Karma Automotive raises $100 million as it looks to resell it EV platform to other automakers

Karma Automotive has raised a $100 million lifeline from outside investors, as reported by Bloomberg, with the struggling electric vehicle maker’s fortunes likely buoyed by the current market optimism on other EV companies including Tesla. Karma is the reincarnated version of Fisker Automotive, which previously faced bankruptcy before being acquired by Wanxiang Group in 2014.

Karma Automotive has made more progress than Fisker ever did, including actually delivering around 500 of its inaugural Revero electric sport sedan in 2019. The company will be continuing to sell the Revero, which retails staring at around $140,000, and will also be looking to add a high horsepower GTE version, as well as a supercar for an even higher-tier customer.

The automaker also says that it’s in discussions with a partner for a commercial delivery truck, which it intends to develop in prototype form by year’s end. There are a number of different companies pursuing delivery vans for use by courier companies including UPS and FedEx, and the increase in e-commerce spending does present an opportunity for multiple players to succeed in this category, even as there is a rush on in terms of entrants.

Karma will also seek to leverage and extend the benefits of its fresh investment by shopping around its EV platform to other automakers and OEMs, the company says, and also will eventually expand beyond pure EVs to hybrid fuel vehicles. In short, it sounds like Karma is willing to try just about everything and anything to chart a path towards profitability, but time will tell if that’s intelligent opportunism, or scattershot desperation.

Sunrun’s $3.2 billion Vivint Solar bid challenges Tesla’s energy ambitions

Tesla’s 2014 acquisition of SolarCity turned the electric vehicle manufacturer into the undisputed largest player in residential solar, but that lead has steadily eroded as its major competitor, Sunrun, surged ahead with more aggressive plans. Now with the $3.2 billion acquisition of the residential solar installation company Vivint Solar, Sunrun looks to solidify its place in the top spot.

From Tesla’s very early days Elon Musk has tried to define the company as an energy company rather than just a manufacturer of electric vehicles. When Tesla made its $2.6 billion bid for SolarCity the move was viewed as the culmination of the first phase of its “master plan,” which called for Tesla to “provide zero emission electric power generation options.”

Now that plan faces a major test from a publicly traded competitor that’s focused solely on providing residential solar power and the ability to lower costs for its panels through greater efficiencies of scale, according to analysts who track the solar energy sector.

Sunrun will be freaking big,” Joe Osha, an analyst at JMP Securities, told Bloomberg News. “They are clearly looking for ways to get scale and efficiency.”

Indeed, the combined companies will save roughly $90 million per year thanks to operational efficiencies, according to a statement from Sunrun. And the economies of scale will give the companies even more leverage when they contract with utilities on feeding power into the electric grid.

As Sunrun acknowledged in the announcement of its acquisition of the Blackstone-backed Vivint, the combined customer base of 500,000 homes represents over 3 gigawatts of solar assets. That figure still is only 3% penetration of the total market for residential solar in the United States.

Sunrun had already edged out Tesla for the top spot in residential solar installations, and together the two companies account for 75% of new residential solar leases each quarter, according to data from Bloomberg NEF.

“Americans want clean and resilient energy. Vivint Solar adds an important and high-quality sales channel that enables our combined company to reach more households and raise awareness about the benefits of home solar and batteries,” Sunrun CEO and co-founder Lynn Jurich said in a statement. “This transaction will increase our scale and grow our energy services network to help replace centralized, polluting power plants and accelerate the transition to a 100% clean energy future.”

Even as Sunrun’s $1.46 billion stock (and the assumption of about $1.8 billion in debt) creates a massive competitor to Tesla’s solar business, there’s an opportunity for Tesla to sell more batteries through its residential solar competitor.

Sunrun and Vivint will likely be pushing their customers to add energy storage to their solar installations, and that means using either Tesla’s Powerwall batteries or its own Brightbox batteries manufactured in partnership with LG Chem .

Investors have responded to Sunrun’s latest maneuver by pouring money into the stock. Sunrun’s shares were up more than $5 in midday trading.

Image Courtesy: Yahoo Finance

“Vivint Solar and Sunrun have long shared a common goal of bringing clean, affordable, resilient energy to homeowners,” said David Bywater, chief executive officer of Vivint Solar, in a statement. “Joining forces with Sunrun will allow us to reach a broader set of customers and accelerate the pace of clean energy adoption and grid modernization. We believe this transaction will create value for our customers, our shareholders, and our partners.”

