“60 Minutes” Feb. 21, 2010…Bloom Energy Box - We need more facts from Bloom. 

“60 Minutes” - the February 21 issue of the popular weekly TV magazine presented this week’s technology buzz. It is the Bloom Box (or Bloom Energy box) - a collection of fuel cells (resembling computer diskettes) that Bloom CEO, K.R. Sridhar, believes will someday power the world.

This program article, delivered by Lesley Stahl, gave us an up-close, fingers-on view of Mr. Sridhar’s concept. Ms. Stahl was the first journalist to see a Bloom Box opened up for her and for us to see inside. But for all it’s fascination potential, the article was incomplete. What information is old news, and what key features were left out of the “60 Minutes” program.

Inventor Peter Sumaruck, as consultant, will offer comments from his expertise in New Energy technology. “First thing, my tech isn’t anything like this; it comes from a different place…but fuel cell technology has been around a long time - I know how they work, of course, and what questions to ask…(in the past) it’s always been expensive and not pollution free.” The fuel cell was invented in 1839 

 but it was always temperamental, “like a diva,” so says “60 Minutes.”

I reviewed the Bloom Box invention, when it was introduced by “The New York Times Sunday Magazine” article by Jon Gertner, on October 3, 2008. “(Fuel cells) convert a fuel, like natural gas, into electricity through chemical reaction rather than combustion.”

Mr. Sridhar says this fuel cell is different from most for a variety of reasons, but one is the extremely high heat needed for electric energy to be produced from a reaction of oxygen on one side of the disk and the fuel (natural gas or biofuel) on the other side.

Looking at the Bloom Box - The first public viewing inside the Bloom Energy factory came from pictures in the 2008 Times Sunday Magazine, of disk/fuel cell manufacturing, showing a tall stack of fuel cells in something similar to bakery oven cooling rack. The first film footage was aired on “60 Minutes” as Mr. Sridhar took Lesley Stahl into his factory, opening up one of his boxes. It is the size of an upright freezer. Inside, you don’t see the stacks of disks, but rather what looks similar to a hot water heater wrapped in an energy blanket, tubes and pipes, wires, etc... The unit stood above their heads by a short distance; it seemed not more than 6 ½ feet tall, encased in supposed stainless steel. It looks innocuous but 1000C is very hot.

Key factor - the high heat necessary for operation: Pete Sumaruck says, “What about that high heat they need to use, 1000 Celsius (1832 F). High temperature, requires a lot of energy (spends energy to make energy)…and then it’s always running hot; heat contributes to inefficiency.” Pete asks, “what is the heat for; is he (Sridhar) making steam? What kind of efficiency does he have?” Pete’s power systems consistently run at 100% efficiency. There is never any heat.

Author comment, “They say (on the program) he’s saving about half the usual energy needed...so in other words, is the heat produced for the chemical conversion to take place - however it goes, a very high heat seems to be a byproduct. Can this heat be used also for more power.

More essential questions, “What is the life of this fuel cell, Pete Sumaruck says, “It’s running 24-7, maintaining that kind of (high) temperature…how long does each fuel cell last. Nobody asks that. With that kind of heat, they’d need repair time…there would be downtime without power.

On the day Mr. Sridhar was to make a media statement on his technology, Feb. 24, 2010, The New York Times ran an article, “Bloom Energy Claims a New Fuel Cell Technology.”  The article says, “Mr. Sridhar contends the Bloom boxes, with reasonable maintenance, will have a 10 year life spam.” I put this in quotes because I quoted the Times, so it is the Times saying it, not Mr. Sridhar.

And the content of the statement - What is “reasonable maintenance?” What does that mean? What is the process for more fuel addition. These should not be construed as proprietary questions because it is essential to address the use of fossil fuels and in turn, the definition of “green” technology- at what point does a technology become "green." The public has the right to know how often the box is refueled and the amount of pollution generated.

The Times article says, “devises made by his company were generating electricity at a cost of 8 to 10 cents a kilowatt hour, using natural gas.” Again the quotation marks are mine and do not reflect something Mr. Sridhar actually said.

