« The 1/1/2020 Article | Main

Comments

Geoman

Just got back from a guidance meeting today for our subdivision. 5 solar contractors biding for our homes, promising bulk cost reductions (around 10%) depending on how many houses sign up. Whole system costs around $12k installed, with a 10 year payback and a 25 year warranty, and includes the federal tax rebate. About $2.90 a watt. Power costs are $0.20 kwh locally.

My contribution to the selection committee was to make sure people were NOT doing this to save the environment. If you want to save the world you can spend your money lots of ways. Do this because it simply makes good economic sense.

I live at high latitude, so I can power my house entirely around three months a year. Unfortunately, there are several months a year where my output would be essentially zero. Still and all, savings are around $1,200 a year.

Drew

This will be one of those quietly accepted singularity advances, like of course you have an always on the internet computer in your pocket.

Kartik Gada

Drew,

Perhaps even more so, since most people won't even actually see the Solar farms.

Plus, the biggest effects are in tropical countries that were trapped into having to import oil. Replacing imported oil, for them, has a huge multiplier effect.

Kartik Gada

Geoman,

My contribution to the selection committee was to make sure people were NOT doing this to save the environment. If you want to save the world you can spend your money lots of ways. Do this because it simply makes good economic sense.

Good! Environmental solutions are only really solutions if they make economic sense. Otherwise, they end up causing a worse situation than what existed before the 'solution'.

From the world map above, you can see the relative solar intensity of your location. If it makes economic sense even in your zone, then it makes sense in all zones of equal or higher sunlight.

Drew

Assuming the 25% growth rate continues, solar power should double roughly every 3 years. This leads to a 16 fold increase in solar power around 2032, when the electric car population will be in place. You can see why Exxon has slid to 8th place for the world's most valuable companies. As KG mentioned earlier, like the cell phone the difference will be biggest in poorer countries that skip the in-between steps of technology build out (gas stations, etc.). It will be a literally quiet change in wealthier countries when we stop hearing engines.

Geoman

Kartik - If it doesn't make economic sense it won't happen. Not at a scale that makes any difference.

Honestly I have been holding out for the Tesla solar shingles. The idea being that the cost of the solar is a bonus to replacing your roof - any time you re-roof you just choose solar shingles over regular shingles for a very small premium. But I figure I'll do the panels now and add the solar shingles later. Most of the wiring stuff will be done by then anyway. I might get 6 months a year free power that way. Heck, add an electric car and I might be driving for free.

"Exxon has slid to 8th place for the world's most valuable companies."

That slide is attributable to much more than just solar. Really it is fracking. I just can't overemphasize the change that has happened in the last 10 years due to fracking. Our supply of hydrocarbons at a price >$80 is essentially infinite. We will never run out. I've seen estimates that are literally off the charts - hundreds of years of demand. Don't believe me - look at what has happened with Russia, Iran, Venezuela, and Libya. For various reasons there have been huge real and threatened disruptions in supply. Yet prices have remained relatively stable worldwide - between $40 to $80 per barrel. Why? Because fracking means any single supplier can be easily replaced.

Fracking has really only taken off in one country (the U.S.), in a few areas (Texas, North Dakota, and Pennsylvania). California and New York have huge untapped shale resources. Also Michigan and other states. The U.S. tapped it's shale, and not even all of it, yet it changed the world. I recently read an article where shale plays in Namibia dwarf the U.S. As they do in China, Russia, Poland, the middle east, Argentina...there is no incentive now to develop those resources, but if the U.S. ever runs low on shale resources, there are huge new resources to tap in other countries.

I tell people, think about all the oil and gas deposits we have ever produced in the history of Earth. Now imagine we have 2-3 other entire Earth's with exactly the same amount of resources left to tap. It is that much more shale brings to the table.

64% of our oil usage in the U.S. goes to transportation, mostly cars. Imagine a 30% cut in overall oil demand. Electric cars have the potential to very rapidly cause that to happen.

