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February 2, 2011

Host: Ted Simons

Foreign Investment

  |   Video
  • Mexico is Arizona's #1 foreign trading partner but Canada trumps our neighbor in the south when it comes to foreign investment. Glenn Williamson, founder and CEO of the Canada Arizona Business Council, discusses the economic ties between Arizona and Canada.
  • Glenn Williamson - founder and CEO, Canada Arizona Business Council
Category: Business/Economy   |   Keywords: money, economy,

View Transcript
Ted Simons: Mexico is Arizona's number one foreign trading partner, but Canada trumps our neighbor to the south when it comes to foreign investment in the state. Here to talk about economic ties between Arizona and Canada is Glenn Williamson, founder of the Canada-Arizona Business Council. Good to see you here.

Glenn Williamson: Absolutely, I'm thrilled to be here.

Ted Simons: Talk about the relationship between Arizona and Canada.

Glenn Williamson: It's one that started 50 years ago. It started with people from western Canada coming down to Arizona and over the years has migrated to real estate, it's gone from agriculture to real estate to now aerospace. It has gone from 20,000 Canadians coming down, to we believe we will be close to 600,000 Canadians this winter.

Ted Simons: Let's first start with geography. Most Arizona residents consider western Canada the region from which we get most of the visitors and investments and such. Is that still the case?

Glenn Williamson: Historically that was the case. Because of 84 nonstop direct flights out of Arizona to Canada, specifically Sky Harbor every week, we see Toronto, Ottowa, and Montreal emerging into this marketplace. Because of the ties with aerospace, it is a very large corridor of traffic.

Ted Simons: aerospace.. It's a biggie.

Glenn Williamson: It's absolutely a big one. We don't sell things to each other anymore, we make things. That example would be Honeywell by the airport sells $400 million in jet engines to Bombardia up in Montreal, who makes a C series of jet and sells it to Mesa Airways who leases it to US Airways.

Ted Simons: Is that particular chain getting stronger or bigger? We've heard that Arizona is boom and bust as far as the economy is concerned. What about that particular aspect of the economy?

Glenn Williamson: We're seeing huge investments made. Canadian companies like Mytel are buying companies down here because they recognize the growth in Arizona. Epcor made a $470 million acquisition of a water company in Phoenix, because they know Phoenix is coming back, this bubble is going to clear up and these companies are preparing themselves for that.

Ted Simons: Let's talk about individuals. I understand a lot of Canadians would go to Florida in years past and maybe move permanently. Now I understand a little migration to here in Arizona, huh?

Glenn Williamson: There is erosion occurring. It's very similar to the grapefruit league and cactus league. Canadians have historically 2.5 million of them have gone to Florida. Now because of taxes and insurance, specifically for hurricane insurance, there is a migratory shift of current. We'll settle for that, our objective now as we go through budgetary problems in our state, we need money. Canadians are sitting on wealth in real estate; residential and commercial, companies that want to move to the states are now looking at moving to regions that don't have snowstorms like the one going through the East Coast and the Midwest. They are buying large homes here and making investments in this community.

Ted Simons: Are they making -- back to real estate here -- are the folks coming down buying second homes or buying investment homes and renting them out for the most part?

Glenn Williamson: Historically it was investment homes. Now it's second homes. It used to be smaller homes but now we're seeing larger homes purchased every week by Canadians.

Ted simons: The profile of the Canadian buying, let's stick with real estate now because it's more of a real estate transaction. The profile, is that changing?

Glenn Williamson: Yes, absolutely. The transition has been the older generations of Canadians in the western provinces that would be looking to come down to get away, now we're seeing businesspeople in their 30s, 40s and early 50s saying, I really like to play golf, I want to have a home somewhere else, I want to be close to California. There's no reason I shouldn't set my home up here and then move my business here.

Ted Simons: Do you think Arizona is doing enough right now or doing a good enough job in attracting some of these businesses?

Glenn Williamson: Arizona is doing a magnificent job. The state of Arizona has had a tourism office in Toronto for a decade, and they have done a great job of doing work across Canada. The new commerce authority has a trade office in Montreal and they are doing that. Governor Napolitano when she was governor went to Canada. I know they are inviting Governor Brewer to go up. The mayor of Phoenix was just recently in Montreal, and he's been up to Toronto, as well. There's an outreach to Arizona recognizing the wealth migration that is opportunistic for the State.