Amazon really just renamed a Seattle stadium ‘Climate Pledge Arena’

As perennial front runner for the title of probably-the-most-evil tech company, Amazon has a long way to go to rehabilitate its image as a take-no-prisoners, industry-consolidating wealth machine.

In a bold effort to do so, the company announced today that it would buy the rights to Seattle’s KeyArena, an aging stadium currently under redevelopment in the city. Amazon founder and CEO Jeff Bezos boasts that the stadium will “be the first net zero carbon certified arena in the world.”

“Instead of calling it Amazon Arena, we’re naming it Climate Pledge Arena as a regular reminder of the urgent need for climate action,” Jeff Bezos wrote on Instagram.

Other regular reminders for urgent climate action include the company’s own employees walking out to protest its lack of accountability on climate issues, its ongoing courtship with oil and gas companies and the sheer amount of times in a single day we see Amazon delivery vans dropping packages off on the same block.

Addressing its record of climate indifference, Amazon announced a $2 billion investment in sustainable efforts to reduce the company’s massive carbon footprint earlier this week as part of the same climate-friendly PR blitz.

Bezos himself announced in February that he would invest $10 billion of his personal wealth in a fund to address climate change, which is probably the least you can do when you’ve amassed an amount of wealth that’s incomprehensible to any normal person at the expense of workers, the environment and whatever else got in the way.

European VC firm Pale Blue Dot plans to fund 40 ‘planet-positive’ startups

Pale Blue Dot, a newly outed European venture capital firm focused on climate tech, announced this week the first closing of its debut fund at €53 million.

Targeting pre-seed and seed stage startups, the firm says it will consider software and technology investments with a strong positive climate impact. Current areas of focus include food/agriculture, industry, fashion/apparel, energy and transportation, with plans to back up to 40 companies out of fund one.

Founding partners Hampus Jakobsson, Heidi Lindvall and Joel Larsson are stalwarts of the Nordic tech ecosystem and beyond: Jakobsson co-founded TAT (The Astonishing Tribe), which was sold to Blackberry in 2012, and is a prominent angel investor in Europe, most recently a venture partner at BlueYard Capital . Lindvall is the former head of accelerator and investment team at Fast Track Malmö, with a background in human rights and media. Larsson was previously managing director at Fast Track Malmö, with a technical background and prior fund management experience.

I put questions to all three, delving deeper into Pale Blue Dot’s remit and the firm’s investment thesis. We also discussed the macro trends that warrant a fund specializing in climate tech and why Europe is poised to become a leader in the space.

Pale Blue Dot is a new VC fund specializing in climate tech, but in a sense — and to varying degrees — isn’t every venture capital fund a climate tech fund these days?

Heidi Lindvall: We think all funds should be “planet-positive” and working for a better world, but it will take time until it is a focus. Still, most funds look at a potential positive impact late in their assessment and will not decline the deal if the startups wouldn’t be significantly pulling the world in a good direction.

Hampus Jakobsson: Focus has both upsides and downsides.

The negative part with being niche is that we won’t do investments in amazing people or startups that we don’t think are “climate-contributing enough” or that the founders aren’t doing it in a genuine way (as the risk of them to paying attention to the impact might lead them to become a noncontributing company).

Swappie bags $40.6M to sell more secondhand iPhones across Europe

Finland-based Swappie has closed a €35.8 million ($40.6M) Series B to expand into new markets in Europe. The ecommerce business refurbishes and resells used iPhones, taking care of the entire process from testing and repairing used handsets, to selling the refurbished devices via its own marketplace, with a 12-month warranty.

Local VC and private equity firm TESI is a new investor in the Series B, along with Lifeline Ventures, Reaktor Ventures and Inventure Investors, all of whom participated in Swappie’s 2019 Series A. The total raised to date since the business was founded in 2016 is $48M.

Right now Swappie operates in Finland, Sweden, Denmark and Italy. The new financing will be used to expand across Europe, beginning with launches in Germany, Ireland, Portugal and the Netherlands this summer.

It’s also eyeing expansion beyond Europe — so will be speccing out a broader roadmap for the future.

“The main focus of this round is to become the number one player in Europe. But also to explore opportunities outside Europe as well,” says CEO and co-founder Sami Marttinen. “That’s something we will be looking into but no concrete plans to announce at this point.

“There are still opportunities for our business model everywhere in the world. So it’s a matter of just building the roadmap — where to go next.”

