WEBVTT 1 00:00:07.919 --> 00:00:10.160 You are listening to Redefining Energy. 2 00:00:10.800 --> 00:00:15.160 Your co hosts from Berlin Gerard Rey and from London 3 00:00:15.439 --> 00:00:16.160 Laurent Sag. 4 00:00:17.280 --> 00:00:20.239 Today I'm redefining Energy. We are going to talk about 5 00:00:20.760 --> 00:00:26.039 vpp's virtual power plants, especially focus on North. 6 00:00:25.879 --> 00:00:29.600 America, and we're also going to talk about Lasagnia and 7 00:00:29.640 --> 00:00:34.320 lots of lots of Yes Jah, we hear a lot 8 00:00:34.359 --> 00:00:38.320 about VPP and more and more so virtual power plants. 9 00:00:38.759 --> 00:00:44.119 We hear about deer distributed energy resources, and of course 10 00:00:44.159 --> 00:00:47.000 as the grid becomes more intermittent while the lord is 11 00:00:47.039 --> 00:00:51.560 going those vppd A platforms. I think they provide a 12 00:00:51.600 --> 00:00:55.640 critical role by shedding demands sometimes for a few minutes, 13 00:00:55.840 --> 00:00:58.679 to alleviate the straits on the grater exactly. 14 00:00:59.079 --> 00:01:03.320 I think they're a really important part of not just 15 00:01:03.799 --> 00:01:08.079 the grid going forward, but also of buildings and of 16 00:01:08.200 --> 00:01:10.280 really just if you want to save money, you have 17 00:01:10.359 --> 00:01:12.280 to have some form of MPPs. And now they also 18 00:01:12.400 --> 00:01:16.959 enable a whole new different business models. Very very exciting area. 19 00:01:17.640 --> 00:01:20.159 Yeah, I mean talking about buildings. I saw that Shander 20 00:01:20.200 --> 00:01:23.599 Electric signed a kind of dr contract with Shell were 21 00:01:23.599 --> 00:01:26.680 talking about hours. So it's not part of a platform, 22 00:01:26.760 --> 00:01:30.000 it's a direct contract, but it really shows that we're 23 00:01:30.000 --> 00:01:32.239 starting to move the needles when it comes to building, 24 00:01:32.359 --> 00:01:33.000 which is great. 25 00:01:33.879 --> 00:01:34.519 Absolutely. 26 00:01:35.159 --> 00:01:38.840 So we brought in one of your friends and her 27 00:01:38.920 --> 00:01:43.280 name is Dana Geranzi. She's based in Bulder of Colorado, 28 00:01:43.480 --> 00:01:47.519 and she's the CEO of a platform called Bultas. 29 00:01:47.599 --> 00:01:50.560 Which is one of the needing dr platforms in the US. 30 00:01:50.879 --> 00:01:54.760 Let's listen to what Dana has to say. Dana, welcome 31 00:01:54.799 --> 00:01:55.319 to the show. 32 00:01:55.879 --> 00:01:56.599 Thanks for having me. 33 00:01:56.640 --> 00:02:00.000 Guys. Maybe I just kick off by the team. Today 34 00:02:00.239 --> 00:02:04.040 is going to be virtual power plants VPPs. They're all 35 00:02:04.079 --> 00:02:06.879 the rage, but sometimes I don't even know what they are, 36 00:02:07.040 --> 00:02:09.199 even though I've been meant to be looking at them 37 00:02:09.199 --> 00:02:11.240 for years. So what are they doing? 38 00:02:12.319 --> 00:02:16.120 I don't think you're the only one. They're everything. They're everywhere, 39 00:02:16.240 --> 00:02:19.080 all at once. But seriously, they do have a very 40 00:02:19.199 --> 00:02:23.800 very broad definition. It might be helpful first to unpack 41 00:02:23.879 --> 00:02:27.120 what distributed energy resources are because the simplest way I 42 00:02:27.120 --> 00:02:30.759 would describe a virtual power plant is it's an aggregation 43 00:02:31.240 --> 00:02:35.560 of distributed energy resources that can serve in lieu of 44 00:02:35.680 --> 00:02:39.000 an actual power plant. So it's not virtual. I've heard 45 00:02:39.159 --> 00:02:41.840 really smart people refer to it as a distributed power 46 00:02:41.919 --> 00:02:45.520 plant to dispel the notion that there's anything virtual about it. 47 00:02:45.560 --> 00:02:48.800 These are real assets, and we bring them together and 48 00:02:48.840 --> 00:02:54.240 we aggregate and orchestrate them like a power plant. Meaning 49 00:02:54.479 --> 00:02:57.159 when the grid needs more power because people are using 50 00:02:57.159 --> 00:02:59.439 more energy, it can do one of two things. It 51 00:02:59.439 --> 00:03:01.960 can either turk and on a power plant, or we 52 00:03:02.000 --> 00:03:05.319 can help on the demand side reduce load and use 53 00:03:05.360 --> 00:03:10.159 people's distributed resources like energy storage, building management systems and 54 00:03:10.199 --> 00:03:13.840 the like, and in aggregate, all these things together form 55 00:03:13.919 --> 00:03:17.120 a very very reliable, powerful resource that we call a 56 00:03:17.199 --> 00:03:21.400 virtual power plant because it's not a physical central fossil 57 00:03:21.439 --> 00:03:24.240 fuel burning power plant. That's what we call a VPP. 58 00:03:25.360 --> 00:03:28.960 Well, we should call it probably a DPP digital power. 