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CHAPTER RESOURCES Reading Content Introduction 11.1 Technology as Physical Infrastructure 11.2 Technology of Information Infrastructure 11.3 Technology of Human Infrastructure 11.4 Technology Trends in International Business Summary and Case ORION: Build your

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PRACTICE Chapter 11 Reading Quiz

APPENDIX

11.1 Technology as Physical Infrastructure

LEARNING OBJECTIVE

Assess the impact of physical infrastructure on international business opportunities

Beginning with the inventions of the wheel, irrigation, and writing, technological improvements have been responsible for countless changes to the way we live and trade. For global business leaders, knowing how to understand, evaluate, and harness technological trends at the global and country levels is an increasingly important skill. In this chapter, we introduce a framework to help you understand the impact of technology and technological changes on the global enterprise and how global leaders can capitalize on these opportunities. This framework consists of physical infrastructure, information infrastructure, and human infrastructure (see Figure 11.1).

FIGURE 11.1 Assessing the level of physical infrastructure Physical Infrastructure includes raw materials, manufacturing equipment, transportation networks, and energy resources.

International businesses must consider an important factor: the level of physical infrastructure present in a given country. Countries with low levels of physical infrastructure may be less attractive to international businesses because producing and distributing goods and services are often difficult. Countries with high levels of physical infrastructure, however, present fewer challenges for international businesses.

The physical infrastructure includes elements such as the availability of raw materials like plastics, metals, and minerals; the availability of machinery and equipment like weaving looms for textiles, precision weighing and mixing equipment for pharmaceuticals, and metal stamping and welding equipment for automobiles; transportation networks that enable goods to move between producers and customers; and the energy resources that provide power to producers and consumers alike. Key questions for assessing the physical infrastructure are shown in Figure

For instance, when Hindustan Unilever—a global seller of soaps, shampoos, and lotions—sought to move from urban cities to rural towns in India, it quickly recognized a problem. Competition was fierce in urban India, but while the country had over a billion potential customers, getting products to the half who lived in rural villages would be exceptionally challenging because of the country's undeveloped physical infrastructure. The lack of roads made transportation burdensome, the very small number of large retail stores made distribution channels difficult to establish, and a general lack of information made monitoring the distribution process nearly impossible.

In assessing the physical infrastructure of a market, global leaders need to consider a host of factors, including access to raw materials, manufacturing capabilities and techniques, transportation networks, and energy resources.

Raw Materials

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DOWNLOADABLE eTEXTBOOK

CHAPTER RESOURCES Reading Content Introduction 11.1 Technology as Physical Infrastructure 11.2 Technology of Information Infrastructure 11.3 Technology of Human Infrastructure 11.4 Technology Trends in International Business Summary and Case ORION: Build your

Proficiency Videos Animations Multimedia Study Tools Business Hot Topics

COURSE RESOURCES

Career Center Business Hot Topics Videos Animations

PRACTICE Chapter 11 Reading Quiz

APPENDIX

11.1 Technology as Physical Infrastructure

LEARNING OBJECTIVE

Assess the impact of physical infrastructure on international business opportunities

Beginning with the inventions of the wheel, irrigation, and writing, technological improvements have been responsible for countless changes to the way we live and trade. For global business leaders, knowing how to understand, evaluate, and harness technological trends at the global and country levels is an increasingly important skill. In this chapter, we introduce a framework to help you understand the impact of technology and technological changes on the global enterprise and how global leaders can capitalize on these opportunities. This framework consists of physical infrastructure, information infrastructure, and human infrastructure (see Figure 11.1).

FIGURE 11.1 Assessing the level of physical infrastructure Physical Infrastructure includes raw materials, manufacturing equipment, transportation networks, and energy resources.

International businesses must consider an important factor: the level of physical infrastructure present in a given country. Countries with low levels of physical infrastructure may be less attractive to international businesses because producing and distributing goods and services are often difficult. Countries with high levels of physical infrastructure, however, present fewer challenges for international businesses.

