Wednesday, 11 April 2018
We will be facing a tough year in a decade in 2018. Central Bank Governor Dr. Indrajit Coomaraswamy addressed the Chamber of Commerce at an afternoon session in late February and explained with facts how he foresees Sri Lankan economy stabilising in 2018 and mentioned his concerns regarding climate change’s impact on the economy.
During question time I mentioned that oil would become $ 100 per barrel by end of 2018 and the audience and even the Governor may have thought I was just guessing. Yes, I was, but there was a very valid reason for that.
During the second half of 2017, I noticed two phenomenon which should not be occurring at the same time. On one hand different automobile manufacturers and country leaders were predicting that they will manufacture only electric vehicles and BEV population in the country will reach 100% respectively by 2035 or 2040, etc. On the other hand, oil prices were increasing slowly, but gradually and steadily.
Under normal circumstances these two trends will be moving in opposite directions; but here they were moving in the same direction. This could happen only when these two aspects – BEV population and oil prices – reach a certain level when the best option for oil producers will be to maximise what they can earn from whatever resources they possess to-day while BEV population – global – is less than 50% or so. So, we have reached that level and oil companies want to maximise their returns. Major suppliers can no longer afford to supply oil at these low prices.
Innovation in 1998
Today there is no worthwhile corporate conversation without innovation being either the title of conversation or occupying a large portion of the conversation. We even have a special Committee on Science, Technology and Innovation. But 20 years ago, it was not like that. In 1998 when we celebrated our 25th client, Trans Asia Hotel – Cinnamon Lakeside today – obtaining ISO 9001 certificate with cocktails at the same hotel, we displayed a banner with a poem from Louis Pattler’s book, “Don’t compete, tilt the field” which ran as follows:
For the want of an innovation, creativity was lost.
For want of creativity, the idea was lost.
For want of an idea, the product was lost.
For want of a product, the customer was lost.
For want of a customer, the business was lost.
For want of a business, the company was lost.
All for the want of a single innovation.
Though it was from a book we had read, the message ‘Innovate or Perish’ was something which was dear and near to us. We had worked in an organisation which would have perished if we had not innovated and it is a well-known blue chip to-day. It was nothing but this personal experience and absolute conviction arising therefrom which prompted us to boldly declare ‘Innovate or Perish’ as our message to Sri Lankan corporate community in an interview we gave to an English daily in late September 2002 on our successful consultancy assignments in Pakistan.
Remembering innovation in 1989
I was Research and Development Manager at Haycarb (HC) under that great CEO, Rajan Yatawera (RY) in the late 1980s and HC activated coconut shell carbon was used in gold extraction plants in many gold mines in the world. Our beloved mothers, wives, sisters and daughters might not know that the gold items they wear on themselves may have been extracted using coconut shells they have scraped in their kitchens and thrown away.
In these plants, activated carbon is mixed with slurries containing ore with gold, silver, nickel, etc. and only the gold part enters tiny micropores in these activated carbons. Then they separate carbon containing gold from slurry containing other minerals by screening and if carbon had been more activated, therefore softer, it would break down into finer particles and go through screens taking more gold with it than planned. So, in selecting carbon for gold recovery applications you strike a balance between hardness and level of activation.
Around 1989, we got an order from a gold mine using carbon from a different supplier and after a fortnight our agent was worried as customer had complained that our carbon was softer and had broken down and thus gone through screeners, taking valuable gold with it to waste. They wanted us to act fast.
My first reaction was that when HC carbon was mixed with another carbon and there is breakdown, we can’t straight away say that our carbon has broken down and it could be even the other carbon. But RY, always the customer’s advocate in our midst, scoffed and suggested we act fast because if that impression persisted we might even lose our existing clients.
When RY visited them, they put some of our carbon particles to an evaporation dish, focused a camera on the same and projected onto a screen. Then they marked and counted the soft particles in our carbon and they did same with other carbons and our carbons had softer particles than competitor carbons. When RY returned, we were asked to double up our efforts and come out with a solution and if we failed, we were told in no uncertain terms, we would perish and HC had to exit the gold mine, literally as well as metaphorically.
We had to come out with devices to (i) eliminate soft particles in the final product (ii) use as a test method to throw out softer particles in carbon. So, we innovated a production unit to separate soft particles from our carbons, during post-activation sizing, and a test method. We called it the Zigzag Separator and the miniature unit of same was used as test method.