59 00:03:28.719 --> 00:03:34.039 Plant, digital, decarbonized, distributed. There's a lot of D words, 60 00:03:34.080 --> 00:03:36.439 but I think we've landed with Z. We do a 61 00:03:36.439 --> 00:03:39.680 lot of things with v around here. My company is Voltus, 62 00:03:40.080 --> 00:03:41.800 so we're pretty okay with it too. 63 00:03:42.680 --> 00:03:45.159 If I go into details, because I love the details here. 64 00:03:45.960 --> 00:03:49.240 How do you get a signal from the market, Like 65 00:03:49.719 --> 00:03:53.000 a few minutes before, a month before, the day before 66 00:03:53.680 --> 00:03:56.319 via computer, somebody's coorting new said we need to giga 67 00:03:56.400 --> 00:03:58.280 what or something? How does it work? 68 00:03:58.919 --> 00:04:02.199 Yes, yes, and yes to all of that. Markets have 69 00:04:02.280 --> 00:04:05.280 so many different layers. There's future planning that can happen 70 00:04:05.400 --> 00:04:08.599 years and years in advance, and we can sell into 71 00:04:08.639 --> 00:04:11.960 those markets and commit to grid operators that we will 72 00:04:12.000 --> 00:04:17.560 reliably bring resources of whatever volume we procure, whatever volume 73 00:04:17.600 --> 00:04:20.439 they need, we'll bring those resources to them and we'll say, hey, 74 00:04:20.480 --> 00:04:22.079 in three years, this is going to be there. It's 75 00:04:22.120 --> 00:04:25.560 the equivalent of committing to building a power plant. Those 76 00:04:25.600 --> 00:04:30.800 are often forward capacity markets. Then there are everything from 77 00:04:30.959 --> 00:04:34.639 monthly procurements we participate in to day ahead and real 78 00:04:34.680 --> 00:04:37.040 time markets, which are probably terms from layer to most 79 00:04:37.079 --> 00:04:39.959 people in the industry. And so we go all the 80 00:04:40.000 --> 00:04:43.600 way up through like instant frequency response. And so if 81 00:04:43.600 --> 00:04:46.519 you think about the grid, it needs to be planned 82 00:04:46.560 --> 00:04:49.279 at the macro phase. We got to know the lights 83 00:04:49.279 --> 00:04:50.759 are going to stay on a few years from now, 84 00:04:50.759 --> 00:04:53.600 and that there's enough stuff being built, and then it 85 00:04:53.680 --> 00:04:56.199 needs to be operated. We need to know what we're 86 00:04:56.199 --> 00:04:58.519 going to do tomorrow, what are were going to eat tomorrow, 87 00:04:58.519 --> 00:04:59.519 We need to do that. We need to do that 88 00:04:59.560 --> 00:05:02.839 food sh and then in the moment, if it needs 89 00:05:02.879 --> 00:05:05.120 a little bit more juice, we also need to give 90 00:05:05.160 --> 00:05:08.000 it bad And so there are all these different markets. 91 00:05:08.000 --> 00:05:10.720 They're called different things depending on whether you're in North 92 00:05:10.720 --> 00:05:15.079 America or Europe or what country. Sometimes they're called balancing markets. 93 00:05:15.480 --> 00:05:18.399 There's reserve markets to just make sure that we always 94 00:05:18.480 --> 00:05:21.360 keep the lights on, and so in a very very 95 00:05:21.360 --> 00:05:24.319 practical sense on the time side, it's e all of 96 00:05:24.360 --> 00:05:27.519 the above, we do all of that. You also asked 97 00:05:27.560 --> 00:05:30.519 about how we receive the signals. That's a very very 98 00:05:30.720 --> 00:05:35.519 technology forward, complicated question. The simplest way to answer it 99 00:05:35.560 --> 00:05:38.959 is that they're truly digitized signals. So we receive signals 100 00:05:39.000 --> 00:05:41.000 as if we were a power plant, how much does 101 00:05:41.040 --> 00:05:43.560 the grid need? And when we're then serving in the 102 00:05:43.560 --> 00:05:46.560 middle as a platform, we pass those signals through to 103 00:05:46.959 --> 00:05:50.480 our assets and were able to control