Latest / What's Your Problem? / Can Hot Bricks Save the World? (The Solar Era, Part 2)

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Can Hot Bricks Save the World? (The Solar Era, Part 2) · What's Your Problem?

• 0:15
  Speaker 1: Pushkin.
• 0:20
  Speaker 2: So Jenny Chase, who's arguably the foremost solar analyst in
• 0:24
  Speaker 2: the world, recently said, by twenty thirty, in the middle
• 0:27
  Speaker 2: of the day, essentially everywhere in the world, unless it's
• 0:30
  Speaker 2: a cloudy day, electricity is free.
• 0:33
  Speaker 1: She told me that at nine am today. I interviewed
• 0:36
  Speaker 1: her five hours ago.
• 0:37
  Speaker 3: Seven hours All right, great, So now that we live
• 0:41
  Speaker 3: in that world like people don't get how profound a
• 0:46
  Speaker 3: transformation that is.
• 0:53
  Speaker 1: I'm Jacob Goldstein, and this is what's your problem. I
• 0:55
  Speaker 1: hope you listened to last week's episode where I did,
• 0:58
  Speaker 1: in fact talk to solar expert Jenny Chase about how
• 1:02
  Speaker 1: solar energy got so cheap. That was the first of
• 1:07
  Speaker 1: three shows we're doing on the triumph of solar power.
• 1:10
  Speaker 1: Today and next week, I'm going to be talking to
• 1:12
  Speaker 1: people who have very big plans for what to do
• 1:16
  Speaker 1: with that very cheap or even free, intermittent solar energy.
• 1:21
  Speaker 1: My guest today is John O'Donnell. He wants to use
• 1:25
  Speaker 1: cheap solar and wind energy to solve one of the
• 1:28
  Speaker 1: biggest unsolved problems in the energy transition heat industrial heat,
• 1:34
  Speaker 1: delivering the reliable, intense heat that companies around the world
• 1:39
  Speaker 1: need to make everything from steel beams.
• 1:41
  Speaker 2: To t shirts.
• 1:42
  Speaker 1: Today, company's burn fossil fuel to generate that heat. John
• 1:47
  Speaker 1: is the co founder of Rondo Energy, a company that
• 1:50
  Speaker 1: John thinks has figured out an economical way to turn
• 1:54
  Speaker 1: intermittent electricity into industrial heat. John has started companies before,
• 1:59
  Speaker 1: and at the beginning of our conversation he told me
• 2:01
  Speaker 1: one of the most important and really kind of surprising
• 2:04
  Speaker 1: lessons that he learned from those earlier.
• 2:06
  Speaker 2: Companies innovate as little as you can. If the technology
• 2:11
  Speaker 2: is going to make a difference, one of the important
• 2:14
  Speaker 2: questions is not just how quickly can I develop it
• 2:16
  Speaker 2: and make a first unit, but how quickly can I
• 2:19
  Speaker 2: make it bankable? How quickly can I make it suitable
• 2:23
  Speaker 2: for billion dollar infrastructure investments. And it is a very
• 2:27
  Speaker 2: high standard to be able to prove reliability, durability, certainty
• 2:33
  Speaker 2: of deployability. And there are lots of material science research groups,
• 2:41
  Speaker 2: folks who are trying to work on innovations at an
• 2:45
  Speaker 2: individual cell level, who don't really necessarily understand the challenge
• 2:52
  Speaker 2: that customers by systems, bankers by infrastructure that we know
• 2:57
  Speaker 2: will last for thirty years. And it was with that
• 3:02
  Speaker 2: rigorous focus of what is the simplest, most proven thing
• 3:07
  Speaker 2: that we could do that led us down the path
• 3:12
  Speaker 2: that we're that we chose because we found a path
• 3:16
  Speaker 2: that others had opened two hundred years ago. That you know,
• 3:22
  Speaker 2: we found a way to reuse a technology from the
• 3:25
  Speaker 2: eighteen fifties with a physics insight that let us use
• 3:30
  Speaker 2: these proven materials in this new way to solve this challenge.
• 3:35
  Speaker 1: I love the idea that innovation is not your friend.
• 3:38
  Speaker 1: Like that's such a it's such a flip, right, it's
• 3:41
  Speaker 1: like the OCAM's razor of starting an energy transition company
• 3:45
  Speaker 1: or something.
