Speaker 1: You are listening to Redefining Energy.
Speaker 2: Your co hosts from Berlin Gerard Reave and from London Lauren.
Speaker 1: Sag Today on Redefining Energy, We're going to talk about
Speaker 1: connecting North America and Europe with a very long power
Speaker 1: cable and to do that, I've got my two partners
Speaker 1: in this venture, Lauren and Simon on a call, So
Speaker 1: let's go.
Speaker 3: The idea originally came in October twenty two after the
Speaker 3: pipelines were blown up and all Ukraine situations, and that
Speaker 3: showed that you can only rely on allies for our
Speaker 3: energy security. But of course the idea of a cable
Speaker 3: across the Atlantic, although it has been done with the
Speaker 3: telegraph in eighteen sixty six and we've got dozens of
Speaker 3: Internet cable but the question was is it technically possible.
Speaker 3: That's the first ques and the answers is provided by
Speaker 3: the CEO of National Grid, John Pettigol on interview he
Speaker 3: gave six months ago on the podcast, and so that
Speaker 3: you know, National Grid is the largest operator in the
Speaker 3: world of subscinta connector. So if there is one person
Speaker 3: on this planet who knows something about long distance cable,
Speaker 3: that's John Pettigle. Let's listen to the interview.
Speaker 4: Another area of National Grids business in the ventures, which
Speaker 4: is your interconnectors. It's actually pretty large part of your activity.
Speaker 4: I think I saw a quite cool photo of you
Speaker 4: being handed the Guinness World Record for the longest power
Speaker 4: cable in the world for your Viking protect That must
Speaker 4: have been an exciting day, John.
Speaker 5: Yeah, it's fantastic. Actually, I guess most people don't realize,
Speaker 5: but naturally don't. Six interconnectors now with France, the Netherlands, Belgium,
Speaker 5: Norway and the latest one is Denmark and it is
Speaker 5: the longest subse land HBDC cable in the world. We
Speaker 5: got the in the Guinness Book records for that. But
Speaker 5: Nash Grid with the largest owner in the world of
Speaker 5: subc cables now. So it is a significant and important
Speaker 5: part of our business and directly linked into our views
Speaker 5: on the energy transition. So increasingly we think networks across
Speaker 5: Europe will need to be interconnected, particularly to take advantage
Speaker 5: of the offshore wind resource we got in the North Sea.
Speaker 5: So to date, you know, we've been investing what we
Speaker 5: call point to points into connectors, but we do see
Speaker 5: it as the start or what ultimately will become an
Speaker 5: offshore grid. So it's an important part of our business.
Speaker 5: And when we're very proud.
Speaker 4: Of with these interonnectors, and you've already got the record
Speaker 4: for the longest subse cable, but in my mind I
Speaker 4: always wonder how far could we go with this? Both
Speaker 4: well many from a technical perspective. I mean there's been
Speaker 4: discussion of having solar projects in North Africa link into
Speaker 4: the UK or even into Germany. There's been discussion even
Speaker 4: of a could we have an interconnector across the Atlantic?
Speaker 4: What is the physical limit that you think to one
Speaker 4: of these long cables.
Speaker 5: You're right, a lot of work is being done and
Speaker 5: if you sort of separate the sort of engineering feasibility
Speaker 5: from the economics feasibility, there is no doubt from an
Speaker 5: engineering perspective you could connect Morocco which is the exce
Speaker 5: Links project to southern England with a large interconnector. From
Speaker 5: an engineering perspective, I think people have got themselves comfortable
Speaker 5: that is something that's achievable.
Speaker 3: Would you want to say something about John Bittig or Simon. Yeah.
Speaker 6: At National Grid are clearly the leaders in developing, executing
Speaker 6: and operating subsey cables, and as a whole, Great Britain
Speaker 6: is really leading the way and will continue to do
Speaker 6: so for some years to come. As an island, we're
Speaker 6: heavily dependent on both importing and exporting electricity as a
Speaker 6: great trading nation. But I think also looking forward, as
Speaker 6: we fill and all sea and other shallow basins around
Speaker 6: the world with wind farms and cover our fields with solar,
Speaker 6: we need to think after twenty thirty, after twenty forty,
Speaker 6: what are we going to do. We're talking already about
Speaker 6: dunka flouters and other problems that we foresee having concentration
Speaker 6: of renewable volatile power. So the logical next step is
Speaker 6: to connect uncorrelated solar and win basins around the world
Speaker 6: to mitigate that risk. And I think that's where North
Speaker 6: Atlantic Transmission one comes into the four.
Speaker 1: Let me jump in there and just say, really tople
Speaker 1: up simple English. When it's sunny here, it's dark in
Speaker 1: North America. When it's windy there, it's not windy here.