everything from a 104 00:05:50.519 --> 00:05:55.240 smart thermostat up through a building management system to large 105 00:05:55.279 --> 00:05:59.319 industrial processes and data centers. We send those signals through 106 00:06:00.079 --> 00:06:04.000 simplify it dramatically. Grid has very complicated parameters, but what 107 00:06:04.040 --> 00:06:07.199 we're doing with our customers is making it extremely simple 108 00:06:07.800 --> 00:06:11.800 according to their operational flexibility. And then we marry it 109 00:06:11.839 --> 00:06:14.439 all together. We bring a bunch of Tetris pieces in 110 00:06:14.480 --> 00:06:17.879 and deliver what the grid asked for, and we're in 111 00:06:17.920 --> 00:06:20.839 the very very fortunate business of paying our own customers 112 00:06:20.879 --> 00:06:23.839 to do this, so it's actually really fun. People say, well, 113 00:06:23.879 --> 00:06:26.000 how do you get paid, But we actually talk about 114 00:06:26.040 --> 00:06:28.839 our customers as the end users, and so the grid 115 00:06:28.839 --> 00:06:31.319 pays us, yes, as if we're a power plant. But 116 00:06:31.399 --> 00:06:33.319 I get to pay my customers every day, which is 117 00:06:33.360 --> 00:06:33.839 really cool. 118 00:06:34.680 --> 00:06:38.959 Among your clients, I've seen Walmart, So the grid is 119 00:06:39.000 --> 00:06:41.519 going to send you a signal. I guess you have 120 00:06:41.639 --> 00:06:45.199 different type of client. Some it's probably easier to take 121 00:06:45.279 --> 00:06:49.079 than others. It's a bit like lasagna. You get the 122 00:06:49.160 --> 00:06:51.920 lower part we can call every day, and others it's 123 00:06:52.000 --> 00:06:55.399 going to be more complex. And then yeah, tell the guys. Okay, 124 00:06:55.480 --> 00:06:58.639 so sorry guys your fridger, I need to the temperature 125 00:06:58.680 --> 00:07:02.160 of your fridger, your frozen food a bit higher, or 126 00:07:02.160 --> 00:07:05.680 I need to the light so sorry. I mean that's 127 00:07:05.680 --> 00:07:08.759 why we have you here, is to get those type 128 00:07:08.959 --> 00:07:09.639 of answers. 129 00:07:10.000 --> 00:07:12.720 I've never heard lasagna before. I might take that one. 130 00:07:12.759 --> 00:07:15.879 I like it. I mentioned tetris, like the notion that 131 00:07:15.920 --> 00:07:19.240 you're putting together, you're weaving, or you're stacking different types 132 00:07:19.279 --> 00:07:21.759 of assets that can do different types of things, and 133 00:07:21.800 --> 00:07:25.040 that the net result is actually more positive when you 134 00:07:25.079 --> 00:07:27.399 take all these different things at different strengths and weaknesses. 135 00:07:27.480 --> 00:07:29.560 The sum is better than the parts. That's what we do. 136 00:07:29.839 --> 00:07:31.759 That would argue the sum of the lasagna is better 137 00:07:31.759 --> 00:07:35.639 than any individual part personally. But to your actual question, 138 00:07:36.040 --> 00:07:39.639 it depends. You could get anybody from the energy industry 139 00:07:39.720 --> 00:07:42.079 on any podcast, ask them a question and the answer 140 00:07:42.160 --> 00:07:45.439 is probably it depends. But what that means here is 141 00:07:46.120 --> 00:07:48.399 even in the case of a big box retail store 142 00:07:48.439 --> 00:07:51.959 like Walmart, depending on what the grid means and depending 143 00:07:51.959 --> 00:07:53.959 on the store we can and the circumstances, we can 144 00:07:54.000 --> 00:07:56.959 do different things. So that might look like we've control 145 00:07:57.000 --> 00:08:01.360 integration with an HVAC system, and that's simply changing the temperature. 146 00:08:01.759 --> 00:08:06.079 Even within that world, there are different use cases. Increasingly 147 00:08:06.079 --> 00:08:09.839 our assets are used to drive renewable penetration on the grid. 148 00:08:10.399 --> 00:08:12.920 So what happens when the wind for just a second 149 00:08:13.160 --> 00:08:16.920 stops blowing unexpectedly or the sun goes behind some clouds. 