WEBVTT 1 00:00:04.639 --> 00:00:08.199 With Laurent's segle and from London and Gerard read from Berlin. 2 00:00:08.720 --> 00:00:10.839 This is redefining Energy. 3 00:00:11.599 --> 00:00:16.640 Today on Relief Energy. Look, it's summertime, so we recycle 4 00:00:16.879 --> 00:00:21.920 old tapes and jahab that's your show. Explain what happened. 5 00:00:22.320 --> 00:00:25.120 Well, See, it's the first time that I've actually done 6 00:00:25.120 --> 00:00:28.000 a podcast that took an hour, and ultimately I was 7 00:00:28.079 --> 00:00:30.879 just interviewed for an hour in and around my views 8 00:00:30.920 --> 00:00:34.000 and energy disruption and what's going on in the energy space. 9 00:00:34.560 --> 00:00:37.399 I must have been enjoyed it, but I don't believe 10 00:00:37.439 --> 00:00:40.159 I could talk for an hour, but I did. There 11 00:00:40.200 --> 00:00:42.280 you go. I'm glad. I'm sorry that you had to 12 00:00:42.280 --> 00:00:44.399 go cut it from an hour down to twenty minutes. 13 00:00:44.600 --> 00:00:46.280 That must have been a painful process. 14 00:00:46.439 --> 00:00:48.960 No, No, I think I kept pretty much everything because 15 00:00:48.960 --> 00:00:51.039 it was good. So talk about your host. 16 00:00:51.280 --> 00:00:54.119 So, yeah, Lauren, it was for me interesting because it 17 00:00:54.200 --> 00:00:56.799 was on video. I taught to myself, I'll try something. 18 00:00:56.920 --> 00:00:59.320 And you know the name of the platform was called 19 00:00:59.359 --> 00:01:03.520 Clean Titans, available on YouTube. And yeah, if you want 20 00:01:03.560 --> 00:01:05.319 to see what I look like, you can look at 21 00:01:05.319 --> 00:01:08.400 it on YouTube or you can listen here on Spotify 22 00:01:08.799 --> 00:01:09.200 or Apple. 23 00:01:09.879 --> 00:01:11.760 Okay, let's listen to job. 24 00:01:12.959 --> 00:01:16.000 Welcome Gerard to Clean Titans. We're thrilled to have you 25 00:01:16.040 --> 00:01:21.200 here to share your expertise on energy transition, finance and geopolitics. 26 00:01:21.760 --> 00:01:25.200 To start, could you provide a brief overview of your 27 00:01:25.640 --> 00:01:31.200 background and what led you to focus on intersection of 28 00:01:31.239 --> 00:01:32.799 these critical periods. 29 00:01:33.480 --> 00:01:36.319 Be really honest and say it was called by accident. 30 00:01:36.719 --> 00:01:40.920 I was well first and foremost. I was always interested 31 00:01:41.159 --> 00:01:46.959 in politics, history. I actually wrote a history book I 32 00:01:47.000 --> 00:01:49.840 don't know, maybe thirty years ago. And I then actually 33 00:01:49.959 --> 00:01:53.040 ended up going to Germany and I worked in the 34 00:01:53.079 --> 00:01:56.200 finance industry, and at some point I had a client 35 00:01:56.239 --> 00:01:58.599 of mine. I said, Jared, look, I'm looking to invest 36 00:01:58.640 --> 00:02:00.439 in a solar company in Germany. Would you don't visit 37 00:02:00.519 --> 00:02:03.079 the factory? And I visited the factory and went back 38 00:02:03.079 --> 00:02:05.640 to him and said, forget about this solar stuff. It's 39 00:02:05.640 --> 00:02:07.640 just not going to work. Just the economics of it 40 00:02:07.680 --> 00:02:11.240 are so out of the money. Don't worry about He goes, oh, no, no, no, no, 41 00:02:11.599 --> 00:02:13.000 he said, we go and have a look at it again. 42 00:02:13.039 --> 00:02:15.879 The German governments are putting massive subsidies in and I 43 00:02:16.000 --> 00:02:18.000 was sort of still going, oh my god, why would 44 00:02:18.039 --> 00:02:21.280 I put money into all these subsidy based businesses make 45 00:02:21.319 --> 00:02:24.319 no sense. And then I met the founder of the 46 00:02:24.319 --> 00:02:27.360 business and a man called Alex Vogd, who found out 47 00:02:27.400 --> 00:02:29.520 he was a founder of I have quite a lot 48 00:02:29.520 --> 00:02:32.360 of renewable technology business but one being in business called 49 00:02:32.400 --> 00:02:35.759 Solo and the other one doing Q cells. And he 50 00:02:35.919 --> 00:02:39.360 persuaded me that Solo was going to revolutionize the world. 