Speaker 1: With Laurent's segele end from London and Gerard read from Berlin.
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Speaker 3: Back to the show, maybe reaching a peak, yeah, maybe
Speaker 3: you know, we've had such an explosive growth that sometimes
Speaker 3: it's very different to go beyond that explosive growth. And
Speaker 3: the concept of the three seas a term coined by
Speaker 3: Richard Sperson of Montel The three seas congestion, curtailment, cannibalization,
Speaker 3: and somehow that capture the growing pains of an energy
Speaker 3: system being transformed almost too fast. That's true.
Speaker 1: And actually transformed too fast by solar and that I
Speaker 1: suppose we're already going to talk about, isn't it.
Speaker 3: Yeah, to umpact this, we have invited one of the
Speaker 3: world leading voice in solar energy and it's Sam Wilkinson,
Speaker 3: head of Vulnerables at S and P Global Committee. Inside
Speaker 3: he has a team of twenty experts focused on analyzing
Speaker 3: and forecasting trains around honorable energy markets. So really you
Speaker 3: know what he's talking about. Yeah, so let's bring him
Speaker 3: on the show. Some welcome to the show.
Speaker 2: Thank you very much, Lauren, very happy to be here.
Speaker 1: Maybe just a kick off by just just asking really
Speaker 1: to talk a little bit about the state of the
Speaker 1: global solar market, and then we can dig in dept
Speaker 1: into each of the markets well as we come to
Speaker 1: the end of twenty twenty five. Be great to hear
Speaker 1: your view on what's happened in twenty twenty five and
Speaker 1: global solar.
Speaker 2: I mean, let me just start off right. I clearly
Speaker 2: remember crossing powers with you the first time. Actually, it
Speaker 2: was very early in my career as an analyst, and
Speaker 2: I've been tracking the solar industry since two thousand and
Speaker 2: nine and we're in an incredible place now. Compared to
Speaker 2: where we were back then. You know, back then we
Speaker 2: were talking about single digit gigawatt global market, and this
Speaker 2: year we're going to wind up with something north of
Speaker 2: five hundred gigawatts of solar installed, which is an incredible achievement.
Speaker 2: I should mention that's an ac number. As analysts, we
Speaker 2: throw out different numbers all the time, So five hundred
Speaker 2: and thirty gigawatts is what we think what will have
Speaker 2: been installed this year globally. But the story is defined
Speaker 2: in sort of two hours of a year because the
Speaker 2: overall pace of the global market is defined by China.
Speaker 2: We all know that China's over half of global installations
Speaker 2: has been for the last three years running. But this
Speaker 2: year that the market's changed dramatically. In the middle of
Speaker 2: the year, the market switched from being a market where
Speaker 2: all projects were guaranteed a certain price. So on June
Speaker 2: the first, the policy switched and now projects have to
Speaker 2: compete with each other. And what that meant was that
Speaker 2: in May, in the first five months of the year,
Speaker 2: there was a huge rush to install in China, and
Speaker 2: we saw an incredible ninety gigawatts at sola connected to
Speaker 2: the grid in China in May alone, followed by the
Speaker 2: market dropping down into the single digits Gigawa's you know,
Speaker 2: we're talking less than ten giga what's a month, which
Speaker 2: for a market that's used to installing hundreds of giga,
Speaker 2: what's a year is a very sharp slower So we see,
Speaker 2: you know, in the second half of the year, the
Speaker 2: continuation of super aggressive pricing, very very low margins, and
Speaker 2: from a business standpoint, it's a very complicated place to
Speaker 2: be right now, The.
Speaker 1: Question for me is when does the value of solar
Speaker 1: really deteriorate to the point where installations fall here? And
Speaker 1: you have we reached that point in China now as
Speaker 1: buzzes where I'm coming from, and or maybe just talk
Speaker 1: about then, how you would see this Chinese market going
Speaker 1: for And I'm saying this because obviously it's the biggest
Speaker 1: market for solar in the world, and so it was
Speaker 1: incredibly important.
Speaker 2: I couldn't agree more. So you use the word peak then,
Speaker 2: and yes, according to our current forecast. And I stress
Speaker 2: that because this is a market where policy interventions can
Speaker 2: change things dramatically, and policy is one thing that's almost
Speaker 2: impossible to predict. We've seen China intervene before and stimulate
Speaker 2: its domestic market to help to support its incredible supply chain.
