Hacker News Reader

Sure, or we can think of it in the same way we thought about their investment in Citigroup in 2007, their investment in Uber in 2016 or their investment in Snapchat this year.

They are masters of market timing... just not the good kind.

If you have data to suggest that their risk adjusted returns are abysmal then that would be very interesting. I don't see the point of picking 3 investments from a fund worth hundreds of billions and presenting it as data that they are underperforming.

> They could cover a desert in panels and sell the cars and batteries across Europe/Asia, while providing the power as well. They would once again have the largest control of the world's energy.

Doesn't seem like you can reasonably charge a car in europe/asia from solar panels in the middle east. You'll be dealing with some pretty nasty transmission losses.

> Doesn't seem like you can reasonably charge a car in europe/asia from solar panels in the middle east. You'll be dealing with some pretty nasty transmission losses.

First of all, the oil reserves in Saudi-Arabia aren't going to last forever - but they will need massive amounts of energy to maintain their cities, especially for drinking water. Desalination is ridiculously expensive, and water access will be the war driver in the entire Middle East once climate change really hits. Cover the desert with solar plants, the coasts with desalination plants (and don't care about the brine) => control who gets the electricity and/or the water, control the region. Saudi-Arabia is actually already going pretty far in their fight for regional supremacy, that would fit perfectly.

As for transmitting the energy to Europe/Asia, well... there's technology in the works to synthesize gas (both gasoline and, well, gas) using electricity, which can be fed into the existing gas pipeline infrastructure and thus sold to the wide world.

Wars about control of water will be centered around areas with fresh water availability. The middle east doesnt have any.

If you have cheap desalinization capability, why would there be wars over water?

> Wars about control of water will be centered around areas with fresh water availability. The middle east doesnt have any.

More likely, they'll be centered around points of availability in areas of relative scarcity.

There is, in fact freshwater in the Middle East, just not a lot. Which makes what is there a potential source of contention.

Fair point. Do climate models have the fidelity to predict desertification? My intuition would be that the entire middle east will be devoid of water at 2 degrees hotter.

As always, the question is 'with how much certainty'? At low enough certainty I could predict what parts of the world will get dryer or wetter on the back of an envelope, but there are a lot of unknowables like human activity that would have to be included to make a quite reliable prediction.

If you have cheap desalinization capability, why would there be wars over water?

"Cheap" desalinization is like "bargain" chip fab. It's still an inherently expensive proposition.

I agree that cheap and expensive need context.

According to the first link I found about large scale desalination, it can be done for a wholesale price of around $0.58/cubic meter.[1]

For comparison, my local water authority (in a part of the US that is not particularly dry) charges about $0.94/cubic meter.

Without knowing exactly what the difference is between wholesale and retail rates, I feel reasonably confident that desalination technology is currently sufficient to avoid civilization collapse and/or war.

[1]https://www.technologyreview.com/s/534996/megascale-desalina...

I feel reasonably confident that desalination technology is currently sufficient to avoid civilization collapse and/or war.

Yes. But the experience up until now, is that desalinization is so much more expensive than other water sources, to the point that such plants often get mothballed when the other sources become available again.

https://www.circleofblue.org/2016/asia/water-scarce-regions-...

> Without knowing exactly what the difference is between wholesale and retail rates, I feel reasonably confident that desalination technology is currently sufficient to avoid civilization collapse and/or war.

The problem is you're gonna need energy to operate these plants and you can't scale stuff up infinitely as the brine will kill off marine life and eventually, the water sources will become so salty that they can not be used for desalination any more: https://www.theguardian.com/global-development-professionals...

Which means, once Peak Salt hits, there will be problems. Oh, and desalinating water for drinking purposes is one thing - using it for agricultural demands is a whole different beast. Egypt, for example, already had problems in 2010, and the issue won't get smaller over the decades. http://edition.cnn.com/2010/WORLD/africa/11/09/egypt.water.s...

"eventually, the water sources will become so salty that they can not be used for desalination any more"

Where do you think the water will go? I mean, if it doesn't end up in the ground, or the ocean...

> First of all, the oil reserves in Saudi-Arabia aren't going to last forever - but they will need massive amounts of energy to maintain their cities, especially for drinking water. Desalination is ridiculously expensive, and water access will be the war driver in the entire Middle East once climate change really hits.

Somewhat OT, but... there has been enormous progress in energy efficient desalination, to the point that Israel has become a net exporter of water. See DOI 10.1016/j.desal.2017.10.033 for more technical information on recent progress desalination.

"Desalination is ridiculously expensive" - as long as you are near the ocean, it's pretty cheap. Hyflux[1] on a 25 year DBOO contract will sell you as much water as you want for less than $0.50 per 1000 liters. Combined with even a modicum of water conservation [2], you can get per-capita water use down to around a cost of $0.05/day at a 100 liters of use a day.

