Category: Energy Matters

The twentieth century way of life has been made available, largely due to the miracle of cheap energy. The price of energy has been at record lows for the past century and a half.As oil becomes increasingly scarce, it is becoming obvious to everyone, that the rapid economic and industrial growth we have enjoyed for that time is not sustainable.Now, the hunt is on. For renewable sources of energy, for alternative sources of energy, for a way of life that is less dependent on cheap energy. 

  • Solar power cheaper than expected

    A number of recent articles including Dr. Boreinstein’s study from UC Berkeley and a feature in the Economist questioning the cost effectiveness of solar, have sparked some serious debate amongst solar enthusiasts and have served to propagate false impressions about solar in the public arena.

    Due to the complexity of the product and misconceptions surrounding solar energy, the solar industry could greatly benefit from a collective advertising and branding campaign in order to achieve consistent messaging and dispel widespread myths about solar.

    There is a common misconception that solar is not cost effective because most people compare the cost of distributed solar to wholesale electricity prices. This is an inaccurate comparison since homeowners are actually paying retail electricity prices and not wholesale electricity prices. One can argue that solar is cost effective now if we compare apples to apples.

    The cost of RETAIL electricity in California can run upwards of $.30 to $0.41 cents per kWh for a household with high electricity consumption (a home with an air conditioner, swimming pool, refrigerator, TV, and a few electronic toys). A typical 3kW residential system costs $25,000 without incentives, and will produce 4,500 kWh per year virtually maintenance-free for 25 years. That works out to be 25 cents per kWh for solar — on a residential or commercial customer’s rooftop. With the state rebate and federal tax credit the cost for solar is 18 cents per kWh.

    Despite solar being an obvious smart financial and environmental decision for many home and business owners, daily articles from misinformed journalists claim that solar does not make financial sense. In order to create the drastic shift in the public’s mind a pervasive and cooperative advertising effort on the behalf of all solar players is perhaps necessary.

    In fact, the solar industry could learn a thing or two from the beef, milk, and cell phone industries, who all managed to successfully brand their products into mainstream acceptance via collective advertising and branding campaigns.

    A commodity is a good with very little differentiation. Beef, milk, cell phones and PV are all examples of commodities. When it comes to marketing a commodity, an individual company’s marketing expenditures tend to have a poor return. However, by financing a branding campaign by spreading the cost across the entire industry, every actor in the marketplace pays for and benefits from the increased effectiveness. This strategy minimizes some players’ free-riding on other players’ marketing efforts.

    The 1985 Beef Act, passed by Congress, was designed to promote the beef industry. The Texas Beef Council spearheaded a branding campaign that included the now-famous slogan, "Beef: It’s What’s For Dinner" and financed it with a $1 fee per head of beef cattle. This campaign’s goal was to address the slump during the 1980’s within the beef industry.

    The branding campaign utilized by the beef industry had more than the catchy "Beef: It’s What’s For Dinner," tagline. It also effectively utilized music within the branding campaign. Aaron Copland, an American composer, had originally written "Hoe Down" for the ballet Rodeo in 1942. Now, many people associate the distinctive melody with "Beef: It’s What’s For Dinner." The ads for beef displayed everyday Americans enjoying beef and focused on ease of preparation and the nutritional benefits. The ads typically displayed a family preparing or sitting down to a meal and featured recipes with estimated prep and cooking times that were typically quite short. Through these ads, the beef industry was able to greatly increase its sales and profits by dispelling the unhealthy and difficult-to-prepare reputation that beef had acquired in the early 80s.

    The milk industry has also undergone several branding and re-branding campaigns as it sought to carve its own brand identity. In the past, milk ads used the tag line, "It Does a Body Good," to emphasize the health benefits of milk.

    The next generation of milk ads started with the "got milk?" campaign. The first "got milk?" ad was a television spot in which a fellow with a shrine to the Alexander Hamilton – Aaron Burr duel hears a radio promotion asking, "Who killed Alexander Hamilton?" He phones into the contest, gets through, and tries to answer "Aaron Burr," but his mouth is full of sticky peanut butter. Because he is out of milk and cannot wash down the peanut butter, his answer is completely intelligible. As he screams in frustration from losing out on the large monetary prize, the words: "got milk?" flash on the screen.