Speaker 1: And we've looked back over weather data over the last
Speaker 1: twenty years and we see zero correlation. And that makes
Speaker 1: it really, really really interesting.
Speaker 3: Yeah, So to explain where we're at right now. I
Speaker 3: gave an interview in February to another podcast called Joel,
Speaker 3: So there's a lot of circular academy. You know, I reuse,
Speaker 3: I reuse a lot. But it was a very good interview.
Speaker 3: So rather than repeating, we're gonna listen to myself talking
Speaker 3: too jorts.
Speaker 7: Hello everybody, and welcome back to the Jolt. I'm your host,
Speaker 7: Sam Morgan. Imagine this, if you will, a huge power
Speaker 7: cable link in North America and Europe, electricity firing off
Speaker 7: in both directions to make the most of renewable energy
Speaker 7: when it can be generated and when it can be consumed.
Speaker 7: Sounds fanciful, right Well, on today's episode, I'm looking into
Speaker 7: why this idea could be a win wind for both
Speaker 7: sides of the Atlantic, and how the project might actually
Speaker 7: be realized. A couple of nights ago, I was working
Speaker 7: up by my shutters banging against the window frame thanks
Speaker 7: to some particularly strong winds in the early hours of
Speaker 7: the morning. That got me thinking, as I lay there
Speaker 7: trying to get back to sleep, isn't it a shame
Speaker 7: that all of that wind is pretty much going to
Speaker 7: waste as during the night there isn't much demand for electricity.
Speaker 7: We can only store so much of it, so a
Speaker 7: lot of potential green electrons go to waste. Today, though,
Speaker 7: we are taking a look at an ambitious power project
Speaker 7: idea that could solve that problem. Well if you could
Speaker 7: power a different part of the world where energy demand
Speaker 7: matches renewable energy supply patterns. If you laid a power
Speaker 7: cable from Europe to North America, for example, then you
Speaker 7: could do just that. Nighttime winds in the North Sea
Speaker 7: could power evening demands across the pond, while North American
Speaker 7: electrons could satisfy Europe's morning peak. That cable would of
Speaker 7: course be the longest ever installed and would pose a
Speaker 7: mighty infrastructure challenge, but that has not stopped some of
Speaker 7: the brightest minds in the business from trying to turn
Speaker 7: this from great idea to fantastic reality. I'm lucky enough
Speaker 7: to be joined today by one of the pioneers behind
Speaker 7: this project to learn a bit more about the logic
Speaker 7: behind the idea, the challenges it faces, and why those
Speaker 7: in power should give it a chance. Laurent Segela is
Speaker 7: a clean energy banker with decades of experience in this sector,
Speaker 7: whose latest venture, megawatt X, is behind the NATO l
Speaker 7: power cable plan. I kicked off my conversation with Lauren
Speaker 7: by asking him to go a little bit more into
Speaker 7: why building a transatlantic power link is a good idea.
Speaker 3: The genesis came when the North Stream system blew up
Speaker 3: two and a half years ago, So that was really
Speaker 3: a bit of what they call a Sputnik moment where
Speaker 3: you operalize that you cannot rely on Russia for their
Speaker 3: energy needs. I think Canada has experimented seeing a similar
Speaker 3: issue with what's going on with the Trump administration. First
Speaker 3: question you need to ask yourself is why when you
Speaker 3: do inter collector? Is why do you do inter connector? Because,
Speaker 3: as you said, the Custo lot have a changing problem
Speaker 3: and at the end of the day, the fundamentals are
Speaker 3: number one, security, Number two, we have a growth in
Speaker 3: power demand, data centers, transportation, heating. But who sees that
Speaker 3: the grid is becoming more and more intermedtent And because
Speaker 3: I developed an interconnector previously a new one which is
Speaker 3: going to link Dublin and Liverpool, I had a bit
Speaker 3: of an understanding on how to develop an interconnector. And
Speaker 3: then you ask the question about the economics, Well, for me,
Speaker 3: it's really about wind. We're gonna rely more and more
Speaker 3: on the North Sea and it's a great success. But
Speaker 3: as a lot of people may know, when is intermedent
Speaker 3: in the NORSEA, maybe you get a forty to fifty
Speaker 3: percent of capacity factor, but as pretty much it so
Speaker 3: we've developed a lot of interconnectors in your hope, but
Speaker 3: sometimes when it's blowing in the North Sea, you know
Speaker 3: it's blowing in England and in Denmark or in Belgium
Speaker 3: at the same time. The balancing of the Nasia resource
Speaker 3: is not that obvious now if you look on the
Speaker 3: other side, and it's very important that an interconnector makes
Speaker 3: sense for the boss country that they connect Canada and
Speaker 3: especially Quebec as a very different grid. Quebec is a
Speaker 3: bit Norway on steroids in the sense that they have
Speaker 3: an extraordinary amount of hyrol but they are very mindful
Speaker 3: of how to use those resources. They are exporting quite
Speaker 3: a lot to the US, which is always difficult. And
Speaker 3: what you realized is that with six hours of the
Speaker 3: radiation of the Earth, in fact the peak demand which
Speaker 3: are seven am to nine am and four pm to
Speaker 3: nine pm, are not aligned. Basically, it's the full night
Speaker 3: in Europe when it's the peak in Canada and when
Speaker 3: it's our morning peak, it's night over there. And the
Speaker 3: team we've run a lot of analysis and this has
Speaker 3: also been supported by a study by Amber and Energy,
Speaker 3: meaning that it makes a lot of sense from a
Speaker 3: Greek perspective to combine in a certain way the two grids.
