Other Source of Energy

The companys breakthrough is strictly off-limits to outsiders. Work on the technology goes on in an unseen part of the sprawling one-story building, beyond the machine shop, the various testing and fabrication instruments, the large open office space stuffed with cubicles. What a visitor gets to see instead is a thin wafer of silicon that would be familiar to anyone in the solar-power industry. And thats exactly the point. The companys advance is all about reducing the expense of manufacturing conventional solar cells.

In its conference room is a large chart showing the declining cost of electricity produced by solar panels over the last three decades. The slightly bumpy downward-­sloping line is approaching a wide horizontal swath labeled "grid parity"—the stage at which electricity made using solar power will be as cheap as power generated from fossil fuels. It is the promised land for renewable power, and the company, 1366 Technologies, believes its improvements in manufacturing techniques can help make it possible for solar power to finally get there.

Its an ambitious target: even though silicon-based photovoltaic cells, which convert sunlight directly to electricity, have been coming down in price for years, they are still too expensive to compete with fossil fuels. As a result, solar power accounts for far less than 1 percent of U.S. electricity production. And 1366 founder Emanuel Sachs, who is the companys chief technology officer and an MIT professor of mechanical engineering, says that even though solar might be "within striking distance" of natural gas, existing solar technology wont be able to compete with coal. "To displace coal will take another level of cost reduction," says Sachs. Thats where 1366s breakthrough comes in. The company is developing a way to make thin sheets of silicon without slicing them from solid chunks of the element, a costly chore. "The only way for photovoltaics to compete with coal is with technologies like ours," he says.

Once photovoltaics can compete with coal on price, "the world very much changes," says Frank van Mierlo, the companys CEO. "Solar will become a real part of our energy supply. We can then generate a significant part of our energy from the sun."

In a number of ways, 1366 (the name refers to the average number of watts of solar energy that hit each square meter of Earth over a year) reflects the ambition of a whole generation of energy startups. These companies often refer to "game-changing" technologies that will redefine the economics of non-fossil-fuel energy sources. Many were founded over the last decade, during a boom in venture capital funding for "clean tech"—not only in solar but also in wind, biofuels, and batteries. Many have benefited from increases in federal support for energy research since President Obama took office. Though the companies are working on different technologies, they share a business strategy: to make clean energy sources cheap enough, without any government subsidies, to compete with fossil fuels. At that point, capitalism will kick into high gear, and investors will rush to build a new energy infrastructure and displace fossil fuels—or so the argument goes.

The problem, however, is that we are probably not just a few breakthroughs away from deploying cheaper, cleaner energy sources on a massive scale. Though few question the value of developing new energy technologies, scaling them up will be so difficult and expensive that many policy experts say such advances alone, without the help of continuing government subsidies and other incentives, will make little impact on our energy mix. Regardless of technological advances, these experts are skeptical that renewables are close to achieving grid parity, or that batteries are close to allowing an electric vehicle to compete with gas-powered cars on price and range.

In the case of renewables, it depends on how you define grid parity and whether you account for the costs of the storage and backup power systems that become necessary with intermittent power sources like solar and wind. If you define grid parity as "delivering electricity whenever you want, in whatever volumes you want," says David Victor, the director of the Laboratory on International Law and Regulation at the University of California, San Diego, then todays new renewables arent even close. And if new energy technologies are going to scale up enough to make a dent in carbon dioxide emissions, he adds, "thats the definition that matters."

Field of Mirrors

Few people have more faith in the power of technology to change the world than Bill Gross. And few entrepreneurs are as familiar with the difficulty of turning clever ideas into commercial technology. In the dot-com era, he and his company Idealab, an incubator that creates and runs new businesses, started up several of the eras hottest firms, only to struggle when the bubble burst.

Gross latched onto the clean-tech craze, founding a company called eSolar in 2007 to work on solar thermal technology (see Q&A, March/April 2010). These days, Web, social-computing, and energy projects are intermingled in Idealabs tightly packed offices in downtown Pasadena, California. In keeping with its dot-com-era heritage, the offices occupy a large loftlike space full of various companies or hope-to-be companies, some of them consisting of no more than a few desks dominated by large computer screens. Somewhere in all the brushed metal, exposed ventilation systems, track lighting, and designer desk chairs is Bill Grosss office, a small glassed-in cubicle.

