You're listening to Redefining Energy. Your co hosts from Berlin, Gerard Raid and
from London, Lawrence Segal. Episode one hundred. Wow, I can't believe
this is one hundred episode. How long have you been doing this? It's
going to be five years this ortime. Time flies, my friend, every
really does, especially considering our modest starts in the Red Lion pub behind.
Yeah, that's true, that's true. You me getting drinking too much wine
and talking about everything and anything in the energy space and then decided to do
a podcast out about Look. I like to thank all our listener because we
are reaching now nine hundred thousand downblades. Can you believe that? I can't
believe that either, I really can't. It's fun for me. I don't
regard it as a burden. I think there was a period where it was
a little bit of a burden when we're trying to get our hands around the
technology and what to use and what not to use and all this. But
now it sort of works right. Yeah, but wonderful guest, And thanks
to our listeners who just vote for us and listen to us and comment and
we share. I mean guys who will not be there without you. So
there is this new ranking of podcasts on Honorable Energy Who's been released and yeah,
it's incredible. We number two. That's very good, very good,
very I want to know who's one number one, the Energy Gang. But
of course the Energy Gang, the original Energy Gang, was really our inspiration
when we started. So I asked the two member of the original Energy Gang
to join us for episode one hundred. Yeah, it was great to actually
have a conversation with Catherine and Jigger. Can you introduce them? Yeah,
of course. Yeah. Catherine Hamilton is the chair at a business called thirty
eight North Solutions, which is a public policy firm focused on clean energy innovation.
And then you've got Jigger Shah, who is director of the Loan Program
Office at the US DOE Department of Energy, and he's been many years entrepreneur
in the space. You know. Yeah, it's really great to have these
two guys on because they just have so much knowledge and experience. And Catherine
has been a false behind the Inflation Reduction Act. Oh yeah, and actually
these guys, these guys have changed the world absolutely right, that's it,
because what they've done is they've impacted changed like very few other people in the
world had to after the movie. Really, it's a pleasure having the moment
on the show. So let's bring them in, Catherine Jiga, Welcome to
the show, guys. In order to have a great debate, the old
idea was not too much to concentrate on the present, but look at the
future and ask ourself, did we succeed the energy transition? So let's assume
we're in two thirty. Let's assume Elon Muski is finally on Mars. I'm
not if Twitter's going to work from us, but let's assume did the energy
transition work? Catherine, you are only giving us seven years to make this
work, and that is the least amount of time it takes to build any
sort of transmission. Ah, what are you making us do here? I
would say we will have made a lot of progress. We will have built
a lot of things. We will be well on our way in a bunch
of different ways, and there are other places we're going to be really needing
to do some catch up. Jar what do you think part of the problem
with the energy transition is that many of us think about this from a technocratic
point of view, So it's really, will the technologies be ready to scale,
Will it be down the cost curve, Will it be fully approved by
bankers, Will we have institutional capital available. One of the things that we
will have accomplished by twenty thirty in a big way is that everyone in the
world will view the energy transition as a good thing, like that it's actually
better, good quality jobs, better for the environment. It's actually a good
thing, which I don't think is exactly true today. That's why India and
China continue to build coal plants, because they're not sure that the energy transition
will allow them to have enough energy for everyone to live a good life.
The second thing we're going to accomplish by twenty thirty, though, is that
there will be more of an understanding of what it means to have a good
quality job. One of the things that I find frustrating is, you know,
having been in the solar industry for such a long time, so many
people in the solar industry who have been installing solar panels for the better part
of twelve fourteen years still don't view themselves as being in the solar industry from
a career perspective. There's no pension, they barely have any stock in the
companies that they're working with. They may have moved from company to company.