The physical infrastructure includes elements such as the availability of raw materials like plastics, metals, and minerals; the availability of machinery and equipment like weaving looms for textiles, precision weighing and mixing equipment for pharmaceuticals, and metal stamping and welding equipment for automobiles; transportation networks that enable goods to move between producers and customers; and the energy resources that provide power to producers and consumers alike. Key questions for assessing the physical infrastructure are shown in Figure

For instance, when Hindustan Unilever—a global seller of soaps, shampoos, and lotions—sought to move from urban cities to rural towns in India, it quickly recognized a problem. Competition was fierce in urban India, but while the country had over a billion potential customers, getting products to the half who lived in rural villages would be exceptionally challenging because of the country's undeveloped physical infrastructure. The lack of roads made transportation burdensome, the very small number of large retail stores made distribution channels difficult to establish, and a general lack of information made monitoring the distribution process nearly impossible.

In assessing the physical infrastructure of a market, global leaders need to consider a host of factors, including access to raw materials, manufacturing capabilities and techniques, transportation networks, and energy resources.

Raw Materials

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Ships

Raw Materials Raw materials are the basic materials from which goods and components of goods are made. While many raw materials are abundant around the globe—such as the elements oxygen, silicone, aluminum, and iron—others are rare enough that companies' needs for them can influence global business decisions. For instance, many of today's batteries are lithium-ion batteries. Bolivia and Chile control nearly half the world's supply of lithium. This means foreign companies may struggle to gain access to an ample supply. They may not need to move to Chile or Bolivia, but managers of international companies should certainly build healthy trade relationships with Chilean and Bolivian suppliers and governmental officials.

Often, governments will use access to raw materials as a source of advantage for their domestic companies. For instance, a RAND Corporation report suggests that China, which controls nearly 90 percent of the world's rare earth elements, charges global electronics firms much higher prices than what domestic Chinese competitors pay for rare earth elements such as lanthanum and cerium, which are often used in electronics (see 11.1). As a result, Chinese electronics firms may have a significant cost advantage in addition to preferred access to critical elements. In addition, China's near monopoly has forced other countries to develop alternative approaches that work around the requirements for some elements. For instance, when China cut off sales of rare earth elements to Japan in 2010 during a spat over the fate of Chinese fishermen who were caught fishing in Japanese waters, Japan, among other nations, began seriously investing in finding alternative materials that could substitute for rare earth metals.

TA B L E 11 . 1 China's Two-Tiered Pricing of Rare Earth Elements

Material International Prices (USD/kg) Chinese Domestic Prices (USD/kg)

Lanthanum  66.46  18.28

Cerium  59.31  20.65

Neodymium  244.23  122.76

Praseodymium  209.62  106.94

Samarium  95.31  14.48

Dysprosium 2032.31 1085.35

Europium 3800.00 2228.38

Terbium 2973.85 1767.93

Source: Richard Silberglitt et al., “Critical Materials: Present Danger to U.S. Manufacturing,” RAND National Defense Research Institute, www.rand.org/content/dam/rand/pubs/research_reports/RR100/RR133/RAND_RR133.pdf.

Manufacturing Equipment In the past decade, the advances of new manufacturing equipment and techniques have changed many global industries. For instance, horizontal drilling allows vertical wells to twist and turn horizontally for over a mile underground. Coupled with hydraulic fracturing (in which a high-pressure solution is pumped into a well to crack the rock and release nearby pockets of hydrocarbons), this technique has increased production of natural gas from shale gas to more than eight times the rate of any earlier technologies. This capability reduces the bargaining power of OPEC producers, significantly altering the global oil and gas industry. This is just one example of how new technologies can overturn commonly held beliefs in any sector, even manufacturing.

Another manufacturing innovation with a dramatic impact on global business is the creation of global manufacturing clusters, suppliers and producers of a given industry in the same geographic location. This proximity facilitates the free flow of ideas, people, and resources between firms and for well-designed hubs often results in global dominance. For instance, in Silicon Valley, tech firms cluster together, attracting talent, investors, and ideas from around the world. Similarly, Italy is the world's center for leather craft and high-end automobiles. center of the fashion industry. South Africa is the center of the world's mining industries. China is the center of the world's garment industry. rules exist that require new businesses to locate near the existing ones in their industry, but new entrants are still likely to benefit from proximity to them.

