Enterra Insights

Portable Power

In yesterday's post entitled Better Batteries or No Batteries at All, I discussed some of the research being conducted and products being manufactured that generate power in new ways. In that post, I wrote, "The world is becoming more mobile and that mobility is fostered by battery-powered devices of all sorts." In this post, I would like to discuss a few other ideas that are helping make power more portable. Let's start with kid power. In 2008, I wrote a post entitled from From Solar Power to Kid Power in which I discussed a team from Brigham Young University that created a playground merry-go-round that "generates enough electricity to charge between 12 and 24 lanterns, depending on how often children play on it." A team from Harvard University -- an all-girl team -- has now created a soccer ball that can generate electricity ["Energy-generating sOccket soccer ball scores a goal in off-grid villages," by Jeff Salton, Gizmag, 8 February 2010]. Salton reports:

"What kid doesn’t like kicking around a soccer ball? Imagine if this fun activity could also provide enough energy to power something useful in a modest off-grid African village, like a reliable light to cook by or an emergency mobile phone. The sOccket is a prototype soccer ball that captures kinetic energy when it is kicked or thrown, stores it in an internal battery and makes that energy available for a myriad of small but useful purposes. In other words, it’s a fun, portable energy-harvesting power source that is designed to take a kicking."

One only need look at the fervor created by the World Cup to understand the potential that a soccer ball (or football as most non-Americans know it) has for generating small amounts of electricity. How does the sOccket ball do it? Salton explains:

"The sOccket captures kinetic energy through an inductive coil mechanism similar to the nPower PEG that can charge mobile devices by shaking. As the ball is kicked around, a magnet is drawn through a coil which creates a current that is then stored on a battery. This technological wizardry means the sOccket weighs slightly more than a regular 16-oz soccer ball (5-oz more), but the sOccket team say it is anticipating its design will get even lighter. They are also investigating using local materials, meaning product from Africa where the product is targeted."

In past posts, I've noted how important mobile phones have become in Africa. Charging those phones, however, has been a challenge because, as Salton notes, "95 percent of African countries live off-grid with no access to electricity." As a result, people have gone to great lengths to get their phones charged. Salton continues:

"The girls at sOccket say that people in some developing countries have been known to walk for three hours just to find an outlet from which to charge a mobile phone. With one of the special soccer balls, the team says the power will literally be in the people’s hands. They anticipate 15 minutes of play time equaling roughly three hours of power for an LED light."

Getting kids to play soccer shouldn't be much of a challenge; neither should figuring out a number of ways to use the electricity that is generated. The team that developed the sOccket ball wasn't just thinking about mobile phones when they developed it. Salton explains:

"The sOccket team says it hopes the invention will help prevent house fires caused by kerosene lamps relied on for lighting by more than 1 billion people worldwide. They report that kerosene is not only expensive in many areas but also highly flammable and the smoke has been known to cause respiratory problems in infants and adults."

Salton raises one big issue that could cause a bit of strife: Who gets to use the power stored in the ball after the game?

"The big issue for sOccket isn't deciding who kicks the winning goal in a soccer match, but rather who gets to use the power from the ball after the game. To help solve this conundrum, the sOccket team is working within social settings like schools, hospitals and churches, and a recent trip to Kenya has also been beneficial in giving the team a better understanding of individual households' needs. ... Currently the sOccket is still at the prototype stage but the team hopes to have a completed version that can be distributed by the end of 2010."

In his article, Salton mentioned the nPower PEG, which is another device that generates electrical power from body motion. Most people have seen emergency flashlights that can be powered up by shaking them to generate small amounts of electricity. The nPower PEG works on the same principle ["nPower PEG uses motion to charge mobile devices," by Noel McKeegan, Gizmag, 7 January 2010]. According to McKeegan, "the 9" long, 9 ounce device from Tremont Electric works when you are in motion - just plug in your mobile device, place the nPower PEG vertically in your bag or on your hip and go for a walk or run. The kinetic energy from this movement is harvested to deliver charge at the same rate as a wall charger. This translates to an 80% for most devices in an hour of walking according to the company." Another portable device that generates power using kinetic energy is a charger called the Etive, designed by Kyle Toole ["The Etive kinetic energy charger gives power walking a whole new meaning," by Jude Garvey, Gizmag, 20 May 2009]. Garvey reports that "with further development, the Etive should be capable of recharging a 2000mAh lithium-Ion battery in about five hours."

Another, more direct, approach for generating power using human motion has been developed by a company named Easy Energy, Inc. ["YoGen charger uses your energy for its power," by Jude Garvey, Gizmag, 4 January 2010]. Garvey reports:

"The YoGen charger works a little bit like the friction cord on the back of a talking doll – you simply repeatedly pull the T-handle and the internal alternator starts spinning. This eventually creates enough power to charge the batteries of most small, portable electronic devices. The ergonomic design of YoGen offers extended charging effort with little operator fatigue. Importantly, it provides 100% green energy and mostly charges devices with only a few minutes of pulling and releasing the T-bar."

A team of scientists from the Georgia Institute of Technology is also working on a way to harness human kinetic movements to generate energy but its approach involves nanotechnology ["New nanogenerator could charge iPods and cell phones with a wave of the hand," by Darren Quick, Gizmag, 30 March 2009]. Quick reports that the Georgia Tech research team takes kinetic devices to the next level. These new devices would "use simple body movements, the beating of the heart or movement of the wind, and convert the low-frequency vibrations generated into electricity by using zinc oxide (ZnO) nanowires." Quick continues:

"A major advantage of this new technology is that many nanogenerators can produce electricity continuously and simultaneously. Add to that the potential to reduce the billions of batteries that make their way into landfill annually and the technology sells itself. On the downside, the greatest challenge in developing these nanogenerators is to improve the output voltage and power."

A team from the Massachusetts Institute of Technology is also drawing power from the human body; but they are using heat rather than kinetic energy ["Researchers harness heat to power electronics," by Darren Quick, Gizmag, 17 February 2010]. Quick explains:

"Efforts to capture energy from the human body usually focus on harnessing the kinetic energy of the body’s movement. However the human body is also generating energy in the form of heat that could also be used to run low power electronic devices. New energy-scavenging systems under development at MIT could generate electricity just from differences in temperature between the body (or other warm object) and the surrounding air. ... The unique aspect of the new devices is their ability to harness differences of just one or two degrees, producing tiny (about 100 microwatts) but nevertheless useful amounts of electricity. While it won’t be enough to recharge your mobile phone, it should be enough to power low power devices, such as biomedical monitoring systems or sensors in remote and inaccessible locations. ... The key to the new technology is a control circuit that optimizes the match between the energy output from the thermoelectric material (which generates power from temperature differences) and the storage system connected to it, in this case a storage capacitor. Such a system, for example, could enable 24-hour-a-day monitoring of heart rate, blood sugar or other biomedical data, through a simple device worn on an arm or a leg and powered just by the body’s temperature which, except on a 37 degree C (98.6-degree F) summer day, would almost always be different from the surrounding air). It could also be used to monitor the warm exhaust gases in the flues of a chemical plant, or air quality in the ducts of a heating and ventilation system."

Not all portable power solutions rely on human inputs because such motion generally doesn't produce enough power to operate larger mobile devices. For producing larger amounts of stored electricity, solar power seems to be the approach of choice ["Making Solar Power Portable," by Liz Galst, New York Times, 8 February 2010]. Galst reports:

"Last year, when Jonathan Smith was still the president of Earth911.com, a Web site dedicated to recycling, he said he would often board a plane after a speaking engagement or a day of meetings with a dead cellphone in hand. With limited recharging options available, 'it was really frustrating,' he said. 'Having access to a working port or finding an open plug during layovers at the airport was just too unpredictable.' Hoping to solve his problem, Mr. Smith bought a portable solar charger he could prop up in the window of a plane. 'I’d plug it into my phone and when we landed, I was ready to go again.' The charger meshed well with his environmental values, of course. Still, 'when I first started using solar to charge my devices,' he said, 'it was out of convenience.' In fact, Mr. Smith is one of a growing number of business travelers who, out of practicality or concern for the environment, use portable renewable energy devices — primarily portable solar panels, but also hand-cranked electricity generators known as dynamos or freeplay devices — to power up their electronics when they work in places that offer little or no access to electricity."

Smith's mobile phone battery challenge pales in comparison to challenges faced by researchers in the field far from power grids. Galst explains:

"'Basically, this technology makes our work possible,' said John Poulsen, a tropical ecologist who investigates logging’s effects on animal populations in the forests of central Africa. Often, data collection takes Mr. Poulsen as much as 25 miles from the nearest road. 'The research we do requires being in the forest for two to three weeks at a time. And if we had to go back to the village every two or three days for batteries, we just couldn’t do it,' he said. Generally speaking, portable renewable energy devices cannot power large equipment, like desktop computers or printers. But they can generate enough electricity to operate laptops, satellite telephones, movie and still cameras, sound-recording equipment, GPS equipment and camp lighting, said Stuart Cody, owner of Automated Media Systems in Allston, Mass. The company customizes portable solar arrays and battery backup systems for business travelers and adventurers. The devices have improved significantly since they were first introduced in the mid-1990s. That was about the time the tree kangaroo conservation program, administered by the Woodland Park Zoo in Seattle, began using portable solar at its field sites in Papua New Guinea. “Initially, we got panels that didn’t work very well,” said Lisa Dabek, the zoo’s director of field conservation. Now, the solar panels used to power laptops, navigation devices and satellite phones 'are much smaller and much more portable,' she added. The organization uses this technology for reasons that have as much to do with practicality as with environmental concerns. Fuel-powered generators, Ms. Dabek said, are 'very heavy. And to hike uphill with them for two days is not really an option.' Moreover, generators 'make a lot of noise that would scare away the tree kangaroos.'"

When it comes to mobile solar panels, however, nothing compares to "a low-power sensor system developed at the University of Michigan that is 1,000 times smaller than comparable commercial counterparts" ["Millimeter-scale, energy-harvesting sensor could operate almost perpetually," by Darren Quick, Gizmag, 9 February 2010]. Quick reports:

"Researchers have developed a solar-powered sensor system that is just nine cubic millimeters in size. It is 1,000 times smaller than comparable commercial counterparts and can harvest energy from its surroundings to operate nearly perpetually. The system could enable new biomedical implants as well as building and bridge-monitoring devices. It could also vastly improve the efficiency and cost of current environmental sensor networks designed to detect movement or track air and water quality. The system’s industry-standard ARM Cortex-M3 processor, solar cells and battery are all contained on its tiny frame, which measures 2.5 x 3.5 x 1mm. The engineers say successful use of an ARM processor - the industry’s most popular 32-bit processor architecture - is an important step toward commercial adoption of this technology. ... The sensor spends most of its time in sleep mode, waking briefly every few minutes to take measurements. Its total average power consumption is less than one nanowatt, which is one-billionth of a watt."

You won't be recharging your iPhone with this sensor, but, like the other systems that generate small amounts of power discussed above, it could play an important role in health care. Quick concludes:

"The designers are working with doctors on potential medical applications. The system could enable less-invasive ways to monitor pressure changes in the eyes, brain, and in tumors in patients with glaucoma, head trauma, or cancer. In the body, the sensor could conceivably harvest energy from movement or heat, rather than light, the engineers say."

As I noted at the beginning of this post, the world is becoming more mobile and that mobility demands the ever increasing use of mobile devices that require electrical power. I suspect that we will continue to see a number of breakthroughs in the years to come in both mobile devices and the way we power them.

Better Batteries or No Batteries at All

The information age is as much an age of electricity as it is an age of digitization -- and that is probably not going to change. Cars are becoming more electrified. The world is becoming more mobile and that mobility is fostered by battery-powered devices of all sorts. As Curt Suplee observes, "Since the opening bell of the wonder-stuffed 21st century, consumer technologies have evolved at an electrifying pace ... batteries not included" ["Talk about battery life! Old device, new tricks." Washington Post, 20 October 2009]. When you think about it, Suplee is correct. Battery technology has changed much more slowly than other technologies -- even though the world is becoming more dependent on them. Suplee explains why this is so:

"Despite the promotional zeal of those drum-toting bunnies, the alkaline battery that powers most of our portable gizmos is not different in principle from the model that Alessandro Volta created in 1800. That fabled 'voltaic pile' -- a stack of alternating zinc and copper disks separated by layers of brine-sodden-paper -- didn't look much like today's sleek cylinders. But it was the first battery as we understand the term -- that is, a device that turns stored chemical energy into electrical energy. And its successors are still using the same kind of system. Is this retro-electro condition a failure of modern science? Well, no, for two reasons. The first is that the newest versions of Volta's pile produce amazing boing for the buck and are poised to get better. The second and most important reason that battery tech may seem to be lagging is that beyond a certain point you can't shrink chemistry. Digital data are almost infinitely compressible because the information is not a physical object. It can be embodied in the smallest difference between any two conditions -- on or off, 0 or 1 -- way down to subatomic scale. But batteries aren't digital. 'Energy is stored on stuff -- atoms, ions and so forth,' says MIT professor Gerbrand Ceder. 'This is done by transferring electrons from one atom to another. Their energy difference is the energy stored. That's why batteries will never scale in performance the way, say, semiconductors have done.'"

Normally when we think about batteries, we think about cylinders or cubes that go inside devices or vehicles. But that could change. A British university is developing a material that could perform as both a covering and a battery ["Future cars: Auto bodywork composite doubles as a battery," by Tannith Cattermole, Gizmag, 7 February 2010]. Because the new battery does not rely on chemical reactions, it offers a revolutionary way forward. Cattermole reports:

"The problem is clear. Hybrid cars and EVs rely on batteries for power, but batteries are bulky and heavy, causing the car to use up more energy. But what if a car's bodywork was made of a strong, lightweight material that could store and discharge electrical energy just as a conventional battery does? In pursuing this goal, researchers at the Imperial College London are developing a key building block for the hybrid car of the future, and the implications go way beyond automobiles - think wafer thin mobile phones and laptops that don't need a separate battery because they draw power from their casing. Imperial College has been working on the idea as part of a €3.4 million 3 year European Union-funded project which includes researchers from a number of European partners, including automotive firm Volvo. The prototype material is a composite of carbon fibers and a polymer resin which can store and discharge large amounts of energy much faster than conventional batteries. Unlike these there is little degradation in the material over time because there is no chemical process involved, and this also aids more rapid recharging. It is lightweight and strong enough to make car body parts, and could be plugged into the household power supply for recharging."