There might be in their fifth company installing solar panels. Right, they don't
have a certificate that's is that they're a good solar installer. They only have
whatever their friends says about them, right, the referral. And so I
do think we're going to fix that by twenty thirty people will be able to
get paid more for being better at their job. They'll actually be able to
get paid more because they do work correctly the first time. And then the
last thing I'd say is that the solar and windustry have the same problems that
the oil and gas industry have, which is it's not clear to me,
but they're always thinking about what it means to be part of the community for
thirty years. Do you want to be friends with the people that you're with
there? What does it mean to be friends? Are you giving back to
the community, are you being a good neighbor? All of those things I
think will be solved by twenty thirty two. I think people will recognize that
they need to have a community benefits plan written and in place with the community
that they're putting ten gigawatt wind turbine farmen or three magawatt solar farmen. Right,
they're going to have a level of agreement. And so those things mean
that we might be able to get everyone excited about the energy transition, which
is not quite true today. Well, and I would just put a finer
point on that and say that if you can't see yourself as part of the
future, then you don't want to be part of that future. And what
we're doing is giving people the ability to participate in their own future and be
part of the solution. And I say that from someone who's a lot of
my family is an Appalachia and Appalachia, a lot of that economy was built
on one resource and now they have to figure out what's next. And they've
been fighting it up to now, and now it looks like people are starting
to understand. Like Jigger said, I'm excited about it. I want to
be part of it. There are jobs available for me to be in it.
But also I can see myself and my family as part of that economy.
Right now, what's happening. It seems that from any generation, we're
a bit of too crossholds, from a bit of a centralized system to a
decentralized system or hyperd or whatever. And I like to hear your opinion into
a thirty about certain technologies geothermal, nuclear, whether it's fission or fusion.
Do you think in those carbon free baseload technology will have done significant progress or
it's still pilots and labs and everything. So Jigger should speak to the nuclear
piece sense. Jigger, you're much more involved than that. But I do
a lot of work in geothermal and hydropower, and I think both of those,
yes, have a much rosier future into twenty thirty. And I look
at some of those technologies that are really trying to do more with less,
having less land and water impact, and really trying to kind of think use
a traditional base load technology in a way that's innovative and more cost effective and
easier to scale. So I see those technologies as really being on a strong
growth potential. Of course, when and solar are so cheap, the issue
for those technologies are going to be much more about being stranded without trans mission
or not have enough land to be on. So I see those as the
strongest technologies. But I'm sure Jigger will have something to say about nuclear power
too, Catherine, Can I just follow up question on geothermals. Firstly,
Yes, if I look at like we've spent the last let's say fifteen years
renewabilizing the electricity system, that's what we've been doing. But what we actually
haven't looked at as heat and heath's a really difficult one. So if I
look at geotermal and you sort of say, actually, it could solve both
problems. It could enable you to electrify more, renewablize more of the electricity
system and also supply heat. And so I'd love to hear your thoughts on
how you see that, on what the potential is. Absolutely that is an
amazing ability of geothermal is that it can do multiple things at different times.
And some of the new technologies are also able to be load following. They
can be useful in a lot of different ways, some of these closed loop
technologies that don't use water and that are able to produce heat and electricity.
And I think it will depend on, you know, what's the better value
at the location and whatever the mix is there. Yeah, I absolutely agree
with you, or I'd answer the question from a slightly different place, which
is that the grid is the largest machine that we have in the world that
no one seems to really prioritize optimizing. When you put a trillion dollars into
something, normally you actually wanted to run efficiently. You wanted to run sort
of a high capacity utilization if you're gonna put that much money into it.