Transportation Networks Transportation technologies play a vital role in the success of international businesses. Transportation, whether between production facilities or from supplier to customer, relies on a network that links shipping, air, rail, and road; in the not-too-distant future it may even include delivery drones.

Perhaps the most important technological advancement in the transportation industry in the past twenty years has been the invention of the

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Ships

Raw Materials Raw materials are the basic materials from which goods and components of goods are made. While many raw materials are abundant around the globe—such as the elements oxygen, silicone, aluminum, and iron—others are rare enough that companies' needs for them can influence global business decisions. For instance, many of today's batteries are lithium-ion batteries. Bolivia and Chile control nearly half the world's supply of lithium. This means foreign companies may struggle to gain access to an ample supply. They may not need to move to Chile or Bolivia, but managers of international companies should certainly build healthy trade relationships with Chilean and Bolivian suppliers and governmental officials.

Often, governments will use access to raw materials as a source of advantage for their domestic companies. For instance, a RAND Corporation report suggests that China, which controls nearly 90 percent of the world's rare earth elements, charges global electronics firms much higher prices than what domestic Chinese competitors pay for rare earth elements such as lanthanum and cerium, which are often used in electronics (see 11.1). As a result, Chinese electronics firms may have a significant cost advantage in addition to preferred access to critical elements. In addition, China's near monopoly has forced other countries to develop alternative approaches that work around the requirements for some elements. For instance, when China cut off sales of rare earth elements to Japan in 2010 during a spat over the fate of Chinese fishermen who were caught fishing in Japanese waters, Japan, among other nations, began seriously investing in finding alternative materials that could substitute for rare earth metals.

TA B L E 11 . 1 China's Two-Tiered Pricing of Rare Earth Elements

Material International Prices (USD/kg) Chinese Domestic Prices (USD/kg)

Lanthanum  66.46  18.28

Cerium  59.31  20.65

Neodymium  244.23  122.76

Praseodymium  209.62  106.94

Samarium  95.31  14.48

Dysprosium 2032.31 1085.35

Europium 3800.00 2228.38

Terbium 2973.85 1767.93

Source: Richard Silberglitt et al., “Critical Materials: Present Danger to U.S. Manufacturing,” RAND National Defense Research Institute, www.rand.org/content/dam/rand/pubs/research_reports/RR100/RR133/RAND_RR133.pdf.

Manufacturing Equipment In the past decade, the advances of new manufacturing equipment and techniques have changed many global industries. For instance, horizontal drilling allows vertical wells to twist and turn horizontally for over a mile underground. Coupled with hydraulic fracturing (in which a high-pressure solution is pumped into a well to crack the rock and release nearby pockets of hydrocarbons), this technique has increased production of natural gas from shale gas to more than eight times the rate of any earlier technologies. This capability reduces the bargaining power of OPEC producers, significantly altering the global oil and gas industry. This is just one example of how new technologies can overturn commonly held beliefs in any sector, even manufacturing.

Another manufacturing innovation with a dramatic impact on global business is the creation of global manufacturing clusters, suppliers and producers of a given industry in the same geographic location. This proximity facilitates the free flow of ideas, people, and resources between firms and for well-designed hubs often results in global dominance. For instance, in Silicon Valley, tech firms cluster together, attracting talent, investors, and ideas from around the world. Similarly, Italy is the world's center for leather craft and high-end automobiles. center of the fashion industry. South Africa is the center of the world's mining industries. China is the center of the world's garment industry. rules exist that require new businesses to locate near the existing ones in their industry, but new entrants are still likely to benefit from proximity to them.

Transportation Networks Transportation technologies play a vital role in the success of international businesses. Transportation, whether between production facilities or from supplier to customer, relies on a network that links shipping, air, rail, and road; in the not-too-distant future it may even include delivery drones.

