Cyprus Mail
Opinion

The power of a battery-operated Cyprus

Elon Musk, co-founder and CEO of Tesla, poses with a model of his electric car

By Karl Mueller

I AM a fan of France. Whenever it lost a war or its optimistic national spirit, when it got stagnant, brooding and navel-gazing, and revolution was not in the air, the idea of “grands projets” came up.

These were big, cutting-edge restoration, technological, architectural, military or other national efforts, meant to lift the patriotic ego and the general public mood. The rebirth of Carcassonne, building Eiffel Tower and the TGV, the creation of the nuclear Force de Frappe, the construction of the Ariane space rockets, the big changes to Paris by Baron Haussmann and at La Défense or the Centre Pompidou, the Maginot Line and the founding of the precursors of the EU, and so on. These emblematic ventures allowed France to regenerate, rejuvenate and reinvigorate itself at regular intervals. And by propelling itself, France often advanced Europe and the world.

Cyprus is, for many reasons, including the lingering economic and property crisis and the intractable Cyprus Problem, in bad need of truly grand projects as well. And, especially with its highly trained workforce and its collective intelligence, it is perfectly capable of attacking “grands projets” of its own. Cyprus can and should do more for itself than just implement what the troika asks of it. For it is true: Never waste a good crisis!

One grand project could be a new Eco city in Famagusta, encompassing the whole town, not just Varosha. Such projects would clearly signal that in post-crisis Cyprus, money is not just being pumped into private consumption by means of (again) cheap credit, but used for the general public good, especially for investing in future- and export-oriented new ventures with a potential to trigger many additional advantages for the whole national economy.

Cyprus should, amongst others, become an energy technology hub, developing new ideas and products for an ever growing renewables market.

This is my suggestion: To the south east of Nicosia, in the thinly populated buffer zone area, close to the geographic and demographic point of gravity of the island, and not so very far from Larnaca or Vasilikos ports, Cyprus could build a state-of-the-art and environmentally clean incineration plant for the waste of the whole island, adjacent to a big and clean refuse sorting facility and together with a huge solar power station.

These two should provide all of the additional energy (and, in summertime, more) needed for another project, to be built in their immediate vicinity: a huge battery factory. This mega factory (developed by PayPal founder, Tesla CEO, engineer and investor Elon Musk) should develop and produce the most modern lithium and other batteries and accumulators on the market in huge quantities, mostly for export. It would directly compete with the mega factory now planned or being built in the mid-west of the USA, but with a number of very important comparative advantages.
Musk’s ground-breaking project for building his Lithium battery producing “gigafactory” for making mainly electric car batteries in the USA needs, for the overall best outcomes, competition somewhere else on a similar scale.

In terms of market economy, it needs it very badly, and Europe should be at the forefront and is best placed – geographically and demographically – to provide this necessary competition!

Such competition would ensure better products, lower prices for customers, maybe lower profit margins for producers too, but with high incentives to re-invest earnings in the battery enterprise, and bolder and more dedicated research and innovation efforts.

I can think of no better place for this than peaceful, stable and traffic-wise well-connected Cyprus.

This venture would guarantee a reduction of transport and storage/warehousing costs, by making the batteries and accumulators close to where the bulk of future E-cars worldwide will be sold. For there are bound to be, eventually, more and more E-cars “here” on the three continents which meet near Cyprus than on the other side of the Atlantic Ocean – or on the other, western side of the Mediterranean, for that matter. Just think of Egypt with its looming 90 million inhabitants.

But despite competition, nobody would be taking away anything from anybody in the long run: today’s “cake of batteries sold” worldwide is soon bound to grow exponentially, even if the number of cars in Europe is at some stage projected to start to fall over the next forty years. The economies of scale would eventually – depending on the speed of the take-off of certain market developments – allow for several such mega factories worldwide. Especially considering that the expansion of the electric car market will go high-wire in the next few years, and that such batteries and large rechargeable cells could eventually be multi-purpose batteries or accumulators, storing electricity for all possible industrial, domestic, transport or storage uses, not just for road mobility.

Moreover, the enticement for that achievement could be provided and the peace dividend of a Cyprus solution could be reaped to a great extent already while peace was certain and near, but still not fully formalised, by getting the financial means together for such a huge endeavour. It would quickly become obvious that a Cyprob solution would greatly facilitate and speed up the readiness for and flow of investment towards this mega factory. And that peace dividend would have enormous and quick positive effects for this project and for the whole island after a signed and fully effective peace agreement, by encouraging early planning now for an expansion with Turkish Cypriot employees at later stages. The roads to the factory and other infrastructure on the occupied part of the island for a disappearing buffer zone could already be prepared now.

The venture would be an ideal way to test(-drive) a new fast-track process for licensing large strategic investments, for which the chambers of commerce are pleading. This project would also tie in well with the planned Cyprus Science and Technology Park and with the vision of the government to transform Cyprus into a regional applied knowledge-based hub.

Whether this “gigafactory” would belong to one holding enterprise or would rather be run by a cluster of several enterprises is not an ideological question – one should opt for the best, economically most productive solution.

After creating a plan and implementation programme and solving related financing and funding issues, the work on the plant could start on a signal date, maybe on October 1, 2015. It would give the Cypriot building, design and technical equipment industry and businesses a huge and instantly very beneficial shot in the arm. By that date, not all the financing, only the initial or start-up financing would have to be secured – maybe through an initial IPO directed and addressed at all Cypriot businessmen and households. Financing would remain a continuous step by step “work in progress” issue, following the parallel curves of increasing trust in the project as well as in the island’s political and economic future (successful unification negotiations permitting).

