The two new institutes are intended to be hubs where businesses, academic researchers, state and federal agencies, and non-governmental organizations pool together and synchronize their resources for the applied study and application development, charged with getting their respective technologies to market faster. The public-private partnerships are also meant to serve as teaching factories in training and preparing workers to be able to work in these technologies when they are commercially ready.
The institutes are led by the Department of Defense and follow last month’s announcement of the creation of a Department of Energy-led institute for next-generation power electronics that is based in Raleigh, N.C.. Obama also revealed that the Pentagon will head the next NNMI institute for the development of advanced composites manufacturing after a competitive selection process is completed. With three more NNMI competitions scheduled to be held this year, and a pilot institute already operating in Youngstown, Ohio, to speed up 3D printing technologies, the NNMI could grow to eight members by the end of this year.
The Detroit-area Lightweight and Modern Metals Innovation Institute, or LM3I, is a group of 34 companies, nine universities and labs, and 17 additional stakeholder organizations, including Lockheed Martin, GE, and Honda. It will attempt to speed to market manufacturing techniques and part designs for both commercial and defense uses, in hopes of expanding consumer products, automobiles, and aerospace and military vehicles made with lightweight, high-strength metals and alloys.
The Chicago-based Digital Manufacturing and Design Innovation Institute, or DMDI, will push development of software and virtual environments in product design, engineering, and production into a seamless and interoperable ”digital thread.” This data integration across the entire supply chain is being counted on to create and make products more quickly and less expensively. The DMDI is a group of 41 companies, 23 universities and labs, and nine industry and trade organizations. Several leading machine tool makers, 3D Systems, Autodesk, and Honeywell are members that will be lending their expertise.
MTConnect Institute, which stewards an open-source interoperability standard for manufacturing machinery, founded by AMT – Association For Manufacturing Technology, is one of the members of the DMDI group. “The DMDI provides a unique opportunity for industry, academia, and government to collaborate and accelerate the commercialization of digital-technology-based manufacturing products and services,” said Doug Woods, AMT’s president. “We think that this partnership with DMDI will further the use of the MTConnect Standard and foster a more seamless operating environment for manufacturers.”
The LM3I and DMDI are each being started with $70 million in DOD funds, which are being matched and expanded by public-private funding commitments from the consortium partners including state and city organizations. The two new institutes, along with the DOE’s Next Generation Power Electronics Institute, will consume the $200 million in existing budget funds the president pledged last year for the NNMI to invigorate advanced manufacturing in the United States. Obama, working with a bipartisan group of legislators, is hoping a bill authorizing $1 billion for a 45-institute network will be passed by Congress.
The Advanced Composites Manufacturing Innovation Institute thus hinges on congressional-approved appropriations to receive $70 million in DOE funding, which must be matched by non-federal investments, when it begins operations. This institute’s goal is to reduce the cost of fiber-reinforced polymer materials by 50 percent, reduce the energy required to make composite production parts by 75 percent, and increase composites recyclability to over 95 percent within 10 years. The advanced materials will benefit fuel-efficient cars and electric vehicles, wind turbines, and hydrogen and natural gas storage tanks, to name some.
The NNMI is openly modeled after Germany’s Fraunhofer Institute, which operates a network of applied research and development facilities and is in charge of the innovation and commercialization process in the country. It is the largest such network in Europe.
Obama, at a White House briefing for the newly awarded institutes, said the NNMI will help lead job and economic security for the country through manufacturing. “I’m really excited about these four hubs,” he said. “Part of the reason Germany has been able to take the lead in certain manufacturing areas is because they’ve invested in these hubs.”
He went on to say, “I don’t want the next big job-creating discovery to come from Germany or China or Japan. I want it to be made here in America.”
According to the White House, the U.S. manufacturing sector has added 622,000 jobs since early 2010, including more than 80,000 over the past four months. In his final term in office, Obama has made manufacturing a focal point of his administration and domestic policy.
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Equipment Finance Firms Exhibit Slight Caution
Banks, financial services companies, and independent leasing and finance companies are still feeling generally positive about the lending market for capital equipment purchases after severe winter conditions were partly blamed for the slowdown of business activity in much of the United States.
The February Monthly Confidence Index by the Equipment Leasing & Finance Foundation (MCI-EFI) of 63.3 was a sizable drop from January’s two-year peak of 64.9. Still, it marked the second-highest index since 2012, indicating lenders still expect relatively healthy business for equipment leases and loans. The MCI-EFI polls 50 key executives in the equipment finance sector.
“I am optimistic that there is increasing demand for equipment and therefore financing to acquire that equipment,” said Valerie Hayes Jester, president of Brandywine Capital Associates. “The brutal winter experienced by a significant portion of [the] country has slowed down many projects that would have been in progress by now.”
While tough weather had a near-term impact, the latest MCI-EFI suggests there may be some nervousness among some lending executives about the still conservative levels of capital spending among businesses early in the year. After years of cash hoarding, companies are expected to loosen their purse strings this year for capital expenditures as economic conditions have stabilized.