Perhaps the most important technological advancement in the transportation industry in the past twenty years has been the invention of the

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Sea Ports and Canals.

Ships

Air Transport

Perhaps the most important technological advancement in the transportation industry in the past twenty years has been the invention of the standardized shipping container. With ports, shippers, and transportation companies all agreeing to standard twenty-foot and forty-foot designs, ships, trains, and trucks can be loaded and unloaded quickly using standardized equipment.

Maersk Line is the world's largest transporter of shipping containers today. It ships goods to and from 115 countries using 600 container vessels. That may not seem like much, but container ships are huge. In 2014, the company introduced the Triple-E (Figure 11.2), the world's largest container ship, which carries 18,000 shipping containers. To put that in perspective, if those containers were lined up end to end, they would stretch for sixty miles. Standardization of shipping containers has enabled this kind of specialized ship, which in turn has increased efficiency and reduced costs in the shipping industry.

FIGURE 11.2 Maersk's Triple-E The world's largest container ship boasts improved fuel efficiency, reduced emissions, and enormous size. Source: Vitron Trading Ltd. 2017. www.vesseltracking.net/wp-content/uploads/2015/12/final_maersk.jpg

Like ships, ports have grown dramatically to keep pace with the demands of global shipping. Shanghai, China, is the world's busiest port, handling the equivalent of more than 15 million forty-foot containers per year. China exports so many goods that it is responsible for six of the ten busiest ports in the world. What does this mean for international businesses? China's investment in transportation makes it relatively easy for global firms to manufacture in China and ship to other markets and for Chinese businesses to export their products abroad.

Major technological changes have increased the safety and efficiency of air transportation and air travel; these changes have led to reductions in their cost. The World Bank estimates that the number of air passengers worldwide has increased from around 300,000 per year in 1970 to over 3.4 billion per year in 2015, equating to more than 6 billion passenger-kilometers, or the number of kilometers flown multiplied by the number of passengers on the planes. The relative ease of travel has increased foreign business travel and foreign vacations, but perhaps more important, it has also increased the ease of shipping goods as air cargo (see Figure 11.3). With the rise of several global e-commerce sites like Alibaba.com and Amazon.com, international air cargo is set to grow quickly because nearly a third of all e-commerce is from foreign customers who buy goods abroad and have them shipped to their home market.

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Sea Ports and Canals.

Ships

Air Transport

Perhaps the most important technological advancement in the transportation industry in the past twenty years has been the invention of the standardized shipping container. With ports, shippers, and transportation companies all agreeing to standard twenty-foot and forty-foot designs, ships, trains, and trucks can be loaded and unloaded quickly using standardized equipment.

Maersk Line is the world's largest transporter of shipping containers today. It ships goods to and from 115 countries using 600 container vessels. That may not seem like much, but container ships are huge. In 2014, the company introduced the Triple-E (Figure 11.2), the world's largest container ship, which carries 18,000 shipping containers. To put that in perspective, if those containers were lined up end to end, they would stretch for sixty miles. Standardization of shipping containers has enabled this kind of specialized ship, which in turn has increased efficiency and reduced costs in the shipping industry.

FIGURE 11.2 Maersk's Triple-E The world's largest container ship boasts improved fuel efficiency, reduced emissions, and enormous size. Source: Vitron Trading Ltd. 2017. www.vesseltracking.net/wp-content/uploads/2015/12/final_maersk.jpg

Like ships, ports have grown dramatically to keep pace with the demands of global shipping. Shanghai, China, is the world's busiest port, handling the equivalent of more than 15 million forty-foot containers per year. China exports so many goods that it is responsible for six of the ten busiest ports in the world. What does this mean for international businesses? China's investment in transportation makes it relatively easy for global firms to manufacture in China and ship to other markets and for Chinese businesses to export their products abroad.