But the grid is run in a way where we're saying, well, you
know, people get dedicated capacity in the grid. That's what this interconnection QUE
means for solar and wind, is that someone wants dedicated capacity. Why do
you want dedicated capacity? Like if we just said to people, no dedicated
capacity, anyone who wants to connect to the grid can as long as they're
using safe equipment and all those things. Well, then what you would have
is a series of curtailment. So at the time at which you had too
much solar too which when you'd curtail, and that curtailment could be captured by
storage, so you could co locate storage and you could say, well,
instead of curtailing, I'm going to dump that power into storage and then I'm
going to put it on the grid when there's room on the grid. This
entire system that we're talking about now costs real money. And so whether you
decide to build a lot of new transmission to inefficiently use it for solar and
wind or other things that need to have dedicated capacity, or you force solar
and wind to have long duration energy storage or other things they're co located so
that they can actually meet a much higher capacity utilization, or you decide to
do geothermal, you improve hydro dams. There's a lot of new technologies now
that can get ten to fifteen percent more out of the same resource, or
you put in nuclear. It's all more expensive than nineteen dollars a mega one
hour, all of it. So part of our problem is that somehow the
Googles and the like facebooks and Amazons and Apples of the world think that they
need to pay nineteen twenty nine dollars thirty nine dollars a megudar, while at
the same time saying we need to be twenty four by seven matched. The
only way to be twenty four by seven matched is to pay seven cents to
kill what hour? Now, guess what, if you want geo thermal to
work, you gotta pay seven cents of kill what are right now? Probably
ten? But I think we can probably get it down to seven. Hydro
is the same. But these projects are not moving forward because people are saying
I'm not going to let you move forward unless you give me power at thirty
dollars a megudar, and the same with nuclear. So to me, it's
not about the technology, although you know we can have a conversation about it.
It's about reframing what it means to generate clean firm generation. Because I
do not believe that we are going to build three x the grade in the
United States that we currently have, which is what all the models suggest.
We need to get to US seventy percent penetration rate of solar and wind,
so I think we might get to one point eight x the grid maximum.
If that's the case and you want to decarbized by twenty thirty five, which
is the president's goal, well then you're going to have to use the grid
more efficiently. So that either means overbuilding solar and wind and putting the excess
power into long duration energy storage which then gets dispatched over time, which is
expensive, or it means moving to nuclear or geothermal or hydro or other things.
But all of its seven cents of kill one hour, and once we
decide that that's what it costs, then all of this becomes a lot easier.
But right now we're in fantasyland and we think we can actually get it
done at twenty nine dollars a mega hour, and that's not going to happen.
We need to shift the discussion from only about clean firm generation to flexible
generation and flexible demand, because that's how we're going to get to one hundred
percent. I was just up in Ontario this week and they're talking about having
to build natural gas and they were super clean, they completely decarbonized, but
they're finding additional demand growth and corporates like Jigger mentioned that are saying we want
one percent renewable, we need to match it to our Well, we're going
to have to work on the demand side too. We're going to have to
have a lot more distributed energy generation resources that are going to be brought in
to be much more flexible as well, so that we don't end up having
to build more fossil fuels. Yeah, you know, I totally agree with
you, by the way, Like I mean, I'm equally working on virtual
power plants at the Department Energy as well, and we have got to change
the way that we manage the grid to be supply following instead of load following.
And I do think we have the technology to do it, and you're
absolutely right. But I also think, Catherine, and I think you agree
with me, that geothermal is just not going to get to thirty dollars a
meguare it's not going to happen. Interesting and an excellent segue you took about
batteries, and of course batteries that's for the grid, that's energy storage,
but now its mostly transportation. And part of our energy transition is how fast
are we going to electrify the transportation sector? And my personal review and what
we saw recently in China oppening and what happens China opens you hope to two
years later and in the US, I don't know when, but I guess
quite not far behind. Is that the ice sector is literally going to collapse,
and the partitions they don't need to put mandate like nothing into a thirty
thirty five and so on, because that's going to happen. My prediction for
two thirty is that we're going to be like nowhere, everywhere, one hundred
percent of the new vehicles just going to be electric I'm not sure about text
us, but in Europe that is for sure, and in California is for
sure. And when I took to young researchers and they're wonderful to see the
speed at which the technology for a battery, the density of battery to cost,
the amount of R and D that has been put in battery makes me
hopeful about the extremely rapid electrification of transport or am I the only one thinking
that? Leron? Can I just add one thing too, It's not just
batteries, because it's also semiconductors, it's electric drives, you name us.
