Saturday, June 25, 2011

A greener four weeks in America

This past four weeks we had greener weeks than in many past years. What caused the change? Was it Obama’s idea to release oil from the strategic reserve? Was it the IPO on Friday of KIOR? Was it a breakthrough at Bezerkley that turned water into hydrogen by sunlight? Actually none of the above made the weeks any greener. What happened during the week was that I noticed that the US economy is again in a double dip recession and that diesel consumption in these ignited states is down significantly versus last year. The US Petroleum Balance Sheet for the Week ending 6/17/2011 as presented by our Department of Entropy shows that for the four weeks ended 6/17/2011 versus the four weeks ended 6/18/2010 our diesel consumption is down 5.7% at 3,668,000 barrels a day versus 3,891,000 last year. In 2007 when we still had a developed economy we used 4,100,000 barrels a day of diesel.

Diesel consumption in these summer months has nothing to do with home heating. It is all about the hauling of freight around the country. It is not like 2010 was a great year for economic activity so the comparison between 2011 and 2010 is between worse and bad. The department of entropy is kind of like the movie dumb and dumber but our economy is now worse than bad. The release of the 60 million barrels of strategic reserves from the US and our allies will have a temporary effect of lowering oil prices but it will not change the fact that the so called developed economies are struggling and the so called political leadership of these countries are as lost as the prime minister of Greece in coming up with solutions.

A little on the IPO of KIOR a company brought to you courtesy of Vinod Cost Us the clown. Their alchemy is to rapidly turn swichgrass into diesel in a reactor. Al Gore is not on the board of this thermodynamic dead end, Vinod reached across the aisle and grabbed Condi Rice for this board membership role. Yeah we remember Condi being so certain we will find weapons of mass destruction in Iraq, now she is certain that KIOR will produce weapons of mass combustion in some shiny steel reactor with a magic catalyst that yields copious amounts of clean diesel from switchgrass to be grown on the prairies.

This was the press release in the New York Times of Condi joining

“June 22, 2011

Former Secretary of State Condoleezza Rice plans to join the board of biofuel startup KiOr in July. Not coincidentally, the news comes the week that KiOr is reportedly planning to official price its IPO, which could raise up to $241 million on the Nasdaq.

Rice is no stranger to board seats, the oil industry, or Valley startups. Before she was Secretary of State, she sat on Chevron’s board; she is a director at C3, the carbon software tool backed by Thomas Siebel; and is a Professor at Stanford. While she was Secretary of State, she played a major role in how the U.S. responded to the Kyoto negotiations, (she was widely quoted at the time as proclaiming Kyoto to be dead).

If greentech startups have the heft, they try to bring on well-known, often-times political, figures to help open doors and raise their profile. Khosla Ventures — which basically controls KiOr — also brought on former British Prime Minister Tony Blair as a senior advisor. Kleiner Perkins has Al Gore and Colin Powell. Rice will probably be able to help KiOr make some important connections, given her political status and her Chevron time.”

KIOR did their IPO yesterday and it did not raise $241 million they only managed to fleece $150 million from the thermodynamically impaired. Interesting that Condi under the Bush was against Kyoto but now that she can make some bucks as a board member of KIOR she is all for the color green.

Sadly we have a shattered economy but thankfully we are being greener about going our no business.

Friday, June 17, 2011

Camels and Carbon

When I was in college way back when smoking a cigarette was cool I used to smoke Camels without any filter. They were a great smoke and the advertising campaign was “I’d walk a mile for a camel”. The advertising campaign to walk a mile for a camel was originally a 1920s campaign but was brought back in the late 1960s. In the 1940s their advertising campaign was “more doctors smoke camels than any other cigarette”. In the 2000s the campaign became “pleasure to burn” with a cartoon character called Joe Camel. Now hardly anyone walks and some people still smoke camels but thank goodness no one believes that more doctors smoke camels than any other cigarette. What is all this talk about camels and why does the green machine even care?

Well I have several readers from down under and those Waltzing Matildas have a problem with feral camels in the outback. An enterprising Aussie in the mid 19th century thought it would be a good idea to import camels from India and use these animals for draught animals in the outback. They did this for a few years till railroads and internal combustion engines proved to better at hauling freight and the Aussies being kind let the Camels roam free in the outback. The camels like to hump so to speak and now there are 1.2 million feral camels roaming the outback. The camel population doubles every 8 years so soon there may be more camels than Aussies.

