economy

[JohnRoberts]

I don't know if this is a problem unique to utilities,  new technology, over regulation, construction, or what...

I first became aware of poor management and cost over runs from my local electrical utility's clean coal plant. Several $B over budget, and unlikely to run actual coal until NG prices rise a bunch. This project also suffered from unfinished technology (clean coal is not a mature technology) and a shifting regulatory environment.

Now a power utility in SC just announced they were shutting down a new nuclear power plant projects because of  tens of billions in cost overruns.  This is one of the only 2 new nuclear plants started here since the 80's .  The other new nuke plant is in GA and being built by the same parent company (southern company) responsible for my clean coal debacle.

I was kind of interested because these are the first of a new generation nuclear power plant that is much safer design than all the old ticking time bombs around.  I think the nuclear fuel cycle is also more practical. But like the clean coal these are new technology and probably being saddled with new regulations.

The public has been wary of nuclear power since three mile island (before some of you were born 1979) but there have been a series of far worse accidents in other countries.  Ironically perhaps these newer, safer, plants may never get finished.

Westinghouse the company engineering and building the nuke plants has declared bankruptcy. Westinghouse is owned by Toshiba so they are taking a financial hit too.

It seems clean coal, and new safer nuclear power would be good things for the economy and environment but they are having a bad run of luck(?).

JR 

PS: Alphabet has proposed a novel energy storage reservoir to save off peak energy for peak use. A heat pump separates and stores hot salts and cold liquid (anti-freeze). Later they are recombined to make electricity again. 

PPS: a new battery patent promises 2x energy density/mileage for solid state batteries. We have seen these patents before and it hasn't been proved to be scalable yet, but sounds promising.

 

[Phrazemaster]

The inventor of the Li-ion battery, John Goodenough, is 94 yo. He is still in his lab and claims to have developed a MUCH higher energy density battery using glass. Quick charging, high capacity, no fires...

https://youtu.be/yu3cpICjCKw

 

[JohnRoberts]

The inventor of the Li-ion battery, John Goodenough, is 94 yo. He is still in his lab and claims to have developed a MUCH higher energy density battery using glass. Quick charging, high capacity, no fires...

https://youtu.be/yu3cpICjCKw

The release I saw was from toyota but doesn't seem close to happening, I hope Goodenough's is closer to reality.  A 2x improvement in energy density with faster charging and better safety may be a good improvement.  I guess we can always put new battery packs into old EVs.  I want a Mr fusion.

JR

 

[dmp]

Tesla Powerpack had 55 Wh/kg, while the Powerpack2 has 130 Wh/kg. Impressive gain for a year or so.
Still far from the specific energy of Gas/Diesel ~12,000 Wh/kg.
If batteries increase exponentially, they will be competitive in a few years.  I don't know what the technology will be, but I wouldn't bet against it.
To state the obvious, high energy density is possible, we just need the technology to create it on short timelines.

I want a Mr fusion.

Fusion generates heat, not electricity. So you still need technology to convert heat to work (like an engine).  Having a high energy density with high availability (i.e. electricity) is the golden goose.  Electricity can be converted to work with very high efficiency.

 

[JohnRoberts]

Tesla Powerpack had 55 Wh/kg, while the Powerpack2 has 130 Wh/kg. Impressive gain for a year or so.
Still far from the specific energy of Gas/Diesel ~12,000 Wh/kg.
If batteries increase exponentially, they will be competitive in a few years.  I don't know what the technology will be, but I wouldn't bet against it.
To state the obvious, high energy density is possible, we just need the technology to create it on short timelines.

Sorry to somebody who has been following this for decades it is not obvious. Several companies have made large "company killing" bets that they could come up with the next battery technology, and failed.

A 2:1 improvement may be exponential, but only if he keeps doubling again and again.  I'd bet money he and the rest of the world who has been trying to do this can't keep doubling. Not even remotely like scaling number of transistors on ICs. 

