Archive for June, 2011
The healthy growth of mankind depends on continuously decreasing the cost of water and energy everywhere.
Nice thought. Why mention it?
Its a mission statement.
Microsoft founder Bill Gates and Berkshire Hathaway CEO Warren Buffett — and through them America’s billionaires.
Why Bill Gates? Why Warren Buffett?
As to Bill Gates, his passion; According to a recent interview
Understanding science and pushing the boundaries of science is what makes me immensely satisfied. What I’m doing now involves understanding maths, risk-taking. The first half of my life was good preparation for the second half.’
Now in the context of the interview he was talking about the development of a vaccine to cure a disease like malaria but its clear that energy is part of that picture too.
In 2010 at the annual Ted conference he said his greatest wish–greater even than the efforts of the Bill Gates Foundation–was that a new energy source be invented that delivered power for less than half the cost of coal.
If you gave me only one wish for the next 50 years… I could pick who’s president…. I could pick a vaccine —- which is something I love— or I could pick this thing that’s half the cost [of coal based electrical production] with no CO2 — gets invented — this is the wish I would pick. This the one with the greatest impact.
This year at his annual corporate executives conference–he included energy research as a core technology research investment goal.
What about water?
Mr Gates is half way to recognizing the importance of water. Over the last several years, the Bill & Melinda Gates Foundation has given over $1.7 billion to support food security worldwide. At several conferences in the last year he has talked about the importance of grants to help poverty stricken small farmers in South Asia and Africa to grow more food. But at the same time he has emphasized the need for tech innovation.
The Chronicle of Philanthropy reports that Gates offers “a glimpse into his thinking and his hopes for the future. ‘Despite the tough economy, I am still very optimistic about the progress we can make in the years ahead,’ he writes. ‘A combination of scientific innovations and great leaders who are working on behalf of the world’s poorest people will continue to improve the human condition’”
What innovation is foundational to the next great green revolution?
That is delivering water in massive volumes–cheap enough for farming –1000 miles from any seacoast.
Therefor think of water as a proxy for food.
Water is foundational to civilization. It always has been. Always will be. In this article 20 former world leaders talk about the looming global water crises. You can already read Wall St Journal articles about the return of 1970′s style ideas from scholars like Paul Ehrlich “Population Bomb” or the Club of Rome’s “Limits of Growth” (read by a million boomers as students in high school, college & graduate school. As it happened, these 70′s books coincided with the peak and initial decline in US (cheap) oil production as well as the end of the era of US dam building. Also, several thorium test plants were abandoned.)
Today, many large players through out the world including sovereign wealth funds are buying up agricultural land.
They are anticipating a world wide shortage of food supplies. But so far, these food shortages have not been in rural Africa or Asia where many current poverty programs are targeted. Rather the shortages/high prices have been in big cities. There have been major food riots already. What has not been widely reported about the crises in Egypt in early 2011…– is that it was sparked by money –not politics. There were big increases in the cost of grain.
The target for Mr Gates research has not been the cost and availability of water but rather pricy genetics and fertilizers.
Warren Buffet’s son says that–based in his own experience– Gates high tech farming investments won’t work in third world places once he leaves.
He said that the Gates Foundation was essentially trying to recreate US-style industrial agriculture in Africa, an approach that he himself had tried early in his philanthropic career. “I don’t think it worked,” he said. “We need to quit thinking about trying to do it like we do it in America,” Buffett added.
Earlier in the segment, he championed low-tech, inexpensive methods for increasing farm productivity—a stark contrast to the high-tech seeds and pricey synthetic fertilizers favored by Gates.
The problem with Mr Buffet’s solution is that it won’t produce the amount of food necessary to maintain the world’s population when it doubles in 50 years. Rather, Mr Buffet’s solutions will further buffer some poor rural areas of the world from the food shortages of the rest of the world.
Why is this true? Consider the cost of energy to be the top line measure of wealth and the cost of food to be the bottom line measure of wealth. In poor countries –where the cost of food is a large part of people’s budgets–when the cost of food doubles it causes riots. In rich countries, when the cost of food doubles — nothing happens because food is a small percentage of peoples costs. The same cannot be said for fuel. When gas prices double as they are about to do in the USA there are definitely problems.
