The Unintended Empire | John Mauldin | FINANCIAL SENSE

The Unintended Empire | John Mauldin | FINANCIAL SENSE

Hard and soft benefits in the context of Public Utility Commission Rate Case decisions

With a broad brush, one can describe Smart Grid technologies as being adopted through the regulatory process or through market forces (price and demand).  Both processes depend on the benefit to cost ratio of the technology.  Unless the ratio is much better than “One” market forces will ensure slow adoption of Smart Grid.  Because of this, and the use of the regulatory process that ensures economics of scale and system integrity for grid infrastructure, the regulatory process is the focus of Smart Grid advocates.  However, the benefit to cost ratio shows up in regulatory processes as the “used and useful” condition[1], which requires new infrastructure development to have a good track record (“used”) and a short period for cost recovery (“useful”).  The benefits that impress regulators are measurable (called “hard”) in dollars.  These can be benefits for the utility or consumers.  During rate cases, much of the negotiation is about who will receive benefits, typically the monetary (hard) benefits.

Soft benefits are either unmeasurable, or usually enter the utility decision process another way.  For instance, environmental benefits can be estimated by counting avoided medical costs per unit of energy produced.  Although this estimate is made in dollars, it is subject to uncertainty and value judgments and is therefore viewed as soft.  However, if this environmental benefit is mandated by law, then it immediately is transferred to the hard benefit side.  In this case, any technology or program that reduces pollution has a dollar value.

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[1] “Used and Useful” definition, http://www.regulationbodyofknowledge.org/glossary/define/Used%20and%20Useful/

practice exam for engineering physics

Here is link:

Increasing control over and segmentation of communities

See excellent article on school "reform" at
http://www.truth-out.org/failure-corporate-school-reform-toward-new-common-school-movement/1322671494

The student drop out problem

This is a great post from CNN

http://money.cnn.com/video/news/2011/12/02/n_engineers_quit.cnnmoney/?iid=HP_River

on what it takes to be an engineer,

but also what it means to be an engineer, or more generally, in the STEM, that is, Science, Technology, Engineering, MATH

Jumpstart domestic manufacturing through Smart Grid

Jumpstarting domestic manufacturing through Smart Grid is like running up steps. First, the Smart Grid needs to succeed, the faster the better. This will create a hardware and software market for electrical grid modernization here in the U.S. and worldwide. Then domestic manufacturers need to design, build the manufacturing capacity, hire and train employees, and then start producing Smart Grid widgets.

But there are risks. The market may not materialize as predicted, or a foreign manufacturer will get product to market first. Maybe there will be a short term market, and demand will dry up once it is satisfied. Then all the equipment used to make the grid equipment will go unused as it depreciates in value.

Who will invest capital in such a situation? It's not the same as it was with Henry Ford who had years to design and build up manufacturing capacity.

That's the argument for government intervention, or more nicely put, government support and stimulus.

Some technical details need to be attended to for smart grid and for the manufacturing steps.

Smart Grid

Hardware needs to be "plug and play" that is, just like Microsoft puts out standards to make any piece of hardware properly designed simply work when plugged in, hardware from any vendor needs to be able to be installed and work immediately. This requires interoperability standards.

There is a risk here. China is using its own standards because it is banking on its market being big enough to make hardware custom made for its market profitable to domestic (Chinese!) manufacturers. This can be done by any big market player.

Stimulus is a bad word today. It seems that the 2009 stimulus didn't work, or at least its positive results can't be measured, because one can't measure job years created + job years saved.