Advertising Works: That’s Why Companies Spend So Much Money On It

This year 29 entrants will vie to qualify for the grand prize race for the 10 million dollar Automotive XPrize to be held next year in 2010. There will be two categories: mainstream (four passenger and at least a 200 mile range), and alternative (two passenger and at least a 100 mile range). The winners must “exceed 100 miles per gallon, meet strict emission standards, and finish in the fastest time.”

Entrants must meet several specifications intended to encourage designs that are safe, reliable, and desirable — at competitive prices. This is one attempt to address the coming ‘twin peaks’ of peak oil and global warming by encouraging the development of cars that use less gas and produce fewer harmful emissions. While not a long-term solution, a 100mpg car would help a lot while we await the development of a good mass transit infrastructure.

(Parenthetically, I still think the idea of ‘train ferries’ makes good sense: that is, we take the train  long distances with our little ‘runabouts’ loaded onto carrier cars behind us. Then, when we reach our destination we are comfortable and relaxed. We unload our little cars and can explore the area with great freedom and convenience.)

There are five general types of cars that have been accepted to compete for the Auto Xprize. Eleven of them are hybrids, nine use alternative fuels, such as diesel, compressed natural gas, ethanol, etc. Four are electric cars and one is the compressed air car. And four use regular gas.

Perhaps the most depressing thing about this list is that several of the entries use no new technology at all. In other words, it has been possible to make a 100mpg car for some time. As the Auto Xprize publicity says, the reason we don’t have these highly efficient cars already is that “increases in energy efficiency have been ‘spent’ on increased vehicle power, acceleration, and weight, rather than in increased fuel economy.”

You will hear American auto industry apologists arguing that they only built SUV’s and pickups because “the public demanded them”. Which conveniently ignores the fact that they bombarded us with advertising for big vehicles. Why?  Because their profit margin was much higher on them. That advertising convinced many of us.

We have a wasteful society because it has been (and is) profitiable.


It’s Just Too — well — Renewable

Peak oil, global warming, environmental destruction, dangers from war and terrorism — it would seem we need to invest in energy security. Why don’t we?

We hear from the media that alternative renewables can only provide a small portion of the energy we need, and it’s not reliable. Solar power can only be generated when the sun shines, wind only when the wind blows, and so on. And that’s true, as far as it goes. It is true that renewables would have to be a mix.

But I just read an article on (which they got from the Wall Street Journal) about the problems the Danish utility company is having with wind power. Because they have a lot of windy coastline, Denmark built enough windmills along it to generate 20 percent of their electricity.

But often, it gets really windy. When that happens, the percentage of electricity generated by the windmills can climb to 40 percent. If that happens, the price of electricity can drop to zero “leaving utilities scrambling to offload excess power or take a financial hit”.

So far, they have been selling the extra electricity cheap to Sweden and Norway. This is neither a desirable nor a long-term solution. So the Danish utility company is planning to build a country-wide system for charging electric cars with the excess power. (Israel is doing the same.)

So the problem in Denmark is that renewables are just so darn — well — renewable. The wind just keeps blowing. Blowing down the price of electricity. Thus the task of the utility company becomes finding ways to use excess electricity. In other words, to find ways to limit the supply of electricity enough to keep the price up. (Are you wondering why they need to keep the price up?)

And all this bother because they have built enough windmills to provide 20 percent of their electricity on ‘normal’ wind days. Kind of makes me wonder what would happen if they built enough for 50 percent wind power and 50 percent solar power — or 50 percent tidal power. Would electricity be virtually free except for small maintenance and labor costs? So abundant we couldn’t find ways to use it all?

Profit demands scarcity. Faced with abundance, our economy would be in ruins. It seems the name of the “man behind the curtain” in our energy woes is Profit.