Wild camels cause trouble with the vegetation and even pull off the air conditioning units on houses to get to the condensed water inside the units. Worse still each camel emits over 100 pounds of methane per year. The Aussies hope to pass a bill in their parliament to allow killing of the camels under the “carbon farming initiative”. There will also be a bounty on the head of each killed camel. Wow 1.2 million camels and each blowing out 100 pounds a year of methane that is 21 times the greenhouse gas of carbon dioxide and we get about 1.2 million tons a year of CO2 equivalent greenhouse gas simply for the methane emissions of feral camels. I have no idea how much vegetation they destroy but that also has to add a significant quantity of greenhouse gas as the result of these animals being free.

Time magazine reported the following: “As Australia struggles to get out from under its status as the world's largest carbon emitter per capita, at least one company has sensed an opportunity. Under the nation's Carbon Farming Initiative, a plan to help combat emissions that was submitted to parliament yesterday, Adelaide-based Northwest Carbon has suggested the nation solve its camel crisis by putting a price on the animals' heads — on the carbon market. Under the scheme, companies and individuals would receive carbon credits for shooting camels by helicopter or truck, or herding them and taking them to slaughterhouses. The camels could be processed for pet food or human consumption, and the carbon credits earned could be sold to domestic or foreign polluting companies. “We're a nation of innovators and we find innovative solutions to our challenges,” Northwest Carbon's Tim Moore told the Australian. “This is just a classic example."

The Green Machine is all for culling the herd of feral camels and selling the meat as a delicacy. The Aussies need an ad campaign and should go back to what camel cigarettes used in the 1990 when they had a cartoon character called Joe Camel. Aussies call young kangaroos Joeys and the blokes down under could have a new cartoon hero called Joey “the kid kangaroo that kicked the Camel’s butt”. Note the pun on cigarette butts. Joey could be made to look the Elmer Fudd of kangaroos and he will carry his rifle ever in the pursuit of a “wery ganggween fewal camel”.

Saturday, June 11, 2011

Apple is a Granny Smith

News from Cupertino California this week is that Steve Jobs asked the city planning commission for approval of a new headquarters building for Apple Computer. The building will be ultramodern with only curved windows and will resemble a large flying saucer on the 150 acre site that once housed an apricot orchard before it was developed with a Hodge Podge of nondescript industrial buildings several decades back.

Steve presented to the city a master plan to accommodate 12,000 people in the new HQ. There will be underground parking and significantly more landscaping as the surface parking on asphalt paving will be totally eliminated. The architecture of the building is striking and the single circular building will have a total on 1.1 million square feet. It will not have one single piece of straight glass. It will be a low rise building of 4 floors and will have an inner courtyard within the flying saucer.

The thing that perked the Green Machine’s interest is that Apple has proposed its own energy center to provide base laod energy for the HQ and that Apple will only rely on the grid for backup power. Steve did not BS the city that wind turbines, or photo voltaic cells will provide the power, he said straight up that natural gas fired power stations will provide the electricity and heat for the building. He also stated that natural gas is the low carbon emission method for providing reliable base load power. Mr. Jobs must have done his job well by reading Green Explored for real not imaginary information. Steve I applaud you for your vision for a headquarters that will turn heads.

My prognostication is that Apple stock has actually peaked and will decline long before the headquarters is built. I say this only because each and every company that announces a new “world class” headquarters does this while flying high and by the time the HQ is built the tides have turned as competition heats up when one company is making a mint. Back in 1990 I lead a team of consulting engineers to build Apple’s Fremont California factory. Apple was riding high then and Intel was a dog. In very short order Apple closed the Fremont plant Intel soared and it was not until about a decade ago that Apple rose again like Lazarus. I also lead the team of engineers that built Intel’s flagship development Fab in Santa Clara. It too like the Apple Fremont plant is closed. Silicon Valley fabricates no silicon, it is more of software valley and the hardware is pretty much manufactured in Asia. The fabs that I designed for National Semi, VLSI Technologies and others are also dismantled and long gone. My guess is that Apple’s competition will come from Samsung or another Asian competitor and the 12,000 folks that are intended to be housed in the HQ will have some shoulder room when it opens.

