Road Runner

Grid Connectivity: Invest in Alternative Energy's Missing Link

TinyTim, I agree with you on the US market. I doubt HDVC will be big in the US because of strong NIMBY, and because there is little need to transmit electricity underwater where HDVC is mandatory, and because intercity solar (homes, business roofs and parking lots) will be giant in the southwest US where electricity rates are high, and we have lots of natural gas for gas-fired plants. I wouldn't recommend ABB if I was only focused on the US market.

But, where ABB will do well is the rest of the world as I discussed in my previous post. The rest of the world is going to build many HVDC lines. And, the emerging markets that need to build their whole electric grids are going to use all the other electrical products that ABB produces.

Grid Connectivity: Invest in Alternative Energy's Missing Link

Though I'm a big believer in home solar - it will be huge - I don't believe that home solar will come close to meeting all of the electrical energy needs of the future.

First, the energy needs of the future will be much larger while oil is becoming scarcer. No one renewable energy source can keep up with it, even home solar which I think will explode in use starting in about 10 years.

Second, there are many areas where the sunshine is poor like the North, and many areas that are densely populated, unlike the urban sprawl cities of the southwestern US.

Also, I am skeptical of home wind as a large component because I have not yet seen an economical, non-obstructive home wind system. My opinion may change if I see a very promising system.

And, electrical grid improvements are needed for many reasons besides power from wind and solar farms. China is building HVDC lines in a fury just to move power from the hydro dams. www.desertec-australia... One of the largest HVDC lines in the world was just completed to carry the hydro power from Norway to the Netherlands. pepei.pennnet.com/disp... There is also proposals to link the many islands of southeast Asia with HVDC cables. www.desertec-australia...


On Sep 08 06:01 AM jerrydd wrote:
>
> While an OK investment, it will probably bubble in a yr or two because
> of over hype.
>
> The facts are RE is going to be home grown. By that I mean the distant
> solar/wind farm is not a very good business model. Vs home size which
> is the real RE future.
>
> Home size wind, solar CSP not only doesn't have land, transmission
> line, overhead or stockholders but make 50-100% more income in saving
> or power sales than farms do. Thus shorter payback and they last
> 50+ yrs. These are simple machines that in real mass production will
> easy be the low cost energy source.

Why I'm Long Uranium and Nuclear / Power Engineering

Seems to me that if a friendly country like Canada has such good reserves of Uranium, that the US should be pursuing some growth in nuclear power.

I don't want to see a huge push for nuclear because of the huge upfront cost (about $10 billion per plant) and large lead time (about 10 years) for nuclear power. Though, new types of nuclear reactors in development may change these numbers which would be very positive for the industry.

Some places with a very high population density and poor profile for solar, like the Northeast US, should pursue nuclear at a modest rate. I would not want to see a utility be aggressive in developing nuclear because the high up-front cost and long lead time could lead to another financial crisis like the Bonneville Power debacle of 1983.

Also, in places where the solar profile is very good, like the Southwest, there is the potential for a disruptive drop electricity generating requirements due to solar. In 10 years, solar will be at or below grid cost, without government subsidies, for the Southwest. Battery technology will also be such by then that solar could be used for base load. Solar will become popular not from government sponsorship, which almost always leads to slow development, but at the “grass roots” by individuals and businesses adding solar for economic reasons.

I’m not saying solar will replace everything in a short period. It will take decades to make a large impact. I’m just saying that aggressive pursuit of nuclear in the Southwest could lead to a financial crisis for utilities and/or governments.

Why I'm Long Uranium and Nuclear / Power Engineering

Thanks EDYF for the informative response.

Why I'm Long Uranium and Nuclear / Power Engineering

I second bigeasy8's question about "peak uranium". Are we going to reach "peak uranium" in the next 50 years or not? I heard that if the world went fully ahead with nuclear power that there would only be about 30 years of Uranium left in the world. Is this accurate?