Mr Gates concluded the 2010 Ted conference speech by saying
If we don’t get this wish [for cheaper energy]the division between those who think short term and long term will be terrible between the us and China between poor countries and rich and most of all the lives of those two billion will be far worse
Why get other billionaires involved?
Bill Gates and Warren Buffet are looking to get billionaires in the USA and the rest of the world to
give away at least half of their wealth.
Gates & Buffet have left it up to billionaires to decide what to give their money to. Many are agreeable to the idea. but there is a catch. All would love for their money to have a real impact. They want the same thing as Bill Gates and Warren Buffet. They want to make a difference. However, they don’t know what would have the greatest impact.
Mr Gates has mentioned that cheaper energy will have the greatest impact.
What difference does cheap energy and cheap water make?
Consider; If you collapsed the cost of water desalination and transport so as to make desert farming profitable 1000 miles from any seacoast, you could turn the world’s deserts green. That would increase the habitable size of the USA 1/2, China by 1/3, double the habitable size of Africa, triple the habitable size of Mexico, increase by 100 fold or the habitable size of Australia, increase by a third the habitable size of central Asia — and double the size of the habitable earth.
Let’s do a thought problem. Which project is more technologically easy to do, costs less, and has a greater immediate economic payoff.
1.) Plant colonies on the moon and Mars
2.) Turn the deserts of the earth green.
The answer should be obvious. Planting colonies on the moon and Mars involves inventing literally hundreds of new technologies that at best will not serve more than +-100 people for the next four decades at a cost of 100′s of billions of dollars.
Its technologically easier, less costly and much more profitable to do the R&D that will make it cheap to turn the earth’s deserts green. Why? Because all you need to accomplish this are cheaper versions of two already existing technologies. Pipelines and desalination plants–. The research project wouldn’t be trivial but its cheap and easy with a huge payoff in the near term compared to doing the R&D to enable colonies on the moon and Mars.
Yet everyone in the world has bought into the idea that 20 years to 40 years from now there will be small colonies on the moon and Mars after the expenditure of 100′s of billions of dollars by dozens of governments world wide.
Lower the cost of water and power such that desert farming anywhere is competitive farms in the American midwest — and market forces and governments will take over to do the rest.
Bill Gates has already invested in Big Picture Ideas but his vision is slightly off. Consider:
A small group of leading climate scientists, financially supported by billionaires including Bill Gates, are lobbying governments and international bodies to back experiments into manipulating the climate on a global scale to avoid catastrophic climate change.
The scientists, who advocate geoengineering methods such as spraying millions of tonnes of reflective particles of sulphur dioxide 30 miles above earth, argue that a “plan B” for climate change will be needed if the UN and politicians cannot agree to making the necessary cuts in greenhouse gases, and say the US government and others should pay for a major programme of international research.
Professors David Keith, of Harvard University, and Ken Caldeira of Stanford, [see footnote] are the world’s two leading advocates of major research into geoengineering the upper atmosphere to provide earth with a reflective shield. They have so far received over $4.6m from Gates to run the Fund for Innovative Climate and Energy Research (Ficer). Nearly half Ficer’s money, which comes directly from Gates’s personal funds, has so far been used for their own research, but the rest is disbursed by them to fund the work of other advocates of large-scale interventions.
According to statements of financial interests, Keith receives an undisclosed sum from Bill Gates each year, and is the president and majority owner of the geoengineering company Carbon Engineering, in which both Gates and Edwards have major stakes – believed to be together worth over $10m.
Much simpler would be to collapse the cost of water desalination and transport. That would turn the world’s deserts green. Naturally green farm lands take up much more carbon dioxide.
How do you collapse the costs of water and power? I think Mr Gates understands the issues involved with energy. In order, to collapse the cost of delivered desalinized water–just two technologies need to be improved–membranes and pipelines.(Delivering water cheaply over great distances by pushing water uphill will require cheaper energy–as well as better/faster/smarter pipelines. Membranes are currently expensive and require a lot of energy to desalinate water. Their cost/efficiency/longevity is falling by half about once a decade or so. Already, the elements are in place to significantly accelerate that decline in price.) (There are subsidiary issues like finding ways to profitably turn Na+ Cl- and dozens of trace elements–into products. I talk about this in more detail here.)