The speed of innovation in and around the electric cars is amazing. And let's
be clear, if you look in China today, by D has now overtaken
Volks are going to be the largest producer of cars in China and it produces
only electric and hybrid cars. So that's the reality of us. I agree
with you, and I think it's going to speed up because China is forcing
us to compete with them in different ways than we did before. Now listen,
I'd love to hear what Chigger and Costom think of about I agree with
you on that. I'm a huge fan of electric vehicle. So I mean,
I'm running the Loan Program's office, and we clearly had a big role
to play in electric vehicles and continue to play a big role in battery manufacturing,
critical minerals, EV charging and all that stuff. I will say that
I feel like people are being a little unrealistic about how long it takes to
change over the fleet. And I also think people are being unrealistic about the
comfort level of Americans. I don't think that the vast majority of Americans,
even in twenty thirty will want all of their vehicles to be electric. The
way it's going to work is they're going to have one main vehicle that's electric.
There other vehicles will be gasoline powered, because remember, the vast majority
of Americans buy used cars. New cars are really only for wealthy people.
So they're gonna have one electric then a gasoline powered car, and they're going
to shift the vast majority of their miles to the electric car because everybody knows
intrinsically that the cost per mile is cheaper with electric. But I do think
that from a comfort standpoint, it's going to be a long time before people
decide to retire the internal combustion engine vehicle from their lives, because I just
think that there's a comfort that people have culturally around being able to fill up
their gas tank in four minutes and all these other things that the electric vehicle
is not supposed to copy. I don't want it to be able to be
charged in four minutes. The fact that I can charge it in my garage
is the best way to integrate with the grid. So I think you'll see
a lot of vehicle miles traveled moved to electric. But I don't think you're
going to see this sort of full transformation to electric vehicles. I don't know.
I agree with part of that jigger. But on the other hand,
I look at other things like incandescent lightbulbs, and you know, it took
a little while for people to go to CFLs, but then once LEDs came
into the market, and we're a better quality, better lighting, cheaper.
It's just happened. That's what you buy when you go to the store.
You know you're not going I'm looking for an incandescent light bulb anymore. The
same happened with low flow toilets, which people complained about for so long.
Oh they're terrible, They're not working. Now that's the only thing on the
market, and that's for a number of reasons. You know. Part of
it is just regulation that we've been, standards that we put into place,
but other is just that the quality was there. There was no reason not
to. It was better cheaper, and I think we will reach a tipping
point for evs where it'll just be cheaper. And yes, you might have
your old Galope in the back just in case you absolutely have to have it.
But even in rural Virginia, where I spend a ton of my time,
people out there are talking about getting electric F one fifty lightnings. They're
talking about well, mostly about getting the Mustang. Actually you're talking about EVS,
and I find that really hopeful. I find that signals to me,
huh, people are seeing this not as this is a climate change issue.
This is about making my life better. Yeah, as usual. I don't
think we differ from each other too much. The only thing I would caution
though here is as opposed to LED lights and low flow toilets, there are
people who actually make their money based on the car that they have, and
for those people, I don't think an F one fifty lightning is going to
work When you think about what the range looks like in an F one fifty
lightning when you add an additional two thousand pounds into the bed of that truck,
or you're towing three thousand pounds, Like every single person in my neighborhood
who comes to cut lawns is pulling a trailer, and the range on the
F one fifty goes from three hundred miles to like ninety six miles when you're
doing that. And so I still think that it's going to take a lot
of time for people who actually have to haul thousands of pounds or do some
of those things to switch over. And I think that's fine, honestly,
because I think we were able to switch over seventy percent of vehicle miles traveled
to electric, which would drop the price of gasoline and diesel for folks,
and I think it would make a huge difference in climate change. Well,
that's why I beg to defer, because we're coming from Europe, and does
this quote Desperation brings innovation and you have the chance of luxury in the US
to produce your own oil and be kind of oil energy independent, which has
a lot of positive and of course a lot of downside between Yorpe. We
need to import ninety percent of hour a certain way. China's the same.
