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Pictures of the Future
The Magazine for Research and Innovation | Spring 2012
The Next Economy
Mastering
Complexity
Formulas for Efficiency
The changing structure of the global value chain
Smart tools for planning infrastructures and cities
Technologies that cut demand for energy and resources
Solutions for Tomorrow’s World
Pictures of the Future | Spring 2012 32 Pictures of the Future | Spring 2012
Formulas for Efficiency
Mastering Complexity
The Next Economy
Features
118 Scenario 2035
Suit Yourself
110 Trends
The New Global Economy
112 Facts and Forecasts
Greater Prosperity but More Inequality 115 Interview with Prof Dani Rodrik
The Changing Face of Globalization
116 Investing in Latin America
Full Steam Ahead
119 Photovoltaics in Mexico’s Mountains
New Lives with Light
120 Water Purification in Turkey
Waste Not, Want Not
122 Global Logistics Chains
Information Lifelines
126 Facility Planning in India
Sweet Spot Science
128 Healthcare
No One Left Behind
130 Exporting Know-how to Uganda
Sweet Partnership
131 Russia
Modernizing a Major Economy
133 Job Satisfaction A New Spin on Work
136 Financing
Profitable Projects1
140 Scenario 2040
What If…?
143 Trends
Solving the Simplicity Puzzle
145 Facts and Forecasts
Learning from Nature
146 Smart Grids
A Village that Harvests Energy 149 Interview with Stephan Kohler, Managing Director of dena
Germany’s Transition to Renewables
150 Citizen Participation
Let’s Make a Deal!
152 Interview with Prof. Ortwin Renn
Why Citizen Participation is Growing
154 R&D’s Value Add
How Research Strengthens Siemens
158 User-Friendliness
Keep it Simple!
160 Urban Planning
City in a Digital Nutshell
162 System Safety
Staying a Step Ahead of Hackers
164 Water Conservation
Simulations that Localize Leaks
166 Traffic Systems
How IT Can Boost Capacity
169 Traffic Management in China
Moving Experience
170 Hajj to Mecca
Deadline in the Desert
172 Algiers Metro
Subway to a Better City
178 Scenario 2035
Let the Games Begin!
180 Trends
Efficiency is the Key
184 Load Management
Buildings that Change their Behavior 186 Networked Buildings
Starving the Energy Monster
188 Interview with Prof. Ernest J. Moniz
An advisor to President Obama explains ho
w the U.S. is becoming more energy efficient e
ven without an energy policy. 190 Energy Efficiency in China
Sustainability Boom 194 Facts and Forecasts
Growing Market for Energy Efficiency T
echnologies
196 Wind Power
Lower Prices in t
he Air
199 Neural Network Forecasting
Formula for Grid Stabilization in Europe
100 Electrolysis
Hydrogen: The Most Versatile Fuel
103 Algae and CO
2
Utilization
Green Solution
104 Waste Heat Utilization
Hot Opportunities
107 New Materials
The Elements of Competitiveness
109 Software
How IT Invigorates Healthcare Systems
111 Production Processes
Building a Common Framework
184
Short Takes News from Siemens’ Labs
186 Sur
vey
Why Readers Like Pictures of the Future
187 African Green City Index
Mixed Results
138 Earth Summit Rio+20 It’s Time to Act — Now!
174 Electric Vehicles
Power where it’s Needed
114 Feedback 115 Preview
Pictures of the Future | Contents
Pictures of the Future | Editorial
A
ccording to the Greek philosopher Heracli-
tus, who lived 2,500 years ago, the only
constant in the universe is change. Today this
insight is more valid than ever before. Raw ma-
terials are growing scarce, and the earth’s cli-
mate is at risk. Our energy supply must be put
on a more sustainable foundation, and we
must use our resources more efficiently. The
global economy is also changing. In 2000, only
a fourth of world trade took place between de-
veloping countries and emerging economies;
today that figure has risen to 40 percent. At
Klaus Helmrich is the Head of Corporate Technology, Chief Technology Officer, and a
member of the Managing Board of Siemens AG.
energy and resources (pp. 78–113). This ap-
plies to companies and countries as well as to
energy systems. Today, more than half of the
primary energy we use is lost. This is ineffi-
cient, since waste heat can be used to gener-
ate power or purify water (p. 104). The prob-
lem of excess power from wind turbines,
which often cannot be fed into the grid, can
also be solved — our engineers are working on
plants that transform it into hydrogen (p. 100).
And energy use in buildings can be minimized
using computers, communications, and build-
ing automation technology. In fact, even pow-
er grids can be stabilized by means of targeted
management of electricity use in networks of
buildings, such as chain stores. This helps ener-
gy suppliers, saves money for building users,
and helps to protect the environment (p. 86).
Is it possible to digitally manage not only
buildings but also entire cities? How can we
find tiny leaks in drinking water networks that
are thousands of kilometers long? And what
will be the main features of tomorrow’s smart
power grids? Finding ways of mastering such
complex systems is another theme of this issue
(pp. 40–73). In many cases, the answer can be
found in sophisticated software concepts —
platforms for virtual urban planning (p. 60),
software agents for balancing supply and de-
mand in power grids (p. 46), and a combina-
tion of sensors and smart evaluation algo-
rithms that search for leaks in drinking water
networks (p. 64). Experts at Siemens Corporate Technology
locations worldwide are playing a key role in
the search for all these new solutions. Whether
the issue is research, development, production
or new product testing, experts from Corpo-
rate Technology are contributing to every link
of the value chain. In line with the company’s
technology areas, they are safeguarding
Siemens’ technological foundation through de-
velopment and software services, while “light-
house projects” guarantee an innovative fu-
ture. In addition, a Siemens team supports
startups and conducts precisely targeted
searches for new ideas outside the current
business portfolio. A strategic patent portfolio
protects the company’s intellectual property. Thanks to these measures, Corporate Tech-
nology ensures that Siemens maintains its
competitive technological edge. To give just
one example, the company attained first place
at the European Patent Office by a wide mar-
gin in terms of the number of patent applica-
tions it submitted in 2011. And the creativity
of Siemens employees has never been better.
Today, each of our nearly 28,000 R&D employ-
ees submits twice as many inventions as just
ten years ago. The world may be changing, but
Siemens’ intense focus on innovation will re-
main undiminished.
Cover:Half of the primary energy used
in industrial processes and energy
generation is wasted. But a highly
efficient prototype process being developed at Siemens is making it
possible to purify water using low
level waste heat. For more, see p. 104.
the same time, China’s innovative power has
increased enormously. For example, the num-
ber of Chinese patents being registered at the
European Patent Office today is 100 times
greater than it was in 2000. What’s more, the
booming economies of Brazil, Russia, India,
and China are being joined on the global eco-
nomic stage by vigorous new players such as
Mexico, Turkey, and Colombia. Meanwhile, the challenges we face are be-
coming more complex — whether the issue is
urban infrastructures or the transition to a sus-
tainable energy economy, through which Ger-
many intends to cut its greenhouse gas emis-
sions by 80 percent by 2050. Without highly
integrated smart structures — in power net-
works, transportation systems, and buildings
— potential solutions will not work. Here too,
change is occurring in many areas. For exam-
ple, the volume of data being stored world-
wide doubles every two years, and soon the
number of devices sharing information will be
greater than the world’s population.
The ways in which companies deal with this
steady process of change will determine their
competitiveness. In order to maintain its lead-
ing position as a technology provider and open
up new markets, Siemens is addressing these
changing challenges with great openness and
flexibility. Siemens’ international research and
development network is playing a key role in
this regard. Cooperative projects with top uni-
versities are a decisive factor here, as are the
skills of Siemens’ experts and its close connec-
tions with its customers around the globe. In
this issue of Pictures of the Future, the section
entitled “The Next Economy” reveals how
Siemens is developing and implementing inno-
vative solutions in India, Russia, Turkey, and
Latin America; planning factories all over the
world; and keeping logistics chains intact, even
in very difficult situations (pp. 8–37). One of the most important levers for cop-
ing with many challenges is the efficient use of
A World of Opportunities
Semprius’ newest modules (illustration) have achieved a record 34 percent efficiency. P
hotovoltaic manufacturer Semprius, which is based in Durham, North Carolina,
has achieved a record efficiency of 33.9 percent with its high concentration pho-
tovoltaic (HCPV) modules. This record was measured under standardized test condi-
tions in a joint project with the Instituto de Sistemas Fotovoltaicos de Concentración
and the University of Madrid. Classic photovoltaic modules made of monocrystalline
or polycrystalline silicon currently achieve an efficiency of around 20 percent and 16
percent, respectively. The highly concentrated photovoltaic modules from Semprius
have a glass covering with integrated lenses. The lenses focus rays of sunlight, making
it possible for them to operate with much less semiconductor material in each photo-
voltaic panel than conventional technologies. The panels are made of an inexpensive
substrate on which small solar cells about the size of a pencil point — around 0.5 mm
2
— are positioned. Lenses concentrate incident sunlight by a factor of about 1,000,
and the resulting heat is conducted away through the substrate. In order to work
properly, however, such modules must be used in conjunction with trackers that fol-
low the sun throughout the day. This type of solar cell is ideal for use with direct sun-
light, for example in desert environments. Instead of transferring the cells chip by
chip, Semprius uses its patented micro-
transfer printing process, which inexpen-
sively applies up to one thousand cells per
step. The cells are made of multiple layers
of light-absorbing III-V semiconductors
such as gallium arsenide that actually
achieve an efficiency of 41 percent in the
laboratory. Siemens has a stake in Sem-
prius and wants to develop the technolo-
gy further. High-volume commercial pro-
duction of the modules is scheduled to
begin in mid-2012. Focused on Efficiency
Pictures of the Future | Short Takes
Pictures of the Future | Spring 2012 5
A
flexible organic light-emitting diode (OLED) from Osram has set a new effi-
ciency record. Like LEDs, OLEDs are materials that convert electricity into light.
But whereas LEDs emit light from a point, the luminous plastics in OLED panels
emit light over an area. OLED products in the form of light tiles have been around
for two years. Flexible versions are still being developed. Now, Osram researchers
have produced a flexible OLED that emits white light from a surface measuring 11
by three centimeters. The unit generates 32 lumens per watt of electricity, making
it more efficient than a halogen lamp. This record-breaking efficiency value was
measured under nearly real-
istic conditions and without
any lenses or other devices
to increase light yield. One of
the technical challenges as-
sociated with the design of
flexible OLEDs involves pro-
tecting the sensitive lumi-
nescent layer — which is just
half a micrometer thick —
against oxygen and humidi-
ty. This has been achieved
using a special thin film
process and a flexible steel
foil that is as thin as a sheet
of paper and replaces the
glass sheet at the back of the
unit.
Dawn of the Diodes
A
t its plant in Aurangabad, India, Siemens has
developed the world’s first circuit breaker ca-
pable of operating at 1.2 million volts. Ultra-high
voltages increase the transmission capacity of
power cables, thereby making it possible to trans-
port large amounts of electricity over long dis-
tances with a relatively small number of overhead
lines. Circuit breakers are used in transformer sub-
stations to connect or disconnect individual trans-
mission lines. The new circuit breaker is destined
for a test installation in Bina, India. The Indian
government is turning to ultra-high voltage (UHV)
technology in order to supply metropolitan areas
with electricity that has been generated at distant
locations in the country’s mountainous regions.
The 1.2 megavolt test transmission line is capable
of transmitting 8,000 megawatts of power. It
therefore has more than twice the capacity of the
800-kilovolt lines that are currently in use. Alter-
nating voltages of over one million volts and di-
rect voltages of over 800 kilovolts are both classi-
fied as ultra-high voltages. Transmission at such
high voltages reduces power losses and is there-
fore more efficient. P
aris’ metropolitan transport authority (RATP) is switching its Metro’s Line 1 to
fully automatic operation — which means its going driverless. Siemens is re-
sponsible for the modernization of the automation technology. The new system
is more energy-efficient than those with drivers and makes it possible to shorten
the intervals between trains from 105 to 85 seconds. Line 1 is the most heavily
traveled Metro line in Paris, transporting approximately 725,000 passengers per
day to attractions such as the Louvre and the Arc de Triomphe. Installation of the
line’s control technology and telecommunication system, adaptation of the rail
vehicles, and equipment
for the new control center
are all taking place in paral-
lel without disrupting nor-
mal operations. At present,
the old trains are being re-
placed, one by one. In
March 2012 there were 14
driverless trains in service
on Line 1. By early 2013 all
49 of the line’s new Metro
trains are to be equipped
with automation technolo-
gy, bringing service up to
full transport capacity. It
will then be possible to ad-
just the train frequency
flexibly as needed.
India’s Super Circuit Breaker
M
any products such as electric motors and high
performance magnets rely on rare earth met-
als, 97 percent of which currently come from China.
Siemens and RWTH Aachen University in Germany
have launched a joint research project aimed at de-
veloping methods and processes for extracting such
materials efficiently with low environmental impact.
Siemens is providing €6 million in funding for the
strategic collaboration — which is the company’s
first university-based research program in this area.
Plans call for at least nine doctoral candidates to
conduct their research in this field over the next four
years. Taking part in the collaboration are four de-
partments from RWTH Aachen University, the Jülich
research center in western Germany, and experts
from Siemens’ Industry Sector. Siemens wants to re-
duce dependence on scarce or expensive raw mate-
rials such as rare earth metals, and is using different
approaches in parallel to achieve this goal. For ex-
ample, scientists at Siemens Corporate Technology
are also working on strategies for more efficient
use, recycling, and substitution of such materials.
They are analyzing existing supply-related risks and
developing new materials and recycling processes. Recovering
Rare Materials Going Driverless in Paris
4 Pictures of the Future | Spring 2012
New OLED produces a record 32 lumens per watt.
Passengers get a front-row view on Paris’s automated Line 1. The new switch operates at 1.2 million volts.
New magnetic materials may reduce the need for rare earths. Glass cover with lenses
Spherical glass lenses
Solar cells
Substrate
Pictures of the Future | Spring 2012 7
Cities are growing faster in Africa than anywhere else. In fact, the continent’s urban population has doubled in the last 20 years. The African Green City Index compares how major cities are managing.
Four out of every ten people in Africa live in cities, where environmental protection usually isn’t a major concern. Mixed Results
Pictures of the Future | African Green City Index
a wind farm that entered service in 2008 feeds
clean energy into the country’s national grid.
Still, coal remains South Africa’s primary ener-
gy source for generating electricity. The index also showed that the strengths
and weaknesses of South African cities are
similar to what’s found in the West. Waste disposal and clean drinking water aren’t major
issues, but per capita electricity use, water
consumption, and waste production are sky-
rocketing. The main objectives for the future
are therefore to use available resources more
efficiently, develop alternatives to fossil fuels,
and step up recycling efforts. Several cities in northern Africa also per-
formed well in the index — Alexandria,
Casablanca, Cairo, and Tunis, for example. UN
Habitat reports that these cities have succeed-
ed in supplying almost all of their households
with clean drinking water and electricity and
have relatively good transport infrastructures,
although Cairo is the only one of the 15 cities
studied that has a subway. On the other hand, sub-Saharan cities (Ac-
cra, Addis Abeba, Dar es Salaam, Lagos, Luan-
da, Maputo, and Nairobi) face huge problems.
These cities’ efforts to quickly meet their popu-
lations’ basic needs conflict with long-term
goals that could include improved environ-
mental protection. Lagos, for its part, has shown what can be
accomplished even when municipal budgets
are tight. Until recently, the city’s outskirts
were dotted with huge piles of garbage. A
newly established agency for waste manage-
ment then took matters into its own hands,
and as a result around 10 percent of the waste
in Lagos is now recycled. About 30 tons of
plastic waste is used to make shopping bags
and similar products every day, for example,
and plans call for the volume of recycled waste
to be almost tripled by 2015.Nicole Elflein
F
our out of every ten people in Africa live in
cities, and this figure is expected to hit 50
percent by 2035. One of the world’s fastest-
growing cities — it may well double its current
population of three million by 2020 — is Dar
es Salaam in Tanzania. Such growth would put
a tremendous burden even on cities in indus-
trialized countries; but in Africa, which tends
to lack financial resources and expertise, it can
be a special challenge to provide all urban resi-
dents with electricity, water, and housing. So
it’s not surprising that two thirds of the people
in cities like Dar es Salaam, Maputo, Lagos, and
Luanda live in shantytowns, where environ-
mental protection isn’t the top priority.
Nicholas You, an expert on sustainable urban
development based in Nairobi, says this has to
change. “Green guidelines aren’t something
that would be nice to have in Africa; without
them, there will be no sustainable develop-
ment on the continent,” he says.
The African Green City Index outlines the
specific sustainability challenges Africa faces,
as well as the continent’s strengths. The final
report was presented at the 2011 Climate
Summit in Durban. Siemens commissioned the
Economist Intelligence Unit to examine 15
cities in Africa for the study. The South African
cities of Durban, Johannesburg, Cape Town,
and Pretoria did well in the index, largely be-
cause of their extensive environmental protec-
tion efforts. Cape Town, for example, has in-
troduced a program for energy efficiency and
climate protection and has launched 130 indi-
vidual projects designed to achieve reductions
in electricity use, among other things. Plans
call for 300,000 solar-powered boilers to be in-
stalled in the city over the next few years; and
What Resource Use Says about Africa’s Economy
Electricity:Electricity generation is closely linked to economic development. Cities in northern Africa
and South Africa account for the highest levels of generation and use on the continent. The median per
capita consumption in these cities is 2,750 kilowatt-hours (kWh) per year. Sub-Saharan cities, which
generally have fewer people connected to the grid, consume only 640 kWh per capita per year. Water:Per capita water use in the cities studied was 187 liters per day. The figure for Latin America is
264 liters, and for Asia it is 278 liters. The reason for the low figure in Africa is that many people have no
direct access to drinking and tap water. Water prices are also high. Population density:Urban sprawl is a major problem in Africa. Cairo is the continent’s most densely
populated city, with an average of 19,100 people per square kilometer (km
2
). Excluding Cairo, the aver-
age population density of the cities in the index ranges from 4,600 to 3,500 people per km
2
. By compar-
ison, Munich has a population density of 4,400 per km
2
; the average figure for Asia is 8,200.
6 Pictures of the Future | Spring 2012
PoF’s survey results find that 83% read the mag-
azine for over 30 minutes, 47% for over an hour.
Why Readers Like PoF Pictures of the Future | Reader Survey 2011
vamped, and it is available free of charge in
the App Store. Pictures of the Future is distrib-
uted to readers in more than 100 countries.
Around one third of copies are sent to readers
in Germany, another third to other European
countries, 15 percent to North and South
America, 15 percent to Asia, and five percent
to Africa.
The magazine posted a major success in
spring 2012, when the Society for Technical
Communication, the largest organization of its
kind worldwide, granted Pictures of the Future
its two highest awards: “Distinguished Techni-
cal Communication” and “Best of Show.”
The key results of our reader survey, which
was conducted in late 2011, are summarized
below. Over 550 questionnaires were filled out
and returned. Almost 60 percent of responses
were from readers who do not work for
Siemens. In addition, over one fourth of
respondents stated that they were senior
executives or managers.Ulrich Eberl
S
ince 2001, Siemens has published Pictures
of the Future twice each year. As a result of
the great interest expressed by the magazine’s
readers, its circulation has quadrupled to ap-
proximately 100,000 copies: 37,000 in Eng-
lish, 28,000 in German, and around 35,000
in French, Chinese, Russian, Spanish, Brazilian
Portuguese, Romanian, and Turkish. Since last year, the magazine has also taken
a new approach on the Web; its online multi-
media presentation has been completely re-
What Is Your Profession?
Self-employed
Senior executive
Manager
Employee Research management
Involved in public research
Journalist
Government employee / civil servant
Student
Other
Percentage of replies
30 or below
30–39
40–49
50–59
Over 60
Australia-Pacific Africa Asia America
0 10 20 30 40
0 20 40 60 80
How Long Do You Spend Reading PoF?
Less than 15 minutes
15–30 minutes
30–60 minutes
More than 60 minutes
Percentage of replies
General Assessment of the Magazine
PoF provides me with valuable information and inspiration for my work
Pictures of the Future addresses trends in a timely manner
PoF provides interesting insights into R&D activities at Siemens
Pictures of the Future reports on impor-
tant future developments in a serious way
PoF made me aware of the entire range
of activities at Siemens
Percentage of replies (cumulative)
0 10 20 30 40
0 25 50 75 100
Design of Pictures of the Future
The style of writing in Pictures of the
Future is easy to understand
The layout is reader-friendly
The magazine has a logical structure
The pictures and illustrations are
appealing
The charts and tables are informative
The Facts+Forecasts boxes with economic
trend analyses are informative
The In Brief boxes with executive
summary, people, links etc. are useful
Pictures of the Future is fun to read
Percentage of replies (cumulative)
Fully agree ■
Strongly agree ■
Agree ■
Disagree ■
Strongly disagree ■
Fully agree ■
Strongly agree ■
Agree ■
Disagree ■
Strongly disagree ■
0 25 50 75 100
I Particularly Like...
Future scenarios for the main themes
Introductory articles on trends
Detailed reports on Siemens’ developments
Coverage of interesting projects and technologies
Articles about joint research ventures
Interviews with external experts
Analyses in the Facts+Forecasts boxes
Brief reports about the latest research results
Percentage of replies
In the Future I Would Like to See…
More information about R&D results at
Siemens
More reports about the utilization of
innovations by customers
More clear reports on applications
A greater focus on the economic potential of innovations
More reports on cooperation with partners
More personal profiles of top researchers
More information about international
developments
More background analyses of trends
outside Siemens
More reports on innovation
management at Siemens
More information on planning for the
future at Siemens
More contact partners and
online links
Percentage of replies
0 10 20 30 40 50
Age Place of Residence
Germany
Rest of Europe
Pictures of the Future | Spring 2012 98 Pictures of the Future | Spring 2012
2035
B
usiness is booming this afternoon at a
shopping mall in Hamburg, Germany.
Thomas Jones, a professor of medicine from
Nigeria, has completed his meetings with Ger-
man colleagues and is now using the early
evening hours to look for a new suit. For quite
some time now, buying clothes off the rack
has been a thing of the past. Jones, who is
now 40, knows of this custom only by hearsay.
His suit will be not only tailor-made but also
produced in an almost fully automatic process
that includes everything from the purchase of
2035. A young professor of medicine from Nigeria is shopping for a tailor-made suit in Hamburg. In the process, he gets a look at how products are created in an age of comprehensive global networking.
Suit Yourself
The Next Economy | Scenario 2035
raw materials to production and delivery.
What’s more, the entire process is designed to
be environmentally friendly. Jones smiles expectantly as he enters a
branch of an international fashion company
that keeps his measurements — naturally with
his consent — on file. “Good morning,
Thomas,” says a young salesman. The last time
Jones shopped at a branch of this chain was
two years ago in his home town, Lagos! Obvi-
ously a camera must have scanned his face
and software must have recognized him as he
Highlights
10 The New Global Economy
The Industrial Revolution took place a
long time ago, but radical changes in
the structure of the global economy
are still in full swing. Today it’s not
only the emerging markets that are
experiencing an uptick in their domestic economies. New markets are also taking shape in Colombia and Turkey, which Siemens calls Second Wave Emerging Countries. Pages 16, 19, 20, 21
22 Information Lifelines
When natural disasters strike, well-planned crisis management can
breathe new life into a company’s logistics chains. 26 Sweet Spot Science
At Siemens, identifying the ideal locations to place factories is becoming a science. 28 No One Left Behind
Cost-effective solutions are being developed in emerging economies to provide basic medical care for people in cities and rural areas. 30 Southern Partnership
“South-South cooperation“ is opening
up new opportunities. A sugar factory in
Uganda is combining the strengths of
Siemens in India and Kenya.
33 A New Spin on Work
What will the working environment of tomorrow look like? One thing is certain. It will be flexible and offer the right balance with private life. In 2035 hardly any clothing is sold off the
rack. So when Thomas Jones, a professor of
medicine from Nigeria, orders a suit from the
Hamburg branch of a worldwide fashion
chain and asks to have it delivered to him in Lagos, the company uses Web-based software solutions to look for the best combination of growing area, weaving mill, and processing plant in terms of costs and climate-friendliness.
Pictures of the Future | Spring 2012 11
The global economy is changing, but one of its fundamental rules still applies: Innovation
makes prosperity possible and lasting.
The New Global Economy
The Next Economy | Trends
A 384-meter escalator in Medellín, Colombia.
Foreign direct investment in the country
rose by 56 percent in 2011.
D
uring the Industrial Revolution, spinning
frames and steam-powered looms turned
clothing manufacture into a highly mechanized
process. These innovations made northwestern
England the world’s leading center for the pro-
duction of textiles. It also caused the decline of
India’s textile industry, which could not compete
against the mechanical systems’ higher efficien-
cy. Today, 250 years later, the industrial land-
scape in England has completely changed and
many world-famous brand icons from the UK
are owned by foreigners. The most prominent
examples of this are Land Rover and Jaguar,
both of which belong to the Indian company
Tata Motors.
The global economy is changing in a process
that economists describe as creative destruc-
tion. Innovations are making new business
models possible and old ones redundant. Most
of these changes are hardly noticeable on their
own, because they consist of minor improve-
ments to production methods, accelerated or
more cost-effective transportation systems, and
increasingly efficient communication systems.
But when taken together, these steps amount to
major trends. They have an effect on where products are
manufactured as well as how and by whom
they are consumed. They also define where
wealth is created and where it is destroyed. And
finally, they determine where the next big idea
will be generated to propel the global economy
forward in its continuing process of creative de-
struction.
The overall effect of all of these small steps is
so huge that the global economy is continuous-
ly changing its appearance. Who could have
predicted China’s rapid rise 30 years ago? Or the
collapse of the Soviet Union? And who would
have thought that much of the mass production
manufacturing sector would migrate from Eu-
rope and the U.S. to Asia? Or that people today
would be using the Internet to conduct logistics
operations — including the ordering of pizza —
quickly and cost-effectively?
“It has become obvious that the structure of
the global economy is undergoing profound
changes,” says Dr. Tom Kirchmaier from the Fi-
nancial Markets Group at the London School of
Economics (LSE). “In the future, conventional in-
dustrial sectors will primarily grow in today’s
emerging markets. For highly developed coun-
tries this means that they will have to generate
10 Pictures of the Future | Spring 2012
textiles were produced almost exclusively in
low-wage countries,” he says. “Now that everything is tailor-made, we
only need relatively small batches of fabric.
The only requirement is that the transporta-
tion routes have to be as short as possible and
the carbon dioxide balance has to be kept in
mind,” Erikson replies. He tells Jones that the
company almost went bankrupt in the early
2020s. Clothing could no longer be offered at
rock-bottom prices after countries like India
and China started not only producing clothing
but also selling it themselves — and thus keep-
ing a large part of the profits. “My father soon realized that the age of
globally mass-produced products was over and
that only individualized products could gener-
ate a profit,” Erikson recalls. At that time there
was a recession, and lenders weren’t willing to
invest in corporate restructuring. But Erikson’s grandfather was not prepared
to give up. In line with the concept of crowd-
funding, he used social networks to find 1,000
private investors who believed in his vision of a
modern and sustainable fashion firm. Initially
the company only produced clothing on de-
mand, but soon it also incorporated factors
such as pesticide-free cultivation, fair working
conditions, and sustainable production
processes. And because more and more firms
were adopting this approach, the big technolo-
gy companies developed new Web-based soft-
ware programs that gradually created a com-
prehensive network of customers, producers,
and raw materials suppliers. Jones tries on a jacket made of the fabric he
has selected. “It’s very pleasant to wear,” he
says. In a wall “mirror” he sees a picture of him-
self wearing the new suit he has ordered.
“Hmm, the color’s still not ideal. I think I’ll take
a lighter tone,” he says, having changed his
mind. Then he realizes that he’s leaving Ham-
burg tomorrow and that the suit has to be de-
livered to Lagos. “
No problem,” says Erikson, typing this in on
a keyboard. Three minutes later, the ordering
system comes up with a completely new deliv-
ery chain. “Your cotton will now come from
Chad, and the weaving mill is in Benin,” Erik-
son says. The sewing will be done in Nigeria.
The design is available to all of the chain’s con-
tract tailoring shops via our Web-based servic-
es. “The hardest thing was to get all of our sup-
pliers to comply with a uniform quality
standard.” But ever since the governments in
West Africa began focusing on education and
professional qualification programs, this has
been no more problematic than in other coun-
tries. “Nowadays a good suit can be produced
in the same way on every continent. And it no
longer has to have a dark color!” Erikson con-
cludes with a smile. Katrin Nikolaus
stepped into the store just now, uploading his
data onto the salesman’s information device. The two men begin a detailed discussion of
suits. “My father always wore a shirt and a dark
suit when he went to his job at his company,”
Jones recalls. “Mine too,” replies the salesman,
who turns out to be one of the managing di-
rectors of the fashion chain. He introduces
himself as Paul Erikson, the son of the compa-
ny’s founder. At the moment he’s spending a
week working at the Hamburg branch in order
to get a sense of what customers are asking for
these days. The market analyses he receives
are optimally differentiated, but human intu-
ition is still a crucial factor for a fashion compa-
ny’s survival. Jones steps onto a platform and has his
measurements taken with a laser scanner. A
computer compares the current data with the
data registered from earlier visits. “Just a bit
wider around the hips,” says Erikson with a
smile. Then the two men choose a color from a
table of more than a hundred shades and de-
cide on the desired type of cloth. Jones choos-
es a lightweight cotton that will be appropriate
for the Nigerian climate. Six weeks earlier, Buthan Singh stood in his
cotton field in the state of Punjab in India,
checking to see whether his crop was ready for
picking. “We should start the first harvest in
two days,” said his foreman. Singh does not
use fully automated harvesting methods. In-
stead, he picks his cotton according to the indi-
vidual plants’ degree of maturity. That results
in much higher quality and earns him good
prices on the world market. The farm has been
owned by Singh and his ancestors for five gen-
erations, but only in the past 20 years have
Singh and his family been able to make a good
living from cotton cultivation. That’s because
during this period the government’s subsidies
for agricultural produce have been gradually
reduced and almost entirely abolished. Singh sells his harvests via an automatic
raw materials exchange. An English weaving
mill that specializes in high-quality suit fabrics
has bought the first batch. The mill’s cus-
tomers consider not only price and quality im-
portant; they also look to see how sustainably
the cotton was produced. This information
reaches the end customer by means of product
tracking software that works with smart RFID
labels. Customers need this information in or-
der to know how much a purchase adds to
their personal emissions’ account. “The cotton for this suit comes from Pun-
jab,” says Erikson after a quick look at his infor-
mation device. “The fabric was manufactured
— just a moment — ah yes, in England.” Jones smiles before replying. “It’s rather
ironic that there are weaving mills in England
once again, after so many decades in which
Pictures of the Future | Spring 2012 13
Future,Fall 2010, p. 67). The plant specializes
in a number of products, including distribution
transformers for renewable sources of energy,
in particular for large wind farms and solar
plants in the U.S. and Canada. The transform-
ers were developed by Siemens engineers in
Colombia.
Innovation is increasingly taking place in
emerging markets, largely because there is a
growing need to adapt products to local re-
quirements. As awareness grows that each
market has its own needs, a “one-size-fits-all”
approach is becoming a thing of the past. In
the future, large corporations will have to fur-
ther decentralize their structures and process-
es and operate in a “multi-local” fashion so that
they can be at home and innovate in several
places at once. For example, Siemens is cur-
rently investing around €40 million in a re-
search and development center near Moscow.
The facility will become part of the Skolkovo
Innovation Park. The Russian government is set
to invest approximately $2.8 billion in the proj-
ect during its first three years (p. 31). One of Siemens’ long-term aims in invest-
ing in emerging markets is to increase the
number of SMART products in its global port -
folio. In this context, “SMART” stands for “Simple,” “Maintenance-friendly,” “Affordable,”
“Reliable,” and “Timely to market.” In other
words, SMART products are entry-level prod-
ucts that are perfectly tailored to the needs of
specific market segments (see Pictures of the
Future,Fall 2010, p. 56).
Such products include the SOMATOM Spirit
CT scanner. Due to its relatively low price, the
scanner will enable many hospitals to offer
computed tomography examinations for the
first time. In countries such as China, the de-
vice will benefit people with access to smaller
hospitals only, e.g. in rural areas. Until now,
hospitals in such places were rarely equipped
with CT scanners. Economic growth and cost-
saving innovations are thus giving millions of
people access to high-quality medical care for
the first time.
In Chiapas, Mexico’s poorest state, Siemens
has supplied hospitals with 44 ultrasound sys-
years. But India also faces great challenges, especially
when it comes to expanding infrastructure and combat-
ing poverty. Four out of ten people in India live below
the poverty line, while only one out of five Chinese is
still considered poor. This ratio was the very opposite
just 25 years ago. Although progress in these countries
has been impressive, the United Nations’ Human Devel-
opment Index, which primarily measures the quality of
life, has developed less well. China currently ranks 101st
in the Index, while India is 134th, Brazil 84th, Turkey
92nd, and South Africa 124th. What’s more, all of these
countries have dropped in the latest ranking since the
previous year. Will the world be a more just place by 2050 than it is
now? According to the OECD, income inequality has in-
creased in the great majority of its member countries
since the mid-1980s. In addition to occurring in the
West, this has also occurred in emerging markets such
as China and India. The authors of the World Economic
Forum’s Global Risks Report 2012 consider income in-
equality the biggest danger in the world at the moment,
deeming it to be an even greater risk than the sovereign
debt crisis and the steady increase in greenhouse gas
emissions. They state that however encouraging the
growth figures of many emerging markets and develop-
ing countries may be, economic development is often
limited to booming core zones, such as China’s coastal
regions with their centers in Shanghai and Shenzhen, or
cities like Bangalore, Dubai, Singapore, and São Paulo. According to PricewaterhouseCoopers, São Paulo is
the world’s tenth most prosperous city. Although it ac-
counts for six percent of Brazil’s population, it generates
12 percent of the country’s economic output. By 2025
São Paulo may have become the sixth-wealthiest city in
the world and doubled its population to more than 22
million. Over the next 15 years, the biggest annual
growth potential will be found in cities such as Hanoi in
Vietnam, Changchun and Guangzhou in China, Kanpur
in India, Lagos in Nigeria, and Chittagong in
Bangladesh. At the same time, many rural areas are
falling further behind, especially since poor people are
suffering from rising food prices worldwide. According
to the Food and Agriculture Organization, the number
of people suffering from hunger rose by 150 million
over the past 20 years to almost one billion. As a result,
the United Nations’ Millennium Development Goal of
halving the number of people who suffer from hunger
between 1990 and 2015 will not be attained, even
though the share has declined. Improvements have not
been sufficient to offset rapid population growth. PricewaterhouseCoopers’ forecasts for 2050 are nev-
ertheless cause for some optimism. China’s per capita
income on the basis of purchasing power parity will
then be about half that of the United States, while in-
come in Indonesia will be about one fifth that of the U.S.
But what will it mean for planet Earth if billions of for-
merly poor people live like the inhabitants of industrial-
ized nations? That’s precisely the problem, since there
aren’t any global solutions in sight for global challenges
such as poverty, resource scarcity, climate change, mi-
gration, and world trade (Pictures of the Future, Fall
2011, pp. 82-83). A new, globally valid business model
is needed to ensure sustainability. It would not only
have to fulfill people’s wishes for a higher standard of
living without further damaging the environment, but
would also reduce social inequalities. Urs Fitze
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
Source: World Bank / PwC (2011), The World in 2050
How Per Capita GDP Will Change
Per capita GDP ($)
U.S.
Canada
UK
Germany
France
Italy
Japan
Russia
Mexico
Turkey
Brazil
China
Indonesia
India
0
20,000
40,000
60,000
80,000
100,000
Growing Exports...and Where They Are From
Exports of goods, 1950–2010 (in billions of $)
0
2009
2050 Source: UNCTAD / UNCTADstat
ciently large to become an increasingly attrac-
tive market for foreign investments. In 2011 for-
eign direct investments in the country rose by
56 percent compared to the prior year. Siemens,
which has been operating in this Latin American
country since 1954, defines Colombia and other
nations such as Turkey and Vietnam as Second
Wave Emerging Countries (SEWECs, p. 20). These countries are not only experiencing
economic growth that is well above average but
also seeing the emergence of new markets and
profitable sites for local production operations.
The new Siemens facility in Tenjo near Bogotá,
for example, has an extremely efficient manu-
facturing system and meets all of the latest environmental standards (see Pictures of the
12 Pictures of the Future | Spring 2012
even more innovations in order to achieve
growth.”
Due to their global organization, multina-
tional technology companies such as Siemens
can benefit from both of these trends. In
wealthy countries, these companies selectively
invest in extremely high-quality manufacturing
industries as well as in research and innovation
projects. One example of this is Siemens’ pro-
duction of cutting-edge gas turbines in Char-
lotte, North Carolina (p. 33).
Global companies also characteristically es-
tablish production facilities in developing coun-
tries and emerging markets. In addition to fulfill-
ing important supplier functions, these facilities
optimally meet the needs of local markets. Man-
ufacturing and production networks are now
being strengthened and made more efficient
worldwide in order to handle increasing com-
plexity (pp. 22, 26). The importance of manu-
facturing for national economies is emphasized
by Professor Dani Rodrik, an economist at Har-
vard University (p. 15), who says, “Manufactur-
ing creates comparatively well-paid jobs, en-
courages private-sector investment, and paves
the way for the economy’s further diversifica-
tion. That’s where you have to begin in order to
systematically generate employment.” Colombia is a case in point. Although it is not
a major emerging market such as Brazil, Russia,
India, or China (the BRIC countries), Colombia
has great development potential and is suffi-
I
f I were young today, I would go to China,” says 94-
year old British historian Prof. Eric Hobsbawm, who
was born in Austria. The world’s most populous country
has indeed shown incredible dynamism for more than
three decades, and it is on its way to becoming the
world’s greatest economic power. In his book The Age of
Extremes
, Hobsbawm coined the expression “the short
twentieth century,” which, according to him, began with
the political upheavals starting in 1914 and concluded
in 1991 with the collapse of the Soviet Union. Since then, the world has been undergoing changes
whose speed surpasses even that of the “long nine-
teenth century,” when nations became more economi-
cally integrated than ever before, thanks to new tech-
nologies ranging from steam engines to telegraphs. The
nineteenth century was the world’s first age of global-
ization — an era in which raw materials, food, textiles,
capital, and manufactured goods were shipped all over
the world, thanks to free trade and harmonized stan-
dards. Between 1870 and 1913, exports skyrocketed. In
1913, the last year of peace, exports accounted for one
fifth of all the goods produced worldwide. Globalization
then came to a standstill due to the tremendous up-
heaval caused by two World Wars. As a result, right after
the end of World War II, exports accounted for only five
percent of manufactured goods. The focus was instead
on reconstruction and the creation of regional markets
such as the European Economic Community. A new surge of globalization began in the late
1970s, driven by the expansion of free trade, the inter-
national division of work, and the liberalization of finan-
cial markets, and supported by computers, cell phones,
and the Internet. In real terms, goods worth $317 billion
were exported worldwide in 1970. According to the
World Trade Organization, this figure rose to more than
The Next Economy | Facts and Forecasts
Globalization: Greater Prosperity, but more Inequality
$15.2 trillion in 2010 — an almost 50-fold increase. As a
result, trade accounted for one fourth of the world gross
domestic product. For decades, the world’s leading trad-
ing countries were the U.S., Germany, and Japan. The
flow of goods is now shifting, however, and the Interna-
tional Monetary Fund states that 40 percent of the
world’s trade is now conducted in developing countries
and emerging markets. In 2000 that figure amounted to
only 25 percent. Only ten years ago, half of Africa’s exports went to
Europe. That figure has now declined to one third, while
exports to China have risen from four percent to 15 per-
cent. Globalization is entering a new phase. And it’s not
just about China any more, despite the fact that it in-
creased its share of the global economy from four per-
cent in 1992 to 13 percent today, while also becoming
the world’s leading exporter in 2010. The G7 nations,
which are the world’s leading economies (Germany,
France, the UK, Italy, Japan, Canada, and the U.S.), will
face competition in the middle and long terms from the
Emerging 7 (E7) economies: Brazil, Russia, India, China,
Indonesia, Mexico, and Turkey. Business consulting firm
PricewaterhouseCoopers estimates that the E7 nations
have about 72 percent of the economic output of the
G7 countries when calculated on the basis of purchasing
power parity. By 2050, the E7 countries are expected to
generate $140 trillion in terms of their purchasing pow-
er, or twice as much as the G7 nations. India is estimated to have the biggest growth poten-
tial, which means it could become the world’s second-
largest economy after China by 2050. India’s economic
output would then be eight times larger than Ger-
many’s. There are several major reasons for this, includ-
ing the fact that India is a democracy with a highly de-
veloped educational system and a private sector that
has been systematically expanded over the past 20
Comparison of Estimated GDP by 2050
Gross domestic product (in billions of $)
U.S.
China
Japan
India
Germany
Russia
UK
France
Brazil
Italy
Mexico
Spain
South Korea
Canada
Turkey
Indonesia
Australia
Saudi Arabia
Argentina
0
South Africa
Nigeria
Vietnam
5,000
10,000
15,000
40,000
…
…
45,000
50,000
55,000
60,000
Source: World Bank and PWC 2011, The World in 2050 (constant 2009 US$bn)
Estimated gross domestic product
based on purchasing power parity
(PPP) in 2050. China and India will
be in first and second place, respec-
tively, while the U.S. will drop to
third place. Brazil will surpass Russia
and Japan, becoming the world’s
fourth-largest economy. 2009
2050 — Forecast GDP (adjusted for PPP)
1950 1960 1970 1980 1990 1995 2000 2005 2010
BRIC nations (Brazil, Russia, India, China)
Developing countries and emerging markets w/o BRIC
Industrialized nations
Pictures of the Future | Spring 2012 15
Dani Rodrik (54) is Rafiq
Hariri Professor of Inter-
national Political Economy at Harvard University, John F.
Kennedy School of Govern-
ment. He earned his Bachelor
of Arts in Government and
Economics at Harvard, after
which he studied Public Affairs and Economics at
Princeton University. Born in
Istanbul, Turkey, Rodrik holds
a PhD in Economics from
Princeton. A peer group of
leading economists has
ranked him to be among the
100 most influential econo-
mists in the world. Rodrik has
worked extensively on the
question of economic conver-
gence, meaning the mecha-
nisms that are allowing the
developing world to catch up
with developed countries.
The Changing Face of Globalization
The Next Economy | Interview
Does globalization benefit developing
and emerging countries?
Rodrik: There are a few examples where globalization has coincided with a spectacular
rise in wealth and living standards. In par
ticu-
lar over the course of the last ten years emerging and developing countries grew
much more rapidly than was the case in industrialized countries. China and India have
done extremely well. But the picture is highly
varied and differs greatly among individual
countries. Over the last 25 years, for example,
Africa and Latin America have benefitted
much less than other regions from globalization.
What makes the difference between
countries that benefit from globalization
and those that do not?
Rodrik:One thing that successful emerging
countries do w
ell is establishing conditions in
which modern manufacturing flourishes.
China did it. Korea and Japan had done it before, and all t
hree countries were very successful. Manufacturing generates highly
productive labor — with relatively well-paid
jobs — fosters private investment and leads to a diversification of the economy. The trick is to get a toehold in manufacturing
industries and systematically to expand do-
mestic employment in them. I call them auto-
matic-convergence industries, because they
close the income gap with rich countries. Get
these industries on track, make an economy’s
resources flow toward them — and the rest
follows by itself. This really amounts to an au-
tomatic escalator up. By the same token,
countries that rely solely on agriculture and re-
source production miss out. Africa is a particu-
larly dismal example of this.
Get on the escalator and get rich? Is it as
easy as that?
Rodrik:Well, the bad news is that this is not
easy t
o accomplish — there is no cook book of
standard recipes. It w
ould be nice if govern-
ments simply had to stabilize, liberalize, and
open up, and markets would do the rest. The
reality is rather different. Getting it right re-
quires active policy interventions on the part
of emerging economies. In many cases these
include close cooperation between govern-
ment and businesses, direct and indirect subsi-
dies, as well as keeping the currency hyper-
competitive to stimulate the export industry.
Aren’t such interventions against the
spirit of economic globalization?
Rodrik:One of the paradoxes of the last two
decades of g
lobalization is that its biggest
beneficiaries have been those countries th
at
have flouted its rules. They benefited from
easy access to foreign markets but at the same
time exerted active and sometimes interven-
tionist control over their own financial sys-
tems, capital flows and currencies. Direct state
interference and industrial policy measures
have also reaped rewards for these countries
in many cases.
Is this strategy any kind of guarantee of
success for emerging economies over the
coming years?
Rodrik:I doubt that this game can continue in
its pr
esent form. Rich countries are ever less
willing t
o accept such policies. And countries
that hope to jump on the manufacturing
bandwagon might be too late. Asian countries
have built up huge capacity and high efficien-
cies that make it ever more difficult for new-
comers to be competitive. And the financial
and economic crisis does not make the life of
developing countries easier either. Take the
example of Turkey. While the country has
strong potential in the long run, it currently
has an unsustainable external deficit and will
have to undergo a transition away from a bor-
rowing-led model of growth. Catching up for
emerging economies will not be impossible
going forward, but it may be significantly
harder to achieve.
What does this mean for globalization on
the whole?
Rodrik:Globalization today is different fr
om globalization 20 years ago, and it keeps
changing its face. We are no
w starting to understand the downside of insufficiently
tamed globalization; for example the havoc it
can wreak in financial markets. The financial
crisis has reminded us of one important les-
son. Markets are wonderful but they need an
occasional push from the state. Financial mar-
kets in particular are inherently unstable when
they are on their own. So there is a growing
willingness to give globalization better rules.
14 Pictures of the Future | Spring 2012
tems, which have helped to reduce child mor-
tality in the region by around five percent over
the past two years (p. 28). The inhabitants of
the village of Adjuntitas Dos in the Mexican
state of Querétaro have seen their quality of
life improve for a completely different reason.
In 2011 Siemens installed decentralized solar
panels throughout the village, enabling resi-
dents to operate electric lamps without any
power outages. As a result, children find it eas-
ier to do their homework in the evening, and
better education lets them improve their long-
term income outlook as well (p. 19).
Controlled Globalization. Stories like these
provide hope for the future. However, the
world as a whole is obviously still characterized
by great disparities in wealth. Although pros-
perity is steadily increasing, so is the gap be-
tween rich and poor. At the same time that in-
creasing numbers of people are rising above
the poverty line, more and more people are
being born into relative poverty due to high
Until the most serious consequences of the
financial crisis are behind us, trust and strong
partnerships will therefore be indispensable
when dealing with financing issues. Siemens is
responding to this challenge by offering cus-
tomized financing solutions (p. 36). A lot will
depend on whether regulatory organizations
can create rules to help tame economic
processes. If this is possible, emerging markets
might achieve growth that is more sustainable
and less susceptible to setbacks. At the same
time, wealthy nations might find ways to re-
main prosperous in spite of shrinking popula-
tions.
Innovation remains the most important key
to success in highly developed nations and
emerging markets alike. During the Industrial
Revolution, steam-powered looms achieved in-
credible efficiency increases. Today, similar
productivity potentials can be exploited
through even better access to global networks
by means of computers, communications, and
Internet technologies. Productivity could also
tute of International Economics estimates that
this results in losses of around €364 billion in
Germany alone, or about one sixth of the
country’s gross domestic product.
That’s why companies are increasingly striv-
ing not only to make the most of their best em-
ployees’ capabilities but also to make sure that
those capabilities are maintained at a high lev-
el (p. 33). As a result, work will probably be or-
ganized very differently in the future than it is
today. Experts predict that there will be more
project work, more freelance employment,
and more freedom, but also more individual
responsibility. Companies will create a climate
in which it will be easier to put new ideas and
innovations into practice than was the case in
hierarchical systems. The result could be a
flood of ideas and innovations that will cause
the global economy to boom.
In 1926 the Russian economist Nikolai Kon-
dratiev formulated a theory that the economy
develops in decades-long cycles or waves that
progress from one period of technological in-
Thanks to a huge pool of talented workers, production and innovation are increasing in countries such as Brazil, Russia, India, and China. birth rates in developing countries (p. 12).
How should the global economy be organized
so that such disparities can be reduced? Do we
need more globalization — or less?
Perhaps the question should be posed dif-
ferently, as the problem may not be the level of
globalization, but the methods for regulating it
in order to make better use of its advantages
and minimize its drawbacks. The recent finan-
cial crisis has highlighted the risks of insuffi-
cient regulation, showing how the inherent
dynamics of complex systems can turn the
world upside down in unpredictable ways —
and with unexpected speed. “We are just be-
ginning to understand the disadvantages of an
insufficiently controlled globalization process,
such as the upheavals it can cause in financial
markets. Although markets are a great thing to
have, governments need to get them back on
track now and then. Financial markets in par-
ticular are inherently unstable,” says Rodrik. be increased by restructuring global energy
and economic systems in order to better pro-
tect the environment and conserve resources.
This development has just begun, and the re-
quired innovations are being designed by high-
ly skilled experts.
Creating a Climate for New Ideas. Tomor-
row’s talented workers are a company’s great-
est asset. Excellently trained engineers have
become scarce all over the world. But even
though the market value of these individuals is
increasing, the pressures they face are rising as
well. Many of these jobs therefore come at a
personal price in the form of overwork and ex-
haustion, which can lead all the way to com-
plete burnout. But there is an economic di-
mension to this development as well. Too
much work and stress at the workplace re-
duces employees’ individual performance and
causes them to miss work. The Hamburg Insti-
novation to the next. Such paradigm shifts
open up new opportunities and boost efficien-
cy, thus increasing prosperity. Unfortunately,
they also encompass transitional periods in
which painful adjustments need to be made.
“There are many indications that we are once
again in the midst of such a transformation,”
says Tom Kirchmaier. “Small, agile companies
are suddenly appearing in the former centers
of North America’s heavy industry. While the
father may have stood at the assembly line in
Detroit, his son now programs apps that are in
demand worldwide.” The global economy is
changing and enabling new success stories in
the process. These are success stories for entire
nations, as well as for individual companies
and individual people. They can be found in
Mexican hill settlements like Adjuntitas Dos
and at Detroit’s brownfield sites. In both cases,
this success was due to innovations whose
time had come.Andreas Kleinschmidt
Pictures of the Future | Spring 2012 17
Machado first had to set up a local team to
develop the expertise required for this sophisti-
cated technology. This team consisted of a
group of experienced Siemens specialists,
some of them from Germany, as well as Brazil-
ian experts and talented and motivated young
professionals. “It’s becoming more and more
difficult to find qualified technical personnel,
which is why we’re increasingly training peo-
ple ourselves,” says Carlos Tiburcio, Director of
Power Transmission Sales at Siemens in São
Paulo. The Jundiaí plant has therefore set up in-
ternship programs and established partner-
ships with technical colleges and universities
in order to ensure that the workforce remains
completely up to date. This approach also in-
cludes sending employees to headquarters in
Germany. Machado sent 25 engineers to work
at the plant in Nuremberg for two to three
years in order to prepare them for their first
project — a new HVDC link between the Span-
ish mainland and the island of Majorca. The
project was launched in 2009. The team built converter stations for the
Cometa line, which is now transporting energy
produced from mainland wind, solar, and hy-
droelectric power plants to Majorca, thereby
covering a large portion of the island’s electric-
ity requirements. The Majorca project, which
transmits 400 megawatts at 250 kilovolts, was
relatively small by international standards, but
it nevertheless served as a good pilot project
for setting up the required manufacturing ca-
pacity in Brazil and building complex test fields
for transformers.
The Brazilian facility originally utilized
HVDC technology from Siemens in Nuremberg.
“But our engineers have also been working on
their own developments and making adjust-
ments in order to meet the specific needs of lo-
cal markets,” Tiburcio explains. “In some cases,
these changes have almost led to the creation
of a completely new product design.” Motors that Don’t Mind Tropical Weather.
Siemens is also investing in new facilities in
Colombia in the north of South America,
which has undergone rapid economic growth
over the last few years and is considered to be
an insider tip by investors. Rating agencies
have raised Colombia to “Investment Grade,”
which means the country is now viewed as a
safe place to invest. Foreign direct investment
in Colombia did in fact increase by 56 percent
in 2011. Export revenues have also reached
record levels thanks to high prices for raw ma-
terials. Siemens has been present in Colombia
since 1954. In 2009 it opened a state-of-the-
art electric motor factory in Tenjo, near the
capital, Bogotá. The facility has an extremely
efficient manufacturing system and meets all
the latest environmental standards (see Pic-
tures of the Future,Fall 2010, p. 67).
The plant, which received lots of help dur-
ing its ramp-up phase from a sister facility in
Bad Neustadt, Germany, began producing
electric motors of various sizes and perform-
ance classes in May 2011. The motors can be
used in sectors ranging from food production
to the oil and gas industry. “Siemens is now the
first company in Colombia that manufactures
motors boasting the highest international effi-
Brazil is an exceptional case because of the
long distances over which its electricity must
be transmitted. One planned project involves
two parallel lines for moving a total of 11 gi-
gawatts of power across more than 2,000 kilo-
meters — which would set a new world record.
“The operation of such parallel transmission
lines and the converter stations at both ends
must be carefully coordinated in order to en-
sure grid stability,” Tiburcio explains. Siemens
facilities for HVDC technology in Nuremberg,
Jundiaí, Kalwa (India), Zagreb (Croatia) and
Guangzhou (China) maintain constant contact
with one another in order to share information
and ensure that all of them benefit from the
new expertise each develops.
ciency standards,” says Wilson Ruiz, who is re-
sponsible for industrial motor sales in Tenjo. In
addition to their lower energy use, the Colom-
bian motors also have other advantages — for
example, they’re impervious to tropical weath-
er and their voltage and dimensions meet the
requirements of local customers.