Swappie’s Jiri Heinonen (CMO) and Sami Marttinen (CEO) (Photo credit: Swappie)

Swappie touts growing consumer demand in the region to buy refurbished phones, saying that from 2018 to 2019 revenues grew 4x, hitting $35M+ in net revenue in 2019. It’s also seeing demand continuing to grow this year — recording a 5x increase in net revenue growth in April and May 2020 vs the same period last year, despite the ongoing COVID-19 pandemic. Indeed, the trend of consumers shifting to buying more online looks to be a help for its online marketplace.

Commenting on Swappie’s Series B in a statement, Tony Nysten, Investment Manager at TESI, said: “We believe there is a huge growth opportunity for Swappie. The smartphone market in Europe is worth over €100BN but used or refurbished phones currently make up just over 10% of that and only one in four pre-owned phones are currently re-sold. Through its rapid growth to date, Swappie has proven its ability to not just grow market share within the refurbished market, but to expand the size of the category overall. The business has enormous potential.”

Swappie’s early choice of market focus included not only familiar turf in the Nordics — but Italy, in Southern Europe. The latter was chosen deliberately on account of it being a tough market for ecommerce, per Marttinen.

“In the really early days the reason why we went to Italy was because it was one of the toughest ecommerce markets in Europe — they have a really low ecommerce maturity index. It’s very different in terms of shopping behavior. You need to build another level of trust in that market. There are lots of unique traits like cash on delivery, things like that. So we knew that in order to really conquer the market globally — and to be able to deliver on our global ambitions we would need to enter as difficult markets as early in our journey as possible.

“These days we have a much more advanced playbook and market studies across Europe.”

Swappie describes itself as a ‘scale-up’ tech business on account of addressing the whole value chain, per Marttinen.

“We’ve done a lot there on the hardware side — when it comes to actually refurbishing the devices we can make them even stronger then the original devices in many cases. So that means we can go as deep as onto the motherboard level in the repairs. Then on the software side, of course, we’re making selling and distribution and everything else scalable. Making sure that the checking processes and all the processes in the factory are according to the latest standards,” he says.

“Because of being so focused in also building the processes and focusing on the quality so much, so actually we have been able to truly change the way people consume electronics,” he adds. “If you think about it from a local player perspective they are typically mostly competing for the people who are already buying used devices — whereas we are able to deliver on this market by having full control of the entire value chain, from buying to refurbishing, to selling the phones to consumers.

“Most of our customers are buying used or refurbished devices for the first time — so actually our biggest competitors are new smartphone retailers.”

The most popular iPhone model sold on Swappie’s marketplace last year was the iPhone 8, per Marttinen.

He won’t disclosed the exact number of iPhones Swappie has refurbished and sold at this point but he says it’s a six-figure number — aka ‘hundreds of thousands’. 

The team chose to focus on iPhones to ensure they can deliver the highest quality device refurbishment, he says, while also benefiting from the relatively higher cost of Apple’s smartphone hardware vs Android devices. Though he doesn’t rule out expanding to offer another type of refurbished smartphone in future.  

“The business is now growing really rapidly but what we noticed in the early days is that the new device prices had started to rise before we started this business so we have been very lucky with the timing,” he tells TechCrunch, noting that Swappie also benefitted from the plateauing into advancements between handset models in recent years, as the technology matured.

“If you can build trust into this business, and make sure that the phones function as well as new devices — and that you’re actually making the buying process as well as safe as buying a new phone — that way you can actually accelerate the growth of the market. So that’s what we have been really successful in. It’s kind of the key to being able to grow so quickly.”

“One main point there has been that because we refurbish every device ourselves in our own factory in Finland we can deliver to customers the highest quality devices under warranty for much less than the cost of a new phone and also be more environmentally friendly,” he adds.

While, in years past, there have been instances of iPhone users’ devices bricked after a repair by an unauthorized repair shop Marttinen says Swappie is using only original iPhone parts so has avoided such problems.

He also points to recent European Commission proposals for a pan-EU ‘right to repair’ for electronics which suggests device makers selling in the region will be required to respect repairability, rather than using software updates as a way to penalize consumers who seek to extend the lifespan of their current device.

Photo credit: Swappie

Swappie’s business also slots into a wider Commission mission to transition the EU to a circular economy, as part of the green deal announced by current president, Ursula von der Leyen — so it’s skating to where the puck is headed, if you like.

