Criticism of Peltier Chips

The story I posted yesterday about two Utah teenagers receiving Ricoh's Sustanable Development award for their Peltier-chip powered air-conditioner (I'm sure that's a misstatement, so feel free to correct) has generated a lot of heat around the blogosphere: the two comments I received seemed indicative of the criticism being expressed. This one even got slashdotted, and the debate's going strong over there. I linked to Wikipedia's definition of the Peltier effect yesterday -- the brief overview reads:

The Peltier-Seebeck effect, or thermoelectric effect, is the direct conversion of heat differentials to electric voltage and vice versa. Related effects are the Thomson effect and Joule heating. The Peltier, Seebeck, and Thomson effects are reversible; Joule heating is not, and cannot be, under the laws of thermodynamics.

I understand, at a very basic level, the concept as expressed in the first sentence -- sounds like the turning fire into ice from The Mosquito Coast. After that, though, I'm lost. So, consider this post "Peltier effect for dummies/English professors," and discuss...

UPDATE: Jeremy Faludi at WorldChanging has some thoughts on this development. He notes the inefficiency of Peltier chips, but also throws out some ideas that demonstrate the potential of this invention.

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