The Tenjo plant has already landed three
major orders. The first was placed by the Gras-
co Group — one of Colombia’s biggest compa-
nies — for 200 particularly robust special mo-
tors that are oscillation- and dust-resistant,
among other things. “They’re being used to re-
place older motors in pumps, mills, mixing ma-
chines, and production lines in Grasco’s oil and
butter factory,” says Ruiz. What rules would you propose for better
management of globalization?
Rodrik:We need to regulate cross border capital flows much more intensely. Switzerland and Brazil ha
ve already taken several cautious steps in that direction. The
rules of the World Trade Organization should
become more stringent; currently, for instance, they do not address manipulation of exchange rates appropriately. On the other hand, there are rules we should relax, such as those in the area of labor mobility. Great talent should be able to move more freely across borders. Limited liberalization in this area would create huge economic benefits by allowing people to employ their skills wherever they are used most efficiently.
In your opinion, will capitalism as the dominant economic system change its face, too?
Rodrik:It already is changing its face. Ther
e are many different streams of capital-
ism. Some of t
hem are more liberal, others are less so. And the one thing we know is that we are inevitably moving away from a
purely liberal market-based model. Without a doubt there will be a stronger role for the
state. The bad news is that with growing inequality more people will challenge capitalism on the whole, in spite of its inherent virtues. The financial crisis made it obvious that we have produced a mess in our global economy. But at the same time we are at a loss to figure out what features precisely the capitalist model of the future should have and what this means for globalization.
What is currently the greatest risk to the world economy as it strives to move forward?
Rodrik:One thing that deeply concerns me is ineq
uality. There can be little doubt that inequality between and with
in countries simply keeps growing. On the whole, groups
with high skills and wealth tend to do better,
while blue collar workers tend to lose out. This trend is particularly strong in the most liberal market economies. It bothers me a lot,
because it can affect the political climate and
in some circumstances may give rise to populist and extremist policies.
If you had one million dollars to invest
freely in any of the BRIC countries, where
would you put it?
Rodrik:For now Brazil and India — two countries wit
h great long-term prospects and
stable, participat
ory political systems.
Interview by Andreas Kleinschmidt
16 Pictures of the Future | Spring 2012
Booming nations such as Brazil and Colombia are transforming themselves from raw materials suppliers to manufacturers of high-tech products. Siemens is continually expanding its presence in these countries by creating efficient
and high-quality products for local markets and export.
Full Steam Ahead
The Next Economy | Latin America
B
razil has been experiencing rapid econom-
ic growth for years. In 2011, according to a
report issued in December of that year by the
London-based Centre for Economics and Busi-
ness Research, it overtook the UK to become
the world’s sixth-largest economy. The discov-
ery of new oil deposits is contributing to this
trend, enabling Brazil to make substantial in-
vestments in new infrastructure — especially
power supply systems, which have long been a
weak spot in the country’s development. How-
ever, special converter stations and high-per-
formance transformers are still needed for
high-voltage direct current transmission lines
(HVDC), which transport energy across large
distances (see Pictures of the Future,Fall 2011,
p. 5; Fall 2009, p. 25).
Since 2006, Siemens has been able to man-
ufacture all of the necessary components for
the country’s power transmission needs at its
own facility in Brazil. That gives the company a
major competitive edge. “Transport costs are
very high in HVDC projects,” says Tamyres
Machado, Technical Director at the Siemens
plant in Jundiaí, near São Paulo, the biggest
production facility for energy systems in South
America. The transformers alone, which step
up direct current to as much as 800,000 volts
for transmission, are almost as big as a single-
family house and weigh around 100 tons. “We
build everything here in Brazil, so we’re able to
offer a good price,” says Machado.
Local Design. Jundiaí is one of five Siemens
locations around the world that manufacture
HVDC systems. “We’re number two after
Nuremberg, Germany, in terms of know-how,”
Machado says proudly. “Brazil urgently needs
more energy — and the best way to get it is
with hydroelectric power plus HVDC.” New
“power highways” are also being planned in
Chile and other Latin American countries, and
the U.S. is expanding its use of this technology
as well. “We’re manufacturing two transform-
ers for a planned HVDC link between New York
and New Jersey,” Machado says.
In Brazil, Siemens makes capacitors for HVDC transmission lines (large picture). In Colombia, the company has produced power transformers since 1956.
Some 30,000 people living in Mexico’s Querétaro mountains
aren’t connected to the power grid. To help them, Siemens has
installed solar power systems that supply more than 180 homes.
Solar modules and energy-saving bulbs not only bring light to people in remote regions of Mexico; they also improve the quality of their lives.
New Lives with Light
Querétaro, Cruz and her family have had to get
by without electricity all their lives.
But those days are now over. Since the sum-
mer of 2011, a little lamp goes on in the Cruz
family’s home every evening. An Osram com-
pact fluorescent light bulb illuminates the
table where they eat, and there’s another bulb
over the hammock used by Bernardino, the
couple’s eight-year-old son. Electricity for the
bulbs comes from a solar module on the roof. As part of project “Luz Cerca de Todos”
(Light close to everyone), Siemens technicians
have installed 182 solar modules in Adjuntitas
Dos and nine other communities within a ra-
dius of 50 kilometers. They have also delivered
new batteries that store the electricity generat-
ed during the day. For the people in the
rugged, picturesque mountains, this has been
like “daybreak in the evening,” says Juárez.
Now Bernardino can read a little before going
to sleep, and his older sister has more time to
do her homework. The two children are look-
ing forward to the day when they will be able
to listen to music and watch television — and
to find out about what’s happening in the
world.
While people in industrialized nations take
power from electrical sockets for granted, the
International Energy Agency (IEA) reports that
20 percent of the world’s population still has
no access to electricity — that’s a total of 1.4
billion people, most of whom live in Africa and
South Asia. But even in Mexico, where electrifi-
cation had reached almost 97 percent of the
population by 2010, 3.5 million people still live
without electricity. Most of them are residents
of rural communities in remote locations, like
Adjuntitas Dos.
A World Bank report has shown that elec-
tricity can greatly improve living conditions in
such rural areas. Electrical power has positive
effects on education, health, and economic
development, according to the report. Electric
lighting enables school children to study in the
evening. Using light bulbs instead of candles
I
n the village of Adjuntitas Dos in the high-
lands of the state of Querétaro, Mexico, time
seems to have stood still. Like everyone in the
village, Artemio Juárez, the village elder, works
his steep, stony fields with a hoe, carrying seed
in a bag slung over his shoulder. His main
means of transportation is a wheelbarrow. There are no cars or trucks in this village of
about 100 inhabitants, which is located 200
kilometers north of Mexico City at an altitude
of 1,800 meters. The village’s 14 households
have neither access to the public power grid
nor running water, nor can they connect to a
fixed or mobile communications network.
“We’re somehow lost up here in the hills,” says
Lucía Cruz, Artemio Juárez’s wife. “We have no
roads and nobody has an electric light.” Like
nearly 30,000 other people in the state of
The Next Economy | Photovoltaic Solutions
Pictures of the Future | Spring 2012 19
improves air quality in the home, and having
television helps people to stay informed about
health and agricultural issues. What’s more,
electrification often makes it possible to start
mini businesses. For example, a villager with a
refrigerator can rent space in it or sell cold bev-
erages.
Helping People Live Better Lives. Plans call
for Querétaro to continue to improve services.
Governor José Calzada plans to supply all resi-
dents of the state with power by 2013.
Siemens has played a crucial role in the initial
steps of this project. The company’s Energy
Sector not only opened a new power plant in
Querétaro in 2011 but also provided the
€230,000 needed to pay for the solar modules
that have been installed to date. It also organ-
18 Pictures of the Future | Spring 2012
Siemens was chosen from among numer-
ous bidders because of its motors’ high effi-
ciency and their good compatibility. “Another
key point was the local support we offer,” adds
Ruiz, who stresses how enormously important
direct contact with the customer is in such situ-
ations. “Customers appreciate our local serv-
ice. Having a factory near them is a key advan-
tage,” he says. Siemens also helped Frito Lay
conduct an energy consumption study that led
the potato chip and snack manufacturer to re-
place many of its old motors with efficient
electric ones from Siemens. Cemex, an inter-
national cement manufacturer, opted for
Siemens motors mainly because of their great
reliability. “Our new motors will significantly
reduce downtime at that company’s packaging
facilities,” says Ruiz.
Energy suppliers and industry aren’t the
only booming sectors in the emerging markets
of South America; demand for healthcare solu-
tions is also rising. Siemens began manufactur-
ing entry-level X-ray machines in Brazil ten
years ago. “We decided to produce inside the
country so that we could compete locally with
aggressive pricing,” says Guilherme Marques,
Director of the Clinical Products Department at
Siemens in Brazil. A Siemens plant in São Paulo
manufactures Multix B analog X-ray machines
that are known for their flexibility and compact
design. They also deliver outstanding image
quality and minimal radiation. The devices are
sold in Brazil where they fulfill customer re-
quirements as well as price expectations. In order to meet rising demand, production
volumes will be increased in 2012. “In June,
we’ll move into a new factory in Joinville,
which will make us more competitive and will
boost local know-how. We also plan to expand
our product portfolio,” Marques reports.
Brazilian customer interest in digital X-ray tech-
nology has increased, but price has been a bar-
rier. With this in mind, Siemens’ entry-level
Multix Select DR digital X-ray machine will be
manufactured at the site. The machine will
provide an affordable digital solution that is
not only robust, but easy to operate. Further-
more, CT and MR systems for the local market
will also be produced in Joinville. To support its local activities, but also be-
cause of its long-term commitment to the
country, Siemens intends to conduct associat-
ed work at Joinville. Development
activities for local and regional mar-
kets will increasingly be conducted
on-site. This is already the case to
some extent at Siemens’ plant in
Tenjo, Colombia, although the facil-
ity still relies on German expertise
for its new motors. Siemens has
been building transformers in Colombia since
1956 — everything from small systems for
power distribution to large high-performance
units. Over the last two years, the Tenjo plant
has specializing in production of distribution
transformers for renewable energy facilities.
“This market is growing rapidly, particularly in
the U.S. and Canada,” says Head of Trans-
former Marketing Andrés Villate, Extreme Conditions. Colombia has large
ports on its Pacific and Atlantic coasts, which
puts it in a strategic position for exporting to
North America. Colombian engineers were
largely responsible for developing the high-
performance transformers produced in Tenjo. Their biggest challenge was the unfavor-
able weather conditions in which the units
need to operate. “Most wind farms in North
America are located in remote areas often
marked by extreme temperatures and high
winds. That means that their transformers
need to be particularly reliable,” says Villate. Specialized transformers for use in renew-
able energy generation systems are in great
demand. As Tenjo Sales Director Jairo Sandoval
reports, Siemens delivered 41 transformers to
the Flat Water wind farm in Nebraska at the
beginning of 2011. The First Light Project —
the largest solar park in Canada — has ordered
ten transformers. “These units only account for
ten percent of our production at the moment,
but that figure is sure to increase over the next
few years,” says Sandoval.
Siemens pays close attention to the envi-
ronmental compatibility of all of its products,
which is why Colombian engineers are now
testing the use of vegetable oil as a coolant
and insulating fluid for the first time in South
America. Mineral or silicone oil is normally uti-
lized for these purposes in transformers, but
the substances are harmful to the environ-
ment, which is why transformers out in the
open need to be protected against leaks. “The oils that we’re currently testing don’t
contain any mineral oils or halogens, silicone
oils, or other problematic substances,” Villate
says. “They also stand out through their high
flash point and good dielectric properties.”
State-of-the-art, environmentally-friendly tech-
nology and high efficiency are attributes that
customers around the world appreciate in
Siemens products — and North and South
America are no different in this regard.
Through its growing presence in local markets,
Siemens is now in a perfect position to provide
South American customers with the right solu-
tions.Ute Kehse
Colombian engineers are testing
vegetable oils as insulating fluids for the first time in South America.
Whether it’s transformers from Colombia (left) or X-ray equipment from Brazil, top products made in South America are increasingly in demand on the world market.
Pictures of the Future | Spring 2012 21
In the industrial district of Inegöl near the Turkish city of Bursa, wastewater is being treated in one of the largest biological treatment plants in Europe.
Waste Not, Want Not
The Next Economy | Water Purification
ment, where most of these contaminants have
been removed.
Excess biological sludge is then transferred
to the facility’s “Cannibal” solids reduction sys-
tem (see Pictures of the Future, Spring 2005,
p. 78), after which biodegradable substances
are broken down even further. Depending on
the bacteria cultures involved, this entails alter-
nating treatment stages, some of which re-
quire additional oxygen. As a result of this
patented process, bacteria work much more
efficiently and the amount of waste-activated
sludge — the collection of microorganisms
that decompose the organic materials in a bio-
logical treatment process — is reduced by 30
to 50 percent compared to a conventional
process. Any biological solids still present fol-
lowing these steps are subsequently dewa-
tered, dried and sent to a cement factory for
incineration. The use of the new technology eliminates a
substantial part of waste-activated sludge and
reduces drying and incineration costs. After
treatment, the water is fed into a reservoir,
where it is used for irrigation on farms.
Major Market. As a result of its reduced ener-
gy use and sludge-disposal costs, the Inegöl
plant will save its operators approximately
€1.5 million per year once the facility is run-
ning at full capacity. “That’s attractive for the
companies involved, because they will have to
pay part of the facility’s operating costs,” says
Bulutlar. Thanks to this biological treatment
plant, which saves space, water, and energy,
Siemens has established a leading position in
the field of wastewater purification in Turkey.
“The Inegöl project demonstrates how fruitful
cooperation with a globally operating supplier
like Siemens can be,” says Bulutlar. “The com-
pany not only has extensive experience but
also boasts a great deal of technical expertise
and offers a broad range of solutions.”
“Turkey has a lot of catching up to do,” adds
Bulutlar. “It would like to gradually reach the
level of the European Union — an ambition
that will require substantial investment.” With
this in mind, the Turkish Ministry for Science,
Industry, and Technology is introducing a
range of incentives to spur the connection of
the country’s industrial zones to water purifica-
tion systems. According to statistics from 2009, only 70
of 120 large industrial zones in Turkey have
been connected to such systems. But over the
next four years, Turkey’s plans call for the
wastewater from 43 more industrial zones to
be purified. For Siemens, Inegöl is an ideal
showcase project. Not only is it located in a dy-
namic industrial region; it also had to over-
come a wide variety of challenges.
Martin Arnold
Siemens’ largest biological sewage treatment plant in Europe is located in the city of Bursa. Thanks to reduced costs for power and sludge disposal, the new plant saves €1.5 million per year. 20 Pictures of the Future | Spring 2012
school. They usually don’t get home until it’s
dark outside,” says Hernández. Before, light
was such a precious commodity that families
considered it extravagant to light candles so
that children could do their homework. “Now
the kids are doing their homework, and their
parents are in a better position to help them,”
Hernández says. In addition to providing solar
power systems for private households,
Siemens also installed ten slightly bigger com-
munity systems in schools, churches and stor-
age buildings that supply enough electricity for
a refrigerator or a computer.
A report from the World Bank shows that
electricity in rural areas is used primarily for
lighting, followed by televisions and refrigera-
tion. Electrical appliances and devices are still
rare in the mountains of Querétaro. “Some
households have a radio, but very few have a
TV or mobile phone,” says Hernández.
When electricity became available, the first
thing residents of Adjuntitas Dos had to learn
was how to use it intelligently. Typically, a fam-
ily will have enough solar power for four light
bulbs and one radio for about four hours. “We
explained to them that they would have to
turn off the light and radio when leaving a
room,” Hernández recalls. “That disappointed
them a little at first, but on the whole they’re
very happy about this change.” Ute Kehse
ized their installation. “In addition to creating
jobs and expanding our business in the region,
we also want to contribute to the development
of the communities. That’s why we organize
programs that improve people’s quality of life,”
says Louise Goeser, CEO of Siemens
Mesoamérica, who points out that Siemens
wanted to set an example and show that it
pays to support social development. But meet-
ing these goals was not easy. Solar panels had
to be transported into the mountains. It took
eight weeks to install them in ten villages,
some of which are a two-hour walk from the
next road. The work was compli-
cated by periods of torrential rain-
fall. For project leader José
Hernández the project has a pow-
erful symbolic character. “The in-
habitants of Querétaro represent
all people who have no access to
electricity. We want to show how electricity
can bring about a decisive change in their
lives,” he says.
Seeing the Light. Free power in Adjuntitas
Dos is enabling villagers to save a lot of money.
“People here used to spend 40 percent of their
income on candles, batteries, and fuel,” says
Hernández. “They used car batteries to provide
electricity for TV viewing, for example.” Some
of the farmers are using the savings to hire
workers. “They can cultivate larger areas,
achieve bigger harvests, and improve their fi-
nancial situation,” Hernández reports. Having
light in the evening helps village children to
study for longer periods. “The kids have to help
their parents by working in the fields after
Identifying the Second Wave of Countries Driving Growth
The map of the world’s most important economies is going to change significantly over the next 20 years,
and Siemens intends to be part of this development from the outset. Between March and June 2011, a team
from Siemens’ Strategy Department worked on an initial project phase in which particularly promising countries
— known as Second Wave Emerging Countries (SEWEC) — were identified and the most important areas of
growth analyzed. “SEWECs will play an important role in the future, in the same way that the BRIC countries —
Brazil, Russia, India, and China — are the most important driving forces of global economic growth today,” ex-
plains Marianne Kiener, who led the team. While selecting the countries for the SEWEC project, Kiener’s team
analyzed how much each country was investing in business areas of relevance for Siemens. Further criteria in-
cluded gross national product, population, educational levels, and raw materials reserves. The countries select-
ed were Indonesia, Colombia, Mexico, Thailand, Turkey, and Vietnam. New production capacity and infrastruc-
ture is currently being created in Turkey; Thailand is investing in new power plants that will expand its energy
supply infrastructure and in high speed trains; and Mexico intends to expand its oil and gas industry. “The re-
spective international Siemens companies have taken over the more exact analysis of national trends in the pro-
ject’s second phase and have developed concrete visions of how their countries will look by 2030,” says Kiener.
Local project teams are now working together with the Siemens sectors to develop strategies that will create
the conditions needed to promote the expected development.
F
or many years, Turkey has been growing
faster than almost any other country in the
world. In 2010 its economic growth was al-
most nine percent, and the figure for 2011
was probably almost as high. Increases in the
country’s industrial output — and in its energy
and water demand — have been correspond-
ingly large. One example of all this growth is
the industrial district of Inegöl, which is in Bur-
sa, a city of 1.9 million located roughly 150
kilometers south of Istanbul. Companies from
the textile, glass, wood, and furniture indus-
tries have settled here. They have since been
joined by firms from the chemicals, food &
beverage, and automotive sectors. The waste-
water from these companies is channeled into
a 12-kilometer sewage network, which also re-
ceives around half of the wastewater produced
by the inhabitants of Inegöl.
Bursa’s existing sewage treatment plant
was built in 2000 with a capacity of 55,000 cu-
bic meters per day. In 2007, due to the steady
growth of the city’s industrial district, a consor-
tium consisting of Siemens and Turkish infra-
structure developer Alke was commissioned to
expand the plant’s capacity to 130,000 cubic
meters of water per day and equip it with a bi-
ological sludge reduction system. The city’s demands and specifications pre-
sented a considerable challenge. For instance,
the modernized treatment plant had to con-
sume less energy, generate fewer operating
costs, and produce less sludge. What’s more, it
had to do all this even though there was no
room to enlarge it.
Nonetheless, the complex project was suc-
cessful. “In fact, the facility is Siemens’ largest
biological treatment plant in Europe,” says Er-
soy Bulutlar, head of Siemens Water Technolo-
gies in Turkey. Thanks to the plant’s VertiCel
process, a technique developed by Siemens,
the biological treatment process now requires
less energy. Siemens optimized the process by
integrating a number of water treatment
stages, including the removal and treatment of
solid materials.
Aerated Solution. In order to treat waste-
water, bacteria need oxygen. But adding oxy-
gen requires a great deal of energy. Further
complicating the picture is the fact that waste-
water contains surfactants and other impuri-
ties against which conventional aeration sys-
tems have little effect. Fine-bubble aeration is
considered to be the most energy-efficient
clean water transfer process, but is significant-
ly impacted by contaminants in untreated
wastewater. To address this problem, the Verti-
Cel process uses an optimal combination of ef-
ficient vertical disc surface aerators at the front
end of the biological process, followed by fine
bubble aeration in the latter stages of treat-
Children can now do their homework in the evening thanks
to free solar electricity.
Pictures of the Future | Spring 2012 23
Natural disasters such as Iceland’s 2010 volcanic eruption, Thailand’s 2011 floods, and the earthquake and subsequent tsunami that hit Japan in 2011 can have a devastating effect on a company’s logistics chains. In such cases, systematic and effective crisis management is a must.
Global logistics chains are the lifelines of business. Natural disasters such as a volcanic eruption in Iceland (top), a tsunami in Japan, and floods in Thailand (bottom) present a
huge challenge to logistics systems. Information Lifelines
22 Pictures of the Future | Spring 2012
tomers. This type of complex product is always
a global product, because it can’t be created
without the use of resources from around the
world.
It’s virtually impossible to grasp the scope
of the global logistics chain for a high-tech
product. That’s why a network of cargo ships,
airplanes, trains, and trucks must be intelli-
gently managed with computers in order to
keep transport times and warehousing periods
to a minimum. A high level of flexibility is re-
quired if a company is to be able to react quick-
ly to changed conditions. A study recently conducted by the Pricewa-
terhouseCoopers auditing and consulting firm
has concluded that the biggest challenges for
the supply chains of the future will involve cli-
mate change and rising energy costs due to
higher oil prices. Most of the experts cited in
the study agree that higher transport costs will
result in a return to a greater number of re-
gional production networks with nearby sup-
pliers between now and 2030. According to the study, this does not mean
that companies with worldwide supply chains
will bring production home in a wave of anti-
globalization. Instead, autonomous networks
will form, especially in the emerging markets
of Asia. These networks will supply local mar-
kets with products that are shipped at lower
cost and can be quickly adapted locally in line
with changing customer requirements.
The study also predicts that greater aware-
ness of sustainability issues among consumers
T
here is very little difference between a
global production network and a small fur-
niture manufacturing operation. In both cases,
a workpiece or component is sent from one
station to the next, where it’s processed fur-
ther and connected with other parts. The end
result is a finished product. But unlike a sofa,
chair, or table, a state-of-the-art high-tech
product equipped with complex electronic sys-
tems requires a large number of materials and
process steps. Raw materials from all over the
world — whether they’re metals, semiconduc-
tors or specialized plastics — need to be
processed into many different sub-compo-
nents, such as microchips, boards, and dis-
plays, and then combined in a final assembly
process before being shipped to far-flung cus-
The Next Economy | Global Logistics Chains
nor problems, they can very quickly lead to a
major system failure that shuts down the en-
tire network. Martin Bellhäuser works at Siemens Supply
Chain Management, where he’s responsible
for coordinating the decision-makers in the
company’s global supply chain in the event of a
crisis. “Ensuring the continued flow of informa-
tion inside and outside the company is the
most important thing in a crisis,” Bellhäuser
says. “We need to gather all the available infor-
mation as quickly as possible and make sure it
gets to the right people throughout the com-
pany.” It’s only after crucial information has
been properly disseminated that strategies can
be implemented to correct problems — much
in the way a bypass operation enables obstruc-
tions in the bloodstream to be circumvented
until the blockages are cleared. “You can prepare for many types of events
and risks, but in most cases you can only react
to them — as is the case with natural disas-
ters,” Bellhäuser explains. “The important thing
is to be fast, flexible, and creative and, above
all, to learn from every crisis.” Back in April 2010, an ash cloud created by
the eruption of the Eyjafjallajökull volcano in
Iceland shut down a large portion of European
air traffic for several days. The Siemens crisis
management team responded by chartering
airplanes at Russian airports that were still
open, and thus avoiding the airports that had
been closed. “In most cases only small planes
were available, and these were very expensive
will lead to a noticeable change in consumer
behavior. For example, by 2030 consumers in
the West in particular will more frequently
choose domestically-manufactured products
over imports than is the case today. A majority of the experts questioned for the
study also expect to see a major breakthrough
in terms of intelligent traffic guidance and au-
tonomous freight transport systems sometime
before 2030, with these systems making logis-
tics more efficient, flexible, and environmen-
tally friendly. Dealing with disturbances and interrup-
tions in the transport process has always been
a key logistics issue. Like a blocked artery, sud-
den bottlenecks can occur in global supply
chains, and although they may start out as mi-
aster’s impact on the logistics chain. “The pic-
ture was pretty clear — we had no production
facilities of our own in the affected region and
also very few suppliers, although some of
these were responsible for delivering urgently
needed key technologies,” Bellhäuser explains.
The systems in question included compo-
nents for process control technologies and film
capacitors, which are essential for many differ-
ent types of circuit boards. “We coordinated
closely with the suppliers in question, who reg-
ularly provided us with status reports on repair
work,” says Bellhäuser. “This enabled us to
quickly access extensive information about the
estimated production downtimes for each
component. We were then able to react ac-
cordingly.” Siemens also transferred some of its com-
ponent orders to alternative companies in or-
der to reduce pressure on its suppliers in the
affected region. This in turn allowed Japanese
suppliers to focus on urgent repair work.
In cases where alternative manufacturing
plants couldn’t make up for component short-
ages, Siemens began to purchase parts on the
open market. “For instance,” Bellhäuser recalls,
“we experienced a bottleneck with regard to
LED displays. Our procurement people reacted
quickly by buying the necessary components
on the open market. In the end, excellent com-
munication and the exemplary support we re-
ceived from our suppliers enabled us to get
Pictures of the Future | Spring 2012 2524 Pictures of the Future | Spring 2012
in relation to the amount of cargo that could
be flown in them,” says Bellhäuser. “Siemens
therefore organized an international cargo-
space exchange that allowed the expensive
charter planes to be used not only to ship ur-
gently needed spare parts but also to get im-
portant deliveries to customers as efficiently as
possible.” Shortly after the ash cloud formed, Bell-
häuser and his team set up a global, internal,
and multi-level crisis communication network
capable of providing information as quickly as
possible to local managers and incorporating
them into the network in cases of emergency.
This measure proved to be extremely helpful a
little less than a year later.
Dealing with Disasters. On March 11, 2011,
an earthquake and a subsequent tsunami de-
stroyed the northeastern coast of Japan’s main
island, Honshu. At least 15,840 people died as
a result. The catastrophic events led to several
accidents at nuclear power plants in the re-
gion, most notably in Fukushima Daiichi,
where a meltdown occurred and radioactive
substances were released that contaminated
air, water, soil, and food in the surrounding
area.
Siemens employs about 2,300 people in
Japan. Most of them in Tokyo, Sendai, and
Morioka. Fortunately, not a single employee
was killed or injured by the earthquake or the
Honoring High-Performance Suppliers “We need your support,” said Barbara Kux, who is responsible for Supply Chain Management at Siemens,
during the company’s Supplier Forum held in November 2011. Kux’s appeal was directed at the top man-
agers of 32 especially reliable and effective supplier companies, whose combined sales of €4 billion to
Siemens represent around 10 percent of the company’s annual procurement volume. The goal that moti-
vated this appeal is clear. Siemens is looking to break the €100 billion sales mark in the medium term —
and that can only be done with the help of high-performance suppliers. Kux has been focusing on the systematic further development of supplier relationships since she joined
the Siemens Managing Board. Her goal is to establish long-term strategic partnerships with suppliers
and a stable network that will help both sides generate new business and a permanent competitive ad-
vantage. “Our goal is to optimally link our strengths with the capabilities and expertise of our suppliers,”
Kux explains. “By bringing them into the product development process, we can achieve a maximum de-
gree of innovation at an early stage. This helps both Siemens and its suppliers to improve their competi-
tive position on the market.”
A key element of this strategy is the annual Siemens Supplier Forum, which was launched in 2009.
Siemens invites around 30 of the most important strategic “partners for growth” to the forums, where
they can meet and talk with the Group’s executive management team. The forum is not only a vehicle
tsunami. Siemens’ Healthcare Sector is very ac-
tive in Japan, and many Siemens production
lines require customer-specific components
manufactured in Japan, especially electronics
and electromechanical parts. “Of course, the most important thing initial-
ly was to make sure our people were safe,”
Bellhäuser recalls. “We used our communica-
tion network to collect as much information as
possible and piece together a complete
overview of the situation on the ground.” It
quickly became clear that the service techni-
cians from Siemens Healthcare needed to stay
mobile in order to ensure that optimal medical
care could be provided by Japanese hospitals.
“To ensure that technicians would be able to
do their work despite the scarcity of fuel,
Siemens sent out workers to take all available
service vehicles to gas stations, which in some
cases had waiting lines that were several kilo-
meters long,” says Bellhäuser. This ensured
that a fueled vehicle would always be avail-
able. Siemens also launched a company-wide do-
nation drive to help earthquake and tsunami
victims; the company collected a total of €6
million. In addition, Siemens donated equip-
ment such as mobile ultrasound units and
reagents for laboratory analyses in order to
support local medical care. Once the company knew its staff in Japan
was safe, specialists began to examine the dis-
through the terrible catastrophe in Japan with
virtually no damage to speak of. There were no
major production shutdowns whatsoever.” Transparent internal communication is an
indispensable part of logistics crisis manage-
ment. For example, many Siemens employees
outside Japan were worried about using com-
ponents from the country after the accidents
at the nuclear power plants were reported.
“We met with experts and carefully analyzed
the risk of contamination from Japanese com-
ponents,” Bellhäuser says. “It was determined
that the understandable fears of our people
were unfounded in all cases, and it turned out
that many components had already been
loaded onto cargo ships that sailed weeks be-
fore the disaster. This allowed us to quickly al-
lay the fears and concerns of our employees
outside Japan.”
Lessons for the Future. What lessons did
Siemens Supply Chain Management learn
from the events in Japan? “The most important
thing we realized is that you risk having major
problems if you use only one supplier for a cer-
tain component,” says Bellhäuser. “That’s why
we’re making a greater effort to reach agree-
ments with other suppliers in regions prone to
earthquakes and other disasters so that we can
fall back on them in emergencies.”
“The floods in Thailand in the fall of 2011
also showed us how dangerous it is when a
component that is needed at manufacturing fa-
cilities around the world is mainly procured
from only one region,” Bellhäuser adds. Thailand produces more than one third of
the world’s computer hard drives, for example,
and production is concentrated in the region
around Bangkok, which was hit by the floods.
The disastrous floods in the region shut down
virtually all production in a very short time. The
delivery estimates of many major suppliers
such as Seagate, Hitachi, Toshiba, and Western
Digital plummeted. The latter two firms cut
their delivery forecasts by around 50 percent.
This resulted in an unprecedented rise in the
prices of hard drives and a huge decline in earn-
ings at the manufacturers. Western Digital, the
world’s leading manufacturer of hard drives, re-
ports that it won’t return to pre-disaster produc-
tion levels until September 2012. The floods in Thailand have made it obvious
to everyone that even though clustering — i.e.
the concentration of similar industries in the
same region — can reduce transport costs and
generate positive synergy effects, it can also
cause huge economic disruptions. Suppliers
around the globe will probably have to rethink
their clustering strategies in certain regions in
the future if they want to achieve more effec-
tive crisis management — especially in times of
climate change. Nils Ehrenberg
Containers have revolutionized maritime shipping. The world’s largest container ship, the Emma Maersk, can transport almost 15,000 standard-size containers. Siemens’ security center in Erlangen, Germany, is staffed around the clock and is responsible for coordinating the company’s emergency operations. for sharing experiences, however; it’s also designed to generate ideas for joint development processes.
Several of the associated lighthouse projects at the forum have already proved extremely successful. Two internal processes — the Siemens Production System (SPS) and the Siemens Energy Efficiency Pro-
gram (EEP) — have now been expanded to several suppliers, for example (see Pictures of the Future,
Spring 2009, p.30, and Fall 2011, p. 98). This transfer of know-how has helped logistics companies such
as Deutsche Bahn Schenker to use EEP to significantly improve their energy balance at selected loca-
tions. Joint optimization measures undertaken with Siemens supplier KSB AG have also lowered produc-
tion costs for solar power plant pumps by almost 40 percent. The forum is also used to present awards to suppliers who are especially innovative, create exceptional
value, and operate in accordance with sustainability principles. The award for the best supplier in 2010
went to Texas Instruments, which has not only been supplying Siemens with semiconductors for more
than 30 years but is also supporting Siemens’ market leadership in certain areas by providing the compa-
ny with innovations it has developed in-house. The coveted trophy was issued to Weidmüller GmbH &
Co. KG in 2011 in recognition of its outstanding service. The Renesas Electronics Corporation accepted
an award on behalf of all Japanese supplier companies for their extraordinary effort and dedication in
the aftermath of the earthquake/tsunami disaster. Despite extensive destruction of supplier production
facilities, these companies did everything humanly possible to keep the logistics chain running and to
maintain Siemens’ ability to deliver products to its customers.
The Supplier Forum will continue to be an important component of the supplier management system in
the future. “I don’t regard the forum as an individual event that takes place only once a year,” says Kux.
“The numerous lighthouse projects make it a process that continually generates added value for all par-
ties. That’s the only way to permanently safeguard the competitive advantages we’ve achieved.”
Pictures of the Future | Spring 2012 27
International companies not only serve global sales markets but also manufacture their products in many countries. At Siemens, identifying the optimal locations to place factories and thus balance the company’ global needs with those of local markets, is becoming a science.
After a structured analysis, facility planners selected
Goa in India as a new manufacturing location (right).
A ready-made concept for a standard electronics facility was then adapted to regional conditions. Sweet Spot Science
26 Pictures of the Future | Spring 2012
closer look at factors that determine cus-
tomers’ purchasing decisions, as well as mar-
ket development aspects and competitors’ be-
havior.” This can sometimes lead to an
expansion of manufacturing facilities in indus-
trialized nations — as was the case when
Siemens invested more than $350 million in
the production of state-of-the-art gas turbines
at a plant in Charlotte, North Carolina, in 2011.
The turbines are high-end components whose
production requires skilled workers, precision
technologies, and intensive research. “All of
these requirements make the U.S. a very at-
tractive location for us to manufacture such
products competitively, because access to in-
novators is much more important here than
cheap labor,” says Eric Spiegel, CEO of Siemens
Corporation in the U.S. Success Factors. In order to identify the best
locations for future manufacturing facilities,
Siemens focuses on several key success fac-
tors. “The main factors are profitability, speed,
delivery flexibility, process quality, and innova-
tive capability,” says Kaske. Each of these fac-
tors must be weighted differently because
their importance varies depending on the cus-
tomer, sales region, and product line in ques-
tion. “The next step involves determining how
well the existing production network fits in
with these factors, as well as analyzing factors
such as dependence on development and the
existing supplier network,” says Kaske. In the
subsequent design phase, specialists develop
various network scenarios and examine their
total cost impact. “By the time the process is
over, we have several scenarios and can then
decide which ones we want to implement,” he
adds.
This is no one-time process. “It’s actually
meant to become part of a continual footprint
management system — in other words, a reg-
ularly scheduled monitoring procedure that re-
veals areas where we can make improvements
as we go through the annual strategic plan-
ning process.” Although this method takes up
more time and resources than a reactive ap-
proach, Kaske is convinced that the benefits
outweigh any drawbacks: “With this approach,
we can not only make the entire network more
flexible and effective but also take long-term
trends into account in the early planning
C
ompanies often used to be very casual
about deciding where to build their facto-
ries,” says Jörg-Henning Kaske, who is respon-
sible for Manufacturing Standards & Guidance
at Siemens Corporate Technology (CT). “You
could even go so far as to say that production
location decisions were often made on the ba-
sis of anticipated wage cost savings — but
that’s simply not enough any more.” These
days, global production networks and the dis-
tribution of manufacturing centers need to be
carefully planned and closely aligned with cor-
porate strategy and market and customer re-
quirements. “That’s why we developed a new
approach for a global manufacturing footprint
design that systematically examines the exist-
ing network and is geared to our customers’ re-
quirements,” says Kaske
A key focus here is to identify the weak
points in conventional network planning. “Up
until recently, networks were usually adjusted
selectively in response to substantial cost-re-
duction pressures,” Kaske explains. “In such
cases, a location in Europe would be closed
and a new one built in Asia, for example. The
new technique, on the other hand, takes a
The Next Economy | Facility Planning
planning concept made us faster and also al-
lowed us to precisely predict costs and remain
within budget,” says Schumann. However, he is also aware of the drawbacks
associated with generic factory types. “Al-
though our concept does harbor the risk that
we might overlook certain unusual solutions,
the benefits of rapid planning and precise cost
forecasts generally outweigh that risk.”
The new facility in Goa will play a key role in
the Energy Automation production network.
For one thing, the devices manufactured there
will be exported to emerging markets, where
they will support a number of countries as they
seek to establish smart grid infrastructures
(see Pictures of the Future,Spring 2011, p.22).
“If you want to integrate renewable energy
into a national grid in a meaningful way, you
need an intelligent network and computer-
controlled protection equipment to handle the
output fluctuations this type of energy is sus-
ceptible to,” says Schumann. And there is another reason why Goa is so
important: A development department in the
facility will be used to create customized
“SMART” products for the Asian market, where-
whose transmission capacity will be more than
double that of the old 800-kV network. Long-term plans call for Goa to expand into
a global production center for emerging mar-
kets. “The main plant in Berlin will still manage
network coordination between manufacturing
locations in the UK and China,” says Schu-
mann. “For example, Berlin will ensure that the
same machinery is used at all facilities and that
product data remains consistent at all facto-
ries.” This will make it possible to quickly com-
pensate for a production shutdown at one lo-
cation by having a second facility pick up the
slack. Even so, development activities in Goa
will give the plant there extensive freedom
when it comes to manufacturing specific prod-
uct series for emerging markets.
Kaske believes Siemens will be in a strong
position once the new approaches have been
refined and applied. “Strategically planned dis-
tribution of manufacturing facilities, rapid and
economical on-site implementation on the ba-
sis of sample factory types, and global produc-
tion with uniform standards —” he says, “these
will be the essential elements of the network
of the future.” Nils Ehrenberg
another group worked largely independently
on the layout — in other words, the design of
the plant’s interior. This sometimes caused
problems when the two sides came together
to coordinate activities.”
Siemens operates over 320 factories world-
wide, which means it has a wealth of experi-
ence in planning and construction. “Despite all
our know-how, we still had to repeatedly rein-
vent the wheel — and there was always the
danger that we’d make the same mistakes all
over again,” says Schumann. Siemens’ new planning concept has elimi-
nated this threat. The company’s planning ex-
perts intend to utilize five basic sample factory
types in the future, including facilities for wind
energy equipment manufacturing and elec-
tronics production, for example. “In Goa, we took an existing standard elec-
tronics plant design off the shelf, so to speak,
and adapted it to regional conditions and re-
quirements,” says Schumann. Among other
things, this meant taking into consideration lo-
cal building materials and technologies and
adapting building systems to suit local environ-
mental conditions.
stages. This, in turn, reduces the risk of having
to implement costly restructuring measures.” The design of a company’s footprint is the
first step in the creation of an optimized pro-
duction network. “But we also need to improve
our implementation, which is why we’ve re-
structured our on-site facility planning
process,” Kaske explains. The new concept was first applied in the
city of Goa on the west coast of India, where
Siemens Energy Automation built a new plant
for manufacturing power-grid circuit breakers
that automatically shut down network seg-
ments in order to prevent damage to the grid
or transformers. Sebastian Schumann was re-
sponsible for putting the concept into practice
in Goa. “Up until now, conventional facility
planning involved two processes that ran in
parallel,” says Schumann. “Siemens Real Estate
handled the planning of the building, while
“The entire process was managed by a sin-
gle project team — a feature that made coordi-
nation between exterior building and interior
systems planning more efficient and enabled
quicker decision making,” says Schumann. Goa
was chosen after an extensive analysis of the
location. An important aspect here was the
fact that Siemens’ Healthcare Sector already
operates a facility for manufacturing X-ray ma-
chines in Goa. As a consequence, it was possi-
ble for the new factory to utilize the existing
infrastructure. In addition, it just so happened
that Siemens already owned undeveloped
property right next to the Healthcare plant,
which greatly accelerated the planning and
construction process. Quick Construction. The facility in Goa was
completed in January 2012 — just one year af-
ter its groundbreaking ceremony. “The new
by smart stands for “simple,” “maintenance
friendly,” “affordable,” “reliable,” and “timely to
market”— and thus perfect for local and re-
gional requirements. “By manufacturing locally, our plant in Goa
not only offsets exchange rate fluctuations but
also cuts costs. Perhaps, more importantly, we
ensure that our products are adapted flexibly
to meet the different regional requirements of
our customers,” says Schumann. Just what
kind of innovative capability can be realized
when a company operates its own develop-
ment department in India is best illustrated by
the 1,200-kilovolt (kV) circuit breakers devel-
oped by the Siemens Power Transmission Divi-
sion at its facility in Aurangabad. These automated protective switches are
unique — no other comparable product can
operate at such high voltages. The unit will
help India build a 1,200-kV electricity grid
Pragmatic, cost-effective solutions are being used in emerging economies to provide basic healthcare for people in rural areas. Meanwhile, advanced medical devices are popping up as well, especially in well-equipped urban medical centers in Latin America and Southeast Asia.
The “Sanjeevan” bus offers modern healthcare to Indian villages. In Colombia, cardiologist Antonio Dager relies on high technology from Siemens (p. 29 center), as do health care providers in Chinese provinces (right). No One Left Behind
28 Pictures of the Future | Spring 2012
The scanner’s moderate price makes it pos-
sible for even small hospitals in China to adopt
computed tomography. “The SOMATOM Spirit
is usually the first CT scanner hospitals buy,”
explains Belohlavek. That’s why Siemens has
customized its syngo user interface for this
model. The device is manufactured in Shang-
hai, from which it is supplied mainly to Brazil,
Russia, India, and within China. Worldwide
sales have already exceeded 2,000 of these
scanners. Also made in Shanghai is the SO-
MATOM Emotion 6 and 16-slice CT scanner,
which many hospitals acquire as a second unit.
The unit’s fast scan time supports high patient
throughput. It also provides high image resolu-
tion so that tumors and strokes, for example,
can be diagnosed more reliably. When more advanced imaging is needed,
medical specialists in emerging economies as
well as their colleagues in industrial countries,
use high-end equipment such as the SO-
MATOM Definition Flash. This CT-Scanner can
be found mainly in large medical centers and
private clinics.
High Tech in India’s Villages. In India too
the government is striving to improve rural
healthcare. Most Indians live in one of the
country’s approximately 600,000 villages. As
in China, the penetration of health insurance
in the rural population is very low. The situa-
tion is aggravated by the fact that most physi-
cians practice in cities, and many villages are a
day’s journey away from the nearest hospital.
That’s why in 2001 Siemens developed the
concept of a mini-clinic on wheels. The idea is
to provide quality and affordable healthcare to
India’s interior. The result is the “Sanjeevan” —
a bus equipped with the most essential diag-
nostic devices, including those for X-rays, ul-
trasound, mammography, and basic lab tests,
as well as a supply of refrigerated medications.
More than 25 such buses have been sold to lo-
cal governments, NGOs, and private health-
care providers throughout India.
India is geographically subdivided into 600
districts. Siemens professionals are currently
investigating to what extent individual districts
are equipped with diagnostic devices. For ex-
H
ealthcare policies always wind up being
economic policies as well. When China
began its economic reforms two decades ago,
it rescinded its “Iron Rice Bowl” — the compre-
hensive social safety net that included job se-
curity and free medical care, and today many
rural Chinese have no health insurance and
must pay their own doctor bills.
“We thought about how to cut costs so that
everyone in China could afford to have a com-
puted tomography (CT) examination if neces-
sary,” says Florian Belohlavek, product market-
ing manager for the SOMATOM Spirit CT
scanner. The device is a part of the Siemens
SMART Initiative, which is designed to develop
economical, robust, reliable, and easy-to-oper-
ate devices particularly for use in rural areas of
developing countries. The scanner is character-
ized by a dual-slice system, which means that
one complete rotation of the X-ray tube
around the patient records two sectional im-
ages simultaneously. That’s sufficient, for ex-
ample, for essential routine examinations of
the head, lungs and spine.
The Next Economy | Healthcare
ample, they have found that some districts
have no CT systems or catheterization labora-
tories. Fewer than 200 districts have a magnet-
ic resonance imaging system (MRI).
Experts at Siemens Corporate Technology
(CT) in Bangalore are exploring how they can
contribute to the country’s rural healthcare
system. “Since the people in the countryside
have to pay the doctor themselves, they won’t
see one until it’s almost too late,” says
Manohar Kollegal, program manager for
Healthcare Products at CT. “What we need
most is better prevention and more affordable
examinations,” he adds. He and his colleagues
are developing a diagnostic device for analyses
of urine, blood, and serum, for example. “We
strive to achieve a high quality standard at rea-
sonable cost,” he explains. The prototype is to
be completed in the early summer of 2012.
Another device the Indian Corporate Tech-
nology team developed is the Fetal Heart Rate
Monitor (see Pictures of the Future,Spring
2011, p. 88) for monitoring the heart rate of a
ty rate. In Chiapas, Mexico’s poorest state,
healthcare education and delivery for the
mostly indigenous population is hampered by
language barriers and cultural differences as
well as geography that makes access difficult.
To improve on-site healthcare delivery,
Siemens has provided 44 ultrasound devices to
community health centers. The devices are
used for examining pregnant women and
small children. Since the devices were intro-
duced two years ago, infant mortality in Chia-
pas has declined by five percent.
“The Chiapas government has also pur-
chased 35 Polymobil Plus mobile X-ray units
from Siemens,” says Mauricio Valero, head of
sales for clinical products in Central America.
The units are simple to install and clean, and
their maintenance costs are low. They are used
not only in small hospitals but also in primary
care facilities, which often comprise only a sin-
gle room. In addition to these measures, the
Mexican government is also seeking to im-
prove the healthcare infrastructure of Chiapas
Patients from Central and South America as
well as the U.S. are attracted by the An-
giografía de Occidente hospital in Cali, Colom-
bia’s third-largest city. The hospital, which has
obtained JCI (Joint Commission International)
certification, is where Dr. Antonio Dager oper-
ates. Dager is the only cardiologist in Colombia
who is qualified to use a new minimally inva-
sive procedure to replace heart valves. Dr. Dager, who received training in the U.S.,
uses two Artis Zee angiography systems plus
syngo DynaCT Cardiac software, which pro-
vides him with 3D images from the body’s inte-
rior during the procedure. Over the past three
years Dager has performed 90 such proce-
dures. He is now equipping a hybrid laboratory
in which he will be able to perform both mini-
mally invasive and open heart procedures. “In
order to plan this lab, I visited Siemens in Er-
langen last year, where I learned all I needed to
know about the required infrastructure. I was
able to actually practice all the steps of the pro-
cedure in a hybrid lab,” he reports.
Pictures of the Future | Spring 2012 29
fetus. The device not only measures the fetal
heart rate via a sort of microphone but also the
mother’s uterine contractions. Having com-
pleted its clinical trials in 2011, it is now ready
for clinical use in India, and is expected to help
reduce India’s high infant mortality. “We have
developed proprietary algorithms for our soft-
ware and incorporated region-specific diag-
nostic alarms regarding the fetal heart rate,”
Kollegal explains.
More advanced solutions, this time in the
area of artificial Intelligence, are being imple-
mented at locations throughout Siemens. For
example, researchers in the United States and
Germany are developing a clinical decision
support system that analyzes patient data and
suggests the most likely diagnosis to the at-
tending physician (see Pictures of the Future,
Fall 2011, p. 60). The system is being devel-
oped by Dr. Vinay Shet and his team within the
Collective Intelligence lighthouse project.
Ultrasound in Mexico. India is by no means
the only country to have a high infant mortali-
by building three new hospitals in urban cen-
ters. As a part of its breast cancer screening
program, the government has equipped two
first-level private clinics in Mexico City and
Monterrey with a digital mammography sys-
tem and an ultrasound device for automatic
3D breast scans (see Pictures of the Future,Fall
2008, p. 95). The combination of ultra-
sound and mammography is
considered the best method for
detecting breast cancer and
avoiding false positives and su-
perfluous biopsies. The govern-
ment plans to install another six
to ten such devices in smaller cities. And it is
planning to have the medical images from
such screenings interpreted centrally by two or
three highly specialized experts in Tuxtla, the
capital city of the State of Chiapas. The images
will be transmitted to these experts via data
links. “The installation of the required telemat-
ics infrastructure is slated to be completed in
18 to 24 months,” says Valero.
China, India, Mexico and Colombia — these
examples illustrate that high-end medical care
is making progress not only in developed coun-
tries, but in emerging economies as well. De-
spite their economic advances, these countries
need to pay as much attention to cost factors
as do industrialized countries. But the challenges in providing healthcare
to rural populations — often in relatively inac-
cessible areas — are disproportionately large.
Nonetheless, many developing countries man-
age to use a practical mix of moderate-cost so-
lutions for basic medical care delivery in rural
areas plus high-end solutions for specialized
care in large cities to improve the health of
their citizens.Michael Lang
A mobile clinic fitted with high-tech
equipment provides healthcare in
the Indian hinterland.
Russia is seeking to expand domestic research and production. New Siemens research projects covering power generation and transmission, rail systems, and the refinement of particle accelerators will help to modernize the Russian economy over the next few years.
A researcher using a microscope to study samples
of steel for transformers. Siemens is investing substantially in Russia, for example in joint projects to develop new and better materials. Modernizing a Major Economy
(IfW). “Russia’s entry into the World Trade Or-
ganization (WTO) in the fall of 2011 sent a sig-
nal that foreign investors can count on legal
guarantees and the protection of their intellec-
tual property rights in the country.”
In the energy sector, Russia is looking to
modernize and expand its existing outdated
power plants. A total of 140 new power plant
blocks with a combined capacity of 26 gi-
gawatts (GW) are to be built between now and
2017. Many of these will be efficient com-
bined-cycle power plants, which are becoming
more and more important for the entire Com-
monwealth of Independent States (CIS). “Facili-
ties equipped with gas turbines currently ac-
count for only around 30 GW of the total
installed capacity of 370 GW in CIS member
states,” says Dr. Roland Fischer, CEO of the Fos-
sil Power Generation Division in Siemens’ Ener-
gy Sector. “However, we estimate that their
share of output will rise to 100 GW by 2020.”
Siemens has been active in Russia for 160
years, and the company is now planning to in-
vest €1 billion in the country and create 4,000
new skilled jobs over the next three years. A to-
tal of €700 million will be invested in Russia’s
energy sector alone, €400 million of which will
be earmarked for the expansion of service op-
erations and new facilities that manufacture
efficient gas turbines. “We’re investing around
€275 million in a new gas turbine manufactur-
ing facility in St. Petersburg, where we will
start building state-of-the-art products in
2014,” says Dr. Michael Süß, member of the
Siemens Managing Board and CEO of Siemens’
Energy Sector. The new facility will handle not only pro-
duction, service, and sales but also research
and development. Demand for high-voltage
components is also increasing in line with Rus-
sia’s expansion and modernization of its power
grid. Siemens has invested roughly €5 million
in a plant for manufacturing high-voltage pow-
er switches and circuit-breaker switches for the
110 and 220 kilovoltage levels in Voronezh,
which is located around 500 kilometers south
of Moscow. The facility will have an annual
production capacity of 500 switches.
Fast Falcon. Siemens regards Russia as a
strategic growth market for rail systems tech-
nology. The company has delivered several
high-speed trains for the Moscow-St. Peters-
burg line. These “Sapsan” (falcon) trains have
R
ussia occupies a special place among the
BRIC countries — the dynamic markets of
Brazil, Russia, India, and China. Whereas the
economies of China, India, and Brazil are grow-
ing fast, Russia is only slowly coming back
from the economic crisis, with progress being
inhibited mainly by significantly reduced raw
materials prices. “An influx of foreign invest-
ment is crucial for the modernization of the
Russian economy,” says Prof. Rolf Langhammer
from the Kiel Institute for the World Economy
The Next Economy | Russia
Pictures of the Future | Spring 2012 30
South-south cooperation benefits developing and emerging
countries alike. Siemens India helped Siemens Kenya build
a biomass power plant in Uganda in just such a project.
Sugar cane residues serve as fuel for a steam power plant. Projects like this are helping to boost Uganda’s electricity supply. Sweet Partnership
30 Pictures of the Future | Spring 2012
ous problems in 2006 when water levels in
Lake Victoria, Africa’s largest freshwater lake,
reached their lowest level in 50 years. This not
only threatened fishermen, but also severely
affected Uganda’s industry (see Pictures of the
Future,Spring 2009, p. 92).
Power from Sugar Cane. Given these cir-
cumstances, the Ugandan government devel-
oped an energy strategy including biomass-
based co-generation plants that could
simultaneously generate electricity as well as
heat for manufacturing processes. The Kakira
Sugar Works (KSW), Uganda’s leading sugar
company, is an example of such a project (see
Pictures of the Future,Fall 2010, p. 41). KSW is
located 15 kilometers from Jinja, a town of ap-
proximately 90,000 on the shores of Lake Vic-
toria. ”KSW was crushing 3,500 tons of sugar
cane per day (TCD), but wanted to expand to
6,000 TCD,” says Rani Sodhi, a project manager
from Siemens India. To meet this goal, cane
residue left after crushing, known as bagasse,
would have to be burned in boilers, producing
high-pressure steam that could be used to
drive the factory’s cane mills and produce elec-
tric power. “To achieve this, we worked with experts
from Siemens India and Kenya,” says Ganeson
Sundararaman, an electrical engineering man-
ager at KSW. “We had great confidence in the
strength of Indian project management be-
cause of similar projects executed by Siemens
India at home. In many ways it’s easier for us
to partner with those who have faced similar
challenges. Countries with comparable devel-
opment patterns understand our issues and in-
spire us. Take India — 30 years ago it was an
agricultural economy, but for the past two
decades it has experienced double-digit annu-
al growth.” Not surprisingly, India has become a major
player in Africa. At the 2011 India-Africa Sum-
mit, the Indian government announced several
new initiatives, including a program to grant
scholarships to 22,000 African students, ef-
forts to promote Africa’s infrastructure devel-
opment, and plans to invest $700 million to
build institutions such as the India-Africa Insti-
tute of Information Technology in Ghana.