Major technological changes have increased the safety and efficiency of air transportation and air travel; these changes have led to reductions in their cost. The World Bank estimates that the number of air passengers worldwide has increased from around 300,000 per year in 1970 to over 3.4 billion per year in 2015, equating to more than 6 billion passenger-kilometers, or the number of kilometers flown multiplied by the number of passengers on the planes. The relative ease of travel has increased foreign business travel and foreign vacations, but perhaps more important, it has also increased the ease of shipping goods as air cargo (see Figure 11.3). With the rise of several global e-commerce sites like Alibaba.com and Amazon.com, international air cargo is set to grow quickly because nearly a third of all e-commerce is from foreign customers who buy goods abroad and have them shipped to their home market.

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Rail and Roads

FIGURE 11.3 The rapid growth of air travel and air cargo from 1975 to 2014 Source: Franziska Kupfer et al., “The Underlying Drivers and Future Development of Air Cargo,” Journal of Air Transport Management 61 (June 2017): 6–14, www.sciencedirect.com/science/article/pii/S0969699715301678.

Shipping by sea is cheap but slow and limited to coastal ports. Air freight is fast but expensive and limited to regions with established airports. Ground transportation bridges the gap between the two: trucks and trains take the containers shipped over the oceans and move them inland, where much of the world's population lives. In addition, many overland routes exist between countries like Mexico and the United States or Germany and Turkey, and these are best traveled by truck and/or train.

Overall, the combination of improvements in shipping, ports, air, rail, and roads has made much of the world more easily and quickly accessible. As Figure 11.4 shows, a few areas are still remote—like the Arctic tundra, the Amazon basin, the Sahara, the Tibetan plateau, Antarctica, and Siberia— but thanks to advanced physical infrastructure, it is fairly easy to ship goods to most of the rest of the world.

Rail and Roads

FIGURE 11.3 The rapid growth of air travel and air cargo from 1975 to 2014 Source: Franziska Kupfer et al., “The Underlying Drivers and Future Development of Air Cargo,” Journal of Air Transport Management 61 (June 2017): 6–14, www.sciencedirect.com/science/article/pii/S0969699715301678.

Shipping by sea is cheap but slow and limited to coastal ports. Air freight is fast but expensive and limited to regions with established airports. Ground transportation bridges the gap between the two: trucks and trains take the containers shipped over the oceans and move them inland, where much of the world's population lives. In addition, many overland routes exist between countries like Mexico and the United States or Germany and Turkey, and these are best traveled by truck and/or train.

Overall, the combination of improvements in shipping, ports, air, rail, and roads has made much of the world more easily and quickly accessible. As Figure 11.4 shows, a few areas are still remote—like the Arctic tundra, the Amazon basin, the Sahara, the Tibetan plateau, Antarctica, and Siberia— but thanks to advanced physical infrastructure, it is fairly easy to ship goods to most of the rest of the world.

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Production of Power

Power Distribution and Storage

FIGURE 11.4 Accessibility of the world's major cities Source: European Commission, Joint Research Centre. http://forobs.jrc.ec.europa.eu/products/gam/download/accessibility.png.

Energy Resources During a recent visit to an electronics manufacturer in Delhi, India, a U.S. consultant observed the power go out. The lights flickered for a moment, then an alternative power generator kicked in, and the lights hummed back on. Such events are common, and no one else even seemed to notice. Unfortunately, the next building over had no backup power, and it remained dark until the power was restored. Power outages are common in India and other developing markets. In India, businesses lose more than a third of their data because of power outages, and as a result most companies in emerging markets like India must maintain contingency plans for power failures, including backup generators and backup data recovery operations.

Beijing and other areas of northern China are often blanketed in thick smog from both cars and factories as well as from coal-fired power plants. China's energy needs have increased from just 7 percent of the world's power consumption in 1973 to 22 percent in 2013. The country produces over 45 percent of the world's coal supply and imports even more, using this fossil fuel to produce 75 percent of its power. Beijing citizens are angry about the smog that frequently blankets the city (see Figure 11.5), and the government has tried to lessen the haze by reducing traffic and even shutting down businesses when pollution levels are high. Estimates indicate that more than 100,000 people died in China in 2013 as a result of smog, making it the fifth-leading cause of premature death in the country.