Pete says, “the going rate in this country is 12 cents- not much of a bargain with Bloom.”

How was Bloom Energy funded - Looking at the Times 2008 article, their focus was on venture capital companies in Silicon Valley, with special attention to the VC company Kleiner Perkins Caufield & Byers, where their other clients are eBay, Google, Netscape, and many others.

The Times article emphasizes, “a typical V.C.’s money swap” (often anywhere from $1 million to $15 million) for an ownership stake (usually from 20 to 40 percent) in a start-up, but now Kleiner Perkins’ investment in Bloom Energy turned out to be “around” $400 million. One can’t help but speculate as to the percentage of ownership Kleiner Perkins has in Bloom Energy.

Al Gore was and is one of the partners in Kleiner Perkins,

 but this important fact is not mentioned in the “60 Minute” piece - that should definitely be mentioned. In fact, the Times article showed a picture of Mr. Gore on its magazine cover, next to a yellow car with other Kleiner Perkins people.

Bloom Box is the first green technology to come under KP’s wing (they chewed on it from 2001, until 2006 before investing). One reason they hesitated was “the (relatively) low price of oil,” at that time; they hoped for higher prices to show a contrast in energy savings using Sridhar’s product. Back in 2008, the thought at Kleiner Perkins was that Bloom could sell “thousands of 5kW size (which he said was enough for one house) or the larger 100kW machines that power buildings or neighborhoods.”

Mr. Sumaruck says, “this statement is confusing; 5kW will not power a home unless it is one small room; a 12kW would power a small house, 2 bedrooms. A 55 kW would power an Army mess tent. A 65kW will power a 3,000. plus sq. ft. home depending on it’s power needs, up to a 5,000, sq. ft. home. A sure thing, 100kW will not power a neighborhood. You have to be realistic.”

Mr. Sridhar took - “his business plan called for making energy generators” - to Kleiner Perkins, though the inventor’s term “generator” is used in a figurative sense, not a literal one - not resembling a generator as one might be accustomed to seeing, but a collection of stacked disks like old computer diskettes. Mr. Sumaruck does power generators but that’s only one of many applications. It could be used instead of a dam on a river to generated power, especially visible since various dams are being dismantled now (see Klamath River article on sfgate.com).

Mr. Sumaruck says, "Yes, I can power a house off the grid...but what people really want is for me to power motors...that means not just a constant power, but power for factories. The drive is resistive, a three phase motor. Energy needs aren't simple. And everywhere, the company cafeteria is going to have different needs from a single office - people in moderate heat, while another may need more AC and power for a lot of equipment.

One of the defining points of truly “green” energy is fuel consumption. Can Bloom break away from using fuel. Kleiner Perkins partner, Aileen Lee in 2008, said Bloom Boxes can be “fuel flexible,”… the boxes can run on, “say, ethanol…and in theory…be reliable, quiet and very low in carbon (60% lower than traditional) emissions,” from the Times article. Bloom wants to say it’s green tech, but it is not pollution free - they won’t say how much.

“What Bloom offers does not seem to be unique,” says Jacob Grose, senior analyst at Lux Research, speaking about emerging technologies. “The real question is whether Bloom has unlocked the secret of how to make these things cheap, I’m very skeptical of that.”

Others are not convinced about the power of the Bloom Box. According to Brainstormtech, Bloom Energy lost $85 million in 2008, “According to VCs who have seen his (Sridhar) business plan,”…“fuel cells are still too expensive“…even with that caveat, this is the beginning of a “full-bore media assault (promotion), by Mr. Sridhar.”

Can Bloom Energy power Google’s Servers - “But the real test,” says Brainstormtech, “is whether Google feels confident enough to use Bloom boxes to power its vast server farms upon which its business depends.”

Author’s comment: I just had to put this in, and give the above quote a line of its own. I have been vocal about this for a long time. We need to have a technology that will power the huge numbers of servers that exist today in the world. Google hasn’t gone “full-bore” yet and turned off their own utility service - they have so much riding on it…they don’t seem to be fully confident yet in Bloom Energy to make that leap.