Like almost every other founder of a renewable-energy startup, Gross gets right to the numbers. Pulling up a screen that compares the costs of energy from various sources, he points out how a technology being developed by eSolar could make solar thermal power less expensive and help it become competitive with fossil fuels. Solar thermal plants produce electricity by using a huge field of mirrors to focus sunlight on a tall central tower, where water is heated to produce steam that generates electricity. Large power plants using the technology can produce electricity more cheaply than ones using silicon solar panels, although the thermal approach is still more expensive than power derived from coal or even wind. Several such plants are operating around the world, and more are being built (see "Chasing the Sun," July/August 2009). In 2006, when the giant California utility PG&E put out a bid for a 300-megawatt solar thermal plant (now being built by a company called BrightSource), Gross got excited and began working with his employees to improve the economics.

Not surprisingly, Grosss solution is based on software. Large solar thermal plants cost more than a billion dollars to build, and one reason for the high cost is that tens of thousands of specially fabricated mirrors have to be precisely arranged so that they focus the sunlight correctly. But what if you used plain mirrors on a simple metal rack and then used software to calibrate them, adjusting each one to optimize its position relative to the sun and the central tower? It would take huge amounts of computing power to manipulate all the mirrors in a utility-scale power plant, but computing power is cheap—far cheaper than paying engineers and technicians to laboriously position the mirrors by hand. The potential savings are impressive, according to Gross; he says that eSolar can install a field of mirrors for half what it costs in other solar thermal facilities. As a result, he expects to produce electricity for approximately 11 cents per kilowatt-hour, enticingly close to the price of power from a fossil-fuel plant.

A FULL-SIZE factory-built Holden Commodore that consumes no petrol, delivers at least 160km of all-electric motoring, comes with a switchable battery leased from Better Place and costs no more than the model on which it is based will be available to all Australian within a few years.

That is the ambitious plan that took one step closer to reality today with the announcement that Australia’s largest fleet car buyer has joined forces with a consortium that will produce a Commodore EV initially for fleet consumption prior to its full-scale public release.

Melbourne-based start-up company EV Engineering (EVE), a consortium of five leading Australian automotive suppliers with global connections, revealed its $26 million project to produce an Australian-built rear-drive large electric car based on Australia’s top-selling model in February.

It now says it is on target to produce the first two concept vehicles by the end of this year, and to have a fleet of seven all-electric ‘proof-of-concept’ Commodores ready for real-world testing by mid-2012.

None of the vehicles will be ready to unveil at this week’s Melbourne motor show, but EVE today announced a significant boost to the project by announcing it has been joined by GE – the parent company of Australia’s largest company vehicle provider, Custom Fleet.

GE will join automotive component suppliers Futuris and its partner Air International, Bosch and Continental, and EV charging network company Better Place Australia, in the EVE consortium, which is funded partly by a $3.5 million grant from the federal government’s now defunct Green Car Innovation Fund (GCIF).

EVE and GE would not reveal financial details of the deal, but each existing consortium partner will supply both financial and technical support to the project, with GM Holden and the CSIRO to provide technical expertise.

Holden’s only involvement at this stage is the initial supply of vehicles, data for those vehicles and the use of its proving ground at Lang Lang, but EVE today indicated it was likely Holden would manufacture the Commodore EV.

“Clearly we will be working with them on the project and updating them on our progress and yes we’ll be happy to review plans for mass production as we get further down the track with the car," said EVE CEO and former senior Holden executive Ian McCleave.

The Obama administration on Thursday offered Santa Monica solar startup SolarReserve a $737 million loan guarantee to build a 110-megawatt solar thermal power plant in Nevada that can generate electricity 24 hours a day.

That’s the holy grail for intermittent sources of carbon-free energy such as solar and wind and the SolarReserve loan guarantee is a sign that the United States Department of Energy is willing to gamble on a technology untested on a commercial scale.
SolarReserve literally was founded by rocket scientists from United Technologies’ Rocketdyne division in 2007 and licenses its molten salt technology.

