Between the Poles

Investment in clean energy exceeds investment in fossil fuels in 2010

According to Bloomberg New Energy Finance in 2010 $187 billion was invested in renewable energy from the wind, sun, waves and biomass compared with $157 billion invested in natural gas, oil and coal. Furthermore the IEA says that renewable energy is becoming increasingly cost competitive with fossil fuels.  For example, it has been argued that right now solar PV is approaching costs comparable to natural gas-fired peaking units.  Bloomberg NEF expects "wind to become fully competitive with energy produced from combined-cycle gas turbines by 2016 in most regions offering fair wind conditions."  In Australia New research from the Australian National University shows that with the new carbon tax, solar PV retail grid parity will be reached in Australia this year.

                    Total 2010 investment

Fossil fuels    $157 billion

Renewables    $187 billion

According to the IEA the renewable electricity sector generates almost 20 percent of the world's electric power.  Hydro power is the largest source of renewable electricity, responsible for about 16 percent of total power generation in 2009.  Non-hydro renewable electricity generation grew by nearly 74 percent between 2005 and 2009.  Wind has grown most rapidly in absolute terms. Solar has grown at an annual rate of 50.2 %.  Installed solar capacity reached about 40 GW at the end of 2010.

Subsidies

According to the IEA's WEO-2011 report, fossil fuel subsidies far exceeded renewable energy subsidies last year. 

                    Subsidies

Fossil fuels    $409 billion

Renewables    $66 million

Subsidies for oil products represented almost half of the total fossil fuel subsidies. If current government policies remain the same, the cost of fossil-fuel consumption subsidies will reach $660 billion in 2020.  High oil prices are making the cost of subsidies unsustainable in many countries and  some governments are trying to reduce them.  Of 37 countries with subsidies, at least 15 have started to phase them out since 2010.

Global renewable energy subsidies increased from $39 billion in 2007 to $66 billion in 2010.  According to the IEA, subsidies will need to expand further to meet existing targets for renewable energy production. In one IEA scenario, subsidies to renewables would reach almost $250 billion by 2035.

Germany's economic growth constrained by labour shortage of engineers and skilled workers

Germany's aging population and low birth rates is creating a labour shortage that is limiting Germany's economic growth.  According to the German Chamber of Industry and Commerce DIHK Germany needs 400,000 engineers, master craftsmen and skilled workers.  One of the worst areas of shortage is engineering, where according to the Association of German Engineers there are about 80,000 unfilled positions.  DIHK estimates that German economic growth has been reduced by one percent by the labour shortage and that the problem is getting worse.  Germany's unemployment rate is the lowest in Europe at close to 7 percent.  In 2009 the Federal Statistical Office reported 680 000 job vacancies and that figure may be higher in 2010.  It is estimated that Germany could be faced with a labor shortage of five million people within the next 15 years. 

But since 2008 more people have been emigrating from than immigrating into Germany and the German government is trying to reverse this trend.  On May 1, Germany and Austria opened their labor markets to citizens of the Eastern European countries that joined the EU in 2004. Last month the German government relaxed conditions for skilled workers that were seen as hindering immigration.  The federal employment agency is reportedly targetting engineers in Spain, which has the highest unemployment rate in the EU.

Fukushima Daini Reactors Status: Three Reactors Have Achieved Cold Shutdown

According to WNN, Unit 3 cold shutdown appears to have gone exactly as expected, with no systems damaged. The reactor went from power production to cold shutdown - where coolant water is at less than 100ºC - in about 34 hours.

Damage to the emergency core cooling systems (ECCS) of units 1, 2 and 4 led to TEPCO declaring  emergency status. The reactors used the make up water condensate system to maintain coolant levels above the reactor core.

An additional emergency notice was declared for Unit 1 because the temperature of a suppression chamber reached 100ºC.

The Fukushima Daini plant then continued in a relatively steady state throughout 12 March, with coolant levels and pressures contantly monitored by engineers.  Units 1, 2 and 4 were prepared for potential venting, but this was not required.

In the last 48 hours, TEPCO has carried out repairs to the emergency core coolant systems (ECCS) of Units 1, 2 and 4. Unit 1 announced cold shutdown at 1.24 am today and Unit 2 followed at 3.52 am.

