If electric cars are the answer, what’s the question?

An eVgo charging station

An eVgo charging station

Like many environmentalists, I’d love to see lots of people driving electric cars. If  broadly adopted, electric cars will go some way towards limiting air pollution, reducing greenhouse gas emissions and undermining the power of oil oligarchs in the Arab world and elsewhere. Electric cars produce what economists call “positive externalities,” that is, consequences that benefit people other than their owners.

But what problem to do they solve for electric-car owners? That question has been on my mind since my recent visit to Israel, when I drove a Better Place car and experienced, first-hand, one of the obvious drawbacks of electric vehicles: They don’t go very far without refueling. [See my January blogpost, Better Place is alive but not well.] This is a problem not just for Better Place, but for other sellers of pure electric cars, like the Nissan Leaf and the Tesla Model S.

Today, I took a closer look at Better Place in a story for the YaleEnvironment360 website. Here’s how it begins:

If you want to sell electric cars, Israel looks like a great place to start. It’s a small country, with most people clustered around Tel Aviv and Jerusalem. Gasoline costs more than $7.50 a gallon, and oil revenues help support Israel’s Arab foes. So it’s easy to understand why Shai Agassi, an entrepreneur who was born in Israel and made a fortune in Silicon Valley, chose to launch his Better Place electric-car company in Israel, while preparing plans to expand in Europe, Australia, Japan, China, and the U.S.

What’s harder to understand is why things have gone so badly. Better Place, which staked out its position in the electric car market with an innovative battery-swapping technology, has sold only about 750 cars in Israel, while piling up losses of more than $500 million. Agassi was forced out of Better Place in October, his successor as CEO quit in January, and the company has put its global rollout on hold. Better Place needs to raise more money this year, and that won’t be easy, insiders say.

Start-ups often stumble, of course, but Better Place’s woes raise questions that matter to anyone who cares about electric cars and their future in a low-carbon economy. Has Better Place sputtered because of its own mistakes, or are the company’s difficulties a sign of the broader challenges facing electric cars?

As part of my reporting (much of which didn’t make its way into the story) I spoke to executives at General Motors, Nissan, the charging network eVgo and others, to see how electric cars are faring here in the U.S. Last year, Americans bought 52,000 all-electric cars or plug-in hybrids–vehicles, that is, designed to run primarily on electricity, like the Leaf,  the Chevy Volt and the Tesla. That’s about 0.35% of U.S. car sales, which topped 14.5 million in 2012. By comparison, the best-selling passenger car, the Toyota Camry, sold 405,000 units, without, incidentally, the benefit of the billions of dollars in government loans, grants and tax credits that have flowed to the electric car industry. EVs have attracted lots of attention but they have been slow to penetrate the mainstream. [click to continue…]

For green business, blue skies ahead. For climate policy, who knows?

The renewable energy and clean tech industries let loose a collective sigh of relief today. President Obama’s re-election means they still  have a friend in the White House.

Clean energy was a big winner yesterday,” said Frances Beinecke, president of the Natural Resources Defense Council. “American voters not only re-elected a president who made green jobs a cornerstone of his first term and his campaign, they also rejected some of the shrillest champions of Big Oil and Big Coal.”

As Nick Robins, HSBC’s climate research analyst, said today:

Obama’s victory essentially protects key climate policies from repeal, particularly the regulation of carbon dioxide by the EPA, most notably in the power and auto sectors. It also offers the chance of extending the Production Tax Credit for wind energy when it expires at the end of this year.

True enough, but the today’s inefficient, hodge-podge collection of EPA rules, clean-energy subsidies and state mandates — while better than nothing — is no substitute for a rational economy-wide policy to deal with climate change.

Could this election usher in a carbon tax or cap-and-trade regulations to limit global warming pollution? That’s impossible to know,  but there’s no evidence that climate action has climbed to the top of the president’s to-do list.

Obama made a passing reference to climate change in his acceptance speech, saying: “We want our children to live in an America that isn’t burdened by debt, that isn’t weakened by inequality, that isn’t threatened by the destructive power of a warming planet.”

But his all-but-absolute silence about global warming during the campaign means that he has no mandate from voters to act on the issue. Worse, he has made close to zero effort to persuade Americans that the issue matters, a failure that will surely cast a shadow over his legacy if it isn’t rectified during a second term.