The new technology (solid state) batteries promises some inherent benefits, but comes with some basic problems too.
------
I thought electric cars were flawed because after a few years the battery would wear out and you have an expensive repair (used car  white elephant). Elon is smarter than me (a bunch smarter) and figured out he could just sell new extended range batteries to his old car customers, so instead of a painful repair, they were getting a huge performance upgrade.

Fusion generates heat, not electricity. So you still need technology to convert heat to work (like an engine).  Having a high energy density with high availability (i.e. electricity) is the golden goose.  Electricity can be converted to work with very high efficiency.

"Mr fusion" is a joke reference to the back to the future movies....

JR

 

[dmp]

Sorry to somebody who has been following this for decades it is not obvious.

It is obvious because it exists: i.e. fossil fuels.  We just need the technology to create something similar that can be produced renewably, efficiently, and economically.

As an analogy it is not obvious you can turn lead into gold. ie there's no natural process that turns lead into gold (although scientist now have with extremely expensive methods)

But there is a mechanism to turn readily available resources into a high energy density fuel (oil), but it takes geologic timeframes,

 

[JohnRoberts]

It is obvious because it exists: i.e. fossil fuels.  We just need the technology to create something similar that can be produced renewably, efficiently, and economically.

I guess I wasn't clear... I was talking about battery technology and do not expect exponential power density improvements to continue for that technology. As I mentioned some companies have literally bet their businesses that they would leapfrog current battery technology and failed.

One common theme about energy storage is putting a lot of energy into a small volume can be dangerous (just like gasoline is). One benefit of the solid state batteries is that they are mechanically more stable and robust, but there are other tradeoffs getting the current out.

As an analogy it is not obvious you can turn lead into gold. ie there's no natural process that turns lead into gold (although scientist now have with extremely expensive methods)

But there is a mechanism to turn readily available resources into a high energy density fuel (oil), but it takes geologic timeframes,

But every process involves putting energy into the system. Fossil fuels took their energy from the sun. Oil has been found in deposits only 1000 years old, so not quick and involving unusual conditions, but not exactly geologic time scale.

I have long suggested that one solution for costly energy storage is direct distribution of electrical energy to roadways. EVs without heavy batteries would be even more energy efficient. (This would only make economic sense in cities and densely populated areas).

Tesla (the original Tesla) worked on wireless transmission of energy, and who knows there may be some alternate technology out there yet to be made practical.

JR

PS: This is not a new pursuit. Back in the 60's my brother did a science fair project with a working fuel cell. I recall reading about flywheel energy storage for public transportation buses in old popular science/popular mechanics magazines back then.

 

[JohnRoberts]

I mentioned this a couple times over the last year, there are now public companies buying up houses to rent out. I expected this to be a relatively short term trade where they would take advantage of a temporary market distortion of weak homebuying  and low interest rates to buy and rent out homes now, then flip them later when the economics for home ownership improves (and rental profit declines).

Two of the largest public house owners are combining with a total inventory of some 80,000 houses (around the country). The only thing scarier than owning a house, is owning 80k of them. :

This economics will hinge on several factors, household formation, personal savings and credit quality, employment, new home building.

Several of these factors seem biased against increasing home ownership. 

Nesting.. Two of my immediate neighbors have full grown children living with them, one with an almost grown child of his own, the others still college age so perhaps not stuck chronically.

I am still waiting to see how all the college loan debt plays out. It seems a significant loan balance would make home buying a lot more difficult.

Apparently a lot of people think this rental instead of home ownership trend will persist (the corporation buying houses had a successful public offering).  I am probably showing my age, but I believe home ownership is still a good investment for most people, as long as they kick the tires up front and buy smart.

Skilled labor to build new homes seems in tight supply, raw materials (like wood from Canada) is more expensive, and modern homes have higher standards (like insulation) and more expensive features  raising prices.