Speaker 2: But right now, based on what we know and what
Speaker 2: we can see and the visibility have, we think the
Speaker 2: annual additions of solar have peaked in China and the
Speaker 2: decrease next year in twenty twenty six is incredibly sharp.
Speaker 2: So we right now in our forecast are talking about
Speaker 2: roughly three hundred gigawa's this year falling to roughly two
Speaker 2: hundred giga what's next year in China? That one hundred
Speaker 2: gig or what drop is? You know is extreme in
Speaker 2: the global context, but you know, we do see the
Speaker 2: possibility that something can be done to support that, and
Speaker 2: then clearly what would be in China's interest to do
Speaker 2: so if they see a justification for it. The other
Speaker 2: thing that you mentioned about the value, you know, that's
Speaker 2: what we're kind of haven't seen yet. So China has
Speaker 2: moved to this competitive system rather than guaranteeing prices, So
Speaker 2: we don't really know quite how that's going to play out.
Speaker 2: One thing I would say though, is we have an
Speaker 2: incredible team of analysts in in China in Shanghai. They're
Speaker 2: constantly talking to the industry and the outlook, talking to
Speaker 2: all the companies in China is very pessimistic. People are
Speaker 2: very concerned about next year. And right now that two
Speaker 2: hundred gigawatts that I'm talking about for China for twenty
Speaker 2: twenty six, it looks on the optimistic side, I would say,
Speaker 2: and some if.
Speaker 1: I just take a step back, if I maybe I
Speaker 1: think we have to just take a step back and
Speaker 1: look at the amount of solar that's been installed in
Speaker 1: the last eighteen months. I mean, if I look at that,
Speaker 1: the rates that we've installed at are almost sort of
Speaker 1: for almost producing in terms of electricity production from that
Speaker 1: eighteen months, we're producing what Japan produces and needs in
Speaker 1: terms of electricity demanding. I mean, the scale of what
Speaker 1: we've done is so crazy that it's at some point
Speaker 1: it had to peak. And if I take the point
Speaker 1: what you're saying is a China's peaking, maybe you could
Speaker 1: talk about the rest of the world. What do you see?
Speaker 1: So maybe if we can just go to different reasons
Speaker 1: like how's India for example, and then you know, maybe
Speaker 1: we going to Europe, North America and other markets to
Speaker 1: talk about then please.
Speaker 2: We can talk about individual markets. But pretty much across
Speaker 2: the board we still see growth on like individual countries
Speaker 2: and particularly emerging markets. And that's a story that continues
Speaker 2: almost everywhere you look. The solar market continues to grow,
Speaker 2: even in places where you tell her about cannibalization and
Speaker 2: how that's impacting on the business model. But the thing
Speaker 2: is that one hundred gigawak drop in China is like
Speaker 2: it's impossible for the rest of the world to step
Speaker 2: up and fill that gap. And what that means is
Speaker 2: right now you're talking about peaks globally. Our forecast suggests
Speaker 2: that next year is for the first time, we are
Speaker 2: predicting that the global solar market and by that I
Speaker 2: mean the amount installed each year declines for the first time.
Speaker 2: It's marginal, you know, we're talking about less than ten
Speaker 2: percent decline. But you know that's the big story in
Speaker 2: our forecast right now. We've never done that. You're going
Speaker 2: back to me joining the industry in two thousand and
Speaker 2: nine and tracking and forecasting it ever since. Never once
Speaker 2: have we, you know, put our hands up and said
Speaker 2: that this global market is going to decline. And I
Speaker 2: actually think that's an interesting moment for the market, right
Speaker 2: because it clearly can't go on growing every year. It's
Speaker 2: just not possible. But this is an incredible supply chain
Speaker 2: that's been built very quickly. It's been built on the
Speaker 2: back of growth, and it just changes the dynamic completely.
Speaker 2: You know, we no longer have that luxury of knowing
Speaker 2: that next year the market's going to be bigger than
Speaker 2: it was the year before in terms of volumes at least, right,
Speaker 2: and that totally changes things.
Speaker 3: So, simon, if I hear you and there's going to
Speaker 3: be one hundred gig less in China, is it going
Speaker 3: to go against the current narrative than China is decobanizing.