To see what’s next for climate and green business after the election, I reached out to some smart people in the business world and in Washington to see what opportunities, if any, they see.

The first, and maybe the best, opening will arise when the president and the lame-duck Congress face the so-called fiscal cliff in the next 60 days. The government will need revenue to avoid painful spending cuts and tax increases, and a tax on carbon emissions could become an option. [click to continue…]

Is CoolPlanet Biofuels too good to be true?

Imagine a company that says it can produce virtually limitless amounts of cheap gasoline, create arable land for food production and solve the climate crisis–all at once.

That’s the promise of CoolPlanet BioFuels.

Mike Cheiky

Mike Cheiky, the company’s founder and CEO, spoke about CoolPlanet’s “negative emissions technology” at Brainstorm Green, FORTUNE’s conference about business and the environment. Yes, negative emissions.

Does that mean, I asked him, that the more you drive a car powered by CoolPlanet’s biofuels, the more CO2 will be pulled out of the air? Yes, he replied.

“The world doesn’t have too much carbon,” Cheiky explained. The problem’s is that the carbon’s in the wrong place. There’s too much in the atmosphere, causing global warming,  and not enough in the soil. Essentially, Cool Planet has a plan to use plants to remove it from the air and then restore it to the land.

Before you decide that this is too good to be true, you should know that Cheiky, a veteran entrepreneur, has persuaded Google, General Electric, BP, ConocoPhillips, NRG Energy, Exelon and venture capital firms Shea Ventures and North Bridge Venture Partners to invest millions of dollars–he won’t say how many millions–in CoolPlanet Biofuels.

“We have been poked and prodded so many ways by so many people,” Cheiky told me. “GE sent 17 people to do their due diligence at a time when we had only 15 employees.”

These investors wrote him checks, he added, because of his track record. “I’ve done six start-ups in my career,” he went on, “and I’ve never had a down round. They’ve all been very successful.” [click to continue…]

An Atlantic wind project: big, bold and risky

Building a low-carbon economy requires bold ideas and long-term thinking on a scale that matters.

Ideas like The Atlantic Wind Connection.

The Atlantic Wind Connection,  you may recall, is a company that has embarked on a multi-billion dollar, decade-long project to build an undersea transmission cable stretching about 350 miles from northern New Jersey to southern Virginia. (See my 2010 blogpost, Google’s Atlantic coast wind deal.)

It will bring down the cost of offshore wind projects, create a more reliable electricity grid along the east coast and create thousands of jobs. The Atlantic Ocean is well-suited for offshore winds because its relatively shallow waters extend for miles out to sea, so turbines can take advantage of stronger winds and they are barely visible from land.

“It’s a scalable platform that literally creates a superhighway for offshore wind,” said Michael Terrell, who leads energy policy at Google, a major investor in Atlantic Wind. [click to continue…]

NRG Energy: Hoping to score big with solar

The view from the NRG suite at Redskins Park

The Washington Redskins played with enough energy to send Sunday’s game against the Dallas Cowboys into overtime, but by the time the ‘Skins fell to their sixth consecutive loss, my host at Redskins Park  — David Crane, the chief executive of NRG Energy — had left. Actually, he exited before halftime . . . to attend another NFC East showdown, the Giants-Eagles prime time game in New Jersey.

No, Crane is not a football fanatic. But the affable 52-year-old CEO is fanatic about promoting solar power, which is why he’s been spending time lately with NFL owners. NRG installed solar panels last summer at Redskins Park [See my blogpost,  An NFL rivalry…over solar], and he would like the company, which is based in Princeton, N.J.,  to deliver solar energy to the stadiums where the Giants and Jets, Philadelphia Eagles and New England Patriots play.

Why? To show people–particularly the influential, well-to-do types who attend NFL games–that solar energy makes sense, today.

“This is about demonstrating to the public the potential of solar,” David told me, as Dallas jumped to an early lead.  and we made our way up to the front of the suite. “I just want to make sure I see at least one play before I go,” he said, ruefully.