[1] https://www.wateronline.com/doc/pub-and-hyflux-sign-water-pu... [2] http://www.waterwise.co.za/export/sites/water-wise/downloads...

High Voltage Direct Current transmission lines typically lose about 3% per 1000km [1]. That's quite manageable. Building a line of that length through multiple countries would take a while, but the Saudis could pull it off. They certainly have the money

1: https://en.m.wikipedia.org/wiki/High-voltage_direct_current

Woah, didn't realize long distance transmission was that efficient. Now I'm curious how crazy of an idea it would be to build a global solar electrical network to obviate the need for batteries (the sun is almost always shining somewhere).

You do have to keep in mind the further losses in converting it back to low voltage AC using very large and expensive inverters / transformers.

That's a loss that doesn't scale with range though.

On a smaller scale, putting solar panels in the Sahara Desert and run a big cable to Europe is frequently considered. Being in a desert removes most cloud cover, it's close to Europe, and the area required is miniscule even if you want to provide the entire area of Europe that way.

The only problems are that the day-night cycle still exists and storage is expensive, that it would be a massive capital investment, and that the governments of most countries in the Sahara aren't very stable.

Lybia had started doing exactly that, in 2009/2010: http://helioscsp.com/libya-unveils-project-to-supply-solar-p...

In 2011, France and the US forced a regime-change that resulted in civil war and de-facto partition of the country. I would expect most of that investment has been destroyed by now, and the security situation is unlikely to be stable enough to restart this sort of grand plan for at least a decade.

In the meantime, Morocco (faithful French ally, an absolute monarchy with extremist-Islam undertones) started its own effort, which is now considered to be the largest solar-panel plant in the world: https://en.wikipedia.org/wiki/Ouarzazate_Solar_Power_Station

I don't know if it'll happen, but it's been proposed, e.g. https://www.nbcnews.com/business/energy/china-unveils-propos...

There was a project like that (though it failed): https://en.wikipedia.org/wiki/Desertec

Could charge the batteries in the desert and ship them.

Those are very heavy, and electricity is pretty cheap. Losing proposition.

I don't know much about how this works. Am I right in saying this is like the episode in Yu-Gi-Oh where Seto takes 51% of his fathers company so that he then owns the company? That's the only example I can think of to illustrate what I interpret this as.

Solar panel efficiency is inversely proportional to temperature, plus all that sand + wind is going to be adding to maintenance costs. There's better places to put solar panels than in the desert.

Your concerns are interesting.

Here are some solar power plants that appear to have the secret to overcoming temperature, sand, and wind. Any ideas what they're doing?

• 1547 MW capacity: Tengger Desert Solar Park

• 1000 MW capacity: Kurnool Ultra Mega Solar Park

• 1000 MW capacity: Datong Solar Power Top Runner Base

• 850 MW capacity: Longyangxia Dam Solar Park

• 746 MW capacity: Bhadla Solar Park

• 600 MW capacity: Pavagada Solar Park

• 579 MW capacity: Solar Star, Rosamond, CA, United States

• 552 MW capacity: Copper Mountain Solar Facility, Boulder City, NV, United States

• 550 MW capacity: Topaz Solar Farm, San Luis Obispo County, CA, United States

• 550 MW capacity: Desert Sunlight, Desert Center, CA, United States

• 500 MW capacity: Huanghe Hydropower Golmud Solar Park

• 452 MW capacity: Mount Signal Solar, Calexico, CA, United States

• 400 MW capacity: Mesquite Solar Project, Arlington, AZ, United States

• 140 W capacity: Mars Spirit Rover (ok, the experiment failed in 2011)

• 140 W capacity: Mars Opportunity Rover

I'm not sure about any of these plants in particular, but a lot don't use PV cells, instead using mirrors to heat and evaporate a liquid, driving a turbine.

I don't know whether it's accurate, but I've noticed people saying that these sorts of plants are kind of obsolete these days, because of the development of PV cells.

It's actually liquid sodium in newer designs, which retains heat well, is stored in an insulated tank, and can generate power using that heat even after the sun goes down. So no, I don't think they're obsolete. https://www.scientificamerican.com/article/new-concentrating...

FYI, liquid salt is not quite the same thing as liquid sodium. Source: someone I knew worked on liquid sodium power plants.

Also, I think PV prices may have declined around 50% since that article was written.

Want to know something else that is fun about the concentrated thermal projects? If the sun is not available for long periods of time and the fluid cools down too much they have to dump energy into it to prevent it from solidify to point of overwhelming the pumps capacity!

Sounds like a good reason to keep that kind of generation in the desert, then. That's interesting, though. I suppose they could just divert some power generation to battery storage for those heaters though, just like nuclear reactors have backup generators for cooling.

