Last night, Tesla CEO Elon Musk showed he’s getting more like Steve Jobs by the minute. Just as Jobs helped revolutionize the personal computer, music and phone industries; Musk has helped revolutionize the world of e-commerce, space exploration and electric cars. And now he’s set his sights on the energy sector. With this announcement, Musk has burnished his revolutionary status by revealing that Tesla Motors is no longer “just” a car company, but an energy company. You can read the 12 key facts of last night’s presentation here. Some commentators are calling it the start of an energy storage revolution, but there are no guarantees.
Here are some highlights of our conversation (edited for length and clarity):
Fergus Nicholl: Elon Musk…you’ve met the man. How would you introduce him to a global audience?
Alison van Diggelen: He is a genius inventor…the (Thomas) Edison of our day…incredibly sharp minded, a big old geek, but he’s very personable. He has grand visions and wants to make it happen…he has the ability to paint a picture, and motivate a team and build a team. He’s changed the world of electric vehicles and he’s now planning to change the world of power, utilities and battery storage.
Fergus Nicholl: That is an application that would apply in many many countries, beyond India. The idea that you could weather blackouts, brownouts…you’re saying you could bank it, use it when you need it and not necessarily get hit by little domestic crises?
Revathy Ashok: Absolutely. It’s pretty common in India for a normal household to have a one to three hour battery back up.For the last 12 hours it’s been raining heavily…we’ve had no power at all, so all connectivity is lost. I have three hours of battery backup which is all gone…
Alison van Diggelen: The main idea is, if you’ve got solar panels on your roof, or windpower, your house can become a power station with the addition of these batteries. No matter what natural disaster, earthquake etc. is happening, you will have a reliable source of power. You won’t need the utility anymore. You can just disconnect from the grid, go “off-grid.” So that’s the huge potential and that’s why people are really excited about tonight’s announcement.
Fergus Nicholl: The Gigafactory (in Nevada)…tell us more about it…a net zero energy factory…it’s quite an extraordinary project.
Alison van Diggelen: Yes, a net zero energy project means it will be solar powered itself and will produce as much energy as it uses to make these batteries. It’s definitely quite revolutionary and has Elon Musk’s fingers all over it.
Fergus Nicholl: In this picture, the entire roof is vast solar panels, kind of like a solar farm laid perfectly flat. I guess Nevada is probably the best place to be for that?
Alison van Diggelen: Indeed, several states were actually fighting over it. California was hoping to get it too, but Nevada won out because they gave some very juicy incentives…The Gigafactory will produce more batteries, once it’s fully operational, than the world’s supply of batteries in 2013. That’s what they’re predicting. It’s a mind blowing amount of batteries and Tesla board member, Steve Jurvetson told me they’re planning to build more Gigafactories around the world, once this one is operational. As well as being Net Zero, they’re going to be creating a lot of employment, so there will be a lot of communities wanting them in their back yard too.
Fergus Nicholl: They’ll be lining up in different countries…
***
Note: We didn’t have time to discuss the competition that Tesla will face in the battery storage space. There are already major players like Samsung, LG Chem and Mitsubishi working on energy storage solutions and a slice of what Deutsche Bank estimates is a $4.5Bn market. The question is, will Tesla’s strong brand and reputation for quality emulate what Apple achieved in the cellphone market, and leapfrog over the existing competition? In his usual hyperbolic (Steve Jobs) fashion, Elon Musk said last night that “existing battery solutions suck.” But the success of his high risk venture in the energy storage market will depend on swift execution and competitive pricing that makes the Tesla Powerwall a viable solution for a wide spectrum of potential buyers, from wealthy consumers and businesses in California to rural communities in India, Africa and beyond.
Here’s an extract of our conversation about Tesla’s new battery storage products:
Alison van Diggelen: Tesla has a big announcement next week about batteries. Of course, I’m not going to ask you to preempt Elon Musk’s announcement…but give us the case for battery storage. Why is Tesla going into battery storage for the home and utility scale?
Steve Jurvetson: This may be the first peek into a unified theme across companies. So as people know, Elon Musk is an incredibly prolific entrepreneur, having come up with, or been at the founding team of Tesla, SpaceX, SolarCity, PayPal, all different industries that seem to have nothing to do with each other.