150 00:08:17.360 --> 00:08:20.560 You need a really quick backstop balancing resource and might 151 00:08:20.680 --> 00:08:23.759 only need it for ten minutes. For ten minutes, you 152 00:08:23.800 --> 00:08:28.199 can do things with HVAC that do not impact occupancy, 153 00:08:28.480 --> 00:08:32.480 meaning people don't notice if it's sixty eight or seventy 154 00:08:32.559 --> 00:08:36.279 two degrees I'm seeking in fahrenheit. You'll have to excuse me. 155 00:08:36.600 --> 00:08:40.080 But people don't notice for ten minutes because the thermal 156 00:08:40.159 --> 00:08:42.600 load of the space is such that it doesn't truly 157 00:08:42.679 --> 00:08:45.360 impact their comfort. And so we actually can take a 158 00:08:45.360 --> 00:08:48.759 lot more load off the grid for quick response balancing 159 00:08:48.840 --> 00:08:52.759 type events per store than we can for very long 160 00:08:53.120 --> 00:08:58.879 emergency summer heat wave, winter cold snap, multi hour duration dispatch, 161 00:08:59.320 --> 00:09:02.399 and we know how to accommodate and how to flex 162 00:09:02.440 --> 00:09:07.080 accordingly with our assets. Similarly, increasingly lots of stores have 163 00:09:07.320 --> 00:09:10.559 behind the meter assets. So behind the meter asset means 164 00:09:10.639 --> 00:09:14.879 something like a distributed generator, more and more energy storage, 165 00:09:15.519 --> 00:09:17.720 and so if you have an asset like that, you 166 00:09:17.799 --> 00:09:20.159 also can do a lot of things very very flexibly. 167 00:09:20.240 --> 00:09:22.360 But you need to understand the parameters of the battery, 168 00:09:22.519 --> 00:09:25.120 and first and foremost, you need to understand what is 169 00:09:25.159 --> 00:09:29.399 the customer. Their primary reason for being the primary reason 170 00:09:29.519 --> 00:09:32.279 for a big box retail store is to make sure 171 00:09:32.399 --> 00:09:34.240 that people who go in that store are comfortable and 172 00:09:34.279 --> 00:09:36.840 want to buy things. So we have to respect that 173 00:09:36.919 --> 00:09:39.399 first and foremost, and that's what we do when we 174 00:09:39.440 --> 00:09:43.440 put together the understanding of different industries and customer sets 175 00:09:43.480 --> 00:09:46.360 that we work with and how we can leverage controls 176 00:09:46.360 --> 00:09:49.519 and technology to marry like this is what they can do, 177 00:09:49.600 --> 00:09:51.279 and this is what the grid needs, and then you 178 00:09:51.320 --> 00:09:53.240 take all the pieces and you make lasagna. 179 00:09:53.399 --> 00:09:56.480 Danik, can I ask you to talk about the supply side, 180 00:09:56.480 --> 00:09:57.840 because a lot of what you've talked about up to 181 00:09:57.840 --> 00:10:00.440 now as demand, and in particular, just maybe how you 182 00:10:00.480 --> 00:10:04.000 see solar and storage going forward, noting just I mean 183 00:10:04.120 --> 00:10:08.240 just incredible cost reductions we've seen over the last eighteen months, 184 00:10:08.279 --> 00:10:10.559 and obviously performance improvements as well. 185 00:10:11.240 --> 00:10:13.639 I agree. So I started in this industry almost twenty 186 00:10:13.759 --> 00:10:18.639 years ago, and every year we underestimate the growth of renewables. 187 00:10:18.879 --> 00:10:22.399 The cost decrease of renewables storage is following the same curve, 188 00:10:22.919 --> 00:10:25.519 and so the debates become how low will go, how 189 00:10:25.600 --> 00:10:28.799 much renewable penetration can we get to. But there's a 190 00:10:29.039 --> 00:10:32.159 well accepted trend that's happening now, which is great from 191 00:10:32.200 --> 00:10:34.840 a climate point of view. Keep in mind there's also 192 00:10:35.000 --> 00:10:38.679 tremendous load growth happening. For the first time in twenty 193 00:10:38.759 --> 00:10:42.200 thirty years. We are using more and more and more electricity. 194 00:10:42.519 --> 00:10:47.200 That has to do with our electrification of everything, electric vehicles. 