• 3:46
  Speaker 2: Well, that's right, And you know, we saw this go
• 3:50
  Speaker 2: back to clean tech one point. Oh, go back to
• 3:52
  Speaker 2: two thousand and five, where there were companies that were
• 3:57
  Speaker 2: going to make PV out of anything but silicon because
• 4:01
  Speaker 2: we knew silicon was expensive.
• 4:02
  Speaker 1: PV meaning photovo takes photos solar solar panels.
• 4:06
  Speaker 2: Yeah, and everybody knew that. Everybody quote unquote knew that
• 4:12
  Speaker 2: the simple dumb thing that we've been doing for a
• 4:15
  Speaker 2: long time, silicon wasn't going to get cheap enough. And
• 4:19
  Speaker 2: then China put capital into reducing the cost of making polysilicon,
• 4:26
  Speaker 2: just build more production. The cost of polysilicon fell seventy
• 4:30
  Speaker 2: percent in one year. And today, just because of Right's law,
• 4:36
  Speaker 2: just because of learning curve, the simplest technology became the
• 4:41
  Speaker 2: dominant one. Today we see dozens of alternate battery chemistries
• 4:48
  Speaker 2: in electrochemical.
• 4:49
  Speaker 1: Batteries, alternatives to lithium ion, alternative lif yest, that's.
• 4:54
  Speaker 2: Right, which are facing that same Okay, how fast can
• 4:59
  Speaker 2: lithium ion improve? And it continues to improve better than
• 5:03
  Speaker 2: anyone forecasts. And again in our case, we are doing
• 5:10
  Speaker 2: the absolute simplest thing and it is a solution that
• 5:14
  Speaker 2: we know for sure works.
• 5:16
  Speaker 1: So you mentioned you came up with this idea that
• 5:20
  Speaker 1: is a version of a two hundred year old idea.
• 5:24
  Speaker 1: What's the big idea? What's that idea?
• 5:27
  Speaker 2: Up until about ten years ago, most of the energy
• 5:30
  Speaker 2: storage in the world was at blast furnaces. In the
• 5:33
  Speaker 2: eighteen fifties, there was an innovation that reduced coal use
• 5:37
  Speaker 2: at a blast furnace by building a tower with a
• 5:41
  Speaker 2: thousand tons of brick within it with air passages. The
• 5:45
  Speaker 2: exhaust from the blast furnace blows through that tower, heats
• 5:48
  Speaker 2: the brick to fifteen hundred C. Then things are switched around.
• 5:52
  Speaker 2: The exhaust is being passed through another tower, and the
• 5:55
  Speaker 2: tower full of hot brick air is being sucked through
• 5:59
  Speaker 2: that tower and preheated to twelve hundred cea into the
• 6:02
  Speaker 2: furnace to save coal.
• 6:04
  Speaker 1: So basically, when they burn coal to make iron, they
• 6:09
  Speaker 1: take the exhaust heat that comes out of the furnace,
• 6:12
  Speaker 1: they use that to heat up bricks, and then later
• 6:16
  Speaker 1: they feed that heat from the bricks back into the
• 6:18
  Speaker 1: furnace and it makes the plant essentially run more efficiently.
• 6:22
  Speaker 2: That's right, And we had a physics insight that if
• 6:27
  Speaker 2: we built a particular structure we could use the same
• 6:32
  Speaker 2: technology that is in your toaster. A very small amount
• 6:36
  Speaker 2: of heating elements are delivering heat by radiation, thermal radiation
• 6:41
  Speaker 2: and heating in the whole surface of the bread uniformly.