“It’s really good for the environment that the right to repair legislation has come forward in the past few years. That’s one very important point for us as well which was one of the reasons why we wanted to built microscope level repairs in our factories — so we wouldn’t have to scrap as many phones as you normally would,” Marttinen adds.

What can’t it repair? The proportion of iPhones which turn out to be truly unsalvageable via its processes is “extremely small“, he says. “We can actually do any repairs that are possible to do the phones so, basically, water damaged phones which have been at the bottom of the ocean — those are of course unrepairable. Or if the phone is bent too much or if the motherboard is completely ruined. But basically all the other faults we can repair.”

On the competitive front, he says Swappie’s main rival are retailers selling new iPhones — given it’s trying to woo iOS users away from buying a brand new iPhone. On the secondhand marketplace front Marttinen mentions reBuy as one of the main rival players in refurbishing and reselling electronics, though it does not focus on iPhones — offering a full range of devices, from wearables to smartphones and tablets, laptops, consoles and cameras.

Volkswagen launches home EV charging system sales ahead of ID.3 vehicle deliveries

Volkswagen has started to sell a home-charging device as the automaker prepares to bring its new ID family of electric vehicles to market.

The ID.3 is the first electric vehicle under the ID label and will only be sold in Europe. Customers who made reservations for the launch edition, known as ID.3 1st, will be able to order their vehicle starting June 17. Volkswagen said this week that the deliveries for the ID.3 1st will begin in September.

And that means that, at least for now, the home-charging device known as Wallbox will only be available for sale in eight countries in Europe. Volkswagen is making three versions of the Wallbox that will range in price between €399 and €849 ($448 to $953). Those prices don’t include the cost of installation.

All of the versions will have a charging capacity of up to 11 kilowatts, permanently mounted Type 2 charging cable and integrated DC residual current protection. For now, just the base model is available, according to VW.

The two premium models, the ID. Charger Connect and ID. Charger Pro, will be available later this year. These models come with additional software that allows for the kind of interaction and analytics that Tesla owners are more familiar with. The ID. Charger Connect will allow customers to link their smartphone to control charging processes. The ID. Charger Pro has that connectivity feature plus an integrated electricity meter designed for commercial uses. The integrated meter can be used to bill electricity costs for company car drivers, according to VW.

Wallbox Volkswagen ID. Charger

Image Credits: Volkswagen

The ID.3 is the first model in the company’s new all-electric ID brand and the beginning of its ambitious plan to sell 1 million electric vehicles annually by 2025. The ID.3 will only be sold in Europe. Other models under the ID brand will be sold in North America.

As wildfire season approaches, AI could pinpoint risky regions using satellite imagery

The U.S. has suffered from devastating wildfires over the last few years as global temperatures rise and weather patterns change, making the otherwise natural phenomenon especially unpredictable and severe. To help out, Stanford researchers have found a way to track and predict dry, at-risk areas using machine learning and satellite imagery.

Currently the way forests and scrublands are tested for susceptibility to wildfires is by manually collecting branches and foliage and testing their water content. It’s accurate and reliable, but obviously also quite labor intensive and difficult to scale.

Fortunately, other sources of data have recently become available. The European Space Agency’s Sentinel and Landsat satellites have amassed a trove of imagery of the Earth’s surface that, when carefully analyzed, could provide a secondary source for assessing wildfire risk — and one no one has to risk getting splinters for.

This isn’t the first attempt to make this kind of observation from orbital imagery, but previous efforts relied heavily on visual measurements that are “extremely site-specific,” meaning the analysis method differs greatly depending on the location. No splinters, but still hard to scale. The advance leveraged by the Stanford team is the Sentinel satellites’ “synthetic aperture radar,” which can pierce the forest canopy and image the surface below.

“One of our big breakthroughs was to look at a newer set of satellites that are using much longer wavelengths, which allows the observations to be sensitive to water much deeper into the forest canopy and be directly representative of the fuel moisture content,” said senior author of the paper, Stanford ecoydrologist Alexandra Konings, in a news release.

The team fed this new imagery, collected regularly since 2016, to a machine learning model along with the manual measurements made by the U.S. Forest Service. This lets the model “learn” what particular features of the imagery correlate with the ground-truth measurements.

They then tested the resulting AI agent (the term is employed loosely) by having it make predictions based on old data for which they already knew the answers. It was accurate, but most so in scrublands, one of the most common biomes of the American west and also one of the most susceptible to wildfires.

