US Grid Improvement to Incorporate Renewables

The New York Times reports that the Federal Energy Regulatory Commission unanimously approved a rule Thursday that establishes guidelines "for planning and paying for new power lines, part of a long-term policy effort to help the nation's electricity grid grow enough to meet the demands of renewable energy and a competitive electricity market." The rule "is intended to push the organizations that manage the grid into cooperating with one another, so that developers can build power lines across several states and multiple electrical jurisdictions." However, it "does not specify what the formula should be for allocating costs, or precisely how new lines should be planned."

The Wall Street Journal published that FERC Chairman Jon Wellinghoff said Thursday that the new order will benefit wind and solar energy projects in particular, because they are often located in remote areas and lack access to existing interstate transmission lines. The rule will allow companies other than local utilities to take part in transmission projects, with the hope that the removal of such barriers will increase competition and lower costs.

US Power Grid

“Let’s see if anyone complains if we eliminate it,” Joe McClelland, head of electric reliability for Federal Energy Regulatory Commission.

To accomodate the variability of renewable power sources like wind and solar, the FERC is considering frequency variations. Now, who keeps time by the grid?

"A lot of people are going to have things break and they're not going to know why," said Demetrios Matsakis, head of the time service department at the U.S. Naval Observatory, one of two official timekeeping agencies in the federal government.

Details here.

Chinese Goods and US Prices

"The Chinese supply 78% of the footwear imported into the U.S.; 71% of the ties; 55% of the gloves; roughly 50% of the dresses and baby clothing; and 90% of house slippers, according to Commerce Department data."

The article in Wall Street Journal this morning here. The following chart highlights the trend:



The article ends with a quote from Bernard Leifer, chief executive of SG Footwear:

""There's been a shift in who is holding the cards," Mr. Leifer says. "It used to be that the retailers would demand lower prices. Vendors like us would demand lower prices from the factories. And the factories would generally acquiesce. The whole thing has now flipped. The bottom line is the American consumer is going to end up paying more.""

Innovation in cars

I met my friend Mr. Martin Ertl, currently CIO of Bombardier Transportation in 2006 when he was the Head of Innovation Impulses at BMW. He stated to me in one of our conversations that the innovation in cars will now come from the outside. A quote from Martin in "Sectoral Innovation Leaders Showcasing" here is apropos:

"To set itself apart from its competitors, BMW created a decidedly dynamic and sportive image for its products, claiming to build the ‘Ultimate Driving Machine’. “A promise that has to be kept”, says Martin Ertl, Head of Innovation Impulses at the BMW Group Research and Innovation Centre (FIZ): “Without any doubt BMW sells lifestyle. But that’s only part of the story. Selling lifestyle doesn’t work without a product endowed with the appropriate technological substance.”"

Today, Martin's preemption at BMW helping it become the world's no. 1 luxury car brand, is going mainstream. RIM's PlayBook is getting integrated into cars. Cars are becoming an experience where there will be no discontinuity in comfort from home to car to office to car to dinning to car to home ...

See Wall Street Journal's article "RIM hopes cars drive PlayBook sales" here.

India: Brand overload

Quote from WSJ article:

"India's store shelves groan under the weight of consumer brands. About 900 new food and beverage brands alone have been launched there in the past two years. Yet while shoppers enjoy ever more choice, it is getting harder for companies such as Procter & Gamble and Hindustan Unilever to preserve profit margins."

Consumer Products Goods sector is going to be a very competitive market in this decade to create large values for investors. The winners will be ones who are Unique versus Distinctive. See my previous blog on the subject here, or win on price points.

Natural gas as automotive fuel

This is fascinating! From the WSJ, details here.

B2B vs. B2C Innovation Growth

More funding is going to consumer (soft) applications versus (hard) technology products. Who is making the product technologies today? Multi-Nationals like GE are taking the lead, see "GE Makes India a Lab for Global Markets" here from Wharton.

Are the breakthroughs like the printer and the personal computer no longer the domain of Silicon Valley?

From the Wall Street Journal "For Silicon Valley Start-Ups, Funding Boom Is Lopsided" here.