• 6:45
  Speaker 2: If we built the right structure, we could embed electrical
• 6:48
  Speaker 2: heating elements in a structure of brick with air passages
• 6:53
  Speaker 2: and heat that brick rapidly and uniformly to very high
• 6:58
  Speaker 2: temperatures and then pull heat out of it, just the
• 7:02
  Speaker 2: way the blast furnace units do. Cool air in superheated
• 7:06
  Speaker 2: air out, and with superheated air we can drive a
• 7:09
  Speaker 2: cement kiln, or we can drive a boiler and make
• 7:12
  Speaker 2: steam for making everything from baby food to chemicals, and
• 7:17
  Speaker 2: that unlocked using this abundant you know, brick is basically
• 7:22
  Speaker 2: made from dirt, certain kinds of clay. Yeah, no critical minerals,
• 7:28
  Speaker 2: and an unrefined material. I mean, that's one of the
• 7:31
  Speaker 2: things about Tesla wrote a report last year they're so
• 7:35
  Speaker 2: called master Plan three, their forecast for stationary storage. Their
• 7:41
  Speaker 2: assessment was the world is going to have twice as
• 7:43
  Speaker 2: much heat battery as electrochemical battery storage, but that this
• 7:49
  Speaker 2: is categlorically so much lower cost because it's using raw materials,
• 7:56
  Speaker 2: not refined materials, because it's not doing any chemistry of
• 7:59
  Speaker 2: any kind. It's the same technologies.
• 8:03
  Speaker 1: Just making stuff hot. It's just eating.
• 8:05
  Speaker 2: Bricks, so you can use raw materials exactly.
• 8:09
  Speaker 1: So okay, So just to kind of summarize, there's a
• 8:14
  Speaker 1: big problem in the world. Industries burn fossil fuel for
• 8:17
  Speaker 1: heat to make almost everything, steal, cement, clothes, whatever. You have,
• 8:23
  Speaker 1: This idea the kind of solution to the problem. We
• 8:27
  Speaker 1: can use intermittent, cheap, renewable electricity to heat up bricks
• 8:33
  Speaker 1: and use those bricks essentially to provide that heat. What
• 8:38
  Speaker 1: do you have to do, to industrialize it, to commercialize it,
• 8:41
  Speaker 1: to make it a thing in the world.
• 8:43
  Speaker 2: So step by step. One of our engineering team members
• 8:48
  Speaker 2: and his last job was working on mocks six hypersonic missiles.
• 8:52
  Speaker 2: He now does computational fluid simulations on air moving at
• 8:57
  Speaker 2: about four miles an hour, and the challenge is just
• 9:00
  Speaker 2: as high. We could not do what we're doing without
• 9:04
  Speaker 2: modern computer systems that let us do detailed simulations of
• 9:09
  Speaker 2: the structure and behavior. But step by step it was
• 9:14
  Speaker 2: really identifying, okay, which materials, which manufacturing processes, what geometry,
• 9:20
  Speaker 2: And we built a series of things that fit on
• 9:24
  Speaker 2: a desktop, to things that look like an industrial refrigerator,
• 9:27
  Speaker 2: to things that are just multiplied by about ten x.
• 9:32
  Speaker 2: And right now we're doing the fifty x step as
• 9:36
  Speaker 2: we go from the first commercial pilot unit to the
• 9:40
  Speaker 2: first series manufacturing of the commercial models. There are plenty
• 9:45
  Speaker 2: of different steps along the way this thing. As I
• 9:48
  Speaker 2: said earlier, how do we innovate as little as possible,
• 9:51
  Speaker 2: as much as necessary, but as little as possible, And
• 9:55
  Speaker 2: how do we pick subsystems and partners so that we
• 9:59
  Speaker 2: are certain we can go to massive scale Because like
• 10:03
  Speaker 2: speed is the most important thing, one of the studies
• 10:08
  Speaker 2: of this cal as of heat batteries. Their finding was, Yeah,
• 10:12
  Speaker 2: this is going to eliminate about twenty percent of total
• 10:15
  Speaker 2: world CO two when it gets to scale. Okay, twenty
• 10:19
  Speaker 2: percent is a lot, and it's going to reduce the
• 10:22
  Speaker 2: cost of manufacturing all the commodities that we use. So
• 10:28
  Speaker 2: let's get to it. How do we get there as
• 10:30
  Speaker 2: fast as possible?
• 10:31
  Speaker 1: In a way, for something to scale that fast, it
• 10:34
  Speaker 1: has to be cheaper, right. The only way something can
• 10:37
  Speaker 1: grow that fast is if it's just cheaper and simple, right.
• 10:42
  Speaker 1: It has to be those things. Otherwise it won't grow fast.
• 10:45
  Speaker 2: As long as there is some sort of premium or
• 10:47
  Speaker 2: higher cost, it will go as slowly as possible. If
• 10:51
  Speaker 2: you're in a razor thin margin commodity business, the last
• 10:57
  Speaker 2: thing you want is to increase your cost of production.
