WEBVTT 1 00:00:04.400 --> 00:00:07.879 With Laurent's segle and from London and Gerard read from Berlin, 2 00:00:08.439 --> 00:00:10.199 this is redefining energy. 3 00:00:10.640 --> 00:00:10.960 Today. 4 00:00:11.000 --> 00:00:15.439 On redefining energy, we are going to have a discussion 5 00:00:15.480 --> 00:00:18.800 that took place early in the year in Oxford University. 6 00:00:19.440 --> 00:00:23.120 Laurent Professor Jan Rosnell had a lively discussion in and 7 00:00:23.199 --> 00:00:27.000 around the future of the energy transition, and sadly I 8 00:00:27.079 --> 00:00:29.399 wasn't able to make it because I got a new 9 00:00:29.440 --> 00:00:32.320 replacement and I wasn't able to travel. 10 00:00:32.560 --> 00:00:34.000 But it was a good discussion. 11 00:00:33.600 --> 00:00:37.719 Around Yeah, I went totally off pissed because I had 12 00:00:37.719 --> 00:00:43.719 prepared something bit philosophical to honor Oxford. So I talked 13 00:00:43.759 --> 00:00:49.119 about Aristotle, I talked about Jocklythian. But we managed to 14 00:00:49.479 --> 00:00:54.200 cover everything together and have a very very lively conversation. 15 00:00:54.960 --> 00:01:00.079 Plus it was in the beautiful library of the Oil College, 16 00:01:00.159 --> 00:01:03.840 and really I felt extremely privileged to be invited. And 17 00:01:04.200 --> 00:01:04.599 sorry you. 18 00:01:04.599 --> 00:01:05.760 Could not make it. 19 00:01:05.200 --> 00:01:08.319 It's a good way to take a step back and 20 00:01:08.439 --> 00:01:12.760 look at the big picture and discuss power politics, the 21 00:01:12.840 --> 00:01:16.599 price of netzio. So let's listen to the conversation. 22 00:01:20.920 --> 00:01:25.280 All right, let's start. Welcome everybody, this is quite a 23 00:01:25.319 --> 00:01:29.120 special event. You're not be many times that we have 24 00:01:29.640 --> 00:01:32.560 had a public event in the Senior Library. I believe 25 00:01:32.560 --> 00:01:34.400 in the history of the college, so it's quite a 26 00:01:34.439 --> 00:01:37.120 special thing for the college. Today we're doing a live 27 00:01:37.200 --> 00:01:40.079 podcast recording, which might be the first time as well 28 00:01:40.120 --> 00:01:42.000 in history that this has happened at Oriel College. 29 00:01:42.040 --> 00:01:44.640 I don't know. You're very lucky to get seats. 30 00:01:44.680 --> 00:01:47.959 Within two hours the event had sold out, even though 31 00:01:47.959 --> 00:01:50.480 there was no price tech, but all the tickets were 32 00:01:50.519 --> 00:01:54.079 gone within just about two hours. Just let me briefly 33 00:01:54.120 --> 00:01:56.640 say what we're going to do, then introduce the podcast 34 00:01:56.640 --> 00:02:00.280 and Laurent. So we have about thirty maybe forty it's 35 00:02:00.319 --> 00:02:03.640 for conversation, and then we have some time for more 36 00:02:03.760 --> 00:02:06.799 informal conversation that will not be as part of the podcast. 37 00:02:07.480 --> 00:02:08.080 Let me now. 38 00:02:07.959 --> 00:02:12.800 Introduce Redefining Energy and Laurent Segalin. So Redefining Energy is 39 00:02:12.840 --> 00:02:16.520 actually one of the world's top three podcasts on energy 40 00:02:16.520 --> 00:02:21.000 according to Google. So when you google energy podcast top 41 00:02:21.000 --> 00:02:23.240 in the world, I think Redefining Energy comes up at 42 00:02:23.319 --> 00:02:26.199 number three. And you had six hundred and fifty thousand 43 00:02:26.599 --> 00:02:30.360 downloads last year. Yeah, last year. 44 00:02:30.479 --> 00:02:31.599 It's a great podcast. 45 00:02:31.840 --> 00:02:33.599 I've listened to it for more than I think it's 46 00:02:33.599 --> 00:02:37.039 now eight years and Laurent is here. You may have 47 00:02:37.120 --> 00:02:40.319 noticed alone. The other co host, Zarad Reed, is not 48 00:02:40.360 --> 00:02:43.719 able to come today. He has injured his leg unfortunately 49 00:02:43.759 --> 00:02:47.240 and can't travel here. So it's just the two of us, 50 00:02:47.360 --> 00:02:49.639 but we're going to have a good conversation, I'm sure. 51 00:02:50.000 --> 00:02:53.400 Let me just briefly introduce Laurent. Laurent is a former 52 00:02:53.680 --> 00:02:57.719 investment banker. You've worked in finance for something like three 53 00:02:57.800 --> 00:03:04.960 decades for organizations like Lehman Brothers, PwC, Nomura and many others. 