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Thursday, January 29, 2009

Wall St. Feeling Downbeat on Solar

Some analysts are taking a dim view of SunPower Corp. (NSDQ: SPWRA/SPWRB), which is scheduled to release its quarterly and 2008 financial figures after the market closes on Thursday.

Jeff Osborne at Thomas Weisel Partners believes the solar panel maker, based in San Jose, Calif., will face tougher times ahead than what SunPower has anticipated. The company already warned investors back in November that revenues for the fourth quarter of 2008 and this year would drop, but attributed the changes to foreign currency fluctuation (see Stocks Stumble After SunPower Lowers Forecast).

The company expects to generate $388 million to $418 million in revenue for the fourth quarter, with earnings of between 24 cents and 31 cents per share and a gross margin of 24 to 25 percent. For 2009, SunPower anticipates bringing in $2 billion to $2.1 billion in revenue, with earnings of $1.68 per share.

In a research note this week, Osborne said the 2009 revenue is like to be even lower. He's reducing the revenue estimate from $1.97 billion to $1.38 billion.

The credit crunch will continue to squeeze SunPower's business, which includes not only making panels but also installing them, Osborne wrote in this week's research note. Uncertainties over the once-booming market in Spain, whose government has significantly downsized its solar incentive program for 2009, does not bode well for the company.

"Despite SunPower being a best of breed solar company which we believe will outperform in a credit recovery, we do not think they are immune from the market turmoil," Osborne wrote.

Mark Bachman at Pacific Crest Securities, meanwhile, doesn't even consider SunPower to be one of the best solar companies around. In a research note this week comparing SunPower to First Solar, another large American panel maker, Bachman said a solar power plant built with SunPower's equipment doesn't necessary perform as well as the company likes to claim.

Bachman made a similar comparison in a previous research note and saw First Solar as a stronger competitor in the marketplace (see First Solar Reaches Grid-Parity Milestone, Says Report).

Bachman lowered his estimate of SunPower's 2009 revenue to $1.8 billion from $2.1 billion.

First Solar (NSDAQ: FSLR), long loved by investors and analysts, isn't immune to Wall Street's bearish outlook. The company, based in Tempe, Ariz., has built a reputation for being able to produce solar panels cheaper than anyone else in the industry.

Osborne at Thomas Weisel Partners has cut his estimates of First Solar's 2009 revenue and production, citing difficulties in gauging market demand this year. He expects the company to produce 837 megawatts worth of panels instead of 975 megawatts in 2009, and the annual revenue to reach $1.72 billion instead of $1.99 billion.

In discussing its third-quarter earnings last October, First Solar executives said they expected to generate $2 billion to $2.1 billion in revenue this year (see First Solar Profits Up 54%, Credit Crunch Could Impact Biz).

In a research note this week, Gordon Johnson at Hapoalim Securities said he believed First Solar's own forecast "could prove out of line with reality." Johnson expects the company's 2009 revenue to be around $1.7 billion at the low end.

In a recent interview, Johnson said First Solar will face tougher competition this year because the price for polysilicon is dropping quickly. Polysilicon is the main ingredient used to make most of the solar panels on the market today. SunPower and Suntech Power Holdings, for example, use polysilicon in their panels.

Polysilicon used to be pricy. With more polysilicon factories coming online, however, the prices are falling quickly (see Polysilicon Prices Head For a Steep Fall). First Solar uses cadmium tellurium instead.

"First Solar has had a cost advantage because it doesn't have to buy polysilicon. But it's going to crash and crash again even harder than Suntech," Johnson said.

First Solar plans to release its earnings on Feb. 24.

U.S. Wind Power has Record '08- but Hard Times Ahead

U.S. wind power grew a record 8,358 megawatts in 2008, an investment of about $17 billion, according to the American Wind Energy Association. But the economic downturn and lack of financing for large-scale projects could make this year far shakier.

Wind power surged ahead in the United States last year with a record-breaking growth of 8,300 megawatts – but the economic downturn may give the industry serious headwinds to contend with in 2009.

That's the news from the American Wind Energy Association, which says last year saw a 50-percent increase in the nation's wind power resources for a total of 25 gigawatts, enough to power approximately 7 million homes.

Last year's growth represents an investment of $17 billion, and made up about 42 percent of the total power-generating capacity the country added last year, AWEA reported. The United States overtook Germany last year to become the world leader in wind power (see U.S. Wind Power Doubles in Two Years and Wind Power Waiting on Transmission-Line Boom).

But last year's record growth came before the economic downturn and credit crisis dried up financing for massive wind power projects, AWEA's CEO Denise Bode said in a prepared statement (see Energy Financing Gone With the Wind and Wind Turbine Shortage Over?).

And like other renewable energy producers, the wind power industry is asking the federal government for help.

"We are already seeing layoffs in the area where wind's promise is greatest for our economy: the wind power manufacturing sector," Bode said. (See Wind Power Joins Solar in Layoff Trend)."Quick action in the stimulus bill is vital to restore the industry's momentum and create jobs," she added.

Wind power projects can receive a tax credit for the energy they produce, and that so-called production tax credit was extended through 2009 in an energy package passed by Congress in October (see Lawmakers Approve Energy Tax Credits, Bailout).

The stimulus bill working its way through Congress now contains language that would extend the production tax credit for wind power for three years.

But wind power developers say that tax credits have become far less useful as an investment incentive, since so many Wall Street banks and other traditional renewable energy investors have lost money in 2008, and thus don't need to offset taxable income (see Industry Groups Call for Changes to Federal Incentives).

But the stimulus bill may help fix that problem by allowing wind power developers to claim investment tax credits in lieu of credits for producing power, along with a possible shift to direct payments to investors in renewable energy – a combination that renewable energy developers are lobbying furiously for (see More Stimulus for Renewables? And Tax Credit Fix for Solar in the Works).

Bullet Arrow January 28, 2009


Smart Grid: Test Customers Give Thumbs Up

Smart grid technology makes at least one person swoon.

My knees buckled when I looked at the meter," wrote a participant in a smart grid trial recently conducted by Silver Spring Networks and OG&E Electric Services. "We had twenty little kids running in and out. The air conditioner was running double time. It's convenient to have the ability to see how much you're spending versus normal times."

The two companies rigged up 6,600 apartments in Oklahoma City with smart meters and thermostats that provided tenants with how much power they were consuming and how much they were spending. One of the goals of the trial was to see whether consumers would actually pay attention to price signals from the thermostat and act on it. (OG&E also used the smart meters to turn service off and open new accounts remotely rather than send out a truck.)

Short answer, they will.

"I was not aware of the 2–7 p.m. rate increase or the 'critical' rate period," said another participant.

Skeptics have questioned whether Americans would change their lifestyle or adjust their air conditioners, particularly when the price changes can be measured in pennies. There have also been concerns about thermostat ennui settling in after the honeymoon period. Gas prices didn't become a concern until it approached $4 a gallon.

The results are good news for the smart grid industry and utilities, which can accumulate data like this to woo policy makers and investors. Pacific Gas & Electric, the large California utility, is installing hundreds of thousands of Silver Spring meters a month.

"There is price elasticity for electricity. If you send people information, they will act on it," said Eric Dresselhuys, vice president and co-founder of Silver Spring.

And here are more comments in response to the trial:

  • "I used to wash clothes and dishes during peak hours. I don't do that anymore."
  • "I didn't know there were different rates during the 24-hour period."
  • "I didn't know that peak usage was so much more expensive than other times."
  • "I didn't know that weekend rates cost less."
  • "The best thing is knowing you are saving and being able to calculate or see the amount you are using in a 24-hour period-being able to explain to the children why they were are not able to use the TV in every room."
  • "[I am] not keeping everything plugged in all the time. TVs, etc."
  • "Lights use a lot of electricity."
  • "I didn't know that fluorescent lights take forever to come on to full power, but burn much cooler."
  • "The air conditioner uses more juice than I thought."
  • "[I didn't know] how much electricity we consumed daily and how weather-dependent it was."
  • "I was pretty oblivious before. Didn't pay much attention. You'd get the bill and say, ‘What the hell did we do?' Now I can at least put my thumb on what kind of costs are involved when your kids are running around."

Bullet Arrow January 28, 2009

Can you go Cheaper than First Solar?

It's the three-in-one solar system.

BrightPhase Energy has cross-bred a skylight with a venetian blind and a lot of solar technology to come up with what could turn out to be a highly efficient energy system for homes or low-slung commercial buildings.

The Photensity contains silicon solar cells rated at about an 18 percent efficiency that convert sunlight into electric power.
BrightPhase

The Photensity (see photo) essentially allows the building owner to exploit the sun in three ways. First, it contains silicon solar cells rated at about an 18 percent efficiency that convert sunlight into electric power. Second, a fluid-filled pipe collects heat from the sun, which can then be used to heat water in the building or run heat-driven cooling systems. A concentrator does double duty by focusing heat for the pipe and light for the solar cells.

Third, because the photovoltaic cells are mounted on separated strips that resemble the slats in venetian blinds, the Photensity also lets light into the building, reducing the need for internal lights.

If you convert the thermal energy (in btus) and the light (measured in lumens) into watts, the entire system produces power for around $1.80 per watt completely installed.

"We are roughly two to three times more energy dense than some of the better PV modules out there," said David Buemi, co-founder and vice president of sales and marketing who added that the company discounts the amount of heat that a customer might use in its calculations.