51 00:02:40.080 --> 00:02:43.039 And then my client invested, made lots of money, and 52 00:02:43.120 --> 00:02:45.639 I became the one eyed man in the land of 53 00:02:45.680 --> 00:02:48.759 the blind. But what I will say coming back to 54 00:02:48.759 --> 00:02:52.120 full circle was very interesting is if you look in 55 00:02:52.199 --> 00:02:57.960 the history, energy and geopolitics have always been very close, right, 56 00:02:58.520 --> 00:03:02.439 Wars have been fought for energy, and of law been 57 00:03:02.479 --> 00:03:06.840 lost because of lack of energy. Right and United States, 58 00:03:06.879 --> 00:03:09.000 for example, has spent a large part of the last 59 00:03:09.039 --> 00:03:13.879 seventy five years protecting key waterways for the transport of 60 00:03:13.879 --> 00:03:18.439 oil and increasingly gas. So it's always been there and thereabouts. 61 00:03:18.840 --> 00:03:21.800 But what I would say is the last twenty years 62 00:03:21.960 --> 00:03:25.159 we've sort of forgotten about the geopolitics of energy, and 63 00:03:25.319 --> 00:03:28.120 now suddenly we're rethinking about it. So that's why I 64 00:03:28.120 --> 00:03:30.199 say it's called full circle. So it's back to where 65 00:03:30.240 --> 00:03:34.680 I started. I've got this mixture of energy, technology and geopolitics. 66 00:03:34.719 --> 00:03:36.159 Know how, I'm having a lot of fun. 67 00:03:36.479 --> 00:03:41.319 You've worked across finance, technology, and energy. How has that 68 00:03:41.719 --> 00:03:49.719 interdisciplinary experience shaped your perspective on the challenges and opportunities 69 00:03:49.879 --> 00:03:50.759 we face today. 70 00:03:51.120 --> 00:03:54.360 Well, let me start with the finance side, because I 71 00:03:54.360 --> 00:03:57.039 think this is really important. When you look at something 72 00:03:57.039 --> 00:04:00.280 from a financial perspective, what you're trying to do is 73 00:04:00.439 --> 00:04:04.319 you're trying to match risk and reward, and so you're 74 00:04:04.439 --> 00:04:07.280 back to basics on this. You're looking at does it 75 00:04:07.360 --> 00:04:11.840 make economic sense? And is the risk? Is the return 76 00:04:11.879 --> 00:04:14.680 I'm going to receive enough for me to take the 77 00:04:14.759 --> 00:04:17.879 risk that's there? So the big bidding for me is 78 00:04:18.160 --> 00:04:21.199 it goes back to finance, and it goes back to economics. 79 00:04:21.279 --> 00:04:25.160 It's the ultimate driver of things. Now let me add 80 00:04:25.199 --> 00:04:28.000 to that is that what you've got is a very 81 00:04:28.040 --> 00:04:31.040 interesting thing going on in the energy space is which 82 00:04:31.040 --> 00:04:34.360 you've got massive technology change. And I'll talk a little 83 00:04:34.360 --> 00:04:36.199 bit about that. The first one of us. If we'd 84 00:04:36.199 --> 00:04:39.839 have sat here in two thousand and five, we'd be 85 00:04:39.920 --> 00:04:43.839 talking about peagal gas production and the United States being 86 00:04:43.879 --> 00:04:46.560 under a huge pressure. And here we are twenty twenty 87 00:04:46.600 --> 00:04:48.959 five in the US is now the largest producer phossiphy 88 00:04:49.079 --> 00:04:52.879 is in the world. Why because of drilling technologies. You know, 89 00:04:53.160 --> 00:04:58.160 real innovation in and around drilling technologies. Horizontal drilling, fracking 90 00:04:58.600 --> 00:05:02.040 have changed the whole landscape across the world. Now that's 91 00:05:02.040 --> 00:05:04.800 a one side. On the other side, we've seen massive 92 00:05:04.839 --> 00:05:10.720 innovation in and around electrical generation technologies, in particular wind 93 00:05:10.879 --> 00:05:14.720 and solar is the most interesting one because solar you 94 00:05:14.720 --> 00:05:17.240 can put solar panels anywhere. You don't even need an 95 00:05:17.279 --> 00:05:21.480 electrician anymore. They can use the power a village, you know, 96 00:05:21.639 --> 00:05:26.920 a garden, or even a city. So it's incredible and 97 00:05:26.959 --> 00:05:29.360 the speed of deployment is amazing. And so the result 98 00:05:29.439 --> 00:05:32.519 is we've never seen an energy technology come to market 99 00:05:32.560 --> 00:05:37.000 as quick as solar. So that's two exchanmes. Then in 100 00:05:37.040 --> 00:05:39.240 between that, it's all great, you have an energy, but 101 00:05:39.439 --> 00:05:41.759 you know we save energy, right, so you know we 102 00:05:41.959 --> 00:05:46.079 in a tank, we put gas in a cast. In 103 00:05:46.120 --> 