Big oil companies - think of them as big capital accumulators. They were necessary to tap increasing remote and difficult to develop sources of oil. Shale plays, for now at least, have been easy to develop. In Texas they are in already developed oil fields with fully depreciated infrastructure in place. Development costs were very low, making Exxon's massive overhead a detriment - most of the shale development was by small agile low overhead companies.

Once the easy shale is used up in 10-20 years, long term shale plays may require the behemoths like Exxon to get involved, but long term we might see oil demand falling due to electric cars. So there really is no function for the big oil giants right now.

Our recent confrontation with Iran was a huge wake up call. Oil, as a weapon, is dead. The bluff has been successfully called. Close the Straight of Hormuz? Okay. So do it. Go ahead. You'll just make the U.S. richer, accelerate shale development, and even more rapidly expand the market for electric cars. Each result is to Iran's detriment, and cannot be reversed once they occur.

Weirdly I think this change will help many of the countries of the middle east. Many have had socialistic economies and totalitarian governments where oil profits have papered over economic failures. That won't be possible going forward.

Drew

I agree with your description of the big oil companies as capital accumulators (and capital managers) and that role not being needed now in that part of the energy field. Which makes me wonder in what other fields (banking?) that may soon be true. In Ben Thompson's Stratechery blog he talks about Aggregators - who "collect a critical mass of users and leverage access to those users to extract value from suppliers" - Examples are Google, Facebook, Amazon, etc. They are accumulators and managers of relationship capital. Also thanks for the reminder that the oil infrastructure was already in place in Texas, so it isn't just geology and regulatory regime that makes it such a leader in fracking.

Kartik Gada

Geoman,

64% of our oil usage in the U.S. goes to transportation, mostly cars. Imagine a 30% cut in overall oil demand. Electric cars have the potential to very rapidly cause that to happen.

Not just that, but about 15% of oil is used just in the extraction, transportation, and refinement of oil. Hence, even small reductions in demand have a cascade effect.

Our recent confrontation with Iran was a huge wake up call. Oil, as a weapon, is dead. The bluff has been successfully called.

Twice, in the last few months, was over 5% of world oil supply disrupted. And both times, there was virtually zero effect on oil prices and the stock market. The same event prior to 2015 would have caused oil to rise from $100 to $130. Instead, nothing happened.

Geoman

Oil prices are the dog that didn't bark. To paraphrase Sherlock Holmes.

It is funny - we have lived in a certain mindset so long...it is hard for people to fathom the sheer depth of the change. The middle east really doesn't matter all that much to us in the West. No more than any other part of the world.

Utilities and cities need to wake up - every parking meter/public parking slot could be a charging station. The city makes money off the parking AND the charging. Every electrical substation could have a place to charge up - easy money. There is no reason the charging stations need to be on street corners.

Gas stations will hang around for decades, just getting slowly fewer and further between.

HB


I have to admit that I installed solar panels on my house all the way back in 2003. Not because they were that efficient at the time. Not because I wanted to save the world. But because they were free. Back in 2003 naive California voters paid me $4.20 per watt in subsidies. They just could not wait for more efficient panels another 15 years to save the post-singularity world from 2C of warming. By doing the not so difficult installation myself the entire system was essentially free to me though it costed California tax sheep almost $12,000. Did the subsidies accelerate the technological development? Probably by a small amount. Did they distort the overall progression of the ATOM? Most likely yes, thus net effect was most likely negative like most top-down technological development directives.

Geoman,

Oil could still be absorbed by other uses (eg plastics and aviation) which are now being crowded out by transportation. I don’t have much insight into the elasticity of oil demand outside the transportation sector. There may also still be sizable use for hydrocarbon in transportation, though I suspect that in pitchfork style democracies (US is converging more and more towards that model too) once gasoline cars become a minority there will be an effort to ban them. That may push oil use to other freer locales.

Finally, I get the impression you all seem to be discounting hydrogen as a fuel? Why is that? Is it because chemical energy seems so passé? All electric cars today essentially still store their energy in chemical form in the lithium ions.

Geoman

Your solar story is too funny. I have friends in California who did the same thing - laughing all the way to the bank. Suckers.