At the moment, the material is still in the research and development phase.

"Researchers say the next stage is to further develop the composite in order to store more energy. This may be achieved by growing carbon nanotubes on the surface of the carbon fibers which will increase the surface area, thus improving its storage capacity. They also hope to find alternative options for recharge such as recycling energy created during braking while the car is on the move. Their first test in-situ will be to exchange the metal floor in the car boot, or wheel well, for the composite, and Volvo is investigating the possibility of rolling this out in prototype cars for testing purposes. The addition of the composite combined with a reduced need for heavy batteries could see the car's overall weight drop by up to 15%, consequently increasing the range of future hybrids."

As I've noted in previous posts, for a concept to move from being an idea to an innovation, it must actually be produced and widely used. Once the material is perfected, manufacturing it becomes the next big hurdle. Cattermole concludes:

"The most effective method for manufacturing the composite material at an industrial level is also being investigated. Project co-coordinator, Dr Emile Greenhalgh, from the Department of Aeronautics at Imperial College London, says: 'We are really excited about the potential of this new technology. We think the car of the future could be drawing power from its roof, its bonnet or even the door, thanks to our new composite material. Even the Sat Nav could be powered by its own casing. The future applications for this material don’t stop there – you might have a mobile phone that is as thin as a credit card because it no longer needs a bulky battery, or a laptop that can draw energy from its casing so it can run for a longer time without recharging. We’re at the first stage of this project and there is a long way to go, but we think our composite material shows real promise.' The future for the Hybrid car looks bright ... and batteries are definitely not included."

Although batteries remain the most likely source of power for mobile devices in the future, they may not be the only option. American researchers are developing a material that harnesses body motion to generate electrical power ["Rubber sheets harness body movement to power electrical devices," by Darren Quick, Gizmag, 27 January 2010]. Like the carbon material discussed above, the new material doesn't use chemical reactions to do its job. Quick reports:

"Engineers from Princeton University have developed power-generating rubber films that could be used to harness natural body movements such as breathing or walking in order to power electronic devices such as pacemakers or mobile phones. The material, which is composed of ceramic nanoribbons embedded onto silicone rubber sheets, generates electricity when flexed and is highly efficient at converting mechanical energy into electrical energy. Its developers say shoes made of the material could harvest the pounding of walking or running to power mobile electrical devices and, when placed against the lungs, sheets of the material could use the raising and falling breathing motions of the chest to power pacemakers. This would negate the current need for surgical replacement of the batteries which power the devices. Plus, because the silicone is biocompatible and is already used for cosmetic implants and medical devices, 'the new electricity-harvesting devices could be implanted in the body to perpetually power medical devices, and the body wouldn't reject them,' said Michael McAlpine, a professor of mechanical and aerospace engineering, at Princeton, who led the project to develop the material."

Quick reports that nanotechnology is also involved in the production of the Princeton material. He continues:

"To produce the material the researchers first fabricated lead zirconate titanate (PZT) nanoribbons in strips so narrow that 100 fit side by side in a space of a millimeter. PZT is a ceramic material that is piezoelectric, meaning it generates an electrical voltage when pressure is applied to it. Of all piezoelectric materials, PZT is the most efficient, able to convert 80% of the mechanical energy applied to it into electrical energy. 'PZT is 100 times more efficient than quartz, another piezoelectric material,' said McAlpine. 'You don't generate that much power from walking or breathing, so you want to harness it as efficiently as possible.' In a separate process, the team then embedded these ribbons into clear sheets of silicone rubber, creating what they call 'piezo-rubber chips.' The Princeton team is the first to successfully combine silicone and nanoribbons of PZT. In addition to generating electricity when it is flexed, the opposite is true: the material flexes when electrical current is applied to it. This opens the door to other kinds of applications, such as use for microsurgical devices, McAlpine said. 'The beauty of this is that it's scalable,' said Yi Qi, a postdoctoral researcher who works with McAlpine. 'As we get better at making these chips, we'll be able to make larger and larger sheets of them that will harvest more energy.'"

Progress is being made in a number of areas related to flexible materials that can harvest energy. For example, "The New York-based Center for Architectural Science and Ecology CASE has unveiled a new Integrated Concentrating (IC) Dynamic Solar Facade which does just that - and it looks great!" ["Solar glazing chases sun from dawn until dusk," by Tannith Cattermole, Gizmag, 3 February 2010]. The CASE system uses a miniaturized concentrator solar cell, a tracking system, and a glass pyramid shape to track "the sun's progress across the sky, maximizing light gain all day long. The glass pyramid shape magnifies the light available and additionally serves to capture thermal energy." Cattermole continues:

"This advanced technology provides a number of advantages over current BIPV [Building integrated photovoltaic] systems according to CASE. Not only does IC use as much sunlight as possible in the production of electricity, it also allows greater diffuse light to enter the building reducing the need for artificial light. Additionally it can be applied to both retrofit applications and new construction, requires little maintenance and is modern and aesthetically pleasing. And what's more, the thermal energy trapped by the glass pyramid design is funneled for use in the building's heating or cooling systems. Incorporating these types of arrays could see solar energy becoming an increasingly viable option that is competitive with other energy sources, reducing our dependency on fossil fuels."

Other advances reported by Gizmag over the past few years include: flexible solar panels ["Flexible Cells to expand Solar Energy applications," by Mike Hanlon, 2003]; flexible panels that could be used on the outside of buildings ["Flexible modules could transform windows and buildings into solar panels," by Emily Clark, 10 October 2007]; solar bricks ["Solar brick provides integrated outdoor lighting solution," by Emily Clark, 22 September 2008]; and semi-transparent solar windows ["RSi unveils semi-transparent solar window," by Emily Clark, 14 December 2008]. All of these items are intended to be visible to the public, rather than hidden inside objects like batteries. Tomorrow I will discuss other creative ways that are being developed to make power more portable. Comedian Stephen Wright once remarked, "I bought some batteries, but they weren't included." In the future, Mr. Wright could just be correct.

Update on Niger

I first discussed the country of Niger last April in a post entitled Commodity Economics: Feast or Famine. The post discussed the importance of diversifying national economies. I pointed to Niger as an example of a country that relies too much on a single commodity to keep the country afloat. In that post, I wrote:

"Last year's [2008] rising oil and natural gas prices created renewed interest in nuclear power, which, in turn, increased interest in uranium. Niger sits on top of one of the world's richest uranium deposits and the citizens of Niger have begun fighting over who should control it and profit from it. ... Profits from the extraction of uranium could work miracles in Niger. However, conflict and corruption, the twin curses of so many resource rich African states, threaten to crush any dreams of a better future. ... The battle for control of resources in northern Niger is as much cultural as economic. The nomads who have occupied the land that sits atop the uranium deposits have historically been considered outcasts by those living in the richer agricultural region to the south. Now, however, the lands to the north account for 70 percent of the country’s export earnings; yet, the nomads living there have seen little benefit from profits being made. As the fifth largest producer of uranium in the world, the conflict in Niger over how extraction profits should be used will probably linger for decades (which means profits will probably be consumed by war rather than benefitting the country's economy)."

A few month's later (in July) I once again brought up Niger as a negative example of how to run a country. In post about The Temptation of Power, I wrote:

"Another leader that is making a grab for additional power is Niger's President Mamadou Tandja ["Niger Senses a Threat to Its Scrap of Democracy," by Adam Nossiter, New York Times, 13 July 2009]. Nossiter reports:

"Tens of thousands have taken to the streets to protest President Mamadou Tandja’s slow-moving coup d’état, as his critics call it: his plan to stay beyond the legal limit of two terms in his colonial-era palace, a gleaming oasis of whitewashed order amid dilapidated government buildings and mud-brick houses. In his push for a new constitution that would abolish term limits and give him more power after 10 years as president, Mr. Tandja dissolved a high court that ruled against his bid to remain in office; dismissed a fractious Parliament; took steps to muzzle the press, including shutting down a radio and television station; and arrested opposition leaders."

The temptation for leaders to stay in power is almost irresistible. Only when institutional safeguards are stronger than the political power of a country's ruler is democracy safe."

Ironically, I opened that post by discussing the military overthrow of Honduran President Manuel Zelaya. It's ironic because Mamadou Tandja has now also been overthrown in a military coup ["Soldiers Oust President in Coup in Uranium-Rich Niger," by Cassandra Vinograd and David Gauthier-Villars, Wall Street Journal, 19 February 2010]. Vinograd and Gauthier-Villars report:

"Soldiers staged a coup in the uranium-rich West African nation of Niger, ... announcing they had suspended the constitution after seizing President Mamadou Tandja amid a barrage of gunfire. Dressed in military uniform, a spokesman for a group calling itself the Supreme Council for the Restoration of Democracy appeared on Niger's Tele Sahel, ... surrounded by fellow members of the armed forces. Without mentioning President Tandja, the spokesman, Col. Abdul Karim Goukoye Karimou, read from a statement saying the constitution and all institutions were suspended in the group's move to take responsibility and ease political tension in the country. We want Niger 'to be an example of democracy and governance,' the colonel said, calling for an end to 'lies' and 'corruption.' The coup leaders said they had ordered the country's borders closed and had imposed a curfew."

It sounds oxymoronic for a military spokesman to declare that force was used in an effort to restore democracy. In this case, however, they may be sincere in their intent. Although the international community remains opposed to military coups, this one was not really much of a surprise. Vinograd and Gauthier-Villars continue:

"'This didn't come as a surprise," Dr. [Adrienne Diop, spokeswoman for the Economic Community of West African States,] said. 'There has been a crisis for the past six or seven months. We were hoping that there would be a peaceful settlement to dialogue between the opposition and the government, but the community couldn't bring the parties together through mediation.' ... Mr. Tandja had been in power since 1999, when his election ended a period of coups and rebellions. He was re-elected in 2004 to a second five-year term that was to end in December. But protests arose last year as he moved to extend his grip on power, invoking extraordinary powers to rule by decree after dissolving parliament and the constitutional court, which opposed his plan for a referendum removing term limits. International efforts to stabilize the situation, with the European Union suspending nonhumanitarian aid, failed to halt the deterioration."

Vinograd and Gauthier-Villars report that "through French state-controlled nuclear-energy company Areva SA, France has a de facto monopoly on Niger's uranium output. In recent years, however, Niger has tried to open up its uranium-mining industry to other foreign partners, granting mining concessions to companies from China, for example." The coup appeared to have been relatively blood-free and to have had broad support among Niger's citizens. President Tandja is reportedly under arrest in a villa next to the presidential palace. In the days following the coup, Niger's military has continued to insist that they are going to restore democracy to the country ["Niger Junta Gives Assurances on Democracy Plans," by Adam Nossiter, New York Times, 21 February 2010]. Nossiter reports:

"The military junta that deposed Niger's longtime leader ... sought to assure visiting diplomatic delegations ... that it would soon restore democracy, as more signs emerged that the violent overthrow had been widely welcomed in this impoverished West African desert nation. Junta leaders met with representatives from the United Nations, the African Union and the Economic Community of West African States, telling them that the new government would 'work with Nigériens of all political leanings,' said Mohamed Ibn Chambas of the economic community. 'We received very clear assurances,' he told reporters. ... Crowds of demonstrators ... greeted Niger’s new military rulers with outpourings of support in the streets."

A return to democracy in Niger will be welcomed. Unlike Honduras, however, where the international community unsuccessfully argued that President Zelaya should be returned to power, no one seems to be pressuring the junta in Niger to return President Tandja to power. The reason, of course, is that Tandja was widely perceived as a corrupt and incompetent leader. Niger desperately needs good governance and leaders who place the needs of the country ahead of personal ambitions. With the future of the nuclear power industry looking brighter than it has in decades, Nigérien leaders need to invest uranium profits wisely so that the country's economy can diversify and its people find hope. Nigérien leaders will also have to heal the rift between the residents in the south and the nomads in the north so that conflict doesn't derail development plans. It's way too soon to determine whether the coup will lead to a brighter future. For now, Nossiter reports that life appears "to be returning to normal, with shops reopening and traffic flowing again." He concludes:

"Niger has endured a succession of coups that did not bring democracy. 'They are saying they want democracy, but for that one has to see the composition of the junta,' said Mahaman Tidjani Alou, a political science professor at the University of Niamey. He noted that the most visible members of the junta so far were not among the country’s top military leaders. 'One has the impression that this is a fringe element,' he said. 'The question we are asking is, "What do they want to do with power?"' Mr. Alou said. 'What do the putschists want, who are they? These are the questions that remain absolutely open,' he said. 'We are waiting to see what’s going to happen.' Yet Mr. Tandja’s government remains so negatively marked in the minds of many here that this latest upheaval, despite all the questions attached, appears to be generally seen as a release."

Nigériens, as well as the rest of the world, will wait with bated breath to see what happens. Hopefully, the country will come together to restore democracy, heal internecine wounds, and start down the road to development.

Filling the Supply Chain Black Hole

Lora Cecere, a market analyst with whom Enterra Solutions recently started working, writes a blog under the title Supply Chain Shaman. Since Enterra Solutions is getting ever deeper into the supply chain business, I've included a link to Lora's blog on this blog's sidebar. Lora's website site explains the thinking behind the blog's title:

"A shaman interprets and connects the evolving world to a group of followers. Lora does this for [the] supply chain. As a partner with Altimeter Group and the author of [an] enterprise software blog, Lora travels the world to chart the course of supply chain practices and disruptive technologies. Her blog focuses on the use of enterprise applications to drive supply chain excellence and builds on Lora’s prior popular blog. As an enterprise strategist, Lora focuses on the changing face of enterprise technologies. Her research is designed for the early adopter seeking first mover advantage."

In a recent post entitled The Supply Chain Black Hole, Lora talks about how important transactional supply chain applications are for success in both the near- and the far-term. She writes:

"We have a black hole in the center of supply chain applications. A black hole you say? Yes, a black hole has developed between transactional systems focused on order-to-cash and procure-to-pay processes and supply chain optimization technologies. It is not there by design. It has evolved because the design of supply chain technologies were insufficient to meet today’s requirements."