Like rival BrightSource Energy, SolarReserve will deploy massive arrays of mirrors called heliostats around a very tall tower – in this case, one that tops 640 feet – with a boiler attached. BrightSource’s heliostats focus the sun on a water-filled boiler to create steam that drives an electricity-generating turbine.

SolarReserve fills its boiler with millions of gallons of molten salt. Some 17,500 heliostats heat the salt to 1,050 degrees Fahrenheit. The liquefied salt then generates steam to drive the turbine before returning to the receiver. The salt retains heat that can be released at night or when the sun is not shining to continously to produce power.

“This solar technology is a genuine alternative to baseload coal, nuclear or natural gas burning electricity generation facilities," Kevin Smith, SolarReserve’s chief executive, said in a statement.
The Nevada project, called the Crescent Dunes Solar Energy Project, will be built on federal land in Tonopah, Nev., about 220 miles northwest of Las Vegas. SolarReserve said the molten salt can extend Crescent Dunes’ daily operation by 10 to 12 hours and the project can power 75,000 homes at peak output. Whether the utility that has contracted to buy the Crescent Dunes’ electricity, NV Energy, will want the plant to actually run around the clock depends on how it balances demands placed on the grid.

SolarReserve, which also has a license to build a 150-megawatt solar farm in the Southern California desert, is counting on the ability to provide carbon-free power when the sun isn’t shining as a competitive advantage. Rivals are also offering solar storage – Abengoa’s federally funded Solana solar trough power plant in Arizona, for instance, will feature up to seven hours’ storage.

The Milky Way is gradually pulling apart a smaller orbiting neighbor known as the Sagittarius dwarf spheroidal galaxy. Just as gravity from the moon causes Earths oceans to bulge, so too does the gravity of the Milky Way create enormous tides that deform Sagittarius. These are so strong that they rip stars out of the galaxy, producing two long streams of stars, one stretching ahead of Sagittarius and one lagging behind. By observing the stars streaming out in both directions, the researchers conclude that the dark matter and ordinary matter within the smaller galaxy feel the same pull from the Milky Way.

3D Systems, one of the big, incumbent 3D printer makers, is suing Formlabs, an innovative new 3D printer company that prints in resin (see previous mentions), for patent infringement. Theyve also named Kickstarter to the suit.

Many of the key patents in 3D printing start expiring in 2013, and will continue to lapse through 14 and 15. Expect a big bang of 3D printer innovation, and massive price-drops, in the years to come.

• sustainable site development
• water efficiency
• energy efficiency
• materials selection
• indoor environmental quality

• Certified: 40 – 49 points
• Silver: 50 – 59 points
• Gold: 60-79 points
• Platinum: 80 points and above

Despite, relative to his peers, taking an apparently leisurely route towards a green-lighting of Origin Energy and ConocoPhillips’ proposed massive Queensland export LNG facility, Grant King has always appeared confident he put together the customer base to support a go ahead for the project. Today the Australian Pacific LNG partnership was expanded as it locked in its first big customer.

That was not much of a surprise, given that APLNG had signed a non-binding heads of agreement with China’s Sinopec back in February but converting that agreement into a firm commitment was a necessary pre-requisite before Origin and ConocoPhillips could even consider a final investment decision.

Sinopec has committed to taking 4.3 million tonnes a year of LNG from the Curtis Island plant for the next 20 years – the largest single gas contract, by volume, yet entered into by the industry. It will also acquire a 15 per cent stake in the project for $US1.5 billion, diluting the existing partners to matching 42.5 per cent holdings but also reducing the amount of funding they will need to put in place to develop the project.

The contract will underwrite one train in what APLNG plans to be, initially, at least a two-train project that would be developed at a cost of around $US20 billion. Eventually it would like to have a four-train facility at Curtis Island, with an overall investment closer to $US25 billion.

Securing Sinopec ought to help convince other customers to sign up. APLNG has been negotiating with other prospective customers about off-take agreements and with a committed foundation customer and therefore a near-certainty that the project will proceed one would normally expect the prospects of signing up additional customers to strengthen.

Assuming a final investment decision to proceed is made this year, Origin hopes to deliver first gas to Sinopec in 2015.

King has been quite sanguine about demand for APLNG output even thought his project has been lagging the progress of the rival BG Group and Santos/Petronas projects in lining up customers.