We don't have the luxury to entertain a slow transition. And if you look
where we need to import our oil from, it's from regions with people who
don't really like us. So I believe that when we start the year,
we know that we need to throw four percent of the GDP of a continent
to buy fossil fuel from outside Europe. It's just gone. And my opinion,
and I don't know Jazz agree with me, is that And of course
our distances are much lower than the US, but the fiction of transports going
to go much faster child totally which is around And I would add as well,
don't forget we haven't talked about gas. At the end of the day,
it is a geopolitically imperative for us in Europe to get away from natural
gas. And I say get away from natural gas. It's not just rushing
gas because buying expensive energy it makes sure that our homes are heated. But
I mean, industry just cannot complete when you have to go an import energy
from the say, so we have really big challenges in Europe that you don't
have in the US, you know, and that's why we have to change,
and the US has a choice. I think one of the biggest challenges
in the US is exactly the sector that Jigger was somewhat alluding to before,
which is long haul trucking boy in the US, that is really due for
disruption and innovation. We have to change that. They're just people dying on
the roads every single day because they're driving too long, too far, just
absolutely terrifying. And the US is massive, and so they're driving across the
country. That's how they're paid, that's how they make their living. And
I think that is due for an innovation, not just on the type of
fuel, but also just in the way those jobs are supported and the way
those people have to live. I just think that's something that I've seen a
little bit of that in innovation, and I think that's something that in the
US is going to be a big need for disruption. Can I ask you
a little bit about hydrogen and you've used and I'm coming from as I think
you've got Roll actually said it earlier on. You have everything right, You've
got the resources possible fuel resources and massive renewer resources but you've also got stuff
like an ammonia pipeline and ammonia infrastructure and stuff like that that we don't have
in Europe. And I'd love to just hear your view and how you see
that going forward, where hydrogen will be used in the US, and whether
you're going to be exporting it or what should be doing with it. There's
a number of answers to your question. There are twenty seven or whatever different
use cases for hydrogen than people are hyping these days. We are at maximum
hydrogen hype cycle. From a private sector standpoint, there's probably three or so
applications that are actually happening at scale, so ammonia being the top of the
list. But then some of the other existing use cases of hydrogen are being
considered to be converted from dirty hydrogen to clean hydrogen, and so I think
that that's where you're going to see the bulk of the hydrogen moving today.
You know, I do think we all have to be quite careful about using
header as a panacea for all of these things. For instance, like with
steel manufacturing, I am not convinced that steel is going to go with hydrogen
as the way to decarbonize. There's similar things. Like you know, I
think there's a lot of people who want to put hydrogen into existing natural gas
pipelines and figure out how to then burn it on the other side, which
to me is highly difficult. It's one thing to inject hydrogen into a pipeline,
it's another thing to verify that those hydrogen molecules actually came out the other
side and reduced the consumption of natural gas when burned in some sort of end
use case, and that data is not yet clear to people. So I
do think that, and even on heavy trucks and medium d trucks, hydrogen
could be an extraordinary range extender, basically for electric trucks that need to go
a much longer distance and don't want to carry another five thousand pounds of batteries.
That being said, you need refueling stations that are probably refueling two tons
a day of hydrogen to make that infrastructure cost effective. So you would need
to establish corridors or use cases where you can get that concentrated refueling, like
dredge trucks at ports or other fleets. And so we're very bullish on hydrogen
in the United States, and certainly we're getting an extraordinary amount of investment here
because of this new forty five V tax credit that we put in place.