I look at oil as % usage. In the U.S. 70% is transportation. Gasoline is 45%. Another 15-20% is diesel. The rest (5%) is planes and trains and ships.

Plastics are maybe 4% of the total usage. A 25% increase in plastic production results in only a 1% increase in oil used.

Hydrogen has loads of problems that don't get talked about much. The easiest way to make it is from natural gas, which doesn't really solve your global warming problem. So why bother? In fact, natural gas is a much better energy carrier than hydrogen - more stable, easier to handle. Why not just convert cars to natural gas and skip the middle man?

Hydrogen can also be made from splitting water - but that is a very energy hungry process.

The biggest problem with hydrogen is the hydrogen itself. It is a very small atom, meaning it can escape even the tightest confinement through the smallest holes. It can actually seep through certain solid metals. It is also not very compressible, meaning it is hard to store a lot in a tank. It is absurdly hard to do refills. You'll never get more than 100 miles of range out of hydrogen cars for this reason. New rockets (Space x, Blue origin) are moving away from hydrogen/oxygen reactions toward methane/oxygen for this very same reason - they get less power, but methane is so much easier to handle.

Anyway, you start stacking up all the negatives, and you realize batteries, which ultimately can be charged at your home, are a much better option.

Ask yourself this - why don't they take wind and solar power, use it to split water, store the hydrogen, then pass it back through a fuel cell? That way they could make the renewable energy dispatchable.
Because it is monstrously expensive and inefficient. Doing the same exact thing, but running a car, works out to the same incredibly low efficiencies. Alternately storing that renewable power in a battery results in multiple times greater efficiency and much lower cost.

Of hydrogen cars Elon Musk has said "Success is simply not possible." they are only about 1/3 as efficient as electric vehicles - and that ratio is pretty much baked into the laws of physics.

Kartik Gada

Geoman,

Anyway, you start stacking up all the negatives, and you realize batteries, which ultimately can be charged at your home, are a much better option.

Indeed. It is only a matter of time, even though the US will be a laggard in EV adoption.

Gas stations have already fallen by half since the 1980s, and gas stations occupy prime land.

Even if charging takes 20 minutes, that is fine, as the charging stations just have to partner up with Starbucks, Peet's, and grocery stores. It is always going to much more decentralized than gas stations.

To me, the fact that 15% of oil is used just in the extraction and transportation of oil itself is the obvious red flag.

Home charging is just obvious. This is one of the many reasons hydrogen was never really an option.

Parking lots at work will also have charging, especially at tech companies. This will become a very standard perk.

Lastly, note that the increase in electricity consumption from EVs will not overload the grid (or save PG&E), despite what some clods think, since the reduction in electricity usage from LED bulbs has already more than offset that.

In CA, 5-6% of new cars sold are EVs, so let's see.

Geoman

"Parking lots at work will also have charging, especially at tech companies. This will become a very standard perk."

Exactly. Roof over the parking lot and cover it with panels. Keep the snow and rain off, keeps the car cooler. It doesn't even have to be free, charge say, half the going rate, maybe $0.07/kwh. Then all the upgrades (the roofing and panels) pay for themselves. It can cost the company nothing in the end to add the perk.

"Lastly, note that the increase in electricity consumption from EVs will not overload the grid (or save PG&E), despite what some clods think, since the reduction in electricity usage from LED bulbs has already more than offset that."

Electrical usage at night goes is about HALF what the grid is designed to deliver. That is a lot of slack in the line. All you have to do is cut the rate between midnight and 7 AM to encourage people to use the timer function for charging, problem solved.

And this actually helps utilities - ideally you want your large capital assets used to the maximum degree. The more they sell, the cheaper each unit of energy can become, and the more money they make. Everyone wins.

Eventually we'll need more generation...but an awful lot of EVs need to be on the road before that happens. We have at least 10 years...maybe much longer.