Speaker 2: First of all, before I talk specifically about China, it's
Speaker 2: worth just recognizing the fact that we are still installing
Speaker 2: huge amounts of solar every year and other renew as well.
Speaker 2: Despite we're in this my colleagues that are in the
Speaker 2: power and the scenario is being called it this re
Speaker 2: that scenario. We're in this moment where people are just
Speaker 2: reconsidering their positions on the energy transition, thinking more about
Speaker 2: security than decarbonization. Yeah, and it's called this policy reset.
Speaker 2: Despite that, and despite the fact that annual additions globally
Speaker 2: will be less next year than they were this year.
Speaker 2: Over the next five years, We're still going to double
Speaker 2: the amount of solar installed in the world, just because
Speaker 2: the amount we're adding each year is perhaps slowing down
Speaker 2: or is less, or is roughly the same, or it's
Speaker 2: but it's not growing one hundred percent like it has
Speaker 2: done in the past. We're still going to install roughly
Speaker 2: something like two terror watts of solar in the next
Speaker 2: four years. We're just talking about installing five to six
Speaker 2: hundred gigawat's a year, rather than it being more than
Speaker 2: the year before and more than a year before that.
Speaker 2: It's just a total change in the dynamic takes away
Speaker 2: that luxury of growth every year, which which makes the
Speaker 2: supply chain behave in a certain way. That's one of
Speaker 2: the interesting things for me. This supply chain thrives on
Speaker 2: high volume and high scale, and I think people take
Speaker 2: the time to appreciate just how high volume solar manufacturing is.
Speaker 2: Roughly speaking back of the envelope calculation, eighty billion solar
Speaker 2: cells made a year right now something like that. Just
Speaker 2: for context, iPhones is like two hundred million. On smartphone
Speaker 2: market in total is one million. I can't think of
Speaker 2: any other electronic device that is made in that volume,
Speaker 2: and so it thrives on that volume and just continued
Speaker 2: high utilization rates of the supply chain. And people have
Speaker 2: always been ahead of demand, building out supply in the
Speaker 2: hope that demand will come, and we've always been confident
Speaker 2: of doing that. But right now that doesn't feel like
Speaker 2: something we can we can bet on. So I think
Speaker 2: it's going to really change the way the supply chain
Speaker 2: behave as well.
Speaker 1: So so maybe let's move to what the repercussions are,
Speaker 1: because I think that's the really interesting thing. So I
Speaker 1: would have told the first thing I would see is consolidation.
Speaker 1: What else would we think will happen?
Speaker 2: Well, we've already seen this playing out in terms of prices.
Speaker 2: We're talking in the like ten cents of what price
Speaker 2: range now for solo modules, which is something that going
Speaker 2: back in history we almost never would have believed. But
Speaker 2: again on that like volume thing, this volume has allowed
Speaker 2: innovation and cost reduction that people just never saw possible.
Speaker 2: So you know, these prices, whilst margins are either very
Speaker 2: very low or potentially zero right now throughout the supply chain,
Speaker 2: these prices are a factor of that incredible progress that
Speaker 2: the technology has made. Clearly that's going to lead to consolidation.
Speaker 2: You can't have all of these manufacturers making no money.
Speaker 2: So consolidation is one obvious impact. But the other thing
Speaker 2: that this industry has, you know, I meant I'd called
Speaker 2: it like water earlier, but it has this elasticity as well, Right,
Speaker 2: these low prices and this slow down somewhere else, solar
Speaker 2: has this incredible ability to go and find markets and
Speaker 2: make markets. So I see the Pakistan was the thing
Speaker 2: that was talked about like a lot in recent years,
Speaker 2: all of a sudden, like consumed this huge gigawatts of
Speaker 2: solar panels, having not been a solar market previously, and
Speaker 2: there's so many other markets around the world that will
Speaker 2: do that. This sort of unique scalability of solar as
Speaker 2: a power generation technology means that we're going to see
Speaker 2: markets that there weren't there before, in Africa, in Southeast Asia,
Speaker 2: in South America, in these emerging economies, they're going to
Speaker 2: probably start to consume solar because it's such an accessible
Speaker 2: price point. So I think that's one thing. And another
Speaker 2: thing is again the innovation outside of the solar panel. Right,
Speaker 2: almost everything we've talked about today has been to do
Speaker 2: with the panel, and anytime we've related it out to
Speaker 2: the supply chain, but all of the other technology that's
Speaker 2: going into optimizing the building and the maintenance and the
Speaker 2: operations of these assets, adding in batteries to help with
Speaker 2: like making these more flexible and dispatchable. There's going to
Speaker 2: be a real focus on that in terms of maintaining
Speaker 2: like high quality, high performance assets rather than just this
Speaker 2: focus on generating hardware and hooking it up to the grid.