All of this is a vivid example of south-south
cooperation (SSC), a term that was first pro-
moted in the 1960s, when a group of 77 devel-
oping countries formed a loose coalition to
pursue joint economic interests and increase
the group’s collective political influence. Today
SSC is a colorful mosaic of instruments includ-
ing debt relief and trade agreements as well as
the exchange of know-how.
The “Kakira partnership” combined the ex-
pertise of Siemens teams from India and
Kenya. “Our aim was to design the whole co-
generation project and supervise the project’s
execution,” says Sodhi. “Siemens Kenya was
mainly in charge of the installation of the pow-
er plant and on-site coordination. Five team
members from India frequently traveled to
Kakira and were in constant contact with our
colleagues in Kenya.” The co-generation plant
has helped KSW to become self-sufficient and
to feed 14 MW into Uganda’s national grid
through a newly constructed power line. KSW
is now planning to double its capacity to
12,000 TCD and increase its grid electricity ca-
pacity to 32 MW by July 2012. In addition to
these benefits, the Kakira expansion reduces
carbon emissions by generating electricity
from renewable resources and increases cane
cultivation by farmers, thus generating income
in remote areas. However you look at it, the
Siemens south-south cooperation has been a
sweet success — and a model for future joint
efforts.Hülya Dagli / Bijesh Kamath
T
he morning quiet is broken, warm sun-
shine embraces the wooded mountains,
and barefoot children collect firewood be-
tween wooden huts. Uganda’s national an-
them, “Oh Uganda, Land of Beauty,” is no ex-
aggeration within the natural beauty
surrounding Mount Elgon, an extinct volcano
that straddles the Ugandan-Kenyan border. But
when night falls, the beauty is covered by deep
darkness. The reason: Africa’s “green pearl” is
suffering from a severe power shortage.
According to Uganda’s National Environ-
ment Management Authority, more than 90
percent of the country’s population does not
have access to electricity. The present peak de-
mand is approximately 400 megawatts (MW).
Canada, with a population almost the same
size as that of Uganda, has a peak demand
that’s 250 times higher. Uganda depends on
hydroelectricity for more than three quarters
of its total power generation. This created seri-
The Next Economy | Exporting Know-How
Pictures of the Future | Spring 2012 33
To maintain their reputations as attractive employers in the years to come, companies will have to offer employees a work environment that is health oriented. Flexibility and balanced
integration of work and private life are increasingly becoming quality criteria.
A forward-looking corporate culture supports workers of all age groups and promotes flexible, autonomous work models and the health of employees.
A New Spin on Work
The Next Economy | Job Satisfaction
resulting loss in output equals €364 billion —
almost one sixth of Germany’s gross domestic
product.
“Burnout is a chronic fatigue syndrome, of-
ten associated with depression,” says Dr. Ulrich
Birner, who is responsible for matters related
to psychological health at Siemens. It is caused
by being overburdened for an extended period
and a lack of a healthy balance, whereby re-
sponse to strain varies from person to person.
“Everyone needs exertion to stay healthy. Just
as I need an incentive when practicing some
type of athletic activity. The modification and
dosage are all that matters,” explains Birner. Companies around the world are testing
various approaches to help prevent burnout.
For example, pharmaceuticals manufacturer
Merck is hiding the “Reply to All” button in e-
mails so that employees will stop clicking it re-
flexively and thus needlessly overloading other
employees’ inboxes. Intel has introduced “Zero
E-Mail Friday,” and consumer goods firm
Henkel sometimes even sends managers to a
monastery to help them manage stress. An Issue for the CEO. “Physical exercise, sem-
inars, and counseling are part of our corporate
health management repertoire at Siemens
too,” says Birner. But stand-alone offerings
aren’t enough — to achieve a healthy corpo-
rate culture they must be connected and com-
plemented in sensible ways. This means the
A
n Oscar, Golden Globes, a star on the Hol-
lywood Walk of Fame — Renée Zellweger
has been showered with the highest honors of
the media world. What more could an actress
achieve? In 2009, though, she needed a one-
year timeout due to total exhaustion. Hers isn’t
a rare or isolated case in the celebrity world.
But it isn’t just stars who sometimes lose inter-
est in their work, at least for a time, and have
to take a break from the rat race. According to
the Hamburg-based Fürstenberg Institute,
which provides corporate health management
services, 84 percent of workers in Germany felt
that workplace conditions were putting them
under strain in 2011. Think tank Hamburgis-
ches WeltWirtschaftsInstitut estimates that the
31 Pictures of the Future | Spring 2012
for heavy ion research in Darmstadt, Germany,
and the Institute for Theoretical and Experi-
mental Physics (ITEP) in Moscow on the devel-
opment and production of a radio-frequency
high-performance generator for linear particle
accelerators. The generator, which will use silicon car-
bide-based semiconductors invented by a CT
research team headed by Dr. Oliver Held, will
be the key component in the development of
powerful linear accelerators that will be much
smaller and more compact than current mod-
els. The scientists involved in the project hope
they can build facilities that are around four
times smaller than current facilities, which
sometimes need to be 100 meters long. The
new technology is also expected to have an
efficiency rating above 70 percent in compari-
son to an efficiency of 40 to 50 percent for cur-
rent solutions such as klystrons, magnetrons,
and traveling wave tubes. Such devices will be
configured as stand-alone solutions, i.e. as a
replacement for a klystron, or as integrated so-
lutions, where they are part of the accelerating
structure itself.
The first modules with silicon carbide tran-
sistors based on CT technology have an output
of up to three kilowatts and have already been
developed and tested. Even more powerful
transistors are now being planned, and con-
cepts have been developed for combining
several dozen radio-frequency modules to
form a three-megawatt generator. These types
of radio-frequency generators can be used for
scientific experiments and in industrial applica-
tions.
Research projects like these are very much
in tune with the Russian government’s strategy
of developing the country’s innovative strength.
The improved integration of education, sci-
ence, and industrial applications is meant to
create a national innovation system that
will generate new momentum for Russia’s
sustainable economic growth.Sylvia Trage
volipetsk Steel (NLMK). The objective is to
work together on research in the areas of met-
al production optimization, materials quality,
and production automation. Novolipetsk Steel
is one of the few companies in the world that
can produce electrical steel for transformers,
and it is looking to become a qualified supplier
of transformer steel for Siemens. This will re-
quire various kinds of know-how — for exam-
ple, expertise in manufacturing the type of
transformer alloy that prevents the buzzing
noise common at substations. The microstruc-
tures of associated materials will also be fine
tuned, as these can be influenced by tempera-
ture, the degree of deformation involved, and
chemical compositions. “In addition to steel production
equipment, NLMK also needs au-
tomation systems from Siemens
for the control of production
processes,” says Denis Saraev,
who is responsible for the High-
performance Metals and Alloys
technology field at Siemens. “On
the other hand, we’re also NLMK’s potential
customer for steel that can be used for manu-
facturing transformers and electric motors.”
Saraev also manages this special partnership
with NLMK. Accelerated Research. Siemens is also the
first German company to enter into a strategic
partnership with the initiators of the future in-
novation city of Skolkovo (see Pictures of the
Future,Spring 2011, p. 74). Siemens plans to
invest €40 million in an R&D center there. One
of the major research projects at the site will
involve the further development of particle
accelerators. “The Russians are experts in re-
search in this area,” says Dr. Martin Gitsels,
who manages CT in Russia.
Siemens is working with the Budker Insti-
tute of Nuclear Physics in Novosibirsk, the Uni-
versity of Frankfurt, the GSI Helm holtz center
been adapted to handle the special climatic
conditions of this region (see Pictures of the
Future,Spring 2010, p. 81; Fall 2010, p. 10).
For example, they need to remain fully opera-
tional at temperatures as low as -40 degrees
Celsius (°C); safety-related systems have to
withstand a temperature of -50 °C. If an on-
board network fails, the train can be supplied
with heat directly from overhead power lines. Siemens engineers have also developed a
special procedure for checking the durability of
train wheels and analyzing the resulting data
in order to find the appropriate wheel profile;
and they have altered the trains’ undercar-
riages to avoid the aggregation of ice and
snow. Russian Railways has announced plans
to invest almost €300 billion in the rail system
network between now and 2030. In this peri-
od, it plans to commission 23,000 new loco-
motives and 24,000 new regional trains. In
2011 Siemens and Russian rail technology
company Sinara established a Train Technolo-
gies joint venture for local production of re-
gional trains in Yekaterinburg. The new com-
pany has already received orders worth more
than €3 billion for freight locomotives and re-
gional trains, such as the Desiro RUS. Several
hundred million euros are being invested in
the expansion of local production capacity.
Taking the Buzz out of Transformers. But
Siemens plans to do more in Russia that just
manufacturing; it also plans to extend its re-
search activities there. In June 2010 Siemens
signed an agreement with the Engineering
Center of Russian steel manufacturer No-
Together with its partners, Siemens
plans to invest €1 billion in Russia
over the next three years.
Research is being conducted in Russia on generators for reclaiming heat (left), particle accelerators (center), and 3D scanners for the accelerators’ components (right). Pictures of the Future | Spring 2012 35
The work done by many of our staff members
requires a communicative environment.” This is where the new open-plan “Siemens
Office” comes into play. In the future, open-
plan offices should serve to encourage com-
munication all over the world. Employees, de-
pending on their needs, will select the right
workplace for themselves in quiet areas or dis-
cussion zones. “The mobile office promotes
work-life integration through the additional
freedom it provides. Sabbaticals and part-time
work agreements also help employees to rec-
oncile family and job,” says d’Huc. “In this con-
text, we also want to offer about 2,000 day-
care spots in Germany by 2015.” (Pictures of
the Future,Spring 2011, p. 106; Fall 2011, pp.
18, 28). The prerequisite for so much freedom
and flexibility is a management culture that
works on the basis of objectives and relies on
trust, and less on presence in the office. But the aim is to make everyone comfort-
able — not just Generation Y. “There’s a lot to
learn from experienced co-workers; we don’t
want to lose them,” d’Huc says. In 2009, with
this in mind, the Energy sector formed a “Fu-
ture Retirees Resource Group” in Orlando, Flori-
da. There are currently 200 members. The ob-
jective is to prepare older employees for their
retirement and establish links with them for
the period after Siemens. “Then they become
mentors and give seminars,” says d’Huc. The
company’s “Generations Employee Network
(GENe)” takes a similar approach. “With sup-
port from our Diversity department, employ-
ees are building an inter-generational network
for co-workers from the Erlangen, Nuremberg,
and Forchheim area in Germany,” says d’Huc.
In the future, members of different genera-
tions will network there, learn from one anoth-
er, and work together.
Michelle Obama and Siemens employee Jackie Bray stood side by side (right) during Barack Obama’s State of the Union speech.
Demographic change has additional conse-
quences, however: “Skilled workers are becom-
ing harder to find, so there’s a growing need to
adapt the work environment to employees’
changing needs,” says d’Huc. “Classic job situa-
tions — 20 years, fixed working times, no
more than one boss — are increasingly giving
way to a flexible work envi-
ronment.” The same applies to boom-
ing countries like Brazil, Rus-
sia, India, and China. “In these
countries, Siemens should
have up to 60 percent more
local talent in research in the
future. But international companies are no
longer automatically the first choice in these
countries; domestic firms are becoming more
and more attractive employers,” says d’Huc.
There’s often high turnover in these countries,
too, which leads to an annual hiring rate of 20
to 40 percent. But the struggle to win over the
best and the brightest is underway. In 2011
Siemens launched an ambassador program
covering six countries in the ASEAN-Pacific
area. The program calls for commercial direc-
tors and sales managers to become ambassa-
dors of the company and take part in an active
exchange with students at partner universities. Investing in People. With roughly 10,000 ap-
prentices and students combining academic
instruction with on-the-job training, Siemens is
one of the biggest providers of vocational in-
struction in Germany. Initiatives such as the
Siemens Graduate Program, with 1,900 partic-
ipants worldwide, are now also taking effect in
Egypt, Saudi Arabia, China, and India. “This
program is very attractive for university gradu-
ates because of its variety of duties and sub-
jects,” says d’Huc. The option of combining
study with training at Siemens is also quite
popular internationally, whether the academic
program is in a technical or commercial field or
in computer science. For a three-year period,
the student attends lectures and takes part in
training and practical segments at Siemens
that prepare trainees for specific jobs at the
company. In the past, combining study and
training at Siemens was an option reserved
only for young graduates from Germany, but in
late 2011 the company officially opened a gas
turbine factory in Charlotte, North Carolina
(U.S.) and simultaneously set up a partnership
there with Central Piedmont Community Col-
lege. In the future, skilled production workers
will be trained here — with courses in laser
and robot technologies, for example — with
Siemens covering the tuition. The Siemens initiative impressed U.S. Presi-
dent Barack Obama so much that in his State
of the Union address in late January 2012 he
cited this work-study combination as a model
for creating new jobs. “I want every American
looking for work to have the same opportunity
as Jackie did,” said Obama, referring to Jackie
Bray, a single mother. After being laid off from
her job as a mechanic, she found a new posi-
tion in the Siemens gas turbine plant — and
the company invested in her by paying for her
advanced training at Central Piedmont Com-
munity College Hülya Dagli
“The world of work is becoming
more flexible and needs new com-
munication and work models.”
management is being supported by a module
on “Health-Conscious Management” that has
been added to all manager training sessions
and special management health programs.
“Thanks to this approach managers can learn
how to adapt to everyday processes, often
with only modest effort, so that their teams
can work in an atmosphere that is more con-
ducive to good health,” says Franke. To put it
plainly, he adds, “When either workplaces or
large projects are planned, consideration
should be given not just to technical, business-
related, environmental, and safety issues, but
also to subjects such as a healthy workplace,
psychological health, encouragement of physi-
cal activity, healthy diet, and medical care.”
Right from the start, for example, there should
be efforts to ensure that workstations are
properly designed, that teamwork is character-
ized by mutual support, and that managers are
adequately trained to recognize excessive
strain and respond to employees appropriately.
Life after Siemens. “It’s becoming harder and
harder to keep employees’ work lives and pri-
vate lives separate,” says Maximilian d’Huc, a
strategist at Siemens Corporate Human Re-
sources. “The work world is becoming more
flexible, and it requires new models of commu-
nication and work.” For example, some em-
ployees from the younger “Generation Y” —
which made up 68 percent of new Siemens
hires worldwide in 2011 (see graphic at left)
— want to pick their children up from the day-
care center at lunchtime and continue working
from home. “Why not?” asks d’Huc. After all,
you don’t rate a player by the total distance he
runs on the soccer field but rather by the num-
ber of goals he scores during the game. “But
there has to be the right balance, of course.
34 Pictures of the Future | Spring 2012
approach must be deeply rooted. “Siemens is
one of many companies that have formulated
sustainability goals in recent years in order to
live up to their social responsibility while also
staying successful in business,” says Dr. Ralf
Franke, who is responsible for environmental
protection, health management, and work
safety at Siemens. “In addition to environmen-
tal issues, the social aspect is now becoming
increasingly important.” In 2009 Siemens
therefore brought these issues together in an
Environmental Protection, Health Manage-
ment and Safety unit, which has the authority
to establish company-wide guidelines. The
unit also defines binding standards, responsi-
bilities, and processes.
“We’re now introducing a health manage-
ment system that will enable the company to
systematically promote its employees’ health
at workplaces around the world, above and be-
yond what’s required by law,” says Franke, who
adds that this is new in terms of international
standards. “This is an issue for the attention of
the CEO, not just the chief medical officer. Af-
ter all, any department is only as capable as its
employees. So creating conditions that pro-
mote good health is a management responsi-
bility.” Department heads are supported by a
professional, company-wide health manage-
ment organization and by standards that apply
to all business units and organizations. But first, managers themselves have to be
made more aware of the issue. With this in
mind, the introduction of systematic health
In late 2011 Siemens inaugurated a new gas turbine plant in Charlotte, North Carolina.
More than two thirds of new hires and a third of
Siemens employees belong to Generation Y
68% of new hires (in total 74,000
new hires in fiscal year 2011)
10% of new hires
22%
of new hires
Generation X
33%
of employees
Baby boomers
31%
of employees
Traditionalists
1%
of employees
Generation Y
35%
of employees
Traditionalists
1925–1945
“Work is doing your
duty”
Indirect communication
preferred: via telephone,
e-mail, or letters
Baby boomers
1946–1964
“Live to work”
Personal, direct commu-
nication, use of social
networks like Facebook
and Twitter. Public and
private matters kept
separate.
Generation X
1965–1976
“Work to live”
Personal, direct commu-
nication, can always be
reached via laptop or
smart phone. Division
between private and
public life is blurred in
social media.
Generation Y
1977–2000
“Personal matters and work life are interwoven”
Active in social net-
works, private and pub-
lic matters are mixed,
use of smart phones to
post updates and send
messages.
Born in
Characteristic attitudes
Communication
behavior
Source: Harvard Business Manager (July 2010) and Siemens Corporate Human Resources (September 2011)
Siemens brings together four generations with different lifestyles and communication habits. reason why in 2011 one of the most modern
hospitals in Moscow, the Perinatal Medical
Centre, awarded Siemens a contract to up-
grade not only its computer and magnetic res-
onance tomography hardware but also its im-
aging software. While Siemens Healthcare is
handling the medical technology, SFS Russia is
taking care of the financing.
Whether it’s a major infrastructure project
such as a power plant or an airport, or the
modernization of industrial facilities and hospi-
tals, Siemens Financial Services and its financ-
ing concepts are helping to drive develop-
ments not only in established markets, but in
emerging ones. For example, SFS has estab-
lished a financial services company in India
that will help private companies and public in-
vestors finance projects by various Siemens
sectors. Katrin Nikolaus
Siemens Financial Services knows how investments can be put to profitable use — even in a crisis. SFS safely guides large
projects through volatile financial markets all over the world.
A Siemens combined-cycle plant in Belgium......where the company has an equity in T-Power. C
ompanies that want to implement major
infrastructure projects such as power
plants, airports, or hospitals need steady
nerves — not to mention solid financing and
completely reliable partners. For example, the
planning process for a T-Power combined-cycle
(gas and steam) power plant in Belgium began
back in 2005 with the establishment of a new
project company jointly owned by Siemens Fi-
nancial Services (SFS), the Belgian firm
Tessenderlo Chemie, and a project develop-
ment company. A consortium of ten banks
handled the remainder of the financing, and
the new joint venture received the first private
power generation license ever issued by the
Belgian government. But in spite of its strong backing, the project
encountered headwinds. “Just as construction
was getting started the global financial crisis
broke out,” recalls Hans-Joachim Schulz from
the SFS Project & Structured Finance Energy
unit. Nevertheless, construction proceeded
without delay and none of the project or fi-
nancing partners jumped ship. The reason, as
Schulz explains, was that “we were in the right
place at the right time because Belgium’s gov-
ernment wanted to increase competition in
the power-generation sector.” Just as impor-
tant was the fact that Siemens had entered the
power plant in Irsching, Germany, which was
developed and built by Siemens. Says Head of
Gas Turbine Product Management Willibald Fis-
cher: “Insurance for such a project is vital. In
addition to normal risks, such as failure to
meet deadlines and construction accidents, in-
novative technology also has to be insured. It
was the early involvement of SFS that made in-
surance coverage for our project possible.” Siemens also helps partner companies fi-
nance machinery. For example, SFS’s acquisi-
tion of the Vladivostok-based financial compa-
ny DeltaLeasing gave it a nationwide network
with 15 offices. One of those offices is located
in Samara, Russia’s third-largest industrial cen-
ter. Here, ServiceMontageIntegratsiya (SMI),
whose headquarters is located in Kazan, has
leased new machines and units for metal pro-
cessing from Siemens Finance Russia worth
€1.36 million.
“Companies in Russia are increasingly de-
manding good service from experienced finan-
cial partners,” says Oleg Rakitsky, Head of SFS’
Commercial Finance unit in Russia. That’s one
36 Pictures of the Future | Spring 2012
€440 million project with 33 percent of the eq-
uity capital. “We’ve been working on develop-
ment projects for over 20 years with interna-
tional partners and have gained a reputation
as being absolutely reliable,” says Schulz.
The 430-megawatt combined-cycle plant
entered service on schedule in July 2011. With
an efficiency level of over 58 percent, it is one
of Europe’s most modern and efficient facili-
ties. Siemens Energy was responsible for con-
struction and supplied the main components,
including a gas turbine, a steam turbine, and a
generator. Tessenderlo uses about half of the
electricity generated for energy-intensive man-
ufacturing processes in its neighboring plant;
the rest is fed into the power grid.
“The T-Power plant offers a perfect example
of how Siemens Financial Services handles
large-scale infrastructure projects that involve
joint ventures,” says Schulz. SFS always works
with reliable local partners to ensure that con-
ditions and requirements such as approval pro-
cedures and the participation of neighboring
communities are taken into account in the
planning process. This is also the case with the Lincs offshore
wind farm now under construction off the
eastern coast of the UK (see Pictures of the Fu-
ture,Spring 2010, p. 81). Siemens is serving as
Future,Fall 2009, p. 60). The city of Berlin pays
for the upgrades in installments with its con-
tractually guaranteed savings. As a result of
these steps, many buildings have been
equipped with new heating systems, ventila-
tion and air conditioning units, and centralized
building management systems. And Berlin is no exception. In similar proj-
ects, Siemens has upgraded 4,500 buildings
worldwide. As a result, operators have saved
more than €1 billion and CO
2
emissions have
been cut by 9.7 million tons.
In addition, SFS takes care of managing in-
surable risks — among others, those associat-
ed with new technologies that insurance com-
panies are willing to underwrite only to a
limited extent. For example, SFS has engi-
neered an insurance concept for the world’s
most powerful gas turbine in a combined-cycle
Profitable Projects
The Next Economy | Financing Pictures of the Future | Spring 2012 37
a financing partner in this project as well — in
addition to supplying wind turbines and grid
connection technologies. “In projects of this
scope, we work with our partners for years,”
says Schulz. Siemens is often connected to a
project over the long term through service and
maintenance contracts. Modernizing and Saving. Siemens is also
committed to the long haul when it comes to
financing energy system modernization proj-
ects. Office buildings, hospitals, schools, and
universities frequently suffer from investment
logjams when it comes to state-of-the-art
building systems. With this in mind, in 1996
the city of Berlin established a partnership with
Siemens to upgrade the energy efficiency of
around 200 public buildings. Instead of de-
pending on new funding, the project was fi-
nanced through the use of energy perform-
ance contracting. Here, Siemens identified the
savings potential associated with energy and
building operation costs and implemented
modernization measures (see Pictures of the
The Next Economy
In Brief
The global economy is being transformed and
making new success stories possible. In many in-
dustrial sectors, for example, future growth will
take place predominantly in emerging markets.
Siemens‘ Second Wave Emerging Countries con-
cept recognizes the increasing importance of
countries such as Colombia, Mexico, and Turkey,
where new assembly plants are being built and
new products are being developed according to
the needs of local markets. In the future, industri-
alized nations will have to be even more innova-
tive. They will require the best-educated and
most talented people, who will be highly sought
after. (pp. 10, 20, 33)
”One thing that successful emerging markets
do well is establishing conditions in which
modern manufacturing flourishes,” says Dani
Rodrik, a professor at Harvard University, in an
interview. (p. 15) The face of Latin America is changing. Nations
such as Brazil and Colombia are switching from
supplying raw materials to manufacturing high-
tech products. Siemens is expanding its involve-
ment in these countries. Factories for capacitors
and X-ray machines in Brazil and plants for build-
ing electric motors in Colombia are just some of
the success stories here. (p. 16)
As a consequence of worldwide production
networks, every company that is active globally
has a “global manufacturing footprint” that has to
be considered in strategic planning, alongside
such key success factors as profitability and
speed. In order to optimize the process of build-
ing new production facilities, Siemens has devel-
oped a new planning concept, which will be ap-
plied for the first time in Goa, India. (p. 26)
In coming years Siemens will contribute to the
modernization of Russia with investments in en-
ergy and railroad technology as well as research
and development. (p. 31)
Power plants, airports, and hospitals are exam-
ples of projects that require solid financial back-
ing, especially in times of crisis. Gas and steam
turbine power stations and renovations to im-
prove energy efficiency are examples of where
Siemens Financial Services has provided depend-
able financing concepts. (p. 36)
PEOPLE:
Second Wave Emerging Countries: Marianne Kiener
, Corporate Development Strategy
marianne.kiener@siemens.com
Latin America:
Tamy
res Machado, Technical Director in Jundiaí
tamyres.machado@siemens.com
Wilson Ruiz, Distribution Diesel Motors Colombia
wilson.ruiz@siemens.com
Mexico, Light for Everyone Project: José Hernández, Project Leader Siemens Mexico
jose.hernandez@siemens.com
Turkey, Water Purification:
Ersoy Bulutlar, Siemens Water Technologies Turkey
ersoy.bulutlar@siemens.com
Global Logistics Chains:
Martin Bellhäuser, Siemens Supply Chain martin.bellhäuser@siemens.com
Global Production Networks:
Jörg-Henning Kaske, Siemens Supply Chain
joerg-henning.kaske@siemens.com
Healthcare in Emerging Markets:
Florian Belohlavek, Siemens Healthcare
florian.belohlavek@siemens.com
Manohar Kollegal, Corporate Technology India
manohar.kollegal@siemens.com
South-South-Cooperation India-Kenya-Uganda:
Rani Sodhi, Project Leader Siemens India
rani.sodhi@siemens.com
Russia: Dr. Martin Gitsels, Corporate Technology Russia
martin.gitsels@siemens.com
Dr. Hans-Joerg Grundmann, Siemens Rail Systems
hans-joerg.grundmann@siemens.com
Working Environments / Work-Life Integration:
Dr. Ulrich Birner, Siemens EHS
ulrich.birner@siemens.com
Maximilian d’Huc, Siemens Human Relations
maximilian.dhuc@siemens.com
Financing Infrastructure Projects:
Hans-Joachim Schulz, Siemens Financial Services
hans-joachim.schulz@siemens.com
Interview —Prof. Dani Rodrik:
dani.rodrik@havard.edu
LINKS:
Rodrik: www
.hks.harvard.edu/fs/drodrik
Pricewat
erhouseCoopers: www.pwc.com
United Nations Development Program, Special Unit for South-South Cooperation:
http://ssc.undp.org/content/ssc.html
Pictures of the Future | Spring 2012 3938 Pictures of the Future | Spring 2012
B
ig conferences, far-reaching goals, but few
concrete results — ever since the Climate
Change Conference in Durban, South Africa, in
December 2011, many skeptics have increas-
ingly been asking whether big international
summits really are the right means for making
the world more sustainable. How can the next
big event of this kind, Rio+20, be successful?
Following protracted negotiations, the par-
ticipants of the Durban conference drew up a
road map for a global climate change treaty,
which won’t go into effect until 2020. What’s
more, it’s not yet certain whether the main
emitters of greenhouse gases, China, the U.S.,
Russia, and India, will even sign the treaty. The
summit’s structural weaknesses also became
apparent. Young people, whose future was be-
ing negotiated in Durban, were hardly involved
in the decision-making process.
Because today’s young people will shape
the world of tomorrow, Siemens has created a
community called “Future Influencers” in order
to encourage them to take the future into their
own hands. The community encompasses
about 30 young people from around the globe
who are sharing their ideas on how to increase
sustainability. Among them is Rashiq Fataar,
24, from Cape Town. Fataar, who works for an
insurance company, writes about sustainability
in his home town on the FutureCapeTown
blog. One of the questions he asks on the blog
is “Does a building really deserve a sustainabili-
ty rating if it boasts ultramodern and energy-
efficient air conditioning and lighting systems
but is nearly impossible to reach by public
transportation?” Even though Fataar thinks that the confer-
ence in Durban did not accomplish enough, he
expects Rio+20 to produce concrete results.
“Those who are responsible won’t approach
the issues as naively as they did in the past and
wait for countries to act of their own accord.
Instead, they will demand that communities
commit themselves to sustainable measures,”
he predicts. Fataar adds that nations have ac-
cumulated a lot of experience on how to make
urban living more environmentally responsible
and climate-friendly. Such best practices are
also documented in the Siemens Green City In-
dexes for Germany, Europe, the United States
and Canada, Asia, Latin America, and Africa
(Pictures of the Future, Fall 2011, pages 7 and
8, and Spring 2010, p. 9). An overview of re-
sults will be presented at Rio+20.
Obvious Solutions. In many areas, huge
amounts of energy could be saved with very little
effort. For example, during the summit in Durban
the conference tents were air-conditioned but
the entrances were wide open, thus letting the
heat back in. Many participants felt this was sym-
bolic of the overall situation, in which obvious so-
lutions are not consistently exploited. This applies
to the use of renewable energy sources, highly
efficient power plants, and better energy utiliza-
tion in industry, buildings, and transportation sys-
tems.
Klaus Töpfer, an environmentally oriented
politician who is Founding Director of the Insti-
tute for Advanced Sustainability Studies in Pots-
dam, believes that environmentally-friendly
growth is achievable. Instead of issuing dire
warnings, he says we need to convince countries
of the benefits of sustainable development. “You
can achieve independence from price fluctua-
tions and shortages of fossil fuels by harnessing
your own resources, such as geothermal energy
in Kenya. These innovations will allow such coun-
tries to achieve energy independence, accelerate
their national economic development, and have
a positive impact on the climate,” Töpfer said in
an interview with the German news magazine
Der Spiegel.
But reality on the ground is often quite differ-
ent. Nigeria’s capital city, Abuja, for instance, is
blanketed by thick exhaust fumes and, as is often
the case, it suffers from regular blackouts. In re-
sponse, diesel generators are used to produce
electricity. In Nigeria alone, 60 million people
need to regularly use such machines. Hopes are
therefore high that renewable sources of energy
will be able to replace inefficient, expensive, and
environmentally-harmful energy sources. Phenias Sadondo, a 25-year-old student, be-
lieves solar energy is the key to progress in Africa.
Sadondo is a volunteer at Action 24, a youth or-
ganization that runs projects to combat the ef-
fects of climate change in his home country, Zim-
babwe. “Two thirds of Africa’s economy is
dependent on agriculture. That’s why climate
change poses an immediate threat to us,” ex-
plains Sadondo, who drew attention in Durban to
the challenges facing his generation.
Fighting Climate Change and Poverty. Two
of the key topics to be addressed at Rio+20 are
environmental protection and the fight against
poverty. An Action 24 project in Norton, a
town located about 40 kilometers west of
Harare, Zimbabwe, demonstrates how to make
progress in these areas. “We have set up a farm
there for environmentally-friendly mushroom
cultivation and hired young people who were
previously unemployed,” Sadondo explains.
Two other projects put solar energy to use. In
one, incubators for guinea fowl eggs are heat-
ed, while the other uses solar power to regu-
late the pressure of drip irrigation systems in
horticultural projects in Zimbabwe. “It is be-
coming increasingly clear that technology is
the key that will enable countries worldwide to
adjust to climate change,” says Sadondo.
At the conference in Rio, experts and politi-
cians will discuss how the world’s population,
especially the inhabitants of poor countries,
can gain sustainable access to medical sup-
plies, water, energy, education, and food. Many projects demonstrate what is already
achievable. For example, in Kalwa, near Mum-
bai, India, a sewage treatment facility based on
the use of plants recycles waste water from
Siemens’ local campus. On an annual basis,
the facility saves some 12 million liters of wa-
ter and reduces costs by €4,500 (see Pictures
of the Future
, Fall 2011, p. 102).
What’s more, many cities already feature
unmanned subways and hybrid buses that
Pictures of the Future | Earth Summit 2012 in Rio de Janeiro
In 1992, experts and politicians attending the Earth Summit in Rio de Janeiro asked themselves how the world could be made more sustainable. At the follow-up summit in June 2012, they will discuss how slower economic growth can be reconciled with greater sustainability.
Rio+20: It’s Time to Act — Now!
Projects for Improving Life in Developing Countries
“We can act now” is Siemens’ slogan for the 2012 Earth Summit in Rio de Janeiro. To ensure that new
ideas get noticed, Siemens will be teaming up with partner organizations to bring dedicated young peo-
ple to Rio from all over the world. These “Students for Sustainability” will present specific suggestions as
to how a range of technologies can increase sustainability in a cost-efficient manner. In cooperation
with non-government organizations (NGOs) and non-profit partners, Siemens has been working for
many years on numerous projects for improving living conditions in developing countries and emerging
markets. As part of an initiative called “Technologies in Action,” Earth Summit organizers will be dis-
seminating their knowledge at a site close to the Rio+20 conference. Experts will show how certain
technologies can improve people’s living conditions in ways that are often surprisingly simple.
For example, Rhett Butler from Siemens
Water Technologies in Sydney has developed
the Skyhydrant mobile water filter, which
treats contaminated water. Butler has also
created the SkyJuice Foundation, which has
so far established local partnerships in 42
countries in order to supply people with clean
drinking water at very low cost. (Pictures of the Future, Fall 2011. pp. 30/37)
The NGO Expedicionários de Saúde, which is
financed solely through donations, brings
doctors and medical equipment to native
villages in Brazil’s Amazon basin. The doctors’
equipment includes ultrasound devices from
Siemens and enables doctors to perform
operations locally in cases of hernia and eye
disease, for example. (Pictures of the Future, Fall 2011, p. 44) EU-supported WE!Hub, a joint project organ-
ized by the Siemens Foundation, the Global
Nature Fund, Osram AG, and Thames Electri-
cals Ltd., is bringing solar power to remote
areas of Kenya. The project is giving people
access to clean drinking water and electricity,
which is used primarily for lighting and mo-
bile communications. (Pictures of the Future, Spring 2009, p. 92) Other organizations will also be on hand at Rio+20 to present their solutions for improving people’s liv-
ing conditions. Among them will be the Community Impact Development Group — a network of social
entrepreneurs established by the Siemens Foundation in cooperation with Ashoka, one of the world’s
largest international organizations for supporting social entrepreneurs.
help to reduce traffic jams and offer inhabi-
tants a quick and environmentally friendly
commute to work. Solar power stations, wind
turbines, and efficient gas turbine power
plants are already providing a sustainable sup-
ply of energy in many places. Even seawater
desalination, a generally energy-intensive
technology, can become much more energy-
efficient. Siemens researchers have built a pilot
plant in Singapore that uses membranes and
electrical fields to cut energy use in half. Fataar and Sadondo agree that we need to
make use of existing options. “Siemens is
showing that many existing technologies can
help people achieve a better quality of life —
but we must continue to put pressure on politi-
cians to finally reach binding agreements,”
says Fataar.Katrin Nikolaus
Pictures of the Future | Spring 2012 4140 Pictures of the Future | Spring 2012
Highlights
46 A Village that Harvests Energy
The village of Wildpoldsried is a model for energy use. Here, a smart grid balances energy produced by renewable sources with demand. The village produces twice as much environmentally-friendly electricity as it consumes.
49 Transitioning to Renewables
Stephan Kohler, head of the German Energy Agency, explains why Germany’s power industry is experiencing an unprecedented shakeup. 50 Let’s Make a Deal!
Many infrastructure projects are
stymied by public acceptance problems. Switzerland has demonstrated how this Gordian knot can be amicably resolved.
60 Simulating Interactions
Siemens researchers are using a new
software platform to create entire
neighborhoods in a virtual city with
just a few mouse clicks. The system
shows them how different stages of
construction will affect their sur-
roundings, including traffic patterns,
energy balance, local employment,
and economic development.
66 How to Boost Transport Capacity
Automation technology is making traffic infrastructures more efficient. In the future, such systems will learn from experience and holistically optimize traffic across regions.
2040
In the middle of a Chinese metropolis there’s
an old, traditional neighborhood whose infrastructure is no longer compatible with
the rest of the city. A new high-tech complex
is being planned in order to connect the
neighborhood with the modern age. But be-
fore any work begins, urban planner Li inves-
tigates the project’s potential future effects.
His tool is a new holographic laboratory that
realistically simulates the future. D
arkness and silence surround Li, making
him feel disoriented and slightly dizzy. A
young Chinese urban planner, Li remembers a
warning from Shi, his project’s chief engineer
and the man who developed the new urban
planning center: “Close your eyes while you’re
uploading the data. If you don’t, you’ll mess up
my expensive laboratory.” So Li follows Shi’s
advice. Slowly he regains his sense of balance.
The air is warm and dry and smells rather ster-
ile. “The program was successfully uploaded,”
whispers a voice in Li’s ear. “Please open your
eyes.” A Chinese megacity in 2040. In an urban simulation
lab, Li and colleague Shi investigate the impact of a planned construction project on a traditional neighborhood. Li’s method for exploring the situation: full immersion.
What If…?
Mastering Complexity | Scenario 2040
A gentle breeze strokes Li’s face. There’s a
faint smell of chicken soup and poultry ma-
nure in the air. The pleasantly sunny lane in
which he finds himself is lined with trees, and
behind them stands a row of traditional wood-
en houses. Old men are sitting in front of the
houses, smoking and playing mahjong. A dog
is barking in one of the backyards. Li strolls
along the lane. He feels cracked asphalt under
his feet and almost trips over one of the bumps
in the roadbed. Shi’s holographic simulation is
so perfect that it’s almost eerie. But that’s all
right Li says to himself. Pictures of the Future | Spring 2012 43
G
roßbreitenbach is a small, picturesque re-
sort town in Germany’s Thuringian Forest.
It is also part of one of the most revolutionary
and complex energy projects of the present
day. Not that the town’s 2,700 inhabitants
would see it that way. For them, Großbreiten-
bach’s chief claim to fame is being the birth-
place of German winter sports legends
Manuela and Andrea Henkel, both Olympic
and world champions in their respective disci-
plines. For some time now, however, there has
been a cloud on Großbreitenbach’s horizon.
The reason for this is a decision by the federal
government to progressively replace current
electricity generating systems with renewable
sources of energy. With the country’s last nu-
clear power station due to be taken out of
service in 2022, Germany is looking to boost
its proportion of green power to 35 percent by
2020 and 80 percent by 2050. “This amounts
to an unprecedented shakeup of the power in-
dustry — a shakeup that is unparalleled in its
complexity,” says Stephan Kohler, head of the
German Energy Agency (see p. 49). What
makes this ambitious plan so complex is that it
will require huge amounts of renewable ener-
gy, new grid technology, and new energy stor-
age systems. For the people of Großbreitenbach, that
means agreeing to a huge overhead transmis-
sion line right on their doorstep. The line will
carry power from wind farms in northern Ger-
As our cities continue to grow in size and density — and with them our power, water, and traffic networks — we will require more and more computer assistance to understand and manage the world.
The only way to accomplish this while keeping humans in the driver’s seat is to keep things simple. Solving the Simplicity Puzzle
Mastering Complexity | Trends
42 Pictures of the Future | Spring 2012
Only if even the most minute details are
represented will it be possible to simulate all
the effects of a construction project on this old
neighborhood. This part of the city has been somewhat
neglected in recent decades, and its outdated
infrastructure is no longer compatible with the
rest of this hyper-modern megacity. Urban
planners must be particularly careful when
dealing with such rarities, because changes to
traditional structures could have unforesee-
able consequences. A lone electric bicycle silently approaches
Li. He instinctively steps back onto the side-
walk, where he almost collides with a young
woman. “I’m sorry,” he murmurs. The girl
smiles back at him. “I didn’t invest ten million
yuan just to create a dating portal,” growls
Shi’s voice in the background. “Believe me,
she’s literally untouchable — like all the other
people you’re looking at. Let’s get down to
work!” Li looks around to find Shi, but he only
sees an old man with a pipe between his teeth.
“Computer,” Li commands. “Launch the plan-
ning program.” Like a gigantic video game, an impressive
complex of buildings rises within seconds at
the end of the old lane. Gigantic mirrored
blocks reflecting the sunlight pile up one by
one, as though they were being stacked by an
invisible hand. Li blinks. The narrow lane is
plunged into blazing sunlight, and the air
grows noticeably warmer. The old man with
the pipe has disappeared. “All right, Shi,” says Li. “First point of criti-
cism. We’ve got to redesign the architecture.
It’s too bright, and the ambient temperature
has risen by two degrees.” He points to a tem-
perature scale that comes into focus in the
empty space. “Check,” says Shi’s voice in the
background. “Now I’ll start the time-lapse sce-
nario from ‘zero hour’ to a point two years after
completion of the complex.” At breathtaking
speed, the sun sets behind the buildings, night
envelops the neighborhood, and the next day
breaks. Clouds race across the sky and people
rush along the streets. The stream of traffic is
transformed into a colorful gleaming ribbon
that zips right through Li. “Stop! That’s enough!” he shouts in slight ir-
ritation. “Give me more of an overview, Shi.”
The world surrounding Li abruptly starts to
shrink. Suddenly he’s standing like a giant be-
tween the buildings. The highest ones barely
reach his knees. Meanwhile, the street life con-
tinues at its normal pace. “It’s 9 a.m., exactly
18 months after the ribbon-cutting ceremony,”
says Shi. “By the way, you don’t have to walk so
carefully, you can’t damage anything here.
How do you like life in the future?” In the small lanes at Li’s feet there’s lots of
traffic, with countless cars honking, searching
for a gap in the traffic flow, and even blocking
the narrow sidewalks. “This reminds me of the
traffic situation we had 30 years ago,” he says.
“We didn’t expect this. The additions have ob-
viously made the old neighborhood much
more attractive, even though we only built a
new complex. Computer, show me the current
rent levels.” A graphic appears in the sky.
“Rents have risen considerably,” Li observes.
“On the streets I can see lots more young peo-
ple wearing modern clothes. It’s a clear case of
gentrification.” Next, he points to a couple of intersections.
“These locations need new subway stops. The
old bus line is definitely no longer sufficient.
Computer, extend the subway line and restart
the simulation.” Several subway stops pop out
of the ground like mushrooms at the points Li
has indicated, and the traffic subsequently
thins out. “Shi, zoom me back into the action,”
Li requests. While Li is shrinking down to his
normal size, the young woman he bumped
into earlier comes out of a front door and turns
toward him. “Ever since you dropped that hulk
of a building on our doorstep, we get black-
outs three times a week,” she complains. “And
our water bill is sky-high.” Li looks at the
troublesome hologram in admiration.
“That’s a great idea, Shi — letting the
digital locals speak up for themselves.
Please show me the neighborhood’s
energy flow.” Seconds later, a detailed plan of
the power grid materializes directly in
front of Li’s eyes. “I’ve solved the prob-
lem,” says Shi’s voice in the background.
“The neighborhood’s power grid hasn’t been
renewed yet, but private traffic has increased,
so too many electric vehicles are being
recharged simultaneously.” Li orders the com-
puter to set up a smart grid to stabilize the
power network. “Scan the water supply net-
work too,” he says. “I suspect that the construc-
tion of the subway has caused many small leaks.
Besides, the influx of people into the neighbor-
hood has probably also increased water de-
mand.” The young woman flashes Li a grateful
smile. “Stop flirting with my software,” Shi’s
voice interrupts them. “Close your eyes, we’re
going to stop now and continue tomorrow.” When Li opens his eyes again, the little
world with its smells, its old houses, and their
inhabitants has disappeared. He’s standing in a
stark white room. He can’t see any walls or
ceiling — only a door that is opening a few
meters in front of him. Shi sticks his head in,
saying, “Come on, let’s go have dinner. I’ve in-
vited someone I know to join us. I hope that’s
all right with you.” As the two men walk into
the restaurant, they see a young woman sit-
ting at the bar. She gives Li a big smile. It’s the
girl from the hologram. Florian Martini
many to consumers in the south. At present,
local resistance is high, and action groups have
been formed. In the wider context, however,
each link in the country’s energy chain — from
offshore wind farms in the North Sea, to small
towns in Thuringia, and the vision of a green
future — is connected. “That’s what makes
everything so complicated,” says Kohler.
The people of Großbreitenbach might take
a jaundiced view of their allotted role in Ger-
many’s energy revolution, but the mood 400
kilometers further south couldn’t be more pos-
itive. For instance, in the village of Wildpold-
sried in the Allgäu region of Bavaria, the town’s
2,500 inhabitants have established a pilot re-
newable energy economy that would be the
envy of any small town. With its photovoltaic
panels, biomass digesters, and wind power
plants, Wildpoldsried already produces twice
the amount of electricity it consumes. The
downside is that all this surplus energy severe-
ly strains the local grid. Depending on the
amount of sun and wind available, output can
fluctuate by as much as 40 megawatts over a
period of 30 minutes. With a view to improving grid stability,
Wildpoldsried’s nearest utility — Allgäuer Über-
landwerk — is testing new technology in col-
laboration with Siemens (see. p. 46). Studies
have focused on the use of smart grid systems
to coordinate the complex processes within
the grid as energy from renewable sources is
fed in. Automated technology supported by
software agents is being tested to manage
power flows and balance input against con-
sumption. In a later phase, the project will in-
corporate 32 electric cars that will be available
for leasing by Wildpoldsried inhabitants. The
vehicles’ batteries will provide intermediate
storage for surplus electricity. This growing complexity also extends to
other areas of modern life. In our cities, for ex-
ample, different elements infrastructures are
woven together in an intricate network. Such
networks become increasingly difficult to visu-
alize and predict as more people make use of
them. By 2015 the world will have at least 25
major metropolitan areas with over 10 million
of energy producers and consumers, software agents
will purchase and sell energy autonomously, and com-
ponents in factories will be fitted with smart labels that
enable them to organize themselves and control pro-
duction processes via radio communication. Industrial facilities will also collect data on entire
product lifecycles in order to optimize manufacturing,
product operation and recycling, while integrated traffic
and transport systems will combine various modes of
transport in order to get travelers to their destinations as
quickly and conveniently as possible. The images gener-
ated by state-of-the-art medical devices are already be-
ing interpreted by computers and then linked with infor-
mation from knowledge databases in order to assist
physicians with their diagnoses.
This Internet of Things will make it possible to access
knowledge in a totally new way and also enable the de-
velopment of new business models and services. A new
Internet of Knowledge and an Internet of Services will
be created in a similar manner. Most importantly, how-
ever, the number of objects and items linked to one an-
other via the Web will increase rapidly. Market re-
searchers at IDC, for example, expect that 15 billion
online-enabled devices will be linked to one another
worldwide as early as 2015, and this number will in-
crease to more than 50 billion by 2020.
Hans Schürmann
Pictures of the Future | Spring 2012 45
Mastering Complexity | Facts and Forecasts
Learning from Nature
C
omplex systems such as weather, traffic, stock mar-
kets, and biochemical processes in the body don’t
operate in accordance with chance but are instead sub-
ject to non-linear laws. The individual components of
such systems mutually influence one another and are
continually resorted. Dunes organize themselves, for ex-
ample, as do clouds, ant colonies, the light pulses in
lasers, and signals in the brain. The complexity of a sys-
tem increases in line with the number of elements it
contains, the number of connections between these ele-
ments, and the degree of non-linearity in the relation-
ships between the connections. As a result, doubling the
intensity of a signal doesn’t necessarily yield twice the ef-
fect, for example, but might instead lead to a four- or
even eight-fold increase in signal strength. The theory of complex dynamic systems neverthe-
less often allows trends affecting several systems to be
modeled on the basis of just a few parameters. For ex-
ample, an intelligent traffic guidance system doesn’t
need to know the actual behavior of each driver on the
road in order to be able to forecast certain traffic waves
or gridlock. Instead, such a system is trained to discern a
trend at the right moment from fluctuating traffic densi-
ty patterns and then adjust traffic light sequences or
tunnel entrances as needed. The brain offers one of the most interesting exam-
ples of a complex system. When people learn new
things, the nerve cells in their brains autonomously cre-
ate new connections and form new neural networks. The
stimulus patterns transmitted by sensory organs ensure
that ever-more complex behavioral patterns are created
as a result. The knowledge gained from brain research
and studies of complex systems in general has also led
to a paradigm shift in computer science. For quite some
time, scientists thought that complex systems could be
controlled only with superordinate programs — but to-
day we know that many processes in power generation,
manufacturing, traffic guidance systems, and logistics
can be managed by neural networks that function in a
manner similar to the way nerves link up in the brain.
The big advantage here is that such artificial neural net-
works can learn from examples generated in real time
and respond flexibly to changed conditions.
Neural networks are used today to control the oper-
ations of power plants. For example, the gas turbine
that Siemens built in Irsching, Germany, for what is cur-
rently the world’s most efficient power plant is equipped
with thousands of sensors that continually monitor air
pressure, exhaust gas temperatures, and emissions.
Software systems modeled on the human brain then
evaluate the data and learn autonomously while doing
so. The measurement data isn’t used to optimize just
one power plant, however; using a sort of swarm intelli-
gence, it’s also possible to link several plants that contin-
ually optimize themselves during operation on the basis
of experience. Similarly, in the future “Internet of Things,” many de-
vices will be able to exchange data with one another, ac-
cess Web services, and interact with people. Clothing
will tell washing machines what temperature needs to
be set, for example, and cars will communicate with one
another in order to prevent traffic jams and avoid acci-
dents. The power grid of tomorrow will link thousands
Stored Data is Increasing at 45 Percent per Year
Global data volume in exabytes. 1 EB = 10
18
bytes
2005
2010
2015
Year 130
1,227
7,910
Discrepancy between Human & Machine Resources
Source: IDC Digital Universe Study 2011 (both charts)
Global multiplication factor of the number of…
Data Exchange
between Machines …Servers …Files used in company data centers ...IT experts As of 2011 (=1.0)
Growth by 2020
× 10
× 75
× 1.5
2011
0
2012
2013
2014
2015
2016
0.1
0.2
0.3
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Source: Cisco VNI Mobile, 2012
Exabytes
Neuronal pathways? Transport
hubs? Neither. The complex network shown here depicts connections on the Internet.
44 Pictures of the Future | Spring 2012
inhabitants. The complexity of even the largest
of anthills, which may have up to two million
creatures, is modest by comparison. In such
complex systems, even minor changes may
have major consequences. The construction of
a new subway line, for example, may have a
huge impact on nearby electricity, gas, and
water supply systems — not to mention local
residents. To date — and much to the regret of
urban planners — it has proved difficult to pre-
dict such interactions and their effects. Simulating Cities. Engineers from Siemens
Corporate Technology (CT) are attempting to
unravel these complicated interdependencies.
To this end, they have developed a software
platform that creates a virtual conurbation in
its entirety and enables engineers to plan and
simulate modifications to infrastructures (see
p. 60). With a few clicks, scientists can create
streets. The software shows them what impact
new construction work will have on a neigh-
borhood, including potential traffic congestion
and effects on a district’s energy balance. Re-
searchers are also using the software to de-
duce socioeconomic indicators such as em-
ployment rates and per capita economic
output. And there are plans to incorporate lo-
cal building regulations and energy efficiency
requirements into the simulations, as well as
to add long-term factors such as climate and
demographic trends, which can have an im-
pact on proposed construction work.
Cities seem complicated enough on the sur-
face, but the real challenges often lie hidden
underground, where a maze of water mains
extends like a huge spider’s web. As a city
grows, so too does its labyrinth of pipelines —
and the problem caused by leakage. London’s
water network, for example, is 30,000 kilome-
ters in length. Even affluent cities are plagued
by water losses (see p. 64). Were London to re-
duce leakage from its mains by a mere one
percent, the water saved would suffice to sup-
ply an additional 224,000 people. In developing countries, the situation is
much worse. According to the World Bank, to-
tal losses due to leaking water pipes amount to
45 million cubic meters a day. Added to this
crass waste is the problem of diminishing wa-
ter quality, since cracks in pipes are an open in-
vitation to contamination. Small leaks are diffi-
cult and expensive to locate, in large part
because of the relative scarcity of flow meters
and similar monitoring devices. Siemens engineers have now come up with
a system that is capable of automatically de-
tecting even the smallest cracks in large
pipeline networks. The system measures water
usage during periods of low consumption,
such as at night, in various parts of the net-
work, thereby determining respective refer-
ence values. If these values are subsequently
exceeded, thus indicating a leak, the system
sounds an alarm. Smart technology can be used not only to
monitor drinking water supplies but also to
ease the flow of traffic (see pp. 66, 69). In
some places this rising tide of metal is threat-
ening to choke our streets. There are nearly
seven million vehicles in Jakarta, for example,
and these are joined by over 1,100 new cars
and motorcycles every day. The resulting grid-
lock in Indonesia’s capital is very costly. Ac-
cording to a study conducted by environmen-
tal expert Firdaus Ali from the University of
Indonesia, damage to the city’s economy
caused by traffic congestion amounts to
around $3 billion per year — all due to lost pro-
ductivity and growing healthcare costs associ-
ated with poor air quality (see Pictures of the
Future,Fall 2011, p. 31). But there are rays of hope. For the 8.5 mil-
lion inhabitants of the Chinese city of Wuhan,
for instance, road travel has recently improved,
thanks among other things to a sophisticated
traffic management system from Siemens. A
total of 420 intersections, turnoffs, and junc-
tions have been equipped with cameras to
monitor the flow of traffic. Data is sent to con-
trol centers, where computers calculate the
optimal switching times for traffic signals, so
as to prevent traffic jams and other obstacles
from forming wherever possible. Berlin also uses digital technology from
Siemens to control its traffic. In Germany’s
largest city, one of the world’s most modern
traffic management centers went into opera-
tion in 2005. It provides fully automated con-
trol of over 1,700 traffic lights and 300 sign
gantries, based on real-time traffic data and
time of day.