TEPCO has completed repairs to the ECCS of Unit 4 and gradual temperature reduction started at 3.42pm.

In contract to Fukushima Daiichi, Fukushima Daini apparently has had off-site power at least since March 12.

INSPIRE Conference 2010: Geospatial, Cloud Computing, Social Networking, and the Economic Benefits of Sharing Spatial Data

The INSPIRE Conference 2010 is being held this year in Cracow, Poland, an absolutely stunning location.  There have been some riveting presentations as part of the first day's plenary session that for me put the INSPIRE initiative in a broader international context and in the context of some of the immense transformations that are changing the IT world such as cloud computing and social networking.

Professor Jacqueline McGlade, Executive Director of the European Environmental Agency (EEA) gave a 50,000 foot overview of what is going on in the EU with respect to the geospatial sector and the environment.  In a quick historical summary, she said the EU has moved from shipping trainloads of paper to Brussels, to electronic data submission, to open public access to electronic data.  Fully 90% of the data that submitted as part of environmental monitoring and reporting has a geospatial tag.  

Three areas that are getting a special focus in the EU are forestry, biodiversity, and drought.  For example, there is now a biodiveristy web site for Europe called BISE.  Starting in 2012 it will be illegal to import wood products from non-sustainable logging sources.  Max Craglia, of the EC's Joint Research Centre (JRC), in a later presentation mentioned as an example of crowd-sourcing that in Brazil illegal logging operations are coming under public scrutiny by way of a Brazilian Globo Amazonia site, that enables anyone to report illegal logging including digital images.  TV news channels are following the social networking site and sending reporters to the sites to follow-up on the reported illegal logging operations.

Cloud computing

But I think the item that really got my and many other people's attention was Professor McGlade's and other speaker's comments on the impact of cloud computing.  She was unequivocal about two things. 

• Data is more secure in the cloud. 
• And costs are "falling and tumbling." For example, the EEA is seeing a 60% cost reduction in running costs for spatial data. 

Max Craglia highlighted some of the dramatic changes that are happening as a result of the rise of social networking; more internet traffic associated with social networking than email, mobile exceeding desktop internet, and mobile data exceeding voice.  Professor McGlade said that research has found that 42% of EU citizens feel poorly informed about environmental issues and as a result a new site called Eye on Earth has been created to bridge the gap between initiatives like GMES (Global Monitoring for Environment and Security) and INSPIRE and the citizen.  For example, you can find current air quality reported for your location on Eye on Earth.  But her response to a question about plans for European IT infrastructure for environmental data was very interesting.  She said that the EU should be focussing more on quality assurance than on building the IT infrastructure because otherwise there is a risk of being overtaken by the rapid change that is happening in IT, a real risk for big, multi-year government initiatives.  Essentially she is saying to leave the IT infrastructure to the commercial sector.

INSPIRE and the world

Professor Mauro Salvemini, President of EUROGI (European Umbrella Organisation for Geographic Information), put INSPIRE in the context of the rest of the world, mentioning a 2010 UN proposal for a world geospatial forum.  His argument is that INSPIRE creates opportunities for EU countries on the world stage.

Economic Benefits of INSPIRE

I have blogged previously about two studies, in Australia and New Zealand, that attempted to put a dollar figure on the contribution of the geospatial sector to the national GDP.  Max Craglia outlined the results of studies in the EU that attempted to quantify the economic benefits of sharing spatial data.  One was the cost reduction across the EU of environmental impact assessments (EIA) and strategic environmental assessments (SEA) where the savings are estimated to be €100 to 200  million per annum.  He also mentioned some smaller studies.  One was in Catalonia, where the expenditure of €1.5 million over four years saved the local government €2.6 million.  The second was in Lombardia, where the expenditure of €4 million on spatial data infrastructure led to savings of €3 million per annum.