But take this application of free energy to the entertainment industry: movies to include computer generated pre and post-production - that 3D movie you love, and Star Wars-types; TV productions; games…you can go on and on.

There is a group currently talking about using Mr. Sumaruck’s power system for movie-making. A studio can easily become energy self-sufficient.

Bloom-Google hopes to save maybe half on their usual energy expenses…but why not eliminate those costs altogether, that is the real truth; that is the real technology…that is what is happening right now, but it is not happening at Bloom. And look, Bloom says it is quite alright to speak economic sacrilege on “60 Minutes.” They sanction not using the grid - “build your own grid,” they say…for large companies to power themselves.

Yes, do it but use a technology that isn’t just saving half the cost. That isn’t new technology …that’s only half a technology.

Google is on a PR campaign - Brainstormtech talks about the great PR project: “They (Google) want to let the world know how green they are. ‘How green are you?’ ” Sridhar says. “‘How sustainable are you?’” Grose says, “Even if a company like Google ends up spending more on energy using the Bloom boxes, the positive publicity will more than make up for it.” Maybe you should read that last sentence again.

Some of the comments on brainstormtech are worth reading. One is an excerpt, from Brooksville, FL - Dennis says, “This (Bloom) is useless technology to use fuel that needs to be transported. Better magnetic electric engine technology will be announced shortly to show this as utter waste old rehash. Current investors should cut their losses! If the cost per kilowatt hour of electricity is not under $0.01 this Bloom Box is a joke compared to what is coming.”

Pete says, “I’m not aware of this tech in particular - lots of magnetic-type technology coming along…but we need to welcome any New Energy technology. Competition used to be how America grew, (that’s) how we were world leaders. I hope we can be that way…do that again.” and “the true test of a technology is producing a product; if you don’t have a product, then all you have are words.”

Another comment came from Melbourne, Australia, where Neville Hughes talks about a Ceramic (Bloom uses ceramic power) Fuel Cells product called Bluegen, in final stages of testing. Mr. Hughes says it produces electricity using natural gas fuel at 60 % efficiency…sounds like a product similar to Boom’s box.

How many boxes out in the fields - Sumaruck says, “I tried to count them, the film went so fast…but I got at least 10...10 to 20 boxes…so at $800,000 for each box, that’s $16 million for 20 boxes. That’s a lot of money for each box. Like we said before, one problem with fuel cells - high cost. Charlotte, you count them.”

I watched the film footage again, took special care to count. Yes, “60 Minutes” said “FedEx,” and they said there were “5 Bloom Boxes” …but clearly there were rows of boxes in the film - remember how each box looked when we were up close with Lesley. Also when she was standing next to one, inaugurating a new Bloom box out in the field, we saw what each one looked like. In the picture, there were 20 boxes at FedEx. And too, they showed film footage of Google - again 20 Bloom Boxes, when they said “5.”

Do they think we can’t count. A $16 million dollar purchase for each of these companies. The program said Staples and Wal-Mart were also buyers.

We don’t know what the financial arrangement was. Maybe each of these 4 buyers didn’t pay $16 million but got a “special deal” for the advertising benefits. We know that Kleiner Perkins funded Google as a start-up, and that KP partner John Doerr sits on the board of Google, so it’s likely Google did not pay $16 million for their Bloom boxes. Check out the property of Kleiner Perkins - you go there -they probably have a Bloom box. This will be the new mark of royalty, “Do you have a Bloom Box yet?”

There is only one true Energy Holy Grail - CEO John Donahoe of eBay told “60 Minutes” he too has 5 boxes (or 20?) and he says he saved $100,000.00 on electricity over a 9 month period.

Pete Sumaruck says, “A typical large operation like that (eBay) would spent $¼ million a month on electricity. If eBay saved $100,000 over a 9 month period that’s not much savings at all - nothing to brag about.