Granted, that's a best case scenario coming from the marketing guy of the company, but if it's even somewhat close, it rivals the numbers from the best solar makers. First Solar in November said it had managed to drop the price of producing its cadmium telluride solar panels to $1.08 a watt and sources said that the figure has dropped to 75 cents a watt in some of its factories in Malaysia (see ty-milestone-says-report-5389.html">First Solar Reaches Grid-Parity Milestone, Says Report).

But that's just the cost of the modules, which only accounts for around one-third of the cost of a solar system completely installed. A $40 million system for Sempra Generation near Boulder City, Nev. – which consists of 168,300 First Solar panels – costs around $3.17 per watt fully installed, according to a recent note from Mark Bachman, an equity analyst at Pacific Crest.

BrightPhase is part of a small, but growing group of companies trying to break into the market by taking a broader view of solar power. Entech Solar, Distributed Solar Power and Millennium Electric devised photovoltaic units that can also capture heat (see All-in-One Solar Panels and Thermal). Entech plans to sell them to industrial users, such as food processing plants or hospitals, with high power and hot water needs.

Cool Energy in Boulder, Colo., meanwhile, has also released a rooftop Stirling Engine that it says can provide 95 percent of its hot water, 60 percent of its electricity.

BrightPhase effectively is trying to take this one step further by adding in light. Harvesting sunlight, however, can be tricky. If a sun passes over a building, the occupants won't run out of power or heat. Nonetheless, they might get angry about the lack of light in their office

In BrightPhase's overall plan, the lights will be hooked into a network and be turned up and down with the requirements of employees and the sun. Besides being free, sunlight is attractive. A grocery chain, that has examined BrightPhase's system, says that natural lighting (as opposed to something like halogen or florescent) can boost retail sales by 20 percent.

Leaving off the lights works, but there's no guarantee that employees or retailers will leave them off. The sensor/control systems for turning up and down lights as the amount of sunlight increases or decreases, meanwhile, still haven't been perfected. A lost hour of worker productivity can equal the amount of energy you might save in a year with a sensor-enabled dimmer bulb, Konstantinos Papamichael, a professor with the California Lighting Technology Center at UC Davis, has estimated. At a trial in a Wal-Mart, the lighting system wouldn't flip the lights on. The problem? A balloon got lodged near a sensor and convinced the network that perpetual daylight reigned in the store.

Sensors can also be thrown off by white table cloths or people wearing black clothes.

The company, which is currently seeking funds, will try to complete four installations this year.

Bullet Arrow January 19, 2009

Sun: Data Center Efficiency for Everyone

Sun Microsystems Inc. is going to save about $1 million a year on electricity costs at its new high-efficiency data center – and it has a new consulting service for anyone who'd like to find out how the company did it.


That's the gist of Sun's news Monday on its latest high-efficiency data center, this one in Broomfield, Colo. Like Sun's flagship data center in Santa Clara, Calif., and two others in the United Kingdom and India, it combines new equipment and new building power, backup and cooling systems to cut down on the space required, electricity consumed and money spent, both in capital costs and operations.

Of course, Sun – like others seeking to cut power consumption in a business that takes up about 1.5 percent of the country's electricity – used some design features that are becoming standard for data center efficiency, including more efficient power and cooling systems and an uninterruptible power supply from flywheels rather than batteries (see Advanced Data Centers Claims Super-Efficiency).

But the biggest share of power and money savings – about a million kilowatt-hours per month – came from shrinking two older data centers of about 500,000 square feet into a new one about a fifth the size, said Mark Monroe, Sun's director of sustainable computing.

Sun's in-house efforts to cut power consumption will also be available to others looking for advice, he added. Sun is adding corporate strategy, design and construction advice to the list of data center efficiency consulting services it started up about a year ago.

"Running a sustainable green IT organization is a great way to save money," Monroe said. "A lot of these efficiency measures go to the bottom line."

Sun has also been populating its new data c enters with the same energy-efficient servers and storage devices it's selling to customers (see Sun Shoots for Power Reduction in Data Storage).

But the company – known for coming up with innovative ways to keep up with much larger competitors in its industry – is going to have plenty of competition in the data center efficiency business as well.

Back in 2007, Hewlett-Packard announced it would reduce the combined energy consumption of its operations and products 20 percent in the next three years. That same year, IBM announced it would spend $1 billion per year on new products and services for data-center efficiency (see IBM Gives Extra Credits).

But Sun's big push into data center efficiency services for others came as a result of the company's own attempts to save money in the midst of its financial troubles from several years back, said Ken Brill, executive director of the Uptime Institute.

"Sun was in desperate financial straits, and they launched this effort to save money," Brill said. "By refreshing their own technology, that's how they got started."

Monroe didn't dispute this.

"We're in a for-profit business," he said. "We've got to make the best use of our resources." Sun has invested about $250 million in its data center efficiency programs over the past fours years, and paybacks on the investments are typically about a year, he said.

Investments like these will be needed if companies are to avoid what Brill predicted could be "a looming crisis" in data center costs, Brill said.

About $15 billion in new data center space was under construction in the United States last year, he said. If energy efficiency of those new data centers isn't improved, the industry could see energy consumption grow to 100 billion kilowatt-hours by 2012 – and that could cost data-center owners as much as $7.4 billion a year, the U.S. Environmental Protection Agency reported (see Data Centers Could Hit ‘Resource Crisis').

Building more efficient data centers doesn't just save on electric bills, Brill added. More efficient data centers are smaller and use less equipment and power infrastructure, meaning they cost less to build as well – the difference between cutting a $4 million per year electricity bill in half and cutting a $200 million construction bill in half.

Google, which has been making a lot of efforts to cut its own energy use and get others on board, said it's made its data centers more efficient mostly through changes in building infrastructure, rather than in the data center equipment itself.

One way to measure that facility efficiency is with a power use effectiveness, or PUE, ratio. That's a measure of the total amount of power consumed by a data center divided by the amount used for computing. Sun's Broomfield

By comparison, NetApp landed a $1.4 million efficiency rebate from Pacific Gas & Electric last month for a PUE of 1.3 at its Sunnyvale, Calif. data center, and Google is claiming an average PUE of 1.21 for six of its large data centers.

But given that existing data centers also need to be made efficient as well, equipment should be getting a close look as well, Brill said.

And, before getting into more efficient equipment, "The first thing people should do is turn off the stuff they don't need," he said. So-called "comatose" servers that sit idle can make up 15 to 30 percent of a data center's equipment power use, he said.

Bullet Arrow January 26, 2009

Doctor's Spooked by Israeli Weapon

DimeCritics continue to press the case that Israel committed "war crimes" in its war with Hamas, because of the civilian casualties in Gaza. Ironically, many of these wounds may have been caused by a weapon designed to reduce collateral damage. Not that the Israelis admit they have the thing.

We first reported on Dense Inert Metal Explosive (DIME) munitions in 2006. The weapons originated as an offshoot of a bunker-busting program, when it was found that adding tungsten powder to explosives seemed to increase the blast effect over a small area. The powder was acting as micro-shrapnel which only carries for a few feet (compared to hundreds of feet for larger fragments), so the result was dubbed the "focused lethality munition" (FLM) which does massive damage in a small area and nothing outside.

There are a large number of reports from Gaza that suggest this type of weapon has been used, and, unfortunately, caused civilian deaths. There are reports and pictures of victims peppered with small particles, and descriptions which are consistent with very localized blast.

During Noah's trip to Israel, he saw drone footage of an extremely small weapon hitting a car. When it struck — on a road, cutting through a Gaza cemetery — the car didn't go up in a ball of flames. Its roof caved in, with a puff of smoke. The back doors were blown out; the front doors stayed shut.

Erik Fosse, a Norwegian doctor working in Gaza says that the weapon "causes the tissue to be torn from the flesh. It looks very different [from a shrapnel injury]. I have seen and treated a lot of different injuries for the last 30 years in different war zones, and this looks completely different."

According to Fosse and his colleague Mads Gilbert, the weapon typically amputates or tears apart lower limbs and patients often do not survive. It's no more illegal than normal blast-and-shrapnel weapons, but it is a mystery.

The only known focused-lethality munition is a version of the GBU-40 Small Diameter Bomb. The weapon has been sold to Israel; Danger Room reported last month that the Israeli Defense Forces were using it in Gaza. But there are two problems. First, the Israelis seem to have bought the original version, not the FLM. And secondly, as Ares reported, Boeing has stated that it has not made any deliveries of the weapon to Tel Aviv, yet.

Ares speculated that the IDF is using weapons supplied by the U.S. Air Force; a spokesman told the site that "we cannot release sensitive information on foreign military sales."

However, Fosse told Britain's Independent newspaper, "all the patients I saw had been hit by bombs fired from unmanned drones. The bomb hit the ground near them and exploded."

It's just possible that Israel is dropping Small Diameter Bombs from drones, but far more likely that this is a small missile with a DIME warhead. Channel 4 News recently aired footage of Human Rights Watch's Marc Garlasco investigating the site of a number of DIME strikes in Gaza. The damage was very localized — confined to one room in one case — suggesting a much smaller weapon.