The long term outlook for demand for LNG in the wider region is regarded as very strong but, until recently, there were some concerns that the sheer number and scale of new LNG projects planned for Queensland and north-west Australia might overwhelm demand in the near term.

The natural disasters in Japan, and the impact that has had on planned expansions of nuclear plants, however, has fundamentally altered the dynamics of energy supply and demand throughout Asia and, indeed, elsewhere. LNG is the most obvious beneficiary.

A major liquified natural gas (LNG) deal between Australia and China has environmentalists fearing for the future of the Great Artesian Basin. Australia will supply China with a further 4.3 million tonnes of LNG each year for 20 years. ...

The coal seam gas-to-LNG project involves the extraction of CSG from coal seams in the Surat and Bowen basins in southern and central Queensland.

Friends of the Earth spokesman Drew Hutton says this is bad news for the environment, the Great Artesian Basin and for landowners. "The federal government water group and Geoscience Australia believe there are going to be dramatic draw-downs [of the water table] in sections of the Great Artesian Basin and the damage could last for hundreds of years," Mr Hutton said. The basin is a major source of water for farmers and communities in inland Queensland.

Origin Energy managing director Grant King said he was confident the project would not harm the basin. "Our project has done an enormous amount of work in understanding the impact the project will have on water, acquifers and the Great Artesian Basin," Mr King said. "The technical work, the engineering and scientific work done by our teams gives us the confidence there wont be any adverse impacts."

Mr King said trials were under way to understand issues surrounding water management. He also said they were treating the unwanted water that comes up during the gas extraction. "That water is treated and applied for a number of beneficial uses and one of the uses could be reinjection [into acquifers]," Mr King said.

Mr Hutton said CSG companies did not know what to do with the unwanted water. "They dont know how to treat it to an acceptable level at an acceptable cost," he said. "They dont know what to do with the one million tonnes of salt a year that comes to the surface except to wack it into landfill. "Is it worth disrupting and sometimes destroying the farms that provide our food and fibre? "The cost of this industry is far too great."

GP: Ok. Let’s move onto the renewable energy target, because you’re obviously sort of closely involved with that now, being the largest energy retailer in the country. How do you see the renewable energy target being acquitted and, I guess we’re talking here, which technology by 2020?

GK: Well, clearly in the short term the market price of the two instruments under scheme now, the LRECs and the SRECs, is quite low and that tells us therefore that there is plenty of supply – and I think that the reason for that is pretty well understood, particularly generation of RECs from solar PV installations last year. And in our case, we’ve said quite publicly we have secured RECs that will probably cover our position inclusive of the recent acquisition in NSW for three or four years.

We do not expect this low price to remain, and the price has already started to move up from the lows of late last year, and in our view must inevitably get to a level that will cause more renewable energy assets to be built, because there is clearly insufficient renewable generation to generate a level of RECs required in the future years, and particularly the 2015 to 2020 period as the REC curve or the liability increase is substantially under the scheme. Now, it’s always difficult to call a forward market – and we couldn’t call all that movement towards replacement cost will happen in a year’s time or two years’ time or whatever – but inevitably it must rise because there is insufficient renewable generation yet in store to meet the future REC requirements of the market.

GP: Can you make any sort of call as to when that build does occur, whether it will be still mostly wind, or do you think other technologies will be capable of pushing some of the wind capacity aside?

GK: Well, I think one of the features of the current long REC position is that it probably will bring a bit of a pause to the development of wind assets. Origin has, for example, invested substantially in other technologies, primarily geothermal, and I think that probably means there’s another couple of years for us and others to do some more development activity around geothermal and see whether that can be a major source of RECs. But at the moment, you’d have to say that there is a substantial amount of wind development sites consented and in the consenting pipeline which I would have thought would have met the greater part, if not all, of that REC requirement.

So, it can, and it certainly could be met from wind, but we’ve probably got another couple of years to find out whether there are other technologies which will compete on a cost basis with wind. But certainly, from about at least I would think two years on, we’re going to start to need to see a substantial building or development of new renewable energy assets to meet the overall REC targets.

GP: Yes. And Origin has 3000MW of wind capacity in development, either with planning approval or not. Are you likely to develop your own wind farms to meet your own obligations or will you be seeking third parties where appropriate?