Ted Simons: Think the state is still Mexico-centered? Is it shifting a little bit? What are you seeing out there?

Glenn Williamson: I think it's very important for a state that is a young state like Arizona, that has had long-standing ties to Mexico, as it grows and becomes more international, the reliance on Germany for certain businesses, reliance on Japan for semiconductor businesses, reliance on Canada for other types of businesses is a good blend. As Arizona becomes more international we need to balance the trade partnerships, if you will, across the rest of the globe so we're not geographically centrist to one country. It's no different than if you're a business. You don't want to have just one customer. It's always better to have four or five.

Ted Simons: It's a good relationship even though both sides are a little protective of their hockey teams?

Glenn Williamson: Absolutely. Spectacular.

Ted Simons: Glenn, thanks for joining us, we appreciate it.
Glenn Williamson: I do want to mention one last thing or I will be in trouble. There is a picnic February 5th, Saturday, the great Canadian picnic that's been going on since 1953. Three to 4,000 Canadians go and it's filled with games and all kinds of fun stuff, everyone's invited.
Ted Simons: Glad you got a chance to mention it
Glenn Williamson: I would be in trouble if I didn’t
Ted Simons: Thank you.

Legislative Update

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  • A mid-week report from the Arizona Capitol Times' Luige del Puerto.
  • Luige del Puerto - Arizona Capitol Times
Category: Legislature   |   Keywords: legislative, update,

View Transcript
Ted Simons: Good evening, and welcome to "Horizon," I'm Ted Simons. State lawmakers are working on a variety of bills, including one that would allow guns on university campuses. Speaking of universities, lawmakers this week heard from ASU President Michael Crow about proposed budget cuts to higher education. Joining us with the latest from the capitol is Luige del Puerto from the "Arizona Capitol Times." Good to see you. Before we get to the guns and university business, let's start with the budget. What's the latest?

Luige del Puerto: The budget is like a cloud hanging over everyone's head. It's an issue that much of the discussion and the energy in the capitol is focused pretty much on the budget. I know the House has started their small group meetings. Kirk Adams is starting to get feedback from members on how do you feel about the Governor's proposal. I know they are trying to do the same thing in the Senate, as well. It still looks like the Governor's budget proposal will be the template for whatever the legislature will pass. I've spoken to individual members here, there, and they basically said yeah, there will probably be tweaks, but not substantial changes to the Governor's proposals.

Ted Simons: And a lot of concern regarding ACCCHS and transplant patients on ACCCHS. What's the latest there?

Luige del Puerto: The Democrats invited today a lady who is one of those who lost her transplant coverage as a result of what they did last year. They are still trying to put this issue, the Dems, are still trying to put this ACCCHS issue on the forefront. I get the sense from Republican lawmakers that at this point what they want to do is deal with transplant coverage and deal with Medicaid as one piece. You know, we spoke with Andy Biggs this morning and he said, We don't want to deal with this piecemeal. You will see the legislature take up this transplant issue as a single subject. If they are going to do anything about it, it will be included when they deal with Medicaid and the budget.
Ted Simons: All right. Gun bills, we have one that says increase background check on private gun shows. Another says increase access for guns on public campuses.

Luige del Puerto: Whenever you purchase a firearm at a gun show he's saying let's do a background check on them. What he thinks is the problem is that people, not just from Arizona but from out of state, are showing up at gun shows and throwing down some cash and walking away with firearms. For him, that's a problem. The bill has to be heard first. It's unlikely that will be tackled. The legislature remains a very pro-gun legislature. So any bill that would put more restrictions on people's ability to carry or purchase firearms, it's difficult for me to see any of those bills actually getting anywhere.

Ted Simons: And conversely, the idea of getting guns on university campuses allowing for, in certain situations, allowing for that to happen: Positive?

Luige del Puerto: You know, that's a good question. With what happened in Tucson, you know, like I said earlier, people are having some pause about going ahead with much of this gun legislation. They will push for that bill again during the session, I think. Whether it'll pass or not, it failed a couple of times before, so we don't know. What we know is that this is a legislature that has an increased Republican majority. We would presume there would be more people agreeable to these kinds of legislation. We don't know that for sure.

Ted Simons: Speaking of universities, Michael Crow and other leaders of higher education making their case, and President Crow is basically saying if the cuts go through, per-student spending at ASU goes back to 1960s levels?

