Simple Ideas, Robust Evidence, Part 4: Putting the World’s Best Heating System on People’s Homes for Free
The most brilliant and benevolent business strategy that I ever heard of
The father of thermodynamics is Sadi Carnot. In 1990, I spent a couple of months studying thermodynamics and Mr. Mentor’s and Victor Fischer’s engine patents. I have presented the Carnot equations, which describe the maximum theoretical efficiencies of heat engines and heat pumps; they are two sides of the same coin. The Carnot equations are learned in the first week of thermodynamics classes. They are very simple.
Over the centuries since Newcomen’s steam engine, most research was devoted to making heat engines more efficient. Today, the best heat engines get about half of the Carnot ideal. Heat engines take advantage of temperature differences, which move heat to produce work, and a little over 40% efficiency in turning heat into work (called “thermal efficiency”) is the top that is achieved today.
Today’s heat pumps work in the opposite way, by using work to move heat. A refrigerator in a home is a heat pump, but that refrigerator works to remove heat from inside the refrigerator and expel that heat into the kitchen, thereby keeping the refrigerator’s interior cold. The standard residential heat pump uses work to move heat from outside of a home to inside it, to warm the home. The heat pumps touted today as some kind of energy solution are very primitive contraptions when compared to heat engines.
While the best heat engines get half of the Carnot ideal, today’s heat pumps get a little over 10% of the Carnot ideal. Well, not all of them, and this is where Dennis Lee comes in. One look at today’s heat pumps (called “air-to-air” heat pumps, as they take heat from air and exhaust it to air) makes it obvious why they perform so poorly when compared to heat engines. The component that collects the heat from the environment is a tube-and-fin array that looks like an automobile radiator. It is called an evaporator, as that is where the refrigerant evaporates from liquid to gas and absorbs heat as it does so (through the “latent heat of vaporization”). It provides a few square feet of evaporator contact with the environment. Like with car radiators, a fan blows air across the heat-pump evaporator to increase the heat exchange. Just like they did 50 years ago, because the basic design has not changed, for every unit of energy used to run the heat pump, two units of heat are delivered into the home. That is called a “coefficient of performance” (AKA “COP”) of two.
The heat pump that Dennis stumbled into in the 1970s was radically different, in the best way. Instead of that little fin-and-tube array, that heat pump had huge, flat panels that the refrigerant ran through, with many times the refrigerant that runs through air-to-air heat pumps. Those panels provided several hundred square feet of evaporator contact with the environment and worked even while buried under snow, while air-to-air heat pumps become worthless in freezing weather as the evaporator ices up and air can no longer blow through it. Obviously, that would mean that far more heat would be extracted from the environment with Dennis’s heat pump. It was, but more importantly, that huge evaporator meant that the heat pump became more efficient. Instead of a COP of two, while delivering 50,000 BTUs per hour of heat into the home, that flat-plate-evaporator heat pump regularly got COPs of five and six while delivering 100,000 BTUs per hour of heat into the home, and I have seen at least a COP of 12. Instead of a crappy 12-13% or so of the Carnot ideal that air-to-air heat pumps get, Dennis’s heat pump got about 40% of the Carnot ideal – not far from the best heat engines. Dennis’s heat pump also worked better in sunshine and wind, taking advantage of enhanced heat exchange, while air-to-airs did not, which is also why Dennis’s heat pump qualified for Jimmy Carter’s tax credit.
In my work, I have presented the data from several scientific tests (1, 2, 3, 4) that showed those high COPs. In the last one in that list, after we were raided, when the deputies stole our technical material by cleaning out Mr. Researcher’s office, those deputies then lied to and intimidated the scientific laboratory that performed that test, to ensure that their test results would never be entered into evidence during Dennis’s prosecution. The prosecution was planning to “prove” that not even Dennis’s heat pump worked, and banning all scientific data from the farce of a kangaroo-court trial was their strategy, which I planned to throw a monkey wrench into.