GK: We’ve done both. And in fact, historically, we’ve tended to buy more from third parties, either to buy RECs in the market or buy renewable energy from third parties; for example, Waubra is a case in point. Ultimately, that question is answered more in terms of the overall funding demand on Origin and we’ve got some quite, big projects underway, obviously the energy acquisition in NSW, but looking ahead, construction of APING.

GP: Ok. Can we just go back to geothermal because you mentioned that just a few moments ago? Origin made a a big write down on its investment in the so called Innamincka deeps, the hot dry rock technology. Symbolically, that was a bit of a blow to that particular technology. Is it simply a question of time? Or do you think it’s just going to be too hard?

GK: By the time we entered into that project, we were hopeful that that the Deeps could be developed in a time frame that was much more immediate and relevant. In other words, there was enough time left under the REC target through to 2020 to do a substantial amount of production in that period because that, of course, was a major economic driver for renewable energy and that investment in particular. Now it’s taken longer than we would have hoped a few years ago to move through that development path and therefore the economics of it are influenced by that, and therefore we feel it’s less likely to be developed, driven by the REC target through to 2020, because it’s just becoming less and less part of the asset’s overall economic life.

There is no question that the work done in the Deeps by Geodynamics has in our view confirmed that the heat resource is there. But it probably will take a bit longer to develop technologies to access that resource through the deeps in particular. At the same time we are investing in what we call the shallows which is the geological formations immediately above the deeps which are more in reach of conventional technology and therefore more capable of coming into production sooner, but for which the key question is: is there enough heat in that sedimentary basin? And clearly it’s cooler than the deeps because it’s shallower, but if there’s enough heat there, then I think the prospects for developing that are much more immediate and much more real because it’s within the reach of current technology.

GP: It is a much smaller resource, though, in general, isn’t it?

GK: Well, to the best of our knowledge, the Cooper Basin in broad terms is a far bigger resource than any other potential geothermal resource that we have in Australia. Now, that’s a reasonably studied comment, but we may prove to be wrong, but at the moment we would rate the Cooper Basin resource or the potential of that resource as much, much bigger. There’s more than enough resource there if we can access it through the shallows to make geothermal a major contributor to Australia’s renewable energy requirements.

GP: Ok. So, you think it could be developed in the time frame needed to be able to benefit from the renewable energy target?

GK: If we start to see a carbon price, then that gives a second bit of legs and second bit of momentum to the deeps. Our original involvement in the deeps was on the premise that the REC target would be increased which it was and it did offer a potential resource and technology that might be able to contribute to that target. But it’s important to say that that target’s finite, but ultimately a carbon price isn’t; it will go on forever. So, those sorts of technologies and resources will have their day.

GP: Skipping over to other technologies, Hydro – you talked of a fascinating new scheme in Papua New Guinea, a 1800MW run-of-river hydro scheme and its potential to provide energy for Australia. Can you tell us a little bit more about that, what you’ve learned since then and are you still as optimistic about that project as you were when you announced it? Have there been any developments at all since then?

GK: Well, we’ve continued to work on that project. At the time we announced it, we had done some preliminary studies on hydrology and transmission, etcetera, and construction. What we’re now doing is seeing various advices, engineering advices and environmental consultants to do the much deeper studies. That process is underway and it will probably take another year. At the end of that, we expect to have a much better defined understanding of a project and its costs. To the best of our knowledge, the project still remains very attractive conceptually and economically viable and, of course, any movement towards a carbon price will clearly increase the attractiveness of that resource.

Having said that, it’s a massive project. It takes a lot of effort and planning and development and capital make big projects happen, but we happen to think it’s a project that could significantly contribute to a change in the way we source our energy and certainly substantially lower the carbon intensity of generation, in Australia and New Guinea obviously because they’d be connected electrically. ...

GP: Can we talk about solar now? Fans of the solar technology are well aware of Sliver and its potential. That technology has now gone into a joint venture with Micron. Are we about to see the emergence of that technology?

GK: The aim of that joint venture was to migrate the IP, the technology we developed into Micron’s production facilities, and that process has progressed pretty much consistent with our expectations of a year ago. What we’re wanting to do is scale that production up and get product out in the market and establish the market acceptance for the Sliver technology. There should be increasing amounts of that product available through calendar 2011. We then need to get confident that we can scale the production of that technology up to the hundreds and hundreds of megawatts level and move that amount of product into the market.