Speaker 1: That's a very good point. So the question for me
Speaker 1: though on that is who does this? In other words,
Speaker 1: is it the module manufacturer that's going to push these
Speaker 1: it's going to be the inversion manufacturer in other words,
Speaker 1: who's going to be the winner out of providing that
Speaker 1: solution to customers.
Speaker 2: Well, there's so many roles to play that it's difficult
Speaker 2: to give us simple answer to that. But one thing
Speaker 2: I would say that we've noticed very clearly in recent
Speaker 2: years is that the module manufacturers recognized these are top
Speaker 2: tier manufacturing companies, right, These these sort of Chinese panel giants,
Speaker 2: they saw this coming and they knew they had to diversify.
Speaker 2: And so you look at the kind of cohort of
Speaker 2: top tier companies there and you see how they've all
Speaker 2: diversified through various methods into energy storage. Some of them
Speaker 2: are making electoralizers, and they're all trying to find other
Speaker 2: revenue streams as well. And the inverter companies too, right,
Speaker 2: it was a very natural step for them to go
Speaker 2: into energy storage power conversion, and now a lot of
Speaker 2: them are for providing full energy storage systems as well.
Speaker 2: So that diversification is very clear, But it comes at
Speaker 2: a time where it's not like these are great industries
Speaker 2: to be in as well. In terms of being a manufacturer,
Speaker 2: they're very overcrowded, as any high growth industry always is, right.
Speaker 2: It attracts a lot of people in and more people
Speaker 2: than the demand can sustain these companies that the manufacturers
Speaker 2: are clearly trying to diversey FI there, but then all
Speaker 2: the other places, right, you know, we look at like
Speaker 2: robotics and drones in O and M, the use of
Speaker 2: AI and optimization. There's so much going on still downstream
Speaker 2: in that sector that there is still plenty of innovation
Speaker 2: to happen. And I just think that that focus actually
Speaker 2: on the sort of high quality projects and systems is
Speaker 2: actually really quite healthy.
Speaker 3: I like the way you think about the future. But
Speaker 3: before we go there. I like to kill the few
Speaker 3: dinosaur along the way. There's been desperate attempts in Europe
Speaker 3: and in the US and diverse administration to build a
Speaker 3: local supply chain of cell up panel and they've thrown
Speaker 3: a lot of money on It's the status of this
Speaker 3: reinsourcing of set up panels.
Speaker 2: Yeah, it's a good question, and it's something that's been
Speaker 2: talked about a lot. Like my thoughts are, i'd see
Speaker 2: the value in building like supply chains. So like I guess,
Speaker 2: you know a confession that start with I think you
Speaker 2: can look at China and the dominance of the supply
Speaker 2: chain either like with admiration or as a threat. I
Speaker 2: have to say that I recognized the dangers of having
Speaker 2: a supply chain concentrated in one country. But I have
Speaker 2: been visiting China and out for like over ten years,
Speaker 2: like regularly. I'd remember the first time I like set
Speaker 2: foot in that country and started visiting these companies and
Speaker 2: I just was just been fascinated by it. Like I remember,
Speaker 2: like I was like Coli Culkin and like home alone,
Speaker 2: like you know, the New York visit where he's like
Speaker 2: hanging out the taxi, like just amazed by what he's seeing.
Speaker 2: I was kind of like that kid, and I've sort
Speaker 2: of like seen these companies grow into incredible technology companies.
