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Fuel Cell Marvel "Bloom Box" Gaining Momentum
Many sources are continuing to excitedly report on the latest in a long line of startups chasing the holy grail of power sources. This incarnation, the "Bloom Box" from Bloom Energy, promises a power-plant-in-a-box that you can literally put in your backyard, and has received backing from companies like eBay, Google, Staples, FedEx, and Walmart. CBS recently aired an exclusive interview with K.R. Sridhar about his shiny new box. "So what is a Bloom Box exactly? Well, $700,000 to $800,000 will buy you a 'corporate sized' unit. Inside the box are a unique kind of fuel cell consisting of ceramic disks coated with green and black 'inks.' The inks somehow transform a stream of methane (or other hydrocarbons) and oxygen into power, when the box heats up to its operating temperature of 1,000 degrees Celsius. To get a view of the cost and benefits, eBay installed 5 of the boxes nine months ago. It says it has saved $100,000 USD on energy since."
Cool, they will pay for themselves in about 30 years.
It might save money but how is this technology greener?
To me it sounds like they're burning methane.
No sig today...
Methane fuel cells are nothing new and a certainly NOT perpetual motion machines. All that's really happening is that they're yanking off the extra electrons from the chemical reaction to generate electricity directly rather than burning the fuel and using a heat engine to harness the energy. No fuel, no energy.
What's novel about this is he thinks he can make them without the use of precious metals and other high costs that keep previous fuel cell designs from being adopted more widely.
They tried to gloss over it, but in the end it still takes in oxygen and releases CO2 while burning hydrocarbons. Sounds more like a more efficient version of current power systems than a alternative energy source.
The only upsides I can see is possible improvement in efficiency, decrease of cost, and less loss in transmission (since theoretically it's closer to whatever is using the power than a power plant). Now since they haven't actually given us any details on how these, I can't consider it a revolution.
That's not to say it wouldn't be good to buy some stock when it IPOs...just it may not be a good idea to hold it long
The missing piece in your math is government subsidization. In California, apparently there is a 20% direct government subsidy and a 30% tax credit, according to TFA on cbsnews.com, so the effective cost incurred to a company is only half the purchase price. If that means more like $350-$400k, that would be more like a 15 year payoff, which while still long, is definitely closer to being an attractive proposition for a business that can afford that kind of time horizon and can get asset-based financing at an attractive rate.
Assuming the median value of $750K/box, and that you need to save 5% of that per year to pay off a 5% mortgage, ($187k/yr, $140k/9-months) yes, they're screwed.
Very large corporate purchases that can get the business prime rate of 2.25% (Bank of Canada, today: http://www.bankofcanada.ca/en/rates/digest.html ) would only need save $67,500 per year to make interest, leaving this project with another $60K/year to pay down principal...probably a 25-year payback.
IF the bloom box lasts 25 years and has little in the way of maintenance or replacements the whole time. In short, yes, they have to drop the capital outlay to make this work. But not by much! They are nearly there now, and it's early days.
Also, you're forgetting the money-cost of carbon. Which is right, there isn't one. Nobody will impose one until there are alternatives that allow such costs to not send civilization to a grinding halt.
The Bloom Box is advertised as 60% efficient at turning methane energy into electrical energy. The best most heat engines can do is about 35% - and that's for huge, billion-dollar coal plants.
By going to gas-fired generation, our costs all nearly double compared to coal, but our carbon output drops by a good half. The Bloom Box could let it drop by three-quarters. Moreover, it effectively doubles the gas supply by using half as much to get the same electricity.
"Half" is good, but not good enough to level off carbon in the atmosphere. Three-quarters, now you're talking.
All that said, I don't imagine multi-billion-dollar, gigawatt Bloom Box power plants in our future. If they can indeed make the costs really drop, then I can see any kind of rural area, hard to put on the grid, going to these for distributed power generation.
And the developing world, where the grid hasn't reached half of humanity yet - well, it could be just huge. There's insane amounts of gas in Russia, an overland pipeline away from China and India, and nearly as vast amounts in the Arabian Gulf, not so far from Africa and less-developed parts of the middle east.