HB

“Hydrogen can also be made from splitting water - but that is a very energy hungry process.“

I thought it was just as hungry as storing the energy as chemical energy in the battery. I think it’s from hydrogen back to electricity that the efficiency is only 40-60%, compared to batteries where around 97% of the energy is retrieved as electricity. A fuel cell is essentially a battery with hydrogen fuel as opposed to the lithium ion fuel, albeit with lower efficiency apparently. Charging is almost instant though. I wonder if we might find a way to just quickly transfer lithium ions back into the batteries some day, or a fast battery swap. Indeed if recharging time becomes around 15’ then it will be almost negligent.

Fatcat

Slow charging times for EVs can be solved with standardized swappable batteries. The problem is that this requires a network effect or huge initial investment. If an EV car has part of it's batteries as a swappable unit, your charging time can be as short as filling up a gas tank. That would work fine for city buses with fixed short route. What doesn't work well is to leave an expensive car/bus/truck charging for a few hours during business hours. There was an attempt like that in Israel but it failed due to poor adoption. I hope that failure wasn't due to an inherent problem to this approach but rather done bad business decisions.

Fatcat

@HB
there are flaw batteries. You can drain and change the electrolyte. But to use it on cars you have to find a clever way to plug and secure the pipes that will drain and poor the corrosive liquid. And to make sure some stupid human doesn't contaminate the electrolyte. Could be useful in controlled environment like utility veggies l vehicles of a factory on an airport. The price might be step, though...

Kartik Gada

Again, I cannot emphasize enough how valuable it is for poorer countries (including China) to be less dependent on imported oil.

Oil has a single worldwide price (Brent Oil), and hence a poor country does not get any Purchase Power Parity effect at all. Many of the average people in poor countries can barely afford to consume even a single barrel of oil a year, especially when oil was $100. By contrast, electricity has elements of local (PPP) pricing, and even more so for Solar, which, as I mentioned, works better in tropical countries anyway.

Many countries have paid for their own enslavement. Many Pakistanis and Bangladeshis work in Gulf petrostates as near-slave labor, *because* their home countries have great poverty partly caused by the crushing cost of oil imports. China, too, kept the one-child policy going longer than it wanted to because of the crushing cost of importing oil.

Geoman

Of all the forms of slavery, energy slavery is the most pernicious.

But there are no bad peoples, no bad countries. Any country can be a raging success. There are only bad governments, and to some extent, bad cultures. For most countries bad government policies make all the observable difference in outcomes. We've run this experiment numerous times - identical countries, with identical people, coming to vastly different outcomes due to bad government. It always comes down to one thing - government interfering in the economy, and not doing the things it was meant to do, like enforcing laws and contracts.

7,348.7 MW. That is how much hydro power is currently under construction in Pakistan. That will all come on line in the next 5 years, much of it in the next 2 years. Their total demand is 33,000 MW. So they are adding 20% more electricity in the next 5 years - hydrocarbon free. Of course they'll be paying the Chinese for that power for the next 30 years....

For a Tesla, you can plug it into a standard socket and get 30 miles of range per night - enough to top off for most morning commutes. Using a 240 socket, you can get a full charge each night. A supercharger gives you full range in an hour. They are working on faster recharge, but so far, less than 10% of the charging for Teslas happens outside the home. So the charging infrastructure doesn't matter all that much. I suspect they'll just be chargers ...everywhere. Everywhere you park a car will be a place to hook into the grid. You will always be "topping up". Then it just won't matter - no need for battery swaps and charging time won't matter.

Heck, the tesla cyber truck is proposing to have solar panels in the bed cover, which automatically add 15 miles of range each day. The light year one promises 30 miles a day in sunny weather from solar panels embedded in the hood and roof.

Kartik Gada

Geoman,

I suspect they'll just be chargers ...everywhere. Everywhere you park a car will be a place to hook into the grid.

True, but remember that parking spaces themselves will be greatly reduced, as per our 2032 vision. A lot fewer cars, all self-driving Ubers, and hence only parked long enough to charge.

Massive strip mall parking lots will be totally gone.

But once overnight charging is enough for a full day's charge, that is plenty.

Kartik Gada

Geoman,

The jump in battery efficiency might cause a major rise in EV sales, as we have discussed before. This greatly curbs oil consumption in countries that import oil.