54 00:03:05.280 --> 00:03:08.039 And Laurent has traded I think it was one billion 55 00:03:08.159 --> 00:03:12.319 dollars worth of energy commodities over the course of his career, 56 00:03:12.680 --> 00:03:15.000 which is a huge number, of course, and you have 57 00:03:15.080 --> 00:03:17.960 set up several digital platforms for trading when you were 58 00:03:18.280 --> 00:03:22.599 electricity battery integration and things like that. But now you 59 00:03:22.680 --> 00:03:26.039 are a professional podcast co host, and that's why we 60 00:03:26.120 --> 00:03:29.759 have you here today, and we have sort of turned 61 00:03:29.800 --> 00:03:32.639 this on its head. So the questions that we're going 62 00:03:32.719 --> 00:03:35.639 to discuss actually from all of you from the audience, 63 00:03:35.759 --> 00:03:38.159 and we have a list here. We have so many 64 00:03:38.240 --> 00:03:41.639 we can't go through the fifty or so questions we received. 65 00:03:42.000 --> 00:03:45.000 We had to select and cluster them. We do our 66 00:03:45.080 --> 00:03:48.479 best to cover as much as we can. At this point, Laurent, 67 00:03:48.520 --> 00:03:51.599 I think I handed over to you and you hopefully 68 00:03:51.639 --> 00:03:54.680 don't tell me that I have misrepresented you in my 69 00:03:54.840 --> 00:03:57.919 introduction or Redefining Energy, And I think you have prepared 70 00:03:58.319 --> 00:04:01.439 a little bit of an introduction. You want to mention Aristotle. 71 00:04:01.479 --> 00:04:03.560 I think as well, that's what I heard from you before. 72 00:04:04.039 --> 00:04:06.560 So let's see how a res total features in this podcast. 73 00:04:07.080 --> 00:04:09.800 Yeah, first of all, thanks Ian for having me. You 74 00:04:09.800 --> 00:04:13.000 can hear from my voice that had a very busy yesterday. 75 00:04:13.879 --> 00:04:15.800 The first thing I like to say is thank you 76 00:04:15.840 --> 00:04:19.079 all for being here, and it's for me. It's a 77 00:04:19.120 --> 00:04:22.240 great honor. It's very humbling as well. Now we as 78 00:04:22.279 --> 00:04:24.920 you noticed with Jarre, we did three hundred to four 79 00:04:24.959 --> 00:04:28.360 hundred episode of the pod. And what a journey because 80 00:04:28.399 --> 00:04:31.399 at the beginning, with just two bankers getting drunk in 81 00:04:31.439 --> 00:04:35.079 a pub near PICCADII and and to saying, oh, we're 82 00:04:35.120 --> 00:04:38.680 so intelligent, we should record what we're saying, which we 83 00:04:38.720 --> 00:04:42.319 did and the rest is the story. Now, before we 84 00:04:42.360 --> 00:04:45.160 answer to those questions, there's a question you need every 85 00:04:45.160 --> 00:04:47.160 one of you to ask yourself, and it's a question 86 00:04:47.240 --> 00:04:50.920 I also asked myself, it's not really why are we here, 87 00:04:50.959 --> 00:04:54.680 but why are you here? How did you come to 88 00:04:54.800 --> 00:05:00.759 be interested in environment, energy, security, transition technology? That all 89 00:05:01.040 --> 00:05:04.920 umbrella And this is why I'm gonna use Aristotle, the 90 00:05:04.959 --> 00:05:10.759 famous triangle of Aristotle Ethos, logos, pathos. So itthos. You 91 00:05:10.839 --> 00:05:13.680 read the Paris Accord, you want to save the planet. 92 00:05:13.879 --> 00:05:19.439 You heard great Athumburg at Davos, you read the Mark Karne, 93 00:05:19.439 --> 00:05:22.600 the tragedy of the Horizon. It's going to be the 94 00:05:22.639 --> 00:05:25.680 tragedy of Alberta trying to see set. So basically, we're 95 00:05:25.680 --> 00:05:28.199 going to give the oil industry everything they want. You 96 00:05:28.279 --> 00:05:31.240 had the red Larry Finn two twenty, the head of 97 00:05:31.279 --> 00:05:35.680 black Hawk Finance is now Climate Finance. Everything is ESG 98 00:05:35.959 --> 00:05:39.959 something he has now totally forgotten. But ethos is good 99 00:05:40.000 --> 00:05:42.519 because at the end of the day, that's how laws 100 00:05:42.560 --> 00:05:46.600 get passed. So maybe that's ethos, or maybe that's going 101 00:05:46.680 --> 00:05:49.920 to be logos. So logos. You're going to read your 102 00:05:50.040 --> 00:05:54.160 b and EF reports, Amber report, I see Dave and 103 00:05:54.279 --> 00:05:58.360 Kingsmila here externary data. You're going to run your models, 104 00:05:58.959 --> 00:06:02.399 you're l Coe, You're going to calculate your sparks spread 105 00:06:02.399 --> 00:06:05.879 and you're going to conclude that, yes, the environment is 106 00:06:06.199 --> 00:06:10.000 mathematically what needs to be done. And of course the 107 00:06:10.079 --> 00:06:12.360 last one is the pathos. And that's who I am, 108 00:06:12.839 --> 00:06:16.399 and that's why I'm here. Because when I was twelve, 109 00:06:16.639 --> 00:06:19.160 as I was doing a school trip in Germany, they 110 00:06:19.160 --> 00:06:21.800 brought us at the border of West and East Germany 111 00:06:21.839 --> 00:06:24.800 and I saw, I saw country divided in two. I 112 00:06:24.839 --> 00:06:29.639 saw kilometters of barb wires, mirrauders and the Russians already 113 00:06:29.680 --> 00:06:33.800 the Russians putting the old country in jail. When I 114 00:06:33.839 --> 00:06:37.079 got fifteen, there was the biggest oil spill ever on 115 00:06:37.160 --> 00:06:42.040 my Belov province of Brittany, where a ship called amucokaddis 116 00:06:42.560 --> 00:06:45.839 So and that as part of BP run on ground two 117 00:06:45.920 --> 00:06:48.600 hundred and twenty thousand barrel of oil. It was the 118 00:06:48.639 --> 00:06:53.000 moment we had the oil crisis. So the government sided 119 00:06:53.639 --> 00:06:57.879 with the oil company and we bretons. We went shovel 120 00:06:58.199 --> 00:07:03.120 bucket and we clean ourselves beaches. So my interaction with 121 00:07:03.800 --> 00:07:07.720 the environment is not the ethos or the logos, is 122 00:07:07.959 --> 00:07:12.720 being fifteen on a beach in Brittany. And then the 123 00:07:12.800 --> 00:07:15.800 last one, as I was at PwC and we were 124 00:07:16.319 --> 00:07:20.160 preparing the carbon markets. That was in September two one. 125 00:07:20.240 --> 00:07:22.800 I had some very good friends at the one hundred 126 00:07:22.839 --> 00:07:26.360 and fourty level of the Norse Hour of the World 127 00:07:26.439 --> 00:07:29.120 Trade Center, and we had a cold that day call 128 00:07:29.160 --> 00:07:32.600 which never happened, and I lost Carton Bartel's and Adam 129 00:07:32.680 --> 00:07:36.800 White made their name be said, so they are not forgotten. 130 00:07:37.800 --> 00:07:40.680 And this is where you realize that old relationship with 131 00:07:40.720 --> 00:07:44.079 the Middle East, just because of oil, makes the old 132 00:07:44.120 --> 00:07:47.360 world toxic. So you ask, what are my deep levers 133 00:07:47.639 --> 00:07:51.920 for energy security against the Russian, against oil, my commitment 134 00:07:51.959 --> 00:07:56.040 to the environment. These are the seminal moments. Now I 135 00:07:56.160 --> 00:07:59.160 can go outside with a loud speaker, but my friend, 136 00:07:59.439 --> 00:08:01.680 that friend of yours, told me, you need to be 137 00:08:01.759 --> 00:08:05.639 inside the system to change it, because if you're outside shouting, 138 00:08:05.680 --> 00:08:07.720 you're going to feel good about it. But nothing's going 139 00:08:07.800 --> 00:08:10.800 to change. And how do you change? Change it to finance, 140 00:08:11.160 --> 00:08:13.519 You change it to investment, and you change to try 141 00:08:13.560 --> 00:08:17.079 to redirect whatever money is put into facili fuels into 142 00:08:17.319 --> 00:08:20.639 better technology. Now it works most of the time, sometime 143 00:08:20.720 --> 00:08:24.000 it doesn't. It's okay, you try and try again. So 144 00:08:24.040 --> 00:08:27.600 sorry for this long introduction. Everybody has his own angle 145 00:08:28.360 --> 00:08:31.399 is all past, is all cultural shift and even the 146 00:08:31.480 --> 00:08:34.320 question you're going to ask now, which are very valid, 147 00:08:34.639 --> 00:08:38.600 We'll have different answers depending where you stand. You'll get 148 00:08:38.600 --> 00:08:40.600 a good answer in Oxford. You ask the same question 149 00:08:40.720 --> 00:08:43.799 in Houston, Texas or in Beijing, and you will have 150 00:08:43.840 --> 00:08:46.480 always good value. So ask your first question. 