What about the US federal government? Isn’t there a United States program for water desalination? Doesn’t this nation spend money on water R&D? Yes, about 50 million scattered through a dozen agencies. (This compares to 1.5 billion annually in today’s dollars spent on desalination research from roughly 1955-1975 –which research developed the semi permeable membrane that filters much of the installed desalination industry today.) US Corporate desalination R&D contributes another 50 million annually.
Isn’t energy research something that the Department of Energy does?
Yes– but just as with water–the feds are not doing nearly enough. According to Bill Gates in this interview:
Interviewer:You are a member of the American Energy Innovation Council, the AEIC, which calls for a national energy policy that would increase U.S. investment in energy research every year from $5 billion to $16 billion.
Interviewer:I was stunned that the U.S. government invests so little.
Gates: Yeah, particularly when you look at the DOE budget, and it looks so big–but the biggest part of that by far is dealing with the legacy of nuclear weapons production at various sites around the country. I was stunned myself. You know, the National Institutes of Health invest a bit more than $30 billion.
But the US government is not going to step in with 10 billion. (If anything federal research dollars are likely to shrink.) However, America’s billionaires might–if the impact of the work was great enough. If the vision was great enough. Like for example, turning the world’s deserts green. Then once accomplished– using the water and energy technology developed to green the deserts of the earth to colonize the deserts of the moon and Mars.
For a moment, lets discuss the Bill Gates Foundation because I think that Mr Gates– by way of his thoughts on global health and its relation to wealth– is already backing into the idea that I’m proposing.
The Gates Foundation funds medical research in diseases that are not common in wealthy countries. (Generally, the Gates foundation serves grant seekers seeking to bring innovations in health, development, and learning to the global community. This includes education scholarships to low income families.)
The Gates Foundation is in that health area, and when we pick a disease to work on, we pick a disease where for some reason the market is not working. Like malaria: rich people don’t need a malaria vaccine. They are rarely in malarial areas, and when they are, they can take prophylactic drugs and not worry about it.
Mr Gates reasons that there is a relationship between health and wealth. According to this article
WASHINGTON, DC, January 18, 2011 (LifeSiteNews.com) –
Attributing the decline in the number of children who die before their fifth birthday from 20 million in 1960 to 8.5 million today to infant vaccination, Gates told the audience of more than 2,000 at the conference, “About one-third [of that improvement] is by increasing income. The majority has been through vaccines. Vaccines will be the key.
1/3 might be a little low for the influence of wealth on health. Certainly it could be reasonably argued that 1/2 might be more like it.
Its easy to show, for example, that there is a correlation between health and wealth. Consider this utube from from global health specialist Hans Rosling.
What you’ll see is that the west made huge gains in health and wealth before 1900 without ubiquitous vaccinations. From 1900 to 1960 the west continued to make huge gains in health and wealth –with vaccination–while the rest of the world wealth gains remained stagnant. But after 1960–the health and wealth of much of the rest of the world moved in lock step upward. There is no initial lag of either health or wealth which would suggest that either health or wealth was preponderantly causal.
(Now I am not advocating that the Gates Foundation do anything other than what it is doing currently. Vaccines save lives. Rather I’m suggesting that if America’s other billionaires became involved in research to collapse the cost of water and power– then their work–would be a proper adjunct to the work of the Gates Foundation because it increases the wealth of the world –which in turn funds health advances.)
Even though Gates is more interested in charity with regards to poor countries–for several years he has recognized the importance of the energy to not only poor people — but also people all over the world.
Gates in the –energy ventures article — has said that
“I guess in a vague sense we can say that we want energy that costs, say, a quarter of what coal or electricity does. Why? Because that’s what it will take to raise the poorest of the poor in world to reasonable living standards. But it will also raise the living standards of the rest of the world.”
Energy costs directly effect productivity. The more productive people are the wealthier they are. The wealthier they are–the more they can afford things like health care. This is true for everyone.