Luige del Puerto: That's basically what he's saying. Really his pitch at the Capitol was, Look guys, what we need from you is certainty and stability. We know what our budget's going to look like. The reason is our programs, you know, we have long-term goals. Any time you sort of fluctuate the state investment, state support to the university system, it disrupts their programs. That was the main pitch there. As far as tuition, the Governor's office was hedging whether this would increase the situation. President Crow said he is averse to seeking a tuition fee increase. The reason for it is that the higher education community has three major sources of revenue. State aid, property taxes, and then tuition. So if you cut one leg, if you're going to keep or maintain the same level of budget or programs you have, you have to increase it from the two other sources.

Ted Simons: The Board of Regents chair says she saw ruthless cost-cutting not to the bone but beyond the bone.

Luige del Puerto: We did hear for example the Chancellor of the Maricopa Community Colleges basically say, you know, with this kind of a cut we're not looking at just downsizing things. We're looking at our core mission. Anything that's outside of it will probably have to be let go. He didn't say it quite in those terms but that's what he meant.

Ted Simons: Quickly, the Governor signed a bill aimed at the casino in Glendale. We were talking before the show and you were saying there were some conflicting emotions there regarding this piece of legislation.

Luige del Puerto: One of the reasons why this bill was brought up in the first place is because people have moral objections about gambling. Any kind of an expansion in gambling we disagree with, it's not good for families or for the State. You have the same people who are advocates for property rights. It puts them in this really tough spot of having to decide whether to go with the socially conservative side or with their private property rights side. Some people are very conflicted about it. I saw it took Sylvia Allen some time to vote on this, and she had some pretty intense discussion with Andy Biggs, who is against this legislation. What happens is they decided at the end of the day this is a property rights issue. They were able to separate it to a certain extent from gambling.

Ted Simons: Good stuff, thanks for joining us.

Luige del Puerto: Thank you.

Technology & Innovation: Compressed Air Energy Storage

  |   Video
  • Researchers at the University of Arizona are looking at how to use compressed air to store solar and wind power. Professor Pierre Deymier, director of the School of Sustainable Engineered Systems at the University of Arizona, and graduate student Krishna Muralidharan discuss the project.
  • Pierre Deymier - director, School of Sustainable Engineered Systems at the University of Arizona
  • Krishna Muralidharan - graduate student
Category: Sustainability   |   Keywords: technology, innovation, ua,

View Transcript
Ted Simons: Renewable energy is the focus of tonight's edition of the ongoing series "Arizona Technology and Innovation." How do you store solar and wind energy when the sun doesn't shine or the wind doesn't blow? Tonight we hear from researchers looking at compressed air as a possible solution. I talked to Professor Pierre Deymier, the director of the school of sustainable engineering systems at the University of Arizona, and graduate researcher Krishna Muralidharan, from the U. of A.'s department of material science and engineering about using compressed air to store sunshine and wind.

Ted Simons: Gentlemen, thank you so much for joining us tonight on "Horizon." The goal of this is to store energy, wind energy and solar energy, when there's no wind and no sun, huh?

Pierre Deymier: Yes, indeed. What we know is, if you have solar power, it just works during the day. The idea is to store some of the extra energy produced by the solar panels into some form, in our cases compressed air energy storage, so you can recover that energy at night.

Ted Simons: How do you recover compressed air? How does that work? Compressed air turns into energy. How does that happen?

Krishna Muralidharan: Well, compressed air is the foremost energy, for storing potential energy in the form of compression. When you expand it, the energy that's being stored can then be turned into useful energy as the air is being expanded. It could run a turbine or run the motor of an electrical appliance.

Ted Simons: Can it be also used -- released directly?
Krishna Muralidharan : Yes, it can be released directly. There are some problems, what we call efficiency problems if you just try to expand directly. The means of compressing into expansion.
Ted simons: So compressed air is heated, correct? Driving the turbines from there and thus you've got electricity. Have you got that right?

Pierre Deymier: You don't really need to have electricity. The solar panel produced electricity and it goes to run a pump, like a bicycle pump. It's a mechanical pump that is pulling air in the tank under high pressure. Think about the tank as being your own bicycle tire. You have energy there. It's like balloon, if you release the balloon and you know it's going fly in the air, so it has energy. It's the same thing. When you want to recall the energy, you could run these compressed air from this tank into a turbine for instance, and you can get mechanical work. This work or mechanical energy can be transformed into electricity with a generator or not. It doesn't make sense to us at some point to use a generator to convert this compressed energy, back to electricity to run an appliance. Let's say have you an air-conditioning unit. It is nothing but an electric motor running a compressor. We can use the compressor as a way of running an air-conditioning unit without using electricity.