151 00:08:47.240 --> 00:08:49.840 The first question. It's difficult to pivot from a very 152 00:08:49.879 --> 00:08:53.840 personal story law to what is a fairly abstract but 153 00:08:54.000 --> 00:08:57.960 super important issue. The first question is really around are 154 00:08:57.960 --> 00:09:01.960 we actually in an energy transition? Several questions that people raised, 155 00:09:02.519 --> 00:09:04.679 some of you things suggests that, well, haven't we seen 156 00:09:04.679 --> 00:09:07.600 a bit of a backlash against transition recently? Other people 157 00:09:07.600 --> 00:09:10.159 have talked about an energy addition because we still see 158 00:09:10.159 --> 00:09:13.519 fossil fuels rising. So this is the first question we 159 00:09:13.559 --> 00:09:17.679 would like to discuss. I certainly have my views on 160 00:09:17.720 --> 00:09:20.279 this question and have worked with several people in the 161 00:09:20.320 --> 00:09:23.600 audience trying to get to an answer. But Lauren, do 162 00:09:23.639 --> 00:09:26.200 you want to kick us off on this question and 163 00:09:26.240 --> 00:09:29.919 then I can offer my perspective as well and then 164 00:09:29.960 --> 00:09:31.679 see where we end up before we move on to 165 00:09:31.759 --> 00:09:32.279 the next one. 166 00:09:32.679 --> 00:09:36.759 Excellent. So when it's come to predicting the future, the 167 00:09:36.799 --> 00:09:39.639 first thing is to look back at the past prediction 168 00:09:39.799 --> 00:09:42.919 of the future which were made when it comes to energy, 169 00:09:43.720 --> 00:09:45.879 and if I'm in two thousand and I look at 170 00:09:45.919 --> 00:09:48.799 the best expert in two thousand of how they see 171 00:09:48.840 --> 00:09:51.799 the next ten years. There are two words that they're 172 00:09:51.799 --> 00:09:55.720 not going to use is aed and shale gas, which 173 00:09:55.799 --> 00:10:00.679 means nobody sow coming even five years before the two 174 00:10:00.720 --> 00:10:06.240 most important energy events of the decade. If you're in 175 00:10:06.279 --> 00:10:09.639 two ten, you know what's gonna happen. There's a beautiful 176 00:10:09.720 --> 00:10:12.440 Mackinser report from two or twelve which I keep because 177 00:10:12.440 --> 00:10:15.120 people say it does not exist. It exists. I have 178 00:10:15.240 --> 00:10:19.519 it on my hard drive, The Future of Automotive Okay, 179 00:10:19.679 --> 00:10:23.720 full of hydrogen. Of course, the word electric is written 180 00:10:23.759 --> 00:10:26.720 once in that two or twelve report. If you ask 181 00:10:26.799 --> 00:10:29.679 the people like me who are already investing in solar 182 00:10:29.720 --> 00:10:32.879 into ten, well, the price of the panel is going 183 00:10:32.960 --> 00:10:35.200 to be it was at four dollars or what or 184 00:10:35.320 --> 00:10:37.039 is so look, if we manage to get that three 185 00:10:37.080 --> 00:10:39.200 will be lucky off At the end of the decades 186 00:10:39.240 --> 00:10:43.639 are twenty cents, which means nobody saw that coming either. Okay, 187 00:10:43.879 --> 00:10:47.120 you do in two or twenty the future, do you 188 00:10:47.200 --> 00:10:50.360 know what nobody talks about that a sentence. Nobody talks 189 00:10:50.360 --> 00:10:53.799 about batteries or they talk about batteries within car. Nobody 190 00:10:53.799 --> 00:10:58.399 talks about energycy So just this to explain you. The 191 00:10:58.440 --> 00:11:04.240 future is very hard to predict, and technological stuff happen Okay, 192 00:11:04.320 --> 00:11:06.720 maybe over one year or two, but they come extremely 193 00:11:06.759 --> 00:11:11.559 fast and they tend to, you know, rebalance the cards. Now, 194 00:11:11.600 --> 00:11:15.559 in relation to your question, I'm going to make a 195 00:11:15.679 --> 00:11:20.960 Roman antiquity parallel. It's what I call the Joglethian tetuarchy. 196 00:11:22.200 --> 00:11:25.879 So in the Geoglythian TECHWARKI, you have the Augusti and 197 00:11:25.960 --> 00:11:30.080 the Cesarees. You have the two main thinkers, which I'm 198 00:11:30.200 --> 00:11:33.960 sure everybody know here. On one hand you've got vaclass 199 00:11:34.080 --> 00:11:37.720 Mill and on the other you've got Clayton Christensen. You 200 00:11:37.799 --> 00:11:42.399 have the Pope of the system. Are very rigid and 201 00:11:43.159 --> 00:11:46.320 you know, move very very slowly. And on the other 202 00:11:46.480 --> 00:11:49.559 you've got that wonderful man that we lost too soon, 203 00:11:49.639 --> 00:11:55.960 who is describe disruption, destruction, codact moments, the s curves, 204 00:11:56.399 --> 00:11:59.519 and of course you go down one notch to the Cesarees. 