The Challenge of Efficiency Investments

One question I often get is why companies don’t make efficiency update to their datacenters more regularly. Part of the answer is the complexity and associated fear of modifying an operating IT infrastructure, which is especially challenging in 24x7 environments. However, there’s another set of issues. Here’s a typical scenario: A company buys energy efficient capital equipment now, which has a certain tax/accounting treatment The resulting savings come down the road in the form of reduced operating expenses, which have a different tax/accounting treatment There are three natural problems with this inside companies:

Paper: Analyzing the DOE Loan Program

The Solyndra bankruptcy has, not unexpectedly, resulted in a wide range of reactions. On one end we have “This was a horrible investment and waste of taxpayers’ money. We should shut down the whole program,” and on the other end “Every investment has risks, and if you want success on a big problem there will be some minor setbacks. This is totally healthy and expected.” I found myself having conflicting reactions, with my rational side understanding the portfolio perspective, my business instinct telling me that Solyndra was a really bad investment, and my energy innovation advocate persona saying “That money could have doubled or tripled the size of ARPA-E for this year!

It's Just Another Tax, Folks

On 3/18 the WSJ reported that Energy Secretary Steven Chu “advocated adjusting trade duties as a ‘weapon’ to protect U.S. manufacturing”. Basically, the threat is that we’ll increase tariffs to protect energy-intensive industries where they compete with products coming from countries that don’t apply a tax on CO2. What interests me in this article and many others lately is that somehow a carbon tax (or cap and trade, there’s little difference for most people in the economy other than how the price is set) is somehow different than just another tax.

US Innovation Talk Outline

Outline for Talk at US Innovation Panel Washington, DC 12/1/08 Today I want to talk about enabling “national scale” innovation, or how to create innovation with thousands, or even millions of people, spanning public and private investment. Why national scale innovation? Simple. Many of our problems are national (and global) in scale and are so complicated that, as much as we’d like to believe it, a researcher in some lab somewhere is not going to invent or discover the magic silver bullet that makes our problems go away.