Investing in the Smart Grid

optionsgirl, I like ABB too. It is heavily involved in HVDC (high voltage direct current). This is the technology that I talked about above.

Investing in the Smart Grid

Here's the fixed links for my post above.

en.wikipedia.org/wiki/...

www.renewableenergywor...

pepei.pennnet.com/disp...

www.desertec-australia...

www.desertec-australia...

Investing in the Smart Grid

C300man said, “One factor that is missing from the discussion is the cost and energy required to transmit electrical energy long distances. That is the reason generation facilities need to be located as close as practical to where the energy is used. Otherwise much energy is lost in the long-distance transmission.”.

This is not accurate. HVDC (high voltage direct current) transmission lines are very efficient over very long distance. They are an established technology in use today. As stated below, a cable of 360 miles can have a loss of only 4%.

Here is a cut-and-paste of my post from another blog.

The solution for moving the power of remote wind (and solar) farms to the cities is high voltage direct current (HVDC) transmission. en.wikipedia.org/wiki/... . The established HVDC technology is more efficient than high voltage alternating current (HVAC) at distances of over 600km (373 miles). This is because the HVDC transmission line cost is lower than HVAC, but the convertor (AC to DC) and inverter (DC to AC) costs of HVDC are high but fixed. However, the new HVDC Lite from ABB and HVDC Plus from Siemens has reduced this efficiency crossover distance dramatically by using advanced and cheaper electronics in the convertors and invertors.

Another advantage of HVDC is the cables can be buried along highways. renewableenergywor... . Gone are the ugly towers and the “not in my backyard” problem.

As noted in the article linked above, there is a HVDC line running today that carries electricity from Utah to Los Angeles, about 500 miles. There is a proposal to extend it into southern Wyoming for wind farms.

The NorNed HVDC link, an underwater power cable from Norway to the Netherlands, just came online in May of 2008, and is proving to be a big success.

pepei.pennnet.com/disp...

Here are some highlights about the cable.

The NorNed HVDC link has a maximum capacity of 700 MW and an operating current of 824 A. It transfer cheap hydroelectric power from Norway to the Netherlands. The loss for the length of the cable is 4%. NorNed project is said to have cost in the region of €600 million ($760 million), and took ten years of planning and a further three years of construction. At 580 km (360 miles), the NorNed link is the longest high-voltage submarine power transmission line in the world. The FMI cable has a novel design in that it comprises two independent cable cores made of braided copper stands, each rated 450 kV DC, placed side by side into a common steel wire armour.

Here is a link that shows proposed HVDC links for Australia and southeast Asia.
desertec-australia...

The map of the planned Chinese HVDC links, desertec-australia... , is just another thing that scares me about China. China’s government is investing in the future is a very big way. Even their stimulus package was infrastructure oriented. Because of this, in my opinion, the size of their economy will catch up to the US in a much shorter period than forecast.

Thus, there is a solution today for getting energy of remote wind and solar farms to where the energy is used.

A Very Smart Plan for Federal Smart Grid Grants

John Peterson said, "a standard sized deep discharge lead-acid battery typically holds about one kWh of useful energy and costs about $200. The PbC will probably be a little larger because it uses 40% less lead per battery. The DOE pricing estimates have lead-carbon starting in the $500 per kWh range and dropping to about $250 per kWh over time.".

John, if the price of a lead-carbon is not going to be less per kWh than deep discharge lead-acid, then what is the advantage of lead-carbon? Lasts longer?

A Very Smart Plan for Federal Smart Grid Grants

John Peterson said, "But I spent many summers scorching my buns in the Phoenix and Houston sun and if given a choice, would always pick a store with covered parking over one with open parking.".