We used an air stream to separate softer particles and the beauty of it was that we used same air stream to impinge on carbon at few stages with strongest air stream being used when carbon had lost most of its softer particles. It solved the problem and Haycarb did not perish.
If we go by definition of innovation given by Clayton Christensen as “something different which has impact”, the Zigzag Separator was an innovation. It was definitely different from the normal air separators used which are single stage separators and it had tremendous impact. Even if we go by the definition given by Joseph Schumpeter – “new technology impacting the business world” — it was an innovation. When somebody enters Haycarb factory at Madampe and proceeds further, he would see this Zigzag Separator standing tall on to his left.
Sometimes I wonder what would have happened if I did not come out with this Zigzag Separator. Would Haycarb have perished? Would current shareholders have enjoyed that Rs. 500 million profit and the country the billions of rupees in foreign exchange earned every year?
So, when I read Louis Patler in 1998, I understood and realised validity and significance of each of the statements in the poem. It was the best message I could give my dear customers and different stakeholders who came to celebrate our 25th ISO 9001 certificate in 1998 and I was carrying that thought to the entire Sri Lankan business community by emphasising its significance in my interview with the English daily in September 2002.
Search for
innovation in 2008
Then in 2008, everybody was concerned about energy security and there were pronouncements that ethanol from corn, etc. might become additives to gasoline and this could influence global food security. I wanted to find out whether there could be any alternatives and we could contribute anything to resolve impending energy crisis.
Even ministers started promoting concepts like running automobiles with water. Research at a Chemical Engineering Faculty was on converting waste polythene to a fuel for automobiles. My notebook carries an entry of a telephone conversation, wherein I tried to convince them that it is thermodynamically impossible.
I quoted my experience at polythene and polypropylene plants in Seadrift, USA where 100ft tall fluidised bed reactor was expected to melt in a few hours if cycle gas cooler lost electric power and could not take away that enormous amount of heat generated. They would run the same cycle gas cooler as a turbine expander to feed in CO2 to kill the exothermic polymerisation reaction. So, we were planning to reverse this extremely exothermic reaction using normal distillation processes. It was of no avail as they were confident about the final outcome and they had even measured the flash point of their product and it was meeting the specification. Today, everyone knows the outcome of that research.
We wanted to identify a reliable and affordable source of energy which is environmentally benign as well. We had gathered from annual reports of the Central Bank, that whatever gains we had got from increased exports of apparel, etc., vanished due to increased oil import bills. So, we wanted our energy sourcing to be reliant on something, the price of which cannot be dictated by another set of human beings or countries. That left us with solar energy, wind energy and energy in the clouds.
Since solar is the energy which (i) is universally available and (ii) we harnessed to dry coir dust in 1989 and created an industry bringing Rs. 2 billion of foreign exchange every year, we decided to work on solar energy. We had three options available: concentrated solar thermal, rooftop photovoltaic solar arrangements and photovoltaic solar parks.
One of our first steps in this initiative was to identify the environmental aspects leading to climate change. We identified them as (1) we change what we do to incident solar radiation we receive, (2) we generate waste energy when we convert energy from one form to another, (3) we do not allow this waste energy and unutilised solar energy to escape from our system by emitting greenhouse gases. The moment we do fuel switching from fossil fuels to solar, both the second and third aspects are addressed fully and our siting of PV solar panels should address the first aspect also to the maximum. The construction of the black asphaltic road surface after deforestation is the worst case of the first aspect and thus it is the obvious place to lay PV solar panels from the climate change point of view.
This is how we arrived at our innovation for the energy crisis and climate change, a solution addressing both these issues at the same time. It again is an innovation – “something different which has impact”, tremendous impact at that or “a new technology impacting not only the business world; but the entire mankind”.
Then we completed our designs and in its final arrangement it answers the climate change issue through four possible avenues: (a) By being a geo-engineering solution, (b) by energy switching, (c) by being more efficient on supply side and (d) by being more efficient on demand side. The final design we developed is what we call highway solarisation which is defined as follows:
“A dedicated infrastructure to generate electricity for powering battery electric vehicles or the main grid using solar energy collected by PV solar panels installed along and above the highways as a solution for climate change.”
From 2008-2015
During these years we were promoting this innovation by writing to papers and trying to convince government and ministers about usefulness of this innovation. When Anura Priyadarshana Yapa was Minister of Environment and Champika Ranawaka, Minister of Power and Energy, we made a presentation to Minister Yapa and he wanted the Ministry to pursue it.