It is highly likely that Israel has developed its own version of DIME. In the United States, DIME is also being used for active defense systems to shoot down rocket-propelled grenades and other incoming threats. Because it does not throw shrapnel to any distance, it's much safer than traditional warheads. The Israeli "Iron Fist" interceptor unveiled in 2006 is a similar concept, with small radar-guided projectiles. "Iron Fist uses only the blast effect to defeat the threat, crushing the soft components of a shaped charge or deflecting and destabilizing the missile or kinetic rod in their flight," according to Defense Update. This suggests DIME technology.

One of the often-quoted concerns about DIME — which I mentioned two years back — is the potential for tungsten particles to cause cancer. But it's quite possible that the Israeli version is not based on tungsten, and we will not know until there is chemical analysis. (Just a guess, but something called Iron Fist might well use iron or steel particles).

But why is such a precise weapon, intended to avoid the risk of collateral damage, causing civilian casualties at all? It takes tactics and procedures, as well as technology. I can only quote Marc Garlasco's original comment to me in 2006:

"It is unfortunate that these weapons are being developed specifically for use in densely populated areas which may negate the intended effect."

Photo: U.S. Air Force

U.S. High Speed Trains back on the Fast Track

Highspeedrail_2

After languishing at the margins of federal policy for most of the past decade, passenger rail is moving to the fore as President Barack Obama joins a growing number of states in calling for heavy investment in America's rail infrastructure.

The president's $825 billion economic stimulus package includes $30 billion for rail and mass transit projects; a Senate version specifically allocates $850 million for Amtrak and $2 billion for high-speed rail. It's significant, because Obama has long favored expanding passenger rail service and has specifically called for a rail network linking Chicago with the major cities of the Midwest.

Some aren't waiting for the feds to get with it. California voters recently authorized the legislature to issue almost $10 billion in bonds to begin construction of an 800-mile high-speed rail line linking San Francisco with Los Angeles. Gov. Arnold Schwarzenegger has long argued California must lead the nation to a high-speed future. He and others say bolstering the nation's passenger rail system is faster, cheaper and easier than building more freeways or expanding an already overburdened air-travel system.

None of this surprises Michael Dukakis, who for 30 years has been a leading advocate for mass transit and a national network of high-speed rail lines. The former governor of Massachusetts and 1988 Democratic presidential candidate believes "growth in rail is inevitable" and says everyone — from commuters to automakers — stands to benefit from it, and it will only bolster the economy and help the environment.

Dukakis, who served on the Amtrak board of directors, teaches political science at Northeastern University and is a visiting professor at UCLA, where Wired.com spoke to him by phone about the future of rail in America.

Wired.com: The Bush Administration often was accused of trying to shut down Amtrak, but then last year the president signed a bill doubling the agency's budget over five years. What gives?

Michael Dukakis: I think he knew he didn't have a choice. That bill — which is unquestionably the best Amtrak bill we've ever had — passed with overwhelming majorities in both houses [of Congress], and I think that pushed him to sign. Because up until that point Bush was an absolute disaster when it came to funding rail. At one point he zero-funded it. That's completely at odds with the public mood.

Wired.com: How so?

Dukakis: [Republican pollster] Frank Lutz wrote an op-ed piece for the Los Angeles Times this week. His polling found that 94 percent of Americans want work done on our transportation system. Not just on roads and bridges, but on the larger system. It's undeniable.

Wired.com: The Obama administration has promised more rail and transit funding. Are we going to see things start to happen?

Dukakis: No question about it. This economic mess we're in has actually turned out to be a huge opportunity to invest in transit projects. Despite the concerns out there, I think this is a huge opportunity.

Wired.com: What concerns?

Dukakis: There's worry that the states just aren't ready to move on stuff. They haven't done the planning and the engineering they need to jump into major projects when the funding is there. We have a major construction-management problem in this country. In Massachusetts, the governor wants to build a four-mile light-rail extension using existing right of way [tracks and property that are already in place], and it's going to take six years to complete. How can that be? Chinese and Irish immigrants were laying four miles of track a day on the transcontinental railroad, and that was in the 1860s.

Wired.com: That's a state project. What about the national infrastructure operated by Amtrak? Isn't that separate?

Dukakis: Yes it is, but the two need to be interconnected, the same way the Federal Highway Administration works with state highway agencies. Building a first-class rail network for this country will require close cooperation, and moving forward I suspect we'll see close collaboration between Amtrak's construction and engineering people and their counterparts at the state level.

Wired.com: Let's talk about financing. You mentioned a poll showing 94 percent of Americans favor improving the country's transportation system. When Wired.com wrote a piece calling for an increase in the gas tax to finance mass transit and clean energy, it angered a lot of people. People may want change, but are they willing to pay for it?

Dukakis Dukakis: I raised the gasoline tax in Massachusetts in 1989, and I took a lot of heat for it. But our infrastructure is a mess, in part due to lack of revenue. If you're in public office, every once in a while you need to stand up and say, "We're doing the best we can but we cannot have a first-class transportation system without increasing revenue." There are lots of ways to do that, whether it's tolls or a gasoline tax or finding a way to do it with general revenues. But you’ve got to make the case, and you have to be willing to take the heat.

It's also about government spending priorities. It's absurd to say we don't have money to expand rail. For what we spend in Iraq in a week or maybe 10 days, we could fund Amtrak's ongoing operations as well as make major investments. We spend about $30 billion a year on highways and about $15-to-$16 billion on airports and airline subsidies. We're talking about 6 percent or 7 percent of that for a national rail-passenger system. You're essentially talking about a few billion dollars a year over the course of the next 10 years for a system that we should have had years ago.

Wired.com: What would such a system look like? Would it use existing infrastructure, or will there need to be new right of way?

Dukakis: It depends on what you want to do. If you want to build a European-style 200-mph high-speed system — the kind that California is now committed to — that requires exclusive rights of way. And it probably argues for electrification. That's an expensive proposition.

Wired.com: What are the other options?

Dukakis: We can use our existing rights of way to reach speeds of between 110 and 125 mph. In some cases you'd want to lay tracks alongside what is there so that passenger and freight trains can stay out of each other's way, but most of what you'd need is already in place.

Wired.com: Most people probably aren't aware of that. Most people probably think we'd have to start from scratch.

Dukakis: You absolutely can use what we already have. It's already happening. There's a 10-state plan to connect downtown Chicago to every other major Midwest city within 400 miles using trains that travel between 110 and 115 mph. The whole thing would cost around $7 billion, and the basic proposal calls for using existing right of way.

That $7 billion is half of what it will cost to move forward with the planned expansion of O'Hare airport. Every third flight out of that airport is less than 350 miles. So if you build a regional rail system in the Midwest, you're also helping with congestion at O'Hare and opening slots for longer flights.

Wired.com: Are there other regions where such a system makes sense?

Dukakis: Florida passed and then later repealed a bill authorizing a $20 billion, 200-mph bullet train [connecting Tampa, St. Petersburg, Orlando and Miami.] But for about a billion dollars, the state could have a fast system that uses existing tracks and ties into the national network. That's a fraction of the $2 billion to $3 billion they've spent to widen Interstate 4 from Orlando to Tampa.

Wired.com: A 200-mph train is nice, but pie-in-the-sky at this point ...

Dukakis: Well, it’s not pie in the sky for California, where the people have voted to go ahead with it. Over time, it may make sense to do a similar thing in some parts of the country, but realistically, you get the most bang for the buck by focusing on the 125-mph system we've been talking about. And that could move ahead very, very quickly.

Wired.com: What would it require in terms of rolling stock and other equipment?

Dukakis: It's all equipment we can buy off the shelf, stuff that other countries are already using. It's the level of technology they're using in England, and that's a very good system.

Wired.com: Speaking of Europe, many people argue looking to Germany and France is silly because our population centers are much more spread out than those in Europe.

Dukakis: I've heard that argument a lot. But from the Mississippi River east, we actually look a lot like Europe. There's similar population density and distance between cities. That's why the Southeastern states want high-speed service extended from Washington, D.C., down to Richmond, Raleigh, Charlotte and Atlanta. They know it can work. It's true that in the area west of the Mississippi to California, with some exceptions, these kinds of corridors don't exist. But even there the Amtrak long-distance trains provide a hugely important service, and from April to October, many of them are packed.

Wired.com: The cool thing about traveling by train in Europe is when you get off the train, you can cross the platform and hop on a subway. What do you do in a city like Charlotte or Houston, where those local connections just don't exist?

Dukakis: With the exception of a handful of U.S. cities, we are not where we should be in this regard. But if more investment is made in intercity rail, you'll see local and regional transit systems reconfiguring themselves to improve the connections.

Wired.com: Build the national network and local connections will follow?

Dukakis: That's how it has worked with airports. BART [Bay Area Rapid Transit] now extends to the [San Francisco International] airport. Chicago, Atlanta, and New York have transit connections to their airports, too. If we commit to a first-class passenger-rail system, you'll see local and regional transit organizations start talking about finding ways to connect to it.

Wired.com: What's the environmental argument for trains?

Dukakis: Well, it’s far more energy-efficient and much less dependent on conventional fuels, although with diesel you’re obviously going to be using those types of fuel. But by any measure, you’re carrying far more people with less energy than you would in an automobile or an airplane.

Wired.com: Let's talk about planes. On some routes in Europe where high-speed rail is up and running, and even on the East Coast shuttle routes, airlines have seen their market share drop precipitously. Do you think the aviation industry will fight rail expansion?

