Episode 117 - A frank discussion on energy

Following the COP26 summit in Glasgow, Scotland and it seems, particularly in Europe, that the only discussion on the table is about ‘green energy’. Look, I get it. We humans are a messy bunch and we’ve decided to burn sequestered fuel (fossil fuels) rather than take advantage of other energy sources. But are the solutions being discussed really the answer?

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Show Notes

I’m going to start this conversation with some facts that are all influenced by energy:

1.    In the 1800s, the British Empire soared to regain its world leadership because it discovered the power of the steam engine.

2.    In the 1900s, the US Empire became the world’s #1 super power because it discovered a better way than the Brits – to use the combustion engine and petroleum to fuel its rise to prominence.

3.    In the mid 1900s, the power of nuclear fuel was established by stealing the engineering talent of the Germans post WW2 by both the US & Soviets who carved up the winnnigs of WW2, with the US first demonstrating the power of nuclear when weaponized in Japan.  But in the decades that followed WW2, both the US and Soviet Russia harnessed nuclear as a continual and abundant fuel source.

4.    The discovery of using silicon technology and the invention of the solar panel in the late 1900s, provided a way to generate small power yield using the power of the sun – but on the proviso that the sun was shining.  When night fell, there is no sun shining.  

5.    Further down this path, the power of wind & hydro power were harnessed to generate smaller power yield, but with the advantage that both sources typically operate 24 hrs a day, albiet that wind is less reliable.

6.    To capture power for future use, we invented and harnessed batteries (and continue to expand on this both in capacity & cost) as a way to sequester energy ourselves, for future usage.  But our use of batteries at this point operates much more like a capacitor, in that storage in batteries is not something that can last months or years.  It needs constant recycling, and that depletes the lifespan of the batteries.

Now these historical facts seem to be easily forgotten.

But what is noteworthy that is also not discussed is this big one – and this is personal because it was the underlying factor of my own career path and the ability to see/predict the future.

1.    Technology invention happens because man-kind want to evolve into more efficient and effective creatures

2.    The biggest reason why we have evolved so fast in the past 100 years or so IS because of energy

3.    The very same folk that are calling for a green energy revolution, are doing so against their own best interests, because often the scientists and technologists that would not have a career if it wasn’t for energy, are attempting to stall or halt the growth of their own industry with their green energy directives.

Let me ask you this one simple question….

Can you fly to Mars on solar power?  Or wind power?  Or batteries?

Can you launch a spaceship out of the earth’s atmosphere without fossil fuels?

Do you power your submarines or fleet of naval ships on solar or wind power?

And what do you think is going to create the 21st century world super power, just like the past 2 centuries?  Do you think that maybe the country that has more dominance in space might be the dominant player on the world stage?

I will sum this up in simple terms….

THE FUTURE IS BEING FORGOTTEN WHILE WE CONDEMN OURSELVES FOR THE PAST

The reality is that if we live in a world of batteries, solar panels, green energy, etc. we are making a conscious decision to give away our control of the future.

Let me bring this back to current times and technology.

Right now, I have a number of servers in my home.  They do cool things – they store all of my video & audio collections so I can listen and propogate them to various devices in the house, car, etc. for consumption.  They have arrays of hard disk drives.  I frequently replace hard drives as they fail, and often the price of the hard drives are about ½ of the price each year, or for the same money I get double the storage.

I have a recording studio in my home.  Much of the studio I have is small in size compared to the larger, commercial recording studios that I’ve built in the past, but they do much the same thing.  I have mixing consoles, racks of gear, etc. left over from past endeavors, which is often 20+ years old.  Some items, like vintage guitar amps, etc. are over 55 years old.  We seem to crave the warmth and tones of the past here, but they have old vintage tubes in them.  When I plug them into the wall and turn them on, I know my power bill just went sky high.  The same is true of the mixing consoles and rack gear that I use.