When Dennis stumbled into that heat pump, it was a similar situation to the foam-insulation business that Dennis was involved with: it was stuck at the craftsman stage. Dennis tried to industrialize that business, from a man and a bucket, hose, and foam mix to a computerized “battlewagon” that could insulate an entire neighborhood in a day. When Dennis got involved with that heat pump, half of the buyers installed it themselves. With that kind of nonexistent quality control, most of those heat pumps did not work very well. Dennis professionalized the installation and had the idea of fabricating the panel arrays at the factory and eliminating installation issues. He got that idea just as his company was being wiped out in Seattle, in the greatest attempt ever made to bring alternative energy to the marketplace.
Capitalist ideology elevates greed to a virtue, and greed-blinded idiocy describes most small-time capitalist waters. Many of Dennis’s business associates were blinded by their greed and thought that if they just stole Dennis’s companies that they jumped on the gravy train. The Mafia was constantly trying to muscle in, but his business partners were worse. When I became Dennis’s partner (and even before), I saw many attempts to steal our companies, which was initially shocking before I came to realize that it was normal.
There is no credible argument against the idea that Dennis’s heat pump was the world’s best heating system. It still is. It produced heat at less than half of the energetic cost of fossil-fuel heating, and at less than 20% of the energetic cost of electric heating. What I presented above is plenty to understand that. But that was not the greatest brilliance that Dennis brought to it. Industrializing a business stuck at the craftsman stage was brilliant by itself, but Dennis’s marketing and financial-engineering genius was the gold in what he did, and virtually none of his business associates understood that, as they were blinded by their greed.
When Dennis got involved, the company that invented and made that heat pump sold them for $12K, and they qualified for Jimmy Carter’s $4K tax credit. So the customer was risking $8K on a new technology that, if it was not installed properly, would not work very well and not save much money. Dennis dropped the price to $8.5K and he unveiled his shared savings program that he had invented earlier. Dennis soon discovered that the direct costs of making, selling, and installing the heat pump were less than $4K, which was the tax-credit amount.
Dennis’s program became to sell the heat pumps for $10K, get a downpayment from the customers for $4K, which they would receive a refund for when they filed their tax returns, and the remaining $6K would be paid from proven energy savings. The customers had no risk. If the equipment did not work, it costed the customers nothing. It is the most brilliant and benevolent business strategy that I ever heard of, and his greed-blinded business associates never understood.
Whereas that original company had not sold 20 of those systems in the previous three years on the entire East Coast, Dennis sold 280 in his first month in one county in Delaware. That was how explosive Dennis’s programs were, but they inspired the greed of his associates, who constantly schemed to steal his companies. And every time that they were successful, the first thing that they did was discard Dennis’s “crazy” marketing plans, without realizing that those marketing plans were what made the entire business work. They were killing the golden goose.
But not everybody was infected with greed-blinded idiocy. The chairman of the board of American Express understood and was about to commit $1 billion to carpet the USA with Dennis’s heat pump and marketing plan when Dennis’s business associates stole hundreds of thousands of dollars from Dennis and the Mafia stole his company. Dennis narrowly escaped being murdered multiple times in those early entrepreneurial days. John Spickard, the founder of a finance company, also understood and committed $10 million to Dennis’s ingenious program. Being a student of genius from a young age, with my business background, I easily understood what Dennis did. Almost nobody else ever did.
This is all very simple, but in my nearly 30 years of interacting with the public, I have never had a robust discussion of Dennis’s heat pump, have never had any kind of discussion about Mr. Mentor’s and Fischer’s engines, and I have never had any discussion about Dennis’s ingenious marketing plans. Not one of Dennis’s innumerable assailants over the past 40 years has ever had any kind of rational discussion of these issues. If I can’t even have discussions about pretty mundane technologies, from a physics standpoint, I certainly will never have productive discussions of free-energy physics, which is one reason why I avoid them. I already know that free-energy technology is older than I am, and scientists with their free-energy theories hold little interest for me. If people want to stretch their free-energy-physics muscles, they can read Sparky Sweet’s papers. Sparky had the goods and came to a grim end because of it.
What I presented above is not complicated, and the people that I seek need to understand at least the basics. That is all part of developing a comprehensive perspective, and I am here to help them.