205 00:11:59.679 --> 00:12:03.559 So in the waclaf's milk column you have Danielle Jogin, 206 00:12:04.320 --> 00:12:07.720 which for me, when I read the prize thirty six 207 00:12:07.879 --> 00:12:12.320 years ago was an absolute revelation. He rewrites the whole 208 00:12:12.600 --> 00:12:16.120 twentieth century through the prism of oil and all the 209 00:12:16.200 --> 00:12:18.600 geopolitics links to oil. And I can tell you if 210 00:12:18.639 --> 00:12:21.440 you should read it, it's very eye opening and it's 211 00:12:21.440 --> 00:12:24.279 still alive. He is a very clever guy. He has 212 00:12:24.320 --> 00:12:27.559 not really updated his software for the past fifteen years, 213 00:12:27.559 --> 00:12:30.159 but besides that is a very respected guy. And of 214 00:12:30.240 --> 00:12:34.759 the other everybody knows him. Here it's Michael Libic who 215 00:12:34.799 --> 00:12:37.919 has taken the christen cent theory and put them to 216 00:12:38.080 --> 00:12:42.200 work on solar batteries, you know, and King's Mill is there, 217 00:12:42.240 --> 00:12:44.080 so it's kind of you know, it's the same school 218 00:12:44.120 --> 00:12:48.279 of thought. And of course, depending which cocktail you're going 219 00:12:48.360 --> 00:12:54.559 to take, of the smell jog In or the christensend Libriic. 220 00:12:55.279 --> 00:12:58.240 To answer to your question, the best way you look 221 00:12:58.320 --> 00:13:00.600 back fifteen years, because they've been in terms of the 222 00:13:00.600 --> 00:13:04.080 same thing all the time, I would say the Libash 223 00:13:04.159 --> 00:13:08.080 camp is seventy percent and the Yogin camp thirty percent. 224 00:13:08.600 --> 00:13:10.919 Just by the fact. So if you ask me, are 225 00:13:10.960 --> 00:13:15.279 we addition or transition, we are two thirds transition, one 226 00:13:15.320 --> 00:13:19.799 third edition, and we have geographical growth on one hand, 227 00:13:20.200 --> 00:13:23.679 and Eric Mitchik on the others, oil one hundred and 228 00:13:23.759 --> 00:13:25.840 one million. Barry, okay, we're going to go to one 229 00:13:25.879 --> 00:13:29.519 hundred and two, one hundred and three. You know that's 230 00:13:29.519 --> 00:13:31.399 not a growth sector. Let me listen. 231 00:13:31.559 --> 00:13:33.519 We'll go a bit deeper up to this point, because 232 00:13:33.799 --> 00:13:36.120 when you look at it globally, it is true that 233 00:13:36.159 --> 00:13:39.759 fossil fuels have kept on rising and still keep on rising, 234 00:13:39.960 --> 00:13:42.120 and we add on renewables on top. But I was 235 00:13:42.120 --> 00:13:44.840 in copenhageners two days ago, and when you look at 236 00:13:44.879 --> 00:13:49.360 Denmark's transition as a case study, just in the electricity sector, 237 00:13:49.440 --> 00:13:52.720 renewables are now something like close to ninety percent of 238 00:13:52.759 --> 00:13:57.360 electricity generation EV sales are what seventy percent or eighty 239 00:13:57.399 --> 00:14:01.240 percent now, So massive transformation. So once you start looking 240 00:14:01.240 --> 00:14:06.159 at the transition sectorially or regionally, the picture does change 241 00:14:06.320 --> 00:14:09.240 quite a bit. And we talked about this in preparation 242 00:14:09.360 --> 00:14:11.519 for this. You know, actually looking at things globally can 243 00:14:11.559 --> 00:14:14.720 be instructive because it tells you something about how fast 244 00:14:14.720 --> 00:14:18.159 we're going globally, but it doesn't tell you about all 245 00:14:18.200 --> 00:14:21.240 the innovation that's taking place in different parts of the world. 246 00:14:21.759 --> 00:14:24.360 It doesn't tell you actually where the solutions are where 247 00:14:24.360 --> 00:14:27.399 the problems are, and therefore I think it's a question 248 00:14:27.440 --> 00:14:28.000 that needs to. 249 00:14:27.919 --> 00:14:28.840 Be more nuanced. 