The federal government still hasn't rationalized fannie and freddie, and that does not appear any where near the top of the list for congress to work on (while tax reform could alter interest deductions). Perhaps a few years from now after the DC drama subsides somewhat we might see reform of the mortgage market (privatize F&F). I am not a fan of huge home ownership incentives, that could create increased systemic risk (like the last time). 

So ideally I would like to see more private home ownership, but without a fat government thumb on the scale, distorting the economics.

JR

 

[JohnRoberts]

I noted earlier that the federal flood insurance program is already $25B in debt before this recent event. I dig a little deeper and the federal program was started because private insurance companies refused to sell coverage in flood prone areas... DUH.....

As it is now the federal program does not come close to covering actuarial risk (by tens of billions). On top of that people in less risky regions with federal insurance subsidize flood prone homeowners with federal insurance.

After the fact this seems charitable (and before forum members attack my "empathy" I already made a charitable donation to "direct relief" a well rated charity). But what purpose is served by encouraging people to live in risky areas?

Good governance would insist on new homes being fulling insured at rates that are actuarially sound. If the insurance is too expensive maybe don't build there. Of course the difficult issue is how to get from here to a less economically distorted state.

JR

 

[JohnRoberts]

I have been paying attention to the price of canned corn since before ethanol started using food for fuel.

For years I paid $0.33 for a one pound can of corn (generic store brand).  Shortly after ethanol started consuming marginal corn production the price of canned corn jumped 2x to $0.68 and stayed there for years.  Just this week I saw the first break in this canned cord price indicator to $0.44.

The commodity corn has long ago retreated from its ethanol highs but this generic canned corn stayed chronically elevated.  I do not know if this is rational pricing finally settling in or a reaction to recent competition in the food market industry.  Amazon has aggressively dropped prices at whole foods but I doubt this is worrying Walmart much.  More likely the one or two foreign food chains trying to gain a toehold in the US with lower prices. These foreign food chains typically use a lot of house branded commodities to keep prices low.

I suspect green giant and consumer brands that enjoy price premiums without rational support beyond TV ads, may be less profitable in the future. Humans make many day to day decisions without much rational inspection. which is why marketers spend so much on TV ads... I doubt people will start thinking more when food shopping : , but I expect larger price differentials to maybe get their attention.

Or not, this could just be a short term canned corn price rollback, time will tell.

JR

 

[JohnRoberts]

I noted earlier that the federal flood insurance program is already $25B in debt before this recent event. I dig a little deeper and the federal program was started because private insurance companies refused to sell coverage in flood prone areas... DUH.....

As it is now the federal program does not come close to covering actuarial risk (by tens of billions). On top of that people in less risky regions with federal insurance subsidize flood prone homeowners with federal insurance.

After the fact this seems charitable (and before forum members attack my "empathy" I already made a charitable donation to "direct relief" a well rated charity). But what purpose is served by encouraging people to live in risky areas?

Good governance would insist on new homes being fulling insured at rates that are actuarially sound. If the insurance is too expensive maybe don't build there. Of course the difficult issue is how to get from here to a less economically distorted state.

JR

I just read yet another article about federal flood insurance...  Something like 30% of the cost comes from 2% of the homes.  One house in TX has flooded 22 times since 1979. 

About the only thing taxpayers should insure on that lot is a houseboat.  8)

JR

 

[benb]

I just read yet another article about federal flood insurance...  Something like 30% of the cost comes from 2% of the homes.  One house in TX has flooded 22 times since 1979. 

I recall John Stossel on this very subject. He owned beachfront property with federal insurance (the only entity that offered insurance for that location!) with premiums way below what it actually should be for the level of risk. It got washed or blown away about every other year and the insurance always paid for rebuilding it.

 

[JohnRoberts]

The price of ethanol free gas keeps going up. Even before all of our bad weather which obviously raised all of the gas........IRMA

  I started using it in my 2 "older" trucks about a year ago and it was the single best tune up either have seen.  I know I should get newer vehicles but, for now, I'm hooked on this gas. Only a few stations around me have it but, it's worth the extra miles . I haven't actually tracked any improvements in mileage but it's there . I can feel it.... Vroom...