But I do think that people need to be a little bit more cautious about
thinking that hydrogen is going to solve all the world's problems. Sugar, Can
I ask you, look, we talked about it up to two thousand and
thirty. I'd love to hear your vision beyond that. How do you see
us if you're here in two thousand and forty, two thousand and fifty,
how do you see the world. Do you look at a positively, look
at negatively? I always see the world positively. I think when you think
about where we are, our forefathers couldn't have dreamed about all the things that
we have at our fingertips, and the fact that we have access to all
this information. You now have AI where can write essays in your voice,
right. I mean, there's all this extraordinary stuff happening, which I think
is great. But in every generation you also have challenges, whether it's feeding
the world, or figuring out how to reduce climate change, or figuring out
how to reduce slavery that still exists around the world today. Human rights and
so we always aspire to do better, but I do think that the tools
that we have available to us are quite powerful. Nuclear fission will be commonplace
again in the forties. You will see that being used, even at the
micro level. Nuclear will end up replacing almost all diesel generators in the world
better than solar plus batteries. Storage will on the micro side, and then
I think fusion will come. It probably won't be until twenty fifty, but
we will end up in a much better place as a result. So I'm
quite positive about it. But I do think that the underlying trends around democracy
and autocracy and figuring out how we become more inclusive, as Catherine suggested earlier,
and how people see their own well being in this transition is going to
be key, and I don't think we spend enough time on that. Yeah,
Gerard, I was going to use chat GPT to respond to your question,
but because I would probably give you a better response. But I digger
on this in some ways. I think a lot, obviously about public policy
and the need for political will to do things, and how you're sort of
necessity being the mother of invention or catastrophe, the need to change being the
drivers I now fear the need for political will, because politicians are the least
brave people out there in most circumstances. But I do believe in this generation
coming up behind us, and they don't all have to be technologists, they
don't have to be engineers or scientists. A lot of these are just people
who want the world to thrive. They want to thrive, they want to
be in a better place, and they'll look at my kids, and eventually
I'll look at my grandkids and say like they're the ones that are going to
keep going as well all of ours, and that they're the ones that are
going to take those solutions into the future in a way that we may not
even be able to imagine. I can tell you I'm probably even more optimistic
than you are, because when I see the young generation, the people in
their twenties and the thirties, and how well they are trained, and how
qualified they are, and how absolutely determined there how to put the dis energy
transition forward. Maybe I'm only tooking to our silo, but I love their
thrust and their positive attitude, and the young generation is going to succeed the
energy transition. That would be my final world job. I love it,
guys, really, thank you very much. I love the conversation today.
This was pretty It was a treat for us. Great epis on one hundred
and I hope to see you for episode two hundred if we still around.
And here's the dirty little secret, Laune. Whenever the Energy Gang decided to
do something that was remotely about Europe or about any other part of the world,
I would go back and look at Redefining Energy and listen to you all
to try to make sure I was on target. Thank you Katherine, thank
you, Jiga, Thank you so much. Guys, my pleasure, thanks
for having thank you every brilliant yead. I'm so emotional. It's the French
in you, that's what it is. Why, oh my god, I
mean that's so cool. I feel part of something much bigger than me.
Well, that's actually the energy transition is. It is great to see these
let's call the early movers in this industry now really beginning to impact change.
And that's Catherine and Jaker, that's what they are doing. What's really interesting
for us, based in your hope versus in the US, is even if
the solutions are the same, the political and enjoymental contexts are so different in
a certain way. We do the energy transition because we don't have a choice,
But you know, us, they have a choice and they still do
it. And of course it's more difficult because you've got legacy energy US who's
going to fight every inch of the energy transition. I think the US is
much more practical about energy than we are because it's all about money. So
if you've got to taxes, they're embracing both the past and the future.
We in Europe are very dogmatic when it comes to it's either you're either in
the fossil fuel camp or the renewable camp. But you can't be in both
of them, right. I like the US approach and mustimation. Yeah,
and at the end of the day, we all need together. And I
think it was great to have them. I mean, it's so grateful on
the show episode one hundred and jad. I hope they'll join us for episode
two hundred. I hope so too. Yeah, that'd be great, Okay,
Jah, great epis. I really thank you Katherine and Jiga and I
talk to you in two weeks time, look forward to its. Thank you
for listening to Redefining Energy. Don't forget to rate the show and subscribe on
Apple Podcast, Spotify, or the platform of your choice.