FIGURE 11.5 Smog in Beijing The view from the same location in Beijing in photos taken less than three months apart: the one on the left was taken September 27, 2015, and the one on the right was taken December 1, 2015.

As a result of China's smog problem, global energy companies have seen a dramatic increase in the country's level of interest in clean energy solutions. Today, power production in China needs to be clean in addition to being reliable. GE Energy expects that China will double its use of renewable energy sources by 2021—which could be a big win for GE's world-class wind and hydroelectric power products. The shift could also help other global energy providers.

High energy costs have substantial effects on international businesses. Energy-intensive industries—such as aluminum smelting, manufacturing, and even bitcoin mining—gain an advantage by locating in countries with cheaper energy costs. Germany has average electricity costs of $0.19 per kilowatt hour, much higher than the $0.10 in the United States or the $0.07 price in Sweden. In fact, a recent reduction of industrial electricity costs in the United States has led some U.S. companies to bring their manufacturing operations back home. GE recently moved its manufacturing facilities for household appliances such as washing machines, fridges, and heaters from China to Kentucky, partly because energy costs in the state are so low.

The production of power is a global business. Emerging markets like Vietnam are seeking foreign investment in power production. For instance, the Japanese firm Orix recently joined Singapore's United Overseas Bank to buy a 10 percent stake in Vietnam's Bitexco power company. Vietnam plans to invest nearly $150 billion in energy projects in the next 16 years. But even developed countries often rely on foreign investment to build power infrastructure. The United Kingdom just agreed to have a consortium of French and Chinese investment companies build a $24 billion nuclear power plant at Hinkley Point in southern England.

Electricity distribution and storage also have important implications for global companies. Many companies are looking for ways to store electricity production during off-peak times in order to provide it to customers during periods of peak demand. For instance, the city of Los Angeles, California, is planning a huge battery farm to soak up solar power produced during the daily hours of peak sunshine that is not needed until people return home in the evenings. The system involves planned use of 18,000 lithium-ion batteries, each strong enough to power

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Production of Power

Power Distribution and Storage

FIGURE 11.4 Accessibility of the world's major cities Source: European Commission, Joint Research Centre. http://forobs.jrc.ec.europa.eu/products/gam/download/accessibility.png.

Energy Resources During a recent visit to an electronics manufacturer in Delhi, India, a U.S. consultant observed the power go out. The lights flickered for a moment, then an alternative power generator kicked in, and the lights hummed back on. Such events are common, and no one else even seemed to notice. Unfortunately, the next building over had no backup power, and it remained dark until the power was restored. Power outages are common in India and other developing markets. In India, businesses lose more than a third of their data because of power outages, and as a result most companies in emerging markets like India must maintain contingency plans for power failures, including backup generators and backup data recovery operations.

Beijing and other areas of northern China are often blanketed in thick smog from both cars and factories as well as from coal-fired power plants. China's energy needs have increased from just 7 percent of the world's power consumption in 1973 to 22 percent in 2013. The country produces over 45 percent of the world's coal supply and imports even more, using this fossil fuel to produce 75 percent of its power. Beijing citizens are angry about the smog that frequently blankets the city (see Figure 11.5), and the government has tried to lessen the haze by reducing traffic and even shutting down businesses when pollution levels are high. Estimates indicate that more than 100,000 people died in China in 2013 as a result of smog, making it the fifth-leading cause of premature death in the country.

FIGURE 11.5 Smog in Beijing The view from the same location in Beijing in photos taken less than three months apart: the one on the left was taken September 27, 2015, and the one on the right was taken December 1, 2015.

As a result of China's smog problem, global energy companies have seen a dramatic increase in the country's level of interest in clean energy solutions. Today, power production in China needs to be clean in addition to being reliable. GE Energy expects that China will double its use of renewable energy sources by 2021—which could be a big win for GE's world-class wind and hydroelectric power products. The shift could also help other global energy providers.