    Milk print ads briefly went to the "where’s your mustache?" tagline, but that was dropped in favor of the more memorable "got milk?" tagline. These ads combined the memorable phrase with milk mustached celebrities, athletes, and other notables.

    The branding of milk emphasizes the health benefits that result from milk consumption. Among the many benefits milk provides are the multiple essential nutrients to promote strong bones and shiny, healthy hair. Awareness of the "got milk?" branding campaign rates over 90% nationally, making it a highly successful brand.

    It is not just the milk and beef industries that have been transformed through branding campaigns. The high tech industry has also successfully used this approach with cell phones. It wasn’t until 1984 that cellular phones were first mass marketed to the general public. It was a technical marvel by which people could reach into their pockets and simply make a call to someone — anywhere in the world. This new wireless gadget was bulky, expensive to operate (compared to nowadays) and back then seemed like just another toy on the wish list of those who had money. The aggressive branding campaigns from the cellular companies successfully branded the expensive cell phones into must-haves for mass consumers.

    All three industries have effectively used branding to increase awareness of their product as well as the industry as a whole. Instead of putting so much emphasis into nickel and diming the cost effectiveness of solar, perhaps the solar industry would be best served by utilizing a collective branding effort in order to bring solar to the mainstream.

  • US Ethanol laws create energy vortex

    On 15 April the Renewable Transport Fuel Obligation (RTFO) Programme is supposed to come into effect. What this silly government programme will do is introduce a 2.5% requirement of biofuels at the pumps, a figure that will rise to 5.75% by 2010 and 10% by 2020.

    The government has set up a commission to review the effectiveness of biofuels. The review was commissioned in February by transport Secretary Ruth Kelly. It still hasn’t reported. Will our government wait until it has the full facts before it acts? Probably not.

    Water crises

    According to the Stockholm International Water Institute, agricultural demand for water will double by 2050, largely due to the anticipated needs of the biofuels sector. This is an utterly crazy plan when water crises are going to be a major theme of the next 20 years. There are meetings being held this week in Cyprus, Israel and India as water supplies have become critical.

    It takes around 3-4 gallons of water to produce one gallon of ethanol and using ethanol to power the average US car for one year would require a staggering 11 acres of farmland. This works out to be the same area needed to grow a year’s supply of food for seven people, according to David Pimentel a leading agricultural expert from Cornell University.

    It just doesn’t make sense

    Pimentel calculated that an acre of US corn can be processed into about 328 gallons of ethanol. But planting, growing and harvesting that much corn requires about 140 gallons of fossil fuels and costs $347 per acre. That is $1.05 per gallon of ethanol before the corn even moves off the farm. Then there’s fermentation: as many as three distillation steps and other treatments are needed to separate the ethanol from the water.  

    So, adding up the total energy costs of corn production and its conversion to ethanol, 131,000 British thermal units (BTUs) are needed to make 1 gallon of ethanol, which has an energy value of only 77,000 BTU.

    A net energy loss?

    So, 70% more energy is required to produce ethanol than the energy actually in ethanol. Every time you make 1 gallon of ethanol, there is a net energy loss of 54,000 BTU. Fans of ethanol as a fuel need to answer just one question – if producing biofuels is so cost effective, why on earth does their production require government subsidies?

    I really do despair over this issue. I strongly believe that biofuels will continue to exacerbate rises in agricultural commodities as long as these targets remain.

    Food shortages

    Will the UK stand up to Europe and force the targets to be abandoned? Probably not; it does not have the guts. Will the US government slash its ethanol targets? I doubt it; there are too many vested interests.

    All of this means that food will be in tight supply for many, many years. Energy policy has always been a politically charged affair – but it is getting more and more political as each week passes. Can we trust here-today-and-gone-tomorrow politicians to get the long-term strategy right?

    Unfortunately, I don’t think so.

    This article is taken from Garry White’s free daily email ‘Gary Writes’.

  • The Limits of Distributed Energy

    by Michael Hoexter, Ph.D.

    On a rainy January day in Sacramento, I attended a plenary meeting of California’s Renewable Energy Transmission Initiative. At one point, a smartly dressed man from one of the largest rooftop solar finance companies got up to tout the benefits of distributed energy, harping on the drawbacks of high-voltage transmission. Given the backlog of renewable energy projects in California requiring transmission, it was kind of amazing that he had bothered to come to a remote corner of the city to speak against the cause of his renewable energy brethren, an initiative that has zero impact on his firm. Needless to say, next time any of the assembled had a customer referral they would not be turning to this company.