Now sure, I could do much of this on a laptop these days.  But I really can’t do the level of work that I do without this gear.  Maybe part of that is just me not moving on, but I have learned over decades how to master the craft of sound engineering, and this old gear is needed.  Ask any professional audio engineer about old Neve or SSL recording consoles from the past, and they will concur with my position here.  I’m confident about that.

I live in Arizona, specifically Scottsdale.  This is a “terra-formed” city – we took a hostile part of the planet – the harsh desert – and we turned it into habitable land and built what is now the 5th largest city in the USA here.  That required re-routing water from the melting snow of the Rocky mountains and diverting it through the Grand Canyon to our city.  Additionally other forms of water supply were harnessed because you can’t put all your eggs in one basket.  As a result, I live in Phoenix with over 5 million others that can get through 4-5 months of 100F+ temperature days – often mixed in with many 110F & 120F temperature days thrown in for good measure.

The secret to this is air conditioning.  Everywhere here has A/C units.  Those units are expensive to operate, and we constant upgrade them at massive costs to ensure that we can live and survive in this hostile climate.  This results in monthly power bills that are 2-3x as much in summer than they are in the more mild winter period.

I have spent a lot of time & money to manage power.  I installed a TED device to monitor by circuit how much power I am drawing.  When you get $500+ monthly power bills in summer, you want to find ways to save money.  I’m Mr. Frugal here, after all.  Maybe the answer is to move to a more temperate climate?  Sure, but the cost of that will be huge, require a lot of disruption and re-establishment of life.  I’m doing that with San Miguel de Allende, but that is a long term play.  In the meantime, I’m still paying the local power company here to survive in this harsh climate.

When I install a new server in my home, or in our data center, it is because it can do something new, exciting and revolutionary.  And 99 times out of 100, that means I need to use more power.  That sleek new & fast graphics card from AMD or Nvidia increases my power consumption.  Adding more storage increases power.  Faster CPUs increase power consumption, creates more heat and that heat needs to be moved out, so more air conditioning.

Basically what I’m trying to say here is that if you want to do newer, cooler things and you want to fight against natural entropy, terra form harsh regions as humans migrate to them, you need lots and lots of power.

How does Phoenix do it?  Well half of the city is powered by APS and half is powered by SRP.   APS gets the bulk of its power from nuclear power plants – the Palo Verde Nuclear reactors, and SRP gets the bulk of its power from hydro-energy (that water being brought down from the Rocky Mountains).  There’s a few other coal powered plants in there for good measure, but the bulk is coming from these sources.

I’m on APS, so my home and business interests are powered by nuclear energy.  So are all the power sources that my tenants use for their rental properties.

I pay different rates for power throughout the year, but in the peak of summer hours it is about $0.23 per KwH, and that goes down to about $0.07 per KwH in winter time.  The cost of power generation for nuclear energy is basically front-loaded.  The build of the reactors is the largest expense, but the ongoing costs here are due to cooling costs, security and then storing the waste.

And I live in a state that has more sunshine than pretty much any other.

When I had to make a conscious decision about where to put my servers for my business, I chose to put half of them in Texas and half of them in Arizona.  Why?  Cost of power.  Since I wanted to offer resources to clients that would allow them to grow to the next level, I needed a place that could support that growth.  Clients won’t accept statements like, “I’m sorry but you can’t install that new database technology because we don’t have enough power for it.”.  They will go elsewhere if you have that.  You need to be able to grow with them, and they are hungry for growth.  It seems that the pressure that is on them to compete is huge.

And do you think they will give up on competing because they can’t do it with renewable energy?  Nope.  Give that idea up.  All the BS you hear about Amazon being 100% green, or Apple being 100% green, is pure marketing spin.  The truth is that they couldn’t invent those new semiconductors that power the latest, fastest, tech without a lot of energy.  And Amazon can’t run data centers that power 60% of the Internet with AWS, on purely green energy.  Yes, they might make some BS marketing statement about that, but dig into the truth here – high end, powerful servers, draw at least 3Amp supply each and they have hundreds of thousands of them.  Along with the cost of A/C cooling, power is their #1 operating expense.  And you don’t turn the Internet off when the sun goes down.