Speaker 7: What kind of role could this project actually play in
Speaker 7: both Europe's and North America energy transitions?
Speaker 6: Then?
Speaker 7: Could it be a fundamental cog in Europe's decarbonization mission
Speaker 7: or is it potential a little more nuanced than that.
Speaker 3: Well, our plan is to develop three interconnectors of two
Speaker 3: giga what each, So in the grand scheme of things
Speaker 3: they want to put one hundred gig in the North Sea.
Speaker 3: It's not going to move the needle a lot. What
Speaker 3: it will allow is in pairs of stress, whether here
Speaker 3: or over there, it will cap the price because you
Speaker 3: will be able to get power pilow one hundred you
Speaker 3: op omega what hour. Otherwise you will need to fire
Speaker 3: some very expensive CCGT and polluting CECILGT or running more coal.
Speaker 3: And if you consider that the batteries which are great,
Speaker 3: but the battery is mostly going to cover two or
Speaker 3: three hours in terms of intense stress. In terms of
Speaker 3: the call floater a big interconnectois is an extraordinary diversification.
Speaker 3: So it's not going to change fundamentally, but it's going
Speaker 3: to create a lot of resiliency on the margin.
Speaker 7: Now, obviously, linking two continents that are separated by one
Speaker 7: of the world's largest and deepest bodies of water is
Speaker 7: no walk in the park. It poses an immense engineering
Speaker 7: challenge and if the project were completed, it will rank
Speaker 7: among some of humanity's most impressive achievements. But are we
Speaker 7: overreaching slightly here or could this actually be done? Lauren
Speaker 7: explains here why the answer is yes, we can.
Speaker 3: The idea came on the back of the project of
Speaker 3: the sun Cable wants to link Australia to Singapore and
Speaker 3: also exce links who want to link more code to
Speaker 3: UK or Germany. So it means it that been worked
Speaker 3: already by excellent professionals. The biggest link right now is
Speaker 3: the Viking Link hate hundred kilometer, so we need to okay,
Speaker 3: let's say times five. But you know, if you look
Speaker 3: at a lot of investment which has been made in
Speaker 3: a transition where there is some nice discovering the lab
Speaker 3: and people needs to want times one hundred. I would
Speaker 3: say times five is very reasonable. Now, if you look
Speaker 3: at the supply chain, it exists on supply chain, it's
Speaker 3: called it. Tacchi. Ge Acker National Grid already managers six interconnectors.
Speaker 3: So we have talked to those people and they all said, look, yeah,
Speaker 3: it's long, it's deep, it's challenging, but yeah, with just
Speaker 3: one generation away, So there was no technical red flag.
Speaker 3: In terms of technology.
Speaker 7: Interconnectors have been in the news a fair bit lately.
Speaker 7: Lauren already mentioned nord Stream too earlier in the show.
Speaker 7: Power cables in the Baltic have been damaged and in
Speaker 7: all likelihood targeted. It's even prompted NATO to launch a
Speaker 7: special mission to protect this vital infrastructure. So I asked Lauren,
Speaker 7: is there a danger that governments will actually go in
Speaker 7: the opposite direction and turn their noses up at more interconnectors,
Speaker 7: risking that Transatlantic idea never being given an actual fair hearing.
Speaker 3: Well, I say you and retract. But at the end
Speaker 3: of the day, this is a very long term project.
Speaker 3: If you only think defense, you never do the Panama Canal,
Speaker 3: you never do the Swiss Canal. Some people like to
Speaker 3: build walls and others like to build bridges, so we
Speaker 3: must be optimistic. And the fact that the wind doesn't
Speaker 3: blow at the same time on both sides of the Atlantic,
Speaker 3: and we're going to rely on clean power that makes
Speaker 3: it interesting. We need to deliver positive messages. Now there's
Speaker 3: going to be a lot of work to be done.