    Distributed energy will continue to grow in importance and popularity, but alone it is insufficient to address the climate crisis.

    While not all renewable energy company reps are so tone-deaf, the practice of selling distributed energy projects in opposition to all utility scale or central station power projects is outdated and an aid to the continuing dominance of fossil fuels in our electric system.

    Distributed energy will continue to grow in importance and popularity, but alone it is insufficient to address the climate crisis. Large-scale renewable power in combination with aggressive energy efficiency and distributed generation will be absolutely necessary to meet the very ambitious GHG reduction and energy independence goals that we are setting for ourselves.

    There are many in the RE community, some frequent commenters here, who have embraced the dream of renewable energy in which communities or individual buildings would become energy self-sufficient or even net energy producers. This dream will probably become reality on a broad scale at some point in the future, but unfortunately not fast enough to cut GHG emissions rapidly when we need it most. This is not for a lack of trying by technology firms, as there is big money and much glory involved in more cost-effective and productive distributed technologies.

    Some fans of self-sufficiency are willing to devote time, mental bandwidth, and money to set themselves up to live off the grid (or live in remote areas anyway). But most of the population is either not inclined to live this way nor in the position to act on the inclination. The ideal of autarky is not everybody’s social or energy utopia; however, a substantially more energy-efficient lifestyle and built environment is, in my book, a categorical imperative.

    Currently, grid-tied distributed generation is the far more user-friendly option. A hidden component of the argument for these systems is “grid storage,” the notion that when your system isn’t producing energy, the grid will supply you with the energy that you need.  Unfortunately, that grid is emitting some of the GHGs that you may be trying to avoid with your distributed generation system, especially in areas with coal-fired baseload, a fairly common situation in the sunny Southwest or windy Great Plains.

    Well, now is the time to start thinking about cleaning up that “grid storage.” We can, through a combination of new geothermal, concentrating solar power with storage, small and medium hydro, concentrating photovoltaics (PV), regular PV, wind, marine renewables and pumped hydro, reduce the carbon footprint and therefore the ecological footprint of the grid. To clean up the grid means building some transmission lines (though less will need to be built if we build generation in areas with stronger renewable energy flow).

    As it turns out, even if we follow the very favorable policy conditions for distributed and large-scale renewable energy found in Germany, most energy will be generated in large installations, owned by cooperatives or by corporations, and those installations will cost less per unit of energy. Much to the chagrin of some people, a lot of those larger projects may need to be cited on undeveloped land.

    The people holding onto the ideal that power generation should be exclusively on developed land are avoiding the tough choices and inevitable compromises involved in building renewable generation facilities. They complain about the visual impact of wind turbines, solar farms or transmission lines without offering a realistic present day alternative that they and we will be able to afford.

    Choices within the area of transmission lines provide a graphic example of a tradeoff: Overhead transmission lines are about one tenth the cost of underground transmission infrastructure. Do you want to pay perhaps three or four times as much for electricity for this luxury? Nature does not just put electrical energy on tap, even if you own a renewable energy system; it takes various industrial and construction processes that cost money and involve compromises to bring you that power.

    Knee-jerk criticisms of the transmission system and utilities (sometimes found in the pages of this publication) flirt with a similar form of moral hazard. The utilities and grid operators, historically relying most on large-scale power plants, work to respond to our demand for electric power and the conveniences it offers us. In combination with related government agencies and transmission authorities, they have invested in and manage a huge infrastructure that is sending us the power that makes it possible for us to communicate, eat fresh food, get safe medical care, and move around safely. They have figured out ways to do this with a high level of efficiency and service, though unfortunately with fuels that are now endangering our climate. Some critics speak as if it is a breeze to reproduce this service on a smaller scale. This, I believe is either wishful thinking or ignorance.

    As Pogo said:  "We have met the enemy and he is us."

    So think carefully when you declare distributed energy the only solution: Is this going to be the sole road via which we transition from a fossil fuel to a renewable energy economy?  Have you figured out what the costs and availability of generation and storage are that will allow us to energize the devices that we need or want to use, individually and as a society? If you do the calculations, you will realize that developing judiciously sited central station renewable energy plants, new transmission lines, clean storage and ancillary services, as well as distributed generation is the only way we as a society are going to stop climate change while keeping our impact on the earth to a minimum.

