Tuesday, September 27, 2011

Coolest Job In America this week

Not that this is a regular feature of the blog, but these guys have the coolest job in America right now:

If you have the guts for it, I have got to think it would be pretty cool to rappel down the Washington Monument.  The view from up there is pretty cool, and you'd also be the first person in quite some time to inspect the world's first large casting of aluminum (100 ounces!), which adorns the very tippy-top of the monument.  When it was finished in 1884, aluminum was a very new and novel metal that was crazy expensive.  New processes made aluminum much cheaper to manufacture, so the novelty of the cap became less cool just a few years after it was dedicated.

And if you haven't seen the video taken from atop the Washington Monument, it is well worth the 30 seconds of viewing.  It's pretty impressive how much things rattle and shake.  Here, I've even embedded it for you; just click.

Thursday, September 22, 2011

The Loan Guarantee Program Gets a Bad Rap

I've been planning this post for months, but the recent Solyndra press (and the negativity that it's bringing on the whole program) has spurred me into getting off my duff and actually writing about it.

Initially, the government gave a $535 million loan guarantee to a company called Solyndra, which needed additional funding to help start up its innovative new way of making solar panels.  The term "guarantee" is important here, because the government is just providing a guarantee -- it's not actually loaning out any money.

So, on the face of things, the Loan Guarantee Program is a great program:

  • It doesn't cost the taxpayers any money up front,
  • It has the potential for making money through the credit subsidy cost that the government charges in return for the loan guarantee,
  • It supports innovative, new technologies for making electricity, and
  • It creates jobs.

The federal government isn't on the hook for any money unless the company defaults and goes bankrupt.  And -- even if the company does go belly up -- the government usually secures the right to be "first in line" for grabbing any leftover assets that the company may have had.  So, if the unthinkable does happen, at least the government can go in, collect all the inventory, and hopefully auction it off and salvage some of the money.

Initially, the reports on the Solyndra case were very negative.  "OMG!!" they reported.  "A government funded program went bankrupt!!"

This really upset me.  The whole purpose of the loan guarantee program is to promote risky, high tech industries that can't get funding elsewhere.  From the 2005 Energy Act language that started the whole program:
Section 1703 of Title XVII of the Energy Policy Act of 2005 authorizes the U.S. Department of Energy to support innovative clean energy technologies that are typically unable to obtain conventional private financing due to high technology risks. [Emphasis added]
No matter how you slice it, higher risk == higher potential of failure.  At first, I thought people were unwilling to accept this.

But then things got juicy, when it appeared there may have been a connection between Solyndra, one of its financiers, and the Obama Administration.  And then the Solyndra executives are going to plead the 5th amendment when they have to testify? Yeesh.

It also appeared that, back in May or so, the government re-structured the loan guarantee so that it no longer had first-rights to the assets in case Solyndra went belly up.  Giving up these first rights was apparently a last-ditch effort to raise more funding for Solyndra.

So, who is to blame for all of this?  Did the Obama administration really reach in with its Noodly Appendage and skew the loan towards benefitting one of the administration's donors?  Perhaps.  But there's an easy way to figure this out, and satisfy everyone:

For every loan that is granted (and for those that are not), the Loan Program Office brings in an independent engineering firm to review the project from top to bottom, soup to nuts.  The Independent Engineer writes a (sometimes exhaustive) review to characterize the risks and the likelihood of success.  It should be readily apparent from this review (along with any follow up reviews that may have been done) whether the Solyndra business venture was really viable or not.

The fact that it hasn't been released is somewhat concerning to me ... I have a suspicion that if that independent review was a glowing one, then it would have already been released.

Taking a Step Back

I decided to take a step back, and thought, "What else has the Loan Program Office been up to, and what investments tend to have the biggest payoff for the taxpayer?"

Conveniently, the Loan Program Office lists all of its projects funded to date, the amount of the loan guarantee, and some other stats about the project.  Most notably for me, the total expected number of megawatt-hours (MW-hr) each project is supposed to produce, annually.