Now the other convenient thing to consider here is crypto currency.  When Satoshi Nakamoto wrote the Bitcoin white paper, he/she/they banked all the future on the concept of “Moore’s law”.  That is technology typically doubles in power every 18 months.  How does that happen?  Because smart people find ways to cram more transistors into smaller places.  And they find ways to pull more power out of chips, etc. to do more work.  Hence the computational models of solving cryptographic problems that is the fundamental underpinnings of the Proof of Work algorithms that supports the #1 crypto currency in the world, requires a hell of a lot of power.

We went from something you could mine on a spare laptop computer, to ASIC miners that need to be located in Iceland to take advantage of the massive amount of energy from geo-thermal activity there.  If you can’t power a Bitcoin mine, you shut it down. The cost of the power is the #1 cost of operating that mine, and you hope the price rises to make the reducing block rewards profitable.  That’s how that world works.  And our society has embraced Bitcoin as the #1 crypto currency to save our economic future?  Tell that to Greta when she needs to pay for her Starbucks next.

Those that are banking the future on the Blockchain, realize that much of this comes down to what blockchain and how is it tokenized?  No one is going to scale massive data centers to support that without power.  Ethereum used to be minable with Graphics cards, but the costs of power to run those miners was huge.  They had to scale the power of their blockchains to work on ASIC miners so now Ethereum is a heavy power drain.

Elon Musk promotes the future with Bitcoin and the price goes to the moon.  Then he stops and thinks about it and realizes that it is a conflict of interest for him to do that knowing the massive power demands of that blockchain, and let’s face it – he’s in the business of electric cars, solar panels for roofs, etc. so he backs off and pulls back on his Bitcoin support.  Meanwhile the hypocrisy flows as his latest SpaceX craft fly off to space burning….    Fossil fuels to get there.

The most loud proponents of renewable energy resources are often the most hypocritical when it comes to implementation.

If we want to enter a world of de-volution of the human species, then we can do that quickly and easily by reducing power consumption.  It is that simple.  And with that de-volution, you have an ever growing human species count – we are currently at over 8 billion of us on this planet, and that’s doubled since the day I was born.  So what is Greta’s answer to that when she reaches my ripe old age?

You gotta feed that species.  Food production requires power to harvest it.  And store it.  And move it to distribution points.  Along supply chains, etc.

It all requires power.  And our need for power is increasing – not decreasing.

So when I hear Greta Thunberg and her supporters getting all worked up about the future of the planet, I realize that we are listening to someone who has never had to run a business, address the needs of clients, look to the importance of technology moving forward for her own future, but was raised in a microcosm that doesn’t represent the population distribution that is in India, China, Nigeria, the USA, etc.   Places that couldn’t exist and would kill their humans if there wasn’t energy.  

But she has been embraced as the bastion of the future by her supporters.  They want a planet that supports them and a future free of climate events.

I’m not going to get into a debate about what causes massive floods, bushfires, hurricanes, etc.  I’m not a climate scientist.  If CO2 is the reason, then we need to stop it.  I get it.  It is the same argument that we had back in the 1980s and 1990s about fluorocarbons in spray cans destroying the Ozone layer.  What happened?  We changed that and we solved that problem.  I remember the days when urban cities had horrible yellow skies from pollution.  Today that still happens in most Chinese cities, but it has not gotten worse in areas that have had steady population growth.  That doesn’t mean CO2 hasn’t changed though, since that is invisible.

OK, I can embrace the idea of reducing CO2 emissions.  

But here’s the thing no one wants to talk about.  We have too many humans on this planet.  Each one of those carbon based lifeforms creates and exhumes CO2 at levels that clearly we can’t support.  So what do you want to do, Greta?  Mass genocide of 50% of the human population?  Is that the answer?