Speaker 3: From a technical point of view, how do you lay
Speaker 3: cable that deep? We're going to need to use new
Speaker 3: technologies because right now we're using mostly one a thousand voults.
Speaker 3: We need to go to one million involved, but you
Speaker 3: know Chinese they already use one million involved. We need
Speaker 3: to choose the route call Arctic Root, Northern rout, Southern rout.
Speaker 3: We need to know where we're going to land, but
Speaker 3: we have identified landing zones. And then, as you said,
Speaker 3: a lot of discussion around regulation permitting financial models. But
Speaker 3: look in terms of a footprint, the size of the cable,
Speaker 3: it's just a it's a big pizza, so I mean,
Speaker 3: it's not that big.
Speaker 7: You know. When I first read about this project, my
Speaker 7: first reaction was fascination. I am, after all, a little
Speaker 7: boy at heart who will always be enthralled by big bridges.
Speaker 7: Giant ships and tour skyscrapers. But what are the reactions
Speaker 7: of other people been, especially those that might be able
Speaker 7: to help get this project off the ground.
Speaker 3: At the beginning, everybody was kind of got smacked. But
Speaker 3: you know, the more you think about it, we have
Speaker 3: the supply chain, we have the tools. They are strong
Speaker 3: economic rational, they are strong security irrational from both sides. Now,
Speaker 3: it's going to take maybe ten years. But when I
Speaker 3: had first the idea and I googled, I saw nobody's
Speaker 3: doing it. So I said, look, maybe I'm a bit foolish,
Speaker 3: but I'm going to start. And thanks God, I've got
Speaker 3: your hard read and Simon Ludnam as a co partners,
Speaker 3: and each of them brings enormous level of contacts and knowledge.
Speaker 3: And you know, we know how to price those interconnectors.
Speaker 3: We understand the regulation that needs to be changed. It's
Speaker 3: a very long journey. I'm sure over time those cables
Speaker 3: will exist because they make so much sense for post parties.
Speaker 7: I think today's episode is a great reminder, in my
Speaker 7: point of view, at least, that there is room in
Speaker 7: the energy transition, maybe even a need to think big.
Speaker 7: Why shouldn't north sea wind power quebecuar homes. Why shouldn't
Speaker 7: Portuguese solar fuel finish sawners. We have the technology to
Speaker 7: pull much of this off, so big ideas like the
Speaker 7: one being developed by Lauren deserve to be heard.
Speaker 3: Now part of our process, we have engaged with the
Speaker 3: best of the best in the world. And when it
Speaker 3: comes to HVDC technology and the capacity to build long
Speaker 3: cable there is one expert that everybody knows and everybody respect.
Speaker 3: It's Connell Display, global head of HVDC at DNV. Let's
Speaker 3: hear read directly from him. Hi, cornelis how are you
Speaker 3: doing so? Conneis your global head of HVDC at DNV.
Speaker 3: So you know a thing or two about subsynta connectors
Speaker 3: and you recently published a very technical document where you
Speaker 3: analyze what you now call the ultra long subse cables.
Speaker 3: So what are the main conclusions?
Speaker 8: Thanks for the opportunity to come onto your show. We've
Speaker 8: been really interested in how far you can go with HIDC.
Speaker 8: We've always been saying that you can go as far
Speaker 8: as practically relevant with HIDC, but we always assumed that
Speaker 8: this was using overheadlines and we just wanted to know
Speaker 8: it's the same truth for underground and submarine cables, because
Speaker 8: we see many projects being proposed these days with lengths
Speaker 8: over one thousand kilometers, sometimes several thousands of kilometers. So
Speaker 8: what we did is we there's been very simple linear
Speaker 8: analysis looking at some basic aspects of those systems to say, hey,
Speaker 8: do we at some distance, at some transmission length start
Speaker 8: running into real fundamental issues run So we looked at
Speaker 8: the impact on the system designed. For example, we looked
Speaker 8: at the impact on the losses in the system, the availability,
Speaker 8: the ability to test the cable after it's been installed,
Speaker 8: and also how long it would take to actually manufacture
Speaker 8: this cable. And from the analysis that the bottom line
Speaker 8: conclusion is we don't see any significant red flags for
Speaker 8: the first few thousand kilometers. I've also discussed this with
Speaker 8: a few of the other participants at the conference that
Speaker 8: I was at last week. There were manufacturers there also
Speaker 8: some utilities and the converted manufacturers that I spoke to.
Speaker 8: They all seem to agree that we do not see
Speaker 8: any real technical limits for those few first thousands of kilometers.
Speaker 8: So one could say from that perspective it is technically feasible.