High energy costs have substantial effects on international businesses. Energy-intensive industries—such as aluminum smelting, manufacturing, and even bitcoin mining—gain an advantage by locating in countries with cheaper energy costs. Germany has average electricity costs of $0.19 per kilowatt hour, much higher than the $0.10 in the United States or the $0.07 price in Sweden. In fact, a recent reduction of industrial electricity costs in the United States has led some U.S. companies to bring their manufacturing operations back home. GE recently moved its manufacturing facilities for household appliances such as washing machines, fridges, and heaters from China to Kentucky, partly because energy costs in the state are so low.

The production of power is a global business. Emerging markets like Vietnam are seeking foreign investment in power production. For instance, the Japanese firm Orix recently joined Singapore's United Overseas Bank to buy a 10 percent stake in Vietnam's Bitexco power company. Vietnam plans to invest nearly $150 billion in energy projects in the next 16 years. But even developed countries often rely on foreign investment to build power infrastructure. The United Kingdom just agreed to have a consortium of French and Chinese investment companies build a $24 billion nuclear power plant at Hinkley Point in southern England.

Electricity distribution and storage also have important implications for global companies. Many companies are looking for ways to store electricity production during off-peak times in order to provide it to customers during periods of peak demand. For instance, the city of Los Angeles, California, is planning a huge battery farm to soak up solar power produced during the daily hours of peak sunshine that is not needed until people return home in the evenings. The system involves planned use of 18,000 lithium-ion batteries, each strong enough to power

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not needed until people return home in the evenings. The system involves planned use of 18,000 lithium-ion batteries, each strong enough to power a car, to provide power during periods of peak demand, enabling conventional generation methods to function at their most efficient levels rather than try to scale up or down with the fluctuation in demand.

Some companies, such as AES Corporation and Tesla, are working on solutions that enable power to be produced, stored, and used on site ( 11.6). The idea is for a home to produce enough power to meet the needs of the occupants, storing it during peak production and making it available during peak usage times. Power produced on site would have the added benefit of reducing the need for the massive energy infrastructure that currently transports power over the 300,000 miles of high-voltage and transmission lines within the United States. For example, nearly $283 billion is spent each year on both new lines and replacements for existing grid systems. Local household production of power could eliminate much of the vast system of electrical transmission lines in the United States.

FIGURE 11.6 Is that battery art? In the future, energy will likely be produced by individual homes, dramatically decreasing the need for grid energy systems.

Copyright © 2018 by John Wiley & Sons, Inc. All rights reserved.

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Concept Check 11.1 !

Question Attempts: 0 of 1 used

Question 1

GERD is ________.

Gross Expenses on Research and Development

Gross Experience in Research and Development

Global Earnings of Research and Development

Global Experience in Research and Development

not needed until people return home in the evenings. The system involves planned use of 18,000 lithium-ion batteries, each strong enough to power a car, to provide power during periods of peak demand, enabling conventional generation methods to function at their most efficient levels rather than try to scale up or down with the fluctuation in demand.

Some companies, such as AES Corporation and Tesla, are working on solutions that enable power to be produced, stored, and used on site ( 11.6). The idea is for a home to produce enough power to meet the needs of the occupants, storing it during peak production and making it available during peak usage times. Power produced on site would have the added benefit of reducing the need for the massive energy infrastructure that currently transports power over the 300,000 miles of high-voltage and transmission lines within the United States. For example, nearly $283 billion is spent each year on both new lines and replacements for existing grid systems. Local household production of power could eliminate much of the vast system of electrical transmission lines in the United States.

FIGURE 11.6 Is that battery art? In the future, energy will likely be produced by individual homes, dramatically decreasing the need for grid energy systems.

Copyright © 2018 by John Wiley & Sons, Inc. All rights reserved.

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Concept Check 11.1 !

Question Attempts: 0 of 1 used

Question 1

GERD is ________.

Gross Expenses on Research and Development

Gross Experience in Research and Development

Global Earnings of Research and Development

Global Experience in Research and Development

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