You can see the results of the project in this interactive map showing the model’s prediction of dryness at different periods all over the western part of the country. That’s not so much for firefighters as a validation of the approach — but the same model, given up to date data, can make predictions about the upcoming wildfire season that could help the authorities make more informed decisions about controlled burns, danger areas, and safety warnings.

The researchers’ work was published in the journal Remote Sensing of Environment.

BeeHero smartens up hives to provide ‘pollination as a service’ with $4M seed round

Vast monoculture farms outstripped the ability of bee populations to pollinate them naturally long ago, but the techniques that have arisen to fill that gap are neither precise nor modern. Israeli startup BeeHero aims to change that by treating hives both as living things and IoT devices, tracking health and pollination progress practically in real time. It just raised a $4 million seed round that should help expand its operations into U.S. agriculture.

Honeybees are used around the world to pollinate crops, and there has been growing demand for beekeepers who can provide lots of hives on short notice and move them wherever they need to be. But the process has been hamstrung by the threat of colony collapse, an increasingly common end to hives, often as the result of mite infestation.

Hives must be deployed and checked manually and regularly, entailing a great deal of labor by the beekeepers — it’s not something just anyone can do. They can only cover so much land over a given period, meaning a hive may go weeks between inspections — during which time it could have succumbed to colony collapse, perhaps dooming the acres it was intended to pollinate to a poor yield. It’s costly, time-consuming, and decidedly last-century.

So what’s the solution? As in so many other industries, it’s the so-called Internet of Things. But the way CEO and founder Omer Davidi explains it, it makes a lot of sense.

“This is a math game, a probabilistic game,” he said. “We’ve modeled the problem, and the main factors that affect it are, one, how do you get more efficient bees into the field, and two, what is the most efficient way to deploy them?”

Normally this would be determined ahead of time and monitored with the aforementioned manual checks. But off-the-shelf sensors can provide a window into the behavior and condition of a hive, monitoring both health and efficiency. You might say it puts the API in apiculture.

“We collect temperature, humidity, sound, there’s an accelerometer. For pollination, we use pollen traps and computer vision to check the amount of pollen brought to the colony,” he said. “We combine this with microclimate stuff and other info, and the behaviors and patterns we see inside the hives correlate with other things. The stress level of the queen, for instance. We’ve tested this on thousands of hives; it’s almost like the bees are telling us, ‘we have a queen problem.’ ”

All this information goes straight to an online dashboard where trends can be assessed, dangerous conditions identified early and plans made for things like replacing or shifting less or more efficient hives.

The company claims that its readings are within a few percentage points of ground truth measurements made by beekeepers, but of course it can be done instantly and from home, saving everyone a lot of time, hassle and cost.

The results of better hive deployment and monitoring can be quite remarkable, though Davidi was quick to add that his company is building on a growing foundation of work in this increasingly important domain.

“We didn’t invent this process, it’s been researched for years by people much smarter than us. But we’ve seen increases in yield of 30-35% in soybeans, 70-100% in apples and cashews in South America,” he said. It may boggle the mind that such immense improvements can come from just better bee management, but the case studies they’ve run have borne it out. Even “self-pollinating” (i.e. by the wind or other measures) crops that don’t need pollinators show serious improvements.

The platform is more than a growth aid and labor saver. Colony collapse is killing honeybees at enormous rates, but if it can be detected early, it can be mitigated and the hive potentially saved. That’s hard to do when time from infection to collapse is a matter of days and you’re inspecting biweekly. BeeHero’s metrics can give early warning of mite infestations, giving beekeepers a head start on keeping their hives alive.

“We’ve seen cases where you can lower mortality by 20-25%,” said Davidi. “It’s good for the farmer to improve pollination, and it’s good for the beekeeper to lose less hives.”

That’s part of the company’s aim to provide value up and down the chain, not just a tool for beekeepers to check the temperatures of their hives. “Helping the bees is good, but it doesn’t solve the whole problem. You want to help whole operations,” Davidi said. The aim is “to provide insights rather than raw data: whether the queen is in danger, if the quality of the pollination is different.”

Other startups have similar ideas, but Davidi noted that they’re generally working on a smaller scale, some focused on hobbyists who want to monitor honey production, or small businesses looking to monitor a few dozen hives versus his company’s nearly 20,000. BeeHero aims for scale both with robust but off-the-shelf hardware to keep costs low, and by focusing on an increasingly tech-savvy agriculture sector here in the States.