Striving for Simplicity. Road, water, and
power networks are not the only systems that
continue to grow in size and complexity, thus
requiring increasing support from sensors and
computers capable of evaluating their real-
time condition and optimizing their functions.
In the broader realm of machine-to-machine
communication, analysts from market research
company IDC have calculated that by 2015 a
total of 15 billion intelligent devices will be
networked, with this figure projected to rise to
over 50 billion by 2020 (see p. 45). This trend
poses a variety of new challenges, including
the question of how to make such devices as
simple and as intuitive as possible to operate,
while ensuring that they remain invulnerable
to hackers (see p. 62). This convergence of
needs is a major challenge. At Siemens Corpo-
rate Technology’s Usability Laboratory re-
searchers are responding by coming up with
ways of making complex systems easier to use.
Their projects range from CT scanners to new
apps designed to simplify the recharging of
electric cars (see p. 58). All the same, when it comes to implement-
ing major projects such as the overhead trans-
mission line near Großbreitenbach, far more
than simplicity is needed. The Swiss have
shown how radically-differing opinions can be
reconciled (see p. 50). Plans to build a recy-
cling center in the canton of Aargau initially
met with stiff local resistance. However, by the
end of the consultation process even those
communities most affected were in favor of
the project. The “trick” used by the authorities
was to let the citizens themselves decide.
Florian Martini
In major urban centers, infrastructures such as those for water supply, energy and logistics are interwoven.
Pictures of the Future | Spring 2012 47
Wildpoldsried in the Allgäu region of Germany produces over twice as much electricity as it needs. It
does so with the help of wind and solar facilities and
a biogas unit operated by Ignaz Einsiedler (right). 46 Pictures of the Future | Spring 2012
neys in many barn yards. Numerous houses
get their heat from a 4.7-kilometer district grid
that Einsiedler and other local citizens built
and financed through a cooperative estab-
lished for this purpose. Einsiedler also owns
shares in a network that delivers gas to three
other co-generation plants and in five wind en-
ergy facilities that the villagers jointly financed
without any outside investment. “The people in Wildpoldsried are crazy in a
positive way,” says Guido Zeller, an attorney at
AllgäuNetz GmbH & Co. KG, which operates
the local grid. The craziest one of all is proba-
bly Arno Zengerle, who has been the village
mayor since 1996. At the start of his first term,
Zengerle asked citizens to vote on the village’s
development goals. “Climate protection can
only be effective with the help of the people,
not against their wishes,” says Zengerle. And
the people are behind it, as Wildpoldsried now
generates more than twice as much electricity
as it consumes. Indeed, many of the villagers
I
gnaz Einsiedler climbs nimbly up the ladder
to the huge gray bubble that arches above a
massive tank. A brown brew consisting of
grass, corn, and other types of biomass mixed
with slurry bubbles underneath the rubber
covering — “like a giant cow stomach,” as the
63-year-old farmer describes it. This “stomach”
digests the biomass and transforms it into
methane, which is burned by two gas motors
in Einsiedler’s basement to produce electricity.
Einsiedler feeds the electricity from the biogas
generator — and from three photovoltaic units
on his roof — into the power grid operated by
Allgäuer Überlandwerke GmbH (AÜW). Like many of the 2,500 inhabitants of the
village of Wildpoldsried in the Oberallgäu dis-
trict of southern Germany, Einsiedler is an en-
ergy pioneer. Almost every roof here sports
blue solar cells that shimmer in the sun. Ex-
haust gases from combined heat and power
(CHP) plants that run on methane produced by
biogas fermentation rise from metallic chim-
Mastering Complexity | Smart Grids
Much has happened since IRENE was
launched. For example, AÜW has installed
around 200 measurement devices — black
boxes with mobile communication links — at
solar and biogas plants and in transformers.
Weather measurement data and Webcams are
also being used to monitor cloud movements.
The goal is to gain an overview of who’s feed-
ing power into the grid or extracting energy
from it, when and where they do it, and how
all of this affects the network’s stability. “We
need to manage the dynamics of the network,”
says Hammer, who points out that around
three gigabytes of data are sent to AÜW head-
quarters in nearby Kempten every day. Once the key points in the grid are identi-
fied, targeted measures can be taken to correct
problems. To this end, Siemens has installed a
variable transformer that offsets voltage fluc-
tuations — a device that is normal in high-volt-
age grids but is a complete novelty in second-
ary-voltage local networks. Smart Grid Appliances: Who Wants Them? Claudia Häpp, Smart Grid and Home Connect project manager at BSH
Bosch und Siemens Hausgeräte GmbH, talks about how household appli-
ances operate in a smart grid.
Household appliances that automatically use the least expensive
electricity will be a key part of the smart grids of tomorrow. What
do customers think about them?
Häpp:We tested smart grid-enabled appliances such as dishwashers and r
efrigerators in field trials car-
ried out with various energy suppliers. To th
e extent that energy information is available, the devices au-
tomatically draw electricity from the cheapest sources. We used fictitious electricity rates and tested the
appliances; average savings for the households amounted to 25 percent. As might be expected, the
feedback we received was positive. But we also discovered that while many consumers are interested in
this issue, they don’t have detailed knowledge of their electricity rates — which is important if the sav-
ings potential of the smart grid is to be exploited. Of course customers should be able to decide whether
they want to use smart grid applications. That’s why our smart grid dishwasher has a button that can be
used to disengage the function that lets the grid select the time when the machine should be turned on. How much are customers willing to pay for these features? Häpp:Smart grid-enabled appliances shouldn’t be more than €50 to €100 more expensive than conven-
tional units. S
till, market researchers ha
ve found that the savings alone aren’t enough of an incentive to
purchase. We need a broad range of other functions — like being able to download a recipe from the In-
ternet to your oven, after which the oven automatically chooses the settings needed for the dish. Other
features might include using your smart phone to check if you turned off the stove, or enabling an appli-
ance to report a breakdown to a customer service center via the Internet. When does BSH plan to launch its first smart grid-enabled appliances?
Häpp:Right now we only have pre-series products because there aren’t any standards, but this will
c
hange in the next few years. W
e are now working with the European Committee of Domestic Equip-
ment Manufacturers to develop utilization scenarios in order to study how washing machines will react
to a smart grid load-shift request, for example. The results will be incorporated into the standards stipu-
lated by European and international standardization bodies such as Cenelec and IEC. Ultimately, con-
sumers will decide whether or not they want to invest in a networked appliance. One thing is clear,
though: People will want energy-efficient appliances, with or without the smart grid. have become both producers and consumers
— so-called “prosumers” — of energy.
Energy Surplus Headache. Wildpoldsried of-
fers a preview of what’s in store for all of Ger-
many over the next 20 years. However, things
aren’t as easy as they look. Simply building so-
lar, wind, and biogas power generation facili-
ties isn’t enough. The electricity produced by
renewables has to get to consumers, and a sys-
tem must be in place to maintain a balance be-
tween energy production and consumption.
Still, Wildpoldsried’s problem today is one
every community would like to have. It has far
too much electricity. In fact, fluctuations in the
grid feed can cause output variations of as
much as eight megawatts in just half an hour. This energy surplus is a big headache for
Robert Köberle, who works ten kilometers
away in Kempten, where he’s responsible for
maintaining the stability of the AÜW grid re-
gardless of how much electricity is being fed
Also new is a system for remotely control-
ling the inverters in photovoltaic units. When
the sun shines over the Allgäu mountains, the
solar modules there collect so much electricity
that the resulting output of alternating current
is too high. Managing inverters from a central
location safeguards voltage quality and stabi-
lizes the grid. “Actually, you’re not allowed to
do this even if the lines start smoldering,” says
Hammer. The problem is that Germany’s Re-
newable Energy Act requires all power gener-
ated from renewable sources to be taken in by
grid operators. But IRENE partners were able to
obtain an exemption from this stipulation, and
they now expect that precise data collection
and their system’s sophisticated controls will
keep losses to a minimum for Wildpoldsried’s
energy farmers. Intelligent Balance. The centerpiece of Wild-
poldsried’s smart grid is Self-Organizing Energy
Automation System (SOEASY) software, which
cleverly balances supply and demand and
keeps the grid stable. But SOEASY isn’t as sim-
ple as its name suggests. The distribution net-
works that bring electricity to households have
several times as many components as the
main high-voltage transmission grid. To ensure that things don’t get too compli-
cated, engineers and computer scientists at
Siemens Corporate Technology (CT) have de-
veloped scaleable hardware and software
modules, so that even as the smart grid ex-
pands, the costs associated with it will increase
only moderately. All the components for col-
lecting and transmitting data and remotely
controlling facilities are plug-and-play-enabled
and thus can be installed in solar power invert-
ers without any need for additional program-
ming.
Several SOEASY components operate in a
decentralized system — but “a central control
unit that balances out everything increases the
distribution grid’s ability to absorb electricity
into or taken out of it at any given moment. In
2010, AÜW chose Wildpoldsried as the site for
an ambitious experiment that involved estab-
lishing a smart grid that automatically stabi-
lizes the power network. Smart grids hold the
key to the energy systems of the future, be-
cause they make it possible to distribute ener-
gy from renewable sources without putting
electricity networks at risk. While AÜW was making its plans, Alexander
Hammer from Siemens’ Infrastructure and
Cities Sector was looking for a grid operator as
a project partner for testing new smart grid
technologies. Siemens and AÜW signed a co-
operation agreement in April 2011 to set up
IRENE (Integration of Regenerative Energy and
Electric Mobility), a roughly €6 million invest-
ment project. One third of the money is being
contributed by the two partners; the rest
comes from Germany’s Ministry of Economics
and Technology, which quickly realized how
important the project was. A village in southern Bavaria produces more environmentally friendly electricity than it consumes — which makes it an ideal place to test smart grid technologies. Pilot projects are being managed by Siemens, the local utility, and two universities. A Village that Harvests Energy
Pictures of the Future | Spring 2012 4948 Pictures of the Future | Spring 2012
Stephan Kohler, 59, is the
Managing Director of the Ger-
man Energy Agency (dena) —
a center of expertise for ener-
gy efficiency, renewable
sources of energy, and intelli-
gent energy systems. The
agency’s ownership is split in
half between the Federal Re-
public of Germany and four fi-
nancial services companies.
dena operates in Germany
and abroad, advises govern-
ment ministries and compa-
nies, provides information to
consumers, publishes reports,
develops scenarios for viable
future energy supply systems,
and implements concrete
projects in cooperation with
partners from industry. dena
is a founding partner of the
Russian-German Energy
Agency, and also shares an of-
fice in Beijing with the Chi-
nese Renewable Energy Asso-
ciation.
How Germany Plans to Transition to Renewables by 2030
sources such as wind and solar power don’t al-
ways produce electricity when it’s needed and
are often located in regions some distance
away from where the power is needed. Their
annual use times are relatively short as well. In
Germany, photovoltaic systems, for example,
only generate electricity for an average of 850
full-load hours per year. So we need to install
a lot more capacity, and we also have to ex-
pand the grid at all voltage levels and make it
more intelligent. In addition, we need to have
more energy storage devices, some of which
still have to be developed and made mar-
ketable. If 50,000 megawatts of solar power
and the same amount of wind energy are fed
into the grid in 2020, it will not be possible to
sensibly integrate such a large proportion of
fluctuating power generation within a nation-
al system. That means we have to intensify
our work with neighboring countries in areas
such as the use of pumped-storage hydroelec-
tric facilities. A paradigm change is also re-
quired, because along with improving energy
efficiency we also need to focus more strongly
on the demand side of the equation and coor-
dinate energy production and consumption
more effectively with the help of demand-
management systems. Is it really possible to effectively manage
such a complex project?
Kohler:The pace of the energy transition pos-
es c
hallenges for which we still don’t ha
ve
complete solutions or the required experience.
I believe we can accomplish the transition —
but we’re going to need a roadmap that in-
cludes the milestones that must be reached if
we’re to achieve our goals and make imple-
mentation as efficient as possible. These mile-
stones must be defined for all aspects of the
energy transition and take into account the
impact they will have across all systems, be-
cause the mutual effects will be substantial.
The German government wants to see a mil-
lion electric vehicles on the road by 2020, for
example — but all of them need to run on
electricity from renewable sources if the
whole thing is to make any sense environmen-
tally. That means we need to have more intelli-
gent networks to ensure that the grid remains
stable, and this will require more networking
between all the key players — meaning gov-
ernments, business, and consumers.
What do you think our energy system will
look like in the future?
Kohler:We need to closely examine what’s
going t
o happen over the next 10 to 20 years
in par
ticular. We know the technologies that
will be involved and we can estimate which of
them will be available and which ones won’t.
However, trying to describe our energy system
in the year 2050 would be somewhat pre-
sumptuous. We have to make sure that the
system isn’t rigid but can instead be easily
adapted in line with future developments such
as electricity storage by means of electrolysis
and hydrogen. We can plan everything up to
2030 and it makes sense to define our long-
term goals, but we can’t say today which tech-
nologies we’ll have to use in order to achieve
those goals. We also have to radically change
our focus from the energy supply itself to en-
ergy services. We have to create the political
and economic conditions that will allow us to
design our energy system efficiently. The ad-
vantages of this for industry lie in lower ener-
gy costs and greater competitiveness. Along
the way, we will be able to enter new markets
with our technologies, because efficient ener-
gy systems are in great demand all over the
world. Interview by Florian Martini
Mastering Complexity | Interview
from renewable sources,” says Dr. Michael Met-
zger, project manager for IRENE at Siemens CT.
Personal Local Energy Agents — autonomous
software modules — control the interaction
between decentralized consumers and produc-
ers and the grid. Every “prosumer” has such an
agent, which can be used to reserve central-
ized services such as weather forecasts or sys-
tem optimizations via a marketplace. There’s
also a Network Transport Agent that monitors
grid status in real time, an Area Administrator
In the aftermath of the nuclear power
plant disaster in Fukushima, Japan, the
German government decided to gradual-
ly shift to an energy system based on re-
newable sources. Plans call for the share
of electricity produced this way to reach
35 percent by 2020 and 80 percent by
2050. How can Germany achieve these
goals?
Kohler:This long-term strategy is in line with
German
y’s energy transition process initiated
in 2000, although it also accelerat
es the pace
of the transition, which presents a huge chal-
lenge. The transformation of the energy sys-
tem in a highly industrialized country has to
be organized in a manner that makes sure we
remain internationally competitive as an in-
dustrial location. On the one hand, energy
consumption must be reduced through energy
efficiency measures. At the same time, renew-
able energy sources must be intelligently inte-
grated into the system. This will require ex-
panding the grid infrastructure, developing
new storage systems, and introducing smart
grid components. The electricity we generate
in the future will be generated by millions of
distributed power plants that will often pro-
duce electricity at the same time, which
means they will function like a single giant
generator. We also need to build conventional
power plants in the 10,000 MW range in order
to ensure supplies. What are the challenges here?
Kohler:The energy transition is a highly com-
ple
x project in terms of its impact on society,
technologies, and t
he economy. Up until now,
we’ve used energy carriers with a high energy
density — natural gas, oil, uranium, and coal
— all of which are easy to store. The transition
is complicated because renewable energy
that maintains network stability, and a Balance
Master, which plans key adjustments hours or
days in advance on the basis of parameters
such as expected changes in the weather. All of these software agents are highly in-
terconnected and automated. They control the
actuators in the grid in a way that ensures
good voltage quality. Such actuators include
new variable transformers for the local grid,
battery storage units that will soon be in-
stalled, and inverters in photovoltaic systems.
A power exchange that will allow agents to ne-
gotiate electricity deliveries will also be set up
before the project is completed. Another special feature of the project is the
fleet of 32 electric vehicles that are available to
Wildpoldsried residents. The cars are already
integrated into the village’s smart grid and
serve as a buffer for electrical energy. If there’s
an energy surplus, the vehicles’ batteries will
be given recharging priority. IRENE might also
examine the use of vehicles that can return
electricity to the grid in the event of power
shortages. The electric cars in Wildpoldsried still aren’t
an active part of the smart grid; the idea at the
moment is to monitor their use. That’s why
they’re equipped with navigation devices that
report their position. Researchers want to use
their movement profiles to determine the ex-
tent to which the batteries can be used as grid
buffers. The latter sub-project is being carried
out by scientists at the Kempten University of
Applied Sciences, who also analyze asymmetri-
cal load flows in the grid and work out logical
measurement point arrangements. The sec-
ond IRENE research partner is RWTH Aachen
University of Applied Sciences, which is using
the vehicle movement profiles to develop sim-
ulation models for larger smart grids contain-
ing thousands of electric cars. Although IRENE will conclude in the fall of
2013, the residents of Wildpoldsried will en-
sure that AÜW and Siemens still have plenty of
research to do. They plan to generate all of
their electricity and heating by 2020, and they
already have initial ideas for using wind power
to produce natural gas from CO
2
and water
(see Pictures of the Future,Spring 2011, p.26).
Some residents even plan to get their own
electric cars when the leased electric vehicles
are returned. Such vehicles would be com-
pletely emission-free. After all, there’s more
than enough environmentally friendly electric-
ity in Wildpoldsried.Bernd Müller
The Wildpoldsried smart grid includes 32 electric cars. The cars store excess energy.
An intelligent software system balances electricity supply and demand. Intelligent control systems regulate electricity production and the amount of energy fed into the grid.
Biogas units (right) automatically transmit data to energy suppliers. Pictures of the Future | Spring 2012 51
Many major projects are both complex and opaque. When acceptance of such projects wanes, transparent and structured procedures that enable citizens to participate in the decision-
making process can help — as projects in Switzerland and Brazil have demonstrated.
Protests against a rail project in Stuttgart led to demands for more citizen participation in decision-
making throughout Germany. Pictured is a mediation
meeting with former German Minister Heiner Geißler.
At a special show in St. Gallen, Switzerland, an elevator took visitors down 4,400 meters — at least virtually — to the projected sit
e of a geothermal heat project. Let’s Make a Deal!
50 Pictures of the Future | Spring 2012
transported 20 heavy steel components to a
drilling site where a geothermal power facility
was to be built in eastern Switzerland. The city
of St. Gallen wanted to reduce its use of fossil
fuels to just 25 percent of the energy mix by
2050 and provide geothermal heat to half of
its 44,000 residences. This energy source is cli-
mate-friendly and easy to access, because ex-
tracting heat from a depth of 4,500 meters
doesn’t require any major facilities that could
prove to be an eyesore. Still, the technology was by no means
without controversy, as a similar project in
Basel, Switzerland’s third-largest city, had been
scrapped after a water injection for tapping
into geothermal sources triggered a minor
earthquake in 2006. “Dialogue with local citi-
zens was therefore very important for us,” says
Marco Huwiler, General Project Manager at St.
Gallen’s public utility. “We also made sure our
project was embedded in an extensive grass-
roots democratic process.” The utility started out in 2009 by gauging
the opinion of some 50 interest groups and cit-
izens through interviews conducted in cooper-
ation with the independent Risk Dialogue
Foundation. B
ack in 1970, if the Gulf Coast Waste Dis-
posal Authority of Texas had known what
was coming, it would probably have aban-
doned its idea immediately. The agency had
decided to build a petrochemical waste dispos-
al facility in the Galveston Bay area. Although
the project was never carried out, it cost the
agency more than $10 million to deal with as-
sociated protests and local citizen initiatives
that seemed to come out of nowhere. After 15 years of legal battles and countless
court rulings in favor of citizens, public officials
finally invited citizen groups to a mediation
session at the Keystone Center in Denver, Col-
orado, a prestigious institute for conflict reso-
lution. This didn’t help, though. By then, citi-
zens were simply too enraged — and the
damage had already been done. After another
five years had passed, several members of the
citizens’ initiatives were elected to the Gulf
Coast Waste Disposal Authority executive
board. The NIMBY (“not in my backyard”) prin-
ciple had prevailed, and the waste disposal
project was history. But a look at Switzerland and Brazil shows
that things can work out differently in such sit-
uations. On a winter day in 2011 helicopters
Mastering Complexity | Citizen Participation
endum was held in the fall, in which 80 per-
cent of the electorate voted in favor of the
project. In Switzerland, grassroots instruments
such as initiatives and plebiscites ensure that
corrections can be made if doubts about a
project should arise later.
Moreover, the knowledge
that they can defend them-
selves this way if necessary
gives citizens in Switzer-
land a feeling of security
and enables the political
system to function effec-
tively. “That’s not surprising, given that we’ve
been practicing this type of grassroots democ-
racy for the past few hundred years,” says
Holenstein. But why did dialogue fail at the Keystone
Center in the U.S.? “Attempting to include citi-
that included closed workshops, public presen-
tations, interaction with the media to address
the more controversial aspects of the project,
and a special exhibition on the geothermal
project entitled “Journey to the Depths.” The
Risk Dialogue Foundation took part in this
process as an impartial observer that brought
subliminal emotions to the attention of partici-
pants and presented different views of the
project. “Because such issues were taken into
account at an early stage, there was no need
to have any specific mediation between the
utility and other interest groups,” Holenstein
explains. The municipal parliament of St. Gallen ex-
amined the results of this phase of citizen par-
ticipation in the summer of 2010 and a refer-
zens in a project that’s already been decided
on just doesn’t work,” says Professor Ortwin
Renn, Director of the Dialogik institute in
Stuttgart, Germany, and a mediator in disputes
over public projects (see p. 52). “Besides, the
battle lines had already been drawn.” What to Do? Several years ago, Renn and his
team illustrated how to do things correctly dur-
ing a dispute concerning a waste disposal facil-
ity in the Swiss canton of Aargau. “These days,
everyone understands the importance of effi-
cient waste treatment, but the people in the
affected areas felt that they were being ex-
posed to risks in the form of potential ground-
water contamination,” says Piet Sellke, who
works at Dialogik. “There were 11 possible
sites here in Aargau, and the canton govern-
ment let the citizens decide where the facility
should ultimately be built.” To this end, Renn and his team brought to-
gether some 90 residents from 12 municipali-
ties in Aargau and divided them into four citi-
zen commissions. Each municipality on the list
of possible sites was asked to send two repre-
sentatives to each of the four commissions.
“Unlike other citizen participation setups, the
municipal authorities selected the citizens who
would take part,” Sellke explains. The commis-
sion members included housewives, teachers,
representatives of nature conservation soci-
eties, farmers, and municipal councilors. “Not
every member had the same knowledge, so
the project team provided everyone with infor-
mation and written materials first,” The members were then asked to draw up
criteria diagrams for assessing the proposed lo-
cations in terms of suitability and risks. During
this process they were able to address ques-
tions to specialists, listen to expert testimony,
and visit the sites in question. The criteria they
came up with — e.g. environmental impact,
the economic efficiency of the project —
helped them compare the different locations.
After that, a closed workshop was held in
“St. Gallen is a relatively small city, a place
where people generally know one another,”
says Matthias Holenstein, a project manager at
the foundation. “That’s why we used the first
round of discussions to talk to the directors of
local associations, firefighters, long-standing
members of the community, officials from in-
dustry and political parties, young citizens and
teachers, as these groups offered a very good
sampling of public opinion. We also conducted
sample surveys to get the opinions of average
citizens. We found there was a positive basic
attitude to our plan. But of course there were
also some open questions of a financial and
technical nature.”
The city initiated a series of events to dis-
cuss the issues and provide citizens with more
detailed information. The main event was a
public conference with some 400 participants
Citizen commissions assessed the feasibility and risks of potential sites
for a waste disposal facility.
telsmann foundation for its budgetary policy.
“We searched all over the world for exemplary
projects that strengthen participation possibili-
ties for all social groups,” says Bertelsmann
Project Manager Christina Tillmann. “The citi-
zens of Recife decide every year on how ten
percent of their city’s budget will be allocated.
Over 100,000 people take part in the process,
which generated some 600 proposals in
2010.” The program focuses on urban develop-
ment projects for which citizens submit sug-
gestions. The city government distributes fly-
ers in all districts in advance so residents know
what’s on the agenda and what they have to
do. To this end, Recife is divided into 18 “micro-
regions,” which ensures that all districts
can express their wishes. “As soon as at
least ten people commit themselves to a
proposal, it is examined by the authori-
ties in terms of its technical and financial
feasibility,” Tillmann explains. This process is followed by public fo-
rums in which citizens select ten proposals per
micro-region and elect delegates who are then
trained in budgetary matters and refine the
proposals. “People who can’t come to the fo-
rums can participate online,” says Tillmann.
The delegates discuss the proposals with the
city council, which then decides on the appro-
priate measures. “The completed budget plan
is presented to the micro-regions, and resi-
dents elect representatives who monitor the
implementation of the projects,“ Tillmann ex-
plains. Almost 5,000 measures in sectors such
as wastewater treatment, healthcare, and edu-
cation have been approved by citizens and
then implemented since participatory budget-
ing was launched in 2001. “Problems affecting everyone must be
solved by everyone,” declared Swiss author
Friedrich Dürrenmatt in his play The Physicists.
Today, this statement seems more relevant
than ever before.Hülya Dagli
Pictures of the Future | Spring 2012 5352 Pictures of the Future | Spring 2012
Ortwin Renn, 61, is a Professor of Environmental Sociology and Technology Assessment at the University
of Stuttgart and Director of the Interdisciplinary Research
Unit for Risk Gover nance and
Sustainable Technology Development. He has also
been an Adjunct Professor of
Integrated Risk Analysis at Stavanger University, Norway
since 2007 and a Contract Professor at the Harbin Insti-
tute of Technology and at Beijing Normal University since
2009. Renn is a renowned mediator and advisor for
processes that resolve contro-
versial issues with the help of citizen participation.
Why Citizen Participation Is on the Increase Worldwide Is there a global trend toward citizens demanding more participation rights in
issues affecting their communities?
Renn:More and more people are living in
densely populated areas around the world,
which means th
ey’re becoming increasingly
dependent on one another. The actions of
each person affect everyone else. Infrastruc-
ture projects are often marked by a conflict of
interest between those who benefit and those
who bear the risks. The latter ask themselves
why they should suffer disadvantages when it’s
only the others who profit. Another problem is
that even experts often disagree on a project’s
goals and details. As a result, their knowledge
becomes useless in mediation, as each one fo-
tions, with leeway for changes and new ideas.
Simple yes-or-no decisions usually aren’t con-
ducive to a participatory process. Anyone look-
ing for simple approval shouldn’t get involved
with citizen participation, which by definition
means shaping the decision-making process.
Ultimately, it’s a question of how you view hu-
man nature. If you think people are only inter-
ested in their own personal advantage, you’re
going to be skeptical about citizen participa-
tion. But if you think people are generally ca-
pable of keeping their eyes on the big picture,
if you give them time to think and reflect, and
if you provide them with the knowledge they
need, then you’ll conclude that participation
offers great opportunities. I go by what Lao
Tse said: “Tell me, and I’ll forget; show me, and
I may remember; involve me, and I’ll under-
stand.”
Which citizens should get involved in par-
ticipatory processes?
Renn:That depends on the situation. If the is-
sue is local, y
ou should bring in the people
who are directly affected. But if y
ou’re talking
about issues on a broader scale, it’s better to
choose people who don’t represent either side
and can impartially consider and evaluate all
the arguments, like a jury in a trial.
How do you select citizens for participa-
tion in your own projects?
Renn:In one of the three ways. We either in
vite representatives of the af
fected groups, ask for volunteers, or select people at random
from the affected area. Sometimes we com-
bine the three options. It makes things easier,
of course, if the participants are open to learn-
ing new things and aren’t simply there to de-
fend their own position at all costs.
How would you describe a successful par-
ticipatory process?
Renn: Success doesn’t depend on whether or
no
t a measure is ultimately implemented. Fair-
ness pla
ys a major role. Everyone should be
given a chance to participate, and all citizens
should have the same rights and obligations.
Especially if the issue is complex, we have to
make sure everyone has the same level of
knowledge. That’s why we start out with in-
formational events. Participation only makes
sense if governments give citizens a certain
amount of freedom of action and make sure
that recommendations are implemented. Fi-
nally, the costs and benefits of the process
should be in a reasonable ratio. Will the Internet simplify participatory
processes in the future?
Renn:Yes and no. Social networks make it
pos
sible to organize such processes mor
e
quickly and reach a broader range of people.
But virtual forums can never replace personal
dialogue, because discussions usually get very
dynamic and complex and you can structure
the situation better with direct encounters.
This is very important when you’re trying to
make balanced judgments. What’s the future of citizen participation
on the international level?
Renn:The OECD countries will expand their
use of par
ticipatory processes in which citizens
weigh cert
ain options, examine potential con-
sequences, and finally make recommendations
to governments. In countries such as China,
the emerging middle class will increasingly de-
mand participation rights, and it remains to be
seen how this will be carried out within the
framework of the existing political system.
Can Germany learn from the experiences
of other countries?
Renn:Yes, of course. We can learn from
Switzerland, f
or example — but countries like
Brazil also have good ideas. The impor
tant
thing is for all parties to come to the table in
good faith and to have clearly defined areas of
responsibility, a clear and structured process,
and professional support.
Let’s say its 2020 and that most of the
4,000 kilometers of power transmission
lines needed to expand the German grid
have been built. How did it get done?
Renn:If that happens it will be because the
common good has trium
phed over selfish-
ness. Such an outcome would indicate t
hat
the majority of people realized the measure
had to be carried out if the desired energy
transformation was to be achieved. Communi-
ties affected by this would probably have to be
brought into the process early on, and the au-
thorities would have to listen to what they
have to say. But in view of the current time
pressure, it won’t be easy to make this vision a
reality.Interview conducted by Hülya Dagli
Mastering Complexity | Interview
which waste disposal experts evaluated the cri-
teria and made their own recommendations.
The results were presented to the citizens. “The four citizen commissions organized
separate workshops for the final assessment of
the proposed sites,” says Renn. “The evalua-
tions of the possible sites according to the cri-
teria were discussed in small groups and in a
plenary session. Finally, each site was put to a
vote.” One site, known as Eriwies, received the
most votes in each of the groups. Five mem-
bers of each commission were then selected to
form a “Super Commission” to align the recom-
mendations and forward the results to the au-
thorities in the form of a citizen report. “At the
beginning, 80 percent of the members be-
lieved their own municipality was not suitable
for the waste disposal plant,” Renn says. “But
by the end of the process, even the people
from Eriwies were saying the facility should be
built there.” The entire procedure took approxi-
mately two years, and the municipal govern-
ment agreed with the decision the citizens had
made.
Brazil: Home of Participatory Budgeting.
These days the scope of citizen participation
has expanded beyond major projects into a
realm previously considered untouchable: the
budget. “Participatory budgeting,” which got
its start in Brazil in 1989, is now a welcome ve-
hicle for citizen participation in Europe as well.
This process, which gives citizens a say in the
distribution of public funds, can take many dif-
ferent forms. The Brazilian port city of Recife,
which has a population of 1.6 million, received
the 2011 Reinhard Mohn Prize from the Ber-
cuses on the things he or she considers useful.
In many cases there’s a discrepancy between
the risks calculated by specialists and the risks
subjectively perceived by the public. Public mis-
trust then grows if no one addresses this prob-
lem. Many people also feel their lives are being
governed by elements beyond their control, so
they try to defend themselves against every-
thing they believe is being forced upon them.
Finally, the desire to participate in decision-
making processes, especially those that affect
one personally, increases in line with the edu-
cation and economic affluence of the individ-
ual in question.
Do we need to have a public counter-
weight to parliaments? Renn:Germany, like almost all representative
democracies, has done w
ell with the system it
has. Howev
er, our political system is often un-
able to deal with situations where decisions af-
fect people personally. Those who are impacted
by decisions usually don’t see their interests be-
ing considered, nor do they understand why
particular decisions are made. That doesn’t
mean we need to get rid of parliaments, but it
would make sense to have direct citizen partici-
pation, especially in local matters. This is not a
counterweight — it’s actually a win-win situa-
tion. Citizens can be heard and politicians can
count on more public support for projects that
have a solid democratic foundation. Dialogue
creates transparency; it allows affected citizens
to communicate their wishes to decision-mak-
ers and clarify open questions. Citizen participa-
tion processes allow people to become involved
and work together to develop solutions. Is participation a cure-all in terms of public
acceptance? Where does it make sense to
use it — when the issue is a local wind
park, in major infrastructure projects, or
with decisions that affect entire countries,
such as whether or not to remain in the
euro zone?
Renn:The more complex the world becomes,
t
he more people focus on what they’r
e famil-
iar with and think is valuable and important.
That means any change affecting oneself or
one’s immediate environment will initially be
questioned. At the same time, you have to
provide citizens with information about com-
plex issues. It’s important that every participa-
tory process be started without any precondi-
The citizens of Recife, Brazil, have had a say in their city’s budget for ten years. Today, citizens participate in decisions concerning that holy of holies: the annual city budget.
Pictures of the Future | Spring 2012 55
By contributing to all the stages of the value chain, Corporate Technology — Siemens’ global research unit — is helping the company gain and maintain a technological lead over its rivals.
Siemens’ latest gas turbine has an efficiency of
60.75 percent in combined-cycle operation together with a steam turbine. The turbine was developed by experts from the company’s Energy Sector and Corporate Technology.
How Research Strengthens Siemens
54 Pictures of the Future | Spring 2012
CT can support development work from ini-
tial idea to pilot product or technology. The
unit has experts for materials, electronics,
mechatronics, sensor systems, software, man-
ufacturing, testing techniques, and analytical
systems. It also employs process specialists,
who are networked with other experts at
Siemens’ Sectors.
It is this combined expertise that enables
Siemens to master even complex new systems
such as gas turbines that exhibit record-break-
ing levels of efficiency. “This ability is of crucial
strategic importance to an integrated technol-
ogy company such as Siemens,” says Klaus
Helmrich, Siemens’ Chief Technology Officer
and Head of Corporate Technology. “It enables
the company to not only remain competitive in
a wide variety of markets characterized by
A
gas turbine that weighs several hundred
tons may not seem to have much in com-
mon with organic light-emitting diodes, gear-
less wind turbines, or electric mobility systems.
But it does. All of these technologies are ex-
pected to become highly innovative segments
of major future markets. And Siemens is lead-
ing the way forward technologically in these
fields. What makes this possible is a vast net-
work of experts from a wide variety of compa-
ny departments around the world.
A key role is played here by the Corporate
Technology (CT) global research unit, which
encompasses a spectrum of technology fields
and so-called “lighthouse projects.” Hardly any
other company in the world conducts applied
research on such a broad front as does
Siemens. Mastering Complexity | R&D’s Value Add shorter and shorter innovation cycles, but to
actively shape these markets as well.”
Working with the Best Partners. As shown
in the accompanying boxed texts, Corporate
Technology covers the entire innovation value
chain, from research, development, produc-
tion, and manufacturing to the testing of pro-
totypes and products. CT can encompass this
broad range of tasks for two reasons. The
unit’s approximately 2,000 researchers and
4,000 software developers work closely with
the other 23,000 employees at Siemens busi-
nesses who are involved in research and devel-
opment; in addition, they collaborate with a
wide variety of universities and research insti-
tutes worldwide. In this way, the company in-
tegrates its projects at locations where the best
A Record-Breaking Gas Turbine with Clockwork Precision When combined with steam turbines, gas turbines are the greenest fossil-fuel-based power
generation systems.Because combined-cycle power plants can be quickly ramped up to supply elec-
tricity in a flexible manner, they ideally supplement renewable sources of energy. Boasting an efficiency
of 60.75 percent in combined-cycle operation, Siemens’ largest gas turbine is a record breaker. The power
plant’s output of 578 megawatts would cover the electricity needs of all of the households in Berlin. Although the turbine weighs as much as a fully fueled Airbus A380 jet, its parts operate with clock work
precision. Some 750 researchers, engineers, and skilled workers from all over the world required over ten
years to develop the turbine. Corporate Technology (CT) contributed extensively to the project.
Research.CT’s ceramics experts have conducted research into new, robust materials that can be used in
the heat-insulation layers on turbine blades. They have used specialized testing methods and simulations
to analyze the behavior of different materials in the turbine’s hot gases and to determine the system’s
permissible load limits. This has enabled partners in the Energy Sector to increase the gas turbines’ oper-
ating temperature by about 150 degrees Celsius and its efficiency by around 1.5 percentage points. At
the same time, by developing neural networks and forecasting models, CT experts in machine learning
have helped to reduce emissions of nitrogen oxides and carbon monoxide. This makes the turbines more
environmentally friendly and cuts the cost of scrubbing exhaust gases.
Development.Using a model-based design approach, CT has conducted a variety of simulations and
implemented optimization measures to improve the development of gas turbines. Algorithms were em-
ployed to optimize the aerodynamics of the turbine blades. CT has conducted thermo-acoustic simula-
tions of pressure fluctuations to reduce the mechanical
strain caused by combustion instabilities in the combus-
tion chambers. What’s more, using simulations for study-
ing the service life of turbine blades, it has been possible
to make the blades more robust. Along with other experts,
sensor specialists from CT also continuously monitor the
interior temperature of gas turbines and measure nitrogen
oxide emissions. This has to be done if the turbines are to
be run under optimal operating conditions. By visually
measuring exhaust gas temperatures, specialists support
the gas turbine retrofitting business. Before a turbine’s ef-
ficiency can be boosted through a variety of optimization
measures, experts have to make sure that no part of the
system will overheat.
Manufacturing.CT experts have played an important
role in the development of a welding technique that saves
time and material through automation, while also improving the quality of welded joints. Their laser
welding expertise could also prove useful when it comes to repairing turbine blades. In addition, another
technique could make it easier to reuse blades. Here, all deposits have to be removed before a turbine
blade can be restored. Highly concentrated hydrochloric acid is currently used to do this. However, it is
easier and less expensive to use an electrochemical technique for which CT owns the patents. What’s
more, this method can be performed in a more controlled manner and reduces the risk of damage to the
blades during the decoating process.
Testing.Together with partners at the Energy Sector, experts from CT have developed a platform for the
non-destructive testing of turbine blades. During various inspections, the blades’ condition is evaluated
over their entire life cycles. The resulting statistical data can flow into the system’s future design and be
used to help optimize the existing concept. Production experts also use this system to inspect delivered
blades. Energy’s service teams can also keep an eye on the gas turbines during operation. To monitor the
system in real time, CT researchers have developed a powerful tool called Seneca, which evaluates the
data recorded in the gas turbines by thousands of sensors. In addition to pressure, these sensors monitor
temperature, vibrations, and many other factors. Each second, Seneca transmits about 5,000 values
from each gas turbine to 100 computer centers around the world. The online system compares 500 to
1,000 behavioral models with one another and displays any deviations from the norm as a graph.
partners are available. For example, Siemens
has set up Centers of Knowledge Interchange
(CKI) at eight renowned universities, including
the University of California at Berkeley, Ts-
inghua University in Beijing, the Technical Uni-
versity of Munich, and the RWTH in Aachen,
Germany. These universities conduct research
in areas that are of special strategic impor-
tance to Siemens.
At the RWTH in Aachen, for example,
Siemens will be contributing €6 million over
the next four years to fund research into scarce
raw materials and ways of mining them in an
environmentally friendly manner (p. 107). The
company is also pursuing other approaches
aimed at reducing our dependence on poten-
tially critical raw materials. These efforts in-
clude research into new recycling methods and
Gearless Wind Turbines Robust, wear-free, low-maintenance turbines provide offshore wind power plants with a cru-
cial competitive edge.Siemens offers gearless wind turbines (see pictures below). Instead of complex
mechanical systems, such turbines have a generator with a permanent magnet that converts motion di-
rectly into electricity. Corporate Technology (CT) made important contributions to the development of
the first gearless 3.1-megawatt wind turbine. For example, CT experts conducted 2D and 3D simulations
during the generator’s design phase and created a digital prototype. This enabled a cross-sector team to
minimize the air gap between the stator and the generator’s rotating part, leading to less power loss
while ensuring maximum stability. In cooperation with experts at the company’s operating units, CT used
other 3D models to design the cooling system and integrate it into the generator. To ensure manufactur-
ing would be as cost-efficient as possible, specialists at CT also developed an assembly design for mount-
ing and insulating the magnets in a manner suited to series production. These measures halved the gen-
erator’s manufacturing costs and reduced the 3.1-MW turbine’s weight from 73 tons to about 50 tons.
Together with the nacelle and the rotor, the Siemens 6-MW-system weighs around 350 tons overall, mak-
ing it the lightest turbine of its kind on the market.
CT production experts created a modular factory
concept in accordance with the principles of the
Siemens Production System (Pictures of the Future,
Fall 2011, p. 98) for the final assembly of the gener-
ator. Production is very flexible and optimized in
such a way that manufacturing times have been
halved to less than 850 hours, compared to the pro-
totype. CT also tested the generator’s cooling sys-
tem to ensure that it worked properly before series
production commenced.
Luminescent Plastics In conjunction with their sister systems — LEDs — organic light-emitting diodes, or OLEDs (pic-
tured above), will serve as the main source of artificial light in the future. OLEDs consist of extremely thin
plastic films that light up when electricity flows through them. At the end of 2009, Siemens subsidiary Os-
ram launched Orbeos — the first commercial OLED light tile. From the very start, Corporate Technology
(CT) was involved in all stages of the new technology’s research, development, production, and testing. The
first prototypes were created more than 15 years ago in Germany in an Erlangen clean room lab, which con-
tinues to produce small batches of OLEDs and subsequently tests their quality. Experts at CT developed the
first OLED components and production processes — particularly those used to synthesize and work the plas-
tic. Researchers also worked on creating flexible OLEDs and ways of efficiently encapsulating the air- and
humidity-sensitive systems . More recently, they have been striving to develop dopants that reduce material
costs and therefore make OLEDs more competitive. In 2011 Osram announced that it had created an OLED
whose levels of efficiency set new records. To this end, Osram used an inexpensive dopant from CT. In an-
other project, experts from CT are currently researching special substances that could help to improve
charge transfer.
Electric Mobility Over the past four years, the eCar lighthouse project at Corporate Technology (CT) has been
making major contributions to the advancement of electric mobility.The most recent Siemens development is a hybrid-electric aircraft that completed its virgin flight in summer 2011 (Pictures of the Future, Fall 2011, p. 7). Essentially a glider, this aircraft is powered by a Siemens electric motor. The battery
is charged by a small combustion engine that always operates at an optimal level, thus cutting the plane’s
fuel consumption and emissions by around 25 percent compared to what it otherwise would be.
Research.In cooperation with the automaker Ruf, experts at CT have built electric sports cars on the basis
of a Porsche 911. Using a unique test rig (bottom picture on this page), experts can analyze and improve
the behavior of the motors under conditions relevant to real-life use. This spring (2012), specialists installed
two high-performance, high-torque wheel hub motors into a Roding sports car for the first time. These
“smart wheels,” which function as a drive system and brakes (p. 74), contain a motor, power electronics,
and a control system. The use of an additional brake circuit enhances safety. The two motors enable the
system to drive each wheel separately. Researchers are also developing a new communications architecture for automobiles (top picture). New infotainment and driver assistance functions are
only to be installed as software, irrespective of the hardware used. Together with BMW, CT researchers have developed a system that uses magnetic induction to charge a BMW ActiveE
through a plate on the ground, without any direct vehicle contact. Such wireless charging is almost as efficient as charging with the help of cables, besides being more convenient. In other
words, it could increase people’s acceptance of electric vehicles. Development.To ensure inductive charging can be easily performed, the system must help driv-
ers put their vehicle into the right position and “know” when the charging process can begin. To
make this possible, CT experts have developed a large number of wireless transmission compo-
nents that perform several tasks. For example, they “wake up” the charging system; fine-position
the vehicle; transmit data; and monitor the air gap, which is several centimeters wide, during the
charging process. CT researchers have also developed an extremely high power-density power
train. Consisting of a converter, a motor, and a control system, it has been installed into a variety
of vehicles. During acceleration, the prototype motor generates 125 kilowatts for 30 seconds and
produces a maximum torque of 230 newtonmeters. The motor has a continuous output of 60 kilo-
watts. To design the system, the researchers used tools to simulate the complex interactions be-
tween the associated electromagnetic fields, thermodynamic processes, and mechanical structural
strength. The power electronics used to drive the vehicle are also employed to charge it. Special-
ists are also using new concepts to triple the electric motors’ power density, while energy experts
are developing charging hardware. So far they have improved the converters’ efficiency and sim-
plified the production of the power electronics. In addition, energy storage experts have devel-
oped a simulation model that predicts the operating performance of lithium-ion batteries. In addi-
tion to enabling users to determine their battery’s potential performance at any time, the model
also depicts the battery’s thermal behavior in a variety of scenarios. CT researchers are also devel-
oping new materials for magnets that require little or no rare earth elements. Moreover, they intend to use
recycling technologies to salvage these valuable materials. CT’s PLM experts are optimizing manufacturing
processes so that electric motors can meet the demands of the automotive industry.
Manufacturing.The biggest cost factor in electric cars is the battery. The only way this cost can be signifi-
cantly cut is to improve power density and mass-produce the batteries. Siemens offers battery producers its
expertise in industrial automation. Researchers at CT can offer extensive expertise and knowledge of the
process automation that is needed to manufacture such batteries. In addition to coming up with an appro-
priate automation concept, they have also created a quality and process control system. Among other
things, this process involves applying pastes in very thin and nearly homogenous layers with minimal toler-
ance. This procedure has to be separately optimized for each manufacturer.
Testing.Experts at CT are running a number of projects to determine how people use and assess electric
vehicles under everyday conditions (Pictures of the Future, Spring 2011, p. 34). To this end, they also man-
age Siemens’ own test fleet. In fall 2010, the company loaned 20 small electric cars to employees, who
have been testing the vehicles. Since fall 2011, Siemens has also operated a car-sharing fleet in Berlin to
study how well electric vehicles are accepted by drivers and other issues.
alternative substances. To this end, CT
launched the Sustainable Materials Manage-
ment lighthouse project in October 2011. Oth-
er projects focus on biotechnology, electric
mobility, and thermal energy (p. 104).
With a view to discovering which issues the
company will be addressing in the future, CT’s
Technology & Innovation Management depart-
ment supports the strategic innovation
process. Together with chief technologists
from the Siemens Sectors, the department reg-
ularly analyzes new business opportunities in
order to determine their importance for the
company. The process uses information from a
range of sources, including the results of the
Pictures of the Future program, which serves
as Siemens’ strategic research tool for studying
Cities Sector is now testing at a utility company
in Germany (p. 46).
However, not all ideas and developments
from Corporate Technology are adopted by
Siemens. To ensure the solutions and resulting
patents can nevertheless be used, CT also
launches technologies on the market by estab-
lishing spin-off companies such as EnOcean.
The latter was established around ten years
ago to produce wireless sensors that garner
their own power for buildings and industrial fa-
cilities. These miniaturized energy transducers
are now being used in more than 200,000
buildings throughout the world. In the future,
CT will also be able to create its own start-up
companies with business models that make
them potentially interesting for Siemens Sec-
tors — even though they have not yet been as-
signed to a Sector because the ideas are still at
an early stage of development.
Only by taking such a broad approach can
Siemens’ global research unit remain at the
forefront of innovation cycles and help shape
an appropriate technology strategy for the
whole company. “CT has to perform three basic
tasks,” says Klaus Helmrich. “It has to secure
the technological basis on which Siemens is
founded, shape tomorrow’s world technologi-
cally, and strengthen the integrated technolo-
gy company by generating synergies on as
broad a scale as possible.” Only if it succeeds
will Siemens be able to continue to build on
one of its key pillars: its innovation-driven
competitive edge.Norbert Aschenbrenner
future developments. Potentially disruptive
technologies, which may be capable of revolu-
tionizing entire markets when combined with
new business models, are analyzed in depth
during the innovation process. Subsequently
they are set up as CT lighthouse projects, for
example, following management approval. In each case, the goal is that such projects
will migrate to one of Siemens’ operating
units. The Industry Sector, for example, is striv-
ing to convert surplus electricity from renew-
able sources into hydrogen fuel on an industri-
al scale (p. 100). The idea of running a PEM
fuel cell in reverse to achieve hydrogen elec-
trolysis was originally conceived at CT. Similar-
ly, the CT Smart Grid lighthouse project has re-
sulted in software that the Infrastructure and
Pictures of the Future | Spring 2012 5756 Pictures of the Future | Spring 2012
Pictures of the Future | Spring 2012 59
New products make it in the marketplace only if their complexity is invisible and customers can use them quickly and intuitively. At Siemens, usability experts are working with electric car users to make tomorrow’s electric vehicles as easy to recharge as launching an app on a smartphone. In the future, drivers of electric cars will be able to use a smartphone to see how much mileage they get from a charge and what it costs. Klaus Orsolleck (right) recharges his car. Keep it Simple!
58 Pictures of the Future | Spring 2012
Laboratory in Munich, and her job is to find out
what the user needs, when, and under which
circumstances. Her focus is on the car of the
future, and electric mobility is her specialty.
In addition to being environmentally friend-
ly, comfortable, and quiet, the electric car of
tomorrow will offer much more. Special soft-
ware will link it to charging stations, parking
spaces, and traffic management centers. It will
charge itself and automatically pay recharging
and parking fees. Furthermore, it will not only
store electricity, but feed it back into the power
grid when needed, earning money in the
process. “Until now, people have read their electrici-
ty meters once a year and been regularly
shocked by the bill,” says Dr. Heinz Martin
Scheurer, head of CT’s Usability Department.
“In the future, you’ll be able to use an app on a
smartphone to see how much money you’ve
earned by feeding power into the grid and how
much you have to pay.” Some of these features are already avail-
able. Electric cars that are compatible with
A
ccording to a Russian proverb, wisdom
and simplicity get along well. This was
clearly no secret for legendary aerospace engi-
neer Sergei Pavlovich Korolev, who ushered in
the age of space flight with Sputnik 65 years
ago. “The genius of a design lies in its simplici-
ty,” he said. This credo is also guiding researchers at
Siemens Corporate Technology (CT) as they
deal with the issue of usability. Today, hardly
any Siemens product reaches the market with-
out having been tested in this respect.
Siemens’ teams of user-experience specialists,
including engineers, designers, and psycholo-
gists, test electric cars, visit power plants,
stand next to physicians in the operating
room, and invite test subjects to try out appli-
cations (apps) and Internet pages — all with
the aim of making products as easy as possible
to use. How can a product be both highly complex
and yet easy to use? “Simple,” says Anke
Richter. “You just have to think like a user.”
Richter, a psychologist, works at CT’s Usability
Mastering Complexity | User-Friendliness
Federal Ministry for the Environment (Pictures
of the Future, Fall 2009, p. 44 and Spring
2010, p. 92). Renewable sources of energy
contribute more than 60 percent of the power
supply in the Harz region. She accompanied
drivers of electric cars throughout the region in
order to study their habits, such as when,
where, and how they charge their cars. She
watched a mobility provider in a control room,
looked at the entire charging infrastructure,
and observed a parking garage operator who
was considering whether to invest in charging
stations. In discussions with experts, she
worked out how charging stations could be re-
served through a Web portal and what access
rights would be needed. nology, and you don’t know whether it will be
accepted by customers,” says Scheurer. But if
people and technology are coordinated, errors
can be reduced and effort can be spared. In
other words, efficiency increases. However, features are often simply lined up
in a row, particularly in software development
and user interface design. “And that,” says
Richter, “is like attaching the handle to the
spout on a coffeepot. Theoretically, all the fea-
tures are there to enable you to lift the pot and
pour the coffee, but they are in the wrong
places.” In any case, compared with the situa-
tion ten years ago, user interface design — in
other words, the way software appears out-
wardly to the user — is now accorded much
more importance and is quickly becoming an
increasingly significant competitive factor,
adds Scheurer. Gestures Instead of Clicks. Although it’s be-
coming easier and easier to write software, the
information and features offered to the user
through software are becoming increasingly
complex. Experts at Siemens’ Usability Labora-
tory therefore focus on software-user inter-
faces. This can really pay off. For instance,
Siemens’ Syngo.via imaging software was hon-
ored with the iF Design Award in 2010. The
software helps doctors to accelerate patient
appraisals and improves the efficiency of clini-
cal management.
At the moment, the “mouse generation” is
still dominant, says Scheurer. But in the future,
he expects multi-touch control — the detec-
tion of several fingers on a touch display — to
become increasingly widespread. And those
looking even farther into the future are imag-
ining systems that can be controlled through
voice commands, gestures, glances, or even
“brain computing,” where the system registers
a user’s thought processes via EEG measure-
ment. In fact, Siemens has already developed a
gesture control system for the operating room
(Pictures of the Future, Fall 2011, p. 74). Meanwhile, Klaus Orsolleck is imagining
what it will be like, maybe ten years from now,
to conveniently control his electric car from his
couch. “The app on the smartphone will auto-
matically synchronize with my Outlook calen-
dar and tell the car when it’s time to recharge.
Half an hour before departure, my car will not
only be fully charged but also warmed up.”