Speaker 3: So in fact, those subsey cables if you are from
Speaker 3: a public policy, you know, long term strategy. You've got
Speaker 3: guys coming with the fusion energ or hydrogen I don't
Speaker 3: know what ortorium reactors, which frankly don't exist here. What
Speaker 3: you're saying is with what we have today and can
Speaker 3: get better in the next ten years, and the supply
Speaker 3: chain that exists with guys like Prismian and Kat and
Speaker 3: the Semens, the Itashi, the g of this world. Those
Speaker 3: people just saying like, wow, it's long, it deep, it
Speaker 3: subtenly tough, but yeah.
Speaker 8: For sure challenging, but not impossible.
Speaker 3: Right.
Speaker 8: The challenge will be in controlling the quality of the
Speaker 8: cable so you can control the failure rate, which of
Speaker 8: course is just a statistic really, but it's a very
Speaker 8: important one. When the cable length starts becoming ultralong more
Speaker 8: than a thousand kilometers, that's something that we don't have
Speaker 8: a lot of experience with today in the industry, where
Speaker 8: we have based our technology qualification on the assumption that
Speaker 8: we have much shorter lengths. So we have to really
Speaker 8: think about how do we prove that our production processes
Speaker 8: are really controlled to the degree that you need to
Speaker 8: control them to have as low as possible filureate to
Speaker 8: make sure that those cables are in operation for long
Speaker 8: enough every year that the business case still is a positive.
Speaker 3: One in the end.
Speaker 8: That's one thing, but that's an engineering and a manufacturing
Speaker 8: problem that we can overcome. The other one is, of
Speaker 8: course the production capacity. The production of submarine cables is
Speaker 8: not a very fast process, so we will need more
Speaker 8: than several production lines to do that. Again, that's something
Speaker 8: that the industry is at the moment, not yet in
Speaker 8: a situation where we have that much production capacity that
Speaker 8: we can do this, but that's again a matter of
Speaker 8: engineering and investment in additional production capacity to make that happen,
Speaker 8: which if the business case is there, can be done.
Speaker 3: So right now in your hope, we have this standout
Speaker 3: called the too gigawatt TENET or the to giga at
Speaker 3: National Grid. Do you see evolution, because this has been
Speaker 3: a long journey to go from those first two undred
Speaker 3: megawat cables to now the two gigaward, which is really phenomenal,
Speaker 3: But the story continues, for sure.
Speaker 8: The industry will probably first want to see to get
Speaker 8: some operational experience with this new voltage level that is
Speaker 8: associated with the standard five hundred and twenty five thousand volts.
Speaker 8: But in the meantime we can already see that manufacturers
Speaker 8: are developing products for higher voltages six hundred and forty
Speaker 8: kilo votes for example, which with a submarine cable would
Speaker 8: probably enable.
Speaker 3: You to have a free gigawat link.
Speaker 8: That will be the next step. And also if you're
Speaker 8: going for alpha long cables, going to a higher voltage
Speaker 8: as benefits for the system design, it all make it easier,
Speaker 8: like a million voltes. That will be a future picture.
Speaker 3: We have that for overhead lines.
Speaker 8: Of course, time will tell if we can also do
Speaker 8: that for insulated cables. In my understanding that the highest
Speaker 8: voltage that has been developed today is one hundred thousand
Speaker 8: holds for underground cable, but that has never really seen
Speaker 8: a practical application yet. So amiliar voters were now probably
Speaker 8: still a bit of a dream, but why not.
Speaker 3: I understand the cable can be as big as three
Speaker 3: giga award, but you know that grid integration is an issue,
Speaker 3: and you might have grids who are a bit reluctant
Speaker 3: to have a single point of failure of three gigawats,
Speaker 3: and maybe they're going to go for two giga awards. Now,
Speaker 3: when we have designed the North Atlantic transmission, one link,
Speaker 3: we put six, so six is three times two or
Speaker 3: two times three. At the end of the day, it's
Speaker 3: up to the regulators, grid manager and the industrial supply
Speaker 3: chain to decide which is the best options. So we're
Speaker 3: open minded, will follow what the industry and the sides.
Speaker 8: And even if you have three times too, there's another
Speaker 8: trick that you could apply from a system design perspective,
Speaker 8: which is a so called metallic return. Typically it is
Speaker 8: way too expensive to do that with such a long
Speaker 8: link if it's just one time too, but if you
Speaker 8: have pre links, you might be able to share such
Speaker 8: a metallic return between the pre links and that can
Speaker 8: cut the two gigawads into two times one gigawads in
Speaker 8: terms of maximum lots of Infeed, depending on how utilities
Speaker 8: model the contingencies, that could provide a path forward to
Speaker 8: smooth that the grid integration of those kind of systems.