Gates is doing some work along those lines –separately from his foundation work. Several years ago he invested in Sapphire Energy — an algae based biofuel company. As well he has invested in a unique nuclear reactor that has been developed by a company called TerraPower.
Just last month he invested in Liquid Metal Battery — a company that promises to store and release electricity in volume from intermittent sources like solar and wind.
That said Mr Gates does not see a great future for intermittant power sources like solar and wind. Rather the best chance for creating clean power and low cost in volume comes from nuclear energy.
Gates argues that nuclear power is still safer than all other energy options, rich countries aren’t spending enough on R&D, and installing solar panels on your roof is not helping to reduce CO2 emissions. It’s merely “cute.
While the cost of energy affects topline wealth–the cost of water reflects bottom line wealth. (For example, the cost of food represents maybe 8% of Americans home costs–however, food represents 40% of costs for say, people in Egypt.)
All the greatest advances in power and water in the 20th century were top down advances incubated mostly in the US and then moved to the rest of the world. This is true for oil-gas/internal combustion engine and hydro electric power, nuclear electric power/electric motors. The Hoover Dam in the USA provided the template for dams worldwide. According to T Boone Pickens this will likely be the case with fracking natural gas (and still more recently fracking oil). Because of new technologies the US now has the equivalent of three times the reserves of the Saudis. Chesapeake Energy President Aubrey McClendon now says the US is positioned to be energy independent in 10 years. As happened with earlier water power technologies, hydraulic fracking will likely go overseas too after it has done its work here in the USA. However, except for natural gas temporarily this energy will not come in at anywhere near at the price points equivalent to 1/4-1/2 the cost of electricity from coal. That is oil & natural gas in the USA seem poised to become plentiful again but not cheap. Even Mr Pickens says that fracking natural gas (and oil) is a temporary solution.
According to Gates if the USA does not lead in research –it doesn’t happen elsewhere.
But unfortunately, when the U.S. doesn’t step up on basic research, the world at large doesn’t tend to step up and fill the gap. I wish they would, but they don’t.
So its not disingenuous or cute to say that charity begins at home.
Gates writes another article here in which he maintains that the key to energy success is distributed innovation.
To achieve the kinds of innovations that will be required I think a distributed system of R&D with economic rewards for innovators and strong government encouragement is the key. There just isn’t enough work going on today to get us to where we need to go
Now there would be enough work in energy & water development to get us to where we need to go–if all America’s billionaires got involved.
I think that Donald Rumsfeld used an intellectual construct that can be applied to this distributed approach to research.
As we know,
There are known knowns.
There are things we know we know.
We also know
There are known unknowns.
That is to say
We know there are some things
We do not know.
But there are also unknown unknowns,
The ones we don’t know
We don’t know.
Known knowns are things we know we know. This would represent direct investment in companies and research that furthers the goal of cheaper water and energy. This is what Bill Gates and many other investors are currently doing. They find a tech that looks promising and invest in it.
Known unknowns: that is things we know we don’t know. Wouldn’t it be nice to say “Ok we have this problem and we will pay this much for a solution. A number of web sites have grown up in the last couple years that bring together Research organizations and problem solvers like InnoCentive, YourEncore, & NineSigma. There’s a lot of seriously interesting ways this can be used to accelerate energy and water research. Consider this article by Wired Magazine.
Unknown unknowns. The problem with any directed research is that its directed. Many times solutions can come from unknown directions. What’s the best way to harvest this?
Newt Gingrich in 2001 fleshed out this idea by saying.
Historically, prizes have been used to stimulate breakthrough technology. Prizes are particularly effective motivators of entrepreneurs, who use investment capital to test their ideas and generally invest four times the value of a prize to win the competition. The X-Prize Foundation was recently established to manage such prizes as the $10 million Ansari X Prize for Suborbital Spaceflight, the $10 million Archon X-Prize for Genomics, and the $20 million Google X-Prize to land and successfully operate an unmanned rover vehicle on the Moon. Such prizes must be big, even huge, to produce meaningful discoveries on a grand scale. Perhaps a prize of $1 billion could be the impetus for a 500-miles-per-gallon car. Robust incentives and prizes might produce a hydrogen-based economy much faster than would conventional R&D.