Now the troika of perhaps SolarCity, and the Gigafactory (which is an incredible initiative underway in Nevada right now), and Tesla comes into light for the first time: There is synergy. Say 20 years out, there’ll be a distributed utility where Solarcity has the solar cell installation, leasing and basically ownership, installation and the whole shebang, actually building panels as well for solar on homes, everywhere.
Well, once you get enough of that (last I checked they have around 40% market share in the US) you start to generate so much energy that you are like a variety of utilities combined, but it’s ephemeral. If you’re not using that energy when generated, it goes away. So right now, you push it to the grid and it’s expected the utility can use it, especially since solar is produced at peak hours. But what if you wanted to get rid of the grid altogether? You’d need distributed storage …if every solar cell came with a big battery that could smooth out your daily needs, then you could just disconnect from the grid. You could certainly lower the generation capacity of the grid…that pushes on fossil fuels and nuclear.
How to pull that off? As a customer of Tesla and SolarCity I see my solar cells and I see my car and think, can’t we just connect these together? If I need to suck energy out of my car, I can use it to buffer the load from my cells, but it’s not so easy…
Part of the synergy and leverage is that Tesla is planning to build an enormous plant of batteries, anticipating the 3rd generation vehicle…you’re going to have some excess capacity, potentially for some period of time as you ramp up.
There will be blocks when you produce a lot more batteries than you might need in that particular month…well what are other interesting things you can do with them? What would you do with those batteries at the end of life of a car? Those battery packs are really useful for secondary storage uses.
For folks who don’t know this…the Gigafactory isn’t named that just out of hubris. It would be the largest factory in the world by footprint and they’re going to eventually build many of them. That one factory alone at scale would exceed global capacity today. So this is an unfathomable amount of batteries.
I really have to credit Elon for realizing that these numbers pencil out to be so enormous and to share that with the world, before he had the solution in the bag.
van Diggelen: Talk about the utility scale side. If you were a utility…in charge of PG&E today, talk about how you’d be feeling and what you might be doing to deal with this?
Jurvetson: On the one hand, you’re threatened by solar and you’re going to do all your dastardly deeds to try to quench and kill innovation, because that’s what big companies do, it’s in their blood. That’s what they’re expected to do.
But on the other hand, they need this too because whether by mandate or the goodness of their hearts…so mandate…they do more wind, do more solar. Many of those wind farms you see, on Pacheco Pass, they’re not doing anything useful. They may be spinning but they’re not even hooked up sometimes. There are rules and regulations to generate the capacity but not to actually make use of it. So part of the problem with time shifting is you have different needs at different times, wind is often a nighttime peak, so storage is needed throughout to pump water…there are all kinds of things you can do….in demand response. There’s a lot of inefficiencies in the utilities where they’ll build peaking gas fired power plants that are just turned on for a few hours in the year at most for those peak needs. So all that infrastructure just because you couldn’t do needs sharing or have the capacity to buffer.
If you had big old battery sitting there on the grid, you wouldn’t need that. So distributing that allows you to put it near the point of consumption and point of generation in a solar context.
van Diggelen: What are the markets for these utility scale batteries? Would it be companies like Apple that are going solar in a big way or is it to sell to PG&E?
Jurvetson: Good question. In general, there’s a whole cascade of markets: everything from consumers for their home, businesses and utilities themselves. The utilities can go to all kinds of technologies, even Telcos like for a cell phone tower you need storage there as well, especially in places like India and elsewhere.
There are technologies like flow cell batteries, compressed air solutions being developed…there is a variety of ways to approach this. Tesla’s approach is just leveraging what they know best which is lithium ion chemistry and batteries and a battery management system…so you can potentially address a whole range of these.
van Diggelen: So it’s the same batteries they use in their car?
Jurvetson: Exactly…
***
Check back soon for more highlights from the Steve Jurvetson interview.
“We are standing on dry grass, and we should be standing on five feet of snow,” Mr. Brown said. “We are in an historic drought… a new era…The idea of your nice little green lawn getting watered every day, those days are past.”
Although the governor’s mandate calls for a 25% water use reduction, it probably won’t go into effect until June and will barely impact the farming community, which accounts for 80% of the state’s water use (almond farmers alone use 10%). According to a report by Lisa Krieger, the CA Department of Water Resources confirms that agriculture water use has already been heavily restricted, however the new rules will not restrict groundwater pumping.