Speaker 3: Well comedies, Thank you so much. It was brief, but
Speaker 3: it was dence and it was very useful. And the
Speaker 3: general message is thanks to the engineers and the supply
Speaker 3: chain and all the hard work you're doing. There is
Speaker 3: no red flag in terms of developing those ultralong cable
Speaker 3: Thank you so much for coming on the show. Thank
Speaker 3: you ever.
Speaker 6: Yeah, just echoing some of Canelis's thought and looking forward. Clearly,
Speaker 6: we're not going to build this tomorrow, but we're going
Speaker 6: to build this for twenty forty and the products and
Speaker 6: services that are being used or implemented today will clearly
Speaker 6: developer time. And we're already speaking to the OEMs that
Speaker 6: they themselves are thinking what does their future look like,
Speaker 6: what do their future markets look like? And clearly looking forward,
Speaker 6: we can see that longline interconnectors or longline transmission cables
Speaker 6: will be a substantial part of the cable market in
Speaker 6: the future. This means we need to address the challenges
Speaker 6: of depth and losses, and the new products that the
Speaker 6: big OEMs are developing will look to reduce losses that
Speaker 6: could be done by working at much substantially high voltages.
Speaker 6: And we've already seen that in Asia and new boats
Speaker 6: being developed that can position cables subsed at three thousand meters,
Speaker 6: and we're already beginning to see that in some places
Speaker 6: in the Mediterranean. So I'm very hopeful that the market
Speaker 6: will move with us to developing the products and services
Speaker 6: we're going to need to implement this project.
Speaker 1: So the other thing is really important when it comes
Speaker 1: to interconnectors is the legal basis, because at the end
Speaker 1: of the day, you're connecting two or more countries together.
Speaker 1: So what we've done is teamed up at one of
Speaker 1: the best lawyers in the world in this area and
Speaker 1: is a Silka Goldberg. Let's hear what she has to say.
Speaker 3: Ske thank you so much for jumping in.
Speaker 2: Thank you very much for having me.
Speaker 3: Silka, I just want to discuss very rapidly because you're
Speaker 3: one of the most knowledgible lawyer when it comes to interconnector.
Speaker 3: Can you discuss a bit what you've done.
Speaker 2: Sure. First of all, I have to say I find
Speaker 2: interconnectors fascinating because they have the ability to bring electricity
Speaker 2: markets together in a way and sort of drive integration
Speaker 2: and sort of lower power prices. So I've always been
Speaker 2: fascinated by them. I have worked on probably eight interconnectors
Speaker 2: in total across the entire development cycle. For some I've
Speaker 2: worked very initially on the scoping on how does this
Speaker 2: project look like? For others, I've done trading arrangements. For others,
Speaker 2: we've looked as a firm at the EPC contracts and
Speaker 2: the strategy for it, and for others we've looked at
Speaker 2: the financing. The last one is worth mentioning for noy
Speaker 2: connect let on the financing of the non connect interconnected
Speaker 2: between GB and Germany. In addition, I've also worked on
Speaker 2: ato so offshore transmission cables and interconnectors outside of GB
Speaker 2: around the world.
Speaker 3: So just for our listener, Silk, she know what's talking
Speaker 3: about and she has very kindly accepted to look into
Speaker 3: the legal challenges in relation to the development of the
Speaker 3: Transatlantic cable. So, sil K, what's going to be new?
Speaker 3: What can be used from existing practices? So how do
Speaker 3: you see the legal picture?
Speaker 2: Thank you Lare. There are some things which will be
Speaker 2: just like any other interconnector. You will need to have
Speaker 2: a great connection at both ends of the cable, subject
Speaker 2: to the terms that the system operators will give you
Speaker 2: in both jurisdictions. You will need to have planning permission. Also,
Speaker 2: nothing new is like any other project, so there's a
Speaker 2: very well shrodden path. We know how that works in
Speaker 2: the UK, we know how that works in Canada. In
Speaker 2: anywhere else where you might want to make landfall, you
Speaker 2: will need to have an interconnector license in the UK,
Speaker 2: you will need to have the relevant authorization for an
Speaker 2: economic license in Canada, and again anywhere where you make landfall,
Speaker 2: you will need to have what is the exact root
Speaker 2: of your cable. And this is where it starts to
Speaker 2: get really interesting because at the same time this is
Speaker 2: very well established. We know how to do surveys for
Speaker 2: these cables from many other interconnectors, but the sheer, size
Speaker 2: and length of your cable will really be different, and
Speaker 2: so we'll probably have new geographical challenges or topological challenges
Speaker 2: which you will need to address. But there are other
Speaker 2: professionals in that area who can advise you better. Just
Speaker 2: from a legal perspective, this is ultimately just a survey contract.