00:05:48.399 a time, we put coal and a coal bunker. But 104 00:05:48.519 --> 00:05:50.680 now the question is what do you do electricity a 105 00:05:50.720 --> 00:05:53.839 surface electricity, Well, put it up a mountain, I put 106 00:05:53.959 --> 00:05:56.360 something like that. But increasingly we're putting them in batteries 107 00:05:56.439 --> 00:05:59.240 and those batteries and are being used to not just 108 00:05:59.240 --> 00:06:02.480 store the energy for when the surplus of power, but 109 00:06:02.560 --> 00:06:06.399 also it's been done because all our digital devices running increasingly, 110 00:06:06.519 --> 00:06:08.680 you know, and so on. So what we've got is 111 00:06:09.079 --> 00:06:12.600 huge innovation going on. And I wanted to make the 112 00:06:12.639 --> 00:06:16.279 point is the speed of innovation is accelerating. And this 113 00:06:16.439 --> 00:06:19.879 is very interesting for the energy space because the energy 114 00:06:19.879 --> 00:06:24.120 space is ultimately about infrastructure. Right on oil pipeline, it's 115 00:06:24.160 --> 00:06:26.279 going to there for seventy five years, right, So the 116 00:06:26.480 --> 00:06:29.360 huge pieces of infrastructure put on place, right, you need 117 00:06:29.399 --> 00:06:33.040 to make these big long term bets. I really need 118 00:06:33.079 --> 00:06:35.560 that grid connection there? Do I need this? And so 119 00:06:35.920 --> 00:06:38.480 suddenly we've also got risk in that area where we 120 00:06:38.519 --> 00:06:40.759 didn't see before. And in particular, I would say, also, 121 00:06:41.000 --> 00:06:43.399 it's not just by the way, when I say that, 122 00:06:43.439 --> 00:06:45.360 when I'm looking at the wrist side, it's not that 123 00:06:45.399 --> 00:06:47.920 I'm saying, Oh, the risks is all on the fossil 124 00:06:47.920 --> 00:06:50.639 fuel side, No, it's not. It's the risks is also 125 00:06:50.720 --> 00:06:53.839 on the renewable side. Right, Am I really going to 126 00:06:53.879 --> 00:06:57.399 build that extra wind turbine when on a windy day 127 00:06:57.439 --> 00:06:59.800 power prices are zero? Am I really going to that? 128 00:07:00.399 --> 00:07:02.120 But it's the same on the fossil fuel side. If 129 00:07:02.120 --> 00:07:05.399 we're very close to peak demand for oil across the world, 130 00:07:05.480 --> 00:07:09.240 am I really going to go to Venezuela and dig 131 00:07:10.240 --> 00:07:12.480 and I do exploration there when I might get a 132 00:07:12.480 --> 00:07:15.439 return on investment. So the result of what I'm trying 133 00:07:15.439 --> 00:07:19.199 to say is that we're in a very interesting environment 134 00:07:19.319 --> 00:07:22.959 from a financial perspective, an investment perspective, and energy it 135 00:07:23.079 --> 00:07:24.560 suddenlyeds become high risk. 136 00:07:24.959 --> 00:07:29.079 In your article The Cold Energy War, you highlight the 137 00:07:29.199 --> 00:07:35.279 complex geopolitical landscape, particularly for Europe. Could you elaborate on 138 00:07:35.360 --> 00:07:39.920 the key challenges Europe faces and maintaining energy security while 139 00:07:40.040 --> 00:07:41.879 transitioning to clean energy? 140 00:07:42.800 --> 00:07:46.839 Oh? Yeah, So the European situation is simple, which is 141 00:07:46.879 --> 00:07:49.879 that we just don't have enough fossil fuels, right, biggest 142 00:07:50.360 --> 00:07:53.040 importer of oil in the world. Why because we don't 143 00:07:53.079 --> 00:07:55.560 have any of it? Right? Whatever we had in the 144 00:07:55.920 --> 00:07:59.279 in ort Sea has now been taken out of the ground. 145 00:07:59.319 --> 00:08:01.399 So isn't there is some oil left there? But it's 146 00:08:01.519 --> 00:08:03.800 very expensive to take out, so you know you're probably 147 00:08:04.240 --> 00:08:06.319 taking it from the US or taking it. But it's 148 00:08:06.360 --> 00:08:09.680 not just that, it's also you look at, say in 149 00:08:10.040 --> 00:08:12.199 the in the gas area, you've also seen peak supply 150 00:08:12.279 --> 00:08:15.439 of that, and although again there is gas still left, 151 00:08:16.240 --> 00:08:19.279 what you've got is environmental concerns in around. And what 152 00:08:19.319 --> 00:08:21.600 I mean by that is, say take Gronnigan, which is 153 00:08:21.839 --> 00:08:24.319 in the Netherlands. There's