Dukakis: I don't. Growth in rail is inevitable, and I think the airlines know it. When the high-speed system was approved in California, there wasn't any evidence that Southwest [Airlines] tried to stop it. With congestion and fuel prices what they are, short-haul air transportation is problematic these days, anyway. In any coherent world, using airplanes to fly 300 miles makes absolutely no sense at all.

Wired.com: Where do the automakers fit into all of this?

Dukakis: I teach with a labor economist named Dan Mitchell. He's bright as hell, and he keeps asking why we're loaning money to the car companies when we could give them a contract for $5 billion or $10 billion and have them make buses for regional transit authorities. That's far more effective than just handing them money, and it keeps their factories running.

Wired.com: The system we've been talking about requires more than buses.

Dukakis: Hey, if a company can build a bus, it stands to reason that they can figure out how to build a street car, right? The cities in this country that are planning light-rail–type systems will need to purchase every stick of rolling stock from a foreign manufacturer. There's no reason our car companies can't make them instead.

Wired.com: You seem optimistic passenger rail is going to take off.

Wired.com: That’s my hope and expectation, but there are things that need to happen. The governors and mayors need to get cracking on the planning and engineering of these projects, so that the money can be put to good use. They need to set up training programs to ensure that they have enough skilled tradespeople. There needs to be a sense of urgency across the board, and it needs to be driven by the federal government.

Wired.com: What’s your part going to be in all this? Think there's a role for you in the new administration?

Dukakis: [Laughs] Not this time. This time I'm just a private citizen adding my voice. I'm anxious to be as helpful as I can.

Iphone App Solves Rubik's Cube in 20 Moves or Less

Now you can use this century's greatest gadget to do battle with last century's most-beloved geek toy.

A new iPhone app called CubeCheater helps you solve the classic Rubik's Cube puzzle toy using a mix of sophisticated algorithms and simple image-recognition technology. CubeCheater sells for $1 in the App Store (here's a link).

Cubesolving

Here's how it works. You take six pictures of your mixed up Rubik's Cube using the iPhone's camera — one photo per side. If you have an iPod Touch, you can also tap in the color combos manually. CubeCheater is able to recognize the placement of each colored square and generate a map of your cube. It then figures out the quickest path to solving the puzzle and gives you a set of easy-to-follow, step-by-step instructions.

It's easy enough for kids to use, too. One of Wired.com's editors gave it to his daughter, and she solved her cube with fewer than 20 moves.

A demo video of CubeCheater in action is embedded below.

Using software to solve Rubik's Cube isn't new — mathematicians have been bending their brains into virtual cubes since the toy's debut in the late 1970s — but the math behind the puzzle-solving continues to evolve.

The current guru of Rubik's computer algorithms is Herbet Kociemba, creator of the open source Cube Explorer software program. Kociemba's solver software is currently used by computer science students at universities to build cube-solving robots, some of which also use a camera and image-recognition tech to figure out the color patterns.

CubeCheater uses Kociemba's algorithm to solve scrambled cubes. The app can also be tweaked to solve cubes with nonstandard color variations. CubeCheater even works in reverse — create a virtual mixed up cube inside the app, and it will tell you how to twist a solved cube to match your creation. Could be useful in making pretty geometric patterns.

New Google Tools Determine if Your ISP Is Blocking BitTorrent

Next time you're dealing with a dreadfully slow internet connection, you can ask Google what's causing the trouble.

The company announced a new open platform Wednesday called Measurement Lab, or M-Lab for short. As part of the initial launch, M-Lab includes three publicly accessible tools, including a tool called Glasnost that tests whether BitTorrent traffic is being blocked, throttled or otherwise impeded on your broadband connection.

Also part of M-Lab's launch are a tool to test your connection's overall speed and a diagnostic tool that will tell you if you're suffering from speed barriers common to last-mile broadband-network infrastructures.

In a post on Google's official blog, the company's chief internet evangelist Vint Cerf says M-Lab was launched to help the academic community. Researchers at institutions like Georgia Tech and Germany's Max Planck Institute have been working on these projects, but they've been hampered by infrastructure problems.

"Unfortunately, researchers lack widely distributed servers with ample connectivity," he writes. "This poses a barrier to the accuracy and scalability of these tools. Researchers also have trouble sharing data with one another."

Artistsc01_logoTo provide a suitable testing environment, Google will roll out 36 servers over the course of 2009. Also, all data collected by the project will be made publicly available for anyone to cite or reuse.

In addition to the three tools launching Wednesday, there are two more currently listed as "coming soon" on M-Lab's site. The first is called DiffProbe, and it's described as network probe that will determine if your ISP is shuffling certain kinds of traffic onto a slower pipe. The other tool still in development is Nano, which will tell you if your ISP is purposely throttling traffic from a particular group of customers, traffic from specific applications or traffic bound for specific destinations.

It's interesting to see Google stepping up into the role of a proactive net-neutrality watchdog. As a company that's banking on the internet eventually being put to use by all of us for everything above the operating system level — applications, data storage and communications — the move makes sense. But rather than push for open, reliable connections in the courts or through legislation, Google is taking the fight to the streets.

For years, ISPs have been notoriously shady about what they're throttling or blocking. The industry needs a healthy dose of transparency. Right now, we're just a bunch of pissed-off users complaining about our Skype calls getting dropped and our YouTube videos sputtering to a halt. But when it comes to placing blame, most of us are in the dark.

Google and the academic institutions its partnered with are empowering users to find out for themselves who's to blame when their service turns lousy, and helping them figure out where to direct their anger. And not just the command line jockeys, but everyone — tools like Glasnost are aimed at novices, the only requirement being a current version of Java.

With access to the data that tools like this can provide, we'll be able to suss out the culprits and force them to own up to the true nature of their traffic-shaping policies.

Illustration: M3Liff@

By Michael Calore Email

Bringing the Bowl to the Troops

Soldier Operating a GBS Receive Suite: courtesy Raytheon

While you're inhaling pigs in blankets and taking tequila shots for each touchdown, take a moment to appreciate the image you're seeing. Not the 52-inch HD screen or the 3D advertisements, but the actual game footage of a frivolous event. In the military, they refer to such images as "moral" content, footage that can help them forget, for a moment, how far they are from home. But while the majority of our military based overseas can rely on the Armed Forces Network for live coverage of the big game, those stationed miles from the nearest network connection need a bit more technology to watch those images.

The Global Broadcast Service (or GBS) is "like satellite TV for the military," said Raytheon vice president Guy Debois. While it will provide a live feed of the Cardinals and Steelers this Sunday, it wasn't the original intent of the technology.

According to Debois, following the first Gulf War, General Norman Schwarzkopf demanded the military develop a new method for transmitting sensitive battlefield intelligence faster without tying up command control channels. Eleven years ago, in cooperation with the Air Force, Raytheon launched the GBS. Troops stationed in remote areas needed only a "receiver suite" that allowed the transmission of large quantities of data. Signals are broadcast from three locations (Hawaii, Virginia, and Italy) that communicate with satellites. The system still delivers sensitive information, along with educational courses, a 24-hour live feed of CNN and, in some cases, live sporting events.

According to Debois, tens of thousands in the military will rely on the technology for game footage. They first started broadcasting the game several years ago, and the coverage has grown each year with more receiver suites, more channels and more satellites in the GBS system. Then entire Pacific fleet of subs and ships watched the game live last year (with no delay) and more are expected to do so this year. With growing bandwidth and multiple channels available, all the necessary data can still be delivered.

"There's dozens of channels, so we won't tie up any command control communication," said Debois. "They can switch from watching the game to the latest classified information."

Remember that next time you're complaining about the amount of commercials.

New Advances in Bacteria Based BioFuels

Eco Travel: iStockPhoto

Biofuel is one of today's ecoconscious buzzwords. Recently, however, the most popular biofuels, like corn-based ethanol, are starting to cause their own set of problems. For example, more and more crop land is being devoted to growing corn for fuel instead of food. This has led to a spike in food prices that is being felt around the world. Palm oil, another popular biodiesel fuel, is extracted from palm trees that grow well in places like Brazil. In turn, Brazilian farmers are clearing huge swaths of land for palm plantations, destroying native ecosystems and emitting dangerous amounts of carbon dioxide in the process. A more ideal solution would be to develop or discover a non-food based plant that could also be converted in fuels. That way, we could have our cars and eat our cake, too.

A cooperative effort among Department of Energy researchers and university researchers in Belgium recently made a discovery that is one piece of this environmental puzzle. They found plant-associated microbes that allowed plants to grow in less-than-ideal agricultural conditions, areas contaminated with industrial chemicals or heavy metals, ie: places where regular food crops could never thrive.

The poplar tree places host to these microbes, which, as a form of bacteria, increase biomass and carbon sequestration, allowing these plants not only to grow on dirty soil, but to grow even faster than they normally do. After an extensive lab study to identify the types of bacteria present in the plant samples, scientists identified Enterobacter sp. 638 and Burkholderia cepacia BU72 as the two bacterial endophytes that led to the most rapid growth. To find out how these bacteria stimulate biomass production despite the averse circumstances, researchers examined the genes, where they found plant-growth-promoting hormones among other contributing gene products.

In the race for cellulosic ethanol (non-food biofuel), participants are still warming up.

"Actual marketplace production of cellulosic ethanol is zero – there's not a gallon being produced [commercially] right now," says Thomas Foust, biofuels research director at the National Renewable Energy Laboratory in Golden, Colo. "But with all these plants coming on line … by 2010 or 2011 we will start to see millions of gallons."

