that the system is generating power.  So this number can vary quite a bit, and of course, the generated electricity varies with the wind.  So a lot of effort is put into the site survey to determine if a particular location can generate enough power to pay back the cost of the equipment.

At 30% efficiency the average power generated is 300kW.  This is enough electricity to power 231 homes if the homes are all using about 1300 kWh per month.  Personally, I have not been able to get my power usage under 200kWh per month, so it might be many less homes in actual practice, but you get the idea.  If you are paying 11.5 cents per kilowatt hour that’s only $149 per month in electricity.  So the revenue for 1 megawatt of capacity is $34,535 per month.  And since a wind farm has operating costs, usually estimated at 10%, the revenue minus operating cost is $31,082.  To pay off that $1.93 million invested will take 62 months.  Sure, it will go a lot quicker if the electricity rate is high like in California.  But it looks like everyone is making money at this alternative energy stuff except the consumer.

Texas has very low energy costs to begin with, and solar power has slightly lower net efficiency than wind power due to the number of hours of daylight, the number of days of sunshine, etc.  So the local utility has begun suggesting to customers that because of expensive investments in wind and solar alternative energy systems, that we (the customers) will have to pay increasing rates for power to “help shoulder the costs”.   Really?  I thought all this alternative energy stuff was going to lower our costs.

I’m not a financial genius, but I can tell there’s a problem.  Especially when no one in the alternative energy industry ever talks about return on investment. We have to focus on technology that has better financial performance.  And I think it’s out there, and my company is working on some of the solutions.  We’re just stuck behind the slow moving giants of the industry who are dominating the landscape.  It’s time for some of that Yankee Ingenuity to come to the forefront.

Mechatronic Tips

We all share the concern that unemployment is up and many areas of the economy are slow.  But let’s be sure that when the government says its going to spend our money, that the decisions are based on sound strategy.  Maybe government spending money that it doesn’t currently have isn’t such a great idea.

Is the technology being evaluated on the cost per kilowatt hour?  Or are other metrics being used for evaluation?

In the solar energy field, what is the opportunity to generate electricity on the flat roof of buildings?  If we look at the number of photovoltaic panels that can be put on a roof, its a big number.  But if the panels cost $550. each and they are 11.625 square feet, it is going to cost $47./square foot to pay for the panels not including installation labor and materials.  That’s a lot of money.

If its a high quality PV panel at 210 Watts of output, it produces 18 Watts per square foot.  With the number of square feet of roof available, we could generate enough electricity to (fill in the blank with whatever you dream about that you think will save the world).  This is where the politically savvy get you to agree with them, even though they may not know what they are talking about.  They link the program they are selling to your hopes and dreams to get you to buy into the deal.

If we could put solar trackers to follow the sun, we would be able to increase the total output of the solar cells by 30% or more.  (That data comes from the National Renewable Energy Laboratory, and they should know).  Tracking panels cast shadows, so you can’t use 100% of the square footage on the roof for panels.  So some may argue that solar trackers will destroy our hopes of energy independence by decreasing the number of panels that can be installed on rooftops.  (Watts per square foot).

But 30% increase in available power means we can either produce more power, or produce the same power as before with less panels.  Less panels means less dollar$ per kilowatt.  Less cost means quicker return on investment.

Ask how much it costs.  Make sure you get an answer.  When does the system pay for itself?  Make sure you get an answer. If the thing is going to be financed with tax dollars, who owns it?  If we paid for it with tax dollars, shouldn’t we get the energy for free?  Which calculation makes sense?

Mechatronic Tips