For those of you not familiar with the terms "order-to-cash" and "procure-to-pay," let me explain. Order-to-cash refers to the Enterprise Resource Planning (ERP) process of taking customer sales orders (which can be done in numerous ways such as: over the Internet, through email, via a sales person, by fax, electronic data interchange (EDI), etc.) and then fulfilling the order, shipping it, generating an invoice, collecting payment for that invoice, and then providing receipt upon receiving payment. Procure-to-pay or purchase-to-pay, often abbreviated to P2P, is another broad term that refers to business processes that involve requesting (requisitioning), purchasing, receiving, paying for and accounting for goods and services. It has also been called "Req to check." The "black hole," Lora asserts, lies between the system operated by customer and the system used by the supplier. She continues:

"What is a black hole? In quantum mechanics terms, it is the region of space from which nothing can escape. It is the result of the deformation of space time caused by a very compact mass. Around the black hole, there is an undetectable surface which marks the point of no return, termed the event horizon by scientists. It is called 'black' because it absorbs all light that hits it, reflecting nothing, just like a perfect black body in thermodynamics. Despite the invisible interior, a black hole can be observed through its interaction with other matter. Companies may not realize it, but they have a black hole. It is the no-man’s land between ERP and Supply Chain Optimization (APS)/Supply Chain Execution (SCE) systems. We now know that fixed data integration, one-dimensional rules mapping, and traditional master data techniques from ERP to Supply Chain Optimization are insufficient. As a result, plans are created and consumed in isolation, and transactional systems hum along with little – to no — guided intelligence. Available-to-Promise (ATP) was our first foray into the black hole, but we did not go far enough."

Available-to-promise is a business function that provides a response to customer order inquiries, based on resource availability. ATP processes determine available quantities of a requested product and promises appropriate delivery due dates. In other words, ATP supports order promising and fulfillment by managing demand and matching it to production plans. ATP is a reasonable approach and it begs the question why "didn't it go far enough"? Lora believes that ATP processes don't exchange enough information in a timely manner to stop the black hole from developing because they can't "sense" what's going on in real time. She continues:

"Technologies are evolving to eliminate the supply chain black hole. In this first generation of supply chain applications, we have built a fixed response with very little sensing. How can we effectively respond when we cannot sense? It is my belief, from seven years studying the market, that the technology applications to fill the black hole will come in many forms and from many different sources. From military technologies, we will see the applications of rules-based ontologies to intelligently sense and connect optimization plans to more intelligently drive transactional systems. Likewise, from the banking and insurance industries, we will see the application of pattern recognition of early market conditions to shape the supply chain response; and from search-engine optimization technologies (SEO), we will see the redefinition of master data management. These technology discontinuities will come from emerging technologies: guys that we don’t even know the names of today."

Since Enterra Solutions is one of those "guys" that will fill the black hole, you can understand why I became interested in Lora's work and analysis. The "rules-based ontology" applications to which she refers are being developed by Enterra Solutions' brilliant technologists. I first touched on this work in a post entitled Profiting From Following the Rules. I'll be writing a lot more on the subject in the months ahead. Lora concludes her post with some recommendations on where those looking to solve the black hole problem need to focus and how businesses should proceed as they move forward. She writes:

"We will be limited in how fast we move by our own traditional supply chain paradigms. To solve the black hole, we need to shake several paradigms and recognize that:

• First generation were a start, but were not sufficient. The first generation of supply chain applications got us started down the path, but they must be cast-off to move forward. ERP is not the backbone of supply chain management for the future. The new technologies will not come from the ERP consolidators.
• Need to Bridge the Discontinuity. We are at a discontinuity between inside-out and outside-in technologies. The new technologies will be outside-in. They will help us sense before responding. They will help drive an intelligent response. They will fill the black hole.
• Requires a Focus on Innovation. Companies will be challenged to evolve old technology while maximizing the opportunities from evolving technologies at the same time. Early adopters have line-of-business scouts seeking to extract new answers to solve the black hole dilemma."

Although Lora indicates that those addressing supply chain challenges "have come a long way," she believes there is still a ways to go before companies solve "the black hole problem." The search for solutions, she claims, "will be exciting." I couldn't agree more.

Food Security: Globalization versus Self-Sufficiency

Politicians continually bring up the subjects of energy and food security; but they mostly discuss them in economic terms. They stir populist fervor by saying that they will promote policies that foster national self-sufficiency in both sectors. For Americans, such policies sound great -- who doesn't want to decrease the flow of money out of the country for oil and food and reduce the trade deficit? In the age of globalization, however, such efforts have proven stillborn. Why? Mainly because Americans like their cars, appreciate variety in their diet, and remain consumers who like the lowest prices they can find. Of course, Americans aren't alone in discussing security issues in terms of becoming self-sufficient.

The 2008 food crisis started a lot of countries thinking about how they could secure their food supplies and their ponderings often led them down the self-sufficiency path. That begs the question, "Is food self-sufficiency a good thing or a bad thing?" Cargill, an international producer and marketer of food, agricultural, financial and industrial products and services, believes self-sufficiency is an unrealistic goal at best and could threaten global food security at worst ["Cargill warns on self-sufficiency," by Javier Blas, Financial Times, 10 November 2009]. Blas quotes a top executive at Cargill who claims "that the idea that countries 'can be self-sufficient in every single food is a nonsense'." He's probably correct; but his views won't change the genuine concerns that people have about food security in the decades ahead. Blas' article was written prior to World Summit on Food Security held last November in Rome. At that summit, world leaders "unanimously adopted a declaration pledging renewed commitment to eradicate hunger from the face of the earth sustainably and at the earliest date" [World Summit on Food Security, Food and Agriculture Organization of the United Nations].

Of course it's easy to adopt declarations, make pledges, and speak out. Following through on all the rhetoric, by keeping commitments and making progress, is much more difficult to do. Although one can find hungry people in every country in the world, the one billion chronically-hungry people of the world are mostly found in developing countries. As the FAO web site asserts, "Poor countries need the development, economic and policy tools required to boost their agricultural production and productivity. Investment in agriculture must be increased because for the majority of poor countries a healthy agricultural sector is essential to overcome hunger and poverty and is a pre-requisite for overall economic growth. The gravity of the current food crisis is the result of 20 years of under-investment in agriculture and neglect of the sector. Directly or indirectly, agriculture provides the livelihood for 70 percent of the world's poor." Since most of these countries remain agrarian, exporting some food products is essential to help them develop a sustainable economy; hence, the concern about the movement towards self-sufficiency. Blas continues:

"Countries in Asia, Africa and the Middle East have moved towards self-sufficiency in response to the crisis, either by boosting agricultural production at home through subsidies and import tariffs or acquiring overseas farmland. The so-called 'farmland grabs' gained notoriety after an attempt by South Korea’s Daewoo Logistics to secure a huge chunk of farmland in Madagascar, which contributed to the collapse of the African country’s government. Paul Conway, senior vice-president at Cargill, said: 'Promoting a free and open trading system whereby countries can produce what they are best able ... and surpluses can be traded across international boundaries is the right way to go. Not all countries can single-handedly be self-sufficient in all food commodities.'"

For more information about the so-called "farmland grabs," read my posts entitled Food and Water Shortages in the Middle East, Buying the Farm and An Update on Buying the Farm. In the first of those posts, I noted that the strategy of buying farmland in other countries with the expectation of having that food available in times of crisis is risky. Cargill's Conway agrees. Blas continues:

"Mr Conway warned that host countries were likely to impose export bans in the event of a local or global food crisis. In a rare interview, he said food security had become a key global challenge. 'It is a high, high political item,' said Mr Conway, who is in charge of Cargill’s food security initiatives. 'Food security, which was not on the agenda of anyone but agriculture ministries only three years ago, is now very central to governments,' he said, noting that the interest was at its highest level since late 1970s or early 1980s. ... Archer Daniel Midlands, Bunge, Cargill and Louis Dreyfus – the world’s top food trading houses – are at the centre of agricultural trade and their wide business and government relationships allow them to see changes in food policy. 'The whole world had got very relaxed about food security and, yes, probably unduly complacent,' Mr Conway said. He warned that rising populations and wealth in developing countries and governments’ targets for biofuel production were likely to continue to put upward pressure on food prices for years to come. Mr Conway said the world’s food security would be improved if countries reached a deal on the Doha trade round."

As an executive of the world’s largest trader of agricultural commodities, one would naturally expect Conway to be a proponent of a robust global agricultural trade. Even though his point of view may be biased, his arguments are sound. Global food security cannot be achieved without a robust global agricultural trade. If the FAO is correct, that trade will be a good one to be involved in over the next 40 years. "The Food and Agriculture Organisation forecasts that global trade of food staples will surge to 300m tonnes by 2050, up from the current 135m tonnes." Cargill executives are not the only individuals sounding a warning about the rhetoric and realities of self-sufficiency. In another Financial Times' article, Gideon Rachman discusses some of the negative policies that can arise when self-sufficiency becomes national policy ["When nations turn into hoarders," 26 January 2010]. He begins by discussing the current global state of affairs:

"During the second world war, Britain’s food supplies were threatened by German U-boats and the government responded with posters, urging the public to 'dig for victory', by growing vegetables. You might assume that such concerns were consigned to history. But apparently not. The issue of national food security is back on the agenda. Earlier this month, Hilary Benn, Britain’s minister for food and rural affairs, gave a speech in which he argued that 'the truth is now apparent ... We cannot take food security for granted any more. Food security is as important to this country’s well-being as energy security'. With energy, even more than with food, the British are beginning to question their reliance on purchasing supplies on the open, world markets. This month, supplies of natural gas ran so low that almost 100 large industrial users were temporarily cut off. This is no mere national eccentricity. On the contrary, the fact that even the free-trading British are worrying about food and energy supplies is indicative of a much broader global trend. Across the world, the major powers are moving to secure access to energy, food and, in some cases, water. Faith in a trade-based system of globalisation – in which nations can always buy what they need on the open, world markets – is giving ground to an effort by individual nations to secure supplies. Like survivalists, hoarding tinned food in the basement, individual nations are preparing for the worst. Chinese state-owned oil companies are engaging in ferocious bidding wars with western energy companies as they go after access to the same oil and gas fields, particularly in Africa. The pursuit of 'energy independence' has become a bipartisan dream in the US, leading to a big increase in the production of biofuels made from grain which, perversely, has helped to tighten food prices. Middle Eastern investors, in particular the Saudis and the Gulf Arabs, have been leasing huge tracts of land in Africa, in an effort to grow food that is reserved for their own nations. In Europe, supporters of the protectionist Common Agricultural Policy are freshly emboldened. This new global paranoia about food and energy security is driven by four factors: economics, demography, the environment and geopolitics."

I've discussed all of those factors in past posts. The fact remains that money is moving east, the global population continues to grow, climate change will destroy some agricultural sectors, and, as Rachman notes, the global supply chain could be disrupted. On this later point, he writes:

"Worrying about sea lanes in the age of the internet sounds anachronistic. But the globalised trading system still relies on moving huge amounts of food and energy around the world by ship – and there are at least three choke-points that look vulnerable to disruption. The one that is getting all the attention at the moment is the Gulf of Aden, just south of the Suez canal, where a large multinational flotilla is fighting the threat from Somali pirates. The Strait of Hormuz, through which most Gulf oil needs to pass, could easily be blocked in the event of a conflict with Iran. Meanwhile, the Chinese government has fretted publicly about its 'Malacca dilemma' – the fact that most of China’s imported oil from the Middle East has to pass through the Malacca strait, a narrow waterway between Indonesia and Malaysia. China is uncomfortably aware that it is ultimately reliant on the American navy to keep these vital sea lanes open – a fact that may be driving the Chinese effort to build up its own navy."

Rachman is a bit too dismissive about rising concerns over economics, demography, the environment, and geopolitics, claiming that "most of these concerns will probably turn out to be excessive and paranoid." He believes the real concerns can be found in political overreaction. He explains:

"The trouble with energy and food scares is that they risk creating a self-fulfilling prophecy. If countries embrace protectionist food policies, then destabilising price surges are more likely. Aggressive action by one major power to secure energy supplies is liable to set off alarm bells elsewhere. What is ultimately at risk is the system of globalised trade and open markets that the world has got used to over the last 30 years. That is an idea for world leaders to chew over."

I agree with Rachman that a return to protectionist policies could be devastating for a global economy that is just starting to pick itself up from its knees. There is a saner middle ground between full-on globalization and outright hoarding; and I suspect it will alleviate many of the current concerns. That middle ground will be an increase of regionalization within globalization. Such a course makes sense because it shortens supply lines (and transportation costs), encourages better relations between neighbors, fosters sensible economic clusters, yet maintains the connectivity necessary for the global economy expand. Of course, not everything can be regionalized. There are some products and natural resources that will continue move globally -- oil being one of them. Food, however, is one of the sectors that will likely see an increase in regionalization. There will continue to be seasonal global shipments of food because consumers in wealthy countries will continue to insist on variety year around; but, since regional tastes in food vary, it makes sense that foods enjoyed by regional populations be grown closer to where they are consumed. What need to be avoided are protectionist policies that could disrupt current or emerging trading patterns. Such policies create lose-lose situations at a time when win-win scenarios are desperately needed.

Changing Business Models in the Energy Sector

There remain a number of ongoing debates about achieving energy security in the United States and most of those debates surround oil. I constantly remind people that development depends on generating electricity -- and power generation has little to do with oil. Oil is primarily used in the transportation sector. Other fossil fuels (i.e., primarily coal and natural gas) do play a major role in the generation of electricity and will for decades to come. Last April, James R. Schlesinger, America's first secretary of energy, and Robert L. Hirsch, a senior energy adviser at Management Information Services Inc., reminded Americans that, despite all of the talk about renewable and alternative energy sources, fossil fuels would remain America's principal fuel sources for generating electrical power ["Getting Real on Wind and Solar," Washington Post, 24 April 2009]. They wrote:

"Why are we ignoring things we know? We know that the sun doesn't always shine and that the wind doesn't always blow. That means that solar cells and wind energy systems don't always provide electric power. ... Solar cells and wind turbines are appealing because they are 'renewables' with promising implications and because they emit no carbon dioxide during operation, which is certainly a plus. But because both are intermittent electric power generators, they cannot produce electricity 'on demand,' something that the public requires."