Get ready to pull up to the pump folks, and still have some cash left-over for groceries.

Via:

bnl.gov

nationalgeographic.com

csmonitor.com

Stretchy Electrodes Wire Up Cells


Cell stretcher: This system, made of a stretchy polymer embedded with four microelectrodes, can be stretched by a micromanipulator (the black clamp) to mimic the electrical and mechanical activity of the heart.
Credit: Babak Ziaie

The cells of the heart can be stretched by as much as 100 percent with every beat. But traditional platforms for studying cells are static, limiting researchers' ability to study these cells in a realistic way in the lab. Now researchers at Purdue University and Stanford University have developed stretchable electrode arrays for studying these cells. These arrays should help develop tissue-engineered grafts to repair the damage caused by heart attacks, and could serve as bio-friendly electrical interfaces in implantable devices. They're also being used to study how the mechanical stress inflicted during traumatic brain injury changes neurons' electrical activity over the long term.

The new system, developed by a team led by Babak Ziaie, a professor of electrical and computer engineering at Purdue, consists of a stretchy polymer containing a small array of gold-coated pins. These pins act as microelectrodes that can send and record electrical signals. In the past, the difficulty in designing these electrode arrays has been developing electrical connections for the electrodes that can be stretched without degrading their performance. In the Purdue system, electrical current is carried to and from the electrodes by a liquid metal alloy that flows through channels within the polymer.

The stretchy electrode arrays maintain their electrical properties better than any flexible electrode previously developed. Using a liquid alloy means that resistance to electrical current does not drop when the array is stretched.

This makes them a useful tool for studying and stimulating cardiac cells, says Rebecca Taylor, one of the Stanford researchers working on the project. The heart's muscle cells receive regular electrical stimulation that causes them to beat. They also experience regular mechanical stresses caused by the beating of the tissue around them. These stimuli tell heart cells to keep acting like heart cells, so mimicking them in the lab is an important first step toward engineering tissue to repair the damage caused by heart attacks or congenital heart defects.

Taylor says that the new electrodes make it possible to stretch and stimulate heart-muscle cells in vitro: "You trick them into thinking they're in the heart." These long, beating muscle cells normally lose their shape after about a day in culture, growing still and pulling into small, round shapes. The Stanford researchers' first goal is to use the stretchy, electrically stimulating cell platform to maintain the cells in their normal state. After that, they plan to use the approach to grow patches of healthy heart tissue for reparative grafts.

Another team of researchers, at Columbia University and Princeton University, are using stretchable electrode arrays to study traumatic brain injury (TBI). This kind of injury results from an acute event like a car accident or a battlefield explosion, but the ill effects grow much worse over the long term as cells in the brain react to the injury by changing their gene-expression patterns, and subsequently their electrical activity. So the hope is that better understanding how mechanical stresses lead to molecular changes in the brain could, in turn, lead to life-saving therapies. "The deformation of brain tissue sets into motion cellular signaling cascades that take some time to develop; very often, that's what kills you," says Barclay Morrison, a biomedical engineer at Columbia. Morrison is studying TBI in the lab using stretchable electrodes developed by Sigurd Wagner, a professor of electrical engineering at Princeton.

In Wagner's electrode arrays, thin gold electrical contacts printed using standard lithography techniques play the same role as Ziaie's liquid alloy contacts. These electrodes do experience a spike in resistance when stretched, but this lasts less than a second, says Morrison. The stretchiness of the electrodes allows the Columbia team to inflict TBI-like mechanical stress on neurons grown in culture, and monitor their electrical activity over the long term.

"One of the big issues right now in TBI is that we aren't sure of the thresholds of injury," says Kevin Kit Parker, a U.S. Army Reserve captain and a biomedical-engineering professor at Harvard University. Electrodes like those being developed by Ziaie and Morrison "would allow us to precisely determine what kind of blast forces are required to acutely disrupt the electrical activity in the brain," Parker says.

Morrison says that his studies have shown that TBI-like damage can be initiated in cells grow in the lab by a 10 percent strain inflicted over 50 milliseconds. In a forthcoming paper to be published in the Journal of Neurotrauma, he and Wagner describe the effects of simulated trauma on cells from different regions of the brain. "We've shown that, depending on the brain region, cell death is responsive to the rate and magnitude of stretch," says Morrison.

Over the long term, the researchers hope that stretchable electrode arrays will prove suitable for more than just studying cells, and can be used to make implantable devices for studying and treating disease. Morrison says that stretchable electrodes may prove friendlier interfaces for neural prosthetics that connect to the brain, such as implants that allow quadriplegics to control their wheelchair or use a cursor on a computer screen just by thinking about it. Because these implants are flexible, they ought to cause less scarring than a rigid silicon chip. Scarring interferes with the performance of an implant.

Stretchable electrode arrays also show promise as an electrical interface to other kinds of muscle. A compliant electrode array wrapped around the smooth muscles of the bladder might be used to send electrical signals that allow the muscle to move again, helping to treat patients suffering from incontinence.

By Katherine Bourzac

Predicting Breakdowns- A new system that monitors the health of vehicles could save money and lives.


Performance evaluation: Researchers at Rochester Institute of Technology (RIT) and Lockheed Martin have developed a system that monitors and assesses the health of a vehicle and predicts its future performance. The vehicle, such as the military light-armored vehicle, is embedded with sensors that send information to a computer at a central operational center. Shown here are Dave Keegan (right), an RIT student, and Bob Kosty, a technician, looking at the software that analyzes the data to determine how the equipment is functioning and warn of any potential problems.
Credit: Laura W. Nelson, RIT

Most new vehicles are studded with hundreds of sensors that collect raw performance data. While beneficial, such information can only be interpreted by the manufacturer or dealer and is usually only read after the car breaks down. Now researchers at Rochester Institute of Technology (RIT) and Lockheed Martin, a security company in Bethesda, MD, have developed a monitoring system that can better assess the health of a vehicle and can alert drivers to any potential problems.

The system uses a network of embedded smart sensors that are strategically located near automotive components that are prone to problems. The information is sent wirelessly to a central command center, where it is automatically analyzed by software. The monitoring system is similar to OnStar, an in-vehicle security, communications, and diagnostics system built by GM. But Nabil Nasr, assistant provost and director of the Center for Integrated Manufacturing at RIT, says that the system goes "far beyond" anything commercially available by predicting "future health or failures."

The project is part of a $150 million contract between Lockheed Martin and the U.S. Marine Corp, which is equipping up to 12,000 military vehicles with the new technology. The system can assess the health of military vehicles before they are sent on missions so that commanders can know if a vehicle is up to the task. "It could save money and lives, and extend the lifetime of equipment," says Nasr.

The technology has also been tested in a public-transit bus at the Rochester Genesee Regional (RGR) Transportation Authority for the past 18 months. Eight months ago, a spinoff company called LIBAN formed to develop the technology for commercial fleet vehicles.

The system uses standard sensors--such as temperature, vibration, and electronic sensors, as well as customized smart sensors--to monitor a vehicle. The sensors are placed near different components on the vehicle, such as the transmission, alternator, and drivetrain. "Most systems on the market today are just reporting fault codes coming out of the engine-control module. We are looking at data from individual components to get better details . . . and to predict future conditions," says David Chauncey, CEO of LIBAN.

The data from the sensors is processed by an onboard computer system that analyzes the information. That data is sent at regular intervals to a control center via a cellular network, satellite, or private data network, depending on the customer. "Every vehicle is an intelligent, potential source of information, and we have the technology to make the data useful; we just need to develop communication protocols and standards so we can build the infrastructure to share information, beyond just the manufacturers and dealers," says Kirk Steudle, director of the Michigan Department of Transportation (MDOT), which just announced a partnership with Michigan International Speedway to create an open testing environment for cross-brand vehicle communication.

The "heart of the system" is the data-monitoring software, says Nasr. The RIT researchers have created sophisticated programs for mining, trending, and analyzing the data from the sensors. "The algorithms are extremely valuable because they help us build a model of predictive and condition-based maintenance, so we can predict failures before they occur, and we can make determinations about service based on the actual conditions of the equipment," says Randy Weaver, advanced-technology-systems program manager at RGR. The fare box on a bus, for example, is a key piece of hardware that the system monitors. "It's the number-one reason we change a bus off," says Weaver. If the box becomes jammed, transit personnel cannot accept fares from magnetic-pass holders (smart cards), so it is imperative that transit authorities know in advance the condition of the box.

"The [technology] is critical because our primary service is to keep buses on the road for the community, so if we can prevent a road breakdown during service hours, then the technology pays for itself," says Weaver. RGR plans to integrate the technology into its fleets in the next six months.

Steve Underwood, director for the Connected Vehicle Proving Center at the Center for Automotive Research, in Ann Arbor, MI, says that the technology is really important, especially for reducing costs, and that there is a lot that can be done in addition to measuring the performance of a vehicle. Sensors can be used for incident detection, as well as for identifying traffic patterns and pavement conditions.

While the technology is currently being placed in military light-armored vehicles, LIBAN hopes to also use it in commercial vehicles, such as trucks owned by the U.S. Department of Defense, private-fleet operators, freight haulers, and other public-transit systems.

By Brittany Sauser

Digging Deeper in Web Search


Credit: Technology Review

One of the hottest frontiers in Web search is finding ways to improve results based on the searchers' preferences. Already, when you log in to Google, the search engine tries to personalize results by mining your search history: for an eighth grader who has performed lots of searches on marine life, a search for "dolphins" might provide more results for the animal than for the football team.