CGC 2010 Geomatics and Productivity in Canada

The first Canadian Geomatics Conference was held in Calgary last week.  The opening session includes a guest presentation by Glen Hodgson, Senior Vice President and Chief Economist at the Conference Board of Canada.  The Conference Board of Canada prepares an annual report card, How Canada Performs, that assesses Canada's performance relative to other countries in different areas including innovation, education and skills, health, society, economy, and the environment. On the 2009 report card, Canada moved from a “B” to an “A” on its education performance, was assigned “B” grades on its economic, health and social performance, but got a “C” on environmental performance and a “D” on innovation.  The dismal performance on innovation and how geomatics could contribute to solving the problem was the theme of Glen Hodgson's talk.

Productivity Crisis in Canada

Wealth generation depends on three factors human capital, investment, and innovation.  Canadians work just about as hard as Americans (98% of US working hours per capita), the capital investment in Canadian industry is comparable to the US, but Canada's productivity (multi-factor productivity or MFP) is just 82% of US productivity and the trend is getting worse. Canada ranks somewhere in the range of 12th to 14th in the OECD with respect to innovation.

The structural challenges that are making this a very serious issue right now are the aging workforce and the strong loonie (Canadian dollar), which has just about reached parity, after falling as low as 63 cents a number of years ago.  According to Glen Hodgson, the North American Free Trade Agreement (NAFTA) was good for the Canadian economy, as has been the reduction in capital taxes.  But the weak loonie over the past few years has been bad for productivity, because it reduced the economic motivation to innovate. He also said that whereas the US economy lost 8 million jobs in the current recession and those jobs haven't been regained, in Canada 400,000 jobs were lost and virtually all have been regained.  That is certainly good news in the short term, but because it negatively impacts productivity it may not be good for the economy in the long term.

Geomatics and Productivity

Glen Hodgson's main point was that the geomatics industry, which has historically been a world leader in innovation, can contribute to improving Canada's productivity.  The last federal budget, which was about $225 billion, talked a lot about innovation so this is a Federal priority.  As I have blogged about in the past,  Australia and more recently New Zealand have attempted to estimate the contribution of the geomatics industry to the gross domestic product.  They also attempted to estimate the significantly larger contribution the geomatics industry could make with the appropriate government policies.  In Canada there is an initiative underway, supported by the Geomatics Industry Association of Canada (GIAC) and other organizations, for a national geomatics program. 

At CGC 2010, Prashant Shukle, Director General, Mapping Information Branch, Natural Resources Canada, organized a four hour discussion with representatives from the Federal and provincial governments, academia and the private sector to discuss the what and how of accelerating this effort, which looks very promising.

Rising PC Shipments Driven by Mobile

 According to an IDC report, PC shipments are expected to grow by 12.6% year-over-year and double-digit growth will continue through 2014.  Portable PCs are expected to account for 70% of the global market by 2012.  Growth in shipments of netbooks and low-end mini-laptops slowed while other laptop categories increased 22% increase year-over-year.  In the second half of 2009 global shipments were up 2.9% year-over-year. In the United States, PC shipments were up 6.7%.  Consumer PC purchases were the sole driver of the market last year increasing 38.5% year-over-year.  Commercial shipments were flat until the end of the year when there was a slight increase.

Gartner, in its preliminary 2010 forecast earlier this month, predicted that that global PC shipments would increase 19.7% year-over-year. Gartner expects mobile PCs to account for 90 percent of PC growth over the next three years.   In 2009, mobile PCs accounted for 55 percent of all PC shipments and Gartner expects that by 2012, mobile PCs will be responsible for nearly 70 percent of shipments.

Gartner expects that the worldwide market for touchscreen mobile devices in 2010 will increase 96.8 percent increase over 2009.  Gartner predicts that by 2013, touchscreen mobile devices will account for 58 percent of mobile device sales worldwide and, incredibly, more than 80 percent in North America and Western Europe.

Largest Infrastructure Projects in Canada

Every year ReNew Canada publishes the largest infrastructure projects in Canada.  To be included a project must either be in construction or at least have financing completed.  Also oil and gas and commercial/residential projects are excluded. 

This year the total investment in the 100 top projects is $68 billion, beside which the government's infrastructure stimulus of $4 billion looks tiny.  Interestingly none of the top 100 projects involve funding from the federal stimulus program, primarily because the stimulus program is oriented toward small projects. Of the top 100 projects most are health care projects.   