    Michael Hoexter, Ph.D., a renewable energy and energy efficiency advocate, has helped California utilities implement and market energy and resource efficiency programs. His views on the transition to a sustainable energy economy and the valuation of energy and energy services can be found at www.greenthoughts.us.

  • US Electricity Executive calls for end to coal

    Scott Bilby:I’d like to start off by just trying to let people know, that because in Australia, we’re still being told the same thing that you’re being told in the US, that renewable energy is basically a sideline cottage industry, we know it can go commercial scale and very quickly, so can you just quickly give us a little bit of information about you’re background, and how you know that we can move too commercial scale renewable energy pretty soon.

    David Freeman:Well I have been a utilities executive most of my life, and when I was chairman of the Tennessee Valley Authority, which is a utility much larger than anything in Australia, we were buying thirty million tones of coal a year, so I know a bit about coal, and the one thing I do know for sure is that it is not clean, it is dirty, and that anyone who tries to tell you differently is just speaking falsehoods.

    Australia has more solar energy than it has coal. I think the misleading impression that has been left is that the existing energy industry has plenty of money and they advertise on television and elsewhere, and they’re trying to leave people with the impression that they are essential and the sun and the wind and growing things are just small bits of energy, very diffuse and kind of a sideline.

    Scott Bilby: That’s a good way of putting it

    David Freeman: The opposite is true. Obviously there would be no life on this earth without the sun, but the energy that we can use from the sun every day, coming down free of charge is enormous, and more, much more than enough to meet our needs, and its inexhaustible.

    So basically, this civilization of ours is using what I call the three poisons, coal, oil and nuclear power, and we haven’t put our minds and our money into developing the much larger sources of energy, namely the renewables, and over time the renewables are cheaper than the coal. The problem is, the price of coal does not include all of its costs. It doesn’t include the health effects on people just from ordinary air pollution. It doesn’t include the risk to the whole society of global warming, and it doesn’t include the risks of a third world war, or people being blown to smithereens by a nuclear blast. In an age of terror, you know, shifting to nuclear power is like going out of a frying pan into a radioactive fire. So we have a lot of learning to do and we need for the next generation to recognize that we’re in a life or death struggle for the survival of the civilization that we have now, and we have just got to raise the bar on the solution package.

    I think that we’ve made progress in understanding the problems with the help of people like Al Gore and others that have hammered home the danger, but we need the equivalent of an Al Gore on the solutions side, and to combat the propaganda of the existing purveyors of poison.

    Matthew Wright: David, it seems certainly that our government, and we saw it a couple of nights ago on lateline which is an Australian Broadcasting Corporation nation wide television program where our climate change minister, Penny Wong continually said and implied that there’s no solutions to climate change without clean coal. Now I understand that with you’re knowledge, and maybe you can tell us a bit about how you’ve worked with coal, the coal mining industry and running coal power stations, and what you think of this idea of so called ‘clean coal’?

    David Freeman: Well look, I mentioned just a moment ago I was the head of the Tennessee Valley Association under President Carter. We had a lot of coal fired power plants. Coal is inherently filthier than dirt, and anyone that uses the phrase ‘clean coal’ is misleading, either deliberately or otherwise, misleading the public. It is the most carbon intensive of all the fuels, so when you burn it you are emitting more carbon into the air than if you were burning anything else. But then the local air pollution from burning coal, is well understood but we’ve become complacent about it. It’s the fine particulate matter from coal that goes past you’re nasal passages into the deep recesses of you’r lungs, and into your bloodstream. It’s a killer. And coal contains all sorts of things like mercury, lead etc, that are not even controlled, so the phrase ‘clean coal’ is oxymoronic, it is just blatantly false, and the reason they’re getting away with it is that people do not see and touch coal any more.

    When I was a kid, coal was used in furnaces at home, and when you had to stoke the stoker, you knew how dirty coal was. Nowadays the coal piles are in remote locations at power plants. We’ve stopped using coal for heating in the home because it’s so damn dirty, and filthy and polluting. So you know there is a river in Egypt that flows all over the world, it’s called denial, and I think that some people in the coal business, beholden to the coal industry, are in denial.