“The reason we’re focused on the U.S. is the adoption of precision agriculture is very high in this market, and I must say it’s a huge market,” Davidi said. “Eighty percent of the world’s almonds are grown in California, so you have a small area where you can have a big impact.”

The $4 million seed round’s investors include Rabo Food and Agri Innovation Fund, UpWest, iAngels, Plug and Play, and J-Ventures.

BeeHero is still very much also working on R&D, exploring other crops, improved metrics and partnerships with universities to use the hive data in academic studies. Expect to hear more as the market grows and the need for smart bee management starts sounding a little less weird and a lot more like a necessity for modern agriculture.

Our love of the cloud is making a green energy future impossible

An epic number of citizens are video-conferencing to work in these lockdown times. But as they trade in a gas-burning commute for digital connectivity, their personal energy use for each two hours of video is greater than the share of fuel they would have consumed on a four-mile train ride. Add to this, millions of students ‘driving’ to class on the internet instead of walking.

Meanwhile in other corners of the digital universe, scientists furiously deploy algorithms to accelerate research. Yet, the pattern-learning phase for a single artificial intelligence application can consume more compute energy than 10,000 cars do in a day.

This grand ‘experiment’ in shifting societal energy use is visible, at least indirectly, in one high-level fact set. By the first week of April, U.S. gasoline use had collapsed by 30 percent, but overall electric demand was down less than seven percent. That dynamic is in fact indicative of an underlying trend for the future. While transportation fuel use will eventually rebound, real economic growth is tied to our electrically fueled digital future.

The COVID-19 crisis highlights just how much more sophisticated and robust the 2020 internet is from what existed as recently as 2008 when the economy last collapsed, an internet ‘century’ ago. If a national lockdown had occurred back then, most of the tens of millions who now telecommute would have joined the nearly 20 million who got laid off. Nor would it have been nearly as practical for universities and schools to have tens of millions of students learning from home.

Analysts have widely documented massive increases in internet traffic from all manner of stay-at-home activities. Digital traffic measures have spiked for everything from online groceries to video games and movie streaming. So far, the system has ably handled it all, and the cloud has been continuously available, minus the occasional hiccup.

There’s more to the cloud’s role during the COVID-19 crisis than one-click teleconferencing and video chatting. Telemedicine has finally been unleashed. And we’ve seen, for example, apps quickly emerge to help self-evaluate symptoms and AI tools put to work to enhance X-ray diagnoses and to help with contact tracing. The cloud has also allowed researchers to rapidly create “data lakes” of clinical information to fuel the astronomical capacities of today’s supercomputers deployed in pursuit of therapeutics and vaccines. 

The future of AI and the cloud will bring us a lot more of the above, along with practical home diagnostics and useful VR-based telemedicine, not to mention hyper-accelerated clinical trials for new therapies. And this says nothing about what the cloud will yet enable in the 80 percent of the economy that’s not part of healthcare.

For all of the excitement that these new capabilities offer us though, the bedrock behind all of that cloud computing will remain consistent — and consistently increasing — demand for energy. Far from saving energy, our AI-enabled workplace future uses more energy than ever before, a challenge the tech industry rapidly needs to assess and consider in the years ahead.

The new information infrastructure

The cloud is vital infrastructure. That will and should reshape many priorities. Only a couple of months ago, tech titans were elbowing each other aside to issue pledges about reducing energy usage and promoting ‘green’ energy for their operations. Doubtlessly, such issues will remain important. But reliability and resilience — in short, availability — will now move to the top priority.

As Fatih Birol, Executive Director of the International Energy Agency (IEA) last month reminded his constituency, in a diplomatic understatement, about the future of wind and solar: “Today, we’re witnessing a society that has an even greater reliance on digital technology” which “highlights the need for policy makers to carefully assess the potential availability of flexibility resources under extreme conditions.” In the economically stressed times that will follow the COVID-19 crisis, the price society must pay to ensure “availability” will matter far more.

It is still prohibitively expensive to provide high reliability electricity with solar and wind technologies. Those that claim solar/wind are at “grid parity” aren’t looking at reality. The data show that overall costs of grid kilowatt-hours are roughly 200 to 300 percent higher in Europe where the share of power from wind/solar is far greater than in the U.S. It bears noting that big industrial electricity users, including tech companies, generally enjoy deep discounts from the grid average, which leaves consumers burdened with higher costs.

