National Conference on Emerging Market Economies

Earlier last week I attended a conference at Ruia College, University of Mumbai. As the title suggests it was an Economics conference focused on examining the role of Emerging Market Economies in the 21st century. I would like to get into certain details of the conference as here is where I presented my first paper. It is on Environmental Economics, titled : Asia - Potential for Green Economy.

Over the three day conference speakers spoke about issues concerning Macroeconomic Policy, Banking, Finance and Insurance in India, Trade and Investment in India and there was also a panel for Environment and Energy Economics. The opening evening saw Ruia College's two esteemed alumnus - Economist Lord Meghnad Desai and Member of Planning Commission Dr. Narendra Jadhav.

Dr. Narendra Jadhav, speaker of the evening, presented his findings on Emerging Market Economies where he studied all countries with a population greater than 30,000. He spoke about economic literature of emerging economies, coining of term 'Emerging Market Economies' and concluded by raising a question - now that the West is in debt, how and from where will Eastern economies generate income?

That evening I got an opportunity to talk with Lord Meghnad Desai. Lord Desai gave me research direction towards my next paper. In the above mentioned paper I have drawn conclusion by estimating year when India will achieve bend on Environmental Kuznets Curve.

Lord Meghnad Desai

The following two days and specifically lecture by Dr. Dilip Nachane, Emeritus Professor, IGIDR, Mumbai I was introduced to Efficient market hypothesis, Jackson Hole consensus and inverted U relation between  financialization and economic growth. At the panel on Environment and Energy Economics chaired by Mint newspaper Executive Director, Niranjan Rajadhyaksha, panelists included -

Dr. Pushpa Trivedi professor at Indian Institute of Technology, Mumbai spoke about National Income versus National Resource Counting,

Dr. Dinesh Hegde, professor at National Institute of Industrial Engineering, Mumbai spoke about Environment, Energy and Technology Interface and

Mr. Girish Kuber, Executive Editor, Lok Satta newspaper discussed the role of oil in everyday life, economy and cause for political imbalance. 

The valedictory function was a lecture by Economist Ajit Ranade. He spoke about all aspects concerning China's economy. The lecture was very informative and interactive, as audience was dominated by college students. The conference was a success and I am looking forward to pursue research in Environmental Economics. 

Car-Plane, Road Plane or Flying Car...

Twenty two years ago, a modern day flying car was built and operated by a certain Canadian engineer. He revealed that such an idea need not be a concept and flew his M400 at an altitude of 20 meters. Catering to modern day transport dilemma (a growing concern even in 1989) he opined that a vertiport shall provide solutions to urban transport. This is at the cost of rising petrol prices, ear tearing noise levels, safety risks, low fuel economy and a whopping initial market price of one million dollar a car. Paul Moller's Skycar never became legal and imagining someone paying a million dollars on a flying experiment, they would rather spend that on a McLaren.

 In 2004, BBC published an article titled 'Flying cars swoop to the rescue' deriving an alternative use of the car- plane. A resourceful piece from the article - "When you try to combine them you get the worst of both worlds: a very heavy, slow, expensive vehicle that's hard to use," said Mark Moore, head of the personal air vehicle (PAV) division of the vehicle systems program at Nasa's Langley Research Centre in Hampton, US. NASA aspired to develop sustainable means of smaller capacity planes. They aimed to develop technology such that small sized planes would fly as silent as a motorcycle, by 2009. All of this is indicative of efficient alternative source of dual passenger air travel.

Flying Cars of the Past, Present, and Future

 Today, after decades since the thought of a car plane conceptualized and watching Chiity Chitty Bang Bang, a tech firm, Terrafugia, based in Woburn, Massachusetts is on the way to selling its first commercial road plane - Transition. With tests already taken place, this is no concept and aims to go on sale by end of 2012. The model aims at promoting air travel and specifically to those who wish to acquire a pilot’s licence. As the name suggests the model would work as an airplane and an automobile, hereby a pilot would not have to change vehicle during flight or on road. No wonder, already 100 Transition models have already been booked. Overlooking fuel economy of 14.9 kilo meters a litre on land and a range 643 kilo meters in air, companies must pay strict attention to safety measures. 

Transition

 Development in the field of safety standards in air travel, automobiles or "flight-mobiles" in the twenty first century is largely going to advance through sensor technology. We must realize that even though these vehicles are designed to run on petrol, personal air transport is proving to be take form in a big way. The American companies have paved the way and found a practical solution to an alternate source of transport. Hopefully such engineering marvels sustain and are seen in significant numbers in a year from today.