Although I swear I feel a difference in other brands. I've read some stations aren't honest about the gas sometimes. I'd be curious to test myself one day.....

Don't get me started on ethanol (farm state boondoggle), but gas mileage claims should be modest. True pure ethanol has less energy content than pure gasoline, but pump ethanol (E-10) is only 10% ethanol so gas mileage hit should be low single digit.

I hate ethanol because of the damage it does to small engines (and big too, I use a gas additive). The politicians would like to increase above 10% ethanol but that would trash all the gas station pumps due to its corrosive properties. 

JR

[edit- I do not mean to downplay the significance of a 3% lower MPG across the entire fleet of vehicles. Ethanol makes sense to replace MTBE as an oxygenate (octane extender) as an additive to gasoline, but not to burn as fuel in place of 10% of the gasoline. MTBE is nasty and contaminates ground water.  /edit

 

[dmp]

Most cars should run fine on 10% ethanol gas, but if you let the tank sit for long periods or are in a wet environment (i.e. marine), it is worth the extra cost for no ethanol. Definitely buy 'no ethanol' for boating. With moisture, ethanol turns into a gel.
I had an outboard motor when I was a teenager that would barely run unless I put sea foam into the tank.  Then it would run pretty good. The next summer even that wouldn't work and it needed an overhaul. The coils were bad.
MPG might be slightly better since the heating value of ethanol is quite a bit lower than isooctane  (29 vs 47 MJ/kg) but the miles/$ will probably be worse, since the cost of premium to regular gas is pretty significant.

 

[JohnRoberts]

Yes. The ethanol free is now priced higher than the 93 premium with ethanol here. Less than a year ago ,and for a long while before that, it was priced around the 89 ethanol 10%.  I'm not sure why but, my trucks don't run nearly as well if I put the ethanol in.  I'll maybe test the actual mpg it may or may not be helping one day but, I'm pretty confident it's a better thing in my situation so , I'm in no hurry....

How well the vehicles run may be a matter of tune.  Indy engines make huge horsepower while running pure alcohol. Lower "octane" means it burns faster so you need to retard the timing.

The big issue AFAIK is that ethanol attracts and holds water that is corrosive...  In some of my small motors , like chainsaws all the plastic tubing disintegrated.  The carb on my riding mower developed a gas leak that is unhealthy (for me and my house).

JR

 

[Gene Pink]

How well the vehicles run may be a matter of tune.  Indy engines make huge horsepower while running pure alcohol. Lower "octane" means it burns faster so you need to retard the timing.

A clarification, straight ethanol is much higher octane than the usual pump gas. So they blend it with something less than 87 octane, to get 87 in the final E10 product that you buy.

The big issue AFAIK is that ethanol attracts and holds water that is corrosive...  In some of my small motors , like chainsaws all the plastic tubing disintegrated.  The carb on my riding mower developed a gas leak that is unhealthy (for me and my house).

Yeah, been there, replaced many hoses, chainsaws, weedwhackers, leaf blowers, and also priming bulbs. There is a replacement tubing out there, might be called Viton, sort of a yellow/green, that stands up to ethyl alcohol, which in my opinion should only be used for heating, cleaning and drinking, and not necessarily in that order. 

Any decent small engine repair, lawnmower repair shack will have spools of the stuff in whatever size you need. Big box hardware stores also sell all-inclusive kits, forcing you to spend too much money for a multitude of sizes you'll never need, just to get the one or two you do need.

I drain all handheld tool fuel tanks back into the containers after use, to leave the tanks dry between uses. Drained through a coffee filter and funnel, crap always gets in there, so keep the tanks clean. Tiny crap in fuel screws with a pulse diaphragm carburetor, annoying to rebuild.

Gene

 

[Gene Pink]

...But with the 87 ethanol free, it runs better than it ever has.  I know it has something to do with the tune ...

