How to make money with cold fusion

1st Official Post

    The world energy market is roughly $6 trillion per year:


    https://www.enerdata.net/publi…-energy-expenditures.html


    $1.8 trillion per year is invested in energy, in things like digging wells, R&D, erecting wind towers and so on.


    That is the pot of money you can tap into with cold fusion. $1.8 trillion is the amount people will be willing to invest in cold fusion R&D per year, once it becomes clear that cold fusion will become a practical source of energy. $6 trillion per year is how much money you can divert from the oil, gas and coal companies earnings into your own pocket if you succeed in commercializing it. Not overnight, but in a remarkably short time. Roughly the time it took automobiles to replace most horses, which was from 1908 when the Model T was introduced, to 1928.


    So, how do you make this money? Not by trying to sell energy! That is a highly regulated industry. It is a difficult and complex business. The way to make money is to sell equipment. You gradually divert the earnings of energy industry into earnings by you. Many companies are already doing this, by selling machines with improved efficiency. Suppose you make an efficient water heater. You can sell it at a premium, and make more profit. The customer is willing to pay more because it reduces the natural gas bill and saves money overall.


    The average water heater costs $55 a month in gas. Suppose the customer ends up paying you $10 month more for your heater, but he saves $20 a month in gas. In effect, you are reducing the gas company's earnings by $20, and splitting the money between you and your customer.


    The potential is greater with cold fusion, because you eliminate the entire cost of fuel. You and the customer spit the $55; the gas company loses the whole amount.


    It is even more attractive for big ticket equipment. If an apartment complex pays $1000 a month for the gas space heating, you sell them a heater that costs about $500 a month more than a gas heater. The natural gas company loses $1000, you and the customer each make $500. After 20 years the equipment wears out and you sell a replacement. It is a steady stream of income. It is siphoned off from a $6 trillion pot of money, so there is plenty more money to grab. There is no way the energy companies can compete or under-price you.


    This is not a one-time profit. It is a steady stream of income, because the equipment wears out and must be replaced.


    In real life you have competition, and as you gradually wear away at gas, oil and coal company earnings, they lower their costs, and the amount left on the table decreases. But in principle, that is how it works.


    This only works out well if the cold fusion apartment complex space heater costs roughly as much to manufacture as a gas-fired heater. I think it will, because it is not particularly complicated and the materials are not rare. For the most part, it consists of pumps, thermostats and whatnot that are the same as the ones in a gas-fired or electric heater. Once the technology matures, there is no reason to think it will cost more. But you can sell it for much more, with much larger profits. The customer will be happy to pay more, because it eliminates the cost of fuel. Over the life of the machine, the fuel costs more than the equipment. So you have a tremendous potential profit margin. If the customer cannot afford the up-front cost, you can arrange for leasing. As long as it ends up costing substantially less per month, the customer will be happy. As old gas-fired equipment wears out, your equipment gradually replaces gas fired heaters. Then as your equipment wears out, you keep selling cold fusion heaters.


    To reiterate, the money goes from the natural gas company into your pocket, and into the customer's pocket, even though you are not selling energy per se. The amount of money waiting for you to tap into and transfer is $6 trillion per year. That is the most lucrative business opportunity in history. Every industrial company will understand that the first day it becomes generally known that cold fusion is real. They will soon be spending billions of dollars per year to develop it, just as they are now spending billions to develop self-driving cars.

    Or you could write a book:!:

    Yes I know Jed and some others have written books already about cold fusion but the current interest in the topic is low.

    Once it hits prime time then the world will wake up and there will be a huge appetite for books, probably serviced by authors who did not know anything about cold fusion till a few weeks before they wrote the book.

    So Jed it could be your big chance to tell the real cold fusion story to the massed public.

    As we have seen with Trump and Brexit many people are not too interested in loads of facts, just a good story with goodies and baddies that is topical and explains how they personally will benefit from the "new golden age".

    Oh and maybe lots of pictures .:/

    A few thoughts:


    Not sure I agree re: the horse to automobile example. I'm guessing, but It would seem to me that horses have a pretty short replacement cycle. How many years is a horse good for? I'm not sure, but I think that if you have to buy a new horse at reasonably short intervals, that would make the wholesale movement from horses to automobiles far faster than may be the case with steam turbines or industrial boilers to LENR. The incentive to replace legacy systems with new systems is really driven by capital budgets, which are driven by estimated returns on investment. The cheaper the LENR system, the more reliable it is, and the higher the cost savings, the faster the roll out. I would think that the longer the replacement cycle, the more inertia in capital budgets.


    I'm also not sure I agree with your estimate of the size of the total addressable markets (in $). It's absolutely true that it's huge, and that it's all the actors who currently buy energy. But, there are a lot of examples of a new industry collapsing the profit pool of an older industry, failing to seize that profit pool for themselves. The dynamics I outline below make me think that that would be the case with LENR.


    I'm not convinced it will be particularly profitable for anybody in the short run.


    If I had to guess, I'd say that there would be no convergence on any kind of standard in the LENR case (?), rather, there would be variation in systems offered, which would make competition more difficult.