Speaker 2: You might need to get special ships and under like
Speaker 2: environmental matters, so an environmental impact assessment. Then you also
Speaker 2: need to look at the same at the other end,
Speaker 2: so a lot of it is really really well trodden ground.
Speaker 2: The really big difference is size and scale and also
Speaker 2: as a result the regulatory status. In gb for instance,
Speaker 2: we have an exempt status for interconnectors sort of under
Speaker 2: certain circumstances, and we have a regulated status for interconnectors
Speaker 2: and the cup and sort of which is the cup
Speaker 2: and floor regime, which has been very well established. We
Speaker 2: need to establish really what of the two regimes is
Speaker 2: most suitable. And because it will only ever go, let's
Speaker 2: face it, until the end of the eest the exclusive
Speaker 2: economic zone for Great Britain, we need to look what
Speaker 2: does the regulatory regime look at at the other end
Speaker 2: of the cable and what really happens in an area
Speaker 2: where there is no e set any longer, and how
Speaker 2: is that cable really regulated at that point? And that
Speaker 2: is really new, so we don't know because it hasn't
Speaker 2: been done before. So we need to do some legal
Speaker 2: work around that and sort of speak to all the
Speaker 2: regulators involved and establish a unique regulatory regime to make
Speaker 2: sure the cable has an appropriate economic framework.
Speaker 3: Yes, but they already internet cables in the ocean, so
Speaker 3: I guess there are elements of the internet cable that
Speaker 3: can also be used for the power cable.
Speaker 2: Some elements for sure. So for instance, there is the
Speaker 2: United Nations Law of the c Young Class and in
Speaker 2: particular Article seventy nine actually talks about submarine cables and
Speaker 2: pipelines on the continental shelf. So we do have therefore
Speaker 2: some elements of a legal framework. But internet cables are
Speaker 2: also gas pipelines or oil pipelines that might be very
Speaker 2: far and might cross the E set or be indeed
Speaker 2: outside the E set of several states. They have some similarities,
Speaker 2: but they don't have quite the same regulatory needs as
Speaker 2: electricity cables. So yes, there's young class. There is sort
Speaker 2: of I would call it a legal scaffolding around it,
Speaker 2: but we need to work with the regulators and make
Speaker 2: sure that we adapt it as is needed for the
Speaker 2: cable Well.
Speaker 3: Sir, thank you very much. The great things working with
Speaker 3: you is that I absolutely don't have the answers, I
Speaker 3: may not even have the questions, but I know I
Speaker 3: can rely on extraordinary professionals like you to push this
Speaker 3: project forward. Thank you very much for coming on the show.
Speaker 3: Thank you so through all those interviews, John Pettigrew, Corneli Split,
Speaker 3: Salca Goldberg, we have people who have inspired us or
Speaker 3: help us, and so far we've done it on our
Speaker 3: own time and budget. But we believe now we reach
Speaker 3: a moment where it starts to crystallize around energy security,
Speaker 3: around resiliency, around strategic partnership between our lies. We have
Speaker 3: received sufficient green lights, especially in our conversation unfortunately on
Speaker 3: our NDA, so we can't really tell more, but with
Speaker 3: very senior people on both sides of the Atlantic, and
Speaker 3: it's time for this project to move into the next phase,
Speaker 3: which is raising money and developing the real technical visibility studies. Simon,
Speaker 3: do you want to say something about how we're going
Speaker 3: to develop the next two or three years?
Speaker 6: Yeah, if you've got this far listening to the podcast,
Speaker 6: you'll know from all the experts that have come before
Speaker 6: us is that to connect us a very broad in scope.
Speaker 6: They create many independencies and they're clearly multiplied by the
Speaker 6: sort of cross border nature of them, so there are
Speaker 6: many many aspects to look at. We plan our projects
Speaker 6: clearly meticulously, and you know, we use all sorts of
Speaker 6: industry software, plus our own models that we've developed with
Speaker 6: other projects, and the input of all the experts we've
Speaker 6: heard before. So we look to work on tasks that
Speaker 6: are going to address the very difficult questions upfront, and
Speaker 6: so we can provide clarity to investors and to government
Speaker 6: stakeholders that we're focusing on the right thing and de
Speaker 6: risking the project. Maybe to give you just sort of
Speaker 6: a flavor of the type of things that we'll be
Speaker 6: doing over the next twenty four months. Clearly, the first
Speaker 6: one is project recognition and we'll work with some of
Speaker 6: the major institutions on both sides of the Atlantic to
Speaker 6: make sure that this project becomes part of the fabric
Speaker 6: of the future networks. In Europe that's more likely to
Speaker 6: be TYNDP and projects of mutual interest, and on the
Speaker 6: North American side we look to work with DOE pup
Speaker 6: ANDEIPC to make sure that we're part of their transmission network.