You think that number isn’t going to increase?  You have the average mother in Nigeria living on corrugated iron in a shanty town on a swamp, having on average eight (yes 8) children.  Nigeria is pegged to become the 3rd highest populated country in the world, behind China & India.  How do you reduce that?

Or the population of Brazil, or Central America, etc.?

The desperation of those in highly populated regions like Brazil have them going into the Amazon and cutting it down to make money to survive.  Yes, to survive.  It comes down to that.  You die in an over-populated planet, or you destroy the planet’s resources to survive.  So while Greta and her cronies are worried about the future of the privileged western economic demographic, you’ve got poor farmers trying to not die out there.  How are you going to solve that?  

I actually think I have the answer.

We use technology and our ability to expand technology to solve this, much like how the technology of the 1800s created the British Empire, or the 1900s created the American empire.

But we have to accept that technology advancement at the “Moore’s law” level requires a shitload of power.  No, you are not going to invent and produce the next Apple M3 or whatever chip without a massive power hungry plant that produces the chips.  Ain’t gonna happen.

Any motivated empire is going to be the next big thing if they can create a massive amount of power to do it.  And the only power source that is likely to be able to address all of this is nuclear.

Yep, nuclear.  We need to get back to nuclear.

Nuclear power will power your submarines, allowing them to exist in hostile worlds (under the ocean) for months and months.  Nuclear power will get your space ships to Mars & beyond.  Nuclear energy will power the next human medical solutions as it has done in imaging in the past.  And nuclear power will allow you to terra-form hostile places and keep costs manageable just as it has done here in Arizona.

It is able to be deployed in small ways, and has a limitless amount of power generation.  It doesn’t produce carbon emissions and it doesn’t care if the sun is shining or not, doesn’t require the investment in pollution heavy batteries.

It will allow you to power those massive data centers and mine your crypto, as we invent the next level of ASIC miners.  It will power the unfortunate march towards the Singularity and it will power space travel to regions we could never get to normally.

Look, I know it is not perfect.  The catastrophy that comes with reactor meltdowns, have become massive for humanity – Chernobyl, The Japanese reactor tragedy, 3 Mile Island, etc.  I get it – it scares the shit out of people.

And then you have to store all that used nuclear waste.  Plus the risk of moving it from the reactor to the storage facilities.

It is scary stuff.  But consider the number of humans on this planet who died from nuclear disasters, vs. the number that will die from not having a power solution?

But, and I think this is something that is never discussed, what about the humans that will have their spirit killed because they can’t battle entropy like their parents did?  I’m talking about the hope of a new tomorrow – a future that is better than the past.  Where you can halt entropy in its tracks by creating new things, better things, etc.  This all requires massive amounts of power.

I don’t think Greta has a real answer to this.  Her followers live in fear.  Fear of a dying planet, fear of no future due to climate change, etc.  And governments are seizing on this fear to further shackle their citizenry as they do with any calamity.  Remember the famous statement from the ex-Obama Chief of Staff, Rahm Emmanuel, “Never let a good crisis go to waste”.  This has become the marching cry of government as they attempt to wrestle the individual freedoms that we need from us, for the good of the state.

They have done this with any crisis that comes upon us – pandemic, fear of war, etc. and now fear of climate disaster.  When all you know is how to wield a hammer, it seems all problems look like nails.

I watched an interview this morning from Australia by a professor of one of the Universities there.  He was in shot outside, with a lovely natural green trees & vines behind him, as they discussed whether Australia should be embracing nuclear energy.

There’s a long history of pushback to nuclear power there, mainly from the Green party, who managed to get some control of government by having the swing vote to many issues.  The crazy way Federal government works there needs to be burned to the ground in my own opinion, but for the past 50 years Australia has rejected all forms of nuclear energy.  Sure, there have been some small plants operating in NSW – often doing everything possible to try and divert attention from them, but when it came to things like defense, the idea of using nuclear power was rejected without question.