    The really good industrial companies, like Atlas Copco, Kone and Spirax Sarco (as well as companies like Thermo Fisher, who sell a lot of consumables), earn a good deal of their revenue from services; spare parts, maintenance etc, and it seems that that would be true of a LENR system. They sure seem finicky. The question is what the margin profiles of new installations and maintenance would be. One would think that maintenance revenues would be high margin and high return on capital. You have an installed base of LENR installations, and they are more or less captive. This is true of elevators and compressed air. It would essentially be a services business, based on skilled labour and route density, like elevator maintenance or pest control.


    I'm not sure new installs would share the same margin profile. I'm of course guessing, but I'd imagine that price competition would be intense, thanks to the immense interest that would be generated and the flood of capital trying to enter the sector. This is what the elevator industry looks like. Even though the market is an extremely cosy oligopoly, new elevator installs are a low margin business. The same is true of jet engines. A cosy oligopoly with a low margin new engine business and a high margin parts and services business.


    I'd imagine that there'd be a fast and long series of refinements, offering higher COPs, better reliability etc. If the improvement is achieved at no significant additional manufacturing cost, I would think that the incentive is to compete by way of price. IE: offering a better system at the same price, or in the case of competitors, responding to a new system by outright cutting prices on their older system.


    Low margin installs is a fine business to be in if you have a large installed base that gives you a stream of high margin, non cyclical maintenance revenues. Every low margin install converts (or has a good chance of converting) into a high margin maintenance stream. It's worth noting that this dynamic, low margin new equipment + high margin services actually incentivises price competition. You want to get as many installations as you can, so as to lock in as much services revenue as possible. The services revenue is protected from competition and long lived in a way that makes it really attractive. Sacrificing the profitability of the new installation business makes sense in these situations.


    But imagine trying to run a low margin install business without the cushion of the installed base, at a time of rapid product improvement. Even if you were earning a high gross margin (price minus manufacturing cost), I'd think it likely that a good deal would be consumed by R&D, just to keep up with your competitors. Add the standard administrative costs of running a business and you can get a lot of margin erosion even if outright price competition wasn't intense. Furthermore, I'd expect a series of technological leaps, like in the personal computer space. It's really hard to manage a business in an environment where there are short innovation cycles.


    It all seems pretty brutal to me.


    That's not to say a lot of money wouldn't be made. It would be. And whoever ends up building those installed bases could well have one of the finest service and maintenance businesses ever; and one can imagine legislated part replacement and inspection schedules, driving revenue visibility. Getting from there to here seems the hard, bloody, desperate, trench warfare part.


    Of course, I'm not expert and welcome correction, disagreement etc. My thought experiment is really predicated on LENR as a standard capital goods industry, with LENR units sold to individuals and companies. More akin to solar panels, where the cost has plummeted even as they've become more efficient. If the industry wound up looking more like regular coal fired or nuclear power plants, with centralised production and a distribution network, things would likely be very different.


    Both outcomes are good. I think the former would be better, because it would drive the costs of the underlying technology as low as possible as quickly as possible, thereby commoditising it and opening up its use in the emerging world. If I understand correctly, it's the emerging markets that will really decide how much co2 goes into the atmosphere.

    The main argument some people make for selling energy instead of products is that it will protect their intellectual property. In my opinion, this is the sign of an inventor who cares more about making a fortune than helping advance our civilization. I've heard of too many inventors that desire to go this route; however, they all end up with nothing at all. The key to making money with cold fusion or exotic technology is NOT TO FALL VICTIM TO INVENTORS SYNDROME. If you see a straightforward path to making a decent amount of money, even if it involves exposing your IP to the world, do so.

    JedRothwell I've been following LENR since January 2011, you have been active many more years in this field.

    You are now making the impression, by starting this topic, that you are becoming more optimistic that LENR technology has taken an important step toward reality.

    That is a remarkable milestone!

    Quote from Director

    The main argument some people make for selling energy instead of products is that it will protect their intellectual property. In my opinion, this is the sign of an inventor who cares more about making a fortune than helping advance our civilization. I've heard of too many inventors that desire to go this route; however, they all end up with nothing at all. The key to making money with cold fusion or exotic technology is NOT TO FALL VICTIM TO INVENTORS SYNDROME. If you see a straightforward path to making a decent amount of money, even if it involves exposing your IP to the world, do so.


    Protecting inventions by IP has a few more motivations/options besides just plain aiming for money via a license program:

    - The inventor has invested money to make this invention possible. IP license could cover those costs

    - Having IP allows easier access to investors, allowing to mature the technology to an industrial level.

    - Having IP allows the inventor/assignee to control who can use this technology (e.g. think of excluding military applications)

    - Having IP allows the inventor/assignee to make his invention 'open source' and thus prevent other parties from commercialising at high costs for consumers.

    Quote from Rob Woudenberg

    You are now making the impression, by starting this topic, that you are becoming more optimistic that LENR technology has taken an important step toward reality.

    That is a remarkable milestone!