Add solar to the mix, and the worst days for oil may be yet to come.

Recall an earlier ATOM AotM, where I said that commericial/govt vehicles are the inflection point. There are 800,000 police cars, 210,000 USPS vans, etc.

Geoman

But we are past the point where battery efficiency matters that much - they are certainly efficient enough. A 400 mile range is better than 300 mile, but both are more than sufficient for most people. I think anything over 200 miles or so is just a bonus.

I think electric police cars and delivery trucks will be the next big thing. Just think of all the maintenance costs that will be saved by using a vehicle with only a small fraction of the parts, and built in computers that tell you precisely what the problem is.

One great advantage of EV car makers, especially Tesla, is they can sell their batteries separately for home, or even utility scale storage projects, without much modification. Tesla is also working out how to stamp the entire car body out of one sheet of metal. fewer parts means more automation is possible, shorter supply chains, easier repairs...Tesla is trying to build a car that will drive 1 million miles with minimal maintenance. It sounds crazy, but electric equipment, designed well, basically lasts forever.

On a gas powered car what usually fails? I'd say, seals cause most failures. Seals leak fluids, then you get metal on metal, overheating, and failure. What if you had a car with no seals, and no fluids? No gas, oil, or antifreeze? No transmission fluid, no power steering fluid? You vastly reduce the pathways to failure.

Kartik Gada

The multiplier effect of Energy slavery is very high.

The uniformity of batteries across more than one use is a crucial element of mass-adoption, but is also an ATOM disruption, as it lowers all associated costs.

The fact that EVs may last 500,000 miles is another thing that will force usage into self-driving Ubers instead of private ownership (by 2032).

Getting back to solar, this is, in dollar terms, the single biggest ATOM disruption of our time is this. Entire percentage points of world electricity demand are shifting to Solar, on top of the bias towards this generation being in tropical (i.e. poorer latitudes).

HB


That type of auto-mobility looks like a bright future. Consistent with the long term fantastic future most of us on these pages see for ourselves and our descendants.

For me the electric car will become a choice when its recharging time is an easy 30’ anywhere there is a gas station today, batteries last over 200k miles without degradation and the entire car costs 30k. To me that is the parity point. I happen to not care whether I can get 0-60mph in 12 or 2 seconds. Until then, I’d like to retain the choice to spend the money I earn propelling humanity towards its exponential growth in whatever way I choose. And I’d like to leave things unimpeded for other technologies to even leapfrog and disrupt the electric cars which are now becoming conventional disruptors.

That parity point may or may not happen, soon or later. As I have said before, just because overall human advancement is rather consistently exponential, does not mean that every pocket of technology and micro trend flows some sort of Moore’s law. The enduring winning technologies ultimately prove themselves in the open market, without mandates, subsidies, punitive taxes on competition, politics and grand five year collective government plans. And these innovations are made by motivated people, not people pigeonholed and conscripted in the central planning mandates of a neo-authoritarian ecological planet, working half their lives just to repay a 1945 1400sqf wreck house in San Francisco in the name of “saving the hills”. They paint the flags green and they’re no longer swastikas. How easily are they tricked — once again.

In spite of the wonderful technology, most of the talk about these automations is politics, and increasingly so. Politics, central planning and mandates, on behalf of people who cannot — just cannot — control their innate desire to a centrally planned self-righteous centrally planned planet. They just cannot let technologies mature in a free open market, lest we suffer another half, oh terrible, degree of warming in our post-singularity future. That is pathetic and precipitates a great antipathy towards moralistic electrification mandates and the like.

Verify your Comment

Previewing your Comment

This is only a preview. Your comment has not yet been posted.

Working...
Your comment could not be posted. Error type:
Your comment has been posted. Post another comment

The letters and numbers you entered did not match the image. Please try again.

As a final step before posting your comment, enter the letters and numbers you see in the image below. This prevents automated programs from posting comments.

Having trouble reading this image? View an alternate.

Working...

Post a comment

Your Information

(Name and email address are required. Email address will not be displayed with the comment.)