Speaker 6: Looking forward, we'll be developing the needs case. That's obviously
Speaker 6: a must, and we have a significant economic model around
Speaker 6: that so that we can guide our decisions by putting
Speaker 6: all these inputs into a model that gives the returns
Speaker 6: to the project. The next, probably bigger area is to
Speaker 6: look at where our grid connection points will be. We'll
Speaker 6: do a lot of tech scoping on that and we'll
Speaker 6: look for the optimal connection points. That's clearly both economic,
Speaker 6: political and technical, and so that will involve us talking
Speaker 6: to a broad range of stakeholders to consider where the
Speaker 6: optimal points were. And obviously we're not building it for tomorrow,
Speaker 6: so we need to think where would be the optimal
Speaker 6: point to connect. Given all of the investment that we're
Speaker 6: making at the moment to institute or install renewable energy
Speaker 6: sources on both sides of the Atlantic, we must leverage
Speaker 6: the investment we make today and then maybe just moving
Speaker 6: on to the system itself. As I said earlier, we're
Speaker 6: talking with the OEMs, but we're working through a system
Speaker 6: design of what this might look like. They're clearly lots
Speaker 6: of options in front of us, but at this stage
Speaker 6: we'll be looking at at a high level to think
Speaker 6: of the optimum in terms of losses, materials, cable routs,
Speaker 6: and we'll do that in conjunction with the major OEMs,
Speaker 6: academia and other inputs that we can have from people
Speaker 6: who are also working on these long line cables. And lastly,
Speaker 6: it goes without saying that ultimately this needs to be financed,
Speaker 6: and we'll work very closely with insurers and banks at
Speaker 6: a very early stage to understand what's important for them.
Speaker 6: We can't do this without the money. We need to
Speaker 6: understand their risks right at the get go and address
Speaker 6: them through both design and the structure which we put
Speaker 6: in place. So that's a bit of a flavor of
Speaker 6: the things we're going to do for the first twenty
Speaker 6: four months.
Speaker 3: Yes, because Simon, the philosophy of this project is that
Speaker 3: for more than a majority of his revenues, it has
Speaker 3: to stand on his it meaning creating real economic value
Speaker 3: for both sides. It is not the project that we
Speaker 3: envision being just financed by taxpayer public money, which we
Speaker 3: know is very scarce right now. So although governments will
Speaker 3: be involved, very much involved, we see the beginning this
Speaker 3: project being private led with the support of government rather
Speaker 3: than government.
Speaker 6: Lad That's correct, Lauren, when we look at their command
Speaker 6: no regulatory models across the Atlantic at the moment, they're
Speaker 6: probably not the type of models that would work for
Speaker 6: this project. And so we need to think, as you said,
Speaker 6: let's make sure this is privately led, privately financed led,
Speaker 6: and that we develop regulatory models. It will need to
Speaker 6: be regulated if nothing else from a Flowers perspective, in
Speaker 6: the future, but that those develop with interaction with the
Speaker 6: key stakeholders, the regulators and the government as we go forward.
Speaker 1: I would add one thing to this. The way we
Speaker 1: look at this is this is a win win interconnector,
Speaker 1: and I explain what we mean by that. Oftentimes what
Speaker 1: happens is you build an endic connector to say that,
Speaker 1: take the case of the one from Norway to Germany.
Speaker 1: What happens is Norwegian power prices go up and German
Speaker 1: prices go down. That's all good, except the Norwegian customer loses.
Speaker 1: And the very very thing that's interesting about what we're
Speaker 1: doing is that both sides win. Again, what you've got
Speaker 1: is surpluces of electricity that you have to do something with,
Speaker 1: and you're moving it across the Atlantic. So I think
Speaker 1: this is one of the things that makes it unique.
Speaker 1: And what that means is it looks incredibly well from
Speaker 1: a commercial.
Speaker 5: Point of view.
Speaker 3: Finally, to conclude from a capital raising, what is our strategy.
Speaker 1: Yeah, so we're going out to market right now and
Speaker 1: the idea is to get strategic investors in and investors
Speaker 1: really that can bring value to us along this journey.
Speaker 1: And I just want to say to people, if you're interested,
Speaker 1: please feel free to reach out to myself, to Simon
Speaker 1: or to go on directly. Other than that, you'll probably
Speaker 1: be hearing from me in the next few weeks.
Speaker 3: Since the man, it's a pleasure partnering with you. And
Speaker 3: as the saying goes, ad Astra Per Aspera or at
Speaker 3: Canada Perasperra very good. Thank you, Thank you for listening.
Speaker 2: To Redefining Energy.
Speaker 1: Don't forget to rate the show and subscribe on Apple Podcasts,
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