What I say is that his electric bill should have been down to “0” (or the minimum to keep a hookup), if Bloom Energy were really doing its job properly. It is possible to not only make power production carbon-neutral, but it is possible to zero out your entire power production cost with the exception of the necessary equipment. Zero is the only power talking point - the only point of pride. Lesley Stahl asks if Bloom is the Holy Grail of energy production. There is only one true energy Holy Grail and that is zero power cost. Can Bloom bring energy generation costs to “0.”

Google is in the energy business, not just consuming energy, but buying and selling - That must have been their original concept back in 2006 (even back to 2001) when Kleiner Perkins and John Doerr decided to fund Bloom Energy and connect it to Google. In December of 2009, Google “formed an energy subsidiary, Google Energy…to buy and sell energy,” February 19, 2010.  Fastcompany.com says this means Google will “probably buy energy credits and sell excess power to the grid (their Bloom boxes make more energy than they need)…but it might mean Google will eventually become a utility.” Remember, Google and Bloom Energy are tight tech partners.

Google wants to be your friendly energy utility, but it may have competition from northern California’s own P.G.& E. (Pacific Gas & Electric) who has now filed for permission to install Bloom Boxes. Look out Southern California - the energy wars begin…but will customers of S. C. Edison want to pay for these wars.

The Times article also says, "One byproduct of fuel cells is water," from this Bloom Energy wants to electrolyze water to make hydrogen to again fuel their cells...makes me think of a dancing bear - is there nothing they can't do. Let's get one product right first before daydreaming.

But this does bring up an important point - what about that water. I don't see big pipes coming out of the Bloom box, carrying water...and again, that high heat, does that just waste off into the atmosphere, along with the CO2.

Time to talk Overunity - Google says Bloom is making more energy than they (Google) need - integral to their plans to be a energy broker…sure, anyone can produce more energy than they need and then sell it back…but can someone put in “less energy” and get “more energy” out and a power-producer that goes on forever. This would be achieving overunity (a definition). And that would be defeating the laws of thermodynamics. Bloom never claims to accomplish this. They are using the old technology of burning fuel to make power.

Pete Sumaruck says, “I make energy without fuel, and I get a whole lot more out than in. More is always better, no matter the situation, no matter the application.”

The above "overunity definition" also refers to it being "perpetual motion." The U.S. patent office maintains a rule of not issuing patents or patents-pending to any invention that relies on perpetual motion as their primary function. Pete Sumaruck has more than 30 patents pending...and he does achieve overunity - has been doing so for 23 years. The patent office obviously recognized that Sumaruck's invention has merit. Why can't the Bloom Box show overunity.

Not the only giant that wants to control energy - Analyst to analyst, Bloomberg New Energy Finance talking to earth2tech.com - “Wall-Mart created Texas Retail Energy” …has been allowed to buy its own power at low cost rates for its warehouses and retail stores. Wal-Mart may seek permission to become a utility.

Pete says, “You know, years ago I was negotiating with Wal-Mart, room full of VPs. It came down to them wanting me to power up one store for free. Then they would take the technology to their other places. Pete meant “take” as in use without compensation.

It’s like when Pete told me about how he had invented a technology that would allow you to go for extended periods of time without recharging your cell phone. At a meeting of Swiss VC’s, they made Pete a proposal: “We will give you a percentage until it starts turning a profit.” He got up and walked out. It seems to be common practice to devalue the inventor…but where would we be without the concept, the inspiration? Columbus would have lived out his life in Genoa and never left home.

With Pete Sumaruck’s power production system, you turn it on today, and it runs for at least 30 years - no fossil fuel needed and no pollution produced.

Mr. Sridhar said his dream was to take his fuel cell power production system back to India to enable farmers far from city grids to have the power they need. But according to the inventor and “60 Minutes,” Bloom Energy is 5 to 10 years away from a residential application.

Lesley Stahl asked what it might cost then - an estimated $3000.00 for the 64 disk collection - not much money to power a small building in America, but perhaps a lot for a farmer in India. So much remains unexplained.

There would be the consideration of how long the Bloom Box would last: would the high heat be a hazard to the community; how would the poor farmer refuel it…or need to buy another and another. That farmer needs a source of energy that will last his lifetime. That power is available now, but Mr. Sridhar doesn’t have it yet.