China Update

Via good friend Mr. Tony Tsai, CEO – BHG Retail Innovation Institute and EVP Operations – The BJ Hualian Hypermarket Co.:

"Zeng Peiyan urges establishment of free trade zone between China, Japan and South Korea to be accelerated
April 25, Zeng Peiyan, former vice premier of China, urged the establishment of a free trade zone between China, Japan and South Korea to be accelerated. He said that the three countries should enhance their cooperative partnership to deal with international risks and challenges. He made the remarks during the Northeast Asia Trilateral Forum in Hangzhou."

"China is the world's largest consumer of geothermal power
Guan Fengjun, head of the geological environment department at the Ministry of Land and Resources, said that China will further develop geothermal energy over the next five years as it steps up efforts to cut carbon emissions. China will increase the proportion of geothermal power in its energy mix to 1.7%, which is more than 10 times the current amount, by 2015. China is already the world's largest consumer of geothermal power. Consumption of geothermal energy in 2010 was equal to the consumption of 5m tons of coal."

"Development Research Center of the State Council: China's GDP will grow by 9% in 2011
The Development Research Center of the State Council published a report on Monday. It predicted that China's GDP will grow by 9% year-on-year in 2011. China's trade surplus may be further reduced to $140b, or 2% of China's GDP, in 2011."

Natural Intelligence from Saffron Technology

Recently I wrote a response (see here) to a friend CIO at an analytics company's question on... What is transformative in the analytics space? What can work with entrenched platforms and systems while allowing for breakthroughs to occur?

Sounds like a familiar concern if you are a CIO of any company that deals with large amounts of data, hence, CPG, FMCG, airlines, finance, etc. The large investments in Oracle, SAS, SAP, etc. cannot be supplanted, yet they can be complimented.

I am on the Board of Advisor of what I consider the world's first data analytics company that unifies the transformation being desired, i.e. unification of semantics and statistics, in real time. Please see a set of video-logs that shares how Saffron is being used. With a bit of marketing, the examples will highlight the breakthrough.

See details here... enjoy!

Electric Cars - The Reality

From the Wall Street Journal:

"Electric vehicles have been with us for almost 180 years. The first, an electric carriage created by an inventor named Robert Anderson, made its appearance in Scotland in 1832."

"If you are looking for a car that makes good economic sense in these tough times, PEVs simply don't make the grade. Unless crude oil prices rise close to $300 per barrel and battery costs fall by 75%, a PEV is more expensive than a gasoline-powered vehicle."

See complete article here.

China and US Bonds

Via good friend Mr. Tony Tsai, CEO – BHG Retail Innovation Institute and EVP Operations – The BJ Hualian Hypermarket Co.:

"China has reduced holdings of US bonds for three consecutive months; China reduced holdings of US Treasury bonds by $5.4b in January: March 15, according to statistics issued by the US Department of Finance, China reduced holdings of US Treasury bonds by $5.4b in Jan. China has reduced holdings of US bonds for three consecutive months. China is still the largest holder of US bonds. China's holdings of US bonds were reduced to $891.6b by Dec. 2010."

US Patent Changes!

Having written about patents in general, see here, here and here, the new changes USPO are creating excitement!

From Yahoo News, details here:

"The most substantial change brought about by the bill would be to switch the United States to a "first-inventor-to-file" system for patent applications used by all other industrialized countries rather than the current "first-to-invent" system. Supporters say the first-to-file system would put American innovators on the same page as their overseas competitors, making the process simpler, more certain and less expensive."

From The Hill, details here, the reader comments are enjoyable.

From The Wall Street Journal, details here:

"The Patent Office would also gain power to set its own funding, a move that is likely to mean higher application fees but also greater resources to process an application backlog that exceeds 700,000."

From The New York Time, details here:

"... the House is unlikely to take up a patent bill anytime soon, and people with an interest in the patent system say they expect its bill to be significantly different."

"Many smaller companies and inventors opposed the change, however, arguing that it favored companies that could hire legions of lawyers to quickly file applications for new permutations in manufacturing or product design."

"A consortium of technology and computer companies are already lobbying House members to resist addressing procedures to re-examine patents in their bill. The Information Technology Industry Council, whose members include Dell, Google, I.B.M. and Microsoft, said in a letter to Mr. Leahy earlier this month that it opposed the bill’s provisions to alter how patents could be re-examined, asserting that this would increase litigation rather than reduce it."