Yep.

I am presuming you have a carburetor, and not a computer controlled throttle body, as you say "older truck". Welcome to the club.

I believe you have a mixture problem. If 87 oct, with no E runs great, and  87 oct. with 10 percent E sucks,  then this is because your carburetor is probably well tuned for no ethanol.  The extra oxygen in ethanol makes the mixture too lean for the motor. This usually shows up in flat spots in the throttle response.

Maybe you are cruising at 40MPH, and decide to go 50, initially you feel the acceleration surge, but then it bogs down. Sound familiar?

If so, if you plan on running E10, a carburetor re-jetting or metering rod adjustment will fix it. Could be a DIY job, if you are up to it.

Yeah, landscapers are using the ethanol free a lot....... and it was interesting to see the generator I was using during the hurricane instructions specifically state to use ethanol free or no more than 10% ethanol gas...Even had the graphic on the tank..... Don't think I have seen that before.....

No more than 10 percent?  Probably just to keep idiots from filling with E85, their little carburetors would not be able to adjust without a wide range of computer controlled feedback, based on an O2 sensor telling management where we are at..

 

[JohnRoberts]

A clarification, straight ethanol is much higher octane than the usual pump gas. So they blend it with something less than 87 octane, to get 87 in the final E10 product that you buy.

Yes, higher octane which means slower burning (all else equal you can get more power from slower burning by advancing the timing so it has more time to push against the piston on the down stroke). They started adding ethanol to gasoline instead of MTBE to hit octane numbers. (Octane ratings is a comparison to pure octane (C8H18) molecules.  Engine knock is caused by the fuel air mix burning too fast and creating a back pressure wave before the piston even reaches top dead center. Modern engines have more advanced ECU to prevent engine knock. Back in the day a bad tank of gas (low octane) would knock like crazy.

Anyone remember the water injection gadgets, sold to the gullible to increase gas mileage...  if absorbing water is bad, imagine injecting it directly into your motor.  :

Yeah, been there, replaced many hoses, chainsaws, weedwhackers, leaf blowers, and also priming bulbs. There is a replacement tubing out there, might be called Viton, sort of a yellow/green, that stands up to ethyl alcohol, which in my opinion should only be used for heating, cleaning and drinking, and not necessarily in that order. 

Any decent small engine repair, lawnmower repair shack will have spools of the stuff in whatever size you need. Big box hardware stores also sell all-inclusive kits, forcing you to spend too much money for a multitude of sizes you'll never need, just to get the one or two you do need.

not just hoses, the composite needle valve seat in my riding mower carb which wasn't replaceable started leaking. Replacing the whole carb every couple years was an expensive maintenance item.  I added a gas cut off valve so it doesn't burn down my garage while parked.

I drain all handheld tool fuel tanks back into the containers after use, to leave the tanks dry between uses. Drained through a coffee filter and funnel, crap always gets in there, so keep the tanks clean. Tiny crap in fuel screws with a pulse diaphragm carburetor, annoying to rebuild.

Gene

I use a gas additive, and hope it works... my small engine guy swears by it.

JR

 

[JohnRoberts]

I like to pay attention to economic issues (and angles) and share when something looks interesting, got a few today.

#1 I shared recently in a discussion about household energy efficiency that homeowners often can not afford the capital investment to upgrade to higher efficiency infrastructure (insulation, heat pumps, etc). Apparently there is a government program to promote energy improvement lending, from dept of energy 2016, called PACE (property assessed clean energy). What could be wrong with that? Let me count the ways.  8)

These PACE loan programs end up being local state programs and small contractors often originate the loans, to help homeowners pay for some expensive upgrades they are selling/installing. Complaints are being investigated that contractors misrepresented the costs of these loans, some claiming that tax breaks would completely pay off the loans. In some cases there can be tax deductions but not for all upgrades, and for a deduction to be valuable you first have to have enough income to offset that some older retirees don't. 