Now Surf Canyon, a startup based in Oakland, CA, is adding its own spin on personalization. Its software, which can be downloaded and installed into Firefox and Internet Explorer Web browsers, enhances individual searches on major search engines by evaluating which links you click on, and then instantly giving you revised search returns--including three sites that relate in some way to the site you clicked on. "We have invented real-time personalization," says Mark Cramer, CEO of the company.

For example, a Google search for "thermoelectric cooler" using Firefox with Surf Canyon installed provides 10 standard results. In my case, the eighth result, from freescale.com, a chip maker, seemed promising. I clicked on it, scanned the page, and then hit the "back" button. When I subsequently looked at the results page, three new suggestions appeared directly under the freescale.com result. Surf Canyon had elevated these links from the earlier 100 pages of results because its algorithm determined that these recommendations related to the information on freescale.com, including technical explanations of how thermoelectric coolers work.

Crucially, these new results are cleverly slipped into the search results so that the original results page doesn't look drastically different when a user navigates back. It would be off-putting to users, Cramer says, if they had seen a link in the original results that they wanted to click on but, when they went back to the results, found it missing. Therefore, recommended results only appear automatically below the link that was clicked on. "We don't want to jar the users," Cramer says. "[Surf Canyon is] specifically engineered to be as unobtrusive as possible."

Behind the scenes, an algorithm makes the personalization possible. Among other things, the algorithm analyzes which results are clicked, which are ignored, and how much time a user spends looking at the page. Importantly, says Cramer, the algorithm semantically deconstructs a page to determine what it means and how similar it is to others in the results. The results are cumulative: after a couple of clicks, the algorithm can determine if you're most interested in a Canon camera, an SLR camera, or, specifically, a Canon SLR, Cramer says.


Results revealed: A Google search for “thermoelectric cooler” returns 10 standard results. After clicking on the first result and then clicking back to the results page, Surf Canyon shows three suggested results below the first one.
Credit: Kate Greene

Marti Hearst, a professor at the School of Information at the University of California, Berkeley, says that Surf Canyon succeeds in presenting the reordered links in a clear, useful, and unobtrusive way. It doesn't require people to do any extra work, as does Google's WikiSearch, a feature that lets users personalize their results by voting them up or down.

However, in her test cases, Hearst found that the algorithm's re-ranked results weren't completely useful. "Where personalization works is where queries are ambiguous," she says, but queries have become increasingly longer over the years, and they tend to provide clues that help the engine disambiguate the results on its own. Additionally, in Hearst's tests of Surf Canyon, she found that it only untangled the different meanings of the acronym ACL (which could mean both anterior cruciate ligament and Association for Computational Linguistics) to a certain point: it kept including mixed results even when she felt that her clicking choices had made it clear that she was interested in the linguistics group.

Cramer and his team say that they have gotten more positive results. In a study they performed, some participants saw a second page of search results that were reordered according to Surf Canyon's algorithm, while others saw a second page with standard results. The researchers found that the participants who had access to reordered results clicked on them 30 to 40 percent more frequently.

By Kate Greene

Homebuyers Get a Bonus in the Stimulus Bill

NEW YORK (CNNMoney.com) -- If you're thinking of buying a home, there could be a big bonus for you in the economic stimulus bill that's now before Congress.

Among its many provisions is a $7,500 tax credit for first time home buyers. The House passed the $819 billion stimulus plan, including this tax credit, in a vote late Wednesday. The Senate may vote on its version of the bill some time next week.

Technically, the stimulus bill is actually changing the terms of the $7,500 tax credit that was issued as a part of the Housing Recovery Act, which Congress passed last summer. That legislation required that the tax credit be repaid over 15 years, making it more of a no-interest loan. Not surprisingly, the measure had little impact on the market. The stimulus bill now under consideration would make that tax credit a true credit that doesn't need to be repaid.

Many in the housing industry believe this credit could do a lot to jump start the moribund housing market.

"Our economists have studied the effect [of the credit] and they say there could be a 10% increase in home sales if it's implemented," said Mary Trupo, a spokeswoman for the National Association of Realtors. "It gives people who are sitting on the fence or who have inadequate funds for closing costs an incentive to act now."

A 10% increase would yield an extra half million sales this year.

Who qualifies

To be eligible, buyers cannot have owned a home for the past three years, and the new home has to be used as a primary residence. The credit phases out as income rises above $75,000 for singles and $150,000 for couples, and disappears entirely at $95,000 and $170,000, respectively.

Applying for it is easy, or at least as easy as doing your income taxes. Just claim it on your return. That's it. No other forms or papers have to be filed.

Both the Senate and the House versions of the new act remove the requirement that buyers repay the credit. The Senate bill applies retroactively to any purchase completed between January 1, 2009 and the end of August. The House version is also retroactive to the start of the year, and expires at the end of June. As long as buyers don't sell for at least 36 months, they keep the money.

And the credit is refundable, meaning that it can be claimed even if the amount of the credit earned exceeds the buyer's tax liability. So even if your total tax bill comes to just $5,000, you can still qualify for a full $7,500 refund.

The housing industry has been pushing this idea for many months, arguing that first-time homebuyers are the key to boosting home sales. First time buyers who purchase from existing homeowners free those sellers to trade up to bigger, better houses.

Buyers beware

But the credit has its drawbacks, according to Bob Williams, a spokesman for the Tax Policy Center, which gave it a mediocre C+ grade in its Tax Stimulus Report Card. Williams points out that buyers should beware that they won't actually receive any refund for a home purchased this year until after they file their 2009 income taxes in April 2010.

And he argues that the credit is poorly targeted because it goes to every first-time buyer, not just the ones who wouldn't buy without it. So, it merely provides a windfall for many people who would have purchased anyway.

And in the end, a $7,500 tax credit, regardless of the details, does nothing to address the issue that's holding most buyers back - the suspicion that prices are going to keep falling.

"As long as people are uncertain about what markets are going to do, this won't help much," said Williams. "It's not enough to change that."

The industry would like to make the tax credit stronger by making it available to all homebuyers, not just first-timers. And it's pushing to have the credit last through the end of the year, at least.

"By the time it's implemented," said Trupo, "there could be very few months left to act.

New Home Sales Plunge to Lowest on Record

NEW YORK (CNNMoney.com) -- Sales of newly constructed homes plunged in December to the lowest level on record, going back to 1963, according to a government report released Thursday.

The U.S. Census Bureau reported that new home sales fell to an annual, seasonally adjusted rate of 331,000 in December. That's down 14.7% from a revised 388,000 annual rate in November.

The December sales pace was 44.8% below the same month a year ago, when the annual rate of new home sales was 600,000.

Additionally, last month's sales pace was much lower than the consensus estimate of 400,000, according to economists surveyed by Briefing.com.

Sales are typically slow around the holidays. "This is horrible, but note that December always sees activity drop sharply," said Ian Shepherdson, Chief U.S. Economist of High Frequency Economics, in a written research note.

Tough competition

But there are also larger, more daunting forces at work. The problem that builders are facing is dirt cheap competition from existing, foreclosed homes.

"You have foreclosures rising and when banks foreclose, they sell those houses at rock bottom prices, and builders just can't compete in that market," said Patrick Newport, economist with IHS Global Insight.

The problem is very acute in the West - in particular Arizona, California and Nevada - where home prices have plummeted the most and the foreclosure rates have spiked the highest.

While the number of new homes sold plunged in December, the number of existing homes sold in the month showed a surprise jump, according to a report released earlier in the week. But that bump is largely attributed to a flood of foreclosure sales.

The number of existing homes sold in December rose 6.5% from the previous month, to an annual rate of 4.74 million units, according to a report released Monday from the National Association of Realtors. Plunging home prices - especially extreme foreclosure bargains - brought buyers back into the market. Still, total 2008 sales were down 13.1% from 2007.

The median sales price of new homes - which measures the price at which half of the homes sold for more and half sold for less - was $206,500, down 9% from $227,700 a year earlier. The average sales price was $246,900, 13% lower than the $284,400 average of a year earlier.

At the end of the month, there were a seasonally adjusted 357,000 new homes for sale, which represents an inventory level of 12.9 months at the current sales pace.

For all of 2008, 482,000 new homes were sold, down 37.8% from the year prior. In 2007, 776,000 new homes were sold, according to the report.

Elevated inventory levels of both new homes and existing homes will continue to put downward pressure on new home sales.

"With so many homes for sale on the market, it doesn't make sense for builders to build another home because he can't sell it and make a profit on it," said Newport.

Ford Reports $5.9 Billion Dollar Loss for 4th Quarter

Ford Reports $5.9 Billion Loss for Fourth Quarter 2008

Although Ford is the only American automaker currently not operating with the federal loans, it is not faring the economic downturn much better than its rivals. It posted a $5.9 billion loss for the last three months of 2008-$3.1 billion more than it did for the same time period last year.

"Ford and the entire auto industry faced an extraordinary slowdown in all major global markets in the fourth quarter that clearly had an impact on our results," said Ford CEO Alan Mulally. Ford posted a net loss of $14.6 billion, compared to 2007's $2.7 billion loss.

Despite a $1.83 billion monthly cash burn rate during the fourth quarter, Ford CFO Lewis Booth said it expects to burn less cash this year. "We look at our burn rate every day," Booth said. "We are confident that our burn rate will substantially slow in 2009, including in the first quarter."