If these places can develop a low-carbon power solution, especially if China could quit opening a sulfurous brown-coal plant EVERY WEEK, it could be a big chunk of the solution.
I've heard rumors that energy prices might be volatile. Have you heard of this thing called "insurance", where you pay a set amount per month to prevent massive unexpected costs?
This is what separates the smart companies from the ones run by MBAs.
The issue isn't that it works, it's the volumetric efficiency of the storage. LP is nowhere near gasoline, and is very expensive. These are likely worthwhile because they convert natural gas (which costs about 1/3 to 1/2 LP, delivered, on a MMBTU basis).
It may be slightly better for the environment since it's burning^wconverting more H per C than gasoline, but it's still hydrocarbon based.
If I had to guess, this gives these players a stable, off-grid (aka backup) power source as backup while being cost competitive with local electrical rates. It sure as hell beats having to maintain diesel generators.
Is it just my observation, or are there way too many stupid people in the world?
I fail to see much appeal to these devices as regular sources of electricity; you still need hydrocarbon delivery (natural gas), you still give off CO2. It would make much more sense to do all the nasty hydrocarbon-to-electricty bits at a central location and use the grid to get the power to people. The grid is an abstraction layer; you don't have to care how the power is generated, you just end up with the results. The power plants themselves gain on economies of scale and can swap out their infrastructure gradually for future better technologies without the end user having to care. If these fuel cells are so great, they could be crammed into plants and put on the grid.
I do, however, see one very attractive use case: emergency power generation. Assuming your natural gas lines aren't interrupted (or you store your own NG supply on site), if you have one of these things around, you have backup power when the grid "goes away." This only makes sense if the price point gets low enough, of course.
And there are also benefits to local generation. According to the articles, the Bloom Box is supposed to be a more efficient electric generator than a full-size power plant.
I already mentioned that. It's not about the size; it's about the generator type. And the difference isn't really that much.
It becomes even more efficient (at the site) without transmission losses.
Transmission losses are tiny. They average 7.2% in the US, and commercial power needs will have lower losses than average.
It's more nimble to changes in fuel prices (switch from natural gas to syn-gas, ethanol, etc) than a power plant
[[Citation Needed]]. Really, is someone going to take your natural gas line leading up to your building and start pushing ethanol through it? Centralized locations are much more adaptive to change than countless smaller sites that need everything distributed to them in far lesser quantities.
as well as being under your own control
Relevance to the discussion of pricing?
You also only get one markup for buying the hardware and recurring costs for maintenance, rather than both of those costs (maintenance subsidized) with an additional markup for the power companies profits.
The power company's hardware is a *lot* cheaper per watt. Orders of magnitude.
Did you really name your son "Robert');DROP TABLE Students;--"?
The thing is that curve is already bent to green. Raw solar energy is basically free. The problem is that the conversion of sunlight to useful work (electricity), requires expensive devices. This is because a solar panel is essentially one big plate of high purity silicon, coated with pure unobtainium. If it was a sheet of scrap aluminium, an armada of bulldozers would be heading towards your local gas/coal powerplant. If batteries were made of scrap iron and plastic containers instead of high purity lithium, every car would be plug in hybrid, but the batteries are not. I'm not a "randroid", but the switch to clean energy would happen anyway. The government could accelerate it, but is the reduction of danger to the planet worth the economic cost? This depends on how severe the environmental crisis - some are real, but environmentalists have this nasty habit of exaggerating.
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So assuming the maximum cost -- $4M USD -- the investment on a Bloom Box would appear to take 30 years to recoup.
According to the representative of the company itself (so read sales-pitch), current funding and R&D rates are expected to drop the cost of the boxes significantly over the next few years:
Mr. Sridhar hopes the funding that's being virtually thrown at him and his enigmatic box will help drive down costs to below $3,000 for a residential unit within 5 to 10 years.
In fact, if you take time to read the whole article, which is a grand total of a whopping 12 short paragraphs, the entire thing reads like a, 'help the consumer make a decision,' cost analysis. That is to say, the article references the cost of solar panel installations currently (both by ebay and at a residential level).