Gingrich was low in his calculations as to how much research the X-Prize actually produced. According to this ingenious article by Tim Hartford called called Cash For Answers–When the competition was completed:
The X Prize foundation claims that the Ansari X Prize directly stimulated $100m of spending on research and development, 10 times the value of the prize itself. That is clever, and for a handful of sexy challenges it is likely to be a trick that can be repeated.
So what do I suggest? What’s the best fastest way to produce energy & water miracles.
I would suggest doing all three.
1.)Continue to invest in start ups with promising energy and water technology.
2.)Put out bids online for anyone to solve specific energy and water problems
3.)Run high stakes water and energy contests. These contests would be as well publicized as American idol. So that the contest winners get get fame as well as fortune. But also contest contributors are honored.
I would suggest desalination contests: for desalination plants, pipelines and semi permiable membranes.
For energy, Mr Gates would have a better idea as to how to target prizes for energy. He mentioned three at the 2010 Ted conference: molten salt (thorium)reactors, TerraPower, portable nuclear reactors. More recently he has mentioned others.
As well Mr. Gates mentions here that the key to materials research (by which researchers can hasten energy and water innovation–among other things)is to accelerate the power of computer modeling.
A new formula allows computers to simulate how new materials behave up to 100,000 times faster than previously possible, and could drastically speed up innovation relating to electronic devices and energy-efficient cars. Princeton engineers came up with the model based on an 80-year-old quantum physics puzzle.
All you need to do to harness this new math is to hook the formula up to an algorithm and then integrate that into some big iron code.
As well, it probably wouldn’t be a bad idea to investigate Joule Unlimited a Harvard based company which promises promises to convert carbon dioxide and sunlight (with no biomass feedstock) directly into ethanol and diesal for $.60 @ gallon. They say their trials are already at about $1.20 a gallon.
My last suggestion — to add to this list is…. research funding and a prize should be given for the first internal combustion engine based on conversion of sodium ion (Na+) to sodium (Na) in water H20. This wouldn’t be used to power a car. Rather this could be used to power water pumps for pumping rivers of water inland. (For more info on this email me at ckilmer at gmail dot com.)
DARPA has been a good at running prize programs so they might be consulted for running the program. The WateReuse association is well embedded in the desalination community so they would be good to publicizing efforts to the desalination community. Dancing with the stars might be consulted to somehow make the whole show sexy. The media production of the show should be world wide.
How would you organize this activity. I think that Warren Buffetts Berkshire Hathaway provides a partial model. Create a corporation that billionaires can invest and use those investments to invest in start ups. And fund prize programs.
Now I began this article with the mission statement:
The healthy growth of mankind depends on continuously decreasing the cost of water and energy everywhere.
However, I only talked about the next great leap forward.
This is a problem.
Likely in only ten years (but no more than 30 years) the basic science and technology for collapsing the cost of transported fresh water and energy will be developed. Therefor in only a few short years it will become economical to turn the world’s deserts green. Mr Gates — and all the billionaires who follow his lead– who start out with the intent to do good –will wind up doing well. That is, if you follow Mr Gates energy investments, his thesis is that,– he can make as much money in the second half of his life as he did in the first half of his life just by investing his money well with a long term vision — like his friend the sage of Omaha, Warren Buffett.
Part of the deal Mr Gates might offer America’s billionaires is to suggest they mix their philanthropy with their investments. That is, philanthropists who give away money for prizes might earn the right to invest in just the companies that Mr Gates invests in. This effort would be organized in a kind of Berkshire Hathaway Corporation. Why would Mr Gates do this? Well, he has already said that the energy sector needs another 10 billion worth of investments than it is currently getting.
Well then the idea would be to use the profits to fund a foundation like the Gates foundation in 20 years whose mission statement is:
The healthy growth of mankind depends on continuously decreasing the cost of water and energy everywhere.
This foundation in 30 years would fund the R&D that makes it possible to harvest water and maybe H3 on the moon and mars and in space.
Does this sound like science fiction? Very well. Thank you Mr Assimov for your inspiration. And yeah. Thank you Mr Gates for your passion & vision. Thank you Mr Buffett for your patience and discipline.