Ford will draw on $10.1 billion of its $10.6 billion in credit lines today. The money is expected to arrive Tuesday, and will put Ford's cash reserves at $26 billion, discounting what it spends in January. It does not expect its North American operations to return to profit until 2011, but it also has one of most optimistic outlooks for 2009 sales among automakers.

Source: Automotive News

Porsche Updates 911 GT3


Porsche 911GT3
Porsche 911GT3
Porsche 911GT3


STUTTGART, Germany — Porsche's redesigned 911GT3 will debut in early March at the 2009 Geneva Auto Show and will go on sale later this year in Europe. The automaker has announced U.K. pricing, which will start at $116,500.

Engineered for the racetrack and the street, the new 911GT3 boasts a larger, 3.8-liter six-cylinder engine. The normally aspirated flat-six gets a boost in output, to 429 horsepower, thanks in part to improved cylinder-head gas flow and adjustable VarioCam camshafts.

The car sprints from 0 to 60 mph in less than 4.1 seconds and can reach a top speed of 194 mph.

On the new 911GT3, the Porsche Stability Management system enables the driver to deactivate the stability control and traction control in separate steps at the touch of a button. The Porsche Active Suspension Management gets stiffer springs and stabilizer bars, and the car features lighter wheels with ultra-high-performance tires. Brakes have been upgraded, and Porsche Ceramic Composite Brakes are available as an option.

Porsche also offers several track-oriented options, notably active engine mounts, as well as an optional front-axle lift system that provides additional ground clearance on bumpy roads. An optional aerodynamics package bundles modified air intakes and outlets with LED taillamps and bi-xenon headlamps.

Inside Line says: It's what's under the skin that matters most to the friendly folks in Zuffenhausen. — Paul Lienert, Correspondent

The 600hp Club- Which Would You Choose?

Remember when 600 horsepower was the province of pure racing cars and dragsters? Even the biggest and meanest late-'60s' muscle cars topped out at somewhere between 390 and 500 bhp. And those cars were thought to be right at the edge of driveability, shuddering monsters that went sideways and hit things if you got a little too happy with the throttle.

Cars like this faded away in the early '70s, like dinosaurs caught in a meteor shower of gas station lines, safety legislation, emissions laws, recession and high insurance costs. They put their tails between their legs and slunk off to their lonely caves, apparently to be seen no more.

Then dawned the '80s, and horsepower started creeping back. Fuel got cheaper and Americans suddenly rediscovered fun. ("What do you mean, convertibles are unsafe? Whose life is this, anyway?") Meanwhile, a decade of emissions research helped engine labs find more power — and more manageable power — in smaller beakers of gasoline. Horsepower and efficiency have been on the upswing ever since.

And now, here in 2009, we suddenly find ourselves able to gather together no fewer than six luxury GT and sports cars that are able to produce 600 or more horsepower.

No one, in 1973, would have predicted such a thing. We thought we'd all be commuting on hydrogen-powered unicycles by now, and dining on seaweed. Further proof that the only thing we ever know about the future is that we don't know anything. Just ask my stockbroker.

And now these cars...

A cynic — or simply an alert realist — might point out that some of the same conditions that killed off those '70s' muscle cars are back today — along with a consumer mood that discourages throwing brandy tumblers into the fireplace. Depending on your alarmist tendencies, we are either living through the Last Days of Babylon or the Golden Age of High Performance. Maybe some of each. Either way, these are six great cars worth driving and examining.

To wring them out, we spent three days on the road, driving from our Newport Beach offices up into California's Coastal Range around the little towns of Buellton, Solvang and Los Olivos — the scenic wine country where "Sideways" was filmed, forever raising the price of Pinot Noir, not to mention food and lodging, in this area. Nevertheless, armed with company credit cards, we pressed onward in our research.

This is not a comparison test, but more a survey of how these cars drive — and how they put all that power to the ground. I doubt anyone is really undecided between, say, a Lamborghini Murciélago LP640 and a Mercedes-Benz SL65 AMG. Car buffs in this high-end market tend to have their personal tastes well channeled. Still, it was interesting to see how these cars struck our staff, and we all emerged with our own — sometimes unexpected — favorites. Here, in alphabetical order, are the cars:

Bentley Continental GT Speed

Mesmeric, I believe, is the word. If there was one car here that caused photographers and art directors to linger a little too long in the fading light of evening, shooting just one shot, it was the Bentley. The shape is somewhat understated in this crowd, yet it somehow defines quality and the spirit of speed in a way few other cars can manage.

The interior is nice, too — beautiful two-tone soft leather seats and dash in red and charcoal, classically simple instruments and just enough chromed fiddly knobs to remind you this car comes from the same country that made the plumbing fixtures at the Savoy. Very British, without being stuffy.

All this elegance adds up to a 5170-lb. chunk of a car, but fortunately it comes with plenty of engine. The twin-turbo 6.0-liter W-12 (two narrow angle V-6s with a shared crankcase) feeds 600 bhp through all four wheels and moves this solid, vault-like mass down the road with silken ease. The VW-designed engine is turbine-smooth, mated to a 6-speed auto­matic transmission that can be paddle-shifted in either Normal or Sport mode. Turbo effect is essentially invisible, and the W-12 produces deep reserves of irresistible power, like an ocean wave. This is a "How fast do you want to go?" car. Just depress the accelerator and your orders will be quietly carried out.

But not too quietly. Wind and road noise are nil, but the exhaust has a nice snarl under acceleration and a wonderful throaty thrum on the highway, as though the car were powered by the world's largest tuning fork. Steering is light and neutral, and the VW/Audi awd system seems to have no noticeable effect on steering feel.

Handling is crisp and precise on mountain roads, and the Bentley is surprisingly nimble for such a well-padded luxury car. There's a bit more body roll than on some of the low, pure sports cars in this group, but the car can be hustled along at remarkable speed, with very little drama.

There's good interior room, the seats are supportive and comfortable ("offering more adjustment than a chiropractor," as one editor noted) and the ride is nicely damped without being harsh. When you're traveling, the Continental GT is simply a great place to be. A place that goes from 0–60 in 4.0 seconds, hits the quarter mile in 12.5 sec. and costs $199,900.

Elegant, refined, understated and very fast. You could easily live with the Bentley as an everyday driver — and then experience something very close to the outer limits of usable performance on your next road trip.

Chevrolet Corvette ZR1

You might say the automotive world is schizophrenically agog over the ZR1 right now. Half of us can't believe any Corvette could cost $102,450 and the other half can't believe you can buy this much technology and performance for "only" $102,450.

I subscribe to the second view, even if I don't have that much money to spend on a car. Or on anything else, now that I think about it.

Corvettes have always been pretty good at generating numbers, and this one produces 638 bhp at 6500 rpm and a stunning 604 lb.-ft. of torque at 3800 rpm, all from a supercharged 6.2-liter pushrod V-8. It weighs only 3325 lb. and reaches 60 mph from a dead stop in just 3.3 sec. and goes through the quarter mile in 11.4 sec. at 125.5 mph. Just a tick slower than the Ferrari 599 in the quarter mile (at about one-third the price) but it generates more grip on the skidpad and gets through the slalom faster.

But the best thing about the Corvette's impressive numbers is that it generates them so nicely. The engine is almost as smooth as the Bentley's W-12, with a pleasing "on-song" exhaust note at cruising speeds, and when you put your foot in it the supercharger comes in with a whine reminiscent of one of the great '30s' GP cars. Best of all, it makes big torque and power everywhere, at all times.

Suspension compliance with the Magnetic Ride Control system is excellent — not quite as fluid as, say, the Lambo's — but the system's pitch and yaw control provides tremendous grip and very good feedback for the driver. When set to Sport, the suspension stiffens up slightly but remains surprisingly civilized — less jarring than the more track-oriented Z06.

Steering feel is also nicely weighted and quick, for a lively, nimble feel in tight corners. The car is highly tossable, and probably more fun under 100 mph than any car here. Perfect pedal position and a slick, quick-shifting 6-speed manual transmission make you feel instantly at home in this car, as if you could get away with almost anything. Excellent, highly adjustable seats add to that one-with-the-car sensation.

In a way, the Corvette is the most "conventional" car here — a front-engine, rear-drive, 2-seat sports car with a standard transmission and clutch, a standard-spec sports car that just happens to have an incredible engine and highly refined suspension. There's nothing exotic or fussy to restrict day-to-day usefulness of the car; it's immediately as comfortable and familiar as your favorite pair of running shoes (if you could run about 200 mph). It's that very familiarity — combined with an engine whose role in life is providing unlimited wish fulfillment — that made the ZR1 one of our favorites on this trip. It might just be the best "regular" sports car ever made.

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Dodge Viper SRT10

If the Corvette ZR1 revels in new science, the Viper SRT10 goes in the opposite direction and catapults the driver back into the sights, sounds and sensual pleasures of the muscular, knock-off-the-crap Sixties. This is a car for people (i.e., nearly all of us) who missed a chance to buy a Cobra Daytona Coupe — and drive it to breakfast. The Viper is about as subtle as a punch in the mouth, but a lot more fun.

This is not to imply that the car's hard-hitting honesty is technically archaic in any way — only that a thematic choice has been made. And when some modern marvel — such as dynamic stability control — seems superfluous to the Viper's rugged personality, it's simply deleted. This is a car you drive with the human brain and foot — though it's more fun if you favor the foot.