250 00:14:29.039 --> 00:14:31.240 You know, we are in a transition in some parts, 251 00:14:31.679 --> 00:14:34.519 in some sectors, in some countries, but we're not yet 252 00:14:34.759 --> 00:14:38.799 in a transition globally everywhere, and that's going to take 253 00:14:38.840 --> 00:14:42.759 some time. But these things tend to come in transes, right, 254 00:14:42.799 --> 00:14:44.440 I mean, you may look at the deployment of other 255 00:14:44.480 --> 00:14:47.799 technologies that hasn't happened at the same speed everywhere, that 256 00:14:47.840 --> 00:14:52.000 has happened at different speeds in different times, in different places. 257 00:14:52.399 --> 00:14:55.039 And I think that will be my take on this question. 258 00:14:55.519 --> 00:14:58.039 Are we going fast enough? Of course we're not. Otherwise 259 00:14:58.080 --> 00:15:00.559 emissions would have come down and we would and see 260 00:15:01.000 --> 00:15:04.440 an increase in demand for fossil fuels. But to say 261 00:15:04.480 --> 00:15:06.480 that we're not in a transition, it's just an addition. 262 00:15:06.600 --> 00:15:08.440 I think it's too short sighted. That will be my 263 00:15:08.559 --> 00:15:11.600 take on the question. And it also then does not 264 00:15:11.720 --> 00:15:14.399 allow you to understand really where the barriers are and 265 00:15:14.440 --> 00:15:15.639 where the solutions are. 266 00:15:16.639 --> 00:15:19.559 What do you think about that law? Well, first of all, 267 00:15:19.919 --> 00:15:23.480 if it took electrification in our countries, which is like 268 00:15:23.759 --> 00:15:28.440 you know, we had flat electricity for twenty years so 269 00:15:28.720 --> 00:15:32.039 the electrical system has lost the muscle memory of growing. 270 00:15:33.200 --> 00:15:36.399 They are in America, you know, trying to get it back, 271 00:15:36.440 --> 00:15:40.440 and it's very, very painful because you don't have enough electricians, 272 00:15:40.519 --> 00:15:44.240 because connection to the grid last ten years, because you 273 00:15:44.399 --> 00:15:47.159 get your turbines in six years. Because people have become 274 00:15:47.399 --> 00:15:51.840 kind of comfortable in the zero growth universe, the electrification, 275 00:15:52.320 --> 00:15:56.440 it's the future. Whether you talk about better technology, whether 276 00:15:56.480 --> 00:15:59.440 you talk about redu seeing emission, whether you talk about 277 00:15:59.559 --> 00:16:02.159 would you see in fossil fuge, just give better product 278 00:16:02.200 --> 00:16:05.879 to people. So it's going to be evs. But in 279 00:16:05.879 --> 00:16:08.639 India is going to be cooling, and as here is 280 00:16:08.679 --> 00:16:11.600 going to be heating. You like your heat pumps and 281 00:16:11.679 --> 00:16:14.080 I love the heat pumps as well. And of course 282 00:16:14.120 --> 00:16:16.360 in America is going to be data center. I said, 283 00:16:16.360 --> 00:16:18.200 I was looking to a girl from Google as all 284 00:16:18.320 --> 00:16:21.519 this AI stuff, said no, no, no, we don't build 285 00:16:21.559 --> 00:16:24.600 that a center for AI. We build that as centers 286 00:16:24.679 --> 00:16:28.240 because of YouTube, because of autonomous vehicle are way more 287 00:16:28.639 --> 00:16:30.600 are just you know, need more and more data center. 288 00:16:30.720 --> 00:16:33.480 So eighty percent of the data centers who are building 289 00:16:33.799 --> 00:16:36.559 are not for AI. They're just for your run off 290 00:16:36.559 --> 00:16:39.799 the milk cloud. And then he told me, we had 291 00:16:39.840 --> 00:16:42.279 this big meeting at Google to see how we could 292 00:16:42.440 --> 00:16:46.960 spend our one hundred and eighty four billion dollar CAPEX 293 00:16:47.000 --> 00:16:49.440 investment this year on the ready eighty four. The first 294 00:16:49.440 --> 00:16:53.000 thing is say that's more than the military budget of Russia. 295 00:16:53.320 --> 00:16:56.919 Just Google, and then you know, the guys say, yeah, yeah, 296 00:16:56.960 --> 00:16:59.559 our budget of one at and I guess one eighty 297 00:16:59.600 --> 00:17:03.559 four for you. Four billion is a rounding error. So 298 00:17:04.000 --> 00:17:06.279 that gives you a bit of the magnitude of the 299 00:17:06.359 --> 00:17:09.119 amount of money that the eye per scatters. Are they 300 00:17:09.119 --> 00:17:11.599 going to make stupid things with them? One hundred percent, 301 00:17:11.759 --> 00:17:14.599 They're going to be crisis, They're going to be bankruptcy. 