The “twin” incineration and solar power plants and the first “instalment” of the battery factory should be finished and operational at the latest by the end of 2016, if this is realistically feasible, jointly with foreign partners and their expertise. This should and could be possible, given sufficient commitment, considering what has recently been speedily built at Vasilikos or at the Limassol marina.

Cyprus should try to go for the advantage of the first mover. Robust and modern batteries according to established standards should – as quickly as scientific progress in Cyprus, yes, in Cyprus allows – give way to increasingly cutting-edge, sophisticated and unique ones of world benchmark quality developed with Cypriot universities and research institutions. These latter ones will have to be expanded and should re-direct part of their student intake towards the “right” technical subjects accordingly, in order to localise most of the workforce, as much and as early as possible. The battery factory, built according to a flexible modular system and strategy, should therefore be easily adaptable to new production necessities and goals all along its existence and its continuous expansion.

Low, unbeatable pricing for its products would at first be essential. These products would hugely add to Cyprus’ fairly rudimentary export sophistication. They can make its so far modest logistic performance index soar. Subsidies will have to flow – in the common EU interest. What was possible for Airbus/EADS so far should not be withheld from this effort. The whole of Europe stands to gain (but, to be fair, Cyprus more than all other EU member states, and why not?).

The mega factory in Cyprus could provide, in all probability, at full capacity, with all its spin-offs, many thousands of new jobs (largely for people already living in Cyprus), many of them very highly qualified ones. A multitude of “complementing” jobs for various qualifications would ensue in spin-off, ancillary or connected activities, to be performed almost wholly by local SMEs (a Cypriot forte!) and local employees. And this is not counting many further temporary jobs in the building and infrastructure-providing industries.

Without transport costs, batteries and accumulators in Cyprus itself would become comparatively cheap. By preparing early – and starting to mutate into – a uniquely “battery-powered” society “for the 21st Century” which would largely or mostly be reliant on renewables, Cyprus would, as first mover in this field, become the place of pilgrimage for anybody interested in such a model. It would be the first entire country having really achieved such a transformation, without the use of a single nuclear power station.

Already by 2025 Cyprus would be unrecognisably different from today. It would be, for one, the unbeatable world-class champion in modern, mostly renewable energy production and storage.

The greater percentage of that storage would be performed not through old-style and drought-threatened water reservoirs, but through battery-powered “energy stations”, among which big parking lots with photovoltaic roofs near the outskirts of larger conurbations used as park-and-ride and electricity loading facilities for cars during daytime would figure prominently.

And the later and more slowly “emerging” natural gas bonanza of Cyprus would be largely, almost totally exported, especially in the warm seasons. Moreover, a systematic decentralisation (motto: “Solar panels on every roof”) could mostly free up the power (to be) generated by big solar, wind and biogas generation facilities for big power-hungry ventures like desalination plants.
Demonstrating pure madness, recent projections show that worldwide, fossil fuels have been subsidised altogether to the tune of 550 billion US dollars in 2013, more than four times as much as renewables with just 120 billion US dollars. The World Energy Council has pointed out in its most recent report how the wrong or right emphasis and volume of today’s energy financing decisions will strongly impact our future energy security, future energy prices and our future energy sustainability. Cyprus could be a world laboratory of “right”, exemplary energy decision-making.

It is wrong for Cyprus to consider itself at an energy disadvantage because of its island nature. On the contrary, this makes its autonomous leap forward much easier. Cyprus as a small country could show that the transformation into a solar or photovoltaic (and renewables) hub can happen within a few years instead of at a snail’s pace like everywhere else. And that it can, on an island, go far beyond 20 or 30 per cent use of renewables.

As a luxury bonus for a country with soon dead cheap renewable energy, desalination plants would amply provide much of the water. Traffic would still be less than thirty per cent public (old habits die hard), except in the totally car-free town centres, where dense network electric minibuses (powered with batteries made in Cyprus) would circulate at short intervals. But overland road traffic – considering the short distances, almost wholly electric too – would whizz around virtually noiselessly and without exhaust fumes.

Even without much better insulation (correcting former omissions is very expensive), the many energy-inefficient houses in Cyprus would be wonderfully cool in the long summer and warm in the short winter, due mainly to the full use of renewables, especially the sun. Why not waste electricity if you have it in abundance and cheaply, if it is renewable? What is occasionally already happening in a patchwork fashion now would be turned into universal blanket solutions: very many things from parking meters to car wash facilities, to service stations to traffic and street lights, workshops, shopping centres  and even hospitals would be powered (almost all year round) autonomously through “insular” battery solutions with solar panels, making blackouts impossible. The grid, having become smart, would rather regulate the flow of electricity than merely distribute it.

The mega factory would – in Cyprus’ interest – emphasise the strategic and geopolitical value of the island in the region, giving all other regional players a stake in its stability and independence.

And finally, CBS could, in future, not only stand for an American TV news network. It would be the abbreviation for “Cyprus Battery Standard”. This would be a worldwide, highly recognisable logo and standard trademark for modern, long life, state of the art, cost- and energy-efficient batteries, (re-)usable virtually everywhere and for any existing function.

The Cypriot batteries would not just be exported. They would be massively used right here on the island to store electricity mainly for the nighttime. Cyprus would have done before its hydrocarbons boom what so many other nations did only after its peak: turn itself into a frontier technology and high tech green state, with a sound, admirably ecological system for energy generation.

Am I dreaming? I am hopefully not the only one – and it is Christmas. But Cyprus is now coming out of the investment desert. And I am convinced: Cyprus could and can reach for the stars, if it only puts its heart into it, starting by getting over and done with the debilitating and crippling Cyprus Problem. Let the lithium (a traditional anti-depressant to boot!) come in and the batteries get out.

 

Dr. Karl Mueller is the Austrian ambassador to Cyprus

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