Although Schlesinger and Hirsch are appealing to the sensitivities of the consumer, reliable, on-demand power is even more important for businesses and industries than it is for average citizens. They continue:

"If large-scale electric energy storage were viable, solar and wind intermittency would be less of a problem. However, large-scale electric energy storage is possible only in the few locations where there are hydroelectric dams. But when we use hydroelectric dams for electric energy storage, we reduce their electric power output, which would otherwise have been used by consumers. In other words, we suffer a loss to gain power on demand from wind and solar. At locations without such hydroelectric dams, which is most places, solar and wind electricity systems must be backed up 100 percent by other forms of generation to ensure against blackouts. In today's world, that backup power can only come from fossil fuels."

Schlesinger and Hirsch continue their op-ed piece using strictly economic arguments -- the same basic arguments being used by the coal industry to stir up public support. They write:

"Because of this need for full fossil fuel backup, the public will pay a large premium for solar and wind -- paying once for the solar and wind system (made financially feasible through substantial subsidies) and again for the fossil fuel system, which must be kept running at a low level at all times to be able to quickly ramp up in cases of sudden declines in sunshine and wind. Thus, the total cost of such a system includes the cost of the solar and wind machines, their subsidies, and the cost of the full backup power system running in 'spinning reserve.' Finally, since solar and wind conditions are most favorable in the Southwest and the center of the country, costly transmission lines will be needed to move that lower-cost solar and wind energy to population centers on the coasts. There must be considerable redundancy in those new transmission lines to guard against damage due to natural disasters and terrorism, leading to considerable additional costs."

Eventually they do discuss environmental issues, but only to convince readers that renewable energy sources don't achieve all of the benefits that their proponents normally tout.

"The climate change benefits that accrue from solar and wind power with 100 percent fossil fuel backup are associated with the fossil fuels not used at the standby power plants. Because solar and wind have the capacity to deliver only 30 to 40 percent of their full power ratings in even the best locations, they provide a carbon dioxide reduction of less than 30 to 40 percent, considering the fossil fuels needed for the 'spinning reserve.' That's far less than the 100 percent that many people believe, and it all comes with a high cost premium."

So exactly what point are Schlesinger and Hirsch trying to make? It seems like they are trying to convince the public to abandon programs that promote renewable and alternative energy. Although their arguments lead in that direction, they stop well short of that conclusion. Instead, they conclude:

"The United States will need an array of electric power production options to meet its needs in the years ahead. Solar and wind will have their places, as will other renewables. Realistically, however, solar and wind will probably only provide a modest percentage of future U.S. power. Some serious realism in energy planning is needed, preferably from analysts who are not backing one horse or another."

I think most reasonable people could agree that an array of electric production options should be pursued (along with a vigorous research program focused on reducing emissions that can harm both the environment and health). David Crane, who, as president and chief executive of NRG Energy, a Princeton, N.J.-based wholesale power producer that owns and operates numerous generation facilities, including wind and nuclear, and is developing solar power, is one of the people who is "backing one horse or another." In an op-ed piece, he offers his solution to America's energy conundrum ["An Energy Plan We Can Start Now," Washington Post, 25 August 2009]. As one might expect, he focuses less on economics and more on "energy security" than Schlesinger and Hirsch. His intention, no doubt, is to stir people's emotions about "big oil" and Arab suppliers. Why do I think that? Because he writes, "If we are to focus on these types of God-given energy sources, we need to go to our energy rather than have our energy come to us, as we do with fossil fuels." But as I noted above, oil is about transportation not electrical power generation. If the greatest concern the U.S. has is energy self-sufficiency, Crane should be touting the use of coal -- which the U.S. has in abundance. Instead, he notes that "in recent years there has been a tectonic shift in our energy usage as our country trends away from fossil fuels in favor of 'natural' energy, such as wind and solar." What a surprise -- the very sectors his in which his company is involved. To be fair, however, Crane does eventually discuss the importance of coal.

One thing that Crane, Schlesinger and Hirsch do agree on is that Americans want reliable and affordable power. Another thing they agree on is that sources of renewable energy vary depending on the region of the country involved. In fact, Crane's recommended energy strategy is broken down by region and provides five goals, which are:

• The West gets the sun. Al Gore's vision of a Sonora Desert covered in a 90-square-mile sea of solar thermal mirrors powering the entire country is admirably visionary, but transmission constraints would make this more practical, at least in the near term, at the regional level. So let's set aside an area and get started. California provides sufficient scale; its peak electricity demand is coincident with sunlight, and it is only 250 miles from the Sonora Desert into the heart of the Southern California population center.
• The Midwest gets the wind. Wind is the predominant renewable in the United States today, but for it to be a major factor in the energy mix of the future we need to tap into the wind resources of the upper Great Plains states, which are currently stranded. To date, the focus has been on getting wind resources from places like southeastern Wyoming to California. Instead, let's take wind from the Dakotas and feed it into Chicago. It is 1,100 miles from Cheyenne, Wyo., to Los Angeles, but only 600 miles from South Dakota to Chicago.
• The South gets nuclear. Democratic policymakers have focused like lasers on wind, solar and efficiency. They need to recognize that the South, still one of the nation's most economically dynamic growth areas, lacks suitable wind and solar resources. The geology of much of the Southeast is not well-suited to sequestering the carbon emissions that must be captured by truly 'clean coal.' On the other hand, the populace of the South (and that includes Texas) is generally comfortable with nuclear power, and its incumbent utilities are deeply experienced in nuclear operations. Nuclear energy should be the 'renewable of the South.'
• The Northeast gets the electric car. The Northeast generally lacks good onshore wind and sun power options, as well as public acceptance for nuclear plants. So let's exploit its singular competitive advantage relative to the rest of the country -- the proximity of its population centers to each other. An electric car with a 250-mile range wouldn't make it from Los Angeles to San Francisco, but it would make it from New York to Boston. For real progress, we need to build an infrastructure for the electric car in a few parts of the country. Let the Northeast be a lead 'test' region.
• Pursue 'clean coal' as a national priority. We must set as a national priority -- perhaps a 'national project' -- the demonstration and large-scale deployment of 'clean coal.' All of the zero-carbon regional solutions described above, if forcefully implemented, could have a meaningful impact on U.S. carbon emissions, but only 'clean coal' can actually capture the enormous carbon emissions from the new coal plants coming on line in China and India. It comes down to a mathematical certainty: We cannot solve global warming through clean coal alone; but without clean coal, we simply cannot solve global warming.

Crane must have struggled to find something for the northeast, since electric cars have nothing to do with power generation. In fact, they are part of the challenge that lies ahead since they can add significant stress to the grid. One of the challenges faced by any energy plan is getting the public on board. Although everyone wants reliable and affordable energy, it seems that no one wants the facilities that produce that electricity next door to them -- even projects that are environmentally friendly ["Renewable Energy, Meet the New Nimbys," by Jeffrey Ball, Wall Street Journal, 4 September 2009]. Ball reports:

"Environmentally friendly energy projects are running into the same cries of 'not in my backyard' that stymied a previous generation of alternative-power efforts. Even as Americans tell pollsters they are eager for alternatives to fossil fuel, some are fighting proposals for solar and wind projects and for the thousands of miles of transmission lines that would be needed to carry the cleaner energy to market. The protests echo grass-roots opposition that has blocked nuclear plants and energy-producing trash incinerators for decades."

Since building new facilities, be they coal-fired power plants or wind farms, is becoming more difficult, utility companies are trying new business tactics make a profit ["Rewiring the Utility Business," by John Carey, BusinessWeek, 1 October 2009]. Carey reports on an interview he had with Peter A. Darbee, CEO of Pacific Gas and Electric (PG&E). He writes:

"Peter A. Darbee ... is helping his customers buy less of his product. 'When I tell big customers we would be happy if we sold them less electricity, they look at me like I’ve burned out a few brain cells,' says Darbee. But the logic is inescapable. 'You are not making a lot of money anymore building large power plants,' says Jon Wellinghoff, chairman of the Federal Energy Regulatory Commission. 'You have to figure out what business you are in, big time.'"

Figuring out new business models for the energy sector is becoming almost as important as generating and transmitting power. Carey continues:

"How can utilities make more by selling less? Instead of spending $2 billion on a new 1,000-megawatt power plant, it can use the money to insulate homes, pay customers to install more efficient equipment, and make the grid smarter. Those steps would slash power consumption, eliminating the need for the power plant. The CEO would then ask the state public utility commission to raise electricity rates enough to pay for the $2 billion investment—plus a negotiated profit—just as he would for a new power plant. If the commission agrees, the utility gets revenue from its investment."

Sounds great for the utility company, but why should consumers help utility companies raise their rates? Carey explains:

"Even though the price of electricity will be higher, customers who comply will be using much less power—and those who don’t will effectively subsidize those who do. 'Energy-efficiency programs cost electricity customers less than half what they pay to help fund a new power project,' explains Darbee. Boosting efficiency also reduces greenhouse gas emissions, which will provide another monetary gain for utilities if the nation puts a price on such emissions."

California is not the only state helping utility companies become meaner and leaner. Carey indicates that "other states are taking similar steps."

"'This is where we will make our money in the future,' says James E. Rogers, CEO of Duke Energy. 'The business model fundamentally changes in the 21st century.' Success isn’t a sure bet. 'Some regulators have not yet understood and embraced this,' says Darbee. ... What’s more, the same innovations that produce efficiency gains also bring competition. A number of companies have sprung up to work directly with customers to save energy, snaring the profits that come from efficiencies. And utilities will face rivals on the power generation side as entrepreneurs develop solar, wind, or other sources for homes and businesses that may be as common as refrigerators. ... As a result of these pressures, many companies will suffer the fate of the dinosaurs, says industry consultant Roger W. Gale. David Crane, CEO of NRG Energy in Princeton, N.J., acknowledges the threat: 'If we are not doing things completely differently by 2030, we will be in a world of hurt,' he says."

As Carey notes, the competition for traditional utility companies is changing. A good example is a company called SolarCity ["Little Green Dynamos," BusinessWeek, 27 July 2009 print issue]. Instead of requiring homeowners to buy $30,000 whole-house solar panel systems up front, the company leases systems on long-term contracts. To demonstrate what the company does, the article tells the story of a suburban Glendale, CA, couple named Budwig:

"After the Budwigs put $1,000 down, the three-year-old startup installed panels on their modest ranch home that meet almost all the family's electricity needs. SolarCity also took care of the many complexities that make going solar such a hassle. The company designed and purchased the system and lined up building permits, financing, and government tax breaks. In return, the Budwigs agreed to lease the system for 15 years at $73 a month--$95 a month less than they pay, on average, for conventional power. They expect to recoup their $1,000 investment in less than a year. Since 2006, SolarCity says, it has struck similar deals with 3,500 homeowners, businesses, and schools in California, Arizona, and Oregon. The goal, says CEO Lyndon Rive, is 'to create a multibillion-dollar company in clean power.'"

SolarCity is but one of the new companies offering new business models in the energy sector. Another company with a new business model is BioFuelBox:

"BioFuelBox of San Jose ... is betting on an innovative business model. It collects waste from facilities such as meatpacking plants and sewage processors, converts it to biodiesel, and then sells the fuel. The company wasn't the first to figure out how to cook waste into useful stuff. But BioFuelBox realized the true value lay not in selling disposal systems to customers but in saving them money by taking their refuse for free. So it developed compact refineries that can be loaded onto flatbed trucks and sent to waste sites. Even if the government eliminates subsidies for biodiesel, the company says it can profitably sell its fuel for the same price truckers pay for oil-based diesel. Its first refinery is in Idaho, converting waste from potato processing plants. Given that the world produces 12 billion gallons a year of suitable waste that can be turned into diesel, CEO Steven Perricone hopes to 'run a large network of microrefineries worldwide in three or five years.'"

According to the article, there has been "a burst of innovation that could rival the info-tech revolution." It goes on to assert that "global demand for alternative energy is spawning a broad and bewildering array of tiny companies with big ambitions. Many are now hitting the market with products and services--in the thick of the worst U.S. recession in decades." The article continues:

"Some of the outfits, such as Southwest Windpower, Solyndra, and Clean Current Power Systems, are chipping away at the technological obstacles that have made alternative energy systems--wind, solar, and hydro power--too costly. Others, such as SolarCity, are reinventing the business model behind alternative power. Still others, including SmartSynch, Verdiem, and Fat Spaniel Technologies, are harnessing the Internet to help utilities remotely manage the energy consumption of their customers' PCs, office air conditioners, and factory lights. In addition we've identified a handful of manufacturers selling gizmos that help slash power usage, from Bridgelux--which makes low-cost solid-state lighting--to GridPoint, whose smart meters can track every electric appliance in your home."

Clearly, the energy sector is changing in dramatic ways. I side with Schlesinger and Hirsch, however, whenever it comes to facing reality. We can't ignore the things we know even as we search for better ways forward. I also know that we shouldn't sacrifice the future for the present -- something politicians and consumers demonstrate they are willing to do on a daily basis. That's why I agree with Crane, Schlesinger and Hirsch that a number of different solutions need to be pursued.

Education and Training: Enabling the Developing World's Future

In yesterday's post entitled The Future Belongs to the Young, I promised to write a post about a series of articles published in the Financial Times about what is being done to help the world's youth prepare for the future. The focus of the yesterday's post was the important role that education plays in preparing today's youth to become responsible citizens. A concomitant benefit of education is that it can displace despair with hope and give young people a stake in the future. Education and training are also featured in the articles that are the focus of this post. The first article deals with a college in Ghana ["New college sets high standards to mould Africa’s future leaders," by Sarah Murray, 29 January 2010]. Murray writes:

"Some say that the most powerful way to change the world is to educate its future leaders. This is certainly the view of Patrick Awuah, founder and president of Ghana’s Ashesi University. While working as a software engineer for Microsoft in Seattle, Mr Awuah had been looking for a way to contribute to nation-building efforts both in his home country, Ghana, and more broadly across Africa. 'Drilling down, I came to leadership,' he says. 'And if you look at who is at the African universities, those are the people who are going to be running this continent,' says Mr Awuah, who was educated in the US at Swarthmore College. Yet when he surveyed the higher education landscape across Africa, Mr Awuah was dismayed by what he saw. For a start, he says, only 5 per cent of school leavers were going on to college. Because the number of young people embarking on higher education is so small, he says, these are by definition the future leaders – and not just politicians but also the lawyers, doctors, bankers, chief executives and teachers essential to shaping society and managing an economy."