195 00:10:47.639 --> 00:10:51.399 We're moving things to the electricity sector. We're also adding 196 00:10:51.519 --> 00:10:55.159 load more and more data center load AI. So when 197 00:10:55.159 --> 00:10:57.720 we started this business, we definitely did not forecast just 198 00:10:57.759 --> 00:11:01.159 the tremendous amount of growth that a data center loads 199 00:11:01.200 --> 00:11:03.399 would bring. So you have that, and then you have 200 00:11:03.559 --> 00:11:06.279 solar and storage and wind and all these other assets, 201 00:11:06.639 --> 00:11:09.200 and I just think we need everything, and I'm glad 202 00:11:09.200 --> 00:11:11.960 we're doing everything. I don't think yet it would be 203 00:11:11.960 --> 00:11:14.039 a wonderful problem to have that there was just so 204 00:11:14.159 --> 00:11:16.720 much solar and storage that we didn't still need demand 205 00:11:16.720 --> 00:11:20.039 side flexibility. But like anything, you're going to get to 206 00:11:20.200 --> 00:11:24.200 a diminishing returns on your cost. The last one percent 207 00:11:24.240 --> 00:11:28.480 of hours are going to be extremely expensive, extremely expensive 208 00:11:28.720 --> 00:11:31.600 to continue to just put batteries on the grid. And 209 00:11:31.679 --> 00:11:34.360 so in any world that I see, I think it's 210 00:11:34.399 --> 00:11:38.120 still really economic and for the greater good to have 211 00:11:38.360 --> 00:11:40.559 some flex on the demand side as well. It's just 212 00:11:40.600 --> 00:11:44.480 the optimized equation. On top of all of that, we've 213 00:11:44.519 --> 00:11:48.200 also got a grid that's getting old, it's aging, we're 214 00:11:48.240 --> 00:11:51.879 seeing signs of stress. The worse the climate stress gets, 215 00:11:51.919 --> 00:11:54.039 the more signs of stress we see, and so we 216 00:11:54.080 --> 00:11:56.000 need to be able to do all of these things. 217 00:11:56.720 --> 00:11:59.759 You mentioned data centers, and obviously these are a game changer, 218 00:12:00.399 --> 00:12:02.759 and you could actually look at these data centers and say, 219 00:12:02.840 --> 00:12:05.279 isn't there a problem for the system, or they could 220 00:12:05.279 --> 00:12:07.879 be incredibly helpful to the system, because you could say 221 00:12:07.879 --> 00:12:10.480 that they could become the biggest virtual power plants in 222 00:12:10.519 --> 00:12:10.919 the world. 223 00:12:11.639 --> 00:12:14.080 Yeah, I think it's even more than that. So yes, 224 00:12:14.200 --> 00:12:17.519 they could, if they were truly going to be completely flexible, 225 00:12:17.759 --> 00:12:20.799 be the biggest virtual power plants in the world. I 226 00:12:20.799 --> 00:12:23.279 don't think the economics are there for them to want 227 00:12:23.399 --> 00:12:25.720 to do that right now, they would make a lot 228 00:12:25.759 --> 00:12:29.519 more money running the data center. However, they're facing the 229 00:12:29.600 --> 00:12:32.600 problem of not being able to bring the data centers 230 00:12:32.639 --> 00:12:35.679 online because depending on what utility territory they're in or 231 00:12:35.720 --> 00:12:38.399 what region they're in, there simply is not enough supply. 232 00:12:38.879 --> 00:12:41.440 And so I look at it as a huge opportunity 233 00:12:41.519 --> 00:12:45.120 because now you have big tech, big money focused on 234 00:12:45.159 --> 00:12:48.080 this problem that we need to figure out how to 235 00:12:48.120 --> 00:12:50.440 do the energy transition. And so it used to be 236 00:12:50.480 --> 00:12:52.639 this very walky thing that some of us worked on 237 00:12:53.000 --> 00:12:54.759 and talked about, and nobody knew what I was saying 238 00:12:54.799 --> 00:12:57.240 when I went to dinner with friends. And now not 239 00:12:57.279 --> 00:13:00.000 only does everybody understand the problem, at least to some exit. 240 00:13:00.759 --> 00:13:04.960 But you have big tech with both big wallets and 241 00:13:05.320 --> 00:13:08.879 a huge desire to help us solve this problem, and 242 00:13:09.200 --> 00:13:12.360 many of them want to do that in a clean way, 243 00:13:12.639 --> 00:13:14.840 and so it's an opportunity. And I think we'll look 244 00:13:14.879 --> 00:13:17.279 back on this and see a huge inflection point where 245 00:13:17.279 --> 00:13:19.879 there was so much attention and so much desire to 246 00:13:19.919 --> 00:13:22.279 do this the right way that the funding just started 247 00:13:22.320 --> 00:13:24.159 really transforming the way that we all do this. 248 00:13:24.919 --> 00:13:28.399 If we switched to market structure regulation. There was a 249 00:13:28.399 --> 00:13:31.440 few years ago Firk called the twenty to twenty two 250 00:13:31.919 --> 00:13:34.000 Can you explain a bit to what that is and 251 00:13:34.240 --> 00:13:35.679 did it change anything for you? 252 00:13:36.440 --> 00:13:39.519 In the US, Furk issued order twenty two twenty two. 253 