In layman's terms, the annual MW-hr figure is the amount of JUICE the plant can crank out per year.  So, which projects crank out the most juice for the lowest investment cost?  I copied the data as published on the DOE site, and compiled it into a table.

Wow.  Geothermal is cheap.  I was surprised at that.  Right after that is nuclear, which I was pleasantly surprised to see.  And solar, no matter how you slice it, is still pricey.  Wind is somewhere in the middle.

I was, however, encouraged to see that the rooftop solar project (putting solar panels on rooftops, and in this case at military installations) was the most affordable of the solar bunch.  Personally, I have always liked that idea -- we're not using our rooftops for anything else, so we might as well stick some solar panels up there and use the energy productively.

If I had more time, I would color-code the bars based on what technology each one is, but it's getting late and this post is getting long.  Please support your local engineer.  :)

Thursday, September 8, 2011

Chess, as Life

I sheepishly admit that I continue to get creamed by the chess program on my phone, even at the easiest level.

But, even though I suck at chess, there are important parallels with life and lessons to be learned.  Some of these have been brought home to me in recent days.  The biggest one, and the one I think others should learn, too, is:

Your Opponent Has a Strategy, Too.

I've sat through more than a few "business planning meetings" or "strategy sessions" and even a few reviews of other people's proposals.  In many of them, people's winning strategy, or method for getting the desired result, can basically be boiled down to, "We're gonna win!  Yeah!"


To continue the chess analogy, it's like saying, "We're going to advance some pawns up the board!  And then we're going to push up a knight or two, and maybe place our bishop near the center where they have lots of scope!  And then we're going to bring out THE QUEEN!  We'll be unstoppable when we pin the opponents' king in the corner, and it'll be checkmate then."

To the uninitiated, this might all sound very convincing.  The strategy is to use a variety of pieces, who have different abilities, then use a fancy word (like "scope") to imply that we really know what we're doing, and lastly to bring in something REALLY powerful (like THE QUEEN) -- and victory is "assured" in this hazy grayness of uncertainty.

This all sounds convincing until you actually play chess, and you realize that the opponent has the exact same pieces you do -- and, in fact, is trying to capture your king just as much as you're trying to get the opponent's king. Your Opponent Has a Strategy, Too.

It's not good enough to have a winning strategy in the absence of an opponent.  You have to be better than the other guy.  And that other guy is going to try to thwart your moves and your initial strategy.

Thus, since the other guy is likely to fight back, or at least put up some resistance, it leads me to my second lesson:

You Need To Think More Than One Move Ahead.

This is the one that consistently trips me up in chess, but I like to think I'm getting slightly better at it in life -- and one that many people (but certainly not all) just don't seem to grasp in real life.

I always craft these great traps in chess to snag a rook, or put the opponent (my phone, in this case) in check -- only to be put in check myself because I didn't see how it would make my king vulnerable.  Gah ... too many moving parts in the game of chess.

But in life, it can actually be a little simpler: so you want to chew some person out at work.  Or you want to send a nasty email.  Or you want to trash some other person's work as baseless and without merit.  That's great.

But wait a minute: how do you think the other person is going to respond??!?  Are they just going to roll over and take it?  Are they going to say, "Gee, you know what, you're absolutely right!  I hadn't thought of that.  All hail the genius person that you are!!"

To go back to the chess analogy, if you throw your queen at the opponent's king recklessly, chances are the other guy is going to capture your queen.  And then your life just got a lot harder.  I wish people would think about how they want the other person to respond before they launch off on some denigrating tirade.  In real life, people get pissed.  They don't just quietly take someone else's tirade; they push back.  They argue.  And the whole thing just spirals rapidly out of control, and everyone ends up worse off for it.

Dale Carnegie said it really well in his book, "How to Win Friends and Influence People": The only way to get the best of an argument is to avoid it. Despite our initial desire to really unload on someone when we get steamed about something, it's just not productive.

The Other Guy Has A Strategy, Too, and You Need to Think More Than Once Move Ahead.

It would make the world a hell of a lot more productive.