Put in somewhat simplistic terms: this means that consumers are paying more to power their homes so that big tech companies can pay less for power to keep smartphones lit with data. (We will see how tolerant citizens are of this asymmetry in the post-crisis climate.)

Many such realities are, in effect, hidden by the fact that the cloud’s energy dynamic is the inverse of that for personal transportation. For the latter, consumers literally see where 90 percent of energy is spent when filling up their car’s gas tank. When it comes to a “connected” smartphone though, 99 percent of energy dependencies are remote and hidden in the cloud’s sprawling but largely invisible infrastructure. 

For the uninitiated, the voracious digital engines that power the cloud are located in the thousands of out-of-sight, nondescript warehouse-scale data centers where thousands of refrigerator-sized racks of silicon machines power our applications and where the exploding volumes of data are stored. Even many of the digital cognoscenti are surprised to learn that each such rack burns more electricity annually than 50 Teslas. On top of that, these data centers are connected to markets with even more power-burning hardware that propel bytes along roughly one billion miles of information highways comprised of glass cables and through 4 million cell towers forging an even vaster invisible virtual highway system.

Thus the global information infrastructure — counting all its constituent features from networks and data centers to the astonishingly energy-intensive fabrication processes — has grown from a non-existent system several decades ago to one that now uses roughly 2,000 terawatt-hours of electricity a year. That’s over 100 times more electricity than all the world’s five million electric cars use each year.

Put in individual terms: this means the pro rata, average electricity used by each smartphone is greater than the annual energy used by a typical home refrigerator. And all such estimates are based on the state of affairs of a few years ago.

A more digital future will inevitable use more energy

Some analysts now claim that even as digital traffic has soared in recent years, efficiency gains have now muted or even flattened growth in data-centric energy use. Such claims face recent countervailing factual trends. Since 2016, there’s been a dramatic acceleration in data center spending on hardware and buildings along with a huge jump in the power density of that hardware.

Regardless of whether digital energy demand growth may or may not have slowed in recent years, a far faster expansion of the cloud is coming. Whether cloud energy demand grows commensurately will depend in large measure in just how fast data use rises, and in particular what the cloud is used for. Any significant increases in energy demand will make far more difficult the engineering and economic challenges of meeting the cloud’s central operational metric: always available.

More square feet of data centers have been built in the past five years than during the entire prior decade. There is even a new category of “hyperscale” data centers: silicon-filled buildings each of which covers over one million square feet. Think of these in real-estate terms as the equivalent to the dawn of skyscrapers a century ago. But while there are fewer than 50 hyper-tall buildings the size of the Empire State Building in the world today, there are already some 500 hyperscale data centers across the planet. And the latter have a collective energy appetite greater than 6,000 skyscrapers.

We don’t have to guess what’s propelling growth in cloud traffic. The big drivers at the top of the list are AI, more video and especially data-intense virtual reality, as well as the expansion of micro data centers on the “edge” of networks.

Until recently, most news about AI has focused on its potential as a job-killer. The truth is that AI is the latest in a long line of productivity-driving tools that will replicate what productivity growth has always done over the course of history: create net growth in employment and more wealth for more people. We will need a lot more of both for the COVID-19 recovery. But that’s a story for another time. For now, it’s already clear that AI has a role to play in everything from personal health analysis and drug delivery to medical research and job hunting. The odds are that AI will ultimately be seen as a net “good.”

In energy terms though, AI is the most data hungry and power intensive use of silicon yet created — and the world wants to use billions of such AI chips. In general, the compute power devoted to machine learning has been doubling every several months, a kind of hyper version of Moore’s Law. Last year, Facebook, for example, pointed to AI as a key reason for its data center power use doubling annually.

In our near future we should also expect that, after weeks of lockdowns experiencing the deficiencies of video conferencing on small planar screens, consumers are ready for the age of VR-based video. VR entails as much as a 1000x increase in image density and will drive data traffic up roughly 20-fold. Despite fits and starts, the technology is ready, and the coming wave of high-speed 5G networks have the capacity to handle all those extra pixels. It requires repeating though: since all bits are electrons, this means more virtual reality leads to more power demands than are in today’s forecasts.

Add to all this the recent trend of building micro-data centers closer to customers on “the edge.” Light speed is too slow to deliver AI-driven intelligence from remote data centers to real-time applications such as VR for conferences and games, autonomous vehicles, automated manufacturing, or “smart” physical infrastructures, including smart hospitals and diagnostic systems. (The digital and energy intensity of healthcare is itself already high and rising: a square foot of a hospital already uses some five-fold more energy than a square foot in other commercial buildings.)