00:13:39.879 --> 00:13:41.840 It was back in twenty twenty. It's been a number 254 00:13:41.879 --> 00:13:45.200 of years now. Twenty two twenty two was huge for 255 00:13:45.559 --> 00:13:49.759 setting the right direction of how these wholesale markets should 256 00:13:49.759 --> 00:13:52.799 be treating resources on the demand side. So we'd had 257 00:13:52.879 --> 00:13:55.759 prior Firk orders. I'll spare the audience, but we've had 258 00:13:55.799 --> 00:13:58.679 prior Firk orders that say the demand side should be 259 00:13:58.720 --> 00:14:02.799 treated equally to this apply side. A megawat not used 260 00:14:02.879 --> 00:14:04.679 or a nega loot if you will, is just as 261 00:14:04.720 --> 00:14:07.919 valuable as a megawat that comes online should be paid accordingly. 262 00:14:08.360 --> 00:14:12.799 But we never got as deep into the smaller assets 263 00:14:12.840 --> 00:14:17.639 such as electric vehicles, battery storage, and the rules and 264 00:14:17.720 --> 00:14:20.600 regulations around them can get very, very complicated, and so 265 00:14:20.679 --> 00:14:24.039 twenty two twenty two was an effort by Ferk to say, 266 00:14:24.200 --> 00:14:27.960 these assets are extremely valuable, and we want the different 267 00:14:28.000 --> 00:14:32.519 transmission operators and independent system operators that we have in 268 00:14:32.559 --> 00:14:36.480 North America under fur jurisdiction anyway to do certain things. 269 00:14:36.799 --> 00:14:39.960 We want it to be possible to bundle them all together. 270 00:14:40.080 --> 00:14:42.799 And sometimes when you get into deep regulation, you can 271 00:14:42.840 --> 00:14:45.240 get death by a thousand pets. One of the reasons 272 00:14:45.240 --> 00:14:47.399 I was excited about twenty two twenty two is it's 273 00:14:47.399 --> 00:14:50.120 an effort to avoid that. So it's not that we 274 00:14:50.159 --> 00:14:53.240 can't do demand side without twenty two twenty two. We've 275 00:14:53.240 --> 00:14:55.879 been doing this for a very long time. This is 276 00:14:55.879 --> 00:14:59.080 what Voltas does all day long. But there are things 277 00:14:59.120 --> 00:15:02.480 that will briefly gears and ways that we can access 278 00:15:02.519 --> 00:15:05.919 assets in certain markets that today we can't and smaller 279 00:15:05.919 --> 00:15:09.679 and smaller assets. Residential becomes more and more of a 280 00:15:09.720 --> 00:15:11.919 growth market as we see the order make its way 281 00:15:11.960 --> 00:15:16.120 through regulation. Am I excited about how quickly it's been happening. No, 282 00:15:16.799 --> 00:15:18.799 we see some of the ISO say we'll be ready 283 00:15:18.799 --> 00:15:21.519 in twenty thirty. The order came up in twenty twenty. Guys, 284 00:15:21.519 --> 00:15:23.799 come on, So I think there is this like both 285 00:15:24.279 --> 00:15:28.320 genuine real excitement and optimism and also a deep desire 286 00:15:28.399 --> 00:15:30.919 for urgency. And let's get going on some of these 287 00:15:31.000 --> 00:15:33.120 things that we're seeing play out right now. 288 00:15:33.759 --> 00:15:35.799 At the beginning of our conversation, you said that you 289 00:15:35.799 --> 00:15:38.440 would send the money back to your clients, which is 290 00:15:38.480 --> 00:15:41.639 great and it's a great proposal. What is it like 291 00:15:41.799 --> 00:15:43.720 you managed to cut their bits? But what five? 292 00:15:45.320 --> 00:15:49.399 Depending on the sector, their bills can be a huge 293 00:15:49.440 --> 00:15:52.080 portion of their out there. So there are certain industries, 294 00:15:52.120 --> 00:15:56.279 heavy industry crypto loads for example, where energy is their 295 00:15:56.399 --> 00:15:59.919 number one expense and so we can go really deep 296 00:16:00.120 --> 00:16:03.159 into that and so it really becomes energy sector dependent 297 00:16:03.360 --> 00:16:06.480 how much we can cut their bills. Twenty percent is 298 00:16:06.519 --> 00:16:07.399 a good role of sun. 299 00:16:07.600 --> 00:16:13.080 Nice nice DNA. You're welcome, Yeah, twenty percent. I find 300 00:16:13.120 --> 00:16:15.000 your product extremely interesting. 