David Crane

Most utility company CEOs are, frankly, dull. Not Crane. He’s straightforward and occasionally outspoken, friendly and open, and ready to think in new ways about an industry that hasn’t changed all that much since Edison’s day. He is passionate about the climate crisis–he was active in USCAP, the failed big biz-big green coalition that lobbied for federal regulation of greenhouse gases, and he pushed hard to build a low-carbon nuclear plant in Texas until the risks grew too high post-Fukushima. He’s a friend of the Clintons, which is one reason why NRG made a $1 million contribution through the Clinton Global Initiative to deliver solar power to Haiti.

Now he is pushing hard for rooftop solar, smart meters and electric cars–a set of technologies that has the potential to transform the way utilities operate. [click to continue…]

An NFL rivalry…over solar

Dan Snyder, the owner of The Washington Redskins, is not exactly a tree-hugger. To the contrary, he once offered to pay the National Park Service $25,000 to cut down trees on federal land near his estate overlooking the Potomac River. So when Snyder embraces solar power, by installing more than 8,000 solar panels at FedEx Field, well, that tells you something.

It tells you that the economics of solar make sense–because Snyder is known for extracting every dollar he can from the business of the Redskins.

It also tells you that he’s a competitor.  The Redskins deal with NRG Energy, a Princeton, N.J.-based independent power producer,  took root at last year’s Super Bowl, after the NFL East rival Philadelphia Eagles announced that they were installing solar, wind and biofuel energy at Lincoln Financial Field. [See my 2010 blogpost, Climate leaders: Chevy, NRG Energy and the Eagles].

No surprise, then, that the Redskins/NRG announcement made a point of calling the solar project “the largest installation at an NFL stadium.” It’s also the largest solar installation in the Washington, D.C., metro area.

While I prefer baseball to football, and the New York Giants to the Redskins (despite last Sunday’s game), I made the trek  to FedEx field by Metro today to see the solar panels and hear what Snyder and David Crane, the CEO of NRG, had to say about them. [click to continue…]

NRG’s David Crane: straight talk about energy

Washington may be stuck in neutral–or worse–when it comes to climate policy, but NRG Energy and its chief executive, David Crane, are aggressively pushing clean energy.

NRG Energy is investing in nuclear power, solar energy (photovoltaic and utility-scale solar thermal) and electric cars. It’s powering the Empire State Building. It’s even helping to finance off-the-grid solar power in Haiti.

“Washington is not filled with people who are going to lead,” Crane says. So it’s up to business to show the way.

I interviewed David Crane at the State of Green Business 2011 forum in Chicago. He’s always a pleasure to talk to because he’s brimming with ideas and tells it like it is. Based in Princeton, N.J., NRG is a $9 billion a year independent power producer that operates coal, nuclear, natural gas, wind and solar plants.

Here are some highlights from our conversation:

On nuclear power: “Nuclear is the ultimate green solution, if what we are solving for is climate change,” Crane said. NRG wants to build a new 2,700 MW nuclear faciity in Bay City, Texas, next to an existing plant. It would supply enough energy to power 2 million Texas homes. The project requires federal loan guarantees and progress through the regulatory system has been slow.

Despite strong support for nuclear from President Obama, Energy Secy Chu and Republicans in Congress, the U.S. is likely to build no more than two new nuclear power plants in this decade, “which is not exactly a nuclear renaissance,” Crane said. [click to continue…]

The hidden costs of solar power

In this sluggish economy, you would think that selling expensive electricity to businesses or homeowners would not be a good business. But the solar-power industry is doing exactly that. Solar power is more expensive that making electricity from natural gas, coal, wind or existing nuclear plants, and yet the business is booming. [See: U.S. solar power: doubling in 2010!]

Hardly a day goes by without good news for the solar industry. For example:

BrightSource Energy, Inc. just announced that power generation company NRG Energy will invest up to $300 million to become the biggest owner of the  Ivanpah Solar Electric Generating System, the largest solar thermal system in the world, just beginning construction in California’s Mojave Desert. Gov. Schwarzenegger and Interior Secy Ken Salazar joined in a groundbreaking today. That’s a mock-up of the Ivanpah plant, above.

And:

SunRun, a California-based home solar company, said this week it received an additional commitment of tax equity from an affiliate of U.S. Bancorp to develop 1,900 residential solar installations. Given that the typicalinstallation costs about $35,000, that’s roughly a $65 million investment. SunRun has now raised more than  $300 million in project financing.