Nothing could be simpler. Silke Weber
droid smartphones, and Orsolleck is trying it
out in a usability test. At the moment, he’s sit-
ting behind a glass panel in a Siemens lab in
Munich. A usability expert sitting next to him is
giving him a task to complete: “You’ve driven
to a charging station at the company parking
lot, and you’d like to fully charge your car as in-
expensively as possible while you work. You’d
be willing to accept a longer charging time for
that. What do you do?” Using an icon on the smartphone, Orsolleck
launches the phone’s eMobility Manager. A
window opens, and he can now select a charg-
ing station. So far everything has been very in-
tuitive. Then a window with charging options
appears: “Fast,” “Profile” (user-defined), and
recharging stations, billing stations, and the
electrical grid already exist in some areas. Pio-
neers of electromobility, such as Siemens em-
ployee Klaus Orsolleck, are testing the new
cars to see how fit they are for daily use and
which features still need improvement (Pic-
tures of the Future, Spring 2011, p. 34). For ex-
ample, one thing that Orsolleck noticed — and
passed on to Richter — was that it’s difficult to
tell whether his electric car is charging at any
given time, because the small blue charging
display is hidden up front under the radio in
the dashboard. And at charging stations
there’s still no indication of how much power a
vehicle has stored. In any event, Orsolleck would like to be able
to check the charging process from work or
take a quick peek while shopping. He’d also
like the option of remotely choosing either in-
expensive, environmentally friendly power or a
fast-charge mode, in case he suddenly needs
the car sooner than expected. Richter incorporated these preferences into
her design for the new charging app for An-
the inexpensive green “Eco” electricity. Orsol-
leck chooses the latter. With the three slide
controls underneath the options, he can adjust
the charging time, the charge level in kilome-
ters, and the cost. While using the app, Orsol-
leck comments on each individual step as the
usability expert notes any hesitation, no mat-
ter how small. In a new window, under “Ad-
vanced Options,” Orsolleck selects “Allow re-
verse feed” and taps on his “Preferred energy
mix: water, wind, solar.” Meanwhile, a camera
films every movement of his hand and a pro-
gram records every click as he uses the app.
With this procedure, experts at the lab can
carefully analyze the user’s behavior. Detecting Habits. “Focusing on the user isn’t
enough by itself,” says Richter. “All of the asso-
ciated elements, scenarios, and participants in
the charging, parking and billing infrastructure
have to be understood and included.” To that
end, she paid a visit to the Harz Model Region,
a project funded by the German Federal Min-
istry of Economics and Technology and the
From these observations, she
figured out which features users
want to see displayed on their
app when they charge their cars
and which functions have to run
in the background. “This is the
key issue,” she says. The driver doesn’t have to
see a charging curve; it’s enough if a “charging
profile” negotiated by the car with the charg-
ing station is running in the background.
What’s important for the user is that he can see
the battery’s current state of charge from any-
where by using a mobile app and that he
knows how long it will take to complete the
charging process. From the materials she stud-
ied, Richter and her colleagues created an in-
teractive model that formed the basis of the
prototype that Orsolleck was allowed to test. Richter says that it’s important, especially
with innovative products, to ensure that every-
thing you can conceive of technically is visual-
ized in prototypes early on so that it conforms
with the behavior of potential users. “If you
don’t do that, all you have in the end is tech-
The “mouse generation” will soon
give way to multi-touch displays
that detect several fingers.
Pictures of the Future | Spring 2012 61
Siemens researchers have developed a software platform that allows them to simulate construction projects and their impact (left) on traffic and transportation systems, city power grids, and quality of life.
60 Pictures of the Future | Spring 2012
priate responses. CLM offers urban planners a
simple way to see the potential consequences of
their decisions. It also allows the easy develop-
ment of alternative “what if…” scenarios such as
changing a two-way street into a one-way street,
making a building taller, or using photovoltaic fa-
cilities to improve a neighborhood’s energy bal-
ance. This opens up new possibilities for address-
ing complex urban planning issues in a simple
and intuitive manner. The interrelationships between a city’s eco-
nomic, environmental, and social goals are often
extremely complex. For example, which is bet-
ter: promoting the use of electric
vehicles or expanding the public
transport network? If you
choose the former option, you
won’t reduce traffic congestion
but you will lower carbon diox-
ide emissions — but even that is
only true if the power grid sup-
plying the electric vehicles delivers energy from
renewable sources. This, in turn, requires a high-
performance grid, which in some cases first has
to be built and must include battery-charging
stations. If, on the other hand, you choose the
public transport option, you have to be sure
there are enough incentives for people to use it.
All of this is too complex for any one person — or
even many city governments — to evaluate. But
it is no problem for the CLM platform. “Although
our models don’t offer exact predictions,” says
Wachmann. “they are 80 percent accurate. This
enables them to provide a solid foundation for
T
he screen shows a satellite picture of the
U.S. Dr. Bernd Wachmann, head of the “Sus-
tainable Cities” project at Siemens Corporate
Technology (CT), zooms in on a meadow just
outside Princeton, New Jersey. With a few clicks,
he inserts two office buildings into the image.
He plots the ground plan, adds a parking lot and
access roads — and the complex has taken
shape in the virtual realm. As Wachmann does
all this, a bar under the images he generates de-
livers data, such as the buildings’ energy con-
sumption at different times of the day and year,
how photovoltaic systems could improve their
energy balance, how many people could work in
the buildings, how their activity would impact
traffic flows and the power grid, the amount of
waste and air pollution they would produce, and
what the expected operating costs would be.
“Those are just a few of the parameters we simu-
late,” Wachmann explains. “The list can be ex-
panded to include things like pedestrian-friendli-
ness, the effects of electric vehicles on a project’s
energy balance, and even quality of life. All of
these aspects can be quantified and therefore
modeled.”
The software platform Wachmann uses for
this is part of the City Life Management (CLM)
project developed by CT scientists. The CLM plat-
form comes from Princeton and Munich, city
data is evaluated in Berlin and Vienna, and Mu-
nich is responsible for infrastructure expertise.
The project develops and offers solutions for
viewing cities holistically, simulating the long-
term impact of changes, and formulating appro-
entire value creation process much more effi-
cient. Use of this innovative technology has led
to extensive cost savings, shorter development
and production times, and greater productivity
in the automotive industry (Pictures of the Fu-
ture,Fall 2011, p. 94). However, until recently,
it had not been used very much in urban plan-
ning applications. Still, Thomas Gruenewald,
Project Manager for the CLM Platform at
Siemens CT in Princeton, believes that a skill-
fully programmed platform for planning major
infrastructure projects could result in similar
successes and would also make it possible to
promote sustainability in cities.
At the moment, CT experts are focusing on
the planning phase for urban infrastructure, an
area where there’s plenty of room for improve-
ment. According to Dr. George Lo, Senior Prin-
cipal at CT in Princeton, 75 percent of the deci-
sions that determine the lifecycle costs of a
building are made before detailed plans be-
come available. Moreover, a study conducted
by the University of Texas in Austin found that
57 percent of the time invested in most con-
struction projects is wasted because initial
drafts often need to be altered. In other words,
those who wish to design sustainable urban
construction projects that meet budget and
schedule targets should make their decisions
during the drafting phase. The development of the CLM Platform was
helped by the fact that the company has many
years of experience in planning, building, and
operating water, wastewater, and energy sup-
decision-making for a range of organizations,
such as municipal agencies, politicians, citizens’
initiatives, and local residents.” There are no quick fixes for entities as com-
plex as cities, and areas of friction are sure to
arise. As soon as plans for a new industrial park
or a new urban district are announced, govern-
ment agencies and citizens begin addressing the
potential impact. After initial plans are drawn up,
they pass through many — building depart-
ments, utility companies, economic and environ-
mental management offices, architectural bu-
reaus, and energy suppliers. The plans are also
usually made available for public viewing at gov-
ernment agencies. An online platform such as
CLM can save project planners a lot of trouble —
particularly if a project is contentious. Under
such circumstances, appropriate citizen partici-
pation plays a key role (p. 50).
Digitally Modeling Cities. CLM was modeled
on industrial solutions for product lifecycle
management (PLM), which centrally manages
all data on product development, production,
warehousing, and sales. This approach not
only increases transparency but also makes the
Urban Genome Project Could Spawn New Picture of Cities In order to conduct their Green City Index series of environmental studies, Siemens and the Economist
Intelligence Unit (see p.7 and www.siemens.com/greencityindex) had to analyze a huge amount of het-
erogeneous data and a large number of surveys. Moreover, since then more and more information has
been posted at websites operated by cities such as Vienna, London, and Berlin, with the data covering
everything from energy and the economy to art and culture. There’s so much data out there, in fact, that
sustainability expert Jonathan Fink from Arizona State University believes the time has come to decode
the “urban genome.” That’s easier said than done, though, as freely available data on a city’s socioeco-
nomic and environmental development continues to be organized on the basis of sectors such as trans-
port, healthcare, and demographics. What’s more, the information often displays great differences in
terms of its quality, quantity, granularity, and thoroughness. Siemens experts are now examining ways
to collect, integrate, and interpret such data more rapidly as part of the company’s “Sustainable Cities”
lighthouse project at Corporate Technology (CT). Available at the moment are simple, and in many cases
open, programs based on data released by cities. These programs allow users to call up the current traf-
fic situation or find out where they can drop off old clothing or glass recyclables. More important than
that, however, is the ability to quickly present a clear overview of life in a city — whether in terms of its
energy balance or in relation to its demographic or social developments. “The challenge is to develop a
coherent and complete picture of a city from diverse data sources and various degrees of temporal and
spatial resolution,” says Dr. Axel Polleres, a computer scientist at CT in Vienna, Austria. “This effort will
eventually be supported by binding reporting standards as cities become increasingly networked with
one another.” A useful tool now being developed by Dr. Stefan Kluckner at CT in Graz, Austria employs
state-of-the-art image processing technology to convert conventional digital 2D images into 3D models
of entire urban districts. The system records relevant scenes from overlapping viewing angles and differ-
ent points in time and then uses automated methods to combine them into a single 3D depiction. The
goal here is to use such spatially and temporally arranged data sets to help future automated analysis
programs display the current conditions in a city and subsequently use the depictions as a basis for city
models and simulations. This would make it possible, for example, to create a dynamic and continually
updated Green City Index. Urban infrastructures — whether for traffic and transport, energy, or buildings — are generally interlinked in many ways. As a result, even minor changes can have significant consequences. A software platform from Siemens makes it easier to manage the complexities of urban planning.
City in a Digital Nutshell
Mastering Complexity | Urban Planning
A new software platform can help
cities predict the consequences of complex planning proposals.
Pictures of the Future | Spring 2012 6362 Pictures of the Future | Spring 2012
Energy Independent Buildings? Just Visit “The Crystal” Siemens has invested some £30 million in its new knowledge and dialogue center for urban sustainabili-
ty in the Royal Victoria Docks section of London. Know as “The Crystal,” the center will open in the sum-
mer of 2012 and is expected to attract around 100,000 visitors per year. The complex will feature a
2,000-square-meter interactive exhibition that will highlight everything from building technology and
mobility to energy to water supply systems. A 270-seat auditorium will be used for presentations and
discussions. Experts from Siemens will work with partner organizations to establish and maintain a dia-
logue with architects, urban planners, municipal officials, schools, and students, and will also support
development projects. The center will offer a look at the environmentally-friendly buildings of the fu-
ture. Operated exclusively with renewable energy from solar cells and geothermal heat pumps, the facili-
ty will treat rainwater to make drinking water, and will purify wastewater before distributing it to plants.
The complex, which has been certified in accordance with the stringent international LEED and BREEAM
standards, boasts exemplary features such as electric vehicle charging stations that belong to the charg-
ing network operated by Siemens in the city. Power grids, data highways, and public transport networks are examples of complex infrastructures that need to be protected with sophisticated safety and security architectures.
Complex equipment, such as smart meters and the
trains that Siemens technicians test under icy conditions in climate chambers, must be monitored
for their susceptibility to threats from hackers.
Staying a Step Ahead of Hackers
their homes will send the data to the Internet.
But if hackers get into the central servers,
they’ll be able to tell when no electricity is be-
ing used in a house or apartment, thus tipping
them off when no one is home. Simulating Glitches. It’s not just the power
grid that’s becoming a highly complex system;
the same can be said of high-speed rail networks
and new subway lines with software-controlled
mechanical and electronic propulsion systems.
In such a situation, the failure of a single module
can affect an entire train. For example, if an elec-
tronic system doesn’t close the doors, it’s not
enough to simply shut them by hand. Other sys-
tems also need to know about the problem and
adjust their operations accordingly by issuing a
command that allows the train to leave the sta-
tion even though there’s no electronic signal in-
dicating that the doors are in fact closed. For
every conceivable scenario, experts have to
draw up a fault tree depicting the course each
functional error will take. Only after this has
been completed for every foreseeable contin-
gency can parameters be defined for responses.
“We used to have to develop a new fault tree
for every new train concept,” says Martin Roth-
felder, who is responsible for Risk Management
and Analysis at CT in Munich. A further problem
is the fact that each country has its own rail sys-
tem safety standards. For example, most train
O
n the hunt in Washington, D.C. The bad
guys are doing the chasing. They’re trying
to get a witness who is being guarded and es-
corted by police detective John McClane
(Bruce Willis). Things don’t look good for Mc-
Clane. The criminals chasing him and his wit-
ness have hacked into all the city’s computer
systems. They now control the transport net-
works, phones, and IT lines, which allows
them to watch their prey on giant monitors in
their command center as they change traffic
lights to red, close tunnels, and generate chaos
throughout Washington. “Live Free or Die
Hard” is every IT security expert’s nightmare.
Dr. Johann Fichtner, head of the IT Security
technology field at Siemens Corporate Tech-
nology (CT) in Munich, has seen the movie. He
Mastering Complexity | System Safety
door control systems in France are monitored
solely with electronic systems, while the UK rail
network generally uses an additional sensor-
based safety architecture that sends signals via a
bus system. As a result, it’s becoming more diffi-
cult to demonstrate that a system is fail-safe.
Rothfelder’s team used standard software tools
to develop a program that allows fault trees to
be used with subsystems. Technicians merely
have to key in the variables of a particular train.
The fault analysis is then carried out automatical-
ly. “We’re now able to determine much sooner
that a proposed solution isn’t safe enough, and
that the development team needs to consider al-
ternatives,” Rothfelder explains. Strategies designed to protect sensitive sys-
tems from attack are all basically the same. Spe-
cialists analyze the systems and the type of pro-
tection desired, define security requirements,
develop a suitable security architecture, and im-
plement it. According to Fichtner, the trend is
now to have secure programming technologies
tested and officially certified. CT’s Development
Centers, which are responsible for software de-
velopment, also offer continually updated secu-
rity training programs at their Central Eastern Eu-
rope and India clusters. One principle is
paramount here, says Fichtner: All systems must
be continually examined for new weaknesses.
“The idea that you shouldn’t touch a running sys-
tem is outdated.” Katrin Nikolaus
collects usage data from local transformer sta-
tions, monitors and manages the grid, sends
data to control centers, and stores it in soft-
ware that generates electric bills. All of these
functions and connections have to be secured.
Networks that already run with AMIS, like the
grids in Upper Austria and the German state of
Baden-Württemberg, are secured with soft-
ware encryption and protocols that precisely
define which module should transmit data and
where. “This offers a benefit, because if the
code is ever cracked by hackers it will only give
them access to certain parts of the network
and can then be quickly changed using a soft-
ware download,” says Schenk. New and ex-
panded security standards can also be added
as needed in such a system.
Another problem is that more and more
networks and industrial facilities are now run-
ning on standard operating systems and using
Web-based services, thus making them poten-
tially accessible from any PC. Because they’re
based on Windows or Linux software, they’re
also easy to service. “But that also makes them
more vulnerable than systems that use special-
ly developed software, given that hackers are
already familiar with the setup,” says CT expert
Steffen Fries. In the future, consumers will be able to use
Web applications to monitor their own electric-
ity consumption, because the smart meters in
and his team advise the Siemens Sectors on IT
security matters. “The film isn’t completely un-
realistic; theoretically, hacker attacks can shut
down entire infrastructures,” Fichtner says.
The more complex and interconnected the
control systems are in airports, public trans-
port systems, water and energy networks, hos-
pitals, and data networks, the greater will be
the danger that such a scenario can occur. The power grid in particular has to be pro-
tected, because many other infrastructures
rely on electricity. This is particularly crucial
with regard to smart grids, which will closely
link a large number of electricity producers,
power consumers, and software systems in the
future (p.46). International security-strategy
standards need to be developed and imple-
mented here. “You need to look at the entire
smart grid in this process, not just the connec-
tions between individual components,” says
Alexander Schenk, who is responsible for Auto-
mated Metering and Information Systems
(AMIS) at Siemens in Vienna, Austria. A smart
grid equipped with AMIS measures household
electricity consumption with smart meters,
ply systems, as well as transportation infra-
structures. “We can deal with such great com-
plexity because we know how to mathemati-
cally model the physical behavior of these
systems,” says modeling expert Tim Schenk
from Siemens CT in Munich. In addition,
Schenk and others are examining data now be-
ing made available by more and more cities
about their demographic structures and devel-
opment, energy consumption, and transport
requirements. The results can then be com-
bined with CLM to create realistic models that
give participants a look into realistic future sce-
narios. All of this amounts to a paradigm shift, as
planners can now see almost in real time how
their decisions in one area — for instance, the
height of a building — can impact things such
as local traffic or the energy balance in a
neighborhood. The CLM working group is now negotiating
with representatives from two major projects
in China and central Europe that plan to utilize
this technology for the first time.
Simulating Quality of Life. “But that’s just the
beginning,” says Wachmann. “At the moment,
we’re also working on using key performance
indicators (KPIs) such as energy consumption,
traffic and transport volume, and carbon diox-
ide generation to derive socioeconomic indica-
tors as well.” The socioeconomic indicators
Wachmann is referring to enable an assess-
ment of quality of life, economic development,
and more. To this end, Siemens researchers are
developing an estimation model based on ex-
pert opinions and statistical studies. Quality of
life assessments depend heavily on factors
such as wages, public safety, and living condi-
tions, but cultural conditions are also taken
into account.
Local factors such as building ordinances
and energy efficiency stipulations will also be
more precisely incorporated into the simula-
tions, as will factors that extend beyond local
boundaries. These might include global cli-
mate trends, for example, since future energy
consumption in buildings will of course also be
impacted by climate change. Demographic de-
velopments will be considered as well. After
all, if a neighborhood ages, this will increase
the need for things like sidewalks with wheel-
chair-friendly ramps and disabled-only parking.
“As long as the factors remain quantifiable,
we’ll be able to model them,” says Wachmann.
The potential offered by CLM doesn’t end
with virtual planning. Not only can it be used
to conceive new neighborhoods and redesign
cities for the decades to come, but it can also
help to manage buildings and neighborhoods
after they’re completed. A few mouse clicks
will then be all it takes for planners and citizen
groups to determine, for instance, how a
neighborhood’s demand for electric vehicle
parking and charging will change if a streetcar
line is added. Hubertus Breuer
Pictures of the Future | Spring 2012 65
Water is the only part of our diet for which there is no substitute. Yet it is being wasted in huge quantities. Relief may be on the way, however, as researchers close in on ways of using ultrasound and mathematics to simulate normal behavior in water networks and localize the sources of leaks.
Millions of liters of drinking water leak out of water pipes every day. Now, an ultrasound flow
meter can be used to investigate sections of water networks. At a control center, algorithms calculate the locations of the leaks.
Simulations that Localize Leaks
64 Pictures of the Future | Spring 2012
“Leakage is an unsolved problem, especially
in southern countries and when pipes are old,”
says Geiger. In countries that have plenty of
water, the losses cost “only” money and ener-
gy, because pressure-generating pumps re-
quire large amounts of energy. But in dry re-
gions the leaks are a threat to life and health.
According to the UN, over a billion people in
the Third World suffer from inadequate sup-
plies of drinking water. The World Health Or-
ganization reports that half of the world’s peo-
ple live in regions at risk of drought. But water
losses are only part of the problem. Leaks also
decrease water quality, because impurities
such as microorganisms can penetrate pipes
through the holes. “In some water supply networks in India, up
to 60 percent of the water leaks out on the
way to users,” says Geiger. Unfortunately, find-
ing leaks is a very expensive and time-consum-
ing process. One reason for this is the fact that
flow measuring devices are installed only in
major pipes, if at all. What’s happening in the
smaller pipes is discovered only by accident,
when inspectors use a listening device to de-
tect the difference in sound between a leak
and a normal diversion of the flow. Another
reason is that there is seldom a network-wide
assessment of measured values. All of this could soon change thanks to a
new system that listens to water flows and au-
tomatically detects anomalies, thus helping to
minimize expensive losses. Working closely
with their counterparts at Siemens Corporate
Technology (CT) in Munich, researchers at
Siemens’ Nuremberg-based Industrial Automa-
tion Division have developed a solution for this
problem. “We offer our customers an elec-
trotechnical package for managing their water
supply, ranging from the tapping of a freshwa-
ter source to water distribution, management
of the water supply network, and disposal of
the wastewater,“ explains Dr. Andreas Pirsing,
who is responsible for portfolio management
at the Water & Wastewater business unit. “But
thanks to our new SIWA LeakControl system,
we can now find the leaks as well.” To detect leaks, engineers divide a network
section into zones whose rate of water use can
be analyzed economically using only a few
sonar-based ultrasound flow meters to meas-
ure incoming and outgoing flows. This flow
measurement solution has already proved its
value many times for customers ranging from
oil refineries to wastewater authorities. It is
easy to install, and it can be used on pipes of
any diameter, made of any material. Another
advantage is the fact that it can be attached to
T
he ancient Greeks, Romans, and Assyrians
supplied their major cities with water
piped in from distant springs. Canals made of
precisely shaped stones enabled these urban
populations to survive. Canals had covers to
minimize losses due to evaporation, and the
Romans used concrete to prevent leakage. But
the engineers of antiquity were unable to de-
tect hidden leaks — and that’s a problem we
still have today. Even in a modern city like Lon-
don, millions of liters of water are lost to leak-
age every day. “That’s due to the dilapidated
water mains from the Victorian era,” says Mar-
tin Geiger, Freshwater Director at the German
section of the World Wide Fund for Nature. According to official sources, London loses
217 liters of drinking water daily at each joint
of its 30,000-kilometer-long water supply net-
work. If the losses could be reduced by only
one percent, 224,000 more people could be
supplied with drinking water. Each leak is small
and inconspicuous, but collectively the losses
are enormous. A teaching manual reports that
at a pressure of five bar a tiny leak only one
millimeter wide lets 58 liters of water per hour
seep into the ground. And it may be a long
time before such a leak is discovered. Depend-
ing on how a water mains operator is organ-
ized, it may take three to six months.
Mastering Complexity | Water Conservation
several zones with one another. “If an unusual
amount of water runs through all the pipes at
night all of a sudden, that’s not a leak — it
means there’s a soccer game on,” says Wehrst-
edt, who knows this from experience. That’s
because at halftime everyone’s running to the
toilet. The system does not take such peak use
into account.
No Learning Phase Needed. “In addition to
the distribution of water flow and pressure,
we’ve also been using Monte Carlo simulations
recently,” says Wehrstedt. These simulations
are particularly complex statistical processes
that can detect leaks very quickly. “To do this,
we create a simulation of the water piping net-
work. Our computers then calculate the pres-
sure conditions in the water flow within the
network using measured inflows and outflows.
This enables us to simulate the water flow
along the branches and at the points of conflu-
ence,” he explains. The result is a computer
es,” adds Wehrstedt. Engineers recommend
that network operators have their entire
pipeline network checked once every quarter.
A conventional PC needs about ten minutes to
analyze a network that is approximately 500
kilometers long and has a few hundred nodes.
“Mathematically speaking, the problem of en-
suring a metropolitan area’s water supply is a
lot like analyzing the outcome of an election,”
says Wehrstedt. “In both cases researchers con-
duct a statistical analysis of the measured val-
ues and then estimate what kind of behavior
should be expected in the future. However,
we’re not predicting how a group of citizens
will vote — we’re predicting how much water
they will use in a certain branch of a network.” Siemens engineers were able to test their
system under real-life conditions in a major
city soon after they had developed it. The leak
seekers were soon rewarded. “Even though we
were investigating a well-kept European water
piping network, the very first run-through of
a pipe from outside. A service technician sim-
ply attaches the flow meters to pipes and con-
nects them with measuring devices that trans-
mit the resulting data by radio to a process
control center. These data are then used to
produce an overview of flow rates over time. In the search for leaks, the measured values
for night hours are important, because the
amount of water that is used between 2 a.m.
and 4 a.m. is typically minimal. Only the leaks
in pipes continue to spew out water during this
time. A sudden increase from one measured
nighttime value to the next is a clear indicator
of a new leak. Siemens’ measurement algorithms require
between one and two weeks to record normal
use in a water pipeline network. After that,
they can detect new leaks automatically. The
most difficult step in this process was to devel-
op sufficiently intelligent algorithms. “A drinking water network is not a pipeline
with clearly defined inflows and outflows,”
says Roland Rosen, head of Siemens’ Model-
ing, Simulation, and Optimization (MSO) tech-
nology field. “We know exactly what’s flowing
in, but our knowledge of where the water
flows out is very vague. So we’re looking for
deviations from a standard value that we don’t
yet know.” The laws of statistics provide the solution to
this problem. If the network is sound, there is a
characteristic distribution of measured values.
This is similar to games of dice. “A leak has the
same effect as loaded dice,” explains Dr. Jan
Christoph Wehrstedt, a mathematician who
works at MSO. The computer programs watch
for unusual measured values every night. If
they detect a distorted value distribution, an
alarm goes off. In order to minimize false
alarms, the software compares the results of
model that engineers can use to run experi-
ment with.
Measured values are compared with sensor
data, substituting coincidental profiles for the
unknown behavior of consumers. The Monte
Carlo simulation then generates fluctuations in
the simulated values. These comparisons of
measured and simulated values make it possi-
ble to skip the two-week learning phase. In order to take a closer look at suspect sec-
tions of the network, the teams install addi-
tional sensors. This eliminates the need for ex-
pensive searches of suspect pipe sections
using pickaxes and shovels. “The Monte Carlo
algorithms also indicate old leaks — in other
words, leaks that already existed during the
learning phase, which we would not have
found by means of simple statistical process-
our software revealed one or more leaks in
every part of the city — which the network
managers had not been aware of,” recalls Pirs-
ing. Compared with the conventional periods
between inspections, the test run of the SIWA
LeakControl system immediately saved the
provider several hectoliters of drinking water
per day at each (repaired) leak. All the same,
one of the city’s inhabitants does not have
pleasant memories of this test run. He had ille-
gally tapped the water mains for many years in
order to fill his swimming pool. After the water
network analysis was carried out, a team of
emergency technicians was sent out to investi-
gate. The thrifty pool owner received a huge
water bill. Without the analysis he would prob-
ably have been able to swim in stolen water for
decades.Bernd Schöne
Pictures of the Future | Spring 2012 67
Major cities account for most of the world’s economic output. But they are dependent on seamless information flows in order to ensure the smooth exchange of goods within transport systems. Automation technology from Siemens makes traffic infrastructures more efficient. In the future, such systems will learn from experience and will holistically optimize traffic across regions.
To function optimally, tomorrow’s traffic hubs will
need to interconnect the schedules of everything
from planes and ships to vehicle navigation systems and public transit. Traffic control centers like Berlin’s (right) receive data from many sources. How IT Can Boost Capacity
66 Pictures of the Future | Spring 2012
This tremendous increase in traffic can be
most clearly felt in large cities, which are the
recipients as well as the victims of this devel-
opment. Because they are responsible for
about 80 percent of the world’s economic out-
put, cities are the hubs of the global mobility
network for people and goods. Just as with the
exchange of data on the Internet, hubs or
nodes are crucial to maintaining the stability of
the network as a whole. Cities have realized
this fact. In a survey commissioned by Siemens
several years ago, more than 500 mayors and
urban experts all over the world defined traffic
infrastructures as being by far the most impor-
tant factor if their respective cities were to re-
main attractive as business locations.
Ideas for Future Hubs. Does this mean that
road and rail networks need to be continually
expanded? The traffic experts who participat-
A
ir traffic is booming all over the world, and
passenger miles are growing by five to six
percent every year. In New Delhi, the third ter-
minal of Indira Gandhi Airport was opened in
2010. In Frankfurt, Germany’s biggest trans-
portation hub, a fourth runway opened in
2011. And in the U.S., investment in “NextGen”
advanced airport infrastructures and runways
is continuing at a steady clip. To take just one
example, the international airport in Los Ange-
les, which is the sixth-largest in the world and
serves 60 million passengers annually, is being
significantly expanded. The mobility of people
and goods is also increasing on roads, rails,
and ocean routes. The International Transport
Forum estimates that global passenger traffic
in all categories of transport will triple or even
quadruple in size between 2000 and 2050 and
that the transport of goods will grow by a fac-
tor of 2.5 to 3.5 during the same period.
Mastering Complexity | Traffic Systems
must first be decoupled from their electric lo-
comotive and then pushed by a diesel-pow-
ered locomotive to a track without an over-
head cable. A portal crane then loads the
individual containers onto trucks. According to
inventors from Siemens, the transshipment
process could be performed under the over-
head cable using a much simpler and lighter
unloading bridge, and the containers could be
moved around via a parallel track similar to a
conveyor belt. An entire freight train could be
unloaded in less than two hours and it could
then continue its journey. Using similar tech-
nology, containers in seaports could also be
unloaded from ships directly onto railroad cars.
Smart containers could play a key role in the
goods transportation of the future by automat-
ically providing information about their desti-
nations and delivery dates to a logistics IT sys-
tem. One Control Center for All. In Germany, a re-
search project known as the Total Airport Man-
agement Suite (TAMS), which is funded by the
Federal Ministry of Economics and Technology,
ice providers. Each of these providers dispatch-
es its employees according to a coordinated
plan, but from its own control point. Like clock-
work, each gear wheel connects with another
one — until a major disturbance, such as a
snow storm, occurs. To date, the IT systems of
service providers have been linked at best by a
shared database. As a result, alternative plans
have to be laboriously coordinated by the
heads of operations.
Things are very different in a TAMS automa-
tion environment. Here, all service providers
are linked in a single control center that coordi-
nates all operations throughout the airport.
The IT systems of the individual companies are
linked in such a way that their employees are
supported by integrated assistance functions
when they need to make decisions. “In airports that are operating close to ca-
pacity, TAMS can increase the number of air-
plane movements per hour by about ten per-
cent,” says Dr. Christoph Meier, who is
responsible for airport IT in Siemens’ Mobility
and Logistics division. This estimate is based
on simulations carried out at the German Aero-
ed in the survey have other priorities. Above
all, they want to make better use of the exist-
ing infrastructure — a step that is less expen-
sive and more environmentally friendly. This
approach is also the focus of future scenarios
conceived by Siemens’ Mobility and Logistics
Division and the “Future of Hubs” idea compe-
tition conducted by the division. “Our employ-
ees submitted 140 ideas,” reports project ini-
tiator Huschke Diekmann. The new concepts
were put on an intranet platform so that col-
leagues could evaluate and comment on
them. The ideas that were judged to be the
best all had one thing in common: They agreed
that the networking of individual modes of
transport has particularly great potential.
The winning project was called “An Inter-
modal Passenger Information Platform.” It
called for the linkage of all the information
about all modes of transport within a city in a
single software solution. All the schedules of
every form of local public transport, as well as
the traffic situation on streets, would be made
available. This would make it possible to offer
an app that could be used not only to plan a
route from house to house but also to continu-
ally check all the alternative routes in real time
and get recommendations about the best one.
Siemens presented a prototype of this system
in late 2011 at the sixth National IT Summit in
Munich. The demonstration presented an “in-
termodally” traveling businessman who navi-
gates around a traffic jam using a smart phone
and the Internet. In the process, he switches
from his car to a train and then to an e-scooter
and finally reaches his destination on foot.
The contest’s second prize was awarded to
an idea for “intermodal goods transport.” On
average, it takes up to 12 hours to unload a
freight train loaded with containers. The cars
is designed to exploit the full potential of inter-
model systems. Siemens, the project’s leader,
has worked closely with the German Aero-
space Center, Stuttgart Airport, and other in-
dustrial partners on TAMS, which was complet-
ed in early 2012.
The basic idea behind
TAMS is simple: Link every-
thing. Thus, at an airport, key
factors, such as capacity and
number of take-offs and
landings should be coordi-
nated with flight plans and
dozens of related systems,
such as the timing of refueling and luggage
loading activities, the number of people check-
ing passports, the capacity of gate areas where
planes dock, and the destinations of catering
trucks. Today, these tasks, as well as others,
are generally performed by independent serv-
space Center (DLR) in Braunschweig. TAMS
also has a positive influence on CO
2
emissions.
That’s because the integration of air traffic
control means that every airplane rolls to its
starting point only if it can take off a short time
afterward. Lines of airplanes waiting to take
off can thus be almost completely eliminated
— along with associated fuel use. Because de-
cisions taken by air traffic control, such as
changes in the direction of take-off, no longer
come as a surprise to other operators at an air-
port, punctuality simultaneously increases by
From cars and trains to e-scooters,
everything will be organized via the Internet and smartphones.
Pictures of the Future | Spring 2012 69
A “Complete and Green Mobility Partnership” between Xi’an and Siemens will give the city a new metro and a traffic guidance system like the one in Wuhan (below).
E
ver had the feeling that the traffic lights
are teaming up against you? That they’re
always red when they actually should be
green? That they interrupt the flow of traffic
rather than letting it flow unimpeded? Drivers
in the central Chinese city of Wuhan know that
feeling too — and they know that it’s decep-
tive. Even though the traffic in this city of 9.7
million people on the Yangtze River does fray
nerves at peak times, it moves better than it
did just a few years ago — thanks to traffic
lights that know at any given moment which
signal is best.
In Wuhan, about 500 intersections are
equipped with Siemens traffic controllers that
monitor road traffic. Real-time traffic data is
sent to centers where a central traffic manage-
ment system calculates an optimized regional
control plan in order to minimize congestion
and make traffic flow more smoothly. In May
2007, the municipal government of Wuhan
tried a new approach to managing its traffic
problems by hiring a Siemens consortium to
install an urban traffic control system. Up to
that point, China’s traffic planners had relied
primarily on physical infrastructure — wider
roads, more buses, and longer subway lines.
But to realize its potential, this hardware has to
be used intelligently. “We selected Siemens be-
cause the company is the world’s leading sup-
plier of intelligent traffic solutions,” says Chen
Hui of Wuhan’s Traffic Management Bureau.
The Siemens system has been in service since
2009. Since then, “the traffic situation has
greatly improved,” says Chen.
Traffic light signaling is only the most visi-
ble part of the system. Within the framework
of a long-term collaboration, Siemens and its
partners are implementing “Complete and
Green Mobility” in Wuhan — a concept de-
signed to achieve optimized coordination
among transport systems in order to move
passengers and goods in fast, safe, efficient,
and environmentally-friendly ways. Last year,
Siemens, which advises Wuhan on its infra-
structure, won an order to provide propulsion
systems for two metro lines.
The Wuhan project was co-financed by the
World Bank, whose development experts see
the approach as a blueprint for managing one
of the biggest challenges facing Chinese cities.
Never before in history have so many people
There is vigorous competition among China’s megacities. Only
those that offer a livable environment will attract talented people
and the industries of the future. Effective and environmentally-
friendly transportation systems play a key role here.
Moving Experience
Mastering Complexity | Traffic Management
surged into urban centers so quickly. There are
now more than 160 cities in China with more
than a million residents each. Although China
had traditionally been a largely agricultural
country whose residents lived mostly in vil-
lages, the balance shifted in 2011, when, for
the first time, more than half the population
lived in cities. Demographers forecast that by
2015, the number of China’s city-dwellers will
probably grow from 657 million today to 700
million. And by 2030, there will likely be a bil-
lion urban residents.
Getting there Faster on an Electric Bike.
Many major Chinese cities face the specter of
total gridlock. Already, Chinese people are
spending many hours in traffic every day —
losing productive hours from work and from
their families. And because of traffic jams, at
rush hours, the average speed of traffic in Bei-
jing’s city center is only slightly over ten kilo-
meters per hour. Since cars often spill over into
bus lanes, public transit doesn’t move any
faster. Many Chinese are therefore discovering
that they can get to their destination more
quickly on bicycles or electric bikes, of which
68 Pictures of the Future | Spring 2012
up to 20 percent. This results in clear economic
advantages for airlines. The European air safe-
ty authority, Eurocontrol, estimates that the
costs that are caused by all flight delays in Eu-
rope total as much as €1 billion annually. The results of the TAMS research project
have been so encouraging that Siemens in-
tends to offer TAMS as a product as early as
2012. Airports will then be able to buy the
complete software architecture, as well as a
control center, from Siemens.
From the passenger’s perspective, it’s cru-
cial not only to land on time but also to reach
his / her ultimate destination quickly. However,
in many cases, arriving passengers discover
that the local infrastructure has failed to keep
pace with economic growth. This can become
monitored with the help of video cameras and
almost 2,000 sensors, most of which are in-
duction loops embedded in asphalt. More than
1,700 traffic lights and 300 overhead sign
gantries can be controlled fully automatically
from the city’s control center based on traffic
flow and time of day. But even such high-tech
installations can be further improved through
ultramodern control technology.
Intuitive Decision-Making. A far more ad-
vanced solution is a cognitive soft-
ware system developed by Dr.
Georg von Wichert, an automation
expert at Siemens Corporate Tech-
nology. von Wichert loaded the sys-
tem with four weeks’ worth of traf-
fic data from Berlin. “In this case,
‘cognitive’ means that the system it-
self creates a model of the city’s traffic process-
es and then makes decisions,” he explains. In
other words, the system does not base its as-
sessment of the traffic situation on individual
sensor measurements and on what’s happen-
ing on individual streets. Instead, it evaluates
Every city has different sources of traffic congestion and therefore
needs customized solutions. sistance system as an initial step, and thus to
help control center personnel choose the best
control program for the city’s traffic lights. An additional advantage of the cognitive
system lies the fact that it’s capable of learn-
ing. “In the next step, we could generate tiny
variations in the system’s parameters,” says
von Wichert. “This would allow us to test the
reaction of the system as a whole and thus op-
timize the control programs in many small
steps without interfering with traffic flow.” More extensive tests would be able to show
to what extent the traffic in a major city could
flow more smoothly with the help of cognitive
systems. But von Wichert is convinced that in
complex situations, his learning model-based
control system will be superior to human oper-
ators in a control center. Diekmann also believes that automatic con-
trol systems will do far more than just manage
road traffic. He predicts that in coming
decades control centers for road traffic, local
public transportation systems, and even the
dispatch centers of courier and freight services
will all be interconnected. “When that hap-
particularly clear if they’re taking a taxi. In
many cities, the average speed of a taxi during
rush hour is less than 20 kilometers per hour. Diekmann, the technology strategist, be-
lieves there’s no such thing as a sensible stan-
dard solution. “Every city is different,” he says.
To discover not only the quickest route, but the
one with the least environmental impact,
Dozens of parameters must be taken into ac-
count, including emission figures for different
modes of transport and lengths of traffic jams.
Solutions depend on the accuracy of data. The
data must then be registered and processed by
traffic guidance systems such as the ones
Siemens has installed in over 1,000 cities. Siemens commissioned one of the most
modern traffic guidance centers in Berlin in
2005. The flow of traffic throughout the city is
sensor data within the overall urban context
and “understands” the situation as a whole.
This is a form of intelligence that people use
intuitively, which explains why service person-
nel like to switch back and forth between pro-
grams at the control center to get an overview. The advantage of a cognitive system is that
it can observe complex data in parallel and
thus recognize deviations from normal conges-
tion patterns faster than a human can. Howev-
er, it must be trained. After von Wichert’s sys-
tem had completed its learning phase, it
became clear that the city’s traffic flows and
regularly-occurring congestion could be accu-
rately predicted. Special cases, such as jams re-
sulting from accidents or short-term construc-
tion sites, were also reliably detected. Using
this data, it would be possible to create an as-
pens, cities will have a nervous system that
makes it possible to comprehensively optimize
traffic over broad areas,” he predicts.
If cognitive intelligence is one day used to
coordinate all modes of transport and all trans-
port hubs, the dream of the super mobility app
might become a reality. This is how it would
work: The traveler enters any destination in
the world into the app, and the app suggests,
for example, three different travel routes that
can include any mode of transport, but in all
cases are oriented toward optimized travel
times, costs and CO
2
emissions. Such sugges-
tions would be based not on theoretical sched-
ules, but on current forecasts of traffic condi-
tions. If conditions change in the course of a
trip, route suggestions would be adjusted in
real time. Johannes Winterhagen
Siemens researchers are developing an app that monitors all of a city’s transportation modes in real time and guides travelers to their destinations. that had been written into the contract, and
jeopardizing future work in the Kingdom. This
internal study predicted that finishing the job
on time would not be possible. Based on a de-
tailed analysis of the conditions and the time
remaining, it simply couldn’t be done. “We
were shocked,” says Börnicke. “But we decided
to ignore our own internal analysis and to con-
tinue working even faster.”
Tight Finish. During September and October,
the project relied extensively on shift work and
night work. Rail projects are usually performed
in a logical, pre-determined sequence. But
with the deadline looming, work had to pro-
ceed around the clock, often with different
jobs being performed at the same time. For ex-
ample, overhead lines were installed while
tracks were being laid or adjusted — an ex-
tremely difficult task. Even for experienced
professionals like Börnicke’s Siemens team,
this amounted to a completely new way of
working.
After an intense final few weeks, the Hajj
was set to begin. And, remarkably, all stations
opened on time. Trains up to 300 meters long
traveled the route in less than 30 minutes —
most of them at full capacity with 4,000 pas-
sengers on board. In fact, so many people
were transported that the Chinese manufac-
turer of the rail carriages has applied to have
the achievement entered in the Guinness Book
of Records.Tom Jakobsh
Pictures of the Future | Spring 2012 71
The rail project presented a unique chal-
lenge due to its extremely tight deadline — 17
months. For one thing, it was being built for
the intense burst of traffic during the Hajj. For
the rest of the time — more than eleven
months of the year — the trains and tracks
would see almost no activity. A similar fast track project in Guangzhou,
China, had taken 33 months to complete. A
project in Santo Domingo, in the Dominican
Republic, was completed in a record-breaking
27 months. 50 Degrees — No Shade. In addition to these
scheduling pressures, climatic conditions
posed a major challenge. Mecca is located in a
dry, hot corridor between mountains. Project
Manager Ralf Börnicke has vivid memories of
the extreme weather conditions. “Tempera-
tures were often as high as 50 degrees Celsius.
And then there were extremely heavy rainfalls.
Construction work was very, very tough,” he
recalls. Mecca’s status as the holiest site in Islam
also presented unique demands. Visa require-
ments were complex and key personnel were
not always permitted access to the site.
Finally, the nature of the Hajj created
unique technological and design challenges.
Because of the nature of the events that com-
prise the Hajj, all pilgrims travel the same paths
at any given time. Passenger traffic flows ex-
clusively in one direction, first toward Mecca,
and then back again. Therefore, both tracks
along the double-tracked section had to be
uni-directional rather than moving in a “loop”
as in standard subway systems.
The project was designed as a turnkey oper-
ation, consisting of nine passenger stations,
with a total capacity of 72,000 passengers per
hour per direction. In addition to two lines of
track — an 18-kilometer Southern Line and a
20-kilometer track with an extended depot —
the project also required its own power supply
system. Siemens was responsible for delivering
substations, switchgear, cable systems, diesel
generators, and an overhead contact line for
the entire route. The train carriages themselves were provid-
ed by a Chinese partner, the China Railway
Construction Corporation.
Because of the project’s tight timelines,
much of its design and factory testing had to
be conducted in parallel. As the project pro-
ceeded, it became clear that many of the local
government buildings and other facilities that
the project depended on would not be com-
pleted on time. During the critical period in the
early fall of 2010, there were serious doubts
about whether meeting the deadline remained
feasible. To formulate a clearer overview of the situ-
ation, Siemens conducted an internal analysis
to see where things stood with respect to the
November deadline. Default would be an enor-
mous setback, triggering significant penalties
Providing a power supply system for Mecca’s new metro line was far from straightforward. But delays were not an option — the religious Hajj pilgrimage to Mecca is an event that demands strict adherence to deadlines.
Deadline in the Desert
Managing Complexity | Hajj to Mecca
Because of an iron deadline, much of Siemens’ work in electrifying the rail system for the Hajj pilgrimage had to be carried out in parallel. This included 24/7 construction work on overhead
lines even as tracks were being installed.
500,000 passengers every day, which takes a
great deal of strain off the city’s streets.
Similar plans have been made by the mu-
nicipal government in Xi’an, which entered
into a partnership with Siemens in June 2010.
In June 2011, Siemens produced the “Xi’an
Green Mobility Integrated Solutions” consulta-
tive paper as part of the city’s efforts to im-
prove traffic efficiency. In addition to support-
ing local planners with its know-how — for
example, in relation to the signaling system for
Xi’an’s metro line 1 — Siemens is also running
a signal technology joint venture called
Siemens Signalling Co., Ltd. in Xi’an. The prod-
ucts and components assembled there are be-
ing used in many cities in China.
Charging Stations for Electric Cars. Com-
plete and Green Mobility is not limited to the
optimization of existing transportation sys-
tems. It also applies to the development of
new ones. The People’s Republic hopes that
electric cars in particular will help it become
much more environmentally friendly and re-
duce energy consumption. Today, in China, only one person in 20
owns a car, whereas in Germany the equiva-
lent figure is one in two. World Bank experts
therefore believe that China could become the
first country to use electric cars on a large
scale. According to government plans, up to
one million hybrid and electric vehicles could
be on China’s roads by 2015.
That’s ambitious but not unrealistic. One
key challenge in this regard is building a charg-
ing station infrastructure. Here too Siemens is
a pioneer. In December 2011, the company re-
ceived a contract to install 140 charging sta-
tions in Shanghai. These can be used to
recharge both electric compacts and buses.
“That’s a milestone for Siemens’ business de-
velopment in China’s e-vehicle infrastructure
market,” says Dr. Xiao Song, who is responsible
for the Infrastructure & Cities Sector, Siemens
North East Asia/ASEAN-Pacific. “Our compre-
hensive portfolio for urban infrastructure is
helping China make its cities more sustainable,
competitive, and livable.” Bernhard Bartsch
70 Pictures of the Future | Spring 2012
more than 20 million are sold every year in
China. However, few Chinese are willing to ride
bikes over longer distances. After all, more
traffic means that an accident is more likely. In
addition, smog in many large Chinese cities
has become a matter of concern.
Transportation systems should not only ef-
fectively carry large numbers of people, but
also be inexpensive. One special challenge is
how to finance developments in infrastructure
that will help determine which major Chinese
cities are livable in the future — particularly
since quality of life is a basic prerequisite for at-
tracting qualified workers and encouraging to-
morrow’s companies to put down roots.Others
have moved quickly to emulate Wuhan’s far-
sightedness. Several other Chinese cities, in-
cluding Nanjing and Xi’an, have now also
formed “Complete and Green Mobility” part-
nerships with Siemens. In late 2009, the municipal government of
Nanjing, a city of eight million that is currently
preparing for the Youth Olympic Games in
2014, signed an “Integrated and Green Trans-
portation System” cooperation agreement. As
part of this agreement, Siemens will support
the city’s efforts to make its various transporta-
tion systems work together more effectively.
Here again, an intelligent traffic management
system will improve the functionality of the
transit network and benefit the environment
at the same time. According to the agreement,
Siemens will not just supply technology but
will also help the city train its traffic experts. In order to ease traffic, the Nanjing munici-
pal government has vigorously developed its
mass transit network. So far, all of its metro
lines have been equipped with Siemens’ sig-
naling systems. In 2010, Siemens equipped
subway line 2 with Trainguard MT, an automat-
ed control system. The system allows 35 trains
and a control center to exchange information
in real time. As a result, the intervals between
trains are shorter and the frequency of the
trains can be adapted flexibly in line with pas-
senger volumes. The system’s operators de-
scribe it as “very stable and reliable.” Line 2,
which is 38 kilometers long, carries around
Thanks to Siemens technology, the Nanjing metro is ready for the 2014 Summer Youth Olympics.
E
very year, millions of Muslims from around
the world travel to Mecca, the holiest site
in Islam, for the annual “Hajj” pilgrimage. The
Hajj has always been a massive event. But in
recent years it has grown quickly. The number
of pilgrims visiting Mecca from foreign coun-
tries grew from around 1.1 million in 1996 to
more than 1.8 million in 2011. It is difficult to
accurately measure the total number of annu-
al participants, but many estimates put this
number at close to four million.
Moving millions of people over a five-day
period creates immense logistical challenges,
particularly with regard to efficiency and safe-
ly. Indeed, things have not always gone well
during the long history of the pilgrimage.
Equally important is creating capacity for fu-
ture growth. With air travel becoming increas-
ingly affordable, it is reasonable to assume
that more of the world’s 1.5 billion Muslims
will participate in the Hajj in years to come.
The final stage of the pilgrimage was, for
centuries, conducted on foot. But with crowds
growing in size, and increasing numbers of
elderly and disabled people making the trek,
Saudi authorities decided that the time had
come to modernize a portion of the route. In
May 2009, Siemens was awarded a contract to
build a power supply system for the rail con-
nection from Arafat to Muzdalifah and Mina,
just south of Mecca. Siemens has been con-
tributing to the development of Saudi Arabia’s
transportation infrastructure since the 1930s. As our cities continue to grow, our energy, wa-
ter, and traffic networks are becoming increas-
ingly complex. In order to efficiently control such
interwoven systems, we require ever more assis-
tance from computers. This will increase the
amount of data stored worldwide to 35
zettabytes — 35 billion terabytes — by 2020.
Germany has taken on one of the most complex
of all projects: increasing green electricity to 80
percent of total generation, while reducing
greenhouse gas emissions by 80 percent. On the
road to this goal, much of Germany’s energy sys-
tem will have to be rebuilt. (pp. 42, 45)
The village of Wildpoldsried is a pilot project for
the energy revolution in Germany. Here, more
than twice as much green electricity is generated
than is consumed. An intelligent power grid en-
sures that fluctuating energy supplies from solar,
wind, and biogas facilities don’t threaten the sta-
bility of the network. Software agents regulate
the interaction between energy consumers and
producers in the grid using smart grid software
from Siemens. An additional role will be played
by 32 electric cars, which will serve as storage for
surplus electricity. (p. 46) According to Stephan Kohler, head of the Ger-
man Energy Agency, “The pace of the energy
transition poses challenges for which we still
don’t have complete solutions or the required experience.” (p. 49)
In cities, infrastructures are interwoven to
form intricate systems. Even minor changes to
these systems can have huge consequences.
Siemens researchers have developed a software
platform that uses 3D modeling to vividly illus-
trate the complex interactions involved. With this
tool, the impact of major construction projects on
their surrounding areas can be simulated and a
variety of data can be generated — including
data on future traffic flow patterns, air pollution,
and the degree of pedestrian friendliness. (p. 60)
Cities are dependent on the smooth exchange
of information as well as on freedom of trans-
portation. Advanced IT can help to make better
utilization of transportation infrastructure possi-
ble. In the future, self-teaching city-wide systems
could provide integrated and autonomous traffic
control. (pp. 66, 69)
PEOPLE:
Smart Grid Allgäu: Ale
xander Hammer, Infrastructure & Cities
alexander.hammer@siemens.com
Dr
. Michael Metzger, Corporate Technology
michael.metzger@siemens.com
User-Friendliness:
Dr. Martin Scheurer, Corporate Technology
martin.scheurer@siemens.com
Anke Richter, Corporate Technology
a.richter@siemens.com
Digital City Planning:
Dr. Bernd Wachmann, Corporate Technology
bernd.wachmann@siemens.com
Tim Schenk, Corporate Technology
tim.schenk@siemens.com
Safety for Complex Systems:
Elmar Rothenwoehrer, Corporate Technology
elmar.rothenwoehrer@siemens.com
Alexander Schenk, Infrastructure & Cities
alexander.schenk@siemens.com
Martin Rothfelder, Corporate Technology
martin.rothfelder@siemens.com
Drinking Water Supplies:
Dr. Andreas Pirsing, Siemens Industry
andreas.pirsing@siemens.com
Roland Rosen, Corporate Technology
roland.rosen@siemens.com
Traffic Systems:
Huschke Diekmann, Infrastructure and Cities
huschke.diekmann@siemens.com
Dr. Georg v. Wichert, Corporate Technology
georg.wichert@siemens.com
Metros in Mecca and Algiers:
Ralf Börnicke, Infrastructure & Cities
ralf.boernicke@siemens.com
Stephane Bayon de Noyer, Infrastructure & Cities
stephane.bayon_de_noyer@siemens.com
Public Participation: Matthias Holenstein, Risk Dialogue Foundation
matthias.holenstein@risiko-dialog.ch
Ortwin Renn, Dialogik Gesellschaft
ortwin.renn@sowi.uni-stuttgart.de LINKS:
Institute for Communication Research:
http://www
.dialogik-expert.de/en/
Germany Energy Agency: www
.dena.de
The Energy Revolution: http://www.bmu.de/english/aktuell/4152.php
After 30 years of planning and construction work, Algiers now boasts the second subway system on the African continent. Siemens was able to complete the project in just five years.
A new subway system brings residents of Algeria’s capital from the suburbs to the center in just ten minutes. Siemens also supplied the system’s control center. T
he blue-and-white train slowly rolls into
the Cité Mer et Soleil station in the center
of Algiers. A crowd watches its arrival with rapt
attention. Many of the onlookers hold up digi-
tal cameras and smartphones to record the
event. What a spectacle! Looking back on that
day, Siemens engineer and head of the Algiers
metro project, Stéphane Bayon de Noyer, re-
calls, “People were truly excited, sharing videos
online and wanting everyone to know that
they had a metro now too.”
And that was how Algiers, the capital of Al-
geria, finally opened its first metro on Novem-
ber 1, 2011, after three decades of planning
and construction. Following the example set
by Egypt, Algeria is now the second country in
Africa with a subway network. In June 1981
the Algerian government decided to build
three subway lines. The plan was to relieve dai-
ly traffic congestion in this city of 3.5 million
people. However, work on the project was con-
stantly interrupted, an economic crisis in the
1990s reduced progress, and poor planning
also took its toll. Siemens has operated an office in Algeria
for 50 years, during which time it has focused
on building power plants, pumping stations,
he was greeted by a festive crowd. Onlookers
waved Algerian flags and sported traditional
robes in pink, yellow or green. Bouteflika
bought a ticket for 50 dinars — approximately
€0.50. He took the train eastward along the
coastline, where houses line the hillsides up to
an altitude of almost 400 meters. In many
places, the area is like an amphitheater with an
ocean view. But the passengers see none of
this, since nine of the line’s ten stations are lo-
cated underground, often up to 50 meters be-
low street level. The subway rumbles below
the city’s botanical gardens and extends to the
Tafourah Grande Poste station, the last stop.