Ted Simons: And that's an example of a small scale appliance that can be used.

Krishna Muralidharan: Exactly. What we call high efficiency small scale storage system can work, run an appliance on its own without using the power from the electrical grid. The idea is to compress it in such a way that it works in conjunction with the power production of a solar panel. Take a single solar panel, it's unpredictable with the sun. What we have done is to build an appliance that works in conjunction with the power production, and stores it in a very efficient manner. If you put the hand there, you can feel the air getting hotter and hotter. We have developed a prototype where energy is not wasted into heat. It's rather used efficiently just to compress the air completely, not to waste energy in terms of heat. And then doing the same thing during the energy recovery phase.

Ted Simons: So on the small-scale deals, the small-scale storage, is it like a propane tank?

Krishna Muralidharan: Exactly. We use propane tanks or scuba tanks as storage systems. The idea is to completely build the prototype off the shelf equipment. You can get a propane tank and use an appliance to store the air in the tanks.

Ted Simons: These small scale storage projects could have military applications as well, correct?

Pierre Deymier: Whenever you need energy in a place where there is no grid, these types of applications would be useful. One project that we have developed was a telemedicine unit for an Indian reservation. You may not have electrical power but you still need to run the TV to do telemedicine diagnostics of patients. We experimented with the Tohono O'Odham Nation of Tucson. You form the energy not in the propane tank, but store it in the frame of that structure. That's where you have energy ready to be used when you need to use it. You could store your energy into this inflatable telemedicine unit and release the energy when you need it.

Ted Simons: Would that be considered large scale applications or is it a whole different ballgame?

Pierre Deymier: This would be small-scale, still medium scale. We can scale up that type of technology to an entire building. It doesn't have to be just a small unit. We are thinking about a thousand square feet. But for an entire building you could store the energy not in tanks but into the frame of those buildings.

Ted Simons: And I understand as well as another focus here -- and I find this fascinating -- underground storage reservoirs where you can store the energy underground?

Krishna Muralidharan: Yes. There have been successful implementations of such underground storage. The most famous example is the one in Germany where they use this to augment the functioning of a power plant. Another example right in the U.S. in Alabama, where they use underground caverns to store the energy and then use it for augmentation of the working of the power plant. Another one is in Briscoe, Iowa.

Ted Simons: You don't need a huge area, anything that's porous would work, for the most part?

Krishna Muralidharan: Yes. But it's much more than that. You have to ensure there's no leaks and there's been a lot of effort in trying to do what's happening to locate the caverns.

Ted Simons: We're basically talking about squeezing energy out of thin air here with this compressed air. This is fascinating stuff. How are these projects funded? What's going on here?

Pierre Deymier: The projects are funded from the foundation Arizona, and also from the Department of Energy. They are also in cooperation with the research institute for solar energy. A team is supported of researchers and students involving geoscientists and geoscientist and geoengineers for large scale research, material sciences like Krishna, and also civil engineers and mechanical engineers. It is trying to pool the resources and know-how of a large group of members, researches, and students.

Ted Simons: Last question, very quickly. Is this close to being a viable alternative to energy forms we have right now? And if it's close, how close?

Pierre Deymier: So in terms of the last cave storage I mentioned, indeed, it's already in place. The difficulty here is finding appropriate geosites where you can store the compressed air without loss and without leaks. That's one of the difficulties. This technology is already in place. In terms of locating the smallest caves, technology in buildings is not yet tested. For the small scale, it's very close to being operational.

Ted simons: Close enough, do you think? How long do you think we have to wait?

Krishna Muralidharan: I think within a year. The appliances can be integrated that can run just off compressed air. What we are working on is high efficiency operation, so without any loss of energy. The idea of using these compressed air units that can last the entire duration or lifetime of the solar panel itself, unlike chemical batteries where you have to keep changing it. You buy it, it's mechanically robust and the panel could last up to 20 years.

Ted Simons: Again, it sounds very promising. Gentlemen, thanks for joining us, we appreciate it.