Second Generation Biofuels – Economists and Politicians

In a continuation to the previously mentioned entry about second generation biofuels, over here, I have attached two pages from the same report. 

It highlights a direction for economists and politicians who could take steps towards making biofuel more readily available and acceptable at mass level.

Second Generation Bio-fuels in Switzerland

Earlier this month I was given a synopsis report of Future Perspectives of 2^nd Generation Biofuels. It is a study conducted by Centre for Technology Assessment in Switzerland. Here, I read an interesting piece on various types of 2G or second generation biofuels. It is interesting to learn how science and research is progressing and looking at new and rare means to launch alternative forms of biofuel.

The first thought that struck my mind was really to understand what first generation bio fuels are. It is the conventional production of biofuel through sugar, starch and vegetable oil. There are limits to its contribution as an alternative fuel, as after a certain point it proves a threat to biodiversity and food crops. Also, the economics does not make much sense as it is not very cheap in comparison to oil.

This might look right from the textbook. I hope the accompanied images make this entry an interesting read. The various sorts of second generation biofuels include –

Slurry and Manure – Achieved from raising livestock, this material is very cheap to procure. It is economical and technically possible to produce and is available in large quantities across Switzerland. The country produces 0.1 petajoules of biofuel and has a potential of over 21 petajoules. As a whole, the potential capacity is equal to energy obtained by burning 716,000 tonnes of hard coal.

Organic Waste – Three quarters of organic waste in Switzerland is used to produce energy, 89% in refuse incineration plants and 11% in biogas plants. The only drawback of organic waste as a source of biofuel is that it requires specific plants and technology to process.

Fallen trees – Fuel can be produced through felled round timber, sawmill waste or other timber demolition waste. In 2007 2.2 million cubic meters of total felled timber was used to produce fuel. In the near future this number would rise to 3.1 million cubic meters in Switzerland. Also, the country has a potential capacity of 1.2 million tonnes of waste wood to produce fuel from the existing 1 million. The specific drawback of timber from demolition waste is rigid usage and processing requires large plants with appropriate filters.

Straw – As a raw material, straw is found in small quantities as a whole, across Switzerland. In 2006 the Swiss straw crop amounted to about 58,000 tonnes. It is found in the form of manure in farms and can be directly used to produce biofuel.

Exotics – Miscanthus, a plant which is efficient in photosynthesis and thus highly productive is found largely in the USA. In Switzerland, the climatic conditions make it capable of growing Miscanthus. Once sown, the plant can be used for 25 years. The only drawback is that it has limited flexibility in cultivation.

Miscanthus

Finally we must realize that biofuel is a major potential fuel in automobiles. It is mentioned in the report that “increased vehicle efficiency could substantially improve the outcome for biofuels” also “for efficient vehicle technology to be able to help biofuels to replace a substantial proportion of fossil fuels, lower fuel consumption must not be (over)compensated by more frequent and longer journeys.

Back to Basics

Today is the last day of February, it also happens to be "leap" day, 29th February, 2012.

I would like to conclude this month with two very interesting videos that have caught my eye.

The first video is a GOOD Magazine production. It cites examples of sustainable transport across cities -

This video is part of IBM initiative, TheSmarterCity. It emphasizes on transport working as a collective system -

I hope viewers learn something new out of these two videos.

CityCar to Hiriko

In 1970s, American director Stanley Kubrick began groundwork on a film with a futuristic idea. At that point in time computers failed to produce effective science fiction imagery. He shared his thoughts on the topic with American science fiction director Stephen Spielberg and in 2001, Artificial Intelligence was released. Sadly, Stanley Kubrick had passed away in 1999. 

Another American story sharing resemblance took place on the north-eastern coast. Beginning in 2003, urban designer William John Mitchell developed an idea for urban mobility at Massachusetts Institute of Technology’s MIT Media Lab. The idea was to create “Mobility-on-Demand” service. This was also the year when crude oil prices took off on a four year flight towards energy crisis. Planned as an all electric urban mobility automobile, the CityCar was born as Hiriko in Spain translating to ‘urban’, in 2010.

Hiriko

The 100% electric vehicle is partially a robot. The wheels operate by individual motors making them turn 360 degrees. This enables optimum utilization of road space while parking and has zero radiuses turning circle. Once parked the car folds. The fold enables three such cars to park in place of one midsized automobile. This is a first of its kind in the smart car space. The vehicle is meant for intercity conveyance and has capacity of 120 kilo meters on a single charge. On a trial basis the first 20 vehicles are set for launch in 2013 within Basque. It would begin off similar to the established bicycle sharing programme across Europe; later Hiriko would be sold at mass level.