I'm pleased that when Murray defined what she meant by "leaders" she didn't start and stop with politicians. Although political leaders are critical for making or breaking a country (it has been corrupt national leaders, for example, who have squandered the natural resources of many African countries leaving a legacy of distrust, disillusionment, and poverty), leaders in other societal sectors (i.e., education, finance, business, etc.) will make the biggest difference when it comes to improving the lives of ordinary citizens. Mr. Awuah would like to see corrupt leaders replaced by educated and ethical ones. Murray continues:

"[Throughout Africa] most young people, he says, are receiving their education from institutions where classes are overcrowded, where learning by rote is the main form of instruction and cheating is the norm. To start to change this, Mr Awuah decided to create a liberal arts college that would educate students to be ethical and entrepreneurial leaders."

Followers of this blog know that I'm proponent of entrepreneurs and of activities that foster the creation of businesses and jobs. In the long run, I suspect that the entrepreneurs will play a more important role in Africa than the politicians when it comes to economic development. Murray reports that Awuah didn't blindly jump into the education business. She continues:

"First, ... he decided to educate himself – with business and management skills. He embarked on a two-year MBA programme at the University of California’s Haas School of Business, a course he says was probably 'the single most important investment' he made in the Ashesi University project. After a 1998 trip to Ghana with business school colleagues to conduct a feasibility study into the possibility of setting up a university in Accra, the capital, he returned to Seattle and set up a foundation, investing his own money as well as donations from colleagues and from Microsoft. He decided against a for-profit model. 'It soon became clear that if we wanted to achieve a certain quality, we wouldn’t have sufficient returns to attract investors and venture capitalists,' he explains. 'And it wasn’t clear what the exit scenarios were – you don’t start a school and sell it to an investor or do an IPO. So for an adventure like this, the non-profit model seemed better.' But while half the students are on financial aid and fundraising remains essential for expansion, the school is financially self-sustaining, with tuition fees largely covering operating costs."

Although the establishment of a university is a significant achievement by itself, a university can only become great by adhering to high standards. That is a goal that Awuah wanted to reach and maintain.

"As well as pushing for high academic standards, fostering a culture of ethics is a central mission of the school. If caught cheating, students fail the course. Anyone found cheating a second time is expelled. ... Students sign up to an honour code – one voted into force by the students themselves in 2008 – that requires them to report instances of academic misconduct. Moreover, all students embark on community service before they graduate. With a liberal arts core and majors in business administration, computer science and management information systems, the emphasis is on teaching young people to think entrepreneurially and ethically, as well as on equipping them to analyse problems and come up with solutions."

How's the university doing?

"After starting its first year with 30 students, Ashesi University’s enrolment has now reached more than 400. With the help of a $2.5m investment from the International Finance Corporation, the investment arm of the World Bank, a new campus will open next year, accommodating many more students. Most importantly, perhaps, more than 95 per cent of graduates from the school have remained in Africa, generating a fresh supply of the young, entrepreneurial, ethical individuals that African political, social and business institutions so badly need."

The impact that those few students will have on their countries remains to be seen. Mr. Awuah isn't trying to predict the future; he is trying to enable it. Not everyone, however, is a good fit for a college education nor do all college students graduate with employable skills. For them, training provides a better (or supplemental) path to future prosperity. In that area, too, advancements are being made ["Training helps develop key skills for work," by Rowenna Davis, 29 January 2010]. Davis reports:

"Companies have two big incentives to tap into and invest in young labour supplies – the need to replenish their work-forces, and the desire to further their reputations. In some of the poorest areas of the globe, this enlightened self-interest is guiding economic and social development for the next generation. Take Samsung Electronics’ work in Africa, for example. The South Korean company’s Real Dreams programme has offered employability skills to more than 4,000 young people aged predominantly between 18 and 30 since it started in 2008, offering courses in South Africa, Kenya, Nigeria and Egypt. Jung Wook Ko, marketing manager for the Middle East and Africa, says the programme has complemented the company’s expansion on the continent. 'Our resources are not enough in Africa – we need more local people to help us,' he says. 'In developed countries we can easily find talented people, but in developing countries it’s more difficult to find good candidates. If we can tell our retailers and distributors and technicians that they can hire more from our youth programme, it’s a win-win situation.'"

One of the gripes about Chinese companies as they have moved into Africa is that they have brought with them large contingencies of Chinese workers. Samsung's approach is much better received. Wisely, Samsung hasn't used a cookie cutter approach but has varied the program to accommodate "local capacities."

"The more advanced programmes in Nigeria and Egypt help qualified university students find a job after graduation by furthering their IT skills. In Kenya, for example, Samsung is working with the digital design school NairoBits to offer unemployed youth advanced web design skills, enabling some to find jobs in the country’s top design agencies and government departments. At the other end of the scale, young uneducated slum dwellers in South Africa are given basic maintenance and repair skills. Samsung employs only a tiny percentage of the young people on its courses, but Mr Ko still says there is a business case for investing in them: 'These programmes have the side-effect of familiarity with the brand.' Other companies are keen to participate. Mr Ko says that Samsung is in discussion with Microsoft about how they might support each other, with Samsung providing hard training facilities and Microsoft providing the software. A huge number of other multinationals is offering similar opportunities for young people. Wrigley’s Youth Empowerment Success programme (Yes) has invested $2.5m in a variety of business training schemes that have reached some 1,800 students across five target countries – India, the Philippines, Poland, Russia and Spain. This year it is expanding the programme with the aim of helping 15,000 young people across the globe."

As noted in my earlier post, World Bank staffers assert that "even before the financial crisis struck, developing countries needed to create 1bn jobs over the next decade just to keep up with a new wave of first-time job seekers." Each of those workers needs employable skills. That means the need for jobs is matched by the need for training. Davis continues:

"Although the challenges of youth unemployment vary massively across the globe, employers consistently say that young people – even those that receive higher education – lack important employability skills. ... But if companies’ investments in young people are going to pay off, the conditions have to be right. As Emmanuel Jimenez, director of human development for the East Asia region of the World Bank, explains: 'In some countries it may be hard to hire and fire workers, or high minimum wages may prevent companies from hiring young, less experienced workers. The state must not bias against young people."

Davis also raises a challenge that too many discussions about higher education fail to mention: unwarranted expectations. She explains:

"'Expectations may also cause problems. In some countries, including some in the Middle East, people who have had a year or two of post-secondary education think they deserve a white collar job – they’d rather wait for a government position than take the first one that comes along.' Furthermore, says Mr Jimenez, even if businesses do have an incentive to invest in the next generation, society may benefit from putting in more. 'It may be that it’s better to employ young people because that’s the time in their lives where they are capable of learning the most,' he says. 'If we don’t employ them, that benefit is permanently lost to young people and society as a whole. Firms may need some encouragement to invest the right amount.'"

National needs and education/training need to be carefully matched so that the hope and opportunities that should be provided by such programs isn't replaced by disillusionment and despair. In past posts, I have repeatedly touted the benefits of national economies being connected with the global economy. In the information age, that means connecting to the World Wide Web. The first thing that requires, of course, is infrastructure. Once the bandwidth and connectivity is in place, however, there is a rising need for individuals who know how to exploit emerging opportunities. Fortunately, programs are also in place that are addressing the challenge of the so-called digital divide ["Better access can level the playing field," by George Cole, 29 January 2010]. Cole reports:

"In many developed countries, technologies such as mobile phones, computers and the internet are routinely used by young people in education and employment. Most young people are enthusiastic about technology and the benefits it can bring. 'Young people have a natural ability to use technology, regardless of their qualifications, knowledge, education or location. It doesn’t matter if a child is in California or the slums of Nairobi,' says Akhtar Badshah, senior director of community affairs at Microsoft. The power of technology to create opportunities and unleash potential cannot be overestimated, so a number of corporate-supported programmes and initiatives have been established to give young people in developing countries greater access to technologies such as video and IT."

Like Samsung, in the article discussed above, Microsoft is not being completely altruistic with its programs. The more people that become IT users, the more opportunities Microsoft has to sell its products -- and emerging markets offer the greatest opportunities for growth; and the best place to start in emerging markets is with the young.

"Microsoft and the International Youth Foundation (IYF) have formed a two-year partnership called the Youth Empowerment Program (YEP). This aims to improve the employability of disadvantaged people aged 16 to 35 in sub-Saharan Africa, where youth employment stands at 21 per cent – the second highest rate in the world. Microsoft has provided a $1m grant and IYF works with local partner organisations in Kenya, Nigeria, Senegal and Tanzania. YEP aims to reach 40,000 individuals, with 10,000 young people directly benefiting from technology and training . In Kenya, for example, IYF and three NGO partners are providing ICT, life skills, entrepreneurship training and other support to 2,600 young people based in settlements around Nairobi."

Once again the word "entrepreneurship" is brought into the conversation. It's hard to discuss a brighter future and not talk about entrepreneurs at the same time. Dell and other organizations are also involved in IT training programs.

"Dell YouthConnect is a global programme that aims to support education and digital inclusion for underserved youth. The programme has provided more than $8m and has been launched in eight countries including Brazil, China, India, Morocco and France. The latest Dell YouthConnect programme was in collaboration with Unicef and supports the Children’s Forum for Climate Change. Dell YouthConnect has provided 160 lap-tops to enable young people to participate in the debate on climate change. RM, the UK-based education technology company, sponsors two government schools in Kerala, southern India. It has not rushed to provide the schools with IT, although its long-term strategy is to do this. ... In September 2007, IYF and the Tanzania Ministry of Education and Vocational Training launched Bridgeit (known locally as Elimu kwa Teknolojia or Education through Technology). Other project partners are Nokia, Nokia Siemens Networks, Instituto Nolia de Tecnologia (INdT) and the Pearson and Vodacom foundations. The aim of Bridgeit is to provide schools with videos that can support science, maths and life skills teaching, and to improve the quality of interaction between teacher and student. Bridgeit has received almost $3m funding from the US Agency for International Development (USAid). Some 150 public (state) schools are involved in Bridgeit, representing more than 40,000 students with an average age of 13."

Another article asserts that that young people can help themselves enable a better future and that many of them are ["Putting the public good ahead of profits," by Rowenna Davis, 29 January 2010]. Davis reports:

"Fredrick Ouko Alucheli is disabled. He uses two elbow crutches to support his weight and a caliper for walking. He grew up in West Kenya and both his parents are peasants. But the defining feature of Mr Alucheli is his job – the head of Action Network for the Disabled (Andy), the organisation he founded when he was 20. ... After his parents made sacrifices to give Mr Alucheli an education, he was able to apply for the grants he needed to start Andy (formerly known as Kenya Disabled Action Network), which now offers a range of programmes for disabled young people including training, work placements, sporting opportunities and human rights education. In the seven years since its foundation, Andy has helped more than 1,000 young people. Mr Alucheli is not alone. He is one of thousands of young 'social entrepreneurs' – innovative pioneers who find creative solutions to social problems. They only differ from regular entrepreneurs in that the public good rather than profit drives their activities. These imaginative pioneers are pushing the boundaries of development in nations across the globe."

Davis goes on to describe some of the social challenges being addressed by young social entrepreneurs:

"In the UK, four Cambridge PhD students have founded JustMilk, an organisation that is developing a device that would filter the HIV virus out of breast milk. In the Philippines, a group of young people has founded Rags2Riches, an enterprise that empowers women living on a sprawling dumpsite to make high quality handbags out of recycled cloth. In the US, graduates have started Husk Power, which uses discarded rice husks to deliver power to off-grid villages in rural India. In Brazil, low-income women are transforming discarded commercial waste into furniture and works of art for sale, as part of Evamaria, a youth-led social enterprise programme."

Social entrepreneurism is a recent phenomenon that has attracted both young and old alike. To learn more, read my posts entitled The Rise of the Social Entrepreneur and Global Social Entrepreneurs. Young social entrepreneurs, however, are on the rise. Davis continues:

"According to Paul Hudnut, an instructor in social entrepreneurship at Colorado State University College of Business, such initiatives are set to solve some of the world’s main development challenges. 'Society now has a number of big institutions and businesses that aren’t functioning well,' he says. 'They have their roots in petroleum, and times are changing. India and China are rising. The demand for development is growing. The Fortune 1,000 companies aren’t going to change these things. I have more faith in young people to come up with ground-breaking solutions.' Most experts in the field agree that young people often make the best social entrepreneurs. They are willing to fail, more prepared to travel and less likely to be tied to a family. But most importantly, they think outside the box."

Often the difference between young social entrepreneurs and older ones is funding. Many older entrepreneurs made their mark in business and go looking for ways to use their fortunes to benefit others. Younger entrepreneurs generally start with little or nothing. Davis explains the challenges they face and how new funding sources like the Acumen Fund can help (for more the Acumen Fund, read my blog entitled Philanthropy and Development in Emerging Markets):

"While some ventures take very few resources to get off the ground ... most social entrepreneurs find funding a serious obstacle. This is one of the vital areas in which the Acumen Fund can provide support. Relying almost entirely on voluntary donations, Acumen uses a range of debt and equity measures to help the most promising fledgling projects get going. ... Acumen is currently funding 26 projects in Africa, India and Pakistan that reach more than 26m people. Its network of experienced social entrepreneurs means that young pioneers can seek advice before things go wrong. Mr Dellane says project defaults are rare. But youth entrepreneurs also need an amenable economic context if they are to thrive. Bureaucracy, complicated funding applications and red tape are more likely to put young people off than other groups, and the adults that hold the keys are often sceptical of their initiatives, when support is what young social entrepreneurs need."