As a guy that lives in Dallas, I wholehearted agree. Please, bring on the solar panel covered mall parking lots! It's "cruel and unusual punishment" to make a person get into a car that's baked 2 hours in the midday summer sun in one of these cities. I like the free market, but to get parking lots covered with solar panels, I'll turn communist. Bring on the legislation. Long live the workers paradise. ;-)

Seven Companies Profiting From Obama's 'New' New Deal

I want to add Quanta Services (PWR) and Caterpillar (CAT) to you list of infra stocks that could do well under Obama.

Seven Companies Profiting From Obama's 'New' New Deal

David, You are. I would like to add some important points that some of the previous posters seem to miss.

First, this is not going to be anything like the Great Depression. The Great Depression was caused by a contraction of the money supply, when the money supply should have been expanded (you can blame that on the lack of understanding of economic theory, and the Republican dogma of the Hoover administration, not Roosevelt). Today, the central banks of the world are pumping trillions of dollars into the world economy. The US central bank, the Federal Reserve, has injected more than 1.2 trillion into the US economy since September. That’s a massive amount of money. But, it will take about 12 months to affect the general economy. Injections by the Federal Reserve always have a delayed effect. Note that this 1.2 trillion is totally separate from the $700 billion Federal bailout package. I am looking for a recovery starting in the second half of 2009, with it kicking in strong in 2010 because of this massive money supply increase.

Second. There will be low consumer spending for years. It will take years for the consumer to feel good again (and greedy – remember that “greed is good” from the movie Wall Street). Since consumer spending is most of the US economy, someone or something needs to pick up the slack to get the economy back to full speed and full employment in the next few years.

That is where federal infrastructure spending needs to come in. The reason the federal government can go on this borrow and spend spree is because of low inflation that allows the Federal Reserve to inject large amounts of money into the economy by buying US federal debt securities (see explanation below). I think the national debt fear mongers are wrong now, though they will eventually be right.

Third, as you said, public works projects often lead to large economic booms years later. That is because they can have a huge productivity gain for the economy. There are only 2 ways to grow an economy: increase population and increase productivity. You have a great example in your article with the TVA. But, my favorite is the Hoover Damn, also built in the Depression. The Hoover damn basically launched the economic boom of the southwest US. It cost $49 million but has given back billions in economic growth. I believe that alternate energy and the electric grid are the “Hoover Dam” projects of the present age. It looks like a huge up-front cost today, but in the following decades will give a many fold return to the economy.

This is a point often missed by people that stick with the Republican, conservative dogma that the private sector is ALWAYS the best place for capital expenditures that increase productivity. On the flip side, a huge amount of the private sector investment in the last 5 years went into building luxury homes and condos, and the overhead of the financial system. Both add little to general productivity. The founder of the Vanguard investment group estimated that $600 billion a year was spent on the overhead of the financial system in the last few years. He was shocked by how wasteful that was.

Explaining the Federal Reserve. The Federal Reserve’s main concern is inflation. It raises inter-bank lending rates, thus contracting the money supply when inflation is too high. And, does the opposite when inflation is low. The Federal Reserve also buys US Government Bonds to manage the money supply. The Federal Reserve gives the interest it makes on the inter-bank loans and US bonds back to the US government. I know that sounds circular and strange, but that is the nature of the Federal Reserve. Right now there is little inflation and in some areas deflation (how about those low gas prices!). This allows the Federal Reserve to inject massive amounts of money into the economy by buying US government debt, thus allowing the US government to borrow large amounts of money for infrastructure projects, basically interest free.

How You Can Invest in the Pickens Plan

I'm glad to see that some of you have recognized how pumping water will be part of the "smoothing out" infrastructure for alternate energy. Like the Swiss, we can use excess electricity to pump water, and then recover that energy when more electricity is needed. Just build higher altitude reservoirs and water towers.

Plus, we can pump water to places that need it using intermittent, excess electricity from wind and solar. We see now that major non-desert US cities need water like Dallas and Atlanta. That just emphasizes how much desert cities need water.

The rest of the world is even more thirsty for water than us. I foresee desalination and water pumping as being major infrastructure projects around the world, with alternate energy being a major source of power for these systems.