Experts at NPR’s KQED say the most worrying part is that this crisis is a glimpse of the future: the low rainfall and high temperatures we’ve experienced in the last four years are now the “new normal,” thanks to climate change.
Here’s an extract of our discussion that starts at 29:00 in the BBC podcast:
Hearing: We know California is sunny…but it’s rather too sunny and not quite rainy enough…and for the first time in the state’s history you have mandatory water restrictions. How does it affect your life and what’s going on there?
van Diggelen: Yes, this is big news here. Governor Brown went up into the Sierra this morning and he stood where normally there would be about five foot of snow and he was on grass. It was such a powerful image to relay to people the extent of the problem: 2013 was the driest on record in the state, 2014 was the warmest. It was like a one-two punch for the environment and finally he’s getting round to doing something. A lot of people, myself included, are asking: Why didn’t you start something a year ago? We saw this coming…(A recent San Jose Mercury News editorial describes Brown’s action to date as “lame.”)
Hearing: What’s it actually look like? Do you notice the lakes ebbing away, the rivers drying up?
van Diggelen: There are a lot of reservoirs in the south San Francisco Bay area that are completely dry or close to being dry. A lot of locals are letting their grass go brown. There are a lot of visible ways of seeing this, however you’re also seeing beautiful verdant grass on golf courses, so you could say there is a cover up going on. This is long overdue, there really needed to have been mandates before this, but at least there is something happening now. Gov. Brown is calling for reduction in water use of 25% for the next year.
Hearing: But he can’t make rain. Is there any sign of it coming?
van Diggelen: Our rainy season is almost over. We’re now in April and the majority of our rain falls between September and March, so it’s not looking likely. We may get one or two light showers, but the experts are saying the window of opportunity for a big storm has passed.
Hearing: It’s going to be a long hot summer.
***
Toward the end of the program (at 48:45 in the podcast), Don McLean fans will be interested to learn that we discussed the “American Pie” manuscript, which goes to auction on April 7th. I couldn’t help remarking how relevant the classic contemporary song is to California today:
“I drove my Chevy to the levee, but the levee was dry.”
Sadly, as climate change progresses, dry levees, lakes and rivers are going to be a widespread sight in California. Indeed, that and brown lawns are going to become “the new normal.”
Tesla CEO Elon Musk is so bullish about self driving cars and the promise of artificial intelligence, that he wonders if one day, there will be “something left for us humans to do.” Today he joined Nvidia CEO Jen-Hsun Huang onstage at the company’s annual developers conference in Silicon Valley and used the opportunity to recruit for Tesla’s autonomous driving team.
“Tesla is the leader in electric cars, and we’ll also be the leader in autonomous cars…at least autonomous cars that people can buy. If anybody is interested in working on autonomous cars, we’d love to have you work at Tesla. We’re going to put a lot of effort into autonomous driving…it’s going to be the default thing…it will be extremely transformative,” Elon Musk.
Musk, who Huang describes as an engineer’s engineer, views autonomous driving as “a solved problem” and expects that once its life-saving potential is proven, we’ll all take autonomous cars for granted.
“We know exactly what to do and we’ll be there in a few years,” Musk says. Yet he acknowledges that although freeway driving and driving under 10 mph are (relatively) easy problems to solve, “in between is hard,” especially in suburban areas where there are children playing, roadworks and other unexpected obstacles.
Huang was keen to explore what Tesla’s big announcement will be on Thursday, something Musk has described as providing “an end to range anxiety.”
But Musk was tight lipped, though he did explain how Tesla’s software system is like the human brain in only using a small part of its capacity. The company’s ability to offer regular software updates allows the Model S performance to continually improve over time.
“The first thing we want to do is establish the hardware platform, make sure we have the sensors and computing power, even though the software is only taking advantage of a small percentage of the sensors’ compute power and we do continuous updates to make the car more and more capable. We’re going to see a lot of that happen later this year. If I didn’t have an announcement Thursday, I’d be saying a lot more,” Elon Musk
Road Blocks
Is Musk concerned about big government thwarting big advances in autonomous vehicles?
Not in the least. He appreciates that where public safety is concerned, a cautious approach is necessary and he anticipates that a green light will come from regulatory authorities approximately two years after autonomous driving teams prove their vehicles are safer than humans.