This station lies below the old merchant quar-
ter with its famous casbah, a historic citadel
dating from the 16th century, which is now a
UNESCO World Heritage Site. The artifacts that were discovered during
construction of the subway may date back to
antiquity. At any rate, they certainly caused
construction to be halted from time to time,
says Bayon de Noyer. The subway line’s close
proximity to the bay also caused difficulties.
When seawater began trickling into the tunnel,
specialists had to be called in to seal cracks,
gravel pockets, and joints. What’s more, 90 percent of all the materials
and components had to be imported to Alge-
ria, with delivery times of eight weeks on aver-
age. In order to forge ahead without additional
delays, project managers had to finely cali-
brate the various areas of responsibility and in-
terfaces with the client, the consortium part-
ners, and hundreds of employees. The
project’s planning software was particularly
useful, as it enabled everyone to see the over-
lapping areas between different tasks, upload
and check up-to-date construction reports, and
even take weather conditions into account. As
a result, Siemens was able to complete Line 1
in just a few years. Second Line Planned.To get through the city
center, residents of Algiers now need only ten
minutes by subway instead of 45 minutes by
car. Since parking is very hard to find in town,
they can leave their cars outside the city cen-
ter. All in all, the new subway can transport
21,000 passengers per hour. And more sta-
tions are being built. Siemens is already plan-
ning a second line to follow the first, which has
generated so much enthusiasm. Videos on
YouTube show off the new subway, and the
comments underneath range from euphoric to
laconic — referring to the long construction
phase. But as the old adage says, “Good things
come to those who wait.” After all, the first
two attempts to install a submarine cable be-
tween Algeria and Sardinia failed in 1855 and
1856. It was the third attempt, led by Werner
von Siemens, that succeeded.Silke Weber
72 Pictures of the Future | Spring 2012
and high-voltage facilities. The history of
Siemens and Algeria, however, is much older
than that. In fact, it goes all the way back to
1857, when Werner von Siemens had the first
submarine cable between Africa and Europe
installed. The cable ran from Annaba in Algeria
across the Mediterranean to Cagliari, the capi-
tal of Sardinia.
Complex Agreement. In 2006, Siemens
signed a fresh contract with the Entreprise
Métro d´Alger transit authority. At that point,
Siemens’ French transportation unit, the lead-
ing partner in the project, assumed responsi-
bility for planning the new subway. The unit,
which has almost 300 employees, delivered
tracks, cutting-edge technology such as auto-
matic train control and positioning systems,
and provided telecommunications and radio
transmission systems. French Siemens experts
even delivered the ticket machines and the
technology for the operations control center.
The Algerian metro is now as modern as
Line 4 in Barcelona, Line 1 in Paris, and the Ca-
narsie Line in New York. Nevertheless, Bayon
de Noyer remembers that it took quite some
time and required a lot of patience before the
first subway train was able to speed beneath
the city — the first of 14 trains to be provided
by the Spanish consortium partner Construc-
ciones y Auxiliar de Ferrocarriles S.A. “Imple-
menting such a large-scale project is standard
practice in Europe, but it was something new
for Algeria,” he says. For a start, Algerian and French working
days had to be coordinated. The project basi-
cally started off with a three-day work week,
since Thursday and Friday made up the week-
end in Algeria at that time. Since then, Algeria
has adopted a weekend consisting of Friday
and Saturday. Another thing Bayon de Noyer
had to get used to was long customer meet-
ings that often failed to reach decisions. But
these were cultural differences, he concedes.
Altogether 2,000 people worked on the Algiers
subway, including 1,700 Algerians, plus work-
ers from Spain, Italy, France, Syria, and Egypt.
Says Bayon de Noyer, “With all the different
languages and cultures, coordinating the proj-
ect has been pretty complex.” When the opening day finally came, the Al-
gerian president, Abdelaziz Bouteflika, de-
clared the subway to be operational and im-
mediately tried it out himself. At the station,
Subway to a Better City
Mastering Complexity | Algiers Metro
Pictures of the Future | Spring 2012 73
Mastering Complexity
In Brief
Pictures of the Future | Spring 2012 7574 Pictures of the Future | Spring 2012
T
he vehicle test rig at Siemens Corporate
Technology (CT) in Munich, Germany,
doesn’t look much like an automotive facility
— there are no oil puddles, black exhaust
spots, or gasoline smells. But that’s not surpris-
ing, given that this is a place where clean elec-
tric cars are tested. Right now, a sleek green-
and-white open-top sports car is suspended on
the lift at head level as if it were trying to em-
Pictures of the Future | Electric Vehicles
Wheel-hub motors allow electric drive units to be located where their torque is needed: at the wheel. Here, they can also be used as brakes. In combination with a new system architecture, these motors not only enhance efficiency and safety, but also open the door to personalized cars through
software upgrades. Researchers at Siemens have already developed an initial test vehicle.
Power where it’s Needed
Siemens researchers equipped a Roding sports car with two wheel-hub motors. The electric drive units fit into the rims and produce a total torque that can reach 2,500 newton meters.
mental effect on handling, and that the motor
itself, which has no shock-absorbing capabili-
ties, could be damaged if it hit the ground on
uneven surfaces. Tests showed that this con-
cern was unfounded, and it might even be
possible to install springs directly at the wheel
in the future.
Wheel-hub motors take up practically no
space in the vehicle interior — a feature that
opens up completely new opportunities for de-
signers. “Whereas a conventional vehicle has
to be built around the power train, cars with
wheel-hub motors make it possible for us to
explore new approaches,”
says Prof. Gernot Spiegelberg,
Director of Electric Mobility
Concept Development at
Siemens Corporate Technolo-
gy. “Thanks to this develop-
ment, we can now design a
vehicle to offer optimal er-
gonomics and handling without having to wor-
ry about where we’re going to put the engine.” The best part is that there is no need for any
heavy, energy-guzzling camshafts, transmis-
sions, or differentials. Most electric vehicles
also don’t require a clutch or gears; the wheel-
hub motors in the roadster test vehicle deliver
the necessary power right from the start and
can accelerate the car to 160 kilometers per
hour with a torque of 1,000 newton meters
(and as much as 2,500 newton meters for
short spurts) without any gear changing. The
cy at partial engine loads. We’re presenting the
technology in a sleek sports car, but the goal of
our development activities is to create an ur-
ban vehicle, which would drive in the medium-
load range most of the time.” Freitag actually doesn’t like it when people
refer to his wheel-hub drive unit as a “motor.”
He believes “machine” is a better term, since
the motor also serves as a brake. The high per-
formance of each of the two motors (63 kilo-
watts in continual operation; 120 kilowatts
maximum) results in a total output of 325
horsepower. This is very important, because
that power is available even when the motor
acts as a brake and a generator for producing
electricity that is then stored in the battery.
The vehicle’s electric-motor braking system is
therefore powerful enough to generate the
legally required 30 percent of total braking
force that will bring a vehicle to a stop if the
mechanical braking system fails. Regenerative braking is now a standard fea-
ture in electric vehicles — but Siemens engi-
neers are moving far beyond today’s technolo-
gy with their wheel-hub machine. Up until
Wheel-hub motors not only propel the vehicle; they also serve
as reliable electric brakes.
phasize its outstanding aerodynamic proper-
ties. Siemens developed the car with the sup-
port of Germany’s Environmental Ministry and
in cooperation with Roding Automobile, TRW
Automotive, and other small companies. At the
test rig, the vehicle’s axles are connected to
four giant, external air-cooled electric motors
whose bulk stands in sharp contrast to the car
itself — a typical test arrangement for simulat-
ing every type of driving situation by altering
the rotation of each individual tire. The special feature of this electric car is its
two wheel-hub motors, which are small
enough to fit into the vehicle’s rims. The first
electric cars with wheel-hub motors actually
came on the scene 112 years ago — one ex-
ample being the Lohner Porsche, which was
presented at the Paris World’s Fair in 1900. A wheel-hub motor is the ideal drive unit
because it can be installed exactly where
torque is needed: in the wheel. Size is not real-
ly the technical issue here; the important thing
is to make the motor as tightly sealed as possi-
ble, despite its freely moving parts, so as to en-
sure that it is not damaged by dirt or moisture.
For a long time there were concerns that such
a large mass at the wheel could have a detri-
system also recovers almost all of the potential
and kinetic energy released in 70 percent of
braking maneuvers.
“High speeds weren’t the objective here,
though,” says Dr. Gunter Freitag, who headed
the team that developed the CT motor. “That’s
why we electronically limited the vehicle’s top
speed to 120 kilometers per hour. It was more
important for us to achieve very high efficien-
now, electric car developers have always set a
constant drag torque that begins braking the
vehicle when the driver takes his or her foot off
the gas pedal. As soon as the driver engages
the brake, normal friction brakes kick in and
convert a relatively large portion of the kinetic
energy into heat that goes unused.
In the Siemens concept, the vehicle initially
brakes only electrically; the conventional fric-
Pictures of the Future | Spring 2012 7776 Pictures of the Future | Spring 2012
tion brakes aren’t used until more than 30 per-
cent of the maximum braking force is required.
“Experience has shown, however, that this isn’t
necessary in more than 70 percent of all brak-
ing maneuvers,” Freitag explains. “In other
words, we can recover as much as 80 percent
of the kinetic energy produced from braking in
such cases.” As Freitag points out, the driver
doesn’t notice any of this “brake blending.”
This innovative technology, coupled with a
19.4-kilowatt-hour lithium-ion battery, give
the Roding roadster a range of approximately
120 kilometers.
Systems Approach. Obviously, the roadster’s
technology makes sense only if each motor is
controlled solely by electronic systems.
Spiegelberg is convinced that the transition to
electric drives will force engineers to rethink
everything in terms of systems rather than
components, as has traditionally been the
case. “The current transition from combustion
engines to electric drives gives us an opportu-
nity to reinvent the entire vehicle nervous sys-
tem, so to speak,” he explains. This develop-
Siemens researcher Dr. Gunter Freitag (left) inspects a wheel-hub drive, which can also be used as an electric brake.Experts at Siemens can simulate any driving situation with their test rig by altering the rotation of each wheel.
The Roding Roadster Electric with Siemens wheel-hub motors has an output of 325 hp; the car’s lithium-ion battery gives it a range of around 120 km.Wheel-hub motors already enable extremely precise maneuvering in curves. In coming years, they will also make it possible for cars to turn in place.
ment will also greatly improve safety and com-
fort. For example, all control systems could be
linked and could activate themselves without
the driver having to do anything. This will be especially true in the future
when each wheel will be equipped with a mo-
tor that can be controlled individually. Whereas
today’s anti-lock systems react only passively to
blocked wheels by reopen-
ing the brakes, the wheel-
hub motors can be made to
brake so precisely that none
of the wheels lock. This will
also make it possible to ma-
neuver through curves more
safely at higher speeds. “If every wheel has a drive unit, you can de-
sign a car that will react extremely fast as it ne-
gotiates a sharp curve at high speed, because
each motor automatically accelerates exactly
the way it should. On a highway, the same ve-
hicle will handle like a smooth and stable
sedan — and all of this will be done with just
the push of a button,” Freitag explains. Experts
refer to this as torque vectoring. In the not-too-distant future, it will be pos-
sible to not only integrate drive units, brakes,
and shock absorbers into each wheel, but also
a steering system.
Now consider what would happen if the
two front wheels turned in and the two rear
wheels shifted out simultaneously. This would-
n’t make any sense — at least not if a conven-
tional vehicle were involved. But if the left
wheels move forward and the right ones move
back, the car would rotate in place. That would
be good news — and not just for new drivers
who have to make U-turns in three maneuvers
today. It would also be possible, of course, to turn
all four wheels to the right in a right curve,
which would allow you to get into even the
tightest parking spaces — perhaps with the
help of a parking assistant.
Drive-by-Wire. All of these concepts in-
evitably lead to the following question: Who
will actually drive tomorrow’s cars — people or
machines? In other words, will our vehicles be-
come robots?
“There’s a new concept that will enable the
safe and simple activation of future holistic
driver assistance systems that manage brak-
ing, steering, and propulsion, among other
things,” says Dr. Michael Armbruster from CT,,
who received his PhD from the Institute of Air
Vehicle Systems at the University of Stuttgart.
Before joining Siemens, Armbruster played a
major role in transferring the fly-by-wire con-
trol concepts in modern aircraft into electroni-
cally-controlled and completely fail-safe sys-
tems for ground vehicles. Such systems, however, require new vehi-
cle control and communication concepts. In
drive-by-wire systems, wheels are not turned
mechanically, but are instead positioned via
electric signals — an arrangement that allows
for the incorporation of every possible type of
electronic assistance system. Cars equipped
with such a system could park themselves,
brake autonomously in dangerous situations,
and automatically assist drivers in moving
through road construction sites. The numerous
potential driver support options enabled by in-
novative driver assistance systems will become
even more important in the future, as an in-
creasing number of older individuals will also
want to remain mobile. It’s even conceivable
that cars will be able to drive completely on
their own. Drive-by-wire can also be used in vehicles
with combustion engines, of course. But this
requires existing components to be gradually
replaced or linked. The changeover to electric
drive systems basically offers design engineers
the opportunity to recreate system technolo-
gies whose efficiency can be exploited espe-
cially well when the drive systems, brakes, sus-
pension, and steering are integrated into each
wheel and consistently and safely controlled. But if this vision is to become a reality, elec-
tronic systems will have to be one hundred
percent reliable and hardware will therefore
have to be redundant. Siemens researchers
distinguish between hardware and functions
in their concept. Their view is that a control
unit doesn’t need to know which hardware im-
plements its commands. Thanks to this separa-
tion of hardware and function, it is possible to
make software so scalable that new functions
can be added at any time through a plug-and-
play arrangement. Siemens engineers are currently working
with several research and industrial partners to
turn their vision into reality. With support from
Germany’s Ministry of Economics and Technol-
ogy, these organizations plan to develop and
test a new system architecture for electric vehi-
cles by the end of 2014. This architecture will make it possible for
motorists to add assistance and safety systems
to their vehicles in much the same way that
computer programs are updated and upgraded
today. After all, you never know whether you
might need a parking assistant when you get
older — and what better way to install it than
with a download?Bernhard Gerl
The transition to electric drives
offers the opportunity to reinvent
the entire vehicle nervous system.
Pictures of the Future | Spring 2012 7978 Pictures of the Future | Spring 2012
Highlights
84 Starving the Energy Monster
There are 1.5 million commercial
buildings in the U.S. Soon, they may
be saving not only oceans of energy,
but helping to level loads throughout
the electrical grid. Pages 84 & 86
88 No Energy Policy, but...
According to energy expert Ernest J.
Moniz, the U.S. is cutting CO
2
emis-
sions even without an energy policy. 90 China’s Sustainability Boom
China’s top priorities include boosting
efficiency, reducing emissions, and
creating environmentally-sustainable
cities. 96 Lower Prices in the Air
Engineers at Siemens are developing
technologies that could radically increase the competitiveness of wind power. 99 Formula for Grid Stabilization
A new machine learning solution is
helping Switzerland’s national grid
company to accurately predict transfer losses and stabilize the grid.
100 The Most Versatile Fuel
When it comes to storing the power
generated by excess wind and solar
energy, nothing beats hydrogen.
104 Hot Opportunities
Around half of the primary energy
consumed in industrial processes is wasted. Siemens is developing
technologies designed to intelligently utilize much of
this energy. 2035
A modern copy of Pompeii is about to open
its doors. Funded by private investors and
cultural institutions, the new city will offer
apartments and villas for thousands of resi-
dents. It will also offer research opportuni-
ties for students and scholars, and a venue
as a living laboratory for combining the effi-
ciency of ancient urban plans with the latest
in energy-saving technologies.
Hi!
Let me introduce myself. Almuntasir
Ben Zeyyad, chief visionary and archi-
tect of something completely novel, yet thou-
sands of years old: Pompeii Novum — an inno-
vative city based on its ancient eponym; a city
designed to invisibly meld everything we know
about energy efficiency with the best of what
the ancients knew about living in harmony
with the environment and with each other.
And we’ve almost made it!
Just a few years ago there was nothing here
but an abandoned naval base, a magnificent
Extravagant, emotional, and self assured, the “chief visionary”
of a modern version of Pompeii explains how the city’s ancient
counterpart has served as a model for a new kind of future.
Let the Games Begin!
Formulas for Efficiency | Scenario 2035
view of the sea, and an idea. But in a few
months, people will be shopping for genuine
“hand-made-equivalent” copies of ancient Ro-
man products, and sipping freshly-pressed
pomegranate juice at sidewalk tabernae in the
shaded, frescoed nooks of arcaded forum
buildings — exact copies of the originals.
Tourists and locals will be exploring the city’s
ochre-colored streets, relaxing in our baths and
deliriously cheering their favorite contestants
at our fully-functional coliseum. Students and
scholars will be studying mosaic and fresco de-
Pictures of the Future | Spring 2012 81
Whether we are confronting the challenges of climate change or
the problems posed by the growing scarcity of commodities such
as carbon fuels and metals, technologies that boost efficiency
have never been as important as they are today. Enhanced effi-
ciency saves not only raw materials and energy but also loads of
money. Developing such technologies therefore presents compa-
nies such as Siemens with a major opportunity in world markets. Efficiency Is the Key
Formulas for Efficiency | Trends
T
oday, prizes and awards, even in the field
of technology, are a dime a dozen. But the
Innovation Prize of German Business, which
has been awarded annually since 1980, has
managed to retain its cachet, not least because
it is the oldest award of its kind anywhere in
the world. The inspiration behind the award was the
recognition that the growing scarcity of raw
materials means that the only way to remain
competitive in global markets is to engage in
constant research and innovation. In addition
to computer technology and medical engineer-
ing — two of the major topics common to
prizewinners over the years — recurrent
themes have been solutions to boost energy
efficiency and intelligent ways of using raw
materials.
Never before has the need for efficient
technology been as critical as it is today. Along-
side renewable sources of energy, the main
weapon in the fight to contain climate change
at a manageable level is greater efficiency in
the generation, transmission, and consump-
tion of power (see p. 96). At the same time,
growth in world population and rising levels of
purchasing power in many countries threaten
to cause shortages of raw materials. The think tank Global Footprint Network es-
timates that we are already using natural re-
sources at a rate that is 50 percent higher than
these can regenerate. If this trend continues
we would need two to three earths to support
us by 2050. In other words, increased efficien-
cy, recycling, a circular economy, and con-
sumption geared toward conserving resources
are needed today more urgently than ever be-
fore. The good news is that opportunities to
boost efficiency are at hand practically every-
where. What’s more, such solutions are ex-
tremely attractive for everyone concerned.
80 Pictures of the Future | Spring 2012
A transformer platform at Sweden’s Lillgrund
offshore wind farm steps down the voltage of
electricity generated from wind energy and
then feeds it into the grid. signs, Roman engineering techniques and his-
tory in meticulously duplicated versions of the
original city’s majestic homes. Entrepreneurs
will be opening restaurants, many of them sell-
ing foods very similar to those sold in ancient
Pompeii. And, yes, thousands of people will ac-
tually live here in updated, zero-net-energy
versions of ancient Pompeian villas and apart-
ments. Our order books are full!
Sure, living here may take some getting
used to. If you’re looking for 24-hour car wash-
es, gas stations buzzing with aggressive mo-
torists, or blindingly-lit, heat-trapping parking
lots, you’ll have to look elsewhere! If you miss
streets that can’t be cleaned because of wall-
to-wall vehicles, mopeds that run grandmoth-
ers off of sidewalks, trucks that barrel down
residential streets in the small hours of the
night, “walk” signs that are timed for sprinters,
and a thousand other vehicle-related indigni-
ties and eyesores, please, do yourself a favor,
and don’t come to Pompeii Novum! Here, unlike most other cities, we have an
inspired vision of efficiency. First of all, Pom-
peii Novum will be energy self sufficient. If you
look over my shoulder, past the forum, out to
the sea, you’ll notice a forest of giant wind-
mills, their blades rotating in perfect synchro-
nization with one another to minimize drag-
producing cross currents. Each one produces a
huge amount of electricity. With a view to powering a range of auto-
mated construction equipment, the wind park
and parts of the related energy distribution
and storage infrastructure were one of the first
things we installed. The energy generated by
our windmills is used to desalinate sea water,
fill reservoirs with potable water, and run
dozens of underground electrolyzers. You can
see one of them over here, next to the multi-
story underground tunnel system with one lev-
el for passenger transit via automated electric
vehicles and another level for delivery traffic.
The electrolyzers generate hydrogen gas using
surplus electricity from the wind farm and a gi-
gantic solar system in the desert. The gas is
then converted back into electricity in fuel
cells, or is reacted with atmospheric carbon
dioxide to produce methane. The methane can
then be used as vehicle fuel or as gas for heat-
ing, just like natural gas.
So much for energy generation and storage.
How do we plan to manage energy demand?
First of all, let me tell you about Pompeii
Novum’s Planning and Simulation Center, which
you can see right behind me. There, we started
out with a digital model of the ancient city,
adapted the model to the present site, and
then optimized its buildings and neighbor-
hoods in terms of their individual and collec-
tive energy and infrastructural dynamics and
needs. A program then combed the entire city
model to find the best locations to install mo-
tion, temperature, and carbon dioxide sensors
— proxies for occupancy detection, and thus
the basis for ensuring that heating, cooling,
and lighting would not be wasted. The sensors
are equipped with microchips that can receive
software upgrades via radio. They were in-
stalled by robotic “craftsmen” that provide con-
tinuous feedback as to their own progress. Once the city is inhabited, these systems
will automatically adjust temperature, humidi-
ty and lighting levels in public and commercial
buildings based on how many people are pres-
ent in any given room or common area, and
will do the same in private homes, giving
precedence to the specific demands and habits
of regular users. During warm weather, for in-
stance, these sensing systems will ensure that
the right amount of cool air is drawn from cis-
terns fed by impluvia to provide refreshing,
natural ventilation wherever needed. To give Pompeii Novum’s future inhabitants
an incentive to use as little power as possible, a
standardized protocol will allow all homes and
businesses to receive, interpret, and adjust for
price signals from the city’s power utility as the
price of electricity varies from hour to hour. People will be able to set their thermostats
at whatever temperature they wish. But indi-
viduals competing within family units, house-
holds competing within neighborhoods, and
even departments within larger organizations
will receive rewards such as bonus hours in the
city’s spectacular baths or free tickets to colise-
um events — details provided via smartphone
messages with classic Roman lute or kithara
sound signatures — depending on the extent
to which they manage to keep their energy use
below given targets. In production shops, city maintenance facil-
ities, food preparation centers, and other ener-
gy-intensive operations, many of which will be
underground and entirely automated, groups
of smart tools will organize their processes ac-
cording to the spot price of electricity, thus
helping to keep their products competitively
priced. And of course, a city ordinance will re-
quire all privately and publically purchased en-
ergy-consuming devices in Pompeii Novum to
meet the latest requirements for energy self di-
agnostics and associated maintenance.
Oh my, it’s getting late! Let me just add that
the investors and institutes backing our project
are so excited by the response we’ve had that
they are already thinking ahead to new settle-
ments based on other ancient cities, such as
Alexandria, Leptis Magna, and Herculaneum.
Major hotel chains, retirement community op-
erators, healthcare and fitness associations,
and sports clubs are clamoring to invest with
us. They are saying: “Let the games begin!”
Arthur F. Pease
Advanced systems make the Monte Rosa alpine refuge a practically zero-energy building.
Pictures of the Future | Spring 2012 83
Scientists at the Institute of Mechanics at Moscow State University are investigating heat recovery technologies in industry.
On the other hand, industry already pos-
sesses numerous methods for boosting the ef-
ficiency of industrial processes. What really
counts, however, is to ensure that these meth-
ods are put into widespread use. Globally ori-
ented companies such as Siemens, which op-
erates in 190 countries, have a major role to
play in this regard. “Thanks to our expertise
and our global network, we can take the
knowledge we have acquired in one region
and apply it in other markets,” explains Betten-
hausen. Irrespective of whether such know-
how has been acquired in India, China, Ger-
many, or the U.S., senior figures like
Bettenhausen intend to pool and harness such
knowledge to an ever-increasing extent. “We are setting up a facility in the U.S.
where we will investigate all the best practices
developed by Siemens employees around the
world. We’re calling it the Affordable Urban
Living Lab. This is where our researchers will
be able to build and test their prototypes under
realistic conditions. No matter whether we’re
talking about automation, building systems, or
energy efficiency, the goal will always be to
gather information, process that information,
and convert the results into measures that are
specifically designed to improve efficiency,”
Bettenhausen explains.
From Coal to Gas. In tandem with business,
governments around the world are now start-
ing to show a more responsible attitude to-
ward the planet. Included is China, which is
now the world’s largest energy user and emit-
ter of carbon dioxide. Furthermore, the Inter-
national Energy Agency (IEA) predicts that by
2035 China will be using around 70 percent
more energy than the U.S. The country is al-
ready suffering from the environmental results
of its massive economic growth over recent
decades. According to the World Wide Fund for
Nature (WWF), 16 of the world’s 20 dirtiest
cities in 2008 were in China. To meet the coun-
try’s needs as sustainably as possible, the Chi-
nese government has now resolved to uncou-
ple economic growth from the consumption of
resources and to systematically promote re-
newable energy sources and enhanced energy
efficiency (p. 90).
In the U.S. too, where electricity consump-
tion per capita is almost twice that of Europe,
there are increased efforts to improve efficien-
cy. The government’s Industrial Technologies
Program, for example, offers companies finan-
cial incentives to install energy-efficient tech-
nology. At the same time, the country is
steadily converting its coal-fired power plants
to natural gas, a much cleaner fuel, which can
be used in highly efficient combined-cycle
power plants to produce electricity. “In the cur-
rent decade alone, plants with a combined
output of between 60,000 and 90,000
megawatts could be converted to natural gas,”
says MIT energy expert Moniz. And more gas-powered generating capacity
is on the way, much of it involving turbines
made by Siemens. Operating with a steam tur-
bine in a combined cycle, a gas turbine from
Siemens has set a new world efficiency record,
with 60.75 percent of the energy contained in
the natural gas fuel being converted into elec-
tricity at an output of 578 megawatts —
enough to supply a major city the size of
Berlin. At present, the average efficiency of com-
bined-cycle power plants in the U.S. is less
than 40 percent. In other words, replacing
these with the most efficient turbines from
Siemens would reduce gas demand by one
third. As of 2013, six of these turbines will be
operating in Florida, where upgrades to the
state’s power plants will yield the operator,
Florida Power & Light, net savings of almost $1
billion over the full life cycle of the turbines. This is another example of how a cleaner
environment and a stronger economy can —
and, in the future, must — go hand in hand.
Many experts agree that this kind of sustain-
able model is the only possible option for fu-
ture economic growth. Technologies such as those in Siemens’ new
gas turbine are now leading the way. The jury
of the Innovation Prize of German Business
was of a similar opinion, and in February 2012
it presented the honor to this record-breaking
development.Sebastian Webel
with research by Arthur F. Pease
Other effective ways of reducing energy
use and associated costs include, for example,
the installation of sophisticated energy man-
agement systems, smart software for enhanc-
ing entire production processes (see p. 111),
and technologies to improve the exploitation
of waste heat in industrial facilities (see p.
104). “At present, around half of the primary en-
ergy used for industrial processes and power
generation is lost as waste heat,” explains Dr.
Martin Tackenberg, a specialist in thermal
management at CT in Erlangen. “We are now
running a project to identify and develop a
range of processes to make much better eco-
nomic and environmental use of this wasted
energy. Our goal is to bring down such losses
to a maximum of around 40 percent by 2020.
That would translate into enormous savings in
energy and costs.”
At the same time, industry needs to look at
methods of production that reduce its use of
other resources. This will not only save money
but also reduce exposure to the risks associat-
ed with the increasing scarcity of raw materi-
als. According to a German government
agency that focuses on the efficiency of mate-
rials, introduction of the very latest processes
designed to conserve and recover resources
would save companies in Germany around
€100 billion a year. That’s reason enough for
companies such as Siemens to be developing
new methods to make the most of valuable
raw materials (see p. 107).
82 Pictures of the Future | Spring 2012
Those who manage to reduce their use of en-
ergy or resources, whether at home or in an in-
dustrial environment, without cutting per-
formance or output not only help preserve the
environment but are also rewarded in the form
of reduced expenses and a higher level of com-
petitiveness. Environmental technology has long since
shed its image as expensive and inessential.
Siemens posted revenues of €30 billion in fis-
cal year 2011 from sales of the exceptionally
efficient products and solutions in its Environ-
mental Portfolio. What’s more, this market has
a substantially larger potential. In fact, the
World Business Council for Sustainable Devel-
opment (WBCSD) estimates that business op-
portunities in the environmental sector will to-
tal as much as $6.3 trillion a year by 2050. Making Buildings More Efficient. Much of
this expected business volume will be generat-
ed by improvements made to the energy effi-
ciency of buildings, which are currently re-
sponsible for around 40 percent of all energy
use worldwide and thus for 20 percent of
worldwide greenhouse gas emissions. “The
best way to save energy is to not use it in the
first place. And one of the best ways of doing
this is to develop energy-efficient buildings,”
says Kurt Bettenhausen, who heads the
Siemens Corporate Technology (CT) Research
Center in Princeton, New Jersey. Many of the technologies required for this
purpose are available today, including intelli-
gent facility automation and energy manage-
ment systems (see pp. 84, 86). In an interview
with Pictures of the Future (p. 88), Prof. Ernest
J. Moniz, an energy expert at the Massachu-
setts Institute of Technology (MIT) and a mem-
ber of President Barack Obama’s Council of Ad-
visors for Science and Technology (PCAST),
explained exactly what savings can be made
with such technologies: “The National Acade-
my of Sciences published a study in 2008
showing that just the modernization of today’s
stock of real estate would reduce total energy
use in the U.S. by around one fifth by 2020.” In
the future, moreover, buildings will not only
use less energy, but will also help relieve
strains on the power grid. Software will fine
tune power demand in thousands of buildings
in response to changes in the price of electrici-
ty, thus reducing collective demand in real-
time. This will help to flatten peaks in overall
demand — a cost-efficient means of stabilizing
the power distribution grid (see p. 46). According to Bettenhausen,
more research is required to
make national economies as
sustainable as possible. “I’m
thinking primarily of areas such
as energy storage and the cap-
ture, sequestration, and usage
of CO
2
as a raw material,” he
says. The re-use of carbon dioxide could be of
particular interest to industry. Siemens, for in-
stance, is researching the use of algae to con-
vert CO
2
into biomass — thereby generating a
raw material for biofuels, bioplastics, or animal
feed — and it is also investigating ways of us-
ing CO
2
in chemical processes (see p. 103). Elsewhere in industry, R&D activities are fo-
cused on ways of boosting energy efficiency.
Electric motors offer by far the richest potential
for savings here, since they account for around
60 percent of the electricity consumed by Eu-
ropean industry. In China, the proportion is as
high as 80 percent. The use of efficient motors
and smart control technology can reduce pow-
er demand in this area by as much as 60 per-
cent. Normally, this kind of investment will pay
for itself within two years, following which the
customer begins to profit from the substantial
reductions in energy consumption. New technologies are making fossil-fuel facilities more efficient. Left: A combined-cycle plant in Irsching, Germany and the Waigaoqiao 3 coal-fired plant in Shanghai. Electric motors use around 60 percent of the electricity consumed
by European industry. Pictures of the Future | Spring 2012 85
Spikes in energy demand are forcing power companies to spend billions of dollars on “peaking” facilities that are rarely used. Smart building automation systems capable of trimming demand for electricity in response to real-time variations in prices could collectively shave many peaks and help to cost-effectively stabilize entire generation and distribution networks.
Buildings that Change their Behavior
fication can be complicated because many ap-
pliances have a variety of cycles. “But we have
found ways of isolating each cycle and then re-
combining them as a signature for a single de-
vice,” says Kuhns. “This can lead to identifica-
tion of distinct activities within a device, such
as an energy-intensive hot water heating cycle
in a dishwasher. The technology can even be
used in conjunction with a store’s schedule to
detect inefficient timing of systems.”
At regular intervals, information regarding
a device’s actual energy demand is compared
to its publicized demand and to the electrical
demand of competing devices. Finally, if signif-
icant discrepancies are identified, LoadIQ tech-
nology can generate a report for the owner
recommending that the device be serviced or
replaced. The winner of a 2011 California Clean Tech
Open Energy Efficiency Award and recipient of
a National Science Foundation (NSF) Small
Business Innovative Research (SBIR) Phase II
grant, LoadIQ is about to begin testing its tech-
nology in small commercial settings. path, over the next ten years, the U.S. will have
to build as many as 1,900 additional peaking
plants in order to keep up with increasing de-
mand.”
But as companies across the U.S. and
around the world develop their own responses
to sudden peaks in electricity prices, they are
beginning to shine light on how the entire
problem of peak demand can be managed.
RCS’s IT-based Intelligent Load Management
(ILM) building automation platform, for in-
stance, not only reduces everyday electricity
demand, but, thanks to its ability to respond to
market signals from a utility, holds the poten-
tial for responding to variations in electricity
prices on a 24/7 basis. Indeed, with a view to
extending the ability of Siemens-controlled
F
rom fast food outlets to soaring office tow-
ers, buildings come in all shapes and sizes.
But most of them have two things in common:
a voracious appetite for energy and a huge po-
tential for efficiency improvement. In fact, ac-
cording to U.S. and German government statis-
tics, residential and commercial buildings
consume 40 percent of primary energy world-
wide and are responsible for producing 21 per-
cent of total carbon dioxide emissions.
How much of this energy could be saved?
“Depending on the building, anywhere be-
tween 25 and 50 percent,” says Thomas
Grünewald, head of Siemens Corporate Tech-
nology’s High Performance Building research
project and an authority on energy-saving
technologies for buildings and cities. Statistics from Siemens Retail and Commer-
cial Systems (RCS), a U.S. company that spe-
cializes in energy management for large chains
of stores, bear him out. In spite of the rising
cost of electricity, the company’s customers
have seen their electric bills drop between 15
and 30 percent (for more, see page 86). With
Formulas for Efficiency | Load Management
Shaving Demand for Peaking Plants. The
need to enhance efficiency and reduce electric
bills is not limited to individual businesses and
consumers. Indeed, in many countries, the sta-
bility of entire electricity generation and distri-
bution networks is at stake (see Pictures of the
Future,Fall 2009, p.34). For instance, if electri-
cal demand approaches the limit of capacity,
brown outs (a drop in voltage) or rolling black-
outs may occur. To avoid such disruptions,
power companies generally switch on so-
called “peaking” plants. But because such
plants are only rarely activated, they are ex-
tremely expensive to operate. The result is a
sudden spike in the price of electricity that can
amount to several hundred percent per kilo-
watt hour. “In the U.S., ten percent of the entire ener-
gy generation and distribution infrastructure is
there to provide peaking power that is needed
only one percent of the time,” explains Dr.
George Lo, a specialist in automation and a
“Siemens Top Innovator” at Siemens Corporate
Technology in Princeton, New Jersey. In view
of this, utilities clearly want to avoid peaks be-
cause by doing so they defer the cost of invest-
ing in new peaker plants. “Nevertheless,” says
Lo, “if we continue down a business-as-usual
84 Pictures of the Future | Spring 2012
commercial buildings accounting for 46 per-
cent of all the energy consumed by buildings
in the U.S., RCS’s potential long-term effect on
energy demand could be enormous.
French Fries and an Energy Analysis. Work-
ing along similar lines, Reno, Nevada-based
LoadIQ, a startup funded by the Siemens Tech-
nology-to-Business Center in Berkeley, Califor-
nia, has come up with a technology that could
cut the electric bills of the U.S.’s 70,000 fast
food restaurants by a significant amount. After
a training phase, the technology uses ad-
vanced signal processing to associate changes
in power consumption reaching a restaurant’s
electric meter with individual devices, such as
ovens, fryers, and refrigeration units. “The sys-
tem looks at the change in power each time an
appliance turns on or off,” explains LoadIQ
CEO Dr. Hampden Kuhns. “Each change is char-
acterized by a unique signature. For instance, a
50W resistive incandescent light and a 50W in-
ductive fluorescent light have completely dif-
ferent signatures.” Nevertheless, device identi-
A Siemens Apogee building automation system at a
UC Berkeley research center (this page and left p. 85)
and new technology from LoadlQ (right), help mini-
mize load peaks in electricity distribution networks.
buildings to participate in building-to-grid pro-
grams, ILM capabilities will be integrated into
Siemens’ Apogee building automation system
product later this year, thus allowing thou-
sands of Apogee buildings to function as if
they were a single electricity user, therefore
further reducing the need for rarely-used peak-
ing power plants. “If significant numbers of
buildings were to operate on this basis, the col-
lective effect would be the elimination of
peaks and an automatic real-time leveling of
electrical loads,” says Lo.
A Box that Controls a Building.
Figuring out exactly how to
achieve that, particularly in very
large, multi-use buildings, is one
of the ambitious goals of energy
efficiency experts at Saturdja Dai
Hall, the newest research facility on the cam-
pus of the University of California, Berkeley
(UCB). Outfitted with a Siemens Apogee au-
tomation system, Saturdja Dai Hall functions
as a test bed for building-to-grid technologies
such as automated demand response (ADR). In
order to ensure that a building’s response to
changing electricity prices is both automated
and intelligent, Siemens Corporation, Siemens
schedules, habits and energy priorities of dif-
ferent departments within a building. Exclud-
ing those areas of a building that are off limits
in terms of power adjustments because of vital
or very high-value functions, the Smart Energy
Box minimizes inconvenience by maximizing
the distribution of its demand response over as
many systems as possible. Essential to this entire process is a protocol
that allows building automation systems to
read ADR signals from utilities. Developed by
the Laurence Berkeley National Laboratory
(LBNL) and recently adopted by the U.S. De-
partment of Energy, the “OpenADR” protocol is
rapidly moving toward worldwide acceptance
and may well become the standard for build-
ing-to-grid communications. “This is extremely
important,” says Prof. David M. Auslander of
the UCB Mechanical Engineering Department
and a key advocate of the university’s partici-
Corporate Research (CT), and Siemens Building
Technologies are working with UCB to test a
CT-developed “Smart Energy Box” at Saturdja
Dai. “The idea is that when a peak is predicted,
the Box goes through a library of scenarios
that range from reduced cooling and lighting
in non-critical areas to a finely-tuned, distrib-
uted response that can include almost any-
thing that’s plugged into a wall socket. It takes
expected prices and weather conditions into
account, including where the sun will be in re-
lation to the building during a DR event,” ex-
plains Lo, “Finally, it chooses the best scenario
and implements it.”
To achieve such a response without incon-
veniencing building occupants can be a tricky
task. It calls for the ability to learn from the
pation in this technology. “LBNL is testing Ope-
nADR at several hundred facilities. And Saturd-
ja Dai Hall is one of them — thanks to the Ener-
gy Box. The issue is that the wholesale price of
electricity varies from minute to minute, but its
retail price often looks flat. The Energy Box
could change that — essentially transforming
electricity from a fixed part of overhead to an
expense that can be actively managed.” Adds Saturdja Dai Building Manager Dome-
nico Caramagno, “Thousands of buildings
could benefit from this box, not only to shed
load during demand-response events and thus
benefit from cash incentives from utilities, but
to maximize their energy savings around the
clock. That is the direction we are heading.”
Arthur F. Pease
A new technology could cut the
electric bills of the U.S.’s 70,000 fast food outlets significantly.
Winter Spring Summer Fall
0
20
40
60
80
90
100
%
Load shifting
Peak
shaving
Pictures of the Future | Spring 2012 87
There are one and a half million commercial buildings in the U.S. Less than ten percent of them have energy management systems. Technology from a new Siemens company in Austin, Texas has what it takes to steadily ramp down this huge sector’s appetite for energy.
Starving the Energy Monster
needed on a real-time basis — and connects
thermostats and lighting controls to a control
box with its own Linux-based computer and
embedded Web server. Depending on the cus-
tomer, other major systems such as refrigera-
tion units, trash compactors, signage, rooftop
solar power equipment, and electric vehicle
charging stations can also be equipped with
sensors.
Each store’s control box interrogates its sen-
sors every sixty seconds and delivers a condi-
tion report to the chain operator’s headquar-
ters every two hours. What’s more, every four hours, a cloud-
based RCS data management center generates
a prioritized list of the specific systems in a
chain operator’s entire fleet of stores that re-
quire immediate service. “It’s like monitoring
patients in an intensive care unit,” says RCS
General Manager Marcus Boerkei. “Our soft-
ware keeps an eye on each store’s energy-re-
lated vital signs, identifies equipment that is
not operating at specified levels, prioritizes
problems, and generates actionable informa-
tion that focuses the customer’s attention on
those stores that need help.”
A
lthough high-profile measures to slow
global warming seem to be eternally stuck
in neutral, a combination of technology and
market forces offers the potential of putting a
significant dent in energy demand and carbon
dioxide emissions in the United States. Accord-
ing to a 2009 McKinsey report entitled Unlock-
ing Energy Efficiency in the U.S. Economy
, the
commercial sector, which includes everything
from office and retail buildings to hotels,
restaurants and warehouses, will account for
20 percent of all the energy used in the U.S. by
2020, or about 20 quadrillion BTUs of primary
energy.
But even as average energy demand per
square foot continues to grow at 1.5 percent
per year throughout this vast sector, the cus-
tomers of an Austin, Texas start-up company
that provides enterprise-level energy manage-
ment for chains of mid-sized retail facilities
such as health clubs, supermarkets and branch
banks are demonstrating that a completely dif-
ferent course is possible. In spite of the rising cost of energy, their
electric bills have steadily headed south — typ-
ically between 15 and 30 percent over a 28- to
Formulas for Efficiency | Networked Buildings
Enterprise-wide Overview. Adds RCS Busi-
ness Development Director Dan Kubala, “Until
we came to this market, no one had the tools to
do this sort of thing. Typically, our customers
have a number of cooling units on the roof, all
supplying a common sales area — think ‘big
box’ store. If one malfunctions, it may actually
be pumping hot air into a store, forcing the oth-
er units to work even harder. But without the
ability to automatically identify such situations,
no one notices, except that energy bills just
keep climbing.” Even worse, he says, are techni-
cians who go to the roof, do little or nothing,
and bill a store for their services. “Without re-
mote sensing, there is no mechanism to verify
whether a job was actually done,” he says. Careless store managers can also be a prob-
lem. “What we absolutely want to avoid,” says
Kubala, “is the manager who turns the thermo-
stat down to 66 on a hot day and then leaves it
there for the entire summer. With our system,
corporate energy managers receive regular up-
dates on temperature settings across their entire
enterprise, enabling them to prevent this behav-
ior.” In view of these and other causes of locally-
induced energy waste, RCS software allows
86 Pictures of the Future | Spring 2012
36-month period, resulting in an extremely
rapid return on investment. Seeing a perfect
match with its market-leading position in the
automation and energy optimization of very
large buildings such as hospitals, office towers
and stadiums (for more, see page 84),
Siemens Building Technologies (SBT) acquired
the Austin startup — then known as Site Con-
trols — in late 2010. Now an SBT unit known as Retail & Com-
mercial Systems (RCS), the company is helping
a wide range of customers with sites across the
United States and Canada not only to reduce
their energy bills, but to hone their facility in-
telligence and come up with smart grid solu-
tions.
Intensive Care for Stores. RCS specializes in
chains of stores in which the buildings are es-
sentially the same. In each case, it outfits the
heating and cooling units in customer facilities
with sensors designed to continuously monitor
equipment performance, equips customer ar-
eas with wall-mounted carbon dioxide sensors
as a proxy for occupancy detection — a key pa-
rameter in determining how much cooling is
By continuously monitoring all major electrical systems in a chain store’s outlets, Siemens Retail and
Commercial Systems is helping major operators such
as Michaels to steadily reduce their electric bills. Michaels Stores: The Art of Achieving More with Less
With over 1,000 stores in North America,
Michaels is the largest retailer of arts, crafts, and as-
sociated merchandise in the U.S. It is also one of a
small but growing number of major U.S. companies
to implement consistent policies designed to im-
prove its bottom line through reduced energy use.
“Energy is our second highest line item expense behind labor,” says Robin Moore (above), Vice President
for Store Development and Construction at Michaels. With this in mind, the company has equipped al-
most all of its stores with Siemens’ RCS energy management platform. The result, according to Moore,
has been spectacular. “Through our initial energy management system deployment and continuous im-
provements with Siemens’ Client Services group, we have saved approximately 25 percent. Recently de-
ployed extensions take those savings even further. And that has been achieved in spite of regular elec-
tricity rate increases.” Having achieved such dramatic savings, you might think that further improvements would be tough to
realize. “That’s true,” says RCS General Manager Marcus Boerkei. “But we have a rapid innovation cycle
that allows us to generate new apps every one to three months.” One recently-introduced improvement
is the use of so-called “psychrometric” data. “The idea,” he explains, “is to take both temperature and hu-
midity into account. For instance, if the outside air becomes dryer, the temperature set points in a store
will automatically adjust upwards by 1.5 to 2 °F without producing any noticeable difference for shop-
pers — but saving even more energy.”
Michaels expects to shave its electric bills even further in the future. “One major item we are looking for-
ward to,” says Moore, “is having Siemens automate lighting levels throughout our fleet. When you add
up all the benefits of our energy management system,” she adds, “I just can’t imagine why other retailers
are not doing what we are doing. The value that we have gotten out of our partnership with Siemens
has been wonderful. The payback is there.”
Chain store operators typically have hundreds of
nearly identical outlets. When outfitted with
sensors and a Web-based Siemens control box,
each store’s electrical systems (above) can be re-
motely monitored. Siemens software at the cus-
tomer’s headquarters uses the information to
identify energy-related anomalies and generate
prioritized maintenance reports. In North Amer-
ica, lighting and heating, ventilation and cooling
(HVAC) are the major energy users (left).
Real-time Energy Use (at meter)
RTU Performance
Rooftop Solar
Indoor Lighting
Network Controller Unit Trash Compactor
Internet Connection
Wind Turbine
Signage
Outdoor Lighting
HVAC Supply Temperature Sensors
Outside Temperature
Indoor Air Quality (IAQ)
via CO
2
Sensor
Battery Storage
Refrigeration
Networked Smart
Thermostats
Optional Cellular Modem
Lighting
59%
HVAC
25%
Other
12%
Water Heating
1%
Food Service
3%
Source: Chain Store Information Guide, Edison Electric Institute
Source: Siemens Retail & Commercial Systems building sector, they have made tremendous
progress.
Is the competitiveness of U.S. products at
risk as a result of a lack of emphasis on
energy-saving technologies?
Moniz:Energy cost is one factor in gauging
manufacturing com
petitiveness. While impor-
tant, I w
ouldn’t say it’s a dominant factor.
Why isn’t the U.S. moving more decisively
toward efficient use of energy?
Moniz:Two reasons. First, the energy busi-
nes
s is a multi-trillion-dollar-per-year business.
It is a highly capitalized business with as
sets
that have many decades of life on the supply
side. It is a commodity business. It is an essen-
tial service business for society, which means
that reliability is valued over innovation. It is a business that has developed incredibly effi-
cient supply chains. It is a highly regulated
business — a factor that will never change because of the services it supplies. And being
highly regulated, it attracts much political in-
terest. All in all, this is a very slow-moving
business with major incumbency questions. The second issue is that energy efficiency in-
volves an up-front capital investment for a life
cycle economic benefit. And it is often difficult
to overcome that hump. Policies that can
translate energy efficiency into consumer savings are important. Instruments such as energy service contracts — where someone
makes an investment for you and then shares
the benefit — are interesting. But here too we
are confronted with a major problem: Because
states, and in some cases towns, have jurisdic-
tion over energy generation and distribution,
we do not have a national policy. I personally
believe that many of our problems cannot be
addressed efficiently without a greater degree
of uniformity in electricity regulation across
the country. If you look at industries such as
trucking, airlines, and telecommunications,
they have all experienced pretty fundamental
changes in terms of their regulatory footprint
in the last quarter century. The electricity sector, on the other hand, still reflects a 1930s
regulatory structure in many ways. This does
not align with the physical and digital reality
of the grid today. It is a fundamental mis-
match.Interview by Arthur F. Pease.
Pictures of the Future | Spring 2012 89
tion, natural gas for coal, and accelerated in-
novation toward economically attractive zero-
carbon solutions. Demand-reduction is hap-
pening to some extent with actions such as
the new fleet mileage policy for vehicles,
which I mentioned earlier. But the really big
untold story is the substitution of coal with
natural gas. Already, as a result of increased
gas use, coal use for the production of electric-
ity in the U.S. has fallen from about 50 percent
a few years ago to 45 percent last year. And
utilities have identified nearly 20,000 MW of
coal-fired electricity generation for shutdown,
with inexpensive natural gas as the replace-
ment. Also, thanks to the recently announced
restrictions on mercury emissions, as required
by the Clean Air Act, 60,000 to 90,000 MW of
generating capacity could migrate from coal
to natural gas generation in this decade. All in
all, this could amount to as much as a 20 per-
cent reduction in CO
2
emissions in the U.S.
electricity generation sector — a trend that
would put the U.S. on a very reasonable tra-
jectory in terms of CO
2
emission reduction.
More than 50 percent of primary energy
is lost in the form of heat. What can be
done here?
Moniz:There is a great deal of untapped po
tential in the U.S. in the ar
ea of combined
heat and power. A study conducted about ten
years ago found that just on the institutional
level — hospitals, universities, etc. — there
was probably on the order of 80,000 MW of
potential in the U.S. MIT has used a cogenera-
tion system for electricity, heating and cooling
for 15 years. Utilities are becoming increasing-
ly interested in this because tapping into ther-
mal management solutions can mean that
they do not have to build peaking power
plants or make additional investments in
transmission and distribution. A number of U.S. cities use district heating — indeed,
New York city has used it since the late nine-
teenth century — and there is growing inter-
est in this area. Still, the U.S. is behind Europe
and Canada in this regard.
Which countries are making meaningful
progress in improving energy efficiency?
Moniz:Germany is the best example that I
kno
w of in this regard. Particularly in t
he
that closed doors would reduce the number of
consumers reaching for items. But the study
found that the presence of doors reduced
costs not only through reduced energy bills
but also because consumer behavior led to
less reshelving needs. Signage is another
lever. For instance, students here at MIT have
experimented with signs informing users that
swinging doors exchange about eight times as
much air as revolving doors. They found that
the signs did indeed influence behavior.
What impact do energy labels for appli-
ances, lighting products and vehicles
have?
Moniz:Consumer information on energy effi-
ciency is incr
easingly important as gasoline
and electricity prices rise and as concern for
t
he environment grows. Consumers also in-
creasingly associate efficient products with
quality, be it Energy Star labels for appliances
or Leadership in Energy and Environmental
Design ratings for buildings. The European
move towards labels that reflect energy, emissions, ecology, and ergonomic factors is very interesting.
As a member of the President’s Council of
Advisors for Science & Technology —
PCAST — what energy efficiency policies
have you proposed or supported?
Moniz:Of all the challenges to the energy syst
em in this country, the one th
at I believe
remains the overarching challenge is the de-
velopment of a timely response to the risk of
climate change. That is even more important
than energy security. And clearly, if we want
to respond to the risk of climate change, then
we must go to the very heart of our energy
supply system and its basis in fossil fuels. In
view of this, the answer to the problem is very simple: put a price on carbon dioxide. Regardless of how that is implemented, it
would stimulate technology development and
alter behavior through price signals. Demand
management provides the least costly near
term options.
What should the U.S.’s long-term agenda
be for improving its energy efficiency?
Moniz:Three elements are essential for U.S.
ener
gy policy in the near term: Demand reduc-
88 Pictures of the Future | Spring 2012
Ernest J. Moniz is a physics
professor and Director of the
Laboratory for Energy and
the Environment at MIT,
where he has served on the
faculty since 1973. Dr. Moniz served as Under Sec-
retary of the Department of
Energy from 1997 to 2001
and, from 1995 to 1997, as
Associate Director for Sci-
ence in the Office of Science
and Technology Policy in the
Executive Office of the Presi-
dent. He is currently a mem-
ber of the President’s Coun-
cil of Advisors on Science
and Technology. Dr. Moniz
holds a doctorate in theoret-
ical physics from Stanford
University.
How to Cut CO
2
Emissions — Even Without an Energy Policy
Formulas for Efficiency | Interview
It is often said that energy efficiency has
the potential of being the single biggest
contributor to meeting the world’s ener-
gy needs. What are your views on this?
Moniz:Energy efficiency is very important,
but it needs t
o be aligned with policies that
capture its benefits — policies designed to r
e-
duce energy demand. For example, the inter-
nal combustion engine has become increas-
ingly efficient. But in the U.S., the benefits of
that efficiency have not been reflected in re-
duced energy use. Instead, the enhanced effi-
ciency has allowed more horsepower for the
same energy use. What are the key areas in which energy
efficiency goals can be aligned with poli-
cies to reduce demand?
Moniz:In terms of greenhouse gas emissions,
t
here are two areas. One is electricity supply to
residential and commer
cial buildings. That
area alone consumes roughly 70 percent of
commercially-produced electricity in the U.S.,
roughly half of which is produced by coal. The
second focal point is oil for transportation. As
a result, there are four primary leverage points
for addressing carbon dioxide emissions’ chal-
lenges: Build efficient buildings and vehicles,
de-carbonize electricity, and emphasize low-
carbon fuels. That’s the agenda.
Let’s look at buildings. What’s the ener-
gy-saving potential of systems that help
to manage electricity consumption?