    That’s just a fact and we certainly have alternatives, in fact it’s interesting, we have an Australian company that’s come over here with marvelous new technology for large solar power plants that are very economical.

    Scott Bilby: We’ve actually interviewed David Mills here on this show.

    They’ve built a plant in Australia, they’re building a larger version here. The photovoltaic technology is being supplemented by technology where we simply heat oil and make electricity in an ordinary steam turbine with the sun. And if you look at the cost to society, coal is the most expensive thing on earth, and solar power is the cheapest.

    Matthew Wright: Absolutely, and that technology from David Mills, for our listeners, they can log onto our website at beyondzeroemissions.org, and we’ve interviewed David Mills and just the other day he released a study which we will also have on the website , that [says] you can run 90% of America on solar thermal technology. Perhaps you can tell us about that?

    David Freeman: Well Ausra, the company that’s making a name for itself in America, and hopefully will also make a name for itself in it’s native land of Australia.

    Matthew Wright: We hope so too and of course we have a fantastic solar resource. So it’s always mind blowing to us that we seem to invent all the solar technology and then the scientists leave and it gets commercialized in Germany, China or the United States, so for Australian’s it’s a very difficult one to understand and obviously those vested interests are whats causing this problem.

    David Freeman: There’s not much doubt about that and I took civil engineering and I’ve worked with engineers, there’s a tendency to want to build tomorrow what you built yesterday because you’re very comfortable and people that suggest something new kind of ruffle the feathers of engineers who know who’ve been building coal fired plants and they view it as a threat. And with all due respect the most imaginative of the engineering profession did not go into the electric power business, they’re into electronics and other things where they’re making a bundle. We have resistive behavior and that’s not peculiar to just America or Australia or any country. And so we have to overcome it and that means that programs like this are very very important to educate people to what can be done because unless the people know that there is an alternative it is not likely to take place, because the vested interests, like one senator once told me when I was working for the US Senate, he said I was suggesting some amendments to a bill involving the oil industry and he said son this Senate has not been bought but it has been rented on this issue and you’re wasting my time. And the influence of money on politicians no matter what country you’re in is enormous and there’s a brainwashing factor to it, I mean people tend to believe what they say because it helps them with their campaign contributions and other things, I’m not saying it’s criminal I’m just saying it’s a fact of life and it has to be overcome. By the public raising the issue in an unmistakable manner.

    Matthew Wright:In Your book Winning Our Energy Independence: An Energy Insider Shows How You said that with lignite and as the head of the biggest power authority in the United States the Tenessee Valley Authority. You said that you had actually gone and ended some ideas about mining lignite, funnily enough in Victoria Australia we have some of the world’s biggest lignite reserves. And unfortunately we stripmine that and run 90% of our electricity on that. Is that something we want to be doing?

    David Freeman:It’s near coal, it’s very low grade coal, and I don’t know what the quality of the lignite is in Australia and it is by its nature less energy intensive and more pollution intensive even than coal and I’m very proud of the fact that when I was the head of the utility near Austin Texas we stopped the lignite mine before it got started even though they’d already bought the equipment. It’s a travesty of major proportions for an area that has got such enormous solar power like Australia to be burning coal or lignite, now I’m a utility executive I’m a realist you can’t just shut down everything you’ve got overnight, but you could have the law in Australia that says from this day forward that says there will be no new coal fired plants, no new lignite plants, no new nuclear plants and that all of the future belongs to the Sun and the Wind and efficiency measures. That’s what we’ve got to do all over the world and there’s no point in pointing the finger at the Chinese or anyone else unless we start showing an example that they can follow and I think that if we did they would.

    Mark Ogge: …

    The Green Cowboy – S. David Freeman’s official website

    UC Berkeley: Conversation with S. David Freeman (4 Realplayer Videos)

    UC Berkeley: Conversation with S. David Freeman (Youtube Version)

    BrightCove TV: Interview with S. David Freeman (Part 1)

    BrightCove TV: Interview with S. David Freeman (Part 2)

    David Freeman talks on the security risk to Israel from United States dependency on Oil

    David Freeman debates – Can the Ports Clean the Air Without Choking the Economy?