Speaker 2: I always tell this story. I visited the same company
Speaker 2: ten years apart, roughly in twenty eleven twenty twelve. It
Speaker 2: was that time when solar inverteds were like impossible to
Speaker 2: get hold of. There was a shortage sober inverters, and
Speaker 2: I remember visiting this company that makes inverters and they
Speaker 2: were literally like building them in the car park. It
Speaker 2: was total chaos. They were running around like couldn't really
Speaker 2: tell what was going on. Ten years later, I visited
Speaker 2: the same company and they're like operation was like the slickest,
Speaker 2: most modern factory I have ever seen, Like this is
Speaker 2: like grade A plus plus plus plus plus manufacturing. And
Speaker 2: the point I'm trying to make is, you know, when
Speaker 2: we talk about China as a threat in terms of
Speaker 2: manufacturing and its dominance, you've got to recognize that it's
Speaker 2: not like a low cost, low quality option anymore. It
Speaker 2: is the leader in terms of cost, it's the leader
Speaker 2: in terms of technology, it's the leader in terms of quality,
Speaker 2: it's the leader in terms of innovation. So there's a
Speaker 2: bit of meaning that always looks at this from a
Speaker 2: very sort of pragmatic standpoint, looking back from the global
Speaker 2: high vision, why not use that great top of the range,
Speaker 2: low cost technology and use it to decarbonize and build renewables.
Speaker 2: So there's that piece of me that always sort of questions,
Speaker 2: why would you want to build a factory that is
Speaker 2: higher cost potentially lower quality. We don't really know, and
Speaker 2: that's a question I always ask myself. But I understand
Speaker 2: from a political point of view, you want to have
Speaker 2: that energy security, you need to build it. So the
Speaker 2: status is jerub To get back to your direct question,
Speaker 2: very little progress has been made. If you look at
Speaker 2: the numbers. Still you're talking eighty to ninety percent of
Speaker 2: manufacturing is in China. There is some factories built in
Speaker 2: the Middle East, in Africa, I in the US that
Speaker 2: gets very complicated with the latest policy changes. In Europe,
Speaker 2: very very little, so it's happening, but still the vast
Speaker 2: majority of product comes from China. And I sort of
Speaker 2: sometimes put myself on the shoes of the end market,
Speaker 2: the develop or the owner of the investor, and they're
Speaker 2: looking at it and saying, well, if the best products
Speaker 2: come from China and the lowest cost comes from China.
Speaker 2: Why do I even want to buy it locally? And
Speaker 2: that's why the politicians have to step in and intervene
Speaker 2: and somehow.
Speaker 1: Enforce Ero sin Sam. I agree with you saying I
Speaker 1: think there's an additional point that I would add to that.
Speaker 1: I think politicians completely misunderstand solar and what I mean
Speaker 1: by that is they think it's like normal fossil fuels,
Speaker 1: which is where I have to go and get a fuel.
Speaker 1: I don't need to get a fuel for that solar panel.
Speaker 1: So once it's installed, it's installed and it's producing electricity
Speaker 1: for twenty twenty five years. If I put a gas
Speaker 1: turbine in, I need to make sure there's fuel there
Speaker 1: for twenty five years, So there's an energy security issue
Speaker 1: for twenty five years you have there isn't that with
Speaker 1: a solar panel. That's the big difference. And I'm totally witcher.
Speaker 1: They're better, they're cheaper, so why not just buy them now.
Speaker 1: I could take the other approach, which is say what
Speaker 1: the US does, which is they say no, we're going
Speaker 1: to do it ourselves, and the result of it actually
Speaker 1: is that they're actually slowing down their own market because
Speaker 1: installation costs etc. Are just way higher than the art
Speaker 1: and the rest of the world.
Speaker 2: Well, yeah, exactly. I've stood back and watched whilst the
Speaker 2: US is politically intervened and you know, in terms of
Speaker 2: trying to localize various different you know, policy attempts over
Speaker 2: the years, and the end result is that the US
Speaker 2: pays double triple the amount of the rest of the
Speaker 2: world for its solar panels. Sadly, we don't know exactly
Speaker 2: how things are going to play out right now because
Speaker 2: we don't have the luxury of any predictability for US
Speaker 2: policy right now. But batteries looks like it all go
Speaker 2: the same way, Like the US is going to be
Speaker 2: more expensive than the rest of the world because of
Speaker 2: tariffs or all the various policies in place. So I
Speaker 2: get that totally, and you're absolutely right the earlier when
Speaker 2: we're talking about peaks, when we talk about peak solar,
Speaker 2: we're not talking about the same thing as peak oil.