Hiriko Driving Mobility is a consortium of seven technology companies in Basque, Spain. They have worked in creating the first prototype, released at European Union headquarters in Brussels this January. Massachusetts Institute of Technology is where the initial idea took shape. Though, the creator Mr. Mitchell passed away in June 2010.

His concept of Mobility-on-Demand originated from MIT Media Lab. It fulfils point to point travel within a city. The execution from concept to reality is aimed to benefit those individuals who cannot afford or chose not to own a personal vehicle. Also, it acts as personal public transport for passengers in the city and those who come from outside. The next question draws attention towards supply side efficiency. Within two years from today is it going to be possible to build infrastructure capable to support rising number of electric vehicles? One such project is taking place in France. Mister Vincent Bollore, an industrialist has worked on developing rechargeable batteries for electric cars. The mayor of Paris, Bertrand Delanöe designed Autolib, a car sharing scheme. The Bollore Group has won contract to run Autolib. The ‘Bluecar’ under this programme was launched at Frankfurt Motor Show in 2011 and 3000 such initial launches are going to be supported by 1120 charging stations within the city.

Keeping supporting funds, income earned, retail price and cost of such projects aside its most note worthy to realize that such developments are happening at this point in time. It is a time where oil prices always seem to be auctioned. This has prompted countries to act in a way to prevent energy insecurity. Countries around are the world are playing their role in reducing impact of transport on environment. The innovative means to reduce transport impact is creating new markets in the process, new economics and unimagined heights of scientific progress. I am curious to see what next.

McLaren F1 for Airlines

Depending on the way you see, London Heathrow Airport breaks into the top three slots under World’s busiest airport. With an average of 167,000 international flight travellers daily, the airport is now facing environmental concerns. Due to heavy traffic in the airport, flights scheduled to land emit roughly 600 tonnes of carbon dioxide circulating air borne; this has been revealed by National Air Traffic Services, also what about emissions on ground, while preparing to take off? McLaren Applied Technologies the entity concerned with race strategies for its team has been called upon to design a performance based grid this would change structure of the airport in order to reduce emissions in air and on the ground.

McLaren Applied Technologies

As seen on the track precession is most crucial. Efficiency in pit stop recovery marks brownie points for a team. An entire army of engineers, software scientists, mechanics and the drivers make the team successful in their venture; this army could be on lines with the entire functioning of this airport. The software called Marple developed by Geoff McGrath for McLaren is the proposed system to be used. It simplifies the view of the object in question. The new design produced is based on heavy data collection from NATS. Here, the airport is transformed from its current geometrical shape into an efficient and simplified rectangular design. Improvement in design structure is the name of the game.

A reduction in taxing period, minimizes delays, improves overall efficiency of the airport and as a result reduction of environmental impact of such an airport proves as a model for upcoming international airports. Daily emissions of around 1800 tonnes of carbon dioxide prove as a hazard to this region of London. This model is set to be in complete application by airports around the world in a year’s time. The largest benefits of this design aid are going to be seen in Beijing, Daxing Airport which is projected to have capacity of 120 to 200 million passengers every year.

The Future of Train Travel

My cell phone alarm went off and I switched on CNN, this was some day towards the end of 2011. I had made a note to watch this sustainable transport programme called ‘On the Move’. The most interesting revelation I came across on this show, and it had been long since I had seen something so appealing in the field of future transport, was the work of a London based design house.

Visionary designer and director Paul Priestman of Priestmangoode has proposed concept of ‘Moving Platforms’. It is the definition of next generation rail transport. The creation of moveable docking station asks for whole new model in transport economics. Such is the ideation of future rail transport – no physical railway station, docking port on wheels and single mode of intercity travel.

To define very clearly, ‘Moving Platforms’ works by having a network of city wide trams. The trams act as the physical station where passengers would board, in order to meet with the train of their destination. Although, as the tram is intra city mode of transport what we are really looking at is a cross city travel plan, where the tram links with the train on the border of a particular city before zipping back. The train being a high speed train makes the exchange of passengers by levelling speeds with the tram and proceeds with its journey. The concept works in the same way when the transfer is from train to tram, in order to reach the final destination.

Moving Platforms

‘Dock’ as it is called, is the key word for the revolutionary transit in rail technology. As the tram would act as platform there would not be a need for a physical cement and tar railway platform. There would be immense saving in city space. Infrastructure would be different. There is proposed use of radio-frequency identification. Also there would be fewer crowds at current day major stations.