The next PACE related item that is being investigated is that loan bundlers have been making payments for some homeowners in arrears. While this seems very generous of them, they are not being charitable. In fact they have bundled these loans into larger securities that are then resold (not unlike the bundled mortgages in 2007/8 economic collapse that were mispriced for risk). By making payment for homeowners in default, they can then claim that the bundled debt is all still performing, when it isn't.  :

#2 This is brand new and at least one homebuilder has come up with a new sales program where they will pay down a fraction of a millennial's student loan, in combination with them buying a new house. The big lie associated with this is that the program will not increase the cost of the house. If you believe that I have some swamp land to show you.  :

#3 Not strictly economic but definitely an economic angle. The kurdish region of Iraq held their independance referendum despite opposition from the central government in Baghdad, and pretty much every surrounding country. I am not sure what everybody is afraid of while there are significant kurdish minorities in Iran, Syria, Turkey, etc. 

The economic angle in this is that the Kurdish region has their own oil reserves that they sell through a pipeline running into Turkey to generate revenue outside control of the Baghdad government. So while Turkey opposes their independence they don't mind buying the cheap oil. (Turkey reportedly bought cheap oil from ISIS too).

93% voted for independence so this issue will not fade away quietly. 

JR

PS: More reports about the russian ad purchases. They apparently were supporting both sides of contentious issues to stir up division and chaos. It reminds me of the ghostbusters movie where evil spirits gained energy from public anger and discord.  Sounds like they were just being russian and attacking democratic systems in general (Putin is ex-KGB).

 

[dmp]

Yes, higher octane which means slower burning (all else equal you can get more power from slower burning by advancing the timing so it has more time to push against the piston on the down stroke). They started adding ethanol to gasoline instead of MTBE to hit octane numbers. (Octane ratings is a comparison to pure octane (C8H18) molecules.  Engine knock is caused by the fuel air mix burning too fast and creating a back pressure wave before the piston even reaches top dead center. Modern engines have more advanced ECU to prevent engine knock. Back in the day a bad tank of gas (low octane) would knock like crazy.

disclaimer that I work in engine research, so might be more than any of you care about.

Octane number measures the fuels resistance to autoignition and that's all. It doesn't measure flamespeed or how fast or efficient combustion will be.

In SI engines, autoignition is apparent as knocking.  Engine knock is abnormal combustion where the end gas autoignites ahead of the flamefront causing high intensity pressure waves to bounce around creating noise (pinging) and sometimes damage.  The key engine design factor affected by autoignition in spark ignited engines is compression ratio (CR).  High CR SI engines require high octane fuel to avoid knocking.  Pure ethanol actually has a higher octane number than isooctane, ~113, so is even more resistant to knocking. Pure isooctane (C8H18) measures 100 and pure heptane (C7H16) measures 0.  Since Diesel engines are compression ignited, they want a low octane fuel, i.e. pure heptane. The Cetane number is used to characterize fuels in Diesel CI engines and is the inverse of octane number.
What do these numbers mean? It is just a reference. To measure the Octane number of a fuel, say gas blend A, a variable CR engine is run with the gas blend A and a mix of isooctane and heptane. The blend of isooctane and heptane that matches the knocking CR of the blend gives the octane number.
High CR makes an engine more efficient, i.e. more power out of the same amount of fuel. BUT, running high octane vs low octane fuel in the same engine will give no difference in efficiency or power (due to the octane number anyway).  The amount of energy available in the fuel is given by the heating value (isooctane and heptane are nearly the same, ethanol is lower). The amount of power extracted from the fuel is given by the indicated work done on the piston : pressure times the change in volume, PdV. The Otto cycle describes the ideal thermodynamic process of a SI reciprocating engine.

For an SI engine to run well you want the ignition delay to be short and the flamespeed to be high. both ignition delay and laminar flamespeed are functions of the fuel properties, air fuel ratio, and Temp and Pressure.

Old engines might run well with premium gas, but it is probably due to other characteristics than the Octane number.