Engineer and investor who writes quantitative posts about how physical industries actually work — chemical plants, geothermal drilling, shipyards, thermal storage and the economics of low-volume manufacturing — at austinvernon.site.
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Their wordsEfforts to improve efficiency and remove vestigial features pay off handsomely.
Their wordsSome efforts, like nuclear-powered data centers, are reminiscent of Toyota's hydrogen push.
Their wordsDeleting the UPSs could knock off ~$750/kW after considering equipment, installation, and square footage reduction.
Their wordsInstalled generators cost ~$800/kW, and the data center capital cost, including servers, is ~$40,000/kW, so adding 1% more makeup compute capacity is money ahead of purchasing generators.
Their wordsThe optimal scenario is typically when the generators supply 1% of yearly electricity (shown below).
Their wordsThe solar array sizes under these assumptions are prohibitively large.
Their wordsThe cooling systems in most data centers are energy hogs and contribute no direct value.
Their wordsThe 100-megawatt facility might have ten 10-megawatt blocks served directly by a 1500V DC feeder line without connections to other blocks that would require extra switches and routing.
Their wordsConventional air cooling is likely limited to around 20 to 30 kilowatt racks, perhaps 50 kilowatts if rear heat exchangers are used.
Their wordsAI servers bring new challenges because many require liquid cooling.
Their wordsThe critical change that makes this all possible is liquid cooling.
Mental modelBottlenecks
Their wordsCheap, lightweight people movers are currently illegal in many situations, so regulation is a barrier.
Their wordsIt should be possible to decrease the weight of a car by 10x without sacrificing speed or internal volume.
Mental modelMargin of safety
Their wordsHumans being awful drivers leads to a massive increase in vehicle costs and weight, makes cars more dangerous to people outside of them, and imposes significant costs on infrastructure like roads.
Their wordsTrucks, vans, and other high mileage vehicles promise to impact oil demand more than EVs.
Their wordsFalling consumer oil demand looks much more like driving the Camry 6000 miles per year instead of 12,000 miles rather than a shiny new electric car in every garage or robot taxis swarming everywhere.
Their wordsDrag and tire friction dominate energy expenditure. Engineering effort to improve drag is worth so much more with electric vehicles.
Their wordsShips are great at carrying bulky and heavy stuff with minimal cost and energy usage. We need a battery chemistry that leans into that and sacrifices performance to reduce cost.
Their wordsHybrid-electric cars are an engineering abomination. They have both gas and electric powertrains, ensuring they are more expensive and complicated than their competitors.
Their wordsReduction in door-to-door travel time is king. Public policy may not keep this in mind.
Mental modelBottlenecks
Their wordsThere is much more space in the air than on the airport tarmac. Our current hub and spoke system means some hub airports operate near runway capacity already.
Their wordsSurprisingly, fuel consumption per passenger mile would be lower in a Celera 500 than in a 737. The larger the fuselage, the harder it is to achieve the same drag reduction.
Their wordsLabor costs are not an excuse!
Their wordsLong lead times and soft costs, fueled by the world-leading US wages for "white collar" work, are the root cause of poor performance in low-volume production because there are few units to spread the soft costs over.
Their wordsThe US excels at high-volume manufacturing, but not low-volume manufacturing.
Their wordsUltra-short lead times are one of the most important features for buyers.
Their wordsReviving manufacturing doesn't require a planned economy, just a better business model.
Their wordsThe changes separated its management and board from the day-to-day processes at the heart of its business.
Their wordsZero tariffs are the best way to help them.
Mental modelSecond-order thinking
Their wordsThese end manufacturers (new and old) are vulnerable to tariffs on their inputs and they are the buyers that the "speed strategy" is relevant for.
Their wordsThey applied the same tax to the components that you need to make things in America that they did to finished goods that were made outside of America.
Mental modelTrade-offs
Their wordsThe CHIPS Act might still be a positive, but the cost is almost certainly many times the $50 billion price tag.
Their wordsIndustrial policy almost inevitably consumes more skilled labor and reduces what we can produce.
Their wordsStockpiles provide insurance while conserving our valuable labor.
Their wordsThe robot arm base case saves some hourly labor at the expense of adding more skilled labor, and can easily be negative if it needs reprogramming more than a few times per year.
Their wordsAutomation will not save us.
Their wordsIt has a surplus of STEM graduates that are often underemployed, while "Hukou" residency restrictions complicate hiring hourly labor in coastal factories.
Their wordsSecond, technologies and market structure are contextual, where the US can't simply emulate China's manufacturing.
Mental modelValue moves to what stays scarce
Their wordsThe key is that robot arms are not labor-replacing, but labor-shifting.