Not necessarily obsolete, just uncompetitive. Many of the concentrated thermal systems can meet 30% efficiency but they usually are more of steel and plumbing projects than solar projects. On top of the high initial capital cost, they have higher maintenance as it is a system of high temperatures with moving parts.

That was exactly the meaning/claim - that because PV prices have fallen, it doesn't make sense to build new thermal plants.

They're all very, very publicly documented - just google it!

All PV cells have a temperature coefficient that reduces their productivity in heat. some preform better than others. Thin-film is notable example. Placing large PV farms in the desert is mainly about two things: High insolation value and cheap land that is easy to build on. Many of the desert regions have very few cloudy days each year offering more available sunlight hours improving the annual production of the system. Second, land in the desert regions are orders of magnitude cheaper to buy than other areas. This drives down overall project cost and improves the IRR. In addition to the land being cheap, it hold little economic value for much else. If it can be used for generating power, then local authorities are often favorable when reviewing these projects.

Given how efficient robots are getting these days. Cleaning panels is not that hard.

And yeah, Deserts work well given how predictable the weather is there. Don't forget consistency is an another factor.

It is harder than you might think. Not all dirt adheres the same way. Dried bird dropping are significantly more resistant to abrasive cleaning than settled dust. On top of that the opacity is much more problematic for the cell as it creates a resistive hotspot.

Birds won't be flying around in a desert where they can't find water.

Maintenance problems exist with dams or for that matter with any power generation mechanism.

None of these are show stopper problems.

I agree module cleaning is not a showstopper, but it does have its challenges.

-Birds fly everywhere; can't hide from them. It can be hard to diagnose some of the problems they create.

"Robotic" cleaning is really not as common as the headlines make it seem. A couple of big projects have used them to target settled dust that can be removed without water. For most projects, the robotic systems don't pencil out and people default to paying a small crew every couple of months to go out and wash them.

Why is Saudi Arabia Elon's enemy here? Perhaps it is the opposite, and the Saudis are the one's funding the whole going private operation in the first place?

Unlike EV, currently there are plenty of other options for solar panels. Also, there are plenty of other deserts outside of Saudi Arabia. I think it is a smart move by the Saudi fund but I don't think owning Tesla alone is enough to maintain them as the leader in the energy market in the decades to come.

That's an interesting take but I don't think it's Musk vs the Sauds. Musk realized he can't attract and retain tech talent with the shares in such a volatile state. I believe that's the underlying motivation here.

"ha no this is absurd, this is not how any of this works" - Matt Levine

https://twitter.com/matt_levine/status/1027245773237436416

What do you mean 'way higher than the Saudi's were planning on'? I'm confused about the logistics of taking a company private, or how the Saudis would be negatively affected by Musk tweeting out that he effectively wants the stock to go up in price.

The stock was work $360 before his tweet and almost $390 afterwards (before the market decided it was a boutade); if Musk can prove he has the cash, the price will naturally gravitate towards $420. That basically means he's daring the Saudis to pay 15% more (about $10bn more), in order to take over from him, than they had presumably planned to do.

> the price will naturally gravitate towards $420

There's a decent chance of a bidding war driving the share price far higher than that.

This is strategic for the Saudis. And there are other strategic investors and sovereign wealth funds who will not want to see Tesla taken private for 10% above today's closing price.

Tesla's market cap is only 6% of Apple's, and Apple isn't geopolitically strategic.

Norway, China and Abu Dhabi all have SWFs larger than Saudi Arabia [1], and the energy implications of letting Tesla go would be strategic for each of them.

[1] https://en.wikipedia.org/wiki/Sovereign_wealth_fund#Largest_...

Answer for your Q is already there in OP's post

>He is willing to take it private at the $420 price, probably way higher than the Saudi's were planning on

> how the Saudis would be negatively affected by Musk tweeting out that he effectively wants the stock to go up in price.

Saudis would have to shell out more money if valuation keep going higher

Or, they could just own the operation that generates the power much closer to the point of use.

>It's very smart on Saudi Fund's part... They would own the worlds largest solar, battery, and EV producer. They could cover a desert in panels and sell the cars and batteries across Europe/Asia, while providing the power as well. They would once again have the largest control of the world's energy.

I'm afraid I have to shatter this dream. There is a thing called Ohm's law, and it is not taught in business schools as I know... :)

Supposedly you went to business school then? :-)

HVDC has losses at about 3% per 1000km, from Saudi Arabia to the center of Europe is less than 5000 km as the crow flies. Doesn't seem too bad to me.

Out of curiosity, I googled current HVDC lines, and was surprised at how rapidly it has started to replace HVAC for long-distance transmission. It now strikes me that getting a line from the peninsula to europe will be more of a political effort than a technical one, which is not the conclusion I was initially expecting.

I thought the losses were nonlinear and complex? IE 10,000km is not 30% loss

Actually, you should do better than 30% loss due to the non-linearity:

    1 - 0.97**10
    => 0.2625758731050719