“Regulators will want to see a large amount of statistical proof…but the evidence will be overwhelming,” says Musk. He even anticipates that one day (in the far future), humans driving cars may be illegal because, after all, “You can’t have a person driving a two-ton death machine.”
High speed rail in California was virtually dead, but California Governor, Jerry Brown brought it back from the brink. How did he do it?
I joined BBC Business Matters recently to discuss how Brown gained support for this controversial multibillion dollar project. Despite lawsuits, funding shortages and vocal opposition, the California High Speed Rail Authority began construction in January this year. Here’s a transcript of our conversation (@32:20).
BBC Host, Dominic Laurie: Why aren’t Americans so convinced about high speed rail?
Alison van Diggelen: I think they love their motor cars, or their electric cars now. But (CA Governor) Jerry Brown is a huge advocate for train travel and they are moving ahead. They have already broken ground on the high speed train between San Francisco and LA. That is moving ahead, despite a lot of opposition.
Laurie: So that’s going to happen finally? It’s been talked about for years hasn’t it?
van Diggelen: It still faces a lot of opposition, but they have broken ground and they’re doing it in sections.
Laurie: Why the change? Why have they started to believe in that?
van Diggelen: Jerry Brown has really pushed it. He’s put his strong political backing behind it. I said one time when I interviewed him, “How can we afford it?” (California was seriously in debt at the time)
And he said, “How could the French build the Cathedral of Chartres?” (In other words) we have to invest in the long term. He’s a very eloquent, powerful speaker and he’s managed to get support for this.
***
Despite fierce opposition and vast funding shortfalls, Jerry Brown continues to fight hard for HSR. He’s focused on the enormous environmental benefits of the finished product: 10 million fewer miles of vehicle travel every day in California by 2040; at least 80 fewer flights a day; and a big reduction in greenhouse emissions. He also hopes to use some of the $1Billion the state has secured in greenhouse gas fees. Of course, he’s also thinking of his legacy, and he just loves using big words to ridicule his anti-HSR foes. Words like “pusillanimous.”
During their speeches, Brown and other dignitaries took swipes at rail foes while touting the project’s benefits. “Everything big runs into opposition,” Brown said, citing the California Water Project, the Golden Gate Bridge and BART (Bay Area Rapid Transit). “People do get pusillanimous. That’s the adjective I’m going to affix to all the critics. … It means weak of spirit.”
“You’ll always have critics (say), ‘Why spend the money?’ ” he added later. “My inclination is not to spend anything. But on the other hand, I like trains. I like clean air. I like to protect as much of the land as we possibly can. And I like to enjoy the comfort of trains.”
Brown said the estimated $68 billion cost for the complete 520-mile Phase 1 bullet-train system between Los Angeles and San Francisco is relatively small compared to California’s economic power. “California generates over $2 trillion a year. … All this is is $68 billion of that” for a system with a 100-year lifetime, he said. “It’s not that expensive. We can afford it. In fact, we cannot afford to not do it as we look at building a future that really works.”
One final thought: Wouldn’t you love to hear a conversation between Brown and another train advocate with a penchant for sesquipedalian words, London’s Boris Johnson?
News that the Koch Brothers are planning to raise almost a billion dollars in the run up to the 2016 Presidential election is sending shock waves through U.S. politics. The Kochs are closely linked to the Heartland Institute, an organization described by the BBC’s former environment correspondent, Richard Black as follows:
To itself, it’s a think-tank; to critics, it’s a lobby group, paid to oppose regulation on a number of fronts – including climate change. It’s probably most notable (or notorious) for holding an annual “climate-sceptic” conference in Washington DC.
On the other side of the climate arena is Tom Steyer, a self-made billionaire who launched Next Gen Climate, a Super PAC with the following mission:
“Working at every level, we are committed to supporting candidates, elected officials and policymakers across the country that will take bold action on climate change—and to exposing those who deny reality and cater to special interests.”
Steyer put $74 Million into the 2014 elections, targeting Republican candidates who reject climate science.
Here is a transcript of our conversation. It has been edited for clarity (starts @35:00 above, 32:00 on the BBC podcast)
Roger Hearing: What do you think is the effect of money in this scale – we’re talking a pretty massive scale – on US politics?