I know this personally, as I worked for the Australian Submarine Corporation, in the 1980s, having wrote their contract management and billing systems for them, and then eventually being offered a job to be a systems analyst in logistics, after getting my secret clearance.  I worked directly with the submariners who man those boats.  Our boats (back then) were diesel electric.  

For a systems guy like me, it seemed stupid.  Not only were these expensive and poorly suited to the task of defending a massive ocean that completely encompassed Australia, but these boats couldn’t stay submerged for any major length of time and therefore were more detectable.  Not to mention the noise levels of those engines and the batteries required to be stored on the boats.  Every piece of technology that I was a part of designing had to be traded-off based on size AND power consumption, since we had very little power.  Consider that workstations back in those days had CRT monitors on them, and would be pulling so much power.  

Funny thing is that years later, I found myself in Seattle, Washington, working as a consultant to a big insurance company there, and met up with one of the guys who serviced the Sun workstations we used who was an ex-Naval guy from the local submarine base.  We got to talking (nothing classified of course) about our experiences with the boats.  When he explained to me how a nuclear powered submarine worked, the size of it, that they had a 1 mile running track between the outer and inner skeleton of the boat that the submariners could run on for fitness while spending months under water, it was amazing to me.  What allowed this?

One thing – nuclear power.

And if you don’t think our adversaries are not embracing nuclear power, not just for their weapons, but also for their domestic use and to power their warships and submarines, you are living in denial.  I think much like Greta is.

No one wants nuclear war, and certainly they don’t want weaponized nuclear bombs.  But from a domestic, peace-time resource, it answers what we need.  A lot of economists will tell you that the cost to build a nuclear reactor today is too high and more expensive than the renewable alternatives.  But they don’t tell you that our power needs in 5 or 10 years time, will be massively higher than where we are today.  And that when you look back in history at places that did invest in nuclear power generation (like Arizona), we can now live in hostile environments, run data centers, and invent the next level technology for the future.  Try doing that if you turn off the power.

They say that it is easy to have 20/20 clarity to look back at the past.  If Australia had built nuclear power plants 20-30 years ago, it would not be emitting CO2 and it would have an abundant amount of power.  And that is coming from a country that has 1/3rd of the world’s uranium supply in my home state of South Australia.  If they could sell that natural resource, you wouldn’t need China anymore.  They could be 100% energy self-sufficient, and not be selling coal or LNG to the world instead.

The problems we have seen in countries in the middle east, that are sitting on a gold mine of oil supply and how it affects our day to day lives, not to mention empowering factions that may wish harm to the west, must be considered.  If we didn’t have to intervene in their affairs because of our reliance on their fuels, I’m sure we wouldn’t be hated as much.  That said, the threat of nuclear weapons seems to bring all parties to the table to discuss things in a more rational way.  Our history of cold wars with Russia, etc. shows that it is better to find a way to have peace than risk mutually assured destruction.  I mean both sides lose everything there.  Maybe that is the governor that is needed.

I know that many who will hear me talk about this won’t agree with my position.  I will state it for the record – I believe that the answer to having a future is nuclear energy, and that if we invest in mitigating risks we will get a far better return on investment than pretending that renewables will give us the technological future that we all desire and probably assume.

With a growing world population, we need new ages of technological advancement and that isn’t some “green energy revolution” despite how governments might want to spin this to try and spur the economy along.  They won’t maintain or create the next super power on green energy.  It will come from space travel, physics, etc. and this all requires enormous amounts of power that no green energy revolution can provide.  If anything, the green energy revolution may stall our ability to advance us while we try and spend the next 10+ years trying to scold ourselves over fossil fuels as we post on Twitter, Meta or TikTok about the wonders of green energy – on the very devices built by way of the power of said fossil fuels.

The world, it seems, is one big hypocritical mess.  Let’s get real here.  Our future isn’t about just climate change.  It is about jumping over this to the next big thing and that’s not going to be solar panels, I’m afraid.