Recently, I visited a solar PV manufacturer,  Solyndra, at its headquarters in Fremont, CA. While Solyndra is worried about competition from low-cost manufacturers in China, it is still selling all of the photovoltaic panels it manufacturers. Recently:

It announced deals to installs its cylindrical solar panels on the roof of a Frito-Lay manufacturing plant and on rooftops in the Los Angeles area that will supply 16.2 MW of power to Southern California Edison.

None of this comes cheap, although calculating the cost of solar power is not simple–it depends on the kind of system in place, its location and the costs of financing, since “fuel” from the sun is free. Solarbuzz, a respected source, says that:

Solar Electricity Prices are today, around 30 cents/kWh, which is 2-5 times average Residential electricity tariffs.

According to the Energy Information Administration, the average residential price for electricity in June was 12 cents/kWh, the  average commercial retail price was 10.70 cents/kWh and the  average industrial retail price was 7.31 cents/kWh.

So why do the economics of solar power work for the industry? The answer, you won’t be surprised to learn, is generous government subsidies. [click to continue…]

Why the “Petro Metro” wants electric cars

Why on earth would Houston, the city of drill-baby-drill, the fossil-fuel capital of America, the city whose NFL franchise used to be called the Oilers, embrace the electric car? For good reason, it turns out–so says the city’s mayor, the local utility company, Reliant Energy,  its parent company NRG Energy and NRG’s CEO, David Crane.

“Houston’s not a natural market for electric cars,” Crane admitted, when we met the other day. “But electric cars are good for our business in all kinds of ways,” he added. So NRG and Reliant is working with officials Houston, America’s 4th largest city, to persuade Nissan to make Houston one of the leading launch markets for the Nissan Leaf, the all electric vehicle that the Japanese automaker plans to start selling later this year.

Houston's skyline at night

Houston's skyline at night

“We are the Petro Metro, but we are also a car city,” said Houston’s newly-elected mayor, Annise Parker, at an event earlier this month to welcome Nissan to the city. Certainly there’s a sizable market awaiting Nissan in the city. Houston is home to 4.5 million vehicles that travel 86 million miles a day, according to Reuters.

The problem for Houston–and for most other cities that want to welcome electric cars–is that it lacks an infrastructure of charging stations where electric car owners can fill up their cars with, er, electricity. This winter, Nissan took the Leaf on a three-month, 24-city tour designed to spark excitement about the car, a five-passenger car that the company says will travel about 100 miles on a single charge.

But because the Leaf will be produced in limited numbers, at least at first, the tour was also a way for Nissan to solicit partners, mostly cities and utility companies, that will assume the costs of building charging stations that will allow electric car drivers to overcome what is known as “range anxiety”–the feeling that they might run out of electricity without a charging station nearby. [click to continue…]

Bill Gross’s solar breakthrough

“We are producing the lowest cost solar electrons in the history of the world,” Bill Gross is telling me. “Nobody’s ever done it. Nobody’s close.”

Bill Gross is nothing if not an enthusiast, which makes him a great salesman for whatever it is he happens to be selling. A lifelong entrepreneur, a longtime evangelist for solar energy and the CEO of eSolar, a Google-funded startup that designs and develops concentrating solar power (CSP) projects at utility scale, Gross is one of the most interesting business people I’ve known.  I met Bill in 2002, when I wrote a critical story about him for FORTUNE – investors in Idealab, his Internet incubator, were suing him after the dot-com bubble burst – and although he and his wife, Marcia Goodstein, were more than mildly irritated with me then, we’ve reconciled and I now count myself as an admirer of Bill’s. He’s always got a million things going on, some of them slightly nutty, but all of them interesting.  He’s in the robot business with a company called Evolution Robotics and he’s the founder of Aptera, a very cool electric car company (in which Google has invested) that I wrote about last spring.

Today, Bill and eSolar are staging a grand opening for eSolar’s first plant, called the Sierra SunTower, located in the southern California desert near Lancaster. Below are a couple of photos, taken by Bill, from a helicopter ride over the plant on July 3. He sent them to me via Picasa, the photo sharing site now owned by Google, which he founded back in the 1990s. Like I said, he’s a serial enterpreneur. (Bill also invented the idea of paid search, but that’s another story.)

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