Alison van Diggelen: It is massive and it seems to be growing. It’s a little bit scary. I can assure you, because I cover climate change, I’m very aware of the Koch brothers. They’re secretly funding climate denial, basically a climate denial machine…
Hearing: Can you explain that?
van Diggelen: They have been funding various foundations with wonderful names that you’d think you would get behind, like the Heartland Institute. But what the Heartland Institute spends most of its time doing is pulling apart real scientists’ studies and reports; and trying to undermine them….scientist by scientist, report by report, trying to undermine the credibility of the scientist or the report.
Hearing: I guess they say they’re putting their money behind different views, airing views that are perhaps not mainstream?
van Diggelen: That’s the interesting thing. There’s a huge difference between what people think about climate change in America versus in Europe and the rest of the world. I think, for the rest of the world, it’s a done deal, it’s an accepted truth. But here an America, and I think a lot of people would agree with me on this, the Koch brothers’ machine of climate denial has helped muddy the waters so a lot of people aren’t quite sure, especially if you look at Republican candidates, a lot of them talk about “the science isn’t a hard fact.” They’re wary of actually admitting that there is such a thing as global warming going on.
Hearing: Alison, are there any moves to…we heard that there was a case some time back going to the Supreme Court…where there was an attempt to try to clear the position as far as money and politics were concerned. Is there any renewed attempt, ahead of the 2016 election to try to restrict in any way how much money can be put into the campaign?
van Diggelen: Not that I’m aware of. There seems to be the dominance of the 1% here in the US. They’re influencing what is happening in the US in four ways: through policy, courtroom decisions, TV ads, and the education system. They seem to be unfettered in their ability. Perhaps the court case you were referring to is Citizens United? But that effectively gave more power to these political action committees and allowed them to create dark money groups where they’re not actually declaring where the money is coming from. It’s all rather doom and gloom.
Hearing: We talked there about the Koch brothers, and they tend to be backing Republican candidates…but where you are, around Silicon Valley there are a large number of very wealthy individuals who have quite a liberal outlook and could deploy their money there. Similarly people in Hollywood. Does that happen too?
van Diggelen: It is happening. The person of note is Tom Steyer. He’s a San Francisco, former money man, who’s now putting a lot of his millions into an organization called NextGen Climate. They are getting involved in politics and they are targeting mostly Republican candidates, those that are rejecting climate science. I’m all in favor of that: exposing these people with their crazy science ideas…
Hearing: But that’s big money too…
van Diggelen: I agree. That is big money but it’s a drop in the bucket compared to what the Koch brothers are able to leverage from the other side. Tom Steyer has the science behind him and to be honest, it’s shameful that big money from the Koch brothers is being used to fund this anti-science and impact not just America, but the rest of the planet
Hearing: Although the people you’re talking about are trying to put big money in the other side.
van Diggelen: Yes, but I think they’re just trying to make things clear. Science is science. They’re trying to expose the truth of the science and the lies of the anti-science.
Hearing: We’ll leave the argument there. It’s an interesting one…
Read more from Coral Davenport in the New York Times re a January 2015 US Poll on Climate Change
“Although the poll found that climate change was not a top issue in determining a person’s vote, a candidate’s position on climate change influences how a person will vote. For example, 67 percent of respondents, including 48 percent of Republicans and 72 percent of independents, said they were less likely to vote for a candidate who said that human-caused climate change is a hoax.”
Correction: I mistakenly called the Heartland Institute, the Heritage Foundation during the interview. The transcript has been adjusted to correct this error. The Koch brothers are known to be contributors to the Heartland Institute, via their family foundations, as verified by the Center for Media and Democracy.
Alison van Diggelen: The main idea is, if you’ve got solar panels on your roof, or windpower, your house can become a power station with the addition of these batteries. No matter what natural disaster, earthquake etc. is happening, you will have a reliable source of power. You won’t need the utility anymore. You can just disconnect from the grid, go “off-grid.” So that’s the huge potential and that’s why people are really excited about tonight’s announcement.
van Diggelen: There are a lot of reservoirs in the south San Francisco Bay area that are completely dry or close to being dry. A lot of locals are letting their grass go brown. There are a lot of visible ways of seeing this, however you’re also seeing beautiful verdant grass on golf courses, so you could say there is a cover up going on. This is long overdue, there really needed to have been mandates before this, but at least there is something happening now. Gov. Brown is calling for reduction in water use of 25% for the next year.
Huang was keen to explore what 
Last week, I joined Roger Hearing, 