I no longer design and build high technology facilities. I have migrated back to basic organic chemistry in the belief that the USA can compete in those markets. My belief is shared by Shell who is planning the first ethylene cracker to be located in the USA in three decades. Shell sees competitive natural gas prices in the USA because of the availability of shale natural gas. I too see this as a boon for US manufacturing of chemicals.

The fools at Amyris who believe they can compete with ethylene derived from natural gas with their bio isoprene derived from table sugar will lose within short order much of their billion dollar market capitalization. Apple has a 301 billion dollar market capitalization. Four firms had over 500 billion dollar market capitalizations prior to the dot com bust. They are Intel, Microsoft, Cisco, and GE. Intel now is worth $113 billion, Cisco $83 billion, Microsoft $199 billion and GE $194 billion. Exxon Mobil has a value of $393 billion.

My guess is that when Apple opens its new HQ in Cupertino, Exxon Mobil will still out value Apple and the $300 billion market capitalization will be a distant memory. It is really interesting how Intel and Cisco who dominated hardware a decade ago are worth only 20% of their peak. I think Apple will rot a little more slowly as they at least are intending to be green. Interesting the peel of apple is much healthier to eat than the flesh. Red Delicious apples have the highest level of health imparting chemicals in their peels. Perhaps we should all be red rather than green. Red is a great color as it means stop, and allow the folks at right angles to pass. A great Red Machine is a Farrari.

Sunday, June 5, 2011

Solar Slime

A company called Solazyme (Solar Slime in the Green Machine’s vocabulary) had an IPO this week and has the thermodynamic neophytes on Wall Street in rapture. The company is in the business of making biodiesel from algae. This is not your average pond scum company. The average pond scum company claims the use of sunlight, carbon dioxide and water to yield lipids from algae. Solar Slime has a different angle on being gangrene. They will use sugar instead of carbon dioxide and sunlight as the carbon and energy sources for their wonder algae to perform the “miracle” conversion of sugar to oil.

Yeah Solar Slime is another company taking a food crop and intending to propel the billion vehicles on planet earth. In previous blogs I have given my readers some data on the land and water intensity of growing crops to yield table sugar. Just like the great lovers at Amyris, Solar Slime needs sugar to yield a vehicle fuel. Why not simply grow soy beans and yield a crop that can feed people, and then have the people ride electric bicycles, take the bus, or walk and save the world from the sugar to diesel nonsense where there is no value add and only the government and dumb investors support the conversion of furniture to wood.

Just today Nissan announced they have cut their forecast of Leaf sales in the USA in half to a paltry 10,000 units for the full year of 2011. Nissan is still getting over a billion dollars of Federal grants and loans to equip their plant in Tennessee to build hundreds of thousands of Leafs a year starting in 2013. The Mamas and The Papas gave us California Dreaming about escaping brown leaves, the Nissan crowd will give us a new song called Tennessee Dreaming where we all believe that the Nissan Green Leaf will sell a million units. Of course the dreaming will take place when we are all drunk on Jack Daniels.

The boys at Kleiner Perkins continue their green fake out with additional funding for Fisker who claims they will sell their first plug in hybrid $100,000 car in July. Fisker has Coda beat by a whisker in launching their car first as Coda has now delayed their launch till late this year. Fisker is supported by Al Gore while Coda is the brain child of Hank the Tank Paulson. The Green Machine is fair and balanced and suggests that both Al and Hank should just fade away after both of them had a hand at messing up the country while pretending to be public servants in Washington. If I remember correctly old Al Gore did not carry his home state of Tennessee in the 2000 presidential elections. Perhaps the people in Tennessee are smarter than the folks in Delaware where old Biding His Time managed to hoodwink the Feds to equip that Fisker assembly plant. News is that Fisker is now saying they only need one third of the floor space of the former General Motors plant. I guess kids in the second grade can learn fractions by reading the news from Renault, and Fisker.

The laws of thermodynamics are not fractional and the second law will always hold long after

the leaves are brown,

the sky is grey,


all our pretend praying did not make fossil fuels go away