Edge data centers are now forecast to add 100,000 MW of power demand before a decade is out. For perspective, that’s far more than the power capacity of the entire California electric grid. Again, none of this was on any energy forecaster’s roadmap in recent years.

Will digital energy priorities shift?

Which brings us to a related question: Will cloud companies in the post-coronavirus era continue to focus spending on energy indulgences or on availability? By indulgences, I mean those corporate investments made in wind/solar generation somewhere else (including overseas) other than to directly power one’s own facility. Those remote investments are ‘credited’ to a local facility to claim it is green powered, even though it doesn’t actually power the facility.

Nothing prevents any green-seeking firm from physically disconnecting from the conventional grid and building their own local wind/solar generation – except that to do so and ensure 24/7 availability would result in a roughly 400 percent increase in that facility’s electricity costs.

As it stands today regarding the prospects for purchased indulgences, it’s useful to know that the global information infrastructure already consumes more electricity than is produced by all of the world’s solar and wind farms combined. Thus there isn’t enough wind/solar power on the planet for tech companies — much less anyone else — to buy as ‘credits’ to offset all digital energy use.

The handful of researchers who are studying digital energy trends expect that cloud fuel use could rise at least 300 percent in the coming decade, and that was before our global pandemic. Meanwhile, the International Energy Agency forecasts a ‘mere’ doubling in global renewable electricity over that timeframe. That forecast was also made in the pre-coronavirus economy. The IEA now worries that the recession will drain fiscal enthusiasm for expensive green plans.

Regardless of the issues and debates around the technologies used to make electricity, the priority for operators of the information infrastructure will increasingly, and necessarily, shift to its availability. That’s because the cloud is rapidly becoming even more inextricably linked to our economic health, as well as our mental and physical health.

All this should make us optimistic about what comes on the other side of the recovery from the pandemic and unprecedented shutdown of our economy. Credit Microsoft, in its pre-COVID 19 energy manifesto, for observing that “advances in human prosperity … are inextricably tied to the use of energy.” Our cloud-centric 21st century infrastructure will be no different. And that will turn out to be a good thing.

Google data centers watch the weather to make the most of renewable energy

Google’s data centers run 24/7 and suck up a ton of energy — so it’s in both the company’s and the planet’s interest to make them do so as efficiently as possible. One new method has the facilities keeping an eye on the weather so they know when the best times are to switch to solar and wind energy.

The trouble with renewables is that they’re not consistent, like the output of a power plant. Of course it isn’t simply that when the wind dies down, wind energy is suddenly ten times as expensive or not available — but there are all kinds of exchanges and energy economies that fluctuate depending on what’s being put onto the grid and from where.

Google’s latest bid to make its data centers greener and more efficient is to predict those energy economies and schedule its endless data-crunching tasks around them.

It’s not that someone at Google looks up the actual weather for the next day and calculates how much solar energy will be contributed in a given region and when. Turns out there are people who can do that for you! In this case a firm called Tomorrow.

Weather patterns affect those energy economies, leading to times when the grid is mostly powered by carbon sources like coal, and other times when renewables are contributing their maximum.

This helpful visualization shows how it might work – shift peak loads to match times when green energy is most abundant.

What Google is doing is watching this schedule of carbon-heavy and renewable-heavy periods on the grid and shuffling things around on its end to take advantage of them. By stacking all its heavy compute tasks into time slots where the extra power they will draw is taken from mostly renewable energy sources, they can reduce their reliance on carbon-heavy power.

It only works if you have the kind of fluid and predictable digital work that Google has nurtured. When energy is expensive or dirty, the bare minimum of sending emails and serving YouTube videos is more than enough to keep its data centers busy. But when it’s cheap and green, compute-heavy tasks like training machine learning models or video transcoding can run wild.

This informed time-shifting is a smart and intuitive idea, though from Google’s post it’s not clear how effective it really is. Usually when the company announces some effort like this, it’s accompanied by estimates of how much energy is saved or efficiency gained. In the case of this time-shifting experiment, the company is uncharacteristically conservative:

“Results from our pilot suggest that by shifting compute jobs we can increase the amount of lower-carbon energy we consume.”

That’s a lot of hedging for something that sounds like a home run on paper. A full research paper is forthcoming, but I’ve asked Google for more information in the meantime; I’ll update this post if I hear back.