Speaker 2: We talking about peak oil. We're talking about fuel and
Speaker 2: how much fuel is consumed. The equivalent when we're talking
Speaker 2: about peak solo would be to talk about how much
Speaker 2: sunshine is coming out of the sky, and that's just
Speaker 2: not even a sensible comparison to make, whereas what we're
Speaker 2: talking about is how much extra capacity is being added
Speaker 2: each year, and even if that declines over the next
Speaker 2: decade or so, which ultimately it would have to at
Speaker 2: some point, we're still adding capacity. And that's just you know,
Speaker 2: going back to what you're saying, we're talking about a
Speaker 2: technology that completely cuts your dependence on fuel supplies in
Speaker 2: the same way that like a conventional fuel would. I
Speaker 2: mean that said, you know, I have to put my
Speaker 2: hand up and say, these conventional fuels do play a role.
Speaker 2: You know, we don't live in a world where we
Speaker 2: can survive on just soda and wind and have a
Speaker 2: stable electricity supply. So we do see a world where,
Speaker 2: especially as power demand grows, because we're living at a
Speaker 2: time where demand for electrons is increasing at a phenomenal rate,
Speaker 2: those like conventional power generation technologies are going to play
Speaker 2: a role in that and we can't bring on enough capacity.
Speaker 2: Like just from Sola and win.
Speaker 3: Well, it's summer. It was a bit of a down
Speaker 3: beat episode. We don't like downbeat. So you's going to
Speaker 3: ask the last question and hopefully there's going to be
Speaker 3: a bit more optimism.
Speaker 1: So Sam, I'd like to actually just get to your
Speaker 1: opinion really on the future so and what it means,
Speaker 1: because actually I didn't take come out of the conversation
Speaker 1: feeling negative. I actually went, my god, this has been
Speaker 1: so crazy that they just it. Notice has just changed
Speaker 1: and we'll have seen new business models, I mean, new
Speaker 1: companies doing things different way and as you said, more innovations.
Speaker 3: How do you see it.
Speaker 2: I agree with you that Jared, we are at a
Speaker 2: moment where things change in terms of annual additions. That
Speaker 2: does force his companies to compete or if they want
Speaker 2: to grow their business for one, but consolidation is somewhat inevitable.
Speaker 2: But the volumes are still incredible, you know, I mentioned
Speaker 2: it earlier, but we're still going to double the amount
Speaker 2: of solar installed globally in the next five years, you know.
Speaker 2: So if you think about how long it's taken to
Speaker 2: get to this point where we are now, how long
Speaker 2: have we been installing these kind of volumes as dolar,
Speaker 2: like roughly twenty years, We're going to achieve the same
Speaker 2: begin in the next five So it's not really the
Speaker 2: same kind of slow down and I don't feel negative
Speaker 2: about it at all. It is forcing people to look
Speaker 2: at different business models. We've somehow gone through this call
Speaker 2: without talking about batteries and energy storage technology. And clearly
Speaker 2: what's happening now is that storage is accelerating to capitalize
Speaker 2: on the volatility that renewables are creating in energy markets.
Speaker 2: But that's also going to enable and it's actually going
Speaker 2: to be critical to allowing solar to continue to grow.
Speaker 2: So one of the numbers I look at very closely
Speaker 2: is the ratio between storage installations and solar installations. And
Speaker 2: if you look at Europe as an exam for the
Speaker 2: last few years, it's actually been surprisingly low. If you
Speaker 2: compare megawats of storage to megawatts of solo, you're talking
Speaker 2: about like ten to twenty percent. By twenty twenty six,
Speaker 2: twenty twenty seven, you're talking about it being like fifty percent.
Speaker 2: And that's because storage is stepping in and accelerating. And
Speaker 2: obviously a lot of that is co located. You're building
Speaker 2: doola with storage attached for very obvious reasons, but also
Speaker 2: a lot of it is just built standalone.
Speaker 1: Now.
Speaker 2: I was looking at the volumes that have been approved
Speaker 2: in the Maxi tender in Italy just a couple of
Speaker 2: weeks ago. Incredible volumes of storage. They're going to go
Speaker 2: into the system and support the renewables that have already
Speaker 2: been installed, but also renewables that will be added in
Speaker 2: the future as well. I don't feel negative at all. Well,
Speaker 2: it's just going to be a change in mindset for
Speaker 2: the industry to innovate without the luxury of growth, and
Speaker 2: there's still incredible progress to be made there in terms
Speaker 2: of volumes you're added each year. Like of course, like
Speaker 2: accepting that moment where things decline for the first time
Speaker 2: is a kind of a bittersweet pill to swallow, but
Speaker 2: I still like maintain that the amount of soilor and
Speaker 2: renewables being built into the future is still something that
Speaker 2: people can feel very positive about.