302 00:17:15.039 --> 00:17:18.200 But the digitization effort that's happening in the US, and 303 00:17:18.240 --> 00:17:21.200 that's going to come in shape or forming yourb This 304 00:17:21.240 --> 00:17:24.759 is great news because we finally going to see growth 305 00:17:25.200 --> 00:17:28.319 and a system with your growth where you know, it's 306 00:17:28.400 --> 00:17:30.799 like the same pizza you want the bigger size of pizza, 307 00:17:30.839 --> 00:17:33.720 you need to take it from somebody else. A system 308 00:17:33.799 --> 00:17:35.200 is much better. What is growing. 309 00:17:35.720 --> 00:17:38.440 We could discuss how USII is as a tool and 310 00:17:38.480 --> 00:17:41.599 whether that is good energy demand growth or not. But 311 00:17:41.680 --> 00:17:43.559 I think let's go into the next question, which is 312 00:17:43.599 --> 00:17:45.839 sort of connected. I think you mentioned the US already 313 00:17:45.839 --> 00:17:48.960 and the huge growth and data centers. The next cluster 314 00:17:49.000 --> 00:17:52.839 of questions really are around geopolitics and so industrial policy, 315 00:17:53.200 --> 00:17:57.000 the rise of China as a global superpower, and especially 316 00:17:57.039 --> 00:18:00.559 relevant of course in energy, the backlash against some of 317 00:18:00.599 --> 00:18:03.680 the clean energy policies in the US. I have the 318 00:18:03.759 --> 00:18:06.720 feeling that we are on the cusp of quite an 319 00:18:06.720 --> 00:18:10.599 interesting switch globally when it comes to energy where yep, 320 00:18:10.680 --> 00:18:12.559 still people talk a lot about the US, but when 321 00:18:12.880 --> 00:18:15.680 you look at investment figures all the time, Lauren, when 322 00:18:15.680 --> 00:18:17.839 you look at how much money gets invested in clean 323 00:18:17.960 --> 00:18:21.359 energy technologies, it's not the US that's top of the list, right, 324 00:18:21.480 --> 00:18:26.319 that's China. How is that shift affecting geopolitics when it 325 00:18:26.359 --> 00:18:30.720 comes to energy dependencies? You mentioned your early youth experience 326 00:18:30.799 --> 00:18:34.079 with oil and dependency and realizing the implications of that. 327 00:18:34.440 --> 00:18:36.599 How is all of that going to change in the 328 00:18:36.640 --> 00:18:39.279 next five years or ten years if you want to 329 00:18:39.279 --> 00:18:39.839 look ahead? 330 00:18:40.240 --> 00:18:42.519 Yeah, Look, it's all debate be was state versus a 331 00:18:42.720 --> 00:18:46.640 cross state and here Kingsmelia and you know are the 332 00:18:47.319 --> 00:18:50.319 real brain behind that. And of course it's all about 333 00:18:50.319 --> 00:18:52.640 industrial policy. Now. The first thing I want to say, 334 00:18:52.799 --> 00:18:56.920 is the moment you do ideology in energy, it costs 335 00:18:56.920 --> 00:19:02.240 a lot. Ideology costs a fortune. Gb decides that to 336 00:19:02.279 --> 00:19:05.880 go to coup. They want to be zero call okay, 337 00:19:06.000 --> 00:19:08.759 zero coal, regardless of the course of the system. Fine, 338 00:19:09.400 --> 00:19:12.440 so they're gonna tell drugs, okay, wonderful, you're going to 339 00:19:12.720 --> 00:19:16.480 switch to biomass, you're gonna get trees. They're going to 340 00:19:16.519 --> 00:19:18.480 be sustainable. Of course they're not. But at the end 341 00:19:18.519 --> 00:19:21.200 of the day, they give them ten billion pounds over 342 00:19:21.240 --> 00:19:26.079 ten years, ten billion pounds just for the ideological purity 343 00:19:26.200 --> 00:19:29.200 of saying we don't burn coal anymore. The Germans they're 344 00:19:29.200 --> 00:19:32.960 going to close six well functioning nuclear plants just because 345 00:19:33.319 --> 00:19:37.400 it's ideology. In the US, they're waging a war against 346 00:19:37.440 --> 00:19:42.279 offshore wind just for ideological reason. So every time you 347 00:19:42.319 --> 00:19:45.240 want to do ideology, good, but come with your checkbook. 