Moniz:There is no question about the ener-
gy
-saving potential of demand-response tech-
nology
. In 2008 the U.S. National Academy of
Sciences published a report that estimated
that by 2020, even with the existing building
stock, we could reduce energy use by about
18 quadrillion BTUs per year through efficien-
cy projects that would have a reasonable pay-
back period. And that was just through de-
mand response in buildings. On the simplest
level, this amounts to agreements between
energy providers and major consumers where-
by the consumer agrees to cut usage by a set
amount during periods of high demand. Total
energy use in the entire U.S. is roughly 100
quads. So 18 quads is a very large number. But
getting this implemented in the absence of a
federal regulatory climate is difficult.
In terms of transportation, new mileage
standards were recently introduced…
Moniz:Correct. New standards will double
t
he average fleet mileage requir
ement from
27.5 to 54 miles per gallon over the next 12
years. That amounts to a very substantial im-
provement in efficiency.
In addition to technological and econom-
ic levers, what can be done to motivate
people to use less energy? Moniz:Consumer behavior can play an impor-
t
ant role in saving energy. For exam
ple, Wal-
mart performed a study to see how customer
behavior changes if frozen foods are in closed
glass compartments rather than energy-wast-
ing open freezers. Retail experts had expected
headquarters to set each store’s temperature
and lighting levels and coordinate these levels
with store operating hours, weekend and holi-
day peaks, and seasonal changes. What’s more,
as RCS learns from best practices, it remotely de-
ploys new, customer-approved capabilities
across the entire enterprise as a free service.
Thanks to cloud-based data management
and continuous data harvesting, RCS software
also helps chain operators to, for instance, iden-
tify which cooling systems work best in which
climates, and which ones have the best service
and efficiency records. “All of this information
helps to optimize functions in existing facilities,
and supports the planning of new facilities,”
says Boerkei. “It also allows a customer to look at
fleet performance, compare it year on year, and
even compare how his fleet is doing compared
to the industry average in real time.”
Toward Virtual Power Plants. In addition to
steadily driving down chain operators’ energy
costs and providing business intelligence, RCS
helps its customers to make the most of oscil-
lating electricity prices and receive cash from
utilities for reducing electricity demand during
peak periods. The company’s SureGrid intelli-
gent load management (ILM) technology,
which is a standard part of its solution, “essen-
tially turns a building into a fully automated
system that can shed demand in response to
market signals from a utility,” says Boerkei. “If,
for instance, the price per kWh jumps from 6
cents to 13 cents, the building can power
down a range of functions that have previously
been agreed to by the customer depending on
circumstances.”
As RCS adds more and more buildings to
the thousands it already controls, the aggre-
gate effect of reduced demand can have a sig-
nificant impact on local utilities. Incentivized
by contracts that pay utility customers for each
kW they shed below a predefined minimum, so
many buildings already participate that utilities
are able to avoid switching on so-called peak-
ing plants. “The result is that aggregations of
RCS-equipped buildings participating in a de-
mand-response event start to look like virtual
power plants,” says Boerkei. Normally, howev-
er, some buildings would be unable to reduce
demand — think of a popular restaurant on a
Friday night, for instance — and would be pe-
nalized with very high electricity prices. With
this in mind, RCS bids the aggregate load of its
buildings to the utility. “That way the individual
site can do what it needs to do. It’s like a diver-
sified stock portfolio,” says Boerkei. “We nego-
tiate with our customers and split the re-
wards.” As RCS expands into more and more
chains of buildings, there are likely to be plenty
of rewards — particularly for the environment.
Arthur F. Pease
Pictures of the Future | Spring 2012 91
China is regarded as this century’s economic miracle. Yet for a long time, its stunning growth came at the expense of the environment. But times have changed. Today, the country’s top priorities
include boosting efficiency, reducing emissions, and creating environmentally-sustainable cities. Sustainability Boom
90 Pictures of the Future | Spring 2012
According to the International Energy
Agency (IEA), oil consumption is set to rise by
70 percent between 2009 and 2015. By 2015
China is expected to account for 42 percent of
global oil demand. In a similar vein, the IEA es-
timates that China’s power consumption rose
by 200 percent in the past decade and that its
water consumption could double by 2030 (see
Pictures of the Future,Fall 2011, p. 82).
For a long time, these trends took a toll on
the environment. In fact, China is currently re-
sponsible for around one fourth of energy-re-
lated CO
2
emissions worldwide and is already
the world’s largest producer of greenhouse
gases, ahead of the U.S. According to a 2008
report by the World Wide Fund for Nature
(WWF), 16 of the 20 cities with the worst air
quality around the globe were Chinese. Yet the
country is mindful of this problem and has be-
gun to take action to remedy it. “In 2006, China’s 11th five-year plan
marked a paradigm shift in the country’s atti-
tude toward sustainability,” says Martin Klarer,
who is responsible for corporate strategy at
Siemens China. “Environmental protection and
enhanced efficiency are now major elements
of China’s economic plans.”
World Champion Wind Harvester. The use
of wind power is a prime example. “Less than
ten years ago, there was almost no wind gen-
eration here,” Klarer explains; “but today China
is the world’s largest wind energy market and
home to some of the world’s largest wind pow-
er companies.” What’s more, this is a growing
market. According to the newspaper Shanghai
Daily, in 2011 China generated some 70 ter-
awatt-hours (TWh) — 70 billion kilowatt-hours
(kWh) — by means of wind power, an increase
of 40 percent over the previous year. A
t a celebration to mark the Chinese new
year on January 23, 2012, there were
many more fireworks in evidence than had
been the case in previous years. That’s because
2012 is the Year of the Dragon, which is said to
bring happiness and success. As a conse-
quence, the whole country expects birthrates
to soar. According to popular belief, children
born under the sign of the dragon are blessed
by good fortune.
If forecasts produced by the United Nations
are accurate, China’s population, currently at
1.34 billion, will reach 1.4 billion by around
2025. At present, with half of the country’s
people already living in cities, the economy is
growing at around ten percent a year and has
been doing so for quite some time. Although
this trend has rescued millions from poverty, it
has also unleashed an immense hunger for
goods, resources, and energy. Formulas for Efficiency | China
zhen in the southern Chinese province of
Guangdong with 5,000 MW of clean power
generated by hydropower plants in Yunnan,
some 1,400 kilometers away. Compared to the
emissions associated with coal-fired genera-
tion, the region produces 30 million metric
tons less CO
2
a year thanks to the new line (see
Pictures of the Future,Fall 2009, p. 24). China’s utilities are planning a crop of addi-
tional HVDCT lines, 14 of which are due for
completion by 2015. Two of these are being
built by Siemens, CSG, and other Chinese part-
ners. Featuring transformers, converters, and
other key Siemens components, these two
lines will transmit an additional 11,400 MW of
clean power to Guangdong from 2013 on-
ward.
Exploiting Savings Potential At present,
mega cities such as Beijing and Shanghai can
When it comes to industry, however, the
authorities have opted for binding legislation.
This is because industrial electric motors are
the largest consumers of power in China. Ac-
cording to China’s National Development and
Reform Commission (NDRC), they account for
around 60 percent of domestic power con-
sumption. “Less than three percent of industri-
al motors in China carry the Chinese energy ef-
ficiency rating of 2 or better,” says Du Bin,
product manager at Siemens Drive Technolo-
gies in China. Yet this is set to change. Since July 2011, all
industrial motors sold in China must have an
energy efficiency rating of at least 2. Potential-
ly, this represents a massive reduction in costs.
“If all the industrial motors in China were
swapped for more energy-efficient models,
consumption would fall by around 60 TWh a
year. CO
2
emissions would decrease by 50 mil-
bines; but later we’ll build 3.6 MW models and
even 6 MW ones.” The fruits of this labor are al-
ready visible in Jiangsu province on China’s
east coast, where Siemens has installed an off-
shore wind farm with 21 wind towers and a to-
tal output of 50 MW. “We also have firm orders
from other countries, including Thailand,” adds
Bjarne Joergensen, head of the rotor blade
plant.
Traditional Hydroelectricity. Whereas the
use of wind power is a recent phenomenon,
hydroelectricity has been an integral part of
China’s energy mix for 100 years. A century
ago Siemens installed generators with a com-
bined output of 480 kilowatts (kW) in the
country’s first hydroelectric plant, located in
Yunnan province in southwest China. It was
the start of a unique boom. Today China has
more hydroelectric facilities than any other
country. With a combined output of 197 GW,
these plants contribute some 15 percent of the
power consumed in China. According to the
China Electricity Council, around 4,700 TWh
were consumed in 2011 — almost eight times
Germany’s annual energy requirements.
Nonetheless, the lion’s share of the power
consumed in China’s huge cities is still generat-
ed by coal-fired plants. Along with the rapidly
rising tide of traffic, this is
one of the major causes of
the country’s serious smog
problems. “The challenge is
that the majority of China’s
hydropower is generated in
remote southwest provinces,
hundreds of kilometers from
the nearest population centers,” says Klarer.
The remedy is to use high-voltage direct-cur-
rent transmission lines. These low-loss lines
can transmit huge amounts of power over
hundreds or thousands of kilometers.
One such HVDCT line built by Siemens and
electricity provider China Southern Power Grid
(CSG) has been operating since 2010. It sup-
plies the major cities of Guangzhou and Shen-
only dream of tapping any form of clean power
in quantities such as these. They still rely large-
ly on electricity generated by coal-fired plants.
Here, ways of bringing about a lasting reduc-
tion of CO
2
emissions include improved gener-
ating efficiency, smarter usage of power, and
demand reduction strategies — primarily in in-
dustry, but also in private households. As of
2008, for example, all Chinese homes have
been able to purchase subsidized energy-sav-
ing bulbs for a tenth of their original price. In
the first year of this campaign, 62 million low-
energy lamps were sold; the figure has since
exceeded 120 million. In Beijing alone, there
are 15 to 20 million energy-saving bulbs in use
thanks to this campaign. Compared to conven-
tional incandescent bulbs, this means savings
of up to one billion kilowatt-hours per year.
By distributing around 120 million
compact fluorescent lamps, China
has significantly cut its electricity bill. Thanks to its strategic commitment to renewable technologies, China is investing heavily in wind power and electrical mobility. First image right: A Siemens rotor blade plant near Shanghai. Center and far right: Siemens charging stations.
China is planning to install wind turbines
with a total capacity of 150 gigawatts (GW) by
2020. That’s equivalent to almost the total
combined renewable and conventional in-
stalled capacity in Germany. It is also worth re-
membering that at the end of 2006 China’s
wind power capacity was a mere 2.6 GW.
In other words, wind energy is a major mar-
ket of the future in China. As the world leader
in offshore wind power installations, Siemens
is thus looking to capitalize on this expansion,
not least because of the huge potential in this
segment of the industry. With shallow waters
extending many kilometers from its coastline,
China offers ideal conditions for offshore wind
farms. With this in mind, in spring 2011
Siemens opened a facility that produces na-
celles for wind power plants in close proximity
to an existing rotor blade plant. Located close
to Shanghai, right on the East China Sea, the
facilities have an annual capacity equivalent to
a generating output of 500 megawatts (MW).
“We’re supplying not only China but practi-
cally the entire Asian market as well,” says Vic-
tor Li, head of turbine production at Siemens,
China. “For now, we’re producing 2.3 MW tur-
Here, projects include the coal-fired Waigao-
qiao No. 3 power plant. With turbines and gen-
erators from Siemens, the plant boasts a net
efficiency of 46 percent, one of the highest in
the world for a facility of this type. This plant,
which was commissioned in 2008, consumes
around 700,000 metric tons per year less than
a standard Chinese coal-fired plant; its corre-
sponding CO
2
emissions are around 1.8 million
metric tons lower.
92 Pictures of the Future | Spring 2012
lion metric tons,” says Du Bin. In collaboration
with colleagues in Germany, Siemens Drive
Technologies in China has developed a more
efficient electric motor for the Chinese market,
where it is already being manufactured. “Our
motor is designed to be inexpensive, robust,
and very easy to operate. Because it also con-
forms to the standards of the International
Electrotechnical Commission (IEC), it is sure to
be marketed worldwide,” adds Du Bin. There is also huge potential for improving
the efficiency of China’s coal-fired power
plants, which cover around four fifths of the
country’s electricity needs. Take Shanghai, for
example, with its population of 23 million.
Here, daily power consumption can rise to as
much as 20 GW and is currently increasing by
around 1 GW every year. In order to provide a
sustainable response to this huge demand, city
authorities have turned to new technology.
China’s most efficient combined cycle pow-
er plant, which also relies on Siemens turbines
and generators, is located nearby. The facility,
which is operated by Huaneng Shanghai Com-
bined Cycle Power Co., LTD, has an output of
1,200 MW and an efficiency of 58 percent.
Commissioned in 2006, its job is to cover the
huge peaks in demand that can rock Shang-
hai’s power grid on particularly cold or hot
days. “Compared to a coal-fired plant, the ad-
Thanks to high voltage direct current technology, China can use hydroelectric power to reduce air pollution in its mega cities. Above: supports for thyristors. Pictures of the Future | Spring 2012 93
Five Green Years China’s new five-year plan is designed to help the country transform its
economy into a model of sustainable growth. Siemens will also make a
contribution toward achieving this goal. The number 12 is very important in
China — it stands for completeness, something that brings old things to a conclu-
sion and heralds a new start. It’s therefore significant to the Chinese that their
country is now implementing its 12th five year plan, a blueprint that will move
the nation in the direction of a new economic model, away from environmental
pollution, the squandering of resources, and cheap production to a system of sus-
tainable growth, technological development, and a high level of value creation.
“12-5,” as China refers to its new plan, is no easy thing to read, but since its re-
lease in the spring of 2011 the document has been examined like few other gov-
ernment publications around the world. That’s because the five-year plans are
now effective instruments for defining and implementing specific goals.
The guiding principle of the current plan, which covers the period 2011 to 2015,
involves the recognition that not all growth is good growth. China’s economy
grew by 10.3% in 2010 — an expansion that Beijing economists were not com-
pletely satisfied with, given the fact that a large portion of economic activity oc-
curred in sectors that cause extensive environmental problems, waste resources,
or generate little wealth. They would prefer to see a growth rate of 7%, provided it
is the right type of growth. Still, expansion slowed to 9.2% in 2011. The country’s
macro-planning sets ambitious targets for renewable energy, energy efficiency,
and environmental protection. For example, plans call for an 11.4% share of non-
fossil energy carriers in China’s overall energy consumption mix by 2015 (2010:
The Huaneng combined-cycle power plant (left) and the Waigaoqiao No. 3 coal-fired plant are setting new global standards for efficiency. vantage of a combined-cycle power plant is its
enormous flexibility,” says the plant’s general
manager Xie Deyu. “The plant comprises three
blocks, each with a rating of 400 MW. We can
ramp up and ramp down any of these blocks
fast enough to cover peaks in demand almost
immediately. Last year alone, we had to deal
with over 310 such incidents. If we didn’t have
the combined-cycle power plant, we’d proba-
bly need to operate more coal-fired plants for
backup — and that would result in much high-
er emissions.” Another flexible option for buffering fluctu-
ations in supply and demand would be to ex-
ploit the batteries of electric cars as an inter-
mediate storage facility, particularly when
cities such as Shanghai start to make greater
use of variable sources of power such as wind
energy. At times of either peak demand or low
wind, this backup supply could then be reintro-
8.3%). To this end, 200 new hydroelectric power plants with a combined output
of 120 gigawatts are to be built in China’s mountainous, subtropical southwest.
More wind energy will be used in coastal areas; plans call for the construction of
eight new wind farms in China. Five regions will be transformed into energy sup-
ply bases that distribute electricity throughout the entire country. The govern-
ment will also help fund the installation of smart grids for local power networks.
The cities will see massive investments in local public transport systems. At the
same time, 9,000 kilometers of new highways are to be built, which will give Chi-
na a total of 83,000 kilometers, or 8,000 kilometers more than the U.S. The equiv-
alent of €331 billion is to be invested in railway infrastructure. By 2015 China will
have 45,000 kilometers of track for trains travelling at speeds of 160 km/h or
more.
Plans also call for seven economic sectors of the future — information technology,
environmental technology, renewable energy, biotechnology, high-tech process-
ing, materials science, and drive system technology — to account for at least 8%
of China’s gross domestic product by 2015. Nationwide expenditure on R&D,
which was 1.75% of GDP in 2010, is expected to account for at least 2.2% of GDP
by 2015. At 4% of GDP, China’s education outlay is now almost the same as the
expenditure in Western industrialized nations (Germany spends 4.7%). However,
it’s not just the country’s elites who are to be supported; China also plans to assist
the poorer segments of the population by raising the minimum wage by 13%
each year. This will narrow the gap between rich and poor in China. Plans also call
for continuing to channel more investment into western China in order to attract
more people to that region and reduce the strain of high population densities in
the metropolitan areas of the east coast.
The strategy behind all of these goals isn’t new; Chinese officials were aware as
early as the 1990s that the country was on a dangerous path, because never be-
fore in history had a developing nation set out to modernize its economy without
causing significant environmental damage or generating social tensions. The Chi-
nese nonetheless attempted to combine industrial modernization with sustain-
ability — if not throughout the entire country then at least with lighthouse proj-
ects that would demonstrate that such an approach was possible. The key to ac-
complishing this is advanced technology — so China is clearly focusing on state-
of-the-art technology, a move that among other things has led to Siemens becom-
ing one of the most successful companies in the Chinese market. Siemens cur-
rently employs some 29,000 people at its Chinese locations, and the company
generated €6.4 billion in sales in China in 2011. Siemens technology can be found
in numerous Chinese showcase projects — everything from the Beijing subway to
the world’s most efficient coal-fired power plants, the longest power transmission
systems, and the spectacular facade illuminated in red that China used for its
pavilion at Expo 2010 in Shanghai. “If you look at the Siemens portfolio, it quickly
becomes clear that the company is in a great position to help China achieve its
ambitious goals,” says Martin Klarer, Director of Corporate Development Strategies
at Siemens China. The company offers state-of-the-art solutions for renewable en-
ergy and energy efficiency, automation, building systems, and healthcare — all of
which can greatly help China achieve its 12-5 targets. Bernhard Bartsch
China’s 12-5 plan is designed to boost the country’s sustainability.Siemens is China’s partner in sustainable development.
Pictures of the Future | Spring 2012 95
portant due to inevitable electricity price increases. Such
measures will include the use of more efficient electric
motors and the optimization of machine and production
process control systems, among other things.
Buildings are another major area that offers great
potential for enhancing energy efficiency. If all of the
world’s office buildings, hospitals, schools, and universi-
ties were renovated in ways that resulted in energy sav-
ings of about 30 percent, total CO
2
emissions would de-
crease by about 500 million tons a year, according to
Siemens estimates. This figure is equivalent to the total
CO
2
emissions generated by the UK today. For example,
savings ranging from 10 to 30 percent can be achieved
through improved heating, air conditioning, and light-
ing systems, whereby the costs of the required meas-
ures could be recouped within six months to three
years. A study commissioned by Siemens to examine
ways of increasing energy efficiency in London found
that building system optimization could reduce CO
2
emissions by around 1.9 kilograms per euro spent —
which is five times the savings that can be achieved with
external insulation measures.
Lighting accounts for around 19 percent of global
electricity use. More efficient lighting technologies
could reduce consumption by around one third while
maintaining the same output. Lighting systems account
for 1.3 billion tons of annual worldwide CO
2
emissions,
which means that the decline in electricity consumption
resulting from implementation of more efficient sys-
tems would reduce emissions by 450 million tons. According to a 2011 study conducted by market
consulting firm Pike Research, the global market volume
for energy-efficient building technologies will probably
increase from $68 billion in 2011 to $103.5 billion in
2017. Such technologies include energy-efficient heat-
ing, ventilation, and air conditioning systems, new light-
ing concepts, and energy-saving performance contracts
that allow customers to pay for efficiency measures in
installments that are financed with the guaranteed en-
ergy and operating cost savings achieved. Government regulations will help to promote such
efficiency enhancement measures in buildings. The Eu-
ropean Commission, for example, recently adopted a
new directive concerning energy efficiency in buildings
that requires all new structures to be certified as “nearly
zero energy buildings” by the end of 2020; their remain-
ing low energy requirement is to be covered mostly by
renewable sources.
An analysis conducted by McKinsey in 2011 found
that many efficient building technologies such as heat
pumps, double and triple-glazed windows, and energy-
efficient lighting systems are already available. Addi-
tional potential can be tapped through systems
equipped with sensors that automatically register when
and where heat or air conditioning is needed at any giv-
en moment. Several other new technologies, such as ac-
tive windows that block incoming light when tempera-
tures rise and could pay for themselves in less than three
years, are still being developed and might be commer-
cially available by the end of the decade. The good news is that China,
Russia, and the U.S. have made sig-
nificant initial progress in improving
their energy efficiency. China, for
example, succeeded in lowering its
CO
2
emissions from 1.2 kilograms
to 0.5 kilograms per unit of gross
domestic product between 1990
and 2009. Among other things, this
was accomplished by increasing the
average efficiency rating of coal-
fired power plants by several per-
centage points and improving in-
dustrial production processes. For
example, energy consumption per
ton of steel produced in China de-
clined by 5 percent between 2005
and 2009, and energy consumption
in the cement industry fell by 17
percent per ton of cement manu-
factured. Sylvia Trage
1970–1990 1990–2010 2010–2030
Less and Less Energy Is
Now Being Consumed per
Unit of GDP Increase As Combined Cycle Power Plants Are
Added, the Average Efficiency of Electricity Generation Increases Global growth rates in %
Gross domestic product
(GDP)
Population
Energy consumption
Per capita energy consumption
Energy consumption
per unit of GDP
0
-1
-2
1
2
3
4
20
25
30
35
40
45
Source: BP Energy Outlook 2030 (2011)
Source: Enerdata (2009)
Average efficiency of fossil fuel-fired power plants in %
Penetration of combined cycle power plants (in % of thermal power capacity)
10 12 14 16 18 20 22 24 26 28
Africa
Worldwide
India
OECD Asia
Latin America
North America
Europe
Middle East
Potential Efficiency Gains in Electricity-Intensive Industries
Investment costs largely consist of the additional costs generated
by the procurement of more efficient machines, as well as measures to increase process efficiency in these industries.
Electricity requirement
of industry segments in Germany in 2010
(in petajoules — PJ)
136
76
63
25
Electricity costs for
major industry seg-
ments in Germany in
2010 (in € billions)
2.6
1.5
1.2
0.5
Total energy costs as a share of gross production value (in percent)
3.0
5.7
5.5
Basic chemicals
Paper and cardboard
Metal production
Soil and stone
Total:
~€23 billion
Total:
~€102 billion
Investment costs for energy efficiency
measures (in € billions)
~10
~7
~5
~1
Cumulative savings between now and
2050 (in € billions)
~42
~34
~20
~6
6.0
Source: Roland Berger Strategy Consultants: Efficiency enhancement in electricity-intensive industries (2011)
94 Pictures of the Future | Spring 2012
A
n average of more than 50 percent of the inherent
energy in primary fuels such as coal, oil, and gas
continues to be lost as heat in the processes that con-
vert these fuels into useful forms of energy. In other
words, there is still huge potential for increasing effi-
ciency, especially in the areas of electricity generation,
industrial production, and building systems. According
to a 2011 study conducted by BCC Research, the global
market volume for energy-efficient technologies will in-
crease from $200 billion in 2010 to approximately $312
billion by 2015. Germany’s Federal Environment Agency reports that
state-of-the-art coal-fired power plants currently have
efficiency ratings as high as 46 percent. However, aver-
age coal power plant efficiency in all of Europe is only
36 percent, and the global figure is 33 percent. Improv-
ing efficiency by just one percentage point would lower
CO
2
emissions by up to 3 percent. To put it another way,
the construction of just one 500-megawatt (MW) plant
with an efficiency rating of 45 percent instead of 36 per-
cent would reduce annual CO
2
emissions by 380,000
tons. The World Coal Association reports that if coal-
fired plants over 25 years old with a capacity of less than
300 MW were replaced by bigger and more modern fa-
cilities operating at over 40 percent efficiency, the CO
2
emissions generated by power plants in that range
would decline by nearly 25 percent. Experts also believe
that the use of technological innovations could raise the
efficiency of such plants to more than 50 percent by
2020 (see Pictures of the Future, Spring 2008, p.32). The potential increase in efficiency is even greater
for combined cycle (gas and steam turbine) power
plants. The current average efficiency rating of com-
bined cycle power plants around
the world is roughly 40 percent. But
thanks to Siemens technology, the
most efficient such plant at the mo-
ment was able to convert 60.75
percent of the inherent energy in
natural gas into electricity in May
2011 — a new world record. This
type of state-of-the-art combined
cycle facility can therefore lower
both gas consumption and CO
2
emissions by one third. Experts also
claim that the use of improved tech-
nologies in the form of new materi-
als, for example, could make it pos-
sible to raise efficiency levels to
more than 63 percent by 2020.
Energy efficiency is becoming
more and more important in indus-
trial operations as well. According
to the International Energy Agency
(IEA), the five most energy-intensive industrial sectors
(iron and steel, cement, chemicals and petrochemicals,
paper and cellulose, and aluminum) now account for 77
percent of direct industrial CO
2
emissions, which trans-
lates into nearly 8.5 billion tons per year. Here as well,
efficiency improvements can accomplish a lot. A study
called “Blue Scenario” developed by the IEA calls for a 24
percent decline in industrial CO
2
emissions from 2007
levels by 2050. Analyses conducted by the IEA and the
OECD in 2011 produced various reduction targets to be
achieved by the energy-intensive industries mentioned
above within the framework of the Blue Scenario. For
example, market experts calculate that the global iron
and steel industry could lower its CO
2
emissions by more
than 1.5 billion tons between now and 2050 through
the optimization of the smelting process, among other
things. The analyses produced corresponding reduction
figures of roughly 1.3 billion tons for the chemical and
petrochemical industry, 0.85 billion tons for the cement
industry, and 0.26 billion tons for the paper and cellu-
lose industry. The main savings in the chemical and
petrochemical industry (around 0.74 billion tons) would
be achieved through energy-efficiency improvements. According to a 2011 study conducted by Roland
Berger Strategy Consultants, higher electricity prices are
one of the key challenges electricity-intensive industries
in Germany will face as a result of the country’s aban-
donment of nuclear power. They will also face rising fuel
prices as the country transitions to increased use of en-
ergy from renewable sources. The transition will also ne-
cessitate the upgrading and expansion of power grids
and energy storage systems. In other words, energy en-
hancement measures are becoming more and more im-
Formulas for Efficiency | Facts and Forecasts
Growing Market for Energy Efficiency Technologies
Projected Growth in Key Energy Efficiency Industries
Source: BCC Research (2011) Co-generation plants (electricity and district heating)
Heat-insulated windows
Heat-insulated buildings
Hybrid/electric vehicles
Energy produced from waste
Lighting
Geothermal heat pumps
Biomass power plants
Smart electric meters
0
20
40
60
80
100
2010
2015
Global market volume in $ billions
duced to stabilize the grid. Obviously, such a
system would require a much larger fleet of
electric vehicles than is currently available.
However, the authorities are now planning to
put as many as one million hybrid and electric
vehicles on Chinese roads by 2015. To help
achieve this ambitious target, work has already
begun to provide the requisite infrastructure.
At the end of 2011, for example, Siemens in-
stalled 140 charging stations for electric cars in
Shanghai.
Sustainable City. “China has covered a lot of
ground in terms of improved efficiency,” says
strategy expert Klarer, “but it still faces big
challenges, particularly in metropolitan areas,
where the population is set to grow by an addi-
tional 350 million over the next 15 to 20
years.” Forecasts indicate that by 2025 there
will be around 220 cities with more than one
million inhabitants. Many of these urban areas
will mushroom out of nothing. “To ensure the
greatest possible sustainability, these cities will
require integrated holistic concepts rather than
the discrete isolated solutions implemented in
the past,” Klarer adds. One such concept is cur-
rently being realized just outside Tianjin, a port
near Beijing. Tianjin Eco-City will provide
homes and work for around 350,000 people
from 2020 onward. It should also provide Chi-
na’s urban planners with an answer to the
most pressing question of their time: how to
build a sustainable city on the basis of a repro-
ducible model under realistic conditions.
Such a project looks viable. Around 20 per-
cent of the Tianjin’s electricity is to come from
renewable sources; water consumption will be
half of today’s level; and 90 percent of traffic
will be based on green forms of mobility such
as bicycles, public transport, and electric cars.
Naturally, the buildings will have intelligent
management systems and good insulation. At the same time, the new eco-city will
serve as a living research experiment. It will be
possible to make continual adjustments de-
signed to improve the overall efficiency of the
project. In order to advance the cause of green
urbanization, the project company Sino-Singa-
pore — a joint venture between the govern-
ments of China and Singapore — intends to es-
tablish a joint venture with Siemens. The aim is
to harness a wide range of state-of-the-art
technologies, develop and demonstrate fu-
ture-oriented technologies, and create a vision
that will make Tianjin Eco-city a sustainable
and replicable city model for the rest of China.
Last and by no means least, a project like Tian-
jin Eco-City underscores China’s continuing
commitment to enhanced efficiency — and
that’s an achievement that is much too pre-
cious to be left to the vagaries of the Chinese
zodiac.Sebastian Webel
Pictures of the Future | Spring 2012 97
Almost 200 gigawatts of wind power are installed worldwide — enough to power 35 million average households in the U.S. In Germany, one out of every ten kilowatt-hours is generated with wind. But the price of this power is often higher than that of electricity generated by coal-fired
plants. Engineers at Siemens are developing technologies that could radically change the picture. New Zealand’s West Wind Farm produces electricity for the same price as coal-fired generation,
mainly thanks to strong winds. However, engineers
like Per Egedal (right) are working on innovations to
make this possible worldwide.
Lower Prices in the Air
96 Pictures of the Future | Spring 2012
from Siemens whose development required a
huge amount of skill and engineering expert-
ise. It all starts with the fiberglass rotor blades,
which were built as a single unit without any
welding whatsoever. This makes them very ro-
bust, as there are no weak points where the
blades can break. Sensors installed in the hub
and nacelle also permanently monitor operat-
ing parameters and sound an alarm if suspi-
cious deviations are detected. Like all Siemens
facilities, the wind turbines at West Wind Farm
are designed to operate for 20 years and there-
fore have to be able to withstand hundreds of
millions of rotations. Wind power is one of the most promising
renewable energy sources today. Wind tur-
bines already supply ten percent of the elec-
tricity generated in Germany; in Denmark, the
“birthplace” of wind power, they account for al-
most 25 percent of the electricity produced,
and China — now the world’s biggest market
for wind power facilities — is a major cus-
tomer. Worldwide installed wind power output
is currently just under 200 gigawatts, and this
figure is doubling every three years. The Euro-
pean Commission estimates that by 2030 up
to 135 gigawatts could be installed in Euro-
pean coastal waters alone. That’s almost as
much as the installed output of all the power
plants in Germany, which totals 170 gigawatts.
The Commission believes the share of power
output in Europe accounted for by wind facili-
T
here’s something special about the 62
wind turbines whose rotors turn tirelessly
at West Wind Farm, located 15 kilometers west
of New Zealand’s capital, Wellington. For one
thing, they’ve traveled around the world to get
here from Brande, Denmark — a distance of
roughly 20,000 kilometers. Each of the 62 tur-
bines has an output of 2.3 megawatts, which
adds up to a total of 140 megawatts, enough
to supply electricity to 70,000 homes. What’s
more, West Wind Farm produces its electricity
for the same price as a coal-fired power plant.
One reason for the competitive price of this
energy is the powerful, even wind that blows
through the Wellington region; another is the
fact that the wind turbines are high-tech units
Formulas for Efficiency | Wind Power
should not always turn at full speed, as this
causes its components to wear out more quick-
ly than they’re supposed to. That’s why
Siemens wind power units have sensors
mounted on their hubs that monitor blade
loads. Egedal’s software uses these measure-
ments to determine the stress load the unit is
exposed to at any given time and compare that
value with an ideal stress profile. Depending
on the degree of deviation, the software might
temporarily cut back the unit’s output. “It’s
more important for opera-
tors that a wind turbine sup-
plies electricity for as long as
possible rather than always
generating as much electric-
ity as possible — even when
conditions are tough,” says
Egedal. Optimal calibration of the rotor blades also
lowers stress on the tower, which means the
tower’s steel walls can be made thinner — and
“that will quickly reduce the amount of materi-
al you need by several percent and thus cut
costs,” says Egedal. These savings can be con-
siderable, given that some wind turbines are
now as much as a hundred meters in height. Egedal has also developed a monitoring
program that identifies rotor blade damage at
updates, which can be sent through the Inter-
net to any of 4,000 monitored turbines. “Many small steps need to be taken to make
wind power competitive,” says Stiesdal. “Our
innovations cover the whole value chain, from
manufacturing to maintenance.” In the future,
for example, individual filaments instead of
fiberglass mats will be used for molding rotor
blades. That makes sense, because it’s very
time-consuming and expensive to weave the
mats, which are produced by various compa-
nies in Europe, the U.S., and China. Siemens
has already built a 45-meter-long prototype us-
ing the filament technique. Plans call for the
technology to be gradually introduced at the
end of 2012, with large-scale production
scheduled to begin in 2014. “This and other
process optimization measures that are in the
pipeline will cut the cost of rotor blade produc-
tion in half,” says Stiesdal.
Less Is More. Gearless wind turbines are an-
other innovation created in Brande. Conven-
tional wind power units have a gearbox and a
generator that turns quickly — but both can be
replaced with a slowly rotating, high-torque
synchronous generator. The resulting gearless
turbines have only half as many parts as nor-
mal turbines. This simplifies maintenance and
substantially reduces the unit’s weight. This
approach saves Siemens and its customers
money on replacements, because the ma-
chines are more reliable. For example, the
gearless 6-MW turbine introduced in 2010 is
more than ten tons lighter than a conventional
2.3 MW unit. This weight reduction is particu-
larly important for offshore wind facilities be-
cause their installation costs are very high and
they are difficult to access for repairs.
A Type B52 rotor blade lies outside on the
extensive grounds between the production
halls and the engineering offices in Brande.
The blade is a pristine white and 52 meters
long, with an elegant shape that resembles a
thin whale. “Our rotor blades are the world’s
biggest fiberglass structures built as single
components,” Egedal says proudly. Their pro-
duction process is something like baking a cake
in a sandbox. First, fiberglass is placed into two
molds, both of which are folded together,
evacuated, filled with resin, and heated. The
fiberglass is baked into a rotor blade within 24
hours (see Pictures of the Future,Fall 2007, p.
60). Experts then glue small plastic teeth that
ties could increase tenfold, from five to 50 per-
cent, by 2050. The European Wind Energy As-
sociation (EWEA) estimates that annual invest-
ment in wind power in the EU will double to
€26 billion by 2020. That doesn’t mean we’ll
be seeing wind farms everywhere, however, as
a large portion of this investment will flow into
re-powering — i.e. replacing older units with
new and more powerful turbines.
High Tech in the Countryside. Denmark is
home to one of the global centers for wind
power. Brande is a small town that at first
glance looks like a quiet, idyllic hamlet in the
midst of a hilly landscape nestled between the
North and Baltic Seas. At the edge of town,
however, is a Siemens facility that has several
thousand employees, including around 500
engineers who develop new solutions for mak-
ing wind turbines more efficient and thus
cheaper. One of these engineers is Per Egedal,
36, who was named Inventor of the Year 2011
by Siemens. Thanks to Egedal’s work, Siemens
Wind Power turbines are now among the
world’s most efficient — and efficiency is the
key to competitiveness. After all, if a turbine’s
energy yield rises by one percent, for example,
the price for a kilowatt-hour of electricity falls
by one percent. A lot still needs to be done,
however, because a kilowatt-hour of wind
power currently costs five to seven euro cents
on land and 15 cents offshore, due to the
higher installation and maintenance costs. “We
need to get down to four to five cents per kilo-
watt-hour if we’re to compete with coal on a
global scale,” says Henrik Stiesdal, Chief Tech-
nology Officer at Siemens Wind Power. Sties-
dal has no doubts that this is possible — for
one thing, because of the inventions made by
his colleague Per Egedal.
One of Egedal’s creations is a software pro-
gram for regulating wind force on a turbine so
that the unit can operate absolutely undam-
aged throughout its service life of 20 years.
Despite what lay people might think, a rotor
an early stage by using sensors to measure vi-
bration frequencies inside the nacelle. The fre-
quency patterns provide information about the
condition of the blades. The software sounds
an alarm if a change in the frequency pattern is
detected. Technicians can then decide whether
repair work is necessary and, if so, what needs
to be fixed before other components are dam-
aged. Repairs must be carried out as quickly as
possible because the rotors shouldn’t be shut
down for too long. Siemens turbines are monitored by
Siemens’ three worldwide wind power control
centers, which are located in Brande; Bremen,
Germany; and Newcastle, U.K. The control
centers also manage software installations and
Gearless wind turbines are attractive
because they have fewer parts, weigh less, and are more reliable.
Formulas for Efficiency | Grid Forecasts
A new machine learning solution from Siemens is helping Switzerland’s national grid company to accurately predict losses as energy is transferred from country to country. The result: significant cost reductions and enhanced grid stability throughout Europe.
Formula for Grid Stabilization
L
ots of places describe themselves as being
“the heart of Europe.” But when it comes
to energy distribution systems, only one loca-
tion fits the bill: Laufenburg, Switzerland, pop-
ulation 3,207. This picturesque town on the
shores of the Rhine River has not only been a
crossroads for Roman and Napoleonic armies,
but is today the meeting point for a very differ-
ent kind of power: the electric lines that con-
nect France, Germany, Austria, Italy, and of
course Switzerland itself. It is also home to the
atomic clock that synchronizes and sets the
frequency — some would say heartbeat — of
the entire European Union grid, including
Turkey.
Laufenburg is also where Swissgrid,
Switzerland’s national grid company, is head-
quartered. Because of its strategic location, the
company plays a key role in ensuring that the
balance between electricity production and
consumption across many national boundaries
is maintained at all times. But the ability to meet this goal, and thus
maintain a steady frequency of 50 Hertz, has a
lot to do with making accurate predictions. On
the production side, this is becoming more dif-
ficult as an increasing amount of power is pro-
duced by renewable sources. And on the con-
sumption side, predictions are also tricky
because anything from a sudden cold snap to a
heat wave can significantly change electricity
demand.
Added to these variables is the problem of
predicting so-called “transfer losses” — the
amount of electricity lost as a result of line re-
sistance as it zips from one country to another.
Italy, for instance, purchases electricity from
northern Europe, which crosses Switzerland.
Such losses, which are the result of a number
of variables, such as local weather conditions
and the amount of electricity being transferred
at a given moment, “average about 1.6 per-
cent of the total load of the Swiss energy grid,
which adds up to about 100 megawatt-hours
per hour (MWh),” says Dr. Jan Mrosik, CEO of
the Smart Grid Division of Siemens’ Infrastruc-
ture & Cities Segment. “At an average spot
price of €55 per MWh, the monetary equiva-
lent of these losses is €5,500 per hour, or
€48.18 million per year.”
Money-Saving Algorithm. In order to make
up for transfer losses, Swissgrid must purchase
additional electricity on the Swiss Spot Market,
a process that begins up to 16 hours in ad-
vance every day of the year. Obviously, given
the huge amounts of energy involved, the
highest level of predictive accuracy is needed.
Until recently, the company relied on an algo-
rithm that has a forecast error of approximate-
ly 11 percent. But now, thanks to a neural-net-
work-based algorithm (for more on such
algorithms, see Pictures of the Future,Fall
2011, page 54) developed by Siemens Corpo-
rate Technology (CT), Swissgrid expects to low-
er its forecast error to ten percent — a ten per-
cent improvement, according to Mrosik.
“Thanks to lower usage of control energy and a
reduction in the amount of unused energy re-
sulting from overestimating transfer losses, we
estimate that Swissgrid will save about
€200,000 per year,” he says.
Unlike any other algorithm
in this area, the system de-
veloped by Sie mens Corpo-
rate Technology “derives the
predicted transfer loss from
the load (electricity usage)
forecast — two functions
normally considered to be
separate — in a single, inte-
grated step,” explains Dr.
Ralph Grothmann, who,
along with Dr. Hans-Georg
Zimmermann, developed
the algorithm. “It is an inte-
grated model, and that is not only unique but
significantly more accurate than competing
models.” Thanks to years of experience in re-
fining their understanding of neural networks,
the researchers’ load forecasts are typically 97
percent accurate. This accuracy also derives
from the fact that CT’s algorithm takes histori-
cal data into account as well as variables such
as current weather conditions and the fill lev-
els of pumped water storage systems.
Once fully implemented, the new hybrid algorithm could add increased stability to the
EU’s electricity grid. “The system’s ability to
learn is especially important in terms of adapt-
ing the grid to energy flows induced by renew-
able sources such as wind, solar, and hydro
power,” says Mrosik. What’s more, the algorithm can also be
used to forecast other factors, such as Euro-
pean energy flows and the specific amounts of
energy expected to be produced by wind and
solar installations. “Pilot projects carried out by
Siemens have demonstrated that our neural
networks can predict renewable energy sup-
plies with an accuracy of 90 percent up to 72
hours into the future,” says Mrosik. “That
knowledge could really help grid operators to
balance energy flows.” Arthur F. Pease
Pictures of the Future | Spring 2012 99
has also developed a program that regulates
the load on each rotor in a wind farm in a man-
ner that optimizes overall performance. Wind
farms where rotors are placed only a short dis-
tance apart tend to experience significant loss-
es due to wakes behind the turbine rotors. “In
such a situation, it makes sense to cut back
somewhat on the power output of the first and
second turbines in a row,” Egedal explains (see
Pictures of the Future,Spring 2011, p. 97).
Powerful Future. Bigger, lighter, and more
powerful — there’s still plenty of room to fur-
ther optimize wind turbines. A prototype of the
six-megawatt unit developed by Stiesdal and
his team is now being tested in Denmark.
Large-scale production is scheduled to begin in
2014. The one-megawatt unit next to the com-
pany’s engineering offices in Brande looks tiny
compared to the new super turbine. And six megawatts isn’t the end of the sto-
ry. For some time, Stiesdal and his team have
been striving to achieve the many small im-
provements that will enable construction of a
ten-megawatt unit with 100-meter-long rotor
blades. The higher the output, the more effi-
cient the turbines, and the cheaper the price of
electricity.
There are limits to this megawatt expan-
sion, however. “Ten megawatts will likely be
the maximum for offshore turbines,” says
Stiesdal, “and don’t expect to see turbines with
an output of much more than four megawatts
in wind farms on land.” Still, the optimized su-
per wind turbines are sure to give coal-fired
power plants a run for their money when it
comes to cost-effectiveness, efficiency, main-
tenance-free operation, and longevity — and
not just in New Zealand. Jeanne Rubner
98 Pictures of the Future | Spring 2012
look like dragon scales along the blades. These
ensure that air is pressed onto the rotor blade
more strongly — another small detail that im-
proves efficiency by two to three percent. Production of the 2.3-megawatt genera-
tors, which are especially in demand, is also
being optimized. An LED display hangs sus-
pended in the large hall where the nacelles for
these units are manufactured. The display is
actually a clock that reads 1:44 at the moment
and counts downwards. It tells workers that
the current manufacturing step must be com-
pleted in this time. In other words, everything
here is clocked like in a car factory. Each pro-
duction step takes two hours; after that the
component rolls to the next station. It takes
eight stations to fit the nacelle shell with its in-
terior components, including the gearbox,
generator, hydraulic system, computer, meas-
uring instruments, and doors. The entire
process results in a finished nacelle with a pro-
truding hub for the rotor blades. This new system has cut the time it takes to
complete a single unit from 36 hours in 2010
to just 19 hours today, which saves a lot of
money. Siemens’ success shows it’s on the
right track. Around 800 people were employed
in Brande just under ten years ago; today there
are 3,200. The facility used to manufacture
turbines with a combined output of 450
megawatts each year; now it builds units with
a total output of roughly 4,000 megawatts. All
of this has increased the company’s demand
for space, which is why a new manufacturing
hall for 2.3 MW nacelles is now being built.
“There’s always some kind of production build-
ing going up around here,” says Egedal. Wind Power employees are busy putting
wind turbine components through endurance
and other tests. Rotor blades, for example, are
made to rock back and forth on a special crane
for three months without stopping — that’s
about two million oscillations. This is how
Siemens simulates 20 years or so of operation
to test material durability. Another innovation developed
by Stiesdal’s team was also tested
here: the “Arabian scimitar,” which
is viewed as the rotor blade of the
future. The blade is slightly curved
and twists under the force of the
wind, which reduces load. Known
as “aeroelastic tailored blade” tech-
nology (ATB), this new concept is especially
useful on the high seas, where air masses of
up to 100 tons per second strike the blades, of-
ten from different directions. Elastic blades can
adapt to the wind flexibly. And because blade
material is subject to less wear and tear, its
service life increases. The new blade form and
its improved stability make it possible to pro-
duce longer rotors that generate more energy
without an increase in aerodynamic load. In-
deed, the new blades are 53 meters long, or
four meters longer than their predecessors. “Al-
though the blades are 500 kilograms lighter,”
says Stiesdal, “they have a five percent higher
energy yield.” Siemens has other innovations in the
pipeline as well. Egedal, the software inventor,
Assembly of a gearless turbine for test operation. Siemens has developed a gearless 6-MW turbine designed specifically for the harsh conditions experienced at sea. Shaped like a scimitar, the rotor
blade of the future twists in tune
with the strength of the wind. Accuracy of Forecasting Algorithm -50% -40 -30 -20 -10 0 10 20 30 40 50%
0
20
40
60
Error frequency
Distribution shows that the error with the highest
probability is zero.
Positive or negative errors in forecasts of transfer losses
Quelle: Siemens
Pictures of the Future | Spring 2012 101
When it comes to power generation and distribution, hydrogen is set to become increasingly important. It will not only store the power from excess electricity generated by wind and solar plants but will also serve as a fuel for cars. What’s more, it can be combined with renewably-
produced carbon dioxide to produce a feedstock for plastics production.
Siemens engineers have developed an electrolyzer
based on proton exchange membranes. It reacts within milliseconds to the available electrical current — and is thus ideally equipped to handle power generation fluctuations.
The Most Versatile Fuel
100 Pictures of the Future | Spring 2012
unable to accommodate 150 gigawatt-hours
of electrical energy in 2010 simply because it
was already operating at full load.
This explains why wind turbines often re-
main inactive during a storm and why older,
coal-fired power plants with high carbon diox-
ide emissions are reconnected to the grid on
calm days — circumstances that are becoming
more pronounced as Germany produces a larg-
er share of its power from the wind and sun.
According to the German Federal Government,
the country expects to meet about 50 percent
of its total demand for power with renewable
energies by 2030, and to achieve 80 percent
from such sources by 2050. These targets cannot be met without mas-
sive energy storage systems — systems capa-
ble of capturing excess energy when winds are
intense and feeding it back into the grid later
when demand is high. “To meet the future
challenges of an energy system based on re-
newable energies, we’ll need a variety of stor-
age technologies suitable for everything from
periods of seconds or hours to long-term peri-
ods of days or weeks,” says Katherina Reiche,
Parliamentary State Secretary in the German
Federal Ministry for the Environment. And Germany is certainly not alone. Many
other countries that are now moving toward
increased use of renewable energy sources will
W
hat a waste! In northern Germany, the
wind is blowing — but many rotors in
nearby wind farms are motionless. “Up to 20
percent of the time, wind systems on the
North Sea coast have to be switched off; other-
wise they’d produce more power than needed
at a given moment,” says Erik Wolf, a technol-
ogy strategist for Siemens’ Solar & Hydro Divi-
sion. “This indicates a central challenge associ-
ated with renewable energies — production
fluctuates as weather conditions change. In
other words, supply isn’t based on demand, as
is the case with conventional power plants.” In-
deed, Germany’s wind energy trade associa-
tion estimates that the German power grid was
Formulas for Efficiency | Electrolysis
says Wolf. “The maximum of 60 terawatt-hours
of energy that could be stored in these 400 facilities corresponds to about ten percent of
annual demand in Germany. That would be
enough to compensate for longer periods of
low wind or solar power production.“
Two small hydrogen caverns in the UK and
U.S. have been in operation for years. These fa-
cilities have demonstrated that this form of
storage is safe. Experts expect that a typical hy-
drogen storage facility will cost between €10
and €30 million. Utilities must also invest in
gas-fired plants that typically require an invest-
ment of between €50 million
and €700 million depending
on plant output. Power companies see great
potential in hydrogen technol-
ogy. “We want to sharply re-
duce CO
2
emissions. So we’re
building and developing new, efficient power
plant technologies and operating more and
more wind farms,” says Dr. Sebastian Bohnes
from the research department of Germany’s
RWE Power. “These days, wind turbine speeds
are throttled, mostly because of bottlenecks in
the power grid. Efforts to expand the use of re-
newable energies could lead to a rapid in-
crease in overcapacities. Electrolysis offers an
interesting way to store — in the form of hydro-
in contrast to conventional alkaline electrolysis
technology (see Pictures of the Future,Spring
2011, p. 26). “Our PEM electrolyzer reacts
within milliseconds and can easily handle
three times its nominal power rating for a
while. In other words, even if there’s a sharp
increase in power generation, it can make use
of the excess power without any difficulty,”
says Roland Käppner, head of the Hydrogen
Solutions business unit in Siemens’ Industry
Sector.
Siemens’ PEM technology is now mature
enough to move out of the lab and into practi-
cal applications. Building on results from a re-
search electrolyzer with a nominal power rat-
ing of ten kilowatts, Käppner’s team is now
working on a new electrolyzer that will have a
nominal power rating of 0.1 megawatts and a
peak rating of 0.3 megawatts. It will produce
two to six kilograms of hydrogen per hour and
is scheduled to be operational by the end of
2012. “We’ve optimized the design and all the
peripherals, such as the control system and the
also need to augment their power grids with
storage systems. “We’re involved in detailed
discussions at the moment in a number of
places — for example, in Denmark and the
United States,” adds Wolf.
And when it comes to storing the power
produced by excess electricity, electrolysis is
set to play a key role. Here, water is decom-
posed into oxygen and hydrogen gas by means
of an electrical current. At a pressure of 200
bars, the energy density of the hydrogen gas is
comparable to that of a lithium-ion battery. Large quantities of the gas could thus be
stored in the underground caverns of salt
domes of the sort used by natural gas suppliers
as reservoirs, or in the existing natural gas
grid, which can accommodate up to five per-
cent hydrogen without difficulty. In purely
mathematical terms, the latter could store 130
terawatt-hours of electrical energy in the form
of hydrogen, which represents almost a quar-
ter of German power consumption per year. Underground Storage. On calm or cloudy
days, the hydrogen gas could then be retrieved
from caverns and, for example, burned in a
combined-cycle power plant that drives an elec-
tric generator to produce electricity. At the mo-
ment, of course, there are no turbines that can
burn pure hydrogen — but by 2014, Siemens
hopes to present a prototype (see Pictures of
the Future,Fall 2009, p. 7). Although approxi-
mately half of the energy produced by wind
would be lost during electrolysis and subse-
quent combustion in a gas turbine, windmills
would no longer have to be shut off because of
overcapacity. What's more, the problem of fluctuating
power generation would be solved: “In Ger-
many, depending on the energy mix and pow-
er demand by 2050, we will need a maximum
of 400 cavern reservoirs for hydrogen with a
volume of about 500,000 cubic meters each.
At present, there are already 200 such reser-
voirs for natural gas that could also be used,“
gen gas — electricity that can not be used im-
mediately.” This presupposes that the elec-
trolyzers that produce the energy-rich gas from
electricity have the ability to react quickly to
the fluctuating supply of electrical power. So
far, the systems, which have a reaction time of
a few minutes, have been too slow.
Flexible Hydrogen Factory. For years, re-
searchers from Siemens Corporate Technology
have therefore been refining an alternative
electrolysis technology that is much more flex-
ible. In their electrolyzer, a proton exchange
membrane (PEM) separates the two electrodes
at which oxygen and hydrogen are formed —
A 60-megawatt electrolyzer could convert the surplus energy produced by a large wind farm.
power supply,” says Käppner, describing the ef-
forts that brought the system out of the lab
and into the field. “We’re also working on re-
ducing costs considerably with innovative ma-
terials and structural features.”
Hydrogen production via electrolysis still
costs upwards of €10,000 per kilowatt of in-
stalled load. But thanks to further refinements
in design, Käppner hopes to lower costs to un-
der €1,000 per kilowatt by 2018, at the latest.
By then, the third generation of Siemens elec-
trolyzers is expected to be able to accommo-
date up to 100 megawatts, thus converting ex-
cess wind-generated electricity into hydrogen
in large quantities. A 60 to 90-megawatt elec-
Pictures of the Future | Spring 2012 103
In the future, algae may be used to convert carbon dioxide
from power plants into raw materials for biofuel. To accom-
plish this, Siemens researchers are exploring filtration tech-
nologies ranging from pulsed electric fields to magnetism. In order to harvest CO
2
-guzzling green algae more
efficiently, the organisms are exposed to a high-fre-
quency alternating current. This causes them to
sink. Siemens researcher Dr. Manfred Baldauf
(below, right) is testing this new method. Green Solution
rope can absorb barely ten tons per hectare, and
even rapidly growing Chinese silver grass (Mis-
canthus sinensis) can only absorb about 50 tons
of the greenhouse gas per hectare. And that’s not
the only reason why algae farms would require
relatively little land that could also be used agri-
culturally. After all, such farms could be operated
on infertile soil, and in the future perhaps even in
oceans or rivers.