definitely more gas off the coast 154 00:08:24.360 --> 00:08:27.600 of it, but we've had a right there's definitely gas, 155 00:08:27.600 --> 00:08:32.320 for example, off the Irish host, but again environmental concerns 156 00:08:32.320 --> 00:08:34.519 stopping us doing that. And it'd also make a point 157 00:08:34.639 --> 00:08:37.360 look of a take a cold just it's a dirty fuel, right, 158 00:08:37.440 --> 00:08:39.799 and it's staff on the ground, particularly in Eastern Europe, 159 00:08:40.159 --> 00:08:41.720 and to come of it out. But if you look 160 00:08:41.759 --> 00:08:45.240 at it all in all, it's really difficult for Europe 161 00:08:45.320 --> 00:08:48.039 to actually go on energy needs. We also have. I 162 00:08:48.120 --> 00:08:50.879 didn't talk about the whole nuclear thing. We've got pro 163 00:08:51.000 --> 00:08:55.200 nuclear countries France, we've got anti nuclear countries Germany, right, 164 00:08:55.480 --> 00:08:58.200 no consensus on that. And so the result of it 165 00:08:58.240 --> 00:09:00.919 then is that it's again from European very it's very 166 00:09:00.919 --> 00:09:02.360 difficult to meet our own energy needs. 167 00:09:02.480 --> 00:09:05.240 So I would also add as well that it was 168 00:09:05.320 --> 00:09:08.919 also a core part of i'd call it German dynamic 169 00:09:09.039 --> 00:09:14.120 strategy and they defense strategy, which was to integrate into 170 00:09:14.159 --> 00:09:15.080 the Russian economy. 171 00:09:15.200 --> 00:09:18.879 We'll sell them our cars, We'll buy oil, gas, uranium, 172 00:09:19.399 --> 00:09:22.360 some coal from them. That's sort of what happened, and 173 00:09:22.639 --> 00:09:26.120 obviously that's worked. Would say the Germans would argue that's 174 00:09:26.159 --> 00:09:30.080 worked very well because they got a pieceful reunification greed 175 00:09:30.240 --> 00:09:32.480 that did work for them, but it ain't working for 176 00:09:32.519 --> 00:09:34.879 them now right And so now what we've got in 177 00:09:34.960 --> 00:09:37.159 Europe is a bit of a scramble, which is how 178 00:09:37.200 --> 00:09:41.279 do we more energy independent? And I think what we 179 00:09:41.360 --> 00:09:45.159 also realize, which makes it very difficult for heavy industry, 180 00:09:45.320 --> 00:09:48.840 particular in Europe, is that we were getting cheap natural 181 00:09:48.840 --> 00:09:51.840 gas from Russia through a pipeline. Now, whatever way you 182 00:09:51.879 --> 00:09:57.840 look at it, we're taking gas, liquefying it, bringing it across, 183 00:09:57.919 --> 00:10:00.679 it's going to be much more expensive than in the US. 184 00:10:00.720 --> 00:10:03.759 That means we've certainly got a competitive disadvantage against the US, 185 00:10:03.799 --> 00:10:07.960 but against any other country that has natural gas. And 186 00:10:08.039 --> 00:10:10.720 as a result, what we're seeing is industry posing down 187 00:10:10.759 --> 00:10:12.759 across Europe. So it's difficult. That's why I say the 188 00:10:12.799 --> 00:10:16.480 geopolitics has come into it again. Because the geopolitics is 189 00:10:16.679 --> 00:10:20.279 uncertainty is there, and we can't do without energy. So 190 00:10:20.440 --> 00:10:23.080 we have to think about stuff right, and we are, 191 00:10:23.360 --> 00:10:26.480 certainly from European perspective, really really thinking about what we 192 00:10:26.559 --> 00:10:28.399 need to do over the next decade or so. 193 00:10:28.799 --> 00:10:31.639 And the technology is marching ahead really fast. 194 00:10:32.399 --> 00:10:34.799 And the technology is marshal. That's the good news because 195 00:10:35.639 --> 00:10:39.679 if you path forward for Europe is to electrify as 196 00:10:39.759 --> 00:10:42.240 much as we can in the energy system. And the 197 00:10:42.279 --> 00:10:44.919 reason I say that is from an energy independence point 198 00:10:44.919 --> 00:10:49.159 of view, you can become energy independent. I'm talking about 199 00:10:49.200 --> 00:10:53.000 Europe can become energy independent because of the fact that 200 00:10:53.120 --> 00:10:57.320 Europe has within its borders producing up for electricity to 201 00:10:57.360 --> 00:11:00.759 meet its own needs, okay, and also expand going forward, 202 00:11:00.799 --> 00:11:03.000 it'll also be able to continue meeting those needs. So 203 00:11:03.039 --> 00:11:06.440 that's really really important energy independence. But the second thing 204 00:11:06.480 --> 00:11:09.480 what's interesting about that is you've also had an opportunity 205 00:11:09.519 --> 00:11:13.240 to actually recreate the way the system works in designs 206 00:11:13.279 --> 00:11:16.759 because we've also got something else happening, which is that 207 00:11:16.799 --> 00:11:20.559 we're electrifying or other industries that have not been electrified. 