The Ministry arranged for a gathering of representative from different ministries – Energy, Highways, Transport, Trade and Commerce to listen to a presentation by us. Nobody had any questions for us and they were pleased about the solution. Then Ministry wanted us to prepare a cabinet paper on the same and it was almost completed when Ministers of Petroleum Industries and Environment were swapped and so were the Ministers of Power and Energy and Science and Technology. Thus, that initiative stopped there.
There were powerful secretaries saying at meetings of officials from different ministries that they will not allow houses to be built on highways as if highways have been built with their personal money and the masses don’t need to pay for them. He was unable to understand that we were helping them by developing a tradable product on loan funded infrastructure or he had more lucrative funding options. They are a brand non-existent today.
Post-2015 era
Then we come to the post-2015 era and we brought it to the notice of our new President/Minister of Environment. I was requested to make a presentation to the engineers of the Ministry of Mahaweli Development which was done and it ended there or probably it resulted in somebody trying to set up floating solar arrangements on some Mahaweli reservoirs.
When Champika Ranawaka as Minister of Power and Energy in the interim Government from January to August 2015, at the International Energy Symposium in June 2015 we made a presentation on ‘Applying Six Sigma DMADV2 Methodology to solve Climate Change’ and it ultimately led to highway solarisation and we said that we had to do the validation of the solution only. Dr. M.S. Batagoda, Secretary of Power and Energy, gave us a Certificate of Excellence for that presentation and we thought he would take it further and allow us to validate and bring credit to the Sri Lanka’s intelligentsia. But nothing happened.
Then I made a presentation at the Public Consultation Session on the Long-Term Generation Plan held on 25 September 2015 by the Public Utilities Commission. I made it very clear that we need to go in for this project while the oil prices remain at their current levels then. Prices have gone up by 35% already. But nothing happened.
We made another presentation to the PUCSL again in June, 2017; but there were no initiatives from them to study this further and make use of it.
While writing to different ministries related to the project and also to Road Development Authority, we still have not received the go ahead from them. As we have expressed in a recent article to the papers, solarisation of the Southern Expressway extension is the one and only way to earn a revenue and save adequate foreign exchange to pay back for solarisation effort as well as for the road construction. Otherwise we will remain eternally indebted to the Chinese Government till one fine day they will either say “okay, we will write it off” like what they told late Lakshman Kadirgamar during President Chandrika Bandaranaike’s regime or will purchase the highway like what they did recently in respect of the Hambantota Port. Recently we published a few articles on the superiority of this solution for climate change above all others ever mentioned in literature on sustainable energy and climate change.
I strongly believe that we do not have much time to face a world with $100 a barrel of petrol and we need to act fact. If we do act fast, we might be able to have the pilot project a – 10MW project on a 3.4 km stretch on the Mirijjawila-Suriyawewa 100ft road, on which we used to dry paddy in early 2015, up and running by end 2018. Based on its success, we could implement at other locations as well up to a total of at least 3,800 MW power.
Comparison of costs and impacts
How highway solarisation will influence our livelihood could be best explained by looking at what happens when a public officer does a trip of 200 kms in a SUV doing only five km per litre of petrol at Rs. 117 per litre and in a Battery Electric Vehicle (BEV) powered by highway solarisation. Table 1 depicts how this trip would influence the climate as well as the economic performance of the country. Please also note that when s/he does this trip in the SUV and spends Rs. 4,680 for the fuel, s/he is paying Rs. 58.50 per actual kWhr of energy from the fuel used during the trip.
One could see from this single table what we are doing to our economy and the climate by being blind to an indigenous solution and not attempting to solve climate change which this small island nation of 65,000 km2 can ill afford to live with. Very often, we see pronouncements by knowledgeable people that transportation contributes nearly 50% to the total greenhouse gas emissions in Sri Lanka. Should not the parliamentarians, Ministers of Power and Energy, Environment, Finance, Economic Affairs and Policy Planning and Highways take a look at this project and give some hope to the people of this country? I hope they know that oil price in dollar terms and exchange rate of the dollar itself would go up in time to come.
Conclusion
We know that oil has to go up in price and it will. When the OPEC countries could see BEVs catching up, they will initially try to discourage the same by holding oil prices low and after a point when they see it unstoppable, they will try to make maximum use of whatever oil they have and increase price of oil with that intention.
It is left to us to foresee this and make our own arrangements to reduce our overall cost and save the environment and protect mankind from climate change. With this innovation already in place to face this, should we allow ourselves and future generations to perish?
(The writer is Managing Director, Somaratna Consultants Ltd.)
2018-04-11