348 00:19:46.000 --> 00:19:48.000 That's the first thing I'd like to say. What was 349 00:19:48.039 --> 00:19:51.599 your question again? Yeah you apologize? Yeah, okay. So some 350 00:19:51.640 --> 00:19:55.079 people say, yeah, the answer is, we need to produce 351 00:19:55.200 --> 00:19:58.839 everything here. We need to have a no tarctic philosophy, 352 00:19:59.119 --> 00:20:02.680 building our sta panels. And because the Chinese are so 353 00:20:02.759 --> 00:20:05.799 aw full, now please, you're going to take please your iPhone, 354 00:20:05.799 --> 00:20:07.839 and you're going to break your iPhones because ninety percent 355 00:20:07.920 --> 00:20:11.200 of them are done in China, which apparently causes your problem. 356 00:20:11.720 --> 00:20:14.200 What I would say is you still need to have 357 00:20:14.240 --> 00:20:16.039 an industry, a STRATEGI, but you need to have a 358 00:20:16.160 --> 00:20:19.559 smart one. So you need to take that old electro 359 00:20:19.680 --> 00:20:22.519 tech and figure out which one accommodity ties and you 360 00:20:22.559 --> 00:20:25.920 don't really just just buy it and which part are 361 00:20:25.920 --> 00:20:29.559 really strategic and double down the investment. So don't do 362 00:20:29.599 --> 00:20:32.519 a kind of sprinkling blanket. We're going to support all 363 00:20:32.519 --> 00:20:35.480 these things a very target, and so put the list 364 00:20:35.519 --> 00:20:36.319 together here. 365 00:20:36.720 --> 00:20:38.680 I mean, there's a fundamental difference, isn't it. If you 366 00:20:38.720 --> 00:20:41.640 have a renewable space system, for example, you have to 367 00:20:41.720 --> 00:20:45.599 import the technology maybe from China, right solar panels, so 368 00:20:45.680 --> 00:20:47.960 then once they installed, you don't need to have a 369 00:20:48.000 --> 00:20:50.759 fuel in order to operate them, Whereas if you operate 370 00:20:50.799 --> 00:20:53.279 a gas via power station, you need to have a 371 00:20:53.319 --> 00:20:56.680 fuel to keep that running. So they're fundamentally different technologies 372 00:20:56.720 --> 00:20:59.240 in that way. So the dependency is quite a different one, 373 00:20:59.279 --> 00:20:59.720 isn't it. 374 00:21:00.079 --> 00:21:02.839 Yeah. Yeah, But every expert, and I trust the experts 375 00:21:02.880 --> 00:21:07.359 will tell you we'll go to seventy eighty percent of 376 00:21:07.440 --> 00:21:10.759 vulnerable predication. With the technology we have and kind of 377 00:21:10.799 --> 00:21:13.519 the system we have, you want to do ideology, you 378 00:21:13.559 --> 00:21:17.200 want to net zero it or zero zero, it's going 379 00:21:17.279 --> 00:21:20.880 to cost an absolute fortune. So it makes economic sense 380 00:21:20.920 --> 00:21:24.359 for everybody's build to keep probably the twenty percent of 381 00:21:24.400 --> 00:21:27.160 facili fuel on the system. And that's a more intelligent 382 00:21:27.240 --> 00:21:30.720 debate than to say that zero zero zero zero. That's 383 00:21:30.759 --> 00:21:33.680 the end of it. Now, going back to the technologies, 384 00:21:34.000 --> 00:21:37.319 some of those technology, it's fine. Led the Chinese build 385 00:21:37.319 --> 00:21:41.160 them Los solar panels, it's fine. Now if you look 386 00:21:41.200 --> 00:21:45.000 at battery cells, there's been some joint venture. They're going 387 00:21:45.079 --> 00:21:48.640 to be built in Portugal, in Spain, in Poland. Once 388 00:21:48.720 --> 00:21:51.640 those plants are there and people kind of know how 389 00:21:51.680 --> 00:21:55.000 to do some good leftky batteries, great, then you can 390 00:21:55.079 --> 00:21:58.559 put some protective measures because we have build the industry. 391 00:21:58.880 --> 00:22:02.119 So when first were building screed, then we protected. And 392 00:22:02.160 --> 00:22:06.880 then there are other things like HVDC, cable switch gears, 393 00:22:07.039 --> 00:22:11.400 power electronics, key material processing that needs to be here 394 00:22:11.480 --> 00:22:15.400 at home, and others. Okay, fine, well import it. They're 395 00:22:15.480 --> 00:22:18.599 cheap and in fact, nobody's making money. If you're shoulder 396 00:22:18.640 --> 00:22:22.119 of long Gioginko, if you made ther many so you 397 00:22:22.200 --> 00:22:24.960 need to be selective. There are things which are critical 398 00:22:25.039 --> 00:22:26.839 and we need to protect them and invest in them, 399 00:22:26.920 --> 00:22:28.599 and others that are useless. 400 00:22:29.079 --> 00:22:31.200 There is now sort of initiative at least in the 401 00:22:31.240 --> 00:22:34.599