208 00:11:20.600 --> 00:11:24.519 So very simple transport is electrifying means electricity demand goes up. 209 00:11:25.159 --> 00:11:28.080 It means that you know there's a demand there to 210 00:11:28.120 --> 00:11:31.120 have EV chargers, all that type of stuff. That's number one. 211 00:11:31.600 --> 00:11:35.480 Number two just to move to the digitalization of our 212 00:11:35.519 --> 00:11:39.399 economies and in particular the move to AI data centers, etcetera. 213 00:11:39.600 --> 00:11:42.000 They need electrictic they don't need coal, they don't need 214 00:11:42.000 --> 00:11:45.120 gas slot or oil. They electricity. So how do you 215 00:11:45.200 --> 00:11:49.279 get them electricity as quick as possible? That's another key charge. 216 00:11:49.399 --> 00:11:51.759 Now why I say that's very interesting because if you 217 00:11:51.799 --> 00:11:55.080 take a data center, if you really think about it, 218 00:11:55.159 --> 00:11:57.720 you can use the fact that you're building that infrastructure 219 00:11:57.759 --> 00:12:00.559 out for the data center for the society, and you 220 00:12:00.600 --> 00:12:03.039 can use, for example, the excess heat that is produced 221 00:12:03.080 --> 00:12:07.799 from this. You can actually begin to use the data 222 00:12:07.840 --> 00:12:10.879 center as flexibility play. When there's too much win in 223 00:12:10.919 --> 00:12:15.080 the system. Yes, what you ramp up their data centers. 224 00:12:15.080 --> 00:12:17.720 They may be put on some batteries. When there's not enough, 225 00:12:17.840 --> 00:12:20.799 you're slowing down the data centers. That's where I'm coming from. 226 00:12:20.840 --> 00:12:24.879 We have to really engage and look at this electrification 227 00:12:25.240 --> 00:12:28.200 from the demand side as an opportunity to rethink the 228 00:12:28.240 --> 00:12:31.639 whole system so that you can cost effectively get to 229 00:12:31.720 --> 00:12:36.320 a much more energy independent system than the one we 230 00:12:36.399 --> 00:12:39.279 have a present. Because Europe is zeopolitical to the point 231 00:12:39.279 --> 00:12:41.559 of view, it's really is stuck in the middle. That's 232 00:12:41.559 --> 00:12:45.120 what I would describe it. Right, it depends totally on 233 00:12:45.879 --> 00:12:48.120 international trade to keep the lights on. 234 00:12:48.159 --> 00:12:52.440 You mentioned the US is shifting stance on its impact 235 00:12:53.000 --> 00:12:58.559 on Europe's energy strategy. How should Europe balance its alliance 236 00:12:59.240 --> 00:13:01.840 with its need for energy independents. 237 00:13:02.200 --> 00:13:05.519 Well, if we really look at the strategy of Europe 238 00:13:06.000 --> 00:13:09.279 last two and a half decades, really is one. Russia 239 00:13:09.360 --> 00:13:12.320 is where we get our resources from, mainly again oil 240 00:13:12.360 --> 00:13:15.559 and gas. The United States where we get our technology 241 00:13:15.600 --> 00:13:19.440 from and our national security, our defense. And China is 242 00:13:19.440 --> 00:13:22.720 where we get our goods from. So that relationship is 243 00:13:22.759 --> 00:13:29.399 broken down, and that's multifaceted and highly complex. So just 244 00:13:29.639 --> 00:13:33.840 a very practical example is that European value chain for 245 00:13:34.879 --> 00:13:37.240 let's say, so wind turbines. Yes, we make our own 246 00:13:37.240 --> 00:13:40.879 wind turbines, yeah, absolutely, but there are core components that 247 00:13:40.919 --> 00:13:42.919 come from China. Right, if you look at an electric 248 00:13:43.000 --> 00:13:46.600 vehicle today, same thing. Core components can close come from Gina. 249 00:13:46.639 --> 00:13:48.080 You can go on and on and on about how 250 00:13:48.080 --> 00:13:51.679 we're integrated into China. On the other hand, then we've 251 00:13:51.679 --> 