Sentiments about lending business conditions over the next four months weakened last month, with approximately one in every five executives saying conditions will improve compared with about one in three in January. Those who believe conditions will worsen increased from 5.6 to 6.1 percent of survey respondents.
Expectations of a rise in the number of equipment leases and loans slipped as a result, falling from 36 percent of respondents to 24.2 percent. More lenders in February think demand will stay the same, at 69.7 percent versus 61 percent in January.
While early indicators show businesses are still holding the reins tightly over spending, lenders are ready with money to deal, though that window may be closing, according to some. Nearly one in three executives expects more access to capital to fund equipment acquisitions in the coming months, up from 25 percent at the beginning of the year. But 3.1 percent said there will be less access to capital, as opposed to none who expressed that sentiment in January.
“I’m conflicted about the near-term,” said George Booth, managing director of Black Rock Capital. “All small to medium-size customers claim activity is sporadic and are not willing to commit capital for new equipment. Thus we see demand is off, but funding availability is strong.”
Lending executives’ feelings about the current state of the economy changed little in February. Three percent said the economy is in “excellent” shape, with the majority (93.8 percent) deeming it as “fair,” which was only a 0.6 percent drop from the previous month.
But when polled about the next six months, fewer felt economic conditions will improve, with the percentage of bullish execs dropping from 41.7 to 34.4 percent, while those who think the economy will stay the same went from 55.6 to 59.4 percent. Those who believe the economy will worsen jumped from 2.6 to 6.2 percent.
“The economy and the equipment finance market continue to experience peaks and valleys,” said Thomas Jaschik, president of BB&T EQuipment Finance. “The good news is the valleys aren’t getting any deeper, but the bad news is the peaks aren’t getting any higher. Hopefully, in 2014 the economy will gain enough confidence to break through.”
Asian Solar Panel Demand Simmers, Not Sizzles
The Asia-Pacific solar photovoltaic (PV) module market is forecast to show modest growth by the end of next year, jumping from $6.7 billion in 2012 to $8.6 billion by 2015, according to a new report from research and consulting firm GlobalData.
Currently growing at a compound annual growth rate (CAGR) of 7.9 percent through 2015, the region’s solar PV installed capacity is expected to accelerate over the coming years, from 19.6 gigawatts (GW) in 2012 to 420.6 GW by 2030, or a CAGR of 18.6 percent. In 2013, China and Japan dominated the region, accounting for a combined 77 percent of Asia-Pacific’s solar PV installed capacity.
“Governments in the region are promoting solar PV through various long-terms policies, financial incentives, subsidies, and tax benefits,” said Prasad Tanikella, GlobalData’s senior analyst covering alternative energy. “The strong commitment towards the development of solar energy has led to many research and development initiatives and increased solar power plant installations.”
Tanikella added that China continued to be the world’s largest manufacturer of solar modules, for the sixth consecutive year, in 2013.
“Domestically available polysilicon, a favorable regulatory environment, and an easily available and inexpensive labor force have allowed companies, such as Yingli Green Energy, Canadian Solar Inc., Trina Solar, LDK Solar, and Suntech Power Holdings Co., to lead solar module production with annual capacities of over 1,000 megawatts each,” the analyst noted.
Report Shows Disparate CO2 Emissions Among States
The U.S. Energy Information Administration’s latest state energy-related carbon dioxide emissions report, tabulating results for the year 2011, shows a big jump in CO2 production across a wide swath of the middle of the country as well as in some western states over a 21-year period from 1990 to 2011.
Based on the report by the EIA, a unit of the Department of Energy, Nebraska’s CO2 emissions resulting from energy-related activities jumped by 59 percent over that period. CO2 production in Iowa rose by 40.5 percent from its 1990 level, Missouri 31 percent, and Arkansas 31.5 percent. Arizona, Colorado, and Idaho had respective CO2 increases of 46.9, 40.4, and 37.6 percent. Another state that had at least a 30 percent increase in carbon emissions was South Carolina.
Those that had the biggest reductions in CO2 generation were along the eastern seaboard: Delaware (-30 percent), District of Columbia (-30.5), New York (-22.9), and Massachusetts (-20.4).
Not surprisingly, the biggest carbon emitters were the largest states: Texas, with 656 million metric tons (mt) of CO2, and California, with 346 mt. But for the Golden State, its 2011 emissions level was actually 7.3 percent lower than that in 1990.
Other states that produced the greatest levels of CO2 were Pennsylvania (245 mt, but a 6.9 percent reduction from 1990), Ohio (233 mt, 4.7 percent reduction), Florida (227 mt), Illinois (225 mt), Louisiana (223 mt, a 20.8 percent jump), and Indiana (207 mt).
The 2011-year statistics were the latest available on a state-by-state basis. The United States generated 5,384 mt of CO2 in 2011 from energy activities. U.S. energy-related carbon emissions have see-sawed over the past three years.
This article was originally published on ThomasNet News Industry Market Trends and is reprinted in its entirety with permission from Thomas Industrial Network. For more stories like this please visit Industry Market Trends.
Top photo credit: Lawrence Jackson, the White House