I think I also saw that 15 of the top 100 projects are aiming at some level of LEED certification.  For example, the $1.5 billion expansion to the Edmonton airport will be LEED certified.

Six of the top 10 projects are energy projects, and five of those are renewable energy.  For the Californians out there hydroelectic projects are considered clean and renewable in Canada.

• 1 Romaine Complex A - $6 billion 1.5 GW hydroelectic project in Quebec to generate 8 TWh annually
• 2 Eastmain-1-A/Sarcelle/Rupert = $5 bllion 918 MW hydroelectric project in Quebec to generate 8.5 TWh annually
• 5 NaiKun Wind Energy - $2 billion 396 MW offshore wind generation project in Hecate Strait near Haida Gwaii and Prince Rupert, British Columbia
• 6 Wuskatim Generation - $1.6 billion 200 MW hydroelectric project in Manitoba
• 9 Niagara Tunnel - $1.6 billion 10.2 km tunnel with a 12.7 m diameter to supply additonal water to the Ontario Power Generation plant on the Niagara River
• 8 Keephlls 3 Generating Plant - $1.6 billion 450 MW coal-fired generating plant in Alberta with reduced CO₂ emissions

The remaining top 10 projects are transportation projects

• 3 Spadina Subway Extension - $2.6 billion transit project in Toronto
• 4 Port Mann/Highway 1 (PMH1) - $2.5 billion highway project in British Columbia which won an Autodesk BIM Experience design award last year
• 7 Windsor-Essex Parkway Underway - $1.6 billion highway project to connect Highway 401 in Ontario to the US Interstate Highway system
• 10 Turcot Interchange - $1.5 billion highway reconstruction (aging infrastructure replacement) project in Quebec

Forrester Projects Worldwide Software Spending Growing by 9.7% in 2010

According to InformationWeek, Forrester,in a report entitled US And Global IT Market Outlook: Q4 2009, is forecasting that global spending on IT hardware and software will grow 8.1% in 2010, after a decline of 8.9 % in 2009.  Regionally Forrester expects Western Europe to lead the resurgence.

• Western and Central Europe 11.2%
• Canada 9.9%
• Asia Pacific 7.8%
• Latin America 7.7%
• U.S. 6.6%
• EMEA 2.4%.

Forrester expects that software will see the largest increase with worldwide spending on software growing by 9.7%.

Stagnating Productivity in the Electric Power Utility Industry

Productivity has become a critical issue in the utility and telecom industries as a result of the aging and shrinking workforce.  Organizations are losing experienced designers to retirement faster than they can replace them with younger inexperienced workers.  This means that they are not only facing reduced headcount, but also fewer experienced workers.

I blogged previously about the challenge of an aging workforce in Europe.  Europe’s work force will begin shrinking in the coming years and is expected to become 15% smaller within five decades, according to the OECD.

This has long been recognized as a problem in North America as well.  In the US a Conference Board study Managing the Mature Workforce predicted that by 2010, the number of workers aged 35 to 44 will decline by 19%.  A study from the American Public Power Association (APPA) called Work Force Planning for the Public Power Utilities: Ensuring Resources to Meet Projected Needs reports that the loss of critical knowledge and the inability to find replacements with utility-specific skills are the two biggest challenges facing the industry.   In the utility industry as many as 60 percent of experienced utility workers will have retired by 2010. A Booz Allen Hamilton study predicted a 20% decline in productivity in the US power industry.

I collected some statistics from the US Bureau of Labor Statistics to compare productivity in the electric power industry to non farm industrial productivity.  The results, which are shown in the attached graph, show that productivity in the electric power industry increased more rapidly than non farm industrial productivity through 1998, but that since 1998 productivity in the electric power industry has stagnated. This confirms that the electric power utility industry is facing a serious productivity problem, which could not be happening at a worse time.  Green energy and smart grid initiatives mean that utilities have more on their plate than at any other time in recent memory.  Retiring workers are leaving faster than younger replacements can be hired and trained. Workers who are retiring have many years experience and are being replaced with younger, inexperienced workers.  And utilities are having a difficult time retaining younger workers.

Greenland and Antarctica Not Affected by Economic Downturn

I came across a blog post by Joe Francica that injected a bit of humour into the otherwise marginally encouraging economic news.