00:13:55.360 got United States, where you know, the majority of Europe 252 00:13:55.399 --> 00:14:00.639 cannot defend itself without the United States. Precarious position. The 253 00:14:00.679 --> 00:14:05.159 good news is we have wined ourselves off Russian fossil 254 00:14:05.200 --> 00:14:07.440 fuels over the last few years, and we've done this 255 00:14:07.600 --> 00:14:09.639 very very quickly. So there's a way forward, and the 256 00:14:09.639 --> 00:14:12.279 way forward is to be independent. I don't think anybody 257 00:14:12.320 --> 00:14:16.840 wants to be overly dependent on a third party. You 258 00:14:16.960 --> 00:14:19.440 want to be independent and you're in a much stronger 259 00:14:19.480 --> 00:14:21.279 situation then at this point in time, if you can 260 00:14:21.320 --> 00:14:23.799 stand up for yourself, and that's the path forward to 261 00:14:23.840 --> 00:14:26.200 you stand up. So it does mean that you need 262 00:14:26.240 --> 00:14:28.960 to have some form of independence in and around your production. 263 00:14:29.720 --> 00:14:32.559 You need to have independence in and around your development 264 00:14:32.600 --> 00:14:35.240 of technology, and you need to have independence in and 265 00:14:35.320 --> 00:14:36.039 around energy. 266 00:14:36.279 --> 00:14:39.159 But it's been costly for your to win itself from 267 00:14:39.240 --> 00:14:42.960 Russian fossil fuels. But the good thing is the cost 268 00:14:43.399 --> 00:14:47.000 and the efficiency of reable just keeps exponentially improving. 269 00:14:48.320 --> 00:14:54.000 Yes, so it's been incredibly expensive, and renewables and the 270 00:14:54.080 --> 00:14:57.600 very certain technologies right there are low cost. So the 271 00:14:57.679 --> 00:15:02.000 good news is the cost of the various different technologies 272 00:15:02.000 --> 00:15:04.919 to enable Europe to become more energy independent to have 273 00:15:04.960 --> 00:15:11.039 come tumbling down, in particular electric vehicles, solar panels, batteries, 274 00:15:11.960 --> 00:15:15.639 wind turbines, you know, power electronics to manage the software. 275 00:15:16.240 --> 00:15:18.600 All have come down. So that's the good news. The 276 00:15:18.759 --> 00:15:21.039 sort of badly news the power system that we have 277 00:15:21.159 --> 00:15:23.600 in place, the design sort in terms of how power 278 00:15:23.600 --> 00:15:28.320 markets work and fifty years ago, how the grid actually functions, 279 00:15:28.399 --> 00:15:31.559 in terms of how it's balanced, etcetera, etcetera. That was 280 00:15:31.600 --> 00:15:34.360 put in over one hundred years ago, and it is 281 00:15:34.399 --> 00:15:37.879 not fit for the twenty first century. So that requires 282 00:15:37.960 --> 00:15:41.320 significant change in the way we think about the grid. 283 00:15:41.399 --> 00:15:44.879 So give you very practical example is that if you 284 00:15:44.879 --> 00:15:49.279 look at say storage for natural gas, a country like 285 00:15:49.320 --> 00:15:54.000 Germany would have the ability to store at any one 286 00:15:54.080 --> 00:15:57.639 moment in time, maybe two months of supply of natural gas, 287 00:15:57.679 --> 00:16:03.200 so nothing something happens too more supply. Okay, how much 288 00:16:03.559 --> 00:16:08.039 energy or a French storage does Germany have for its 289 00:16:08.080 --> 00:16:09.279 electricity purposes? 290 00:16:09.919 --> 00:16:10.519 Yeah? 291 00:16:11.000 --> 00:16:14.600 Like maybe an hour? Right that pump storage and batteries. 292 00:16:14.879 --> 00:16:17.399 It's an hour now where I'm coming from, you and 293 00:16:17.440 --> 00:16:19.600 all of it is somebody might say, yeah, but actually 294 00:16:19.600 --> 00:16:21.440 what we do is we use the fossil fuel system 295 00:16:21.679 --> 00:16:24.759 for the storage for electricity. That's very true. But the 296 00:16:24.840 --> 00:16:29.200 point I'm making is more is that in a world 297 00:16:29.200 --> 00:16:31.120 where you have too much power, which is what you 298 00:16:31.200 --> 00:16:34.279 have as a renewable world. But you need energy storage 299 00:16:34.360 --> 00:16:36.440 and we need to build more energy storage. That's what 300 00:16:36.480 --> 00:16:39.159 I got to day again rethink what we did before. 