    David Freeman addresses Sustainability Conference 2007

    Winning Our Energy Independence Part 2 of 2

    EVWorld: Winning Our Energy Independence – Interview background and synopsis

    EVWorld Podcast: Interview with David Freemand

  • Denmark launches wind-powered car

    Shai Agassi says in the press release: “Together with DONG Energy, Project Better Place will ensure an environmentally clean and sustainable approach to energy and transportation. Existing technology, combined with our unique business model and scaleable infrastructure will provide a financially viable solution to significantly decrease CO2 emissions.”

    DONG Energy CEO Anders Eldrup comments that the project opens up a new avenue for storing surplus electricity from wind turbines, since EVs are typically charged at night when the exploitation of available power is generally low. Project Better Place is particularly well suited to Denmark, since the country generates a significant proportion of its electricity from renewable energy sources, and leads Europe in its use of wind energy.

     
    The initial contact between Project Better Place and DONG Energy was originated by Invest In Denmark. Both businesses are members of the Copenhagen Climate Council, a multidisciplinary forum with members from all parts of the world, working on establishing a global agreement at the UN Climate Change conference (COP15) to be held in Copenhagen in 2009.
     
    ”It is interesting that Better Place has chosen Denmark as a ’proof of concept’ test market and probably also the future location for launch of the environmental project. This places Denmark on the world map once again as an innovative and environmentally friendly country where advanced and sustainable energy projects are being developed,” says Ole Frijs-Madsen, Director of Invest in Denmark under the Ministry of Foreign Affairs.
     
    ”Invest in Denmark identified the project early in 2007, after which we contacted the initiator Shai Agassi and began dialogue regarding the Better Place project. This dialogue resulted in a visit in August 2007, when Agassi met representatives from municipalities and ministries, in addition to commercial partners including DONG Energy. It is good to see that the efforts are now resulting in Denmark becoming the first European country where the electric car concept will be launched – and we look forward to following the development of a collaboration that potentially can benefit the Danish environment, Danish jobs and the Danish environmental profile abroad,” says Ole Frijs-Madsen.
     
    Link > DONG Energy  
     
    Link > Project Better Place   
  • Clean-Energy Trends 2008

    Further proof of clean tech’s move from marginalized to mainstream is abundant. A growing number of governments announced plans to generate electricity from renewables. Corporations continued to jump on, if not lead, the race to transition to a cleaner, greener economy. Venture capitalists in the U.S. invested $2.7 billion in the clean-energy sector, representing more than 9 percent of total VC activity. Cleanenergy indices outpaced the broader markets in 2007. For example, the NASDAQ® Clean Edge® U.S. Liquid Series index (co-developed by Clean Edge and NASDAQ) was up 66.67 percent last year, compared with 3.53 percent for the S&P 500 index and 9.81 percent for the NASDAQ Composite index.

    According to Clean Edge research:

    • Biofuels (global production and wholesale pricing of ethanol and biodiesel) reached $25.4 billion in 2007 and are projected to grow to $81.1 billion by 2017. In 2007 the global biofuels market consisted of more than 13 billion gallons of ethanol and 2 billion gallons of biodiesel production worldwide.
    • Wind power (new installation capital costs) is projected to expand from $30.1 billion in 2007 to $83.4 billion in 2017. Last year’s global wind power installations reached a record 20,000 MW, equivalent to 20 large-size 1 GW conventional power plants.
    • Solar photovoltaics (including modules, system components, and installation) will grow from a $20.3 billion industry in 2007 to $74 billion by 2017. Annual installations were just shy of 3 GW worldwide, up nearly 500 percent from just four years earlier.
    • The fuel cell and distributed hydrogen market will grow from a $1.5 billion industry (primarily for research contracts and demonstration and test units) to $16 billion over the next decade.

    Together, we project these four benchmark technologies, which equaled $55.4 billion in 2006 and expanded 40 percent to $77.3 billion in 2007, to grow to $254.5 billion within a decade.

    U.S Venture Capital Continues to Grow and Grow

    U.S.-based venture capital investments in energy technologies more than quadrupled from $599 million in 2000 to $2.7 billion in 2007, according to New Energy Finance (with supporting data from Clean Edge and Nth Power). As a percent of total VC investments, energy tech increased from .6 percent in 2000 to 9.1 percent in 2007. Between 2006 and 2007, venture investments in the U.S. clean-energy sector increased by more than 70 percent.

     

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