And so, 2011 is a pretty important year because we will or have migrated the technology and we will get more product into the market and I would imagine by year end, we will have or we will be very close to making a decision as to whether we ramp that production up through the large capital investment. ...

GP: Can we just go quickly to electric vehicles? Origin opened its first charging point station recently. What’s your view of the electric vehicle market? How quickly do you think it would expand? And what role do you hope Origin plays in it?

GK: Well, we are very interested in that technology as we are in many other forms of technology for power use or for people’s engine needs. Now, we’ve historically not brought that much into the transport fuel sector of the market. We probably operate in the non transport space. But electric cars is one of those technologies that bridges those two spaces, and so we’re very interested in understanding the technology, the viability and the cost competitiveness of the technology. I don’t have a research reason for saying this, but my experience over many years is that it does take a while to get these technologies taken up in a way that they achieve a sort of critical mass to support the different sorts of fuelling infrastructure that you need, etc. At the end of the day, electric vehicles will have their place, but I’m not sure I would see them displacing the conventional, certainly in in the very long term, but not in the medium to long term.

GP: On Smart meters, what are your plans for the roll-out of Smart meters and the potential of smart metering technology?

GK: Well, clearly this is an issue that’s been grappled with in Australia where we’ve seen generally the roll-out of smart meters, in Victoria is the obvious example, where it’s been mandated by government and done through the network owners and, at the moment, that’s pretty much the state of play. And when I say ‘state of play’, no pun intended. I mean some states have mandated it, some states are running trials and the federal government is sponsoring trials to sort of test the viability and contribution this technology can make.

Again, we are very closely involved in some of those trials. We’re very closely involved in installing and selling, not so much residential but the SME commercial end of the market, to try and help customers understand how it might benefit them and help us understand how it might be best deployed. Large scale roll-outs of that technology is something that’s tended to be mandated by governments and promoted through the networks.

GP: The concept of the negawatt and this idea that energy companies might one day make more money by selling less energy, rather than by selling more energy, is that another Utopian view of where it might all end up or do you think that that’s actually a possibility?

GK: I can understand the seductiveness of that view, but for us to get us many consumers to get our energy, a lot of capital is invested. So, I think the real question ultimately on what it will cost us to get the energy is a question of what will we have to pay and the timing. The second point is – and we have the data for this – is that energy efficiency is improving, but there’s also not a lot of evidence that energy consumption is reducing and that equation balances simply because we tend to use more electricity in more applications than we’ve historically done. Now, I can’t say that will happen forever, but certainly at the moment that very positive trend of improving efficiency is at least in part offset by all of the lifestyle elements of the way we use energy.

TICKY FULLERTON: The deal is nearly $100 billion over 20 years. Was the high Australian dollar at all a barrier during negotiations?

GRANT KING: Not a barrier directly, Ticky, because these deals essentially are done in US dollars, so the sales are in US dollars and therefore the A dollar-US dollar exchange rate doesnt matter that much to the sales agreements. Where the exchange rate is relevant of course is to companies like Origin who are A dollar companies. And at the moment with high exchange rates and the capital costs ahead of us, thats actually quite favourable to the project.

TICKY FULLERTON: When would the money start flowing through because its come at a very good time for Queensland? Im thinking about when they might see some royalties.

GRANT KING: Well Queensland will benefit initially from the construction activity. The Finance Minister of Queensland, Rachel Nolan, who joined with us today was talking about $900 million a year of investment in regional economies in Queensland from now. So the regional communities in Queensland around Gladstone, Curtis Island and Gladstone community and then the Darling Downs region will benefit immediately. The project will take four to four and a half years to generate revenues and those revenues will of course then attract royalties so the Queensland Government at a Treasury level of course will begin to receive royalties from that time. But the community will benefit from direct investment immediately.

TICKY FULLERTON: What about the environmental side? Im thinking of the media around the Surat Basin in particular. Does your board see a real business risk here?