Especially when it's connected to an 8.4-liter V-10 rated at an even 600 bhp at 6100 rpm, with 560 lb.-ft. of torque on tap at 5000 rpm. Not as uncannily smooth as the Corvette's watch-like V-8, the Viper V-10 gives you the visceral impression — and sound — of big pistons hitting hard, with each combustion stroke carrying the car a fair distance down the road. Some of that big-bang sensation comes from very tall gearing. You could drive this car all of your life in the first four gears without much inconvenience. In 5th and 6th the car is just idling at legal highway speeds; it wants to go at least 100 mph, and then just keep going. Like a fighter after takeoff, it isn't meant to stay in the traffic pattern. As ex-racer Steve Millen said in an earlier test, "the harder you run it, the better it is."

Unfortunately, you can't drive real fast all the time — especially with the CHP stalking your fancy little train of supercars — and the Viper is noisier and rougher riding than the other cars at cruising speed. There's a radio and a CD player, but why would you try to listen to them over that great brutish engine note, even if you could? The Viper is an uncompromising sports car meant to be driven hard as a form of entertainment in itself.

An ideal cross-country GT car it's not, but on the twisty back roads it works pretty well. Grip is excellent — if a little busy over mid-corner bumps — and the balance is good. Steering kickback is less filtered than with the other cars, but there's a satisfying sense of driving the car with your own seat-of-the-pants instincts. It'll generate over 1.0g of grip on the skidpad and get through the slalom almost as fast as the Ferrari 599, so you've got plenty of traction to work with. And tons of power from this naturally aspirated ohv V-10 — unique to this group. Its sub-100-grand price tag is also unique.

Overall, the Viper is what used to be called "a man's car," and when it's gone we may not see its like again. Nothing else is quite like it even now

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Ferrari 599 GTB Fiorano

Ferrari didn't have one of these 611-bhp beauties sitting around for us to test, so we borrowed one from a friend of the magazine who shall remain unnamed, yet should be canonized for his generosity, just as soon as we get another Italian Pope installed.

Here we go up slightly in price ($302,584) and complexity. Outwardly, the 599 is a classic Ferrari GT Berlinetta with a big 6.0-liter dohc V-12 up front, two seats, an elegant leather interior and a svelte body from Pininfarina.

Underneath that '60s-clean aluminum bodywork, however, the 599 is a spear-carrier for the full range of Ferrari's F1-derived technology. The rear-mounted transaxle houses a 6-speed "F1-SuperFast" sequential box operated with paddle shifters at the steering wheel (a manual 6-speed box is also available). A transmission/engine management program shortens shifting time as the car is driven harder and faster. It can also be operated in a straight automatic mode, for less frenetic motoring.

The semi-active suspension system uses fluid with magnetically varied (magnetorheological) viscosity for very fast response to roll, pitch and surface changes. It also has F1-Trac stability and traction control, with a steering wheel-mounted dynamic control switch with settings for Ice, Low Grip, Sport and Race. In other words, you may want to buy a shop manual now if you plan to restore this car in 40 years. There's a lot going on under the skin.

But the result is an intense, focused, pure Ferrari driving experience. This car may have GT in its name, but it's more race-car-like than anything here, except, perhaps for the Lamborghini. The 611-bhp (at 7600 rpm) V-12 makes big, linear power, but still accelerates with a high-pitched ripping sound as the rpm climb. Ride is moderately stiff, even in its softest damping position, and the car is low enough to scrape its underpinnings occasionally, but balance and feedback through the wheel are superb. At first the steering feels a bit darty, but — with familiarity — it merely seems quick and taut.

The paddle-shift mechanical box is a mixed blessing. On winding roads it throws big, whooping perfectly matched downshifts and quick, succinct upshifts — better than most humans can manage. Parking or maneuvering in city traffic, however, it's still a slightly clunky distraction. The Ferrari wants to go fast and doesn't understand why you're horsing it around town or jerkily backing into a parallel parking spot. It senses — as Kurt Vonnegut once said of a friend's Russian Wolfhound in Manhattan — that some terrible mistake has been made.

The 599 is a pure dose of sports-car aggression, busy and charismatic. And maybe a bit high-strung and nervous if you've just climbed out of, say, the Bentley. Both these cars make good standard-bearers for their respective national traditions. It's Mountbatten versus Pavarotti.

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Lamborghini Murciélago LP640

Let me say this: If you were a high school teacher and pulled into the school parking lot with a Lamborghini Murciélago on your first day at work, your students would probably sit through class in stunned, respectful silence for the rest of the year, their eyes twitching nervously toward the parking lot. The car has that effect on people. Wherever you park, it's like bringing the cast of "Oh, Calcutta!" to Peoria.

Here is a total refutation of logic in the name of glory. The $354,000 Lamborghini almost defines the term "exotic car." Wide, brawny and colorful, it's powered by a 6.5-liter V-12 that makes 632 bhp at a siren-like 8000 rpm. And it sends all that power to all four wheels.

Easy to forget, then, that under all that Bird of Paradise glamour is a very tough, fast and well-developed sports car. On our 2-lane Central Coast roads it was magnificent — a go-kart with huge wide tires, superb suspension and 632 screaming horsepower. Wide, yes, but it's a car that gets smaller and nimbler the faster you go.

The engine builds power steadily toward its 8300-rpm redline, but it also has huge wallop in the 3000–6000-rpm range. Actually, it simply makes power everywhere, and is never caught flat-footed at any rpm. Step on it, and it lunges effortlessly forward, instantly. It feels torquier than the Ferrari (and the numbers confirm it), and it gets around the skidpad and through the slalom just a little quicker.

Steering feel is excellent, turn-in quick and intuitive and the suspension damping superb over the rough stuff, as if the front bumper were reading the road and telegraphing messages to the tires. Switch the damping to the Sport mode and it gets decidedly stiffer (as it should), making the car feel even more race-car like. The sound, cabin layout and low seating position of the Lambo can easily lead to delusions of being on the Mulsanne Straight. You sense it wants to go 200 mph and would gladly hunker down and do it.

The seats, incidentally, are excellent. Essentially semi-reclined shells, they have few adjustments but fit our wide variety of editorial types quite comfortably. The paddle shifters, like the Ferrari's, can be a little clunky around town but work nicely on the back roads, throwing downshifts with a quick howling whoop followed by race-car-like mutterings. Some of us downshifted unnecessarily, just for the sound. Yes we did.

In this group, the Lamborghini may be the most exhilarating car (in close competition with the Ferrari), but — with its swing-up doors and low ride height — it's also the car least likely to get driven to dinner after a hard day on the road. It uses up your adrenaline as you drive. Gloriously.

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Mercedes-Benz SL65 AMG

Now, here is a car that doesn't puff its chest out, strut around and pretend to be doing anything — it just does it, sort of like von Richthofen giving a quick demonstration on how to shoot down a French barrage balloon without wasting a lot of time or energy. There's a cool perfection here that's stunning.

Soon after climbing behind the wheel of the $194,700 Mercedes on a rural valley road full of sweepers, hairpins and undulations, I realized that I could drive the SL65 faster and with less effort than any other car here, humming from point A to B like a big hefty electron flowing smoothly through a wire. A thick, beefy wire that could light up a city.

Part of it is the engine. This is a 6.0-liter twin-turbo V-12 that cranks out 604 very smooth and accessible horsepower — with a mind-boggling 738 lb.-ft. of torque on tap from 2000 to 4000 rpm. As with the Bentley, there's no old-school waiting around for the turbos to do their thing. They're always ready to prod that big V-12 past the apparent limitations of physics and throw your 4555-lb. car down the road with startling immediacy. Mated to a seamless, crisp-shifting 5-speed automatic transmission that can be paddle-shifted or left in Drive (or switched to a Sport mode) and a multi-disc limited-slip rear end, this whole driveline works as a harmonious single piece to get the job done.

Mercedes' ABC (Active Body Control) suspension provides a civilized and supple ride while eliminating body roll and brake dive, and the effect is a combination of serenity and absolute leech-like grip in the corners. A few of our editors who have track-tested this system don't like it much, criticizing its slightly artificial feel and poor early-warning feedback for the approaching limits of grip. That may be, but on public roads you have to drive this thing like a maniac before any limits are reached. And the local grape-growers and farmers don't like it much when you do.

For all that insular suspension technology, the steering is surprisingly live, with good feedback. The car slices accurately through corners, and the immense cast-iron brake rotors haul it down quickly and safely when a stack of pallets falls off a vineyard truck.

Add the usual sumptuous Mercedes interior with wood, leather and aluminum trim, great seats and that patented block-of-titanium solidness, and this is one of the world's most impressive conveyances. Not quite as visceral to operate — in the traditional sense — as some of the other cars here, but the SL65 makes its own charisma, a beautifully integrated hyperkinetic perfection.

Conclusion

In an episode of "A Prairie Home Companion" several years ago, Garrison Keillor had the Lutheran minister and his wife from Lake Wobegone on a vacation in Italy, taking a tour of Rome. When they came out of the Vatican, the minister's wife turned to him and said, "How come the Catholics got the Sistine Chapel and we Lutherans got the plaster praying hands?"

Philosophically and financially, these cars may not make much more sense than the Sistine Chapel did in its own troubled age, but we're still glad that somebody made them. And quite happy to go on a tour.


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