Siemens (among others) is providing financial
support for the publically-funded open-air algae
development program at the University of
Queensland. The company is also studying algae-
supported carbon dioxide utilization in the con-
text of its own research program, and is explor-
lowing the water above them to be pumped
back into a reactor. “We’re also investigating
whether the pulsed electric fields cause algae
cell walls to rupture,” says Baldauf. That would
be a desirable side-effect since it would facili-
tate the extraction of oils that could be used
for the production of biofuels. In another method of harvesting algae,
Siemens researchers blend micrometer-size
magnetite particles with algae and direct the
resulting algae-rich water over a rotating mag-
netic drum. The magnetite particles adhere to
the algae, and both together adhere to the
magnet. “After that, however, the algae need
to be separated from the particles. We’re trying
R
esearchers at the University of Queensland
in Australia would be very unlikely to com-
mit algaecide. Unlike many pond gardeners,
they are proud of the deep green water in their
open-air basin. That’s because the algae here
are entirely beneficial. They use photosynthe-
sis to remove carbon dioxide (CO
2
) from the air
and produce biomass in the process: oils, fats,
and proteins, which can be converted into bio-
fuel, animal fodder or medications. “If they
were fed CO
2
-rich power-plant exhaust gases
they could absorb up to 120 tons of carbon diox-
ide per hectare annually,“ says Dr. Manfred Bal-
dauf, a chemist at Siemens Corporate Technology
(CT) in Erlangen, Germany. A forest in central Eu-
Formulas for Efficiency | CO
2
Utilization
ing alternative carbon utilization methods,
such as the production of methane and
methanol from carbon dioxide and hydrogen.
Baldauf and his team have set their sights on
an ambitious goal: development of technolo-
gies capable of converting carbon dioxide into
environmentally-friendly products (see Pic-
tures of the Future,Spring 2010, p. 46 and
Spring 2011, p. 26). Baldauf can’t predict what role algae may
play in this quest. What’s certain is that no
breakthrough can be achieved without effi-
cient technologies. “The processes that are
now available would release more CO
2
than
they would absorb,” he explains. In addition to
the operation of the bioreactor, this is due to
the process phases of harvesting and drying,
which consume huge amounts of energy. Magnetic Methods. Solutions may be in
sight. Siemens researchers are working on two
particularly efficient harvesting technologies.
Current methods separate algae from water ei-
ther centrifugally or by filtration. But a more
energy-efficient method is electroporation.
Here, electrodes immersed in algae-rich water
are connected to a high-frequency alternating
voltage that destroys the structures that en-
able the algae to float. As a result, the green
multicellular organisms sink to the bottom, al-
from fossil energy sources, could instead be
produced from carbon dioxide and hydrogen.
with water being generated as a waste prod-
uct. “This reaction takes place using special
catalysts that Bayer is developing with partners
from the scientific community,” says Daniel
Wichmann from Bayer, the lead project manag-
er for CO
2
RRECT. “With a different catalyst, it’s
also possible to make formic acid, which is also
an important basic ingredient for organic
chemistry.”
The crucial factor in all of this is that CO
2
and H
2
must be available in sufficient quanti-
ties — and that is the responsibility of project
partners Siemens and RWE. In the German
state of North Rhine-Westphalia, energy com-
pany RWE operates a lignite-fired power plant
at Niederaußem, which is equipped with a
flue-gas system that scrubs CO
2
out of the
power plant’s emissions. The gas is subse-
quently made available to researchers who are
investigating CO
2
utilization.
As part of this work, one of the electrolysis
containers from Siemens will be set up here in
late 2012 and tested under realistic conditions.
“We’re going to simulate grid-specific load pro-
files and the infeed characteristic of real wind
farms,” says RWE expert Bohnes. “That way we
can figure out whether the electrolyzer will be
able to handle fluctuating power supplies.”
From CO
2
to Plastics. In Leverkusen, Bayer
and its partner Invite are building a test facility
that is slated to open in late 2013. At the test
site, CO
2
and H
2
will react to form CO. If the
process proves to be effective, the CO generat-
ed this way could eventually be used on an in-
dustrial scale — for example, for the profitable
production of isocyanates. These organic com-
pounds can be used as feeder material for
polyurethane, which is found in everything
from automobiles and furniture to insulation.
“With the test plant, we want to demonstrate
that fluctuating hydrogen production can be
combined with the constant processes needed
by the chemicals industry,” says Wichmann.
CO
2
RRECT will run until the end of 2013. So
far, chemical companies and energy producers
have been benefiting from its results. Power
plant operators can make good use of the CO
2
extracted, instead of just storing it under-
ground. They also avoid expenses for emis-
sions certificates. Plastics manufacturers, in
turn, reduce their dependence on petroleum.
And finally, the climate benefits as well.
“Through the CO
2
RRECT process and continued
refinements to this technology, it may be pos-
sible to avoid producing several million metric
tons of CO
2
emissions per year in Germany,”
says Bohnes. “And that would be equivalent to
one to two percent of total German carbon
dioxide emissions.” Christian Buck
102 Pictures of the Future | Spring 2012
trolyzer would suffice to convert the surplus
energy of a large wind farm.
Between the 0.1 megawatt model and the
100 MW system, Käppner plans to develop an
intermediate step. This will be an electrolyzer
with a rated power of two megawatts. It is
scheduled to go into operation around 2015.
In addition to storing energy and stabilizing
the grid, the system will be suitable for use in
future automotive filling stations. This would
obviate transportation of hydrogen to gas sta-
tions since the fuel could be produced right at
the station — using excess electricity from the
power grid and tap water. “Renowned au-
tomakers are ready and waiting to start up
their assembly lines for the production of fuel
cell cars,” says Käppner. “And when they do,
their cars will run on renewably-produced hy-
drogen!”
This highlights one of hydrogen’s major ad-
vantage: its versatility. It can be re-converted
into electricity, it can power cars, or it can be
“methanized” — a process in which hydrogen
reacts with carbon dioxide to form methane,
the primary constituent of natural gas. Hydro-
gen’s energy could thus be stored in the exist-
ing gas distribution infrastructure. But it could
also be used for heating or driving gas-pow-
ered vehicles. “Methanization is a good idea in
principle,” says Siemens expert Wolf. “But the
process is only carbon neutral if both the H
2
and the CO
2
come from a renewable source,
such as a biomass plant. And don’t forget that
the conversion of hydrogen into methane also
requires energy — so in terms of energy, it al-
ways makes more sense to use hydrogen di-
rectly.”
Gaseous Dream Team. Hydrogen is not only
a perfect energy carrier but also an important
raw material for the chemicals industry — one
currently obtained almost exclusively from nat-
ural gas. On the one hand, the goal must
therefore be to produce hydrogen
via renewable electricity at approxi-
mately the same cost as its produc-
tion from natural gas. On the other
hand, hydrogen (H
2
) could one day
form a real dream team with the
greenhouse gas carbon dioxide.
How CO
2
can be used for chemicals
production in combination with renewable en-
ergies is the subject of a research project in
which Siemens, RWE, Bayer Technology Servic-
es, Bayer MaterialScience, and ten other part-
ners have been collaborating since 2010.
Known as CO
2
RRECT (CO
2
Reaction using Re-
generative Energies and Catalytic Technolo-
gies), the project has a value of €18 million
and is being funded with €11 million from the
German Federal Ministry of Education and Re-
search.
The basic idea behind the CO
2
RRECT project
is that carbon monoxide (CO), which is an im-
portant intermediate product of the chemicals
industry that has traditionally been obtained
By 2018 Siemens expects to have an electrolyzer that can handle up to 100 megawatts.
In the future, hydrogen for fuel cell cars could be produced
right at the filling station.
Pictures of the Future | Spring 2012 105
Around half of the primary energy consumed in industrial processes is currently wasted. For waste heat in particular, there are virtually no economically practical and technically mature energy recovery methods. Siemens is working on ways to intelligently utilize much of this energy.
Hot Opportunities
and are environmentally harmless,” explains
Fleischanderl. Consequently the system func-
tions without expensive high-pressure vessels,
is easier to build and to get approved, and is
safe to operate. What’s more, due to the salt’s
high temperature of up to 500 degrees Celsius,
the process enjoys an efficiency rating of 24
percent — substantially higher than that of a
steam accumulator, which is only 17 percent.
Fleischanderl estimates a worldwide market
of around 300 such systems, each of which
could cost about €30 million. “Up to 20 per-
cent of the electric power needed for melting
scrap metal could be recovered from the waste
heat,” he figures. “That would reduce CO
2
emissions per metric ton of steel by about 40
kilograms (kg). Current systems emit about
270 kg of CO
2
, 220 kg of which results from
power generation. This means that CO
2
emis-
sions from a typical 120-metric-ton furnace
could be reduced by more than 30,000 metric
tons annually.” wide range of processes and identified 20 cas-
es that could offer substantial heat recovery
potential. Drawn from about 80 use cases, the
most promising projects include four in which
Organic Rankine Cycle technology (ORC) can
be applied. ORC is particularly well suited for
using waste heat from furnaces in the glass in-
dustry, from diesel or gasoline engines, from
gas flaring at refineries, and from gas turbines
in compressor stations. In contrast to the clas-
sic steam-circuit process, what circulates in an
ORC is not water but an organic medium that
ensures optimal efficiency at low waste-heat
temperatures and low power, and is well suit-
ed for a compact design.
A Volatile Medium. In an ORC research project
with the Moscow Power Engineering Institute
and Moscow State University, Siemens is using a
new working medium from U.S. company 3M,
which is composed of carbon, fluorine, and oxy-
gen and vaporizes at just 49 degrees Celsius un-
Formulas for Efficiency | Waste Heat Utilization
Experts from Siemens are currently testing
different vessel materials and salt mixtures,
and a pilot system has been in operation since
February 2012 in a steel plant in Germany. The
first commercial heat recovery system may be
available in 2013. But at present, most industrial waste heat
still serves no useful purpose. “Today about
half of the primary energy consumed in indus-
trial processes and in energy generation goes
to waste,” says Dr. Martin Tackenberg of
Siemens Corporate Technology (CT) in Erlan-
gen. “Especially when it comes to waste heat
at temperatures below 300 degrees Celsius,
there are hardly any economically practical and
technically mature processes.” With this in
mind, Siemens, in a special project that focus-
es on thermal management, has examined a
45 and 60 minutes, depending on the system.
During that period, the flue gas temperature
and the flow rate vary widely, which poses a
difficult challenge for engineers. “To operate
effectively, a turbine must be fed hot vapor
continuously,” Fleischanderl points out. “To
make that happen, we have introduced a heat
storage system between the furnace and the
turbine.” This function is provided by a salt mixture
with a low melting point that is also used in so-
lar thermal power plants (see Pictures of the
Future,Fall 2009, p. 19). The salt mixture ex-
tracts energy from the exhaust gas through a
system of heat exchangers. In a second circuit,
water flows through the heated salt mixture,
generating steam that powers a turbine that
generates electric power. The latter is a contin-
uous process that is independent of the fur-
nace cycle. “Salt melts have the advantage that they re-
quire no pressure, have high storage capacity,
Siemens researchers have developed a technology
for using the heat generated in industrial processes
to clean wastewater. A temperature of 65 degrees
Celsius is sufficient for the process.
S
teel is everywhere. Without this material
entire industries, such as mechanical engi-
neering and auto manufacturing, would be in-
conceivable. In 2011, worldwide production of
crude steel amounted to about 1.5 billion met-
ric tons — a figure that required a vast amount
of energy to achieve. Even steel produced by
recycling scrap metal in electric-arc furnaces,
for instance, requires approximately 370 kilo-
watt hours (kWh) per metric ton. In this type of
furnace an electric arc is struck between sever-
al electrodes. The resulting heat causes the
steel to melt. And then? The furnace’s tap hole
emits a mixture of gases at up to 1,700 de-
grees Celsius — a huge waste that might oth-
erwise be used to generate electric power.
Capturing that waste heat is exactly what a
team headed by Dr. Alexander Fleischanderl of
Siemens VAI Metals Technologies in Linz, Aus-
tria is working on. But there’s nothing easy
about it. From furnace loading, through the
melting process, to “tapping” takes between
104 Pictures of the Future | Spring 2012
used as activated carbon in wastewater purifi-
cation, for instance, or simply disposed of.
“The big advantage of this process is that CO
2
is taken out of circulation for a very long time,”
Baldauf says.
Algae-based carbon dioxide recycling is also
an objective among CT researchers who are
not associated with the CO
2
recovery project.
Professor Maximilian Fleischer, for instance,
works with genetically altered algae cells, and
is supported in his work by Cord Stähler, a ge-
netic technology expert who is CTO of the
Siemens Healthcare sector. Here, the objective
is to use super cells to produce ethanol. For in-
stance, in the blue algae known as cyanobac-
teria, photosynthesis is used to convert CO
2
mainly into sugar. An additional gene could
ensure that the sugar is converted into ethanol
within algae cells. ”What we intend to achieve
by this is an overall efficiency of between 15
and 20 percent,” Stähler notes. Photosynthetic Facades? And if lowly algae
cells can use photosynthesis, how about the
high-tech houses of the future? Here, airborne
carbon dioxide reacts chemically with water,
sunlight and a suitable catalyst to form
methanol and oxygen. “Methanol can then be
used in a fuel cell to generate electric power
and heat, for instance,” says CT’s Fleischer. In
the future, water-filled reactor panels that are
glass-shielded against the sun and equipped
with a membrane on the backside that’s per-
meable to CO
2
could cover entire building fa-
cades and endow houses with photosynthetic
behavior akin to that of trees. But long before substantial quantities of
CO
2
can be reined in by photosynthetic fa-
cades, another technology will probably have
achieved a breakthrough. “Methanol or
methane production from CO
2
and hydrogen
that is powered by using wind or photovoltaic
energy, for instance, is already technically fea-
sible,“ says Baldauf. In fact, by 2013, Stuttgart-
based startup Solarfuel plans to launch the
first such system at an Audi facility. Siemens is currently developing an espe-
cially efficient and dynamic electrolyzer for hy-
drogen production (see p. 100). In this connec-
tion, chemical company and project partner
Bayer is exploring the use of hydrogen and CO
2
to produce polyurethane, an important raw
material for foam plastics and paints. It is not yet clear if scientists will be able to
transform carbon dioxide into a profitable raw
material for mass production. But the signs are
all pointing in the right direction. There are al-
ready potential buyers for algae products gen-
erated with carbon dioxide. According to Bal-
dauf, companies that have expressed an
interest include EADS, Neste Oil, airlines, and
livestock breeders. Andrea Hoferichter
to determine the best way of doing that,” says
Baldauf. Then too, not every type of algae is
suitable for every method of harvesting. To
identify suitable species, Siemens researchers
are working with scientists at Bielefeld Univer-
sity in Germany. Siemens is also working with the Karlsruhe
Institute of Technology in Germany, which is
developing different bioreactors to reduce the
cost of algal cultures. Factories or power plants
located near an algae farm could contribute to
the improvement of the environment and
economy by contributing exhaust gases that
contain CO
2
as well as waste heat. This would
support the drying process and help to main-
tain a favorable climate during cold months.
Algae do best at temperatures between 20 and
30 degrees Celsius.
What sorts of end products might be devel-
oped based on CO
2
utilization? Siemens re-
searchers lean toward biofuels and animal
feeds. In fact, both of these products could be
produced at the same time — biofuels from al-
gal oils, and feed from the residue. Indeed, it is
already economical to produce foodstuffs,
pharmaceuticals and cosmetics from algae
constituents, because these products can be
sold at much higher prices than biodiesel at
the filling station. ”But the quantities produced
are much too small to absorb significant
amounts of CO
2
,” says Baldauf. As part of Siemens’ carbon dioxide recovery
project, researchers are also investigating
whether and how ”hydrothermal carboniza-
tion” of biomass can be achieved efficiently. In
this process, the algae harvest is heated to
nearly 200 degrees Celsius. One resulting
product is elemental carbon, which can be
Harvesting algae blended with magnetite.
Pictures of the Future | Spring 2012 107
Materials researchers at Siemens are continuously looking for new substances to help products use
less energy. At the same time, they are developing methods that will allow raw materials to be used
and recycled as sustainably as possible. It is also crucial that new materials be quickly patented. Siemens researcher Raquel de la Peña Alonso develops new materials. To do this, she lets a robot make numerous samples of different combinations of materials, which are then automatically analyzed. The Elements of Competitiveness
samples to measure their specific properties,
such as their melting point or electrical con-
ductivity. Because 120 samples are examined
at the same time, the process is around 20
times faster than it would be if each substance
were made by hand. That saves time, money,
human resources, and material. Powerful Illumination. The HTE Lab is devel-
oping new phosphors such as those found in
white light-emitting diodes (LED), in which a
blue light-emitting chip excites the covering
phosphor in such a way that white light is pro-
duced. A phosphor’s strength and color de-
pends on its composition and crystal structure.
Together with Siemens subsidiary Osram, de la
M
aterials researchers at Siemens are on a
high-speed treasure hunt. They know
that just a handful of elements will suffice to
open up a wide field of possible combinations.
But they also know that speed is of the
essence. Nuggets are rare and competitors are
quick to capitalize on them. “Whoever is quick-
est gets the patent,” says Dr. Raquel de la Peña
Alonso, who works at Siemens Corporate Tech-
nology (CT) in Munich, where she manages
the High Throughput Experimentation (HTE)
Lab (see Pictures of the Future,Spring 2003, p.
26). At the lab, robots that dose materials very
precisely produce large numbers of samples.
Special programs subsequently analyze the
Formulas for Efficiency | New Materials Peña Alonso is looking for phosphors that are
more efficient or that produce colors other
than those available today. Among other
things, she and her team have discovered a
phosphor whose light is redder than that of
other materials. White LEDs need red light
components in order to emit warm light.
Thanks to de la Peña Alonso’s work, Osram
now owns a few additional patents in the hotly
contested LED market, and light-emitting
diodes need less phosphor as a result. Phosphors also contain rare earth elements
such as europium. These materials may be-
come scarce in the future as LEDs are increas-
ingly used for general lighting. In view of this,
CT has launched a research program that de-
velops strategies for the sustainable use of
these materials. Among the key issues being
addressed here are permanent magnets con-
taining the rare earth elements neodymium
and dysprosium. These elements are used, for
example, in wind turbines and electric motors
— areas in which rapid growth could lead to
supply bottlenecks (see Pictures of the Future,
Fall 2011, p. 100). In view of this, CT’s Sustain-
able Materials research program, which is led
by Dr. Thomas Scheiter, is examining new recy-
cling techniques, researching magnetic materi-
als that do without rare earth elements, and
developing methods for assessing whether a
106 Pictures of the Future | Spring 2012
der normal pressure. “What’s more, this organic
medium is absolutely non-polluting. That’s very
important to Siemens in the context of sustain-
ability,” notes Tackenberg. The first demonstrator,
which has a power output of 1.2 kilowatts (kW),
has been operating at Moscow State University
since November 2011. A scaled-up model with a
power output of 100 kW is slated to start operat-
ing at German fiberglass manufacturer Lauscha’s
Russian plant in the fall of 2012. It will derive its
energy from hot waste gas produced by a fiber-
glass production line — at a temperature of only
220 degrees Celsius. “This ORC unit will produce
about 800,000 kWh of extra electricity per year
with an efficiency of about 20 percent, which
corresponds to a value of about €80,000,” says
Tackenberg. “The investment cost in this case is
around €2,200 per kilowatt. As a result, the sys-
tem will be amortized in less than three years.”
He estimates the annual market for ORC solutions
amounts to about €3 billion.
Cleaning Water with Waste Heat. Not only
can waste heat be used to produce electricity. It
can also be used to clean water. That’s the idea
behind a Siemens process called EvaCon (Evap-
oration and Condensation). “Industrial process-
es often generate waste heat at a temperature
that’s too low for economical electricity genera-
tion,” explains Dr. Thomas Hammer, project
manager of EvaCon at CT in Erlangen. “EvaCon
can utilize waste heat at between 65 and 90 de-
grees Celsius for water purification.”
In this application, wastewater is heated,
evaporated and fed into a condenser, where the
vapor liquefies again. “This is how pure water is
separated from concentrated wastewater, and
the end result is demineralized water,” says
Hammer. Potential heat sources include, among
others, paper mills and soft drink bottling plants
where wastewater is generated that cannot be
readily disposed of in a sewage treatment plant.
EvaCon generates new freshwater while at the
same time reducing the amount of wastewater
that must be disposed of.
CT researchers are currently investigating the
best design and materials for the vaporizer and
condenser. In September 2012 a prototype is
slated to demonstrate that the process can be
used on an industrial scale. Tackenberg esti-
mates that EvaCon will be market-ready by
2015 — and that by then it will be an extremely
appealing product. “On an annual basis, if a soft
drink producer needs eight cubic meters of ster-
ile rinse water per hour and disposal of associat-
ed wastewater, it currently has to pay about half
a million euros per year per bottling line,” he ex-
plains. “The use of EvaCon for the reprocessing
of wastewater saves about €370,000 annually.
So, given a cost of €325,000 to build the sys-
tem, the investment would be amortized in less
than a year.” CT is working with Siemens Indus-
try Sector’s Food & Beverage Unit to promote
EvaCon, and has already presented the process
to Pepsi in New York.
Wellness for Machines. In another project,
Siemens researchers are investigating how la-
tent-heat storage units could ensure the “ther-
mal well-being” of tomorrow’s machines. In
such storage devices, heat does not cause an
increase in temperature but instead a phase
transition — for example, ice melting to form
water — which remains at zero degrees Celsius
until even the last bits of ice have melted.
High-precision machine tools in particular re-
quire complex thermal management. During
operation they are cooled, and prior to start-up
they are heated so as to prevent an increase in
rejects that would result from thermal expan-
sion of the tools and of the products. Latent-
heat storage units can absorb excess energy
during production and release it to the ma-
chine again during periods of inactivity. “That
would substantially reduce cooling costs, and
no additional energy would be required for the
start-up,” notes Tackenberg.
This project is still in the starting phase, so
no one knows yet which material will be best
for latent heat storage. ORC and EvaCon solu-
tions from Siemens are therefore likely to see
practical use before latent-heat storage units
do. Tackenberg envisions that by 2020 these
and other developments could result in a re-
duction of fossil primary energy escaping as
waste heat from industrial smokestacks from
levels as high as 50 percent to just around
40 percent. According to a study conducted by Siemens
and McKinsey, between 1.1 and 2.5 gigawatts
of usable waste-heat power could be harvest-
ed from ORC technology applications alone.
This would benefit not only the climate but
also suppliers of such solutions. Siemens will
definitely be one of them.Christian Buck
In Moscow, scientists are using Organic Rankine Cycle technology to recover huge amounts of waste heat.
The ORC process, seen here in infrared, can generate electric power even at low temperatures. Pictures of the Future | Spring 2012 109
To meet the worldwide challenge of soaring healthcare costs, medical institutions, physicians, and labs need to make their procedures more efficient. Efficient medical data and image management is essential to this effort.
Although Wisconsin’s Marshfield Clinic has 54 satellite centers, all MRI and X-ray images are evaluated by radiologists across nine locations. IT Invigorates Healthcare Systems
providing healthcare to a rapidly aging popula-
tion. Although less than one in six people are
older than 65 today, by 2050 the equivalent
figure will be one in four. And UN figures indi-
cate that the population in less developed
countries will also have aged substantially by
then. This trend is of particular concern in Chi-
na, where the number of people over 65 is ex-
pected to triple to about 330 million by 2050. How IT Improves Services. Despite extreme
differences, the basic challenge is the same in
all countries: how to improve the quality of
medical care while reducing costs. The answer
to this question lies in our ability to address
several key areas: preventive care, early detec-
tion, personalized therapies, and process opti-
mization. Information technologies (IT) and
the Internet will play a key role in all of these. Indeed, this trend is already starting to
emerge in some countries. In Denmark, for in-
stance, 97 percent of all prescriptions are is-
sued electronically and doctors and patients
communicate via e-mail in 60 percent of all
medical offices — as digital aftercare. In Swe-
den, Iceland, and the Netherlands, doctors and
patients are gaining experience in the remote
medical monitoring of patients with chronic
conditions. Current data, such as a patient’s
weight, blood pressure and blood oxygen lev-
el, are transmitted to the physician via e-mail
or telephone.
In the U.S., the first promising trials are un-
der way for providing overweight patients with
a robot that helps them achieve a healthier
A
nyone concerned with healthcare finances
should review the figures published in the
OECD’s 2011 healthcare report. These include
statistics that show how frequently medical
services, such as office visits and magnetic res-
onance imaging (MRI) examinations, are pro-
vided. And the evidence is clear. In most coun-
tries, these services are being used more and
more every year. This is a welcome develop-
ment, since it is an indicator of improved
healthcare. On the other hand, each additional
examination, each blood test, and each fluo-
roscopy adds to costs.
While developing countries and emerging
markets are confronted with the challenge of
providing basic medical care to growing popu-
lations, industrial nations face the challenge of
Formulas for Efficiency | Software
lifestyle. In this approach, a patient answers a
robot’s questions about weight, nutrition and
exercise — by means of a computer screen
built into a robot. A computer collects and ana-
lyzes this data, and the robot then issues rec-
ommendations concerning nutrition and exer-
cise in a gentle voice.
Behind information technology innovation
in healthcare is the growing need on the part
of large hospitals and laboratories to optimally
utilize personnel and equipment. One such fa-
cility is the Würzburg University Clinic, one of
Germany’s top hospitals. A total conversion of
the clinic’s diagnostic radiology department
from zero to 100 percent digital in 2004
amounted to “a quantum leap,” says Prof. Diet-
bert Hahn, Director of the clinic’s Institute of
Roentgen Diagnostics. As a result, all X-ray
findings at the clinic are now distributed elec-
tronically rather than on paper or film. To further improve the efficiency and speed
of its processes, in 2011 the clinic introduced
Siemens’ syngo.plaza, an agile picture archiv-
ing and communications system (PACS) for
routine clinical reading. The product supports
loading performance of up to 200 images per
second. It also supports central application
management to reduce complexity and costs. To understand the system’s benefits, con-
sider the following example: To analyze the
condition of a patient with severe multiple in-
juries might require hundreds of images,
which used to take several minutes to down-
load from a medical records server to the diag-
nosing physician’s workstation. Now, however,
gram director Dr. Gotthard Rieger is focusing
on this material because it is more resistant to
magnetization reversal than currently available
aluminum-nickel-cobalt compounds. However,
the material results in magnets that are not
quite as stable as those made with rare earth
elements. One way around this might be to
make the magnets somewhat larger so that a
weaker material could be used. “But achieving
this will take time,” cautions Rieger, “as the ma-
terials not only need good magnetic proper-
ties, but also must be sufficiently thermally
stable to be employed in electric cars. What’s
more, we will also need manufacturing
processes that will enable the material to be
mass-produced.”
Other materials may also cause bottle-
necks. “Indium and tungsten could soon be in
short supply,” says Dr. Ute Liepold, a chemist at
CT, who is working on a
method for evaluating a prod-
uct’s raw material efficiency.
She wants to assess the materi-
als contained in products ac-
cording to three factors: their
108 Pictures of the Future | Spring 2012
product’s manufacture has minimized its use
of raw materials. Siemens is also managing a project funded
by the German Ministry of Education and Re-
search (BMBF) that is known as MORE, in
which partners from research and industry are
working together to find solutions for recycling
electric motors. “Although the copper used in
motors is widely recycled today, magnets are
simply disposed of,” says Dr. Jens-Oliver Müller,
who is responsible for the MORE project on
Scheiter’s team. The researchers are therefore
developing methods for dismantling motors
and analyzing the quality of their magnets. De-
pending on their condition, magnets can ei-
ther be immediately reused or melted down in
order to make new ones. In addition, the pro-
ject’s participants are working on chemical
procedures for extracting rare earths directly
from magnetic materials. Since the summer of 2011, CT in Munich
has also been developing the first permanent
magnets that do not contain rare earths. In-
stead, the magnets consist of magnetic nano-
sized rods made of a cobalt compound. Pro-
environmental impact, the reliability of their
supply, and their importance for a product’s
function. Such evaluations will be combined
into an overall assessment, which could be
used, for example, to compare a variety of
electric motors and their magnets in terms of
how efficiency their raw materials are used.
Whereas the environmental impact of a range
of materials could be assessed with the help of
existing tools, standardized methods remain to
be developed for the two other factors. Complicated Mining Processes. No analysis
of potential remedies to the scarcity of certain
materials would be complete without taking
mining into account. With this in mind,
Siemens is working with the RWTH University
in Aachen, Germany, and, by 2015, will invest
€6 million to fund nine doctoral dissertations
focusing on environmentally-friendly methods
for mining rare earths (p. 5). Mining these sub-
stances presents a challenge because they exist in nature only as mixtures of a variety of
rare earth oxides. These oxides are extracted
from ore chemically — using acids, for exam-
ple — after which they are transformed into
metals in a number of melting processes. The
resulting slurries are potentially extremely
harmful to the environment and have to be
processed at great expense, which is why
many mines closed down in the 1980s. The partnership with the RWTH University
was initiated by Prof. Dieter Wegener, head of
the Advanced Technologies and Standards de-
partment at Siemens’ Industry Automation and
Drive Technologies divisions. Wegener has de-
veloped a technique for evaluating “green”
products and solutions with regard to their environmental impact and profitability (see
Pictures of the Future,Fall 2011, p. 81). In the context of a research project, Wegen-
er’s team will for the first time depict the entire
process chain from ore to finished magnets in
an Eco-Care Matrix. “We will be looking for
processes that perform better in the Matrix,
since they would make it economically feasible
to revitalize mines that have been taken out of
service or exploit new deposits,” explains We-
gener. This would be a big step toward reduc-
ing dependence on a handful of suppliers. According to Wegener, it would also make
gearless wind turbines and electric motors
even “greener” and more economical in terms
of the Eco-Care Matrix. Christine Rüth
Rare earth elements in magnets
might be replaced by nano-sized
rods made of a cobalt compound.
Optimizing Energy-Saving Circuitry through Simulation It used to be that the only people who were interested in the energy efficiency of electric circuits were
developers of battery-powered devices such as cell phones, for whom every microwatt of electrical power
was important. “That has changed radically,” says Johann Notbauer, who heads the Technology Field for Ap-
plication-specific Integrated Circuits and Printed Circuit Boards at Siemens Corporate Technology (CT) in Vi-
enna, Austria. “Siemens assesses its entire product range according to green properties, in which integrated
electronics and their energy consumption always play a role,” he explains. For example, his team is currently
working on a circuit for measuring flow rates in pipes. Although it is possible to program a microcontroller
to calculate the flow rate from sensor data, the result is that it consumes a comparatively large amount of
energy. An alternative would be to use an application-specific integrated circuit (ASIC), which would con-
sume less than half as much energy as a microcontroller, but would only be profitable if it were manufac-
tured in large numbers. The decision in favor of software (microcontroller), hardware (ASIC), or something
in between using programmable logic components determines 80 percent of the circuit’s energy use. Not-
bauer’s team is therefore developing a simulation tool that will allow electri-
cal engineers to optimize energy consumption and costs at this ear-
ly stage of circuitry design. The tool splits the circuit’s over-
all function into individual steps, organizing them
into hardware or software components to
ensure minimum energy con-
sumption at low cost. Such a
model was also created for
measuring flow rates in dif-
ferent kinds of pipes. Due to
special anti-explosion requirements,
the circuit used for this purpose was de-
signed to consume only half a watt of ener-
gy instead of five, as was previously the case.
“Although we’ve come up with a number of energy-
saving ideas, our simulation tool will reveal which of
them is actually feasible,” says Notbauer. play a graphic image of the affected part, such
as a faulty valve. Improvements along these
lines could soon come to hospital labs. Web-based services are also becoming very
useful in clinical systems. Such services are
widely used in industry, for instance, to allow
global collaboration between departments
separated by great distances. Similarly, the
days when radiologists have to sit down at a
hospital workstation to evaluate images will
soon be over. In an era in which imaging cen-
ters and hospitals are looking to provide high-
quality care for more patients, an application
such as syngo.plaza helps radiologists and cli-
nicians to expand their services to virtually any
location, all while having access to a wide
range of functionalities.
Other IT applications could go a step fur-
ther — right into “the cloud,” thus eventually
making it possible to store medical records on
a server that a user could theoretically access
from any PC worldwide via the Internet. For ex-
ample, in order to transmit medical data to a
hospital, IT systems could be linked via a se-
cure connection to data centers. Such systems
could learn from each case and from each oth-
er as best practices crystalize from data. In oth-
er words, the greater the number of hospitals
participating, the larger the database related
to a given topic. The goal all physicians share
— to have more time for their patients —
might then be much closer to realization. Katrin Nikolaus
Pictures of the Future | Spring 2012 111
Regardless of whether engineers are developing automation equipment, designing mechatronic
systems, or planning a factory, they all face the same challenge: the complexity of the systems involved has grown immensely, whereas customers are demanding shorter development times and high quality. Integrated processes for development, planning, and production are the answer. Siemens’ IntuPlan factory design system allows participants to visualize complete production processes.
In contrast to computer-based virtual planning tools, the real IntuPlan models can be intuitively used by all participants to analyze and discuss the factory design.
Building a Common Framework control, operation, and monitoring. But with
the TIA Portal, the same components can now
be used for separate applications. The data
have to be entered only once and are then im-
mediately available for all applications. Previ-
ously-developed components are stored on a
central server — tried and tested project data
and earlier versions can be reused again at any
time. The engineering quality of the first test-
ed program can thus be carried over into all fu-
ture projects. The TIA Portal therefore saves
the customer a great deal of effort, time, and
expense. This solution has been on the market
since mid-2009 and is now used by more than
10,000 companies. All of them work with au-
tomation solutions from Siemens, which form
the foundation of the TIA Portal. At the mo-
ment, the customers using the solution are pri-
marily medium-sized firms like Hurst Boiler &
J
immy Bruner is programming the control
system for a new gas boiler. He uses a drag
and drop function on his monitor to transfer
data from the previously developed compo-
nents that he needs for the new product. “We
used to need two or three days to configure a
new boiler — now it’s done in four to five
hours,” says Bruner, a systems manager at
Hurst Boiler & Welding Company, Inc., a manu-
facturer of gas and oil-fired boilers in Coolidge,
Georgia (USA). Such high-speed development
has been made possible by a Siemens solution:
the Totally Integrated Automation Portal (TIA
Portal) — a platform that for the first time
makes all the tools needed for automation sys-
tems available in a unified and integrated de-
velopment environment. In the past, engineers typically used a vari-
ety of software tools to create functionality for
Formulas for Efficiency | Production Processes
tion individually. This reduces maintenance
costs substantially.
To further optimize working procedures,
Siemens has developed software that can sig-
nificantly increase patient throughput for mag-
netic resonance imaging systems. The soft-
ware helps ensure that the table supporting
the patient is swiftly moved into the optimal
position for the required examination. In diffi-
cult cases — for instance when children can’t
remain motionless or seriously ill patients can’t
hold their breath long enough — the software
provides predefined proposals to the radiolo-
gist in order to complete the pro-
cedure as efficiently, thoroughly,
and swiftly as possible. Rapid Error Detection. As is the
case with all hospital departments,
preventing errors is a top priority,
and the clinical lab is no exception.
Here, managers see an urgent need for sys-
tems that can automatically detect contami-
nated samples or chemical reactions that have
gone wrong during a test. This was revealed in
2010 by a survey of 230 laboratory directors in
the U.S. and Europe that was conducted by
Siemens Healthcare Diagnostics. The second-highest priority is the ability to
graphically visualize different laboratory
processes on a monitor in order to swiftly lo-
cate the origin of a problem. To fulfill these
needs when developing new laboratory sys-
tems, Siemens experts have examined au-
tomation systems widely used in industrial and
energy applications. In those industries, even
highly complex systems such as power plants
can be managed via functions displayed on a
screen. In place of error messages with long
columns of numbers that first need to be te-
diously analyzed, such monitoring systems dis-
110 Pictures of the Future | Spring 2012
it might take only seconds thanks to
syngo.plaza. Medical team meetings often ad-
dress the X-ray images of more than 20 pa-
tients. As a result, professionals now save con-
siderable time, which can be used to evaluate
images rather than waiting for downloads. In the U.S., the Department of Radiology at
the Marshfield Clinic in the state of Wisconsin
has shown how IT systems can reduce costs
while also improving patient care. Marshfield
comprises two hospitals and 54 satellite facili-
ties at locations throughout Wisconsin. The ra-
diology department at the main location in
Marshfield provides services to all affiliated fa-
cilities and handles up to 500,000 MRI and X-
ray cases annually. To provide swift diagnostic
evaluations, even during peak periods, the
clinic’s management came up with a solution
that allows all authorized radiologists to view
images at any radiology workstation (assum-
ing all prerequisites are met). As a result, radi-
ologists at nine locations, including one that is
about 3,700 miles away in Hawaii, now use
syngo
.plaza to store, process, and make im-
ages available at any time to the widely scat-
tered satellite facilities.
It’s not just radiologists who are saving time
now. Marshfield’s IT department also benefits
because it can service the Windows-based syn-
go.plaza faster and more effectively, whereas
the old system was Unix-based and only a few
IT employees were qualified to work with Unix.
Since many software systems used in hospitals
around the globe also run on Windows, it’s
much easier now to connect seamlessly with
other networks, servers, and clinical systems.
What’s more, for the advanced development of
its image evaluation systems, Siemens has
chosen a client-server architecture that makes
it possible to install software updates centrally
rather than having to update every worksta-
syngo.plaza displays 2D, and basic 3D images in a unified imaging environment.
Physicians should be able to view patient data from any location.
More Expensive Doesn’t Mean Healthier
Life expectancy in years
64
0
68
72
76
80
84
2,000 4,000 6,000 8,000
Per capita expenditure on healthcare
(in US$, purchasing power parity)
RUS
IND
CZE
DEU
AUT
LUX
FRA
CHE
ESP
NZL
ISR
ITA
KOR
GRC
GBR
IRL BEL DNK
FIN
AUS
ISL
SWE
CAN
NOR
USA
JPN
BRA
TUR
SVK
POL
CHN
MEX
NLD
Source: OECD Health Data 2011; World Bank and national sources for non-OECD countries
Welding. Siemens is using their experience to
further improve the portal, which will then in-
creasingly be used in the complex automation
systems of larger companies. A Look Back.As early as 2005, it was clear to
experts at Siemens Industrial Automation Sys-
tems that their software architecture had to
change in a fundamental way. “We wanted to
put software together to form an automation
system as easily as Lego pieces are combined
to create a new miniature world,” says soft-
ware architect Ronald Lange, who played a key
role in the creation of the portal and was
named Inventor of the Year by Siemens in
2011 for his work on it. This idea gave rise to
development of the TIA Portal, one of the
largest software projects ever conducted by
Siemens. It involved 400 developers from
Formulas for Efficiency
In Brief
Never has efficient technology been as impor-
tant as it is today. At present, we need not only to
bring climate change under control but also to ad-
dress the impending scarcity of resources. Efficient
solutions don’t just save raw materials and energy,
they also save money. (pp. 80, 86) Electricity suppliers in the U.S. have to spend bil-
lions of dollars on rarely-needed peak load power
plants that are used only in times of particularly
high power consumption. When applied to large
numbers of buildings, automation systems from
Siemens can change this picture. Such systems ad-
just power consumption in accordance with price
fluctuations in real time, which flattens out de-
mand spikes and helps to stabilize power genera-
tion and distribution networks. (p. 83)
A stable power grid is needed to significantly in-
crease the proportion of fluctuating renewable en-
ergy in the electricity mix. Almost 200 gigawatts of
wind power generation is already installed world-
wide — at full output, that’s equal to 200 large
power plants. But wind power is often more ex-
pensive than electricity from coal-fired plants.
That’s why Siemens engineers are working on new
ways to optimize wind turbines. (p. 96)
In the future, hydrogen will play an increasingly
important role in the power supply chain — either
as a way to store excess energy produced by wind
and solar power plants or as fuel for cars. What’s
more, the chemical industry can use renewably-
produced hydrogen together with the greenhouse
gas carbon dioxide as a feedstock for polyurethane
and other plastics. (p. 100) Materials researchers at Siemens are continu-
ously looking for new substances that can help
make products better. At the same time, they are
developing methods that allow valuable raw mate-
rials to be reused. (p. 107) Whether engineers are developing automated
equipment, devising mechatronic systems, or
planning factories, all of them are facing a double
challenge. The complexity of the systems involved
has grown immensely, but customers are demand-
ing shorter development times and even higher
levels of quality. Integrated processes for develop-
ment, planning, and production are the answer.
(p.111)
PEOPLE:
Energy Optimization of Buildings:
Thomas Grüne
wald, Corporate Technology
thomas.gruenewald@siemens.com
Dr. Geor
ge Lo, Corporate Technology
george.lo@siemens.com
Management Networked Buildings: Marcus Boerkei, Infrastructure & Cities
marcus.boerkei@siemens.com
Dan Kubala, Infrastructure & Cities
dan.kubala@siemens.com
Solutions for China: Martin Klarer, Siemens China
martin.klarer@siemens.com
Wind Power:
Henrik Stiesdal, Siemens Energy
henrik.stiesdal@siemens.com
Per Egedal, Siemens Energy, peg@siemens.com
Network Optimization / Swissgrid:
Dr. Jan Mrosik, Infrastructure & Cities
jan.mrosik@siemens.com
Dr. Ralph Grothmann, Corporate Technology
ralph.grothmann@siemens.com
Electrolysis:
Erik Wolf, Siemens Energy, erik.wolf@siemens.com
Roland Käppner, Siemens Industry
roland.kaeppner@siemens.com
Waste Heat Recovery:
Dr. Alexander Fleischanderl, Siemens VAI Metals
alexander.fleischanderl@siemens.com
Materials:
Raquel de la Peña Alonso, Corporate Technology
raquel.delapena@siemens.com
Prof. Dieter Wegener, Siemens Industry dieter.wegener@siemens.com
Production Processes:
Ronald Lange, Siemens Industry
lange.ronald@siemens.com
Dr. Christoph Fuchs, Corporate Technology
christoph.fuchs@siemens.com
Citizen Involvement: Matthias Holenstein, Risk Dialogue Foundation
matthias.holenstein@risiko-dialog.ch
Ortwin Renn, Dialogik Institute
ortwin.renn@sowi.uni-stuttgart.de
LINKS:
Global Footprint Network: f
ootprintnetwork.org
Renew
ables: www.siemens.com/renewables
Moscow Power Engineering Institute:
www.mpei.ru
Pictures of the Future | Spring 2012 113
peratures lower, as well as the installation of
equipment at the site to produce solar, geother-
mal, and wind power. The results at the plant are
impressive. Since the project began, consump-
tion of water and electricity, as well as the gener-
ation of CO
2
emissions,have been cut in half,
and gas consumption has been reduced by
about one third.
At Congleton, the motto is “practice what
we preach” — in other words, use as much
Siemens technology as is reasonable, such as
lighting equipment from OSRAM, building sys-
tems from Siemens Building Technologies, and
of course inverters made at the plant itself.
Working with local and regional suppliers
when possible also helps to lower costs and
save energy. Each of the plant’s 500-plus em-
ployees is invited to contribute his or her ideas;
The major benefit of this process is that
changes to the data in individual designs are
always automatically adopted, so that the
model always incorporates the most up-to-
date data. If an engineer changes a detail in
the information technology, for example, this
change immediately appears in the compre-
hensive model. As a result, developers can take
a product’s overall mechatronic functionality
into account even during its design process. This method of automatic model genera-
tion was used at Siemens’ electronics plant in
Amberg, Germany prior to the launch of a new
manufacturing line for programmable logic
controllers (PLCs) that was scheduled for mid-
2012. Here, mechatronic designers launched a
virtual version of a firmware “load module,”
which is used to load the software onto the
112 Pictures of the Future | Spring 2012
three continents who spent years conducting
tests with customers and partners. Siemens
deliberately opted for a process of distributed
development in order to integrate require-
ments from different cultures and maximize
user-friendliness. The reduction of complexity in engineering
is no less important at Siemens today than it
was during the TIA Portal’s development. For
instance, the Mechatronic Design project at
Siemens Corporate Technology (CT) focuses,
among other things, on the efficient develop-
ment of systems that are used to control ma-
chine tools or service robots. “These systems
are characterized by a high degree of complex-
ity, because mechanical, electronic, and infor-
mation technology processes interact synergis-
tically in them,” explains Project Manager
Green Ideas in the UK. Environmentally
friendly factory design is the goal of the “Think
Green” project at Siemens’ Motion Control Sys-
tems’ electronic inverter plant in Congleton, UK.
“In the medium and long term, in a world with
diminishing resources, only companies that op-
erate sustainably are going to be successful. So
what we have to do is to make our employees
more aware of environmental issues,” says Kevin
Dutton, head of Environment and Health and
Safety at the plant. Since Dutton and his coworkers began the
“Think Green” project in 2010, many steps have
been taken to reduce the use of electricity, gas,
and water and the amount of waste material
generated at the Congleton plant. These include
simple improvements, such as setting room tem-
gether and discuss the ideas and experiences
of as many people as possible at the very
start,” says plant design expert Gerald Meckl.
That’s why a process is needed that is simple
enough to enable everyone involved to active-
ly take part, which is exactly what IntuPlan
does. With this Siemens technology, true-to-
scale models are made of production and lo-
gistics components so that experts can move
the individual modules around on a table and
arrange them into layouts that optimize mate-
rial flows. Alternatives are then photographed
and special software, which was developed in-house, converts the images into virtual 3D
layouts for further processing. To date, 15 fac-
tories around the world have been remodeled
or designed from the ground up using Intu-
Plan. Corporate Technology’s IntuPlan software automatically turns photographs of a factory‘s layout into a 3D virtual model.Inventor Ronald Lange with the TIA Portal.
Rainer Wasgint. In the past, mechanical, elec-
tronic, and control components were initially
developed separately by different individuals.
Bringing the results into agreement with one
another required a great deal of effort. “In our
project team, we specifically did not want to
develop a new tool; instead, our goal was to
bring together existing models, improve them
with new methods, and make them available
in a common framework,” says Wasgint. Using
this approach, different pieces of development
data are brought together and integrated into
a comprehensive model. “In this way, static de-
signs are transformed into designs that can be
simulated dynamically,” he adds. A single mod-
el is created automatically, which covers all ex-
isting disciplines. PLC. This made it possible to discover and elim-
inate errors at an early stage. “We showed that
automatic model generation significantly re-
duces product lead time, because the costs re-
sulting from errors are avoided during virtual
development, and redesign cycles are mini-
mized,” says Wasgint. Better than Virtual. Meanwhile, another CT
team has specialized in designing factories. In
view of the fact that modern design tools are
often so complex that only experts can work
with them, the team chose to work with Intu-
Plan (Intuitive Layout Planning). “Despite its
benefits, virtualization on a computer isn’t al-
ways the best method for designing factories
— especially not when the goal is to bring to-
unusual measures are welcome too. One such
initiative that generates excitement during facto-
ry tours is the “wormery”: a composting facility
at the plant where approximately 6.5 metric tons
of organic waste decay into high-quality com-
post with the help of 50,000 worms.
“The project is working because everyone is
actively participating. We’ve discovered quite a
few people here who have a hidden talent for
ecology,” says Dutton. “Thinking green has be-
come part of our corporate culture.” In this
way, he is summing up the central theme of a
number of projects. After all, the TIA Portal,
the Mechatronic Design platform, and IntuPlan
also save resources and energy and protect the
environment by organizing production pro -
cesses more efficiently.Gitta Rohling
Pictures of the Future | Spring 2012 115
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The Future of Energy
Increasing resource scarcity, a major nuclear accident in Japan,
and the onset of global warming are making it clear that the
world’s energy system is anything but sustainable. It will have to
be revamped if we are to increase the share of renewable energy
sources; and we will have to exploit as many carbon-free sources
as possible. In addition, power generation and use must become
much more efficient. The measures needed to bring about such
an energy transition will have to interconnect like the pieces in a
complex jigsaw puzzle. To ensure that our electricity supply will
remain reliable and cost-efficient, it will be necessary to strike a
balance between small, distributed facilities and large power
plants on the one hand and between renewable energy sources
and those based on fossil fuels on the other. What’s more, future
systems will need more computer intelligence, a close-knit ener-
gy Internet in which buildings and vehicles are integrated, many
more energy storage units, high-performance “electricity high-
ways,” new financing models, and broad public acceptance. In re-
sponse to this Herculean task, Siemens is helping to ensure that
the individual pieces of the puzzle form a coherent picture.
Invisible Agents
They manage our flight and rail reservations, instantaneously identify the best products
at the best prices for consumers and corporations, and monitor machine conditions and
inventory levels. They also coordinate the interactions between electronic systems in cars
and make split-second decisions in smart power grids. They are software modules — of-
ten taking the shape of software agents in the Internet of things — and they already rep-
resent a vast and rapidly-growing economy. In fact, software makes up an ever increasing
part of the value added in a wide range of areas. At Siemens, scientists are developing
new software solutions for healthcare systems, factories, energy-efficient buildings,
transport networks — and even entire cities. One of the main goals here is to improve the
ability of software agents to learn, reason, and communicate with each other. Technologies that Touch our Lives
Most of us think of sophisticated technologies as being far away in factories and power
plants. But in many cases, they are very close to us. Examples include weather forecasts,
public transportation systems, Internet services, and automated laboratory analyses of
blood samples taken in doctors’ offices. Finding ways of further improving such seem-
ingly routine features of modern life is an important field of research. Siemens re-
searchers are, for example, not only developing sensors that can predict asthma attacks
in advance on the basis of a person’s breath, but also designing systems that analyze
smells and enhance people’s well-being. In addition, evolving information and commu-
nications technologies, plus the Internet of knowledge, will vastly improve mobility, of-
fice and factory work, and home comfort — while enabling us to reduce energy con-
sumption. These developments will also ease many of the burdens associated with
growing older. Research in all of these areas will be precisely tuned to the needs of indi-
viduals — regardless of their age or where they happen to live. © 2012 by Siemens AG. All rights reserved.
Siemens Aktiengesellschaft
Order number: A19100-F-P193-X-7600
ISSN 1618-5498
Publisher:Siemens AG
Corporate Communications (CC) and Corporate Technology (CT)
Otto-Hahn-Ring 6, 81739 Munich, Germany
For the publisher: Dr. Ulrich Eberl (CC), Arthur F. Pease (CT)
ulrich.eberl@siemens.com (Tel. +49 89 636 33246)
arthur.pease@siemens.com (Tel.+49 89 636 48824)
Editorial Office:
Dr. Ulrich Eberl (Editor-in-Chief) Arthur F. Pease (Executive Editor, English Edition)
Florian Martini (Managing Editor)
Sebastian Webel
Hülya Dagli
Dr. Andreas Kleinschmidt
Additional Authors in this Issue: Martin Arnold, Dr. Norbert Aschenbrenner, Bernhard Bartsch, Dr. Hubertus Breuer, Christian Buck, Nils Ehrenberg, Nicole Elflein, Urs Fitze, Bernhard Gerl, Andrea Hoferichter, Tom Jakobsh, Bijesh
Kamath, Ute Kehse, Michael Lang, Bernd Müller, Katrin Nikolaus, Gitta Rohling, Dr. Christine Rüth, Dr. Jeanne Rubner,Bernd Schöne, Hans Schürmann, Dr. Sylvia Trage, Silke Weber, Johannes Winterhagen
Picture Editing: Judith Egelhof, Irene Kern, Stephanie Rahn, Doreen Thomas, Publicis Publishing, Munich
Photography: Berthold Baule, Peter A. Calvin, Paolo Fridman, Dietmar Gust, Martin Hangen, Johannes Krömer, Volker Steger, Jürgen Winzeck Internet:
(www.siemens.com/pof): Volkmar Dimpfl, Florian Martini
Historical Information:
Dr. Frank Wittendorfer, Siemens Corporate Archives
Address Database:
Susan Grünbaum-Süß, Publicis Erlangen
Layout / Lithography: Rigobert Ratschke, Seufferle Mediendesign, Stuttgart
Illustrations:
Wolfram Gothe, Arnold Metzinger
Graphics:
Jochen Haller, Seufferle Mediendesign, Stuttgart
Translations German – English: Transform GmbH, Cologne
Translations English – German: Karin Hofmann, Publicis Munich Printing: Bechtle Druck&Service, Esslingen
Picture Credits: Semprius (4 b.l.), Osram AG (5 t.r., 56 b.r.), ddp (10 / 11, 35 r., 61 t.l.), picture alliance / dpa (14 m., 22–23, 30 t., 50 b.), private (15, 52 t.), Google
(21 t.), F1 online (33), T-Power (36 r.), Plainpicture / Maskot (38), SkyJuice
Foundation (39 t.), Picasa (39 m.), Imago (44 t.l., 71), Caida (45 t.r.), BSH Bosch und Siemens Hausgeräte GmbH (47 r.), dena (48 t.r.),
action press (50 t., 61 t.r.), Sankt Galler Stadtwerke (51), Bertelsmann
Stiftung (52 b.), Corbis (69 t.), Swissgrid AG (99 t.), Marshfield Clinic (109
t.).All other images: Copyright Siemens AG
Pictures of the Future,syngo, SOMATOM, Intuplan etc. are protected
brands of Siemens AG or associated companies. Other product and com-
pany names mentioned in this magazine may be registered trademarks of
their respective companies.Not all of the healthcare products mentioned
in this issue are commercially available in the U.S. Some are investigation-
al devices or are under development and must be approved or reviewed
by the FDA and their future availability in the U.S. cannot be assured.
syngo
.plaza on mobile devices such as iPad is not for diagnostic use.
Diagnostic use requires a medical grade monitor.
The content of the reports in this publication does not necessarily reflect
the opinions of the publisher. This magazine contains forward-looking
statements, the accuracy of which Siemens is not able to guarantee in
any way.
Pictures of the Future appears twice a year.
Printed in Germany. Reproduction of articles in whole or in part requires
the permission of the editorial office. This also applies to storage in electronic databases and on the Internet.
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