    Yes. I think that if Mizuno's latest experiment can be replicated, this is an important step toward commercialization. I think it proves beyond question that the effect can be scaled up and made into a commercially useful source of energy. It is only a matter of engineering. It also shows that there is enough palladium in the world to generate all the energy we need. We now know the reaction can occur at high temperatures and high power density, and that it can be controlled at least as well as a burning pile of coal or a fission reactor core.


    When I wrote my book, I did not know for sure whether it was even possible for cold fusion to become a useful source of energy. It seemed likely. The book is predicated on the assumption that it can be made practical. I think we now know for sure that it can be. It only has to be proved once, with one experiment, since the effect itself has been widely replicated and there is no doubt it exists.


    It is possible there is such strong political opposition to cold fusion it will never be developed. However, we now know it can be.

    I think, that overunity (and cold fusion in lesser extent) are inverse time arrow based technologies and inverse time economy is also needed for their practical utilization. Many experiences and market schemes developed by Edison, Ford and another pioneers of classical era industrialization work here in opposite way. Nicola Tesla would prosper these days.

    • Official Post

    I think, if and when the science behind LENR is well stablished and energy becomes infinite for mankind, the post scarcity era of many Sci Fi worlds could become gradually a reality. However, in most Sci Fi worlds, that happens only after a huge crysis that makes Mankind learn the lesson, the hard way...


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    Quote

    It is possible there is such strong political opposition to cold fusion it will never be developed.

    Absolute, complete, total, incomprehensible nonsense.


    Quote

    However, we now know it can be.

    I don't remember if you were physically present for these experiments. If not, while it seems more probable than it was before, you absolutely do not know that from the Mizuno work. If so, you have a much better idea but still can't be certain. Well... you can be as certain as you want but that could still be wrong.

    Quote from seven_of_twenty

    [It is possible there is such strong political opposition to cold fusion it will never be developed.]


    Absolute, complete, total, incomprehensible nonsense.

    I suggest you read more history. Ask yourself why there were no electric cars from 1908 to around 2000. Hybrid cars were patented around 1910 as I recall. Why were there none until the Prius? Read about Preston Tucker. Read the autobiography of Townes and you will see that the development of the laser was nearly prevented by opposition and academic politics.


    Quote from seven_of_twenty

    I don't remember if you were physically present for these experiments. If not, while it seems more probable than it was before

    I spent a couple of months there seeing various experiments. Seeing the data is the same as being there after you have done that. Regarding the possibility it is wrong, I am sure I included the caveat "if it can be replicated." That is a get-out-of-jail card for the evaluation of any experiment.

    Quote

    Ask yourself why there were no electric cars from 1908 to around 2000.

    IIRC, there were no good attempts, largely due to lead acid batteries. The EV-1 was much praised but it wasn't that great. Lead acid batteries mean short range and long recharge times. NiMH first and Li-ion second made the electric car and the hybrid car feasible. IIRC. Lots of car experiments were tried and failed. One of the more interesting innovations was the 1963 Chrysler with the gas turbine engine. Wasn't practical then or now. Electric cars are practical now. It isn't just batteries. It's electronics leading to control system innovations as well. Not much of it was political. Entrepreneurs short cut political considerations much of the time, outside maybe, of military secrets,


    Meanwhile, to stick to the topic:


    https://cen.acs.org/energy/nuc…hope-revolutionize/96/i32


    https://techcrunch.com/2019/06…roughly-50-million-boost/


    And while these are variants of hot fusion, how long do you think it would take to switch or add to their repertoire if Mizuno's recent work turned out to be valid?

    Quote from Zephir_AWT

    I think, that overunity (and cold fusion in lesser extent) are inverse time arrow based technologies and inverse time economy is also needed for their practical utilization. Many experiences and market schemes developed by Edison, Ford and another pioneers of classical era industrialization work here in opposite way. Nicola Tesla would prosper these days.


    Whaaaaaaat ?

    Quote

    For the sake of balance I should point out that Chrysler's gas turbine car was a decade or more behind the British one...

    https://en.wikipedia.org/wiki/Rover_JET1

    True but the Chrysler was street legal including exhaust temperature and was distributed to ordinary people. My parents had one briefly show up in their driveway to everyone at the party's amazement. They said the car made an engaging soft turbine whine noise at idle (not really loud) and the exhaust smelled like burning kerosene (an acquired taste) or an idling jet aircraft.


    Quote

    After testing, Chrysler conducted a user program from October 1963 to January 1966 that involved 203 individual drivers in 133 different cities across the United States cumulatively driving more than one million miles (1.6 million km). The program helped the company determine a variety of problems with the cars, notably with their complicated starting procedure, relatively unimpressive acceleration, and sub-par fuel economy and noise level. The experience also revealed key advantages of the turbine engines, including their remarkable durability, smooth operation, and relatively modest maintenance requirements.

    from Wikipedia


    I don't know if the Rover was actually used by ordinary potential buyers. From a brief look, it seems it was mostly a test device.


    BTW, more on topic, it's hard to conceive how anyone having a head start and proper patent protection could fail to make money, and tons of it, from a working cold fusion device. As I and others noted many times before, a simple room heater, now a la Mizuno, would sell millions and millions of copies out of the gate if operating costs were low and durability was high.

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