301 00:16:39.200 --> 00:16:42.879 We built loads of energy storage fossil fuels, but now 302 00:16:42.879 --> 00:16:46.960 we need to do energy storage for storing not the 303 00:16:47.039 --> 00:16:49.799 excess natural gas, but storing the excess electricity. That's what 304 00:16:49.799 --> 00:16:52.279 we have to It's a red inking that needs to 305 00:16:52.279 --> 00:16:53.639 be put in there, and that means that you need 306 00:16:53.679 --> 00:16:56.279 to change the incentive structures and stuff like that. That's 307 00:16:56.320 --> 00:16:58.399 i'd say the challenge going forward. Right. 308 00:16:58.759 --> 00:17:04.960 I interviewed this Caldera last week. He has heat batteries 309 00:17:05.400 --> 00:17:09.240 to decarbonize industrial heat, which is like fifty percent of 310 00:17:09.279 --> 00:17:11.319 the energy for industries. 311 00:17:11.400 --> 00:17:14.640 Right. Sorry, and by the way, there's there's no doubt 312 00:17:14.680 --> 00:17:17.880 you talked to them doustrial use. What's very very clear 313 00:17:17.960 --> 00:17:20.880 I'm talking now from the European perspective is the way 314 00:17:21.000 --> 00:17:25.119 forward for heavy industry and actually just food processing and 315 00:17:25.119 --> 00:17:28.400 stuff like this is they electrify all the processes. And 316 00:17:28.920 --> 00:17:32.400 you're absolutely right. What you do is you use heat 317 00:17:32.440 --> 00:17:35.240 storage stuff like that. So again you have storage comes 318 00:17:35.240 --> 00:17:38.039 in different forms, but heat storage is going to be 319 00:17:38.039 --> 00:17:43.119 a really critical part of enabling energy independence going forward. 320 00:17:43.200 --> 00:17:47.400 Right, what role do you see China playing in the 321 00:17:47.519 --> 00:17:54.039 cold energy world, especially with this dominance and clean technology manufacturing. 322 00:17:55.079 --> 00:17:58.000 So let's take a step back, because I think what 323 00:17:58.039 --> 00:18:01.880 we need to do is understand what China is doing, 324 00:18:02.599 --> 00:18:04.680 why they're doing it, and then we should probably learn 325 00:18:04.680 --> 00:18:08.839 from them. Right. So what China is a country that 326 00:18:09.000 --> 00:18:12.279 at the end of the day is not energy independent, 327 00:18:13.160 --> 00:18:15.279 and in particular what it has has got loads of coal. 328 00:18:15.559 --> 00:18:19.559 Absolutely great, you burn loads of coal, and it's pretty 329 00:18:19.599 --> 00:18:22.160 bad in terms of local pollution if forget about climate change, 330 00:18:22.519 --> 00:18:25.799 just in terms of smog horrendous. Right, So they have 331 00:18:25.839 --> 00:18:27.119 to move away from and they've done a good job 332 00:18:27.200 --> 00:18:29.680 actually so far of if you look at cleaning up 333 00:18:29.720 --> 00:18:32.119 small levels and cities and stuff like this. Right, But 334 00:18:32.200 --> 00:18:34.160 the bigger issue that they have is they have to 335 00:18:34.279 --> 00:18:38.359 import fuel. So they're importing coal, right, and they're importing 336 00:18:38.599 --> 00:18:42.680 all their oil, right, and they're importing natural gas as well. Right. 337 00:18:43.240 --> 00:18:46.279 So this is from a strategic point of view, this 338 00:18:46.400 --> 00:18:47.160 is difficult for them. 339 00:18:47.200 --> 00:18:47.400 Right. 340 00:18:47.960 --> 00:18:51.440 They also realize that, and they realized very early on 341 00:18:51.599 --> 00:18:55.799 that there was significant technology change going to happen in 342 00:18:55.839 --> 00:19:00.400 the energy space, which if they embraced, could enable them 343 00:19:00.440 --> 00:19:03.599 to actually create a new industry. And I want to 344 00:19:03.599 --> 00:19:05.359 go back and say to you again, if we sat 345 00:19:05.400 --> 00:19:08.599 here fifteen years ago and you asked me the name 346 00:19:08.759 --> 00:19:12.359 of a Chinese company, I probably couldn't do it. And 347 00:19:12.559 --> 00:19:16.079 I say that because now we've got a whole while 348 00:19:16.200 --> 00:19:19.599 of companies that are global names, right, and there's going 349 00:19:19.640 --> 00:19:20.960 to be more and more of them, and a lot 350 00:19:21.000 --> 00:19:23.559 of them actually are in the energy space. Right, so 351 00:19:23.759 --> 00:19:29.920 people know BYD, they know CATL. Again, you were again 352 00:19:29.960 --> 00:19:31.720 fifteen years ago, you wouldn't been able to name one 353 00:19:31.759 --> 00:19:34.200 brand name. So they did it also from an economic 354 00:19:34.240 --> 00:19:37.200 point if they understood. They took a strategic view, there's 355 00:19:37.200 --> 00:19:39.640 going to be a technology revolution here. We need to 356 00:19:39.680 --> 00:19:43.960 dominate these technologies, right. So then when they do so 357 00:19:44.039 --> 00:19:48.039 today that seventy five percent of batteries worldwide come from China. 