EBay says the five boxes generate more clean energy than the company's 3,000 solar panels (assuming a bulk cost of $200/panel, and additional expense that system would run around $1M USD, at a minimum).
...
Such costs could certainly make the technology competitive with solar systems which cost anywhere from $20,000-$70,000 USD for home installations.
That said, I won't comment on the joy that we nerds take in performing our own simple math calculations to verify and or, 'discover,' various assertions made by a techie article. Nonetheless (all you must be ... jokes aside) the article was a pretty quick and simple read that discusses in a fairly competent manner whether or not the Bloom Box is hype or not. The final conclusion it draws, however, is terribly unhelpful:
So is the "magic" box a stud or a dud? It's hard to tell. About the only thing that's for sure is that Wednesday's announcement should be intriguing.
So really, the apparent intent for the article, is that this is a press release being used to garner attention for an even more important press release to come in two days.
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Natural Gas is (mostly) methane, you know that right? Right now energy companies practically throw it away, and what little they do sell they sell for dirt cheep because the market is so small. Up on the North Slope, and indeed anywhere oil is produced, we are sitting on massive quantities of the stuff, and generally the oil companies just pump it back down the holes to push more oil up.
Getting it to market en-masse would be cheap, the infrastructure is already there, as natural gas is ubiquitous as it is even though we only use a small percentage of what is available. The price of gas would not raise much, because only a demand a slightly higher price are needed to make it more valuable to ship out than to pump back down the holes.
How the hell do you think they are saving $100,000+ per year on these things? Magic?
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Now, if the Bloomberg fuel cells bypassed the generation of heat and converted the energy content of the Natural gas directly into electrical energy
It does, to an extent. That's the reason the operating temperature is 1000 C instead of the usual natural gas flame temperature of near 2000 C. It is a catalyzed reaction.
Furthermore, ANY electrical power generating plant has a maximum theoretical efficiency of 50% for the energy it consumes.
I'm not sure where you got this but it is not at all true.
"I assumed blithely that there were no elves out there in the darkness"
The fact you put 'magic' at the end of that question is hilarious. Quite a bit of the problems we have right now are due to 'magic' accounting. Unless I can actually see all the numbers I don't think we can be sure they are actually saving that amount of money at all. In the last 10 years I have learned to be pretty gosh darned cynical and suspicious about other people's accounting. Just like the earlier article today where Symantec was claiming that 100% of all enterprises had losses due to cyber crime.
Who the heck knows how they are accounting for that $100,000. I would rather know the numbers relating to how much energy it produced, how much fuel it consumed, etc. Let me make my own analysis on what it would save me.
That's not true at all. The delivery systems are everywhere but we are not using a 'small percentage' of what is available.
Natural Gas cannot be transported by anything other than pipe lines that exist now. Ohhh, some companies will tell you that they can. They are trying to do so, but the first ship that explodes in the Atlantic killing all marine life within 25 miles will put a stop to that. Put simply, it is extremely dangerous. There is a reason why the Interstate Natural Gas Pipelines exist.
Natural Gas will more than likely be depleted within the next 20 years. It's not just corruption (Enron) that was increasing the price of Natural Gas nearly 5 times in the last 10-15 years. Right now it is hovering around $5, but it will go back up pretty quickly.
The pipelines themselves only hold a small fraction of what is actually transported through them each year and would last up to two weeks once we stopped feeding them.
It's a pipe dream (no pun intended) to think Natural gas will solve anything. There is not enough exploration occurring right now. In fact, due to the economy, well over 75% of all working rigs in the United States, are *not working*.
So unless a massive, massive, Natural Gas field gets discovered AND we start putting all of our rigs out there working on it, gas prices are going to climb upward FAST.
I just find it funny when people mention Natural Gas as abundant when it really isn't.
It's not about paying for itself, it's about eating your own dog food. Bloom Energy, Google, Yahoo, Segway, all financed from the same cabal of VCs, and the way you score revenue in that business is to trade each other your stuff and then count the trades as revenue in both directions. Kind of like two real estate guys selling each other the same two condos, until the price is bid up to a level worthy for sale to some suck^H^H^H^H other investor. Hey, it worked in 1999, why not now?
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