On the other hand, this project acts as setting for making rail primary mode of public transportation. In time, cabs, busses and rickshaws would phase out. There would be reduction in consumption of oil. There would be a shift in dependence on conventional sources of energy. In order to make this concept into reality various machineries must integrate. World governments must realize the potential in investing in such an idea. Masses must understand the benefits of such change in transport technology. One such example is the investment in HSR by China. They aim to have more high speed rail lines combining all lines in the world by end of 2012.

The economics for such technology could work either way. In conclusion we must realize the need to get off non renewable sources of energy at the earliest. Such a vision might just work wonders.

European Union’s Transport Challenge

As of New Year 2012, Europe has proposed three very wise initiatives in the green transport spectrum –

a)      Levy a charge on foreign airline emissions flying to and fro the Union

b)      Reduce overall carbon intensity of the region by 6% by 2020

c)      Aim to implement total of 10% green fuel for transport sector by 2020 including hydrogen, electricity and biofuels. 

Now, what is the reason for world governments and energy companies to detest such foresight?

Future of European Aviation

There is a thin link between the three goals. Air transport emissions contribute to a total of 2-3% of global carbon emissions. In order to minimise the scale of these emissions the European Union Emission Trading Scheme objectives come into play. Hereby, following a cap and trade system, European transport emissions can be minimized. Foreign airlines would be forced to buy carbon credits. A charge on foreign airline emissions has been taken as an insult by foreign governments. Also, airlines are required to reduce emissions by 3% by 2012 and 5% by 2013. The implementation and inclusion of aviation industry in the ETS would cost the industry four billion Euros by 2020. This is a crucial step as 21% of EU emissions are from the transport sector.

Another objective is reduction in carbon intensity by a certain percentage, this is a little tricky. In order to reduce carbon intensity in all industries there must be minimal dependence on petrol or diesel. The alternative and most sensible choice available to Europe has been found in biofuels. This for sure has made companies such as BP, Shell and the massive Canadian tar sands upset. There has been investment by firms in biofuels. On the other hand, due to heavy dependence on tropical forests for biofuels, Europe has found itself in a maze.

Biofuels are not as green as projected. Targetting 10% of fuels being renewable or sustainable in nature in the transport sector by 2020 remains a challenge. It would be interesting to see the planting of policies in the years to come. European initiatives and results work as an eye opener for the rest of the world.

Beijing Transport Policy

In 2009, the capital of China alone squeezed in 4.7 million odd motor vehicles, largely speaking of private owned automobiles. It is unfortunate that this number will grow to seven million vehicles by end of this year. The high rate of urbanization due to growing economy has resulted in household level expansion. Here, I will list a number of measures the government is going to implement in order to reduce impact of traffic congestion on health and well being. It is interesting to note that in Beijing 70% of population has faced traffic so bad at least one time that they were forced to return back home.

Beijing Traffic Congestion

In 2010 alone the social cost of congestion to residents of Beijing has been between 80 to 190 billion Yuan. The municipal government has targeted the private car owner by making public transit system more attractive. The busses remain the backbone of the city despite low speeds. This is being worked on by introducing additional lanes, smart cards, improved busses, reduced fares, less time consuming bus routes and specific bus lanes. A BRT system would bring eight million additional daily passengers.

If this would not be enough, there would have to be parking fees implemented. It’s only sensible to charge for parking in public space as the owner would think twice before using his automobile. The other way to implement is by making parking fees a law and reducing the number of parking spaces. This would also increase the charges. In the 11^th five year plan there are plans to build 26 Park-and-Ride centres.  On a similar note is to probably implement usage based toll scheme.

The Olympic Games has imposed a car ban in its locality and it was successful. Though it would be difficult impose something similar on a daily basis. Thus since beginning of 2011 the government has introduced a limit on car licenses to 20,000 permits a month. This was at a time when there were five million eligible applications sent across. Shanghai is the only city to successfully implement license plate auctioning. A possibility to devise a policy of one car per family might prove beneficial. Also, non-Beijing residents must own an apartment and get a parking permit before being allowed to buy a car.

Yikatong

All in all these policies are yet not highly successful with growing incomes and private vehicle being sign of status symbol. In my opinion there must be political initiative to make masses aware the ill effects of vehicle congestion. Not only will it affect health but also the very standard of living of the growing middle class.  Beijing Municipal Administration and Communications Card or Yikatong is a means to relax social mindset towards using public transport. It can be used for subway lines, public city buses, Beijing airport express train and also long distance bus routes.

The Traffic Demand Management Policy work in time, for Beijing toppled USA in becoming the world’s largest automobile market in 2009.