301 00:16:18.120 --> 00:16:21.240 Energy spent Who doesn't want because not all energy is 302 00:16:21.279 --> 00:16:23.960 created equal. We're going to stick with food for a second, right, 303 00:16:24.000 --> 00:16:26.000 So you go to a salad bar and you pay 304 00:16:26.000 --> 00:16:28.720 by the weight, and it's like, how is the cucumber 305 00:16:28.840 --> 00:16:32.240 worth the same amount as the salmon? It doesn't really 306 00:16:32.240 --> 00:16:35.120 make sense. It's not really correct. So not all hours 307 00:16:35.159 --> 00:16:39.279 are created equal on the grid. Overnight, when you have 308 00:16:39.840 --> 00:16:45.440 baseload running, sometimes pricing goes negative, and so really understanding 309 00:16:45.480 --> 00:16:48.960 that nuance taking the burden off of the customer to 310 00:16:49.159 --> 00:16:53.279 understand when and how they're going to use energy. Two 311 00:16:53.440 --> 00:16:56.320 certain hours are going to really hurt them. Demand charges 312 00:16:56.360 --> 00:17:00.559 can be off the charts sometimes understanding that that hour 313 00:17:00.720 --> 00:17:03.480 is just not the one. An equivalent for someone who 314 00:17:03.559 --> 00:17:06.559 just never doesn't know anything about industry is uber surge pricing. 315 00:17:07.319 --> 00:17:09.720 Can you wait five minutes and not pay ten times 316 00:17:09.720 --> 00:17:11.559 the price for that uber you want it to take 317 00:17:11.839 --> 00:17:14.440 most of the time you can? And so part of 318 00:17:14.480 --> 00:17:17.000 what we do is just deeply understand the economics of 319 00:17:17.039 --> 00:17:21.839 our customer, what motivates then, and what are their non starters. 320 00:17:22.880 --> 00:17:26.400 We work with electric school bus fleets. There's probably no 321 00:17:26.599 --> 00:17:30.319 price at all that will convince that fleet not to 322 00:17:30.359 --> 00:17:32.920 take the kids too in front school, But when the 323 00:17:32.960 --> 00:17:35.279 buses are sitting there overnight, when they're sitting there during 324 00:17:35.319 --> 00:17:38.480 the day, now the price point is much lower, so 325 00:17:38.599 --> 00:17:41.640 really understanding that, marrying it with what the grid needs 326 00:17:41.759 --> 00:17:44.920 and then having the lasagna and biass nets. You know, 327 00:17:45.359 --> 00:17:48.920 I'll get some lunch after this. That is how it 328 00:17:48.960 --> 00:17:52.000 can work because you do not need to reduce twenty 329 00:17:52.000 --> 00:17:55.039 percent of the hours to reduce twenty percent of your cough. 330 00:17:55.799 --> 00:17:58.200 And dand what you've just touched on there as a 331 00:17:58.200 --> 00:18:02.880 whole area mobility. Very interested to hear your view on 332 00:18:03.119 --> 00:18:07.160 the use of these electric vehicles, whether they're buses, trucks, 333 00:18:07.240 --> 00:18:10.759 or vehicles now on how you see that going forward. 334 00:18:11.079 --> 00:18:15.079 I see the growth of electric vehicles and in particularly 335 00:18:15.240 --> 00:18:19.960 large fleets as another resource for the grid. And again 336 00:18:20.039 --> 00:18:23.039 you have to respect to primary use case. School Buses 337 00:18:23.039 --> 00:18:25.119 exist to take kids to and from school, the same 338 00:18:25.160 --> 00:18:27.480 way that the walmartn't exists, so that people can go 339 00:18:27.559 --> 00:18:30.319 and buy what they need to buy. But those are 340 00:18:30.799 --> 00:18:36.240 sitting grid resources. They're ddrs on wheels, and they have 341 00:18:36.400 --> 00:18:39.160 things they can do to really benefit the grid. Why 342 00:18:39.200 --> 00:18:43.400 would we not squeeze out and increase the utilization rate 343 00:18:43.440 --> 00:18:46.200 of these assets that we have all around us. It's 344 00:18:46.279 --> 00:18:49.359 just an extremely inefficient system. If you really look at 345 00:18:49.359 --> 00:18:52.119 our system, We've got buildings and all the load control 346 00:18:52.200 --> 00:18:55.000 that they can do. You have electric vehicles just battery 347 00:18:55.039 --> 00:18:58.640 storage on wheels, and you use them for fractions of 348 00:18:58.720 --> 00:19:02.200 their actual capability. So the most efficient way as a 349 00:19:02.240 --> 00:19:04.839 society that we can get more out of our existing 350 00:19:04.880 --> 00:19:09.119 infrastructure is to make better use and have secondary intertiary 351 00:19:09.240 --> 00:19:13.599 use cases for these very capital intensive assets. Batter Is 352 00:19:13.599 --> 00:19:16.720 are expensive, and so when we can go and partner. 