358 00:19:48.359 --> 00:19:52.880 If you look at the whole value chain from processing 359 00:19:53.000 --> 00:19:56.839 materials all the way down to the production of the battery, 360 00:19:57.119 --> 00:20:00.480 the Chinese control of value chain, they also go, let's 361 00:20:00.480 --> 00:20:03.000 say control, but there are certainly leaders in the technology 362 00:20:03.039 --> 00:20:07.039 development in all these different technologies, right, So China has 363 00:20:07.039 --> 00:20:10.160 done that. So what do we learn from that, Well, 364 00:20:10.200 --> 00:20:12.160 we have to learn that sometimes you have to take 365 00:20:12.160 --> 00:20:14.680 a strategic view on things and that we do have 366 00:20:14.759 --> 00:20:18.440 limited resources and I'm talking about limited brain power, limited 367 00:20:18.440 --> 00:20:20.279 capital or whatever, and sometimes you just have to really 368 00:20:20.400 --> 00:20:22.319 go I'm going to take a bet of this and 369 00:20:22.359 --> 00:20:24.559 I'm going to make it happen. And then the other 370 00:20:24.599 --> 00:20:26.440 thing that you learn from the town is when you 371 00:20:26.519 --> 00:20:31.160 do go at something, you go at a big all right, 372 00:20:31.839 --> 00:20:35.759 and you scale really quickly. And if you scale really quickly, 373 00:20:35.799 --> 00:20:38.440 then it's very difficult for people to catch up with you. Right, 374 00:20:38.839 --> 00:20:41.599 And we see this in other areas. Right. If you 375 00:20:41.599 --> 00:20:44.000 think of a Microsoft, it's basically got a global monopoly. 376 00:20:44.400 --> 00:20:45.920 That's just sort of what they're trying to drive. But 377 00:20:46.000 --> 00:20:49.200 you get to such scale that nobody can compete with you. Right. 378 00:20:49.599 --> 00:20:52.559 So that's what China has done very well, and we 379 00:20:52.599 --> 00:20:54.400 need to sort of learn from that, I think going 380 00:20:54.480 --> 00:20:58.359 forward and really make strategic decisions in and around what 381 00:20:58.400 --> 00:21:00.480 the future is and then create that future. 382 00:21:00.960 --> 00:21:04.160 I was looking at Ember's report and they have a 383 00:21:04.200 --> 00:21:08.559 slide or solar dependence is just you import in a 384 00:21:08.680 --> 00:21:11.920 ship year one and then you have twenty nine years 385 00:21:11.960 --> 00:21:16.319 of independence. So every thirty years. You're going to need 386 00:21:16.319 --> 00:21:20.000 to rid those solar panels back and batteries maybe twenty years. 387 00:21:20.559 --> 00:21:22.319 And by the way, I didn't see that slide, but 388 00:21:22.319 --> 00:21:24.400 I think that's a very good way of putting it, 389 00:21:25.000 --> 00:21:27.640 because what you're actually saying is that so one of 390 00:21:27.680 --> 00:21:30.599 you imported from China at low cost, because what you've 391 00:21:30.640 --> 00:21:34.400 just said is it's thirty years of that producing power. 392 00:21:34.400 --> 00:21:38.160 Fere Right, It's a completely different one if I'm importing oil, 393 00:21:38.519 --> 00:21:41.720 because that barrel of oil has to be imported tomorrow 394 00:21:41.960 --> 00:21:46.680 the day after, right, So I'm absolutely totally rich about this, right. 395 00:21:47.000 --> 00:21:50.640 And that's again back to technologies like that, which are 396 00:21:50.720 --> 00:21:53.319 again my criticism of the fossil fuel will bee. I 397 00:21:53.359 --> 00:21:54.720 just have to keep doing it, taking more and more 398 00:21:54.759 --> 00:21:58.039 out to meet that demand. Right, while electricity and with 399 00:21:58.480 --> 00:22:00.480 solar and wind, what you're doing is you're putting an 400 00:22:00.519 --> 00:22:02.839 acid in place, is there for at least twenty years, 401 00:22:03.440 --> 00:22:06.359