Mark Strand, a professor of English at Columbia University and a Pulitzer Prize winner, wrote, "The future is always beginning now." That means that "now" is the time to work to ensure that a brighter future awaits the next generation. In a final article, Sarah Murray claims that helping young people become entrepreneurs is way to keep the doors to the future open ["Future hinges on keeping doors open," 29 January 2010]. Murray concludes:

"Enterprise can provide a long-term route out of poverty for many unemployed young people. This is the conclusion of Youth Business International, a UK-based non-profit organisation that champions youth enterprise. In the first of a series of reports on entrepreneurship, YBI sets out steps that governments, businesses and civil society groups can take to foster entrepreneurship among young people. ... Halving youth unemployment could, according to some estimates, add up to $3,500bn to the world economy. The gains of such a reduction in youth unemployment could be substantial, particularly in sub-Saharan Africa, where the ILO estimates it would generate a rise of 12 to 19 per cent in gross domestic product. ... Although not everyone is equipped or motivated to become an entrepreneur, many young people can create jobs that generate employment. In the US, says YBI, micro-enterprises create jobs at an average annual rate of 900,000 a year. ... But whether they are seeking employment or starting their own businesses, young people also need access to education and healthcare. ... Empowered by education and technology, young people have the potential to become employers, educators, advocates and 'changemakers' – a term coined by Ashoka, the social entrepreneurship organisation."

Murray describes several initiatives that "show how young people can help solve global problems by finding novel ways to address issues such as poverty and lack of access to healthcare and education." Despite the daunting numbers (i.e., about half the world's population is under 25 and 400 million jobs need to be created for them right now), the overall impression left by the Financial Times' articles is one of optimism. We need to get youth involved in creating their own future. Although we can help enable a brighter future for today's young people, we can't simply hand one over to them. The way that countries are piling up sovereign debt, political leaders must think that the future is bright and that their youth will succeed -- because they are expecting generations to come to pay for past mistakes. That fact alone should motivate leaders everywhere to get involved helping youth help themselves. The future does belong to the young.

The Future Belongs to the Young

Antoine de Saint-Exupery (1900-1944), whose most famous work was The Little Prince, once wrote: "As for the future, your task is not to foresee it, but to enable it." Enable it for whom? The answer, of course, is for the next generation and those that follow. The next 40 years, however, are especially critical because the global population is expected to increase by nearly 50 percent before it peaks. The Financial Times recently ran a series of articles about today's young people and what we need to do to enable a better future for them. One of the articles notes that "young people in the developing world are coming of age in greater numbers than ever before" ["Seizing opportunity now will make the world fairer and safer," by Justin Yifu Lin and Wendy Cunningham, 29 January 2010]. Lin, who is chief economist and senior vice-president, development economics at the World Bank, and Cunningham, who is coordinator of the World Bank’s Children and Youth Program, assert that a window of opportunity exists that will make or break the future depending on what the world does. They write:

"A recent World Development Report that focused on youth strongly suggested that countries need to seize this window of opportunity to invest. Yet for many young people, the financial crisis has meant even fewer life options and falling spirits. Many are struggling to finish school or find jobs in pursuit of a more promising life. In the best of times, young people are three times more likely to be unemployed than adults. Even before the financial crisis struck, developing countries needed to create 1bn jobs over the next decade just to keep up with a new wave of first-time job seekers. Because of the crisis, job creation is an even more challenging task. As a world community we simply cannot afford to abandon these young people to the ups and downs of the global economy. By nature, they yearn to realise their full potential, earn a living wage, save for marriage, a home, and above all, take their rightful place in society."

One of the problems, Lin and Cunningham insist, is that decision makers, when considering how to help young people, think in terms of the future instead of realizing that the future begins with the here-and-now. They continue:

"Too often we regard our young men and women as the workers, entrepreneurs, parents, citizens and leaders of tomorrow. In fact, they are today’s citizens and we must recognise their potential to make extraordinary changes to the world around us. Addressing young people’s needs and aspirations is vital for both social and economic progress. Either we do nothing – and risk alienating them from the mainstream and instilling in them a legacy of distrust and hopelessness – or we invest in the biggest source of human potential that the world has ever had, and reap the benefits of that investment through greater growth and social well-being for generations to come."

If nothing is done to enable a better future for those coming of age, the Great Recession runs the risk of creating the Great Repression. Lin and Cunningham explain:

"The current crisis poses risks for our collective future. A recent British Council report on the young people of Pakistan predicts a 'demographic disaster' if that country does not address the needs of its young generation. More than 70 per cent of Pakistani youth reported being worse off financially than a year earlier. Pakistan is not alone. World Bank analysis shows that child and youth poverty in some eastern European countries has increased by 5 per cent to 10 per cent over the past year. Across the world, young people’s hopelessness in the face of the crisis is reflected by dropping out of the labour force altogether at three times the rates of adults. Even more troubling is the growing level of despair among youth that reflects disillusionment not only with their governments but with democracy itself."

The terrorist attacks that continue to grab headlines underscore the fact that it is hopelessness and disillusionment, even more than poverty, that drives young people to desperate and despicable actions. Young people need a stake in the future so that they can cling to hope. Lin and Cunningham insist that the depressing data presented above doesn't have to define the future. They write:

"We have seen time and again how countries that invest in their young men and women end up with more economic growth and social cohesion. Governments that encourage their students to stay in school see significant national returns on each additional year of schooling. This is especially true when countries invest in educating their adolescent girls to secondary school level and beyond. Governments and private companies can also finance and expand effective job-training programs which can groom young people for the demands of a global economy that requires more and more highly skilled workers. For example, in the Dominican Republic’s Juventud y Empleo project, comprehensive job-training has bumped up young people’s salaries by as much as 10 per cent. The returns on the investment in the young beneficiaries are expected to exceed the programme costs within two years of their graduation. Such returns are observed across Latin America. The current crisis has spurred governments to work more intensively with the international donor community, NGOs and corporate sponsors to champion new models of youth employment programmes that focus on a more comprehensive market-driven approach – with relevant job and life skills training, internships, and job placement opportunities. The World Bank is mobilising around this issue as well – having joined forces with the Nike Foundation to set up an Adolescent Girls Initiative to pioneer employment projects for girls in Liberia, Rwanda, South Sudan, Afghanistan, and Nepal. The Bank is also preparing three youth development programmes in Kenya, El Salvador, and Papua New Guinea, in addition to others in the Dominican Republic and Honduras, reflecting a sense of urgency and recognition that young people can play a significant role in reducing poverty and spurring economic growth. And the Bank is working in partnership with the International Labour Organisation’s (ILO) Youth Employment Network, with leading NGOs, including the International Youth Foundation and with the overall donor community to develop a body of knowledge on effective youth employment interventions that will succeed even after the crisis has subsided."

New York Times' op-ed columnist Nicholas Kristof reports that one country that has invested in its youth has seen economic benefits as well as something even more precious -- increased happiness ["The Happiest People," 7 January 2010]. That country is Costa Rica. Kristof reports:

"Increased schooling created a more stable society, less prone to the conflicts that have raged elsewhere in Central America. Education also boosted the economy, enabling the country to become a major exporter of computer chips and improving English-language skills so as to attract American eco-tourists. ... In Costa Rica, rising education levels also fostered impressive gender equality so that it ranks higher than the United States in the World Economic Forum gender gap index. This allows Costa Rica to use its female population more productively than is true in most of the region. Likewise, education nurtured improvements in health care, with life expectancy now about the same as in the United States — a bit longer in some data sets, a bit shorter in others."

Kristof notes that Costa Rica is "arguably the happiest nation on earth" and I would argue that happiness is a byproduct of hope. Lin and Cunningham conclude:

"To be sure, it will take time for countries to get back into the global economy, to restore their confidence in trade and investment, in creating jobs, and other measures of economic vitality. But we cannot wait until the crisis ends to pay serious attention to the plight of today’s young people. Consider that they now constitute the largest youth cohort in human history – more than 1bn people between the ages of 15 and 25 – with the vast majority of them growing up in developing countries. Sub-Saharan Africa, according to the US-based Population Reference Bureau, is home to the world’s largest population of young people and is projected to stay this way for decades. If we do nothing to address these issues, the consequences will be severe. According to a recent World Bank study of Latin America and the Caribbean, underinvestment in youth costs countries as much as 2 per cent of their GDP every year, even at the best of times, and the situation is getting worse. As a result, fewer young people will be able to contribute to the economic growth that will help fuel a more widespread, stable global recovery, and more will eventually lose hope in themselves and in a vision for a better world. Now is the time for governments and donors to act. Given their sheer number in a world beset with poverty and its related tribulations, we need to empower young people to take charge of their own lives and discover their full potential. Whether they succeed has everything to do with whether we succeed as a world, and as a society. But they cannot do so alone."

The American humorist Dave Barry once wrote, "I care about our young people, and I wish them great success, because they are our Hope for the Future, and some day, when my generation retires, they will have to pay us trillions of dollars in social security." In addition to the legacy of a large national debt, Americans should provide a legacy of hope by investing in today's youth. The same holds true for other countries as well, especially in the developing world. In a future post, I'll examine some of the other articles published in the Financial Times special report on world's youth.

Precision Agriculture

Benjamin Franklin, one of America's founding fathers, once quipped, "There seem to be but three ways for a nation to acquire wealth. The first is by war, as the Romans did, in plundering their conquered neighbors. This is robbery. The second by commerce, which is generally cheating. The third by agriculture, the only honest way, wherein man receives a real increase of the seed thrown into the ground, in a kind of continual miracle, wrought by the hand of God in his favor, as a reward for his innocent life and his virtuous industry." A generation later another statesman, Daniel Webster, added, "When tillage begins, other arts follow. The farmers, therefore, are the founders of human civilization." Agriculture has come a long ways since the days of Franklin and Webster. They lived in an agrarian society and didn't live to see agriculture enter the industrial age. Agriculture has only recently started to move from the industrial age to information age as art and science of agriculture have come together to change the face of that sector.

Agricultural science first started overtaking the art of farming with the development of fertilizer, hybrid seeds, and genetically-modified plants. One of the leaders in that field was Monsanto, a company that has been labeled both sinner and saint ["The parable of the sower," The Economist, 21 November 2009].

"Few companies excite such extreme emotions as Monsanto. To its critics, the agricultural giant is a corporate hybrid of Victor Frankenstein and Ebenezer Scrooge, using science to create foods that threaten the health of both people and the planet, and intellectual-property laws to squeeze every last penny out of the world’s poor. ... To its admirers, the innovations in seeds pioneered by Monsanto are the world’s best hope of tackling a looming global food crisis. Hugh Grant, the firm’s boss since 2003, says that without the sort of technological breakthroughs Monsanto has achieved the world has no chance of doubling agricultural output by 2050 while using less land and water, as many believe it must. Mr Grant, of course, would say that. But he is not alone. Bill Gates sees Monsanto’s innovations as essential to the agricultural revolution in Africa to which his charitable foundation is committed. Josette Sheeran, the head of the United Nations World Food Programme, is also a fan."

This post, however, is not about Monsanto per se, but about how science and technology are being put to use in the agricultural sector. Monsanto's roots are in the pharmaceuticals and chemicals sector. "The original company was formed in 1901 to make saccharine. In 2000 it merged with Pharmacia & Upjohn, a drugmaker. Two years later the group’s agricultural activities were spun off into a new Monsanto." Although the company still makes products like herbicides (its most famous product is Roundup), "today most of Monsanto’s $11.7 billion of annual sales come from seeds, increasingly of genetically modified (GM), or transgenic, varieties, and from licensing genetic traits." The article continues:

"Indeed, it is now best known, for better or worse, for applying biotechnology to seed production, winning a string of the sort of patents on living organisms that became legal in America only after a Supreme Court decision in 1980. ... In the 13 years since GM seed was first farmed commercially, agriculture—and Monsanto with it—has become increasingly central to several of the world’s most pressing policy debates, says Mr Grant, a Scot who joined the company in 1981. Nowadays he spends a good deal of his time taking part in those debates, which range from concerns about higher prices and shortages of supply to the use of land for growing biofuels rather than food, climate change and water. Arguments over water, thinks Mr Grant, 'will dwarf the discussion that has taken place so far over food.' Monsanto is also getting caught up in the debate over intellectual-property rights in food and their implications for antitrust policy. ... How successful Monsanto and rival makers of GM seed, such as DuPont and Syngenta, are in winning round a sceptical public and policymakers will play a big part in determining how lucrative their innovations prove to be."

As noted above, the world's population is predicted to peak around the year 2050 near the 9 billion mark. That's nearly a 50 percent increase from today's population. Feeding all those people will be a challenge and many analysts believe that only science and technology can find a solution.

"Monsanto’s innovations fall into two categories. The first is breeding, which seedmakers have been doing with increasing sophistication for decades. Monsanto is able to accelerate the process of selective breeding through better mapping of a seed’s genetic qualities and its suitability to grow in a particular place. At Monsanto’s research laboratory in St Louis, the company’s home city, farmers on one of the many tours that are part of its marketing efforts are clearly fascinated by a piece of technology known as the corn chipper. ... In the past three years this technology has helped speed up dramatically Monsanto’s ability to identify and grow the most productive seed for any given location. 'It is the mother and father of all dating agencies: we can analyse every single seed we harvest, do a health check, guess what its grandchildren will be like, send it anywhere in the world,' says Mr Grant."

As climate change continues to alter weather patterns, being able to rapidly match seeds with climate will be an important part of the food security solution. The article continues:

"The second category of innovation, in which Monsanto is becoming increasingly adventurous, is genetic modification: identifying genetic traits with particular qualities and transplanting those traits into seeds to improve their performance. In essence, the goal is to pack as much technology into a seed as possible. The biggest breakthroughs so far have been in weed and bug control. Perhaps the most common feature of Monsanto’s range of seeds is that they are Roundup Ready, meaning that they are guaranteed to survive spraying with Roundup that will take out any surrounding weeds. Some plants have been bioengineered to deter pests from eating their leaves and roots, which reduces or even eliminates the need for insecticides. ... Monsanto has just launched two new varieties of seed that have been engineered to be far more productive: Genuity SmartStax corn, which company trials suggest can increase yields by 5-10%; and Genuity Roundup Ready 2 Yield soyabeans, which in trials have shown yields 7-11% higher than the first generation of Roundup Ready soyabeans. Over the past couple of decades, soyabean yields have risen at an annual rate of barely 1%. In around 2012 or 2013 Monsanto expects to launch a soyabean whose processing will result in fewer transfats. It will also offer an 'omega-3 soyabean', genetically enhanced to give consumers the many proven health benefits of omega-3 fatty acids. ... The company is also aiming to engineer seed to use nitrogen more efficiently—and hence to require less fertiliser. This would reduce farmers’ exposure to the price of oil, from which fertilisers are made, and the damage done when nitrogen leaches into the water supply. In about three years’ time Monsanto expects to launch its first 'drought tolerant' products. It is examining several ways of making plants more tolerant of drought."