353 00:19:16.759 --> 00:19:19.480 We have partners in the battery storage space, and the 354 00:19:19.519 --> 00:19:22.079 partnership goes like this, Hey, you're selling an expensive stink. 355 00:19:22.559 --> 00:19:24.799 Let us help you make it cheaper for your clients. 356 00:19:25.279 --> 00:19:27.319 That's compelling too, So we do a lot of work. 357 00:19:27.359 --> 00:19:30.480 It's not just that we go directly to the client 358 00:19:30.519 --> 00:19:33.759 that's buying a battery. We're also going to the developers 359 00:19:33.799 --> 00:19:36.160 and helping them bring a cheaper solution. 360 00:19:37.319 --> 00:19:39.519 Data. I'm going to put a bit your system to 361 00:19:39.559 --> 00:19:43.799 the test. We've seen the recent auction for capacity at 362 00:19:43.880 --> 00:19:49.039 PGM reach crazy prices four times. I mean, what's your 363 00:19:49.079 --> 00:19:52.160 interpretation of that and how can you help. 364 00:19:52.799 --> 00:19:56.240 I noticed that data point too, was it still is 365 00:19:56.599 --> 00:19:59.960 huge talk of the industry. A couple things. One, it's 366 00:20:00.039 --> 00:20:05.480 the market working. So credit to PJM for sending a 367 00:20:05.480 --> 00:20:08.759 price signal to the market that incentivizes people to come build. 368 00:20:08.799 --> 00:20:11.640 What's happening right now, everybody wants to build in PJM. 369 00:20:12.359 --> 00:20:15.640 What's pgm's problem. They need more capacity. That's at the 370 00:20:15.880 --> 00:20:18.920 highest level, that's how a market should work. So we 371 00:20:19.000 --> 00:20:22.519 now have this price point. We have a couple other 372 00:20:22.599 --> 00:20:26.920 problems though. Here in the US and probably everywhere, there's 373 00:20:26.960 --> 00:20:30.920 an interconnection queue, and there is simply a time lag 374 00:20:31.000 --> 00:20:33.880 to build new assets. It is hard to build a 375 00:20:33.880 --> 00:20:36.920 new power plant quickly. It's hard to put anything on 376 00:20:36.960 --> 00:20:38.799 the gride quickly when you also have to go through 377 00:20:38.799 --> 00:20:43.880 the interconnection queue. VPPs are already in the ground like, 378 00:20:44.119 --> 00:20:46.240 they're already there. They don't need to go through an 379 00:20:46.279 --> 00:20:50.559 interconnection queue. The stores already exist, the school buses are 380 00:20:50.559 --> 00:20:54.279 already out there, the buildings already have their building management systems, 381 00:20:54.880 --> 00:20:57.279 there's storage going in behind the mean or stuff like that. 382 00:20:57.839 --> 00:21:00.599 These assets exist and so it's a matter of connecting them. 383 00:21:01.119 --> 00:21:03.279 So that brings me to the second point, which is 384 00:21:03.319 --> 00:21:06.680 this is a tremendous opportunity for VPPs to rise to 385 00:21:06.720 --> 00:21:09.359 the occasion, and that's what we're all talking about. Voltus, 386 00:21:09.400 --> 00:21:12.960 our peers. How can we grow, how much can we 387 00:21:13.000 --> 00:21:16.160 grow as quickly as possible because we're one of the 388 00:21:16.200 --> 00:21:18.680 only asset types that can move that quickly. And the 389 00:21:18.680 --> 00:21:22.720 next auction already is coming up in December. That's how 390 00:21:22.759 --> 00:21:25.279 I view it. This is the first time we've seen 391 00:21:25.960 --> 00:21:30.680 a realcific numerical data point, first major time. There's data 392 00:21:30.680 --> 00:21:33.640 points all the time, but it's the first really newsworthy 393 00:21:34.400 --> 00:21:38.799 frost the ocean data point of this phenomena we're seeing 394 00:21:38.799 --> 00:21:42.039 where we now have huge load growth for the first 395 00:21:42.039 --> 00:21:45.359 time in decades. The reason Boltus exists, in part is 396 00:21:45.400 --> 00:21:48.279 to build out these resources in a way that continues 397 00:21:48.319 --> 00:21:51.480 the energy transition. We exist so that the penetration of 398 00:21:51.519 --> 00:21:54.079 renewables can become more and more and more. But you 399 00:21:54.200 --> 00:21:57.039 need that load side flexibility day night. 400 00:21:57.200 --> 00:22:00.599 You've created vert Us eight years ago, and I guess 401 00:22:00.640 --> 00:22:04.160