Speaker 3: Well, some thank you, thank you very much for coming.
Speaker 3: As usual, it's a very sophisticated balance message, which kind
Speaker 3: of differ the almost cult like declaration of people who
Speaker 3: don't know as much as you do. So thank you
Speaker 3: very much for coming on the show.
Speaker 2: No problem, it was as a pleasure to join you.
Speaker 2: I listened to the podcast regularly and it was really
Speaker 2: great to have the chance to come and join.
Speaker 1: Yeah, and Sam, I love having these annual catch up
Speaker 1: with you. So I just want to say thank you
Speaker 1: very much, keep up the great work.
Speaker 3: Wow wow wow one hundred decline next year. Woof, that's heavy. Yeah,
Speaker 3: but you know our listeners.
Speaker 1: I reflect on the podcast. My comment around it is
Speaker 1: what we've seen is peak large scale solar. And the
Speaker 1: reason is because if you've got large scale solar, the
Speaker 1: more you put into it, the more and it goes
Speaker 1: to a power market. You're just incentivized to bring more.
Speaker 1: The future solar is behind the transformer. It is all
Speaker 1: about actually avoiding green costs. That's what iver be really honest,
Speaker 1: that's what's about, and taxes and all that type of stuff.
Speaker 3: There we have realed speak. Oh yeah, yeah, every roof
Speaker 3: every warehouse, every factory will put cellar. That's for sure.
Speaker 3: The revolution to come is beyond the metal. And you're
Speaker 3: right except in places like Texas or the Tibetan Plateau
Speaker 3: or you know those type of things where you can
Speaker 3: still put some huge parks, but at the end of
Speaker 3: the day, you need to put batteries as well. Otherwise
Speaker 3: you're going to be the all infrastructure for a twenty
Speaker 3: five percent capacity. If you build transmission, they need to
Speaker 3: be a food capacity. Otherwise waste of money.
Speaker 1: Yeah, which actually totally brings the point about going about
Speaker 1: behind the transformer. You're actually batteries are all about optimizing
Speaker 1: self consumption. So instead of the faster factor of being
Speaker 1: twenty five percent, you take it to forty percent. That's
Speaker 1: where we're going. And as we both see massive cost
Speaker 1: degradations in batteries and also performance improvements, that's what's.
Speaker 3: Going to happen.
Speaker 1: The capacity factor of that behind the mirror solar is
Speaker 1: just going to get larger.
Speaker 3: Yeah, And finally Africa is gonna turn solar. Egypt, Nigeria,
Speaker 3: South Africa. I mean, all those countries going sold out
Speaker 3: big and this is great, so they won't go through
Speaker 3: the fassil fuel heavy infrastructure phase on the Yeah, they'll
Speaker 3: go to sell o direct.
Speaker 1: And then I think the think we need to add
Speaker 1: to that was again, we've been in batteries for a
Speaker 1: long while. It started ten years ago. Batteries were there
Speaker 1: for you know, one in a balancing in the power
Speaker 1: Market's just that quick response you needed. Now we're not
Speaker 1: talking about six hour batteries.
Speaker 3: Yeah, so you.
Speaker 1: Got solar for let's assume you've got some for nine
Speaker 1: hours of the day and you've got battery for six hours.
Speaker 1: You know where I'm coming from here, You're not far
Speaker 1: off twenty four hours.
Speaker 3: Yeah, and case in point, Pakistan who used to import
Speaker 3: lerg now are still Katar. Thank you. You can keep
Speaker 3: your boats. So that's exactly what's happening, and it's happening
Speaker 3: for cross reason, speed, to install security reasons. Solatics hold
Speaker 3: the boxes. So certainly we'll have a peek, but I
Speaker 3: really trust this industry to rebound, innovate.
Speaker 1: Good my friend, Well, good conversation. Thanks Sam for coming
Speaker 1: out and speak to you next week.
Speaker 3: Cheers.
Speaker 1: Thank you for.
Speaker 3: Listening to Redefining Energy.
Speaker 1: Don't forget to rate the show and subscribe on Apple, Podcast, Spotify,
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