In a 2007 post entitled The Coming Water Wars?, I noted that water supplies could drastically change along with the climate. Having the flexibility of growing food crops tailored to changing conditions could help reduce fluctuations in the availability of food. Both too little and too much water can destroy crops; but too little water is predicted to be a much bigger challenge in the future. The article discusses some strategies Monsanto is using to produce drought resistant food crops.

"One is to improve the roots’ take-up of water. Another is to reduce water loss through the leaves. A third is to alter plants’ reaction to lack of water. When stressed, a plant shuts down growth in order to conserve what it has. They often over-react, and use a lot of energy when they restart. Genetic modification can help it interpret water conditions more accurately and avoid unnecessary stops and starts. Because water shortages are predicted for many parts of the world, Monsanto expects these drought-tolerant plants to be a huge commercial success."

The article notes that Monsanto aggressively protects its intellectual property (and, thereby, protects its profits); but the company also works with other organizations in trying to figure out how to feed the world's poor.

"Monsanto is using ... a different approach from that of big drugmakers when it comes to dealing with the millions of poor people in Africa. Mr Grant says that he is determined not to repeat the mistakes of the pharmaceutical industry in holding back on making valuable innovations available to the developing world. He believes that 'in a perfect world, on the same day you launch [a drought-resistant seed] in Kansas, you would launch it similarly in Nairobi'—although in practice Africa and other poor places that are short of water will have to wait a while longer. Over the past three years, the firm has started to play a leading role in efforts collectively described as an attempt to create a 'green revolution in Africa'. Mr Grant talks enthusiastically about his friendship with Norman Borlaug, the driving force behind the Green Revolution, first in Mexico, then in Asia, in the second half of the past century, which is generally reckoned to have saved at least 1 billion lives. Shortly before his death this year, aged 95, Borlaug reportedly expressed regret that he would not live to see the 'gene revolution'. In white corn, a staple in Africa and Mexico, Monsanto has donated all its intellectual property, seed and know-how for developing drought-tolerant genes to Water Efficient Maize for Africa (WEMA), a public-private partnership that has received grants from the Bill & Melinda Gates Foundation and the foundation of Howard Buffett, an Illinois farmer (and son of Warren Buffett). The five countries to benefit are Kenya, Mozambique, South Africa, Tanzania and Uganda. Mr Grant expects to launch drought-tolerant corn in Africa within two or three years of the launch in America. The company is also working with Millennium Villages, an anti-poverty project led by Jeffrey Sachs, an economist at Columbia University."

Although Monsanto will collect no royalties for drought-tolerant corn sold in developing countries, it believes that helping developing countries is good business. As developing countries break loose from poverty's grasp, they will eventually be able to purchase commercial products from Monsanto. In fact, Grant believes that "the developing world will be a huge source of future growth for the firm." Why? The article explains:

"Monsanto sells more GM cotton in India than in America. Already, most of the countries where GM seed is sown are emerging ones. Around 90% of the world’s 12m farmers with at least a hectare planted with GM seed are smallholders in developing countries. America has 250,000-300,000 active farmers; India has 15m cotton farmers alone, several million of whom Monsanto says it has reached already. This reinforces the firm’s fundamental message, that it is a driving force for higher farm productivity—and that higher productivity, not a return to the methods of the past, is likely to be the true source of agricultural sustainability."

Genetically-modified crops are not the only science- and technology-based activities helping increase production and reduce costs. Satellites are also helping farmers boost crop yields ["Harvest moon," The Economist, 7 November 2009 print issue]. The article reports:

"For farmers, working out the optimal amount of seed, fertiliser, pesticide and water to scatter on a field can make, or break, the subsequent harvest. Regular laboratory analyses of soil and plant samples from various parts of the field can help—but such expertise is costly, and often unavailable. A new and cheaper method of doing this analysis, though, is now on offer. Precise prescriptions for growing crops can be obtained quickly, and less expensively, by measuring electromagnetic radiation reflected from farmland. The data are collected by orbiting satellites."

The article notes that utilizing data collected from such analyses can increase yields by as much as 10%. French growers are the leaders in using "precision farming using satellite-based intelligence"; but, precision farming "is in its infancy." The article notes that satellite agricultural data collection "is valuable to governments, too."

"Areas where fertilisers and pesticides are being applied excessively can be pinpointed, studied and regulated by environmental and land-use agencies. Guy Lafond, an agronomist with Agriculture and Agri-Food Canada, a government agency, says satellite data are proving useful for a study of fields with declining productivity in Saskatchewan. Overkill with nitrate fertilisers (which are also a source of greenhouse gases) appears partly responsible. And according to RapidEye, a German satellite operator, insurance companies are also studying satellite data with a view to selling crop-insurance policies to governments of countries that might be threatened by famine."

The article indicates that satellite-collected data can "help forecast harvests" and can assist farmers boost their productivity by allowing them to manage individual fields (or sections of fields) differently. Although use of satellite-collected data sounds expensive, the article indicates that it is affordable even for some developing countries.

"In Africa, where many soils have become badly depleted of nutrients, better fertiliser management would go a long way. As a consequence, the World Agroforestry Centre in Nairobi has begun cataloguing the radiation signature—and thus agricultural potential—of about 100,000 samples of African soils. It is giving this detailed information to the International Centre for Tropical Agriculture, based in Colombia, so that it can build a database called the Digital Soil Map. When ready, this will provide farmers with free forecasts, developed with regularly updated satellite imagery, across farmland in 42 African countries. For a hunger-ravaged continent, that is good news indeed."

The ability to match crops with climate and soil conditions is what makes precision farming a revolutionary step forward ["Rewards of precision farming," by Clive Cookson, Financial Times, 27 January 2010]. Cookson reports:

"The technological battle to raise agricultural productivity while reducing the environmental impact of farming is taking place across a broad front. Genetic engineering of crops receives the most publicity, as much because it is so controversial as because it has the most to offer, but there are many other promising approaches. Precision farming – the use of information technology to monitor crops and guide the application of seeds and agricultural chemicals – is turning individual farmers into expert agronomists. The most straightforward form of precision farming is to use satellite navigation to guide a tractor. When signals from GPS satellites are combined with a farm base station, the tractor can drive itself with an accuracy of 2cm – better than the most skilled human operator – avoiding overlapping applications of seeds, for example, and saving fuel. Precision farming becomes more interesting and rewarding when it takes account of variability within fields, to apply fertilisers and other inputs automatically at the rates best suited to the crop and soil conditions."

According to Cookson, within five years farmers will be able use precision technologies to tell them "exactly when to fertilise their crops and how much to spread through the automatic system." As a result, investments in precision farming equipment can be quickly recouped. Precision farming is not just limited to GM crops and satellite-based technologies. Cookson continues:

"[Another] approach improves crop productivity through chemicals that enable crops to make better use of nutrients and reduce the stress on the plants. An example of a specialist company developing such technologies is Plant Impact, based in Preston in the north of England. Since its foundation in 2003, Plant Impact has come up with a broad product portfolio. Its PiNT technology releases nitrogen in a controlled way as an amine (a nitrogen compound), which reduces wastage and pollution through leaching into the soil. CaT technology helps plants absorb calcium more efficiently, which can alleviate environmental stress (heat, cold, drought). A third technology, called Alethea, aims to protect plants more broadly against stress, with a new molecule that helps to strengthen cell walls under prolonged adverse conditions."

What's next? The answer could be robotics ["Fields of automation," The Economist, 12 December 09 print issue]. According to the article, "a new generation of agricultural equipment promises to take more of the toil out of farming by automating the business of growing fruit." It continues with a history lesson:

"In the early 1830s, spurred on by his hatred of sweaty field work, Cyrus McCormick took an idea his father had been working on at the family farm in Virginia and produced a mechanical reaper. Others devised similar machines. Despite initial scepticism, farmers eventually bought them in droves. With one person riding the horse that pulled the reaper, and another raking the cut stalks off the back, the machines could harvest as much grain in a day as a dozen men breaking their backs with reaping hooks. Mechanical reapers became even more efficient when adapted to bale the stalks into sheaves, too. Development continued: today a driver in the air-conditioned cabin of a combine harvester may be guided by satellites as he cuts, threshes and pours clean grain into a fleet of accompanying trailers."

Unfortunately, many crops still require back-breaking manual labor. This is a problem because fewer people want these jobs, especially as populations in developed countries age. The article continues:

"There are farms where people like McCormick still dream of taking hard, manual work out of agriculture. These farms grow crops that mostly have to be tended and picked by hand, such as apples, oranges and strawberries. In rich countries it is becoming increasingly difficult to find people to do this at wages farmers say they can afford. Seasonal demand adds to the problems: in California, where some 450,000 people, mostly immigrants, are employed on fruit farms at the peak of the harvest, growers often leave some produce to rot. Even Japan’s exquisite and expensive strawberries are becoming too costly to pick because of a shortage of workers, in part caused by an ageing population. Despite worries about food shortages in the coming years, many farmers are more worried about labour shortages."

Japan has longed dream of replacing aging workers with robots. In some parts of the agricultural sector that dream may turn into reality.

"Just as the mechanical reaper transformed the economics of cereal farming, a new wave of agricultural automation promises to do the same in other areas of horticulture. Because picking apples is very different to plucking strawberries, the machines are taking various forms. Some have giant mechanical arms and are towed behind tractors through orchards and vineyards. Some are fully autonomous and able to scurry around on their own, even in paddy fields, like the robotic rice-planter developed by Japan’s National Agricultural Research Centre. Others trundle about inside experimental greenhouses."

The article notes that farmers in the agricultural sector have jealously watched robots assume competitive tasks on factory floors. "Automating factories," the article notes, "is easier than automating farms, which are far less predictable environments: the weather constantly changes, the light alters, the ground can turn from grass to mud, and there are animals and people wandering around. Moreover, unlike car parts, fruit does not come in standard sizes. It moves around on branches in the wind, changes shape and colour, and can be hidden by leaves." All of these are daunting challenges, but technology is just beginning to advance far enough to tackle some of these challenges. In order for robots to move from the laboratory to the field (or orchard), however, they must be both effective and cost efficient.

"Farmers, like factory owners, ... want a return on their investment. 'It is actually not hard to pick an orange, but it is very hard to pick an orange cost effectively,' says Tony Stentz of the Robotics Institute at Carnegie Mellon University in Pittsburgh. Because robots can work all day without a break, they have one advantage over manual labour. But it is their potential for accurate information-gathering that is proving to be an equally important talent. Crop-tending robots that use vision systems, laser sensors, satellite positioning and instruments to measure things like humidity can build up a database of information about each plant. This can be used to detect the onset of disease, says Dr Stentz. A 'smart sprayer' can then deliver precise amounts of chemical to only those plants that require attention instead of spraying an entire field. By observing the development of each plan, crop yields can be predicted more accurately. Automated harvesters will then use the database to identify and gather individual produce whenever it is ready for harvest."

"Sounds great," you say. "Where can I go to buy these mechanical wonders?" Unfortunately, you can't. But, the article reports, "on a small scale it is already possible to see fully automated horticulture in action."

"The Massachusetts Institute of Technology (MIT) has an experimental greenhouse growing cherry tomatoes on raised platforms. It is managed entirely by small robots. Each plant is equipped with sensors which keep track of its condition. If a particular plant is getting a bit dry, one of the robots is summoned to water it. When a tomato is identified as being ripe, the robot uses its vision system to locate the fruit on the vine and pick it with a mechanical arm. Daniela Rus, director of MIT’s Distributed Robotics Laboratory, says there are a number of ways in which automated systems could improve crops and 'remove some of the hard tedious work from greenhouses'. A plant-centred system using sensors would record not just an individual plant’s progress but also the condition of the soil it is growing in. If nutrients are needed they can be delivered precisely, which would cut down on inputs."

In an earlier post entitled Urban Farmers, I mentioned an idea raised by Dickson D. Despommier, a professor of public health at Columbia University. He suggests that some farms should move indoors; specifically, into high-rise buildings in urban areas so that food is grown closer to those who will eventually consume it. In fact, he believes that with climate change and the world becoming ever more urbanized, the rise of urban farms will be inevitable. It seems to me that Despommier's urban farms and MIT robotic farming techniques make a perfect match. Despommier claims that "if climate change and population growth progress at their current pace, in roughly 50 years farming as we know it will no longer exist' ["A Farm on Every Floor," New York Times, 23 August 2009]. The Economist article also predicts that farming could change dramatically as a result of automation. As an example, it talks about how the grape growing sector could change:

"Greater mechanisation may prompt farmers to change some of their ways and the varieties they grow. An example is Californian raisins, which are traditionally harvested by hand. Workers cut off bunches of grapes and lay them on trays between the rows to dry. As many as 50,000 people used to be required for the harvest. But due in part to declining acreage and increased mechanisation, that has now fallen to 20,000-30,000. Mechanization has come about in a number of ways, according to a report by Philip Martin of the University of California, Davis. Growers, sometimes using varieties that reach optimal sugar levels earlier, slice the canes holding the bunches of grapes so they begin to dry while still on the vine. Modified grape harvesters with rotating fingers then knock off the raisins. If completely dry they are gathered immediately, and if not they are laid onto a continuous paper tray in the vineyard to dry. About 35% of Californian raisins were harvested in 2008 using the continuous-tray system and another 15% dried completely on the vine. The university reckons the traditional hand-harvesting method cost $494 an acre in 2006, compared with $282 an acre in 2008 for the mechanised continuous-tray method. Newly planted vineyards could be even more efficient by using a higher density of vines trained to grow over trellises designed to help with mechanical severing and harvesting."

Moving from grapes for raisins to grapes for vine, the article notes that pruning vines is an important activity which may also someday be mechanized.