GRANT KING: Well I think the important thing to acknowledge is that we very much understand the communitys interests in this area, particularly environmental impacts and particularly on water, water table, ground water and water use for agricultural production. That sits very high on our risks, if youd like to think about it that way, our risk register and were working very hard to make sure that we understand those risks, those risks are manageable and we have a minimal impact on the community and on the environment. Now were quite confident because weve done extensive work in this area that these risks are all manageable, but we are very mindful of the concern and interest the community has, but we do believe the risks are very manageable.

TICKY FULLERTON: Now, Im thinking back to that Four Corners program in February and I know you guys came out a little bit better than your competitors. But the issues were particularly of farmers saying they were losing control of their properties and indeed that the water table, they think, might be sinking. But this issue of connected aquifers is an issue, isnt it?

GRANT KING: Well we think we have a very good scientific understanding of whats happening in the aquifers when we produce coal seam gas and we believe that the concerns around interconnection between aquifers and depletion of the water table should not be of great concern and is quite manageable. But I think the very important point is that were not just asking the community to rely on that assurance. Both state and federal government permits require very, very extensive monitoring of ground water through water bores on properties or on adjacent to properties were on and in the region. And I think its that very extensive monitoring that will see us pick up very early, whether there are any adverse impacts. And whilst we dont expect there will be, if there are we will see them very early and we can then ensure that theyre mitigated. ...

TICKY FULLERTON: In broad terms, are you seeing interest from the Japanese post the nuclear crisis over there?

GRANT KING: We are, but I think its very important to say that the Japanese are dealing very much with short-term issues at the moment. Theyve had to do an enormous amount of work to reconfigure their supply chain, their energy supply chain, and those that are in the LNG business today with spare cargoes are all working very hard to meet that increased demand from Japan and help Japan get through this sort of immediate crisis. Firstly - secondly, theres a very strong consensus in industry that demand for LNG in Japan will increase medium term, but it would be important to say that that Japanese interest on buying is very much short-term focused on buying cargoes at this point in time.

Traditional techniques such as adding insulation or window caulk can make buildings more energy efficient, but those strategies go only so far in reducing energy bills. Smart building systems linked to the smart grid offer a more comprehensive way to reduce consumption.

One company that has invested heavily in smart buildings is Schneider Electric, a 174-year-old French conglomerate that makes software and hardware for energy-efficient buildings. To test its own products, the company built a new headquarters campus near La Défense, the Parisian business district. Known as "Le Hive," the collection of interconnected buildings is a test bed for advanced sensor, measurement, analysis, and control technologies that promise to reduce the electricity bill for Schneider while proving to potential customers how powerful the technologies are.

Le Hive opened at the end of 2008, and it now holds more than 1,700 employees. There are no special energy-efficiency tricks embedded in the design of the building—it is typical of most new construction in Europe. The company wanted to use building systems to reduce energy consumption and not depend on expensive construction techniques that most building owners couldnt afford.

Schneiders goals for its headquarters were straightforward. The average electricity consumption of an office building in Paris is 400 kilowatt-hours per square meter per year. The European Union has directed that all buildings reduce consumption to 50 kilowatt-hours per square meter per year by 2030. Le Hive was meant to demonstrate that the path toward that goal can be quick and relatively painless. The company has reduced its headquarters energy consumption from more than 300 kilowatt-hours per square meter to 65.

The Schneider system, dubbed EcoStruxure, started by collecting and analyzing data on the buildings energy consumption patterns. Then a series of software and hardware components were installed, all of which can be controlled from a single interface such as a laptop or smart phone. In other words, the heating system, the air-conditioning system, the lighting management system, the security system, the fire control system, the surveillance system, the IT system, and the ventilation system (all of which used to be discrete systems with separate controls and dedicated technicians and managers) are all integrated into a single comprehensive building management system with a single point of control.

Next, RFID cards were distributed to every employee. Each card alerts a sensor system to where the employee is and adjusts the lighting and HVAC systems accordingly. A worker leaves his office for lunch, for instance, and the lights and air-conditioner in that office turn off immediately. He returns and the comfort settings he has requested kick right in. Other sensors turn the artificial lighting up or down in accordance with the available sunlight. Similarly, an automated window shading system adjusts itself in calibration with the cooling, heating, and lighting needs. If the blinds are open and sunlight is streaming in, then the lighting system dims by just the right amount to maintain a consistent environment.