"Vision Robotics, a company based in San Diego, has demonstrated a prototype vine-pruning robot. Good pruning requires skill to balance the growth of the vine. The vines also need to be trimmed at certain locations and at precise angles to grow the best grapes for winemaking. The robot is a bit slower than a good human pruner, but it will speed up. It should be able to prune vines at about half the cost of manual labour, says Derek Morikawa, the chief executive of Vision Robotics."

The article moves on to discuss tree-based crops and the orchards through which robots may soon be roaming:

"[Vision Robotics] is also developing apple- and orange-picking robots with multiple arms. These too rely on building 3-D models of trees and the fruit growing on them. Mr Morikawa thinks the crop-scouting ability of such automated machines will prove highly valuable. Supermarkets, for instance, like uniformity so if they want, say, apples of a certain size and in a particular state of ripeness, a farmer could use the model to identify exactly where such apples are growing. The take-up of mechanisation will depend on where the produce is going and how carefully machines can pick it. Light bruising from mechanical harvesting may be acceptable for fruit going to the juicer, but not for fruit displayed on a supermarket aisle. Even though grape harvesters, which shake or knock grapes from vines, have been around for about 40 years, some growers still pick by hand. To compete with hand-picking, robot harvesters will need to twist, pluck, cut or suck produce from stems and handle it as gently as possible. Many factory robots are already capable of doing things like this, and some already sort soft fruit passing along conveyor belts. But operating outside on a farm is much harder. For one thing, lightweight mechanical arms are needed to reach high into trees and pick with precision, despite wind and uneven terrain. Inside a sheltered greenhouse, however, robots feel more at home."

Although automation will continue to play an increasing role in the agricultural sector, machines will never completely eliminate humans; especially those working small farms in developing countries. But even hardscrabble farmers in impoverished countries may someday benefit from tools now being developed by researchers in the forefront of the precision agriculture field. They may discover that they will get better results using different seeds and/or different fertilizers than their neighbors. Douglas William Jerrold, a 19th century English dramatist, wrote, "If you tickle the earth with a hoe she laughs with a harvest." Tickling the earth is the art of farming; and, the art of farming will probably never disappear. The art of farming, however, can tickle a larger harvest from the earth when it is supported by science.

Roads to Prosperity

Roads have enjoyed an important metaphorical (as well as actual) place in man's history. Roads characterized the greatness of the Roman Empire (e.g., "all roads lead to Rome"). Roads remind us that we have important life choices to make (e.g., "There are only two mistakes one can make along the road to truth; not going all the way, and not starting." -- Buddha). And roads have almost universally represented progress (e.g., "All you have to do is look straight and see the road, and when you see it, don't sit looking at it - walk." -- Ayn Rand). Even the Munchkins knew that if you wanted to get to the Emerald City, you had to "follow the yellow brick road."

Although roads have played such a critical role in the history of humankind, they haven't always been welcomed additions to the landscape. Environmentalists continually protest the construction of logging roads cut into old growth forests and anthropologists rant against roads that cut ever deeper into tropical forests threatening to disrupt the lives of indigenous tribes. Even when a road is seen as an important milestone to progress (another metaphor taken from the importance of roads), not everyone is happy about it. One such case is happening in Indonesia ["The Faceoff over Land in Rural Indonesia," by Daniel Ten Kate and Achmad Sukarsono, BusinessWeek, 1 February 2010 print issue]. Kate and Sukarsono report:

"Construction on the six-lane highway meant to span Java, Indonesia's most populous island, comes to an end 200 yards from Nur Salim's rice paddy. While bulldozers claw through woodland and level the red earth nearby, they can't go farther until Salim agrees to sell a patch of land the size of a tennis court. 'We're going to fight to the end,' Salim says in the wooden, single-story home where he and his wife raised their five daughters. 'We have no deadline.' The dispute highlights the obstacles facing President Susilo Bambang Yudhoyono as he tries to fix the country's roads, ports, and railways."

While campaigning for office, President Yudhoyono "pledged to double spending on infrastructure, to $140 billion over the next five years." One could argue that he had some catching up to do. "During Yudhoyono's first five-year term, Indonesia built only 78 miles of expressways." The president would like to double Indonesia's economic growth rate, but he understands that to accomplish that he needs to improve the country's infrastructure. The Trans-Java Expressway was supposed to speed progress, but Kate and Sukarsono claim it "might as well be called the Trans-Java Speedbump." They explain:

"The project began in 1988, but the government has yet to obtain more than half the land for the highway, which will stretch some 740 miles. Only about a quarter of it has been built, in more than 20 sections separated by miles of potholed, two-lane roads. The problem isn't just with highways. Jakarta's Tanjung Priok port, the largest of the country's 2,000-plus seaports, will soon reach capacity. Although an expansion is due by 2013, that will do little to ease congestion once goods leave the quays. Container trucks often need a day to move the seven miles to the nearest highway. The railway from Bandung, Java's third-largest city, stops a half-mile short of the main port, so goods must be transferred to trucks to make a train connection. As a result, produce from the Indonesian island of Borneo can cost more than double that from China, says Zaldy Ilham Masita, chairman of the Indonesia Logistics Assn. 'Companies come here because they see a huge market, but they don't intend to make Indonesia a production center because of the high logistics costs,' Masita says."

Since a portion of Enterra Solutions' business involves helping makes ports and intermodal transportation more efficient and cost effective, I know how important getting the infrastructure right can be. It's hard to imagine a government starting a major highway program over 20 years ago without having a way to gain title to the necessary right of ways. Although I understand Mr. Salim's personal desire to get a good deal for his land, I find it hard to believe that a fair settlement can't be reached with the government. An improvement in the lives of millions of people depends on the completion of the project. Kate and Sukarsono continue:

"Plenty of companies want to help. Siemens and Alstom are interested in building a $200 million rail link from central Jakarta to its airport. General Electric sees 'huge potential' for its power plants, locomotives, jet engines, and more, says David Utama, GE's Indonesia head. Potential doesn't matter when you can't build. A 1961 law allows the president to seize land from those who refuse to sell, but no president has done that. 'Can you imagine the president revoking the land of a poor owner?' asks Frans Sunito, president director of Jasa Marga, which is building the section of highway near Salim's home. A proposed law would shift the onus of seizures to the Public Works Ministry. While owners could appeal the ministry's decision, the land would be immediately transferred to the government. The measure would force Salim to sell—which he says he would do for some $38 per square meter. That's about 15% higher than his neighbors received, so officials are reluctant to make the deal."

My first inclination is to say, "Pay the man." I'm sure the government is thinking, however, that doing so automatically increases the cost of finishing the project by millions of dollars -- money it doesn't have. The fact that so many companies want to help is a good sign. The Trans-Java Expressway (if it's ever completed) could be the cornerstone of greatly improved transportation system in Indonesia. Working together, the government and the private sector could probably speed completion along. That is what India hopes to do as it tackles the improvement of its highway system ["Indian Road Plan Gathers Funding," by Amol Sharma, Wall Street Journal, 22 January 2010]. Sharma reports:

"India's highways minister expects $5 billion in private capital to flow into the country's road projects by June, but said his ambitious plans are running several months behind schedule. Private-equity funds, global investment banks and pension funds have expressed interest in providing financing for India's road projects, said Kamal Nath, minister of road transport and highways, who embarked last year on a global roadshow to court investors. 'Money is the least of my headaches,' Mr. Nath said in an interview. 'India is a good investment destination and roads are a good investment.' Mr. Nath is pushing a massive road-building program that he says will require $70 billion in financing over the next several years. He is targeting $40 billion to $45 billion in private-sector capital, one-third of which would come from foreign investors."

In countries like India and Indonesia where the potential for economic growth is enormous, attracting private capital to help build infrastructure is a viable strategy. India's infrastructure certainly needs a facelift. Sharma continues:

"India's woeful road infrastructure is a drag on national productivity. In cities such as Mumbai, New Delhi and Bangalore, commuters often spend hours to go short distances on traffic-clogged roads. Key arteries are too narrow, and bridges and expressways too few. The booming auto sector is making matters worse, adding nearly 10 million vehicles to the nation's roads last year alone. In rural areas, crumbling one-lane roads make it difficult to get agricultural products to market. Mr. Nath's goal is to build 4,350 miles of roads per year, which means speeding up the current pace of construction 10-fold, to 12.4 miles a day. By June, he hopes that $20 billion in projects, covering 6,835 miles, will be out for bid to road developers. So far this year, about 2,485 miles of projects have been auctioned, he said."

No one could accuse Mr. Nath of not being ambitious. One can almost sense the urgency he feels. His frustrations undoubtedly increased as investors grew wary as a result of the current recession. To ease their concerns, "he says he changed policies to make it easier for them to exit investments and for groups of investors to bid without violating conflict-of-interest rules." Another constant frustration for Mr. Nath, and a concern for investors, is the fact the Indian government has been unable to acquire land for the road projects as quickly as it would like.

"Mr. Nath said the problem is mostly 'procedural,' and says he can bring the average acquisition time down to eight months from 18 months. Mr. Nath says private-equity firms are interested in backing road developers and construction firms, while longer-term investors like pension funds will opt for annuity programs where they make their money back from tolls over time. 'There's no risk, because in India we're not short of traffic,' he said. For the balance of the financing, Mr. Nath expects about $5 billion to come from the World Bank over two years. He is also considering floating foreign-exchange infrastructure bonds. Some of the financing will come directly from the Highways Ministry, whose budget increased 23% last year to $4 billion."

Although the Indian government is expected to undergo some "belt tightening" this year as a result of global economic conditions, Mr. Nath doesn't anticipate his budget being cut. "This is an economic stimulus," he said. "We're creating economic activity in rural areas." Impoverished Indians in rural areas are counting on Mr. Nath's predictions of economic growth to come true ["New highway stirs changes and aspirations in Indian villages," by Rama Lakshmi, Washington Post, 28 January 2010]. Lakshmi begins his report in Karori Village:

"The old, potholed road was a source of endless traffic jams and accidents. It did not have a median or lights. Trucks, tractors and camels frequently collided at night. Like most interstates in India, the road that ran through this village was characterized by chaos and cacophony. On both sides, vendors and laborers congregated at fix-it shops, while educated villagers read newspapers to the less fortunate, sipping hot tea and pontificating on politics. The atmosphere resembled a town square. Last year, though, the road was replaced. In came a four-lane, 130-mile expressway that ran between the cities of Jaipur and Agra and cut the drive time between the two in half. With its lights, median and bright-green signs, the expressway has changed the pace of life for those who gather along it and stirred aspirations in the sleepy villages and small towns nearby. In many ways, the new road is a shining emblem of India's efforts to create economic momentum by upgrading its infrastructure. In an Eisenhower-like mission, the road transport and highway minister, Kamal Nath, recently announced that he wants to add 12 miles of highway across India every day beginning in April. The biggest hole in the country's economic growth, he said, is a lack of good highways that can bring farms and factories closer."

With new roads, local residents are seeing possibilities that seemed impossible in the past. Some residents hope that new factories will be attracted to rural areas because of the highway. Factories mean jobs and jobs mean a better life. Some changes are already taking place. Lakshmi continues:

"Thanks to better access because of the road, a new engineering college opened last August in the town of Dausa. Waiting for a bus outside the school to take him home, 20-year-old Sudha Agarwal said it has 'become easy for girls like me to get an engineering degree now, because the new college is just one hour away from my village.' Her parents had agreed readily, she said. Farmers from 150 villages will soon be able to take their vegetables directly to a new tomato trading center, cutting out expensive middlemen."

As with any change, however, not everyone is pleased with the new highway. Those whose old routines have been disrupted are not happy.

"The speeding traffic has driven out the hawkers who dotted both sides selling nuts, fruit, freshly cut coconut, cucumbers and radishes. 'Earlier, we had a small road, and there were constant jams. But that helped hawkers. People got bored waiting in their vehicles and bought things to munch,' said Bhure Lal, 29, a groundnut trader who lay in the winter sun atop jute sacks of nuts near the expressway. 'The highway may be good for speed, but it has destroyed many small livelihoods.'"

Knowing how industrious, intelligent, and innovative Indian people can be, I'm guessing that those who have been displaced will quickly adjust to their new circumstances. Lakshmi reports, however, that some things never seem to change.

"The old 'anything-goes' lifestyle stubbornly refuses to adjust to all the new rules of the road. On a recent day, a tractor appeared heading the wrong direction, and the speeding traffic screeched and swirled around to make way. Villagers made death-defying sprints back and forth across the highway, chasing their goats and children. 'The traffic moves too fast now. People used to fracture their limbs in the accidents earlier, but now . . . an accident means death,' said Ramkishan Sharma, 56-year-old tea shop owner. 'We want the freedom to cross by foot to reach the other side whenever needed.' Villagers have broken the median at many spots so they can cut across on motorcycles. Motorists take short detours on village routes to avoid the toll plaza. In a concession to the old ways, the highway has cattle-crossing underpasses and lanes for slow-moving camel carts. Managing the new Indian highway has perhaps been as challenging as building it. Brahm Dutt Kaushik, a manager of the Malaysian company that built and manages the highway, maintains a fat file of police complaints against villagers accused of stealing the new aluminum highway signboards, solar-paneled emergency phone boxes and strips of pedestrian railing. 'They sell these as scrap in the local market,' he said. 'It has become a nuisance.' But businessmen in the handicrafts town of Sikandra, known for stone-carving, say the new road will have a positive effect on development, tourism and commerce. 'Big people will come on this highway and see our handicrafts now,' said Hiralal Saini, 35, who sells sandstone-carved gazebos, lamps and garden accessories, which he exports to the United States and Belgium. 'When a big road comes up, bigger things follow.'"

India will eventually fall into a routine as the highway system is completed. I predict that one day the new system will be as historically important for India as the Eisenhower interstate system has been for the United States. India should study the U.S. system and draw lessons from it. If India's system is constructed correctly, the highway system should be accompanied by mass transit and electric transmission lines that share the same right of ways. The system should be built with the future in mind. It should improve the quality of peoples' lives and not simply add to the congestion and pollution that are too often the companions of growth. Of course, predicting the future is not for the faint of heart. The late business guru Peter Drucker, using a road analogy, once said, "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." The only thing we know for sure is that infrastructure is important for sustained economic development.