• 11:00
  Speaker 2: Your customers may go elsewhere. But if there is no
• 11:05
  Speaker 2: emission solution that will reduce your cost of production.
• 11:08
  Speaker 4: Yeah, markets, huge flows of private capital will drive it
• 11:14
  Speaker 4: to scale. It's if it's ready, if it really does
• 11:19
  Speaker 4: meet what it says it does, if it's safe.
• 11:22
  Speaker 2: I mean, there are lots of things that we and
• 11:24
  Speaker 2: as I said earlier, that is it proven enough that
• 11:28
  Speaker 2: infrastructure capital can apply, which is just.
• 11:31
  Speaker 1: As most sort of conservative, cautious capital or they want
• 11:34
  Speaker 1: to make sure not just that it works, but that'll
• 11:36
  Speaker 1: work every day for thirty years.
• 11:39
  Speaker 2: That's right. And of course we saw the solar industry
• 11:43
  Speaker 2: as each technology became bankable, enormous explosion and growth as
• 11:49
  Speaker 2: financial engineers joined you know, manufacturing engineers and built an
• 11:53
  Speaker 2: industry that meets everybody's you know. And that is the
• 11:56
  Speaker 2: opportunity we have right now, this new class of supplying
• 12:02
  Speaker 2: the energy for industrial heat. If you just do a
• 12:06
  Speaker 2: units conversion, it's about seven thousand gigawatts. It's many times
• 12:10
  Speaker 2: more renewables that exist in the world today that will
• 12:14
  Speaker 2: be needed in this new market segment. And grid researchers,
• 12:19
  Speaker 2: notably Jesse Jenkins at Princeton, have identified that when these
• 12:23
  Speaker 2: technologies are connected to the grid, they help the grid,
• 12:27
  Speaker 2: they make it more robust, they help more renewables connect
• 12:31
  Speaker 2: because it's a new special class of load. So there's
• 12:36
  Speaker 2: a virtuous cycle.
• 12:38
  Speaker 1: Well, and it's optimized to want to use energy at
• 12:41
  Speaker 1: a time when there's too much energy, right, Like, that's
• 12:43
  Speaker 1: the whole point, right.
• 12:45
  Speaker 2: And in order for that to really work, because lots
• 12:47
  Speaker 2: of people say they're going to do that, but in
• 12:49
  Speaker 2: order for that to really work, you really have to
• 12:51
  Speaker 2: be something that can take energy only a few hours
• 12:54
  Speaker 2: a day. You have to be able to operate at
• 12:57
  Speaker 2: low capacity factor to have a low cost per kilo loot.
• 13:03
  Speaker 2: And I think, as I think I mentioned, the technology
• 13:06
  Speaker 2: we use for capturing electricity is the same one that
• 13:10
  Speaker 2: is in your toaster. It is literally a hot wire
• 13:14
  Speaker 2: and it is difficult to get cheaper than a hot wire.
• 13:17
  Speaker 2: So the bricks, Yeah, these play a unique role in
• 13:21
  Speaker 2: being kind of a bottom feeder that's taking electricity that
• 13:25
  Speaker 2: nobody else wants. That as a result, eliminating curtailment, making
• 13:33
  Speaker 2: renewables that are serving the grid more profitable because they
• 13:37
  Speaker 2: can sell all their energy. This new kind of load
• 13:41
  Speaker 2: is going to transform the grids it's connected to.
• 13:44
  Speaker 1: So curtailment is like turning off solar panels in the
• 13:47
  Speaker 1: middle of the day because there's not enough demand. Basically,
• 13:50
  Speaker 1: that's what curtailment is.
• 13:51
  Speaker 2: Yes, England threw away fifty five percent of the wind
• 13:55
  Speaker 2: power available at the Scotland border last year.
• 13:58
  Speaker 1: You got to put some bricks over there, man, You
• 14:00
  Speaker 1: got to put some hot bricks on the Scotland border. Yeah,
• 14:04
  Speaker 1: so tell me about the pilot plant that you have, right,
• 14:09
  Speaker 1: that's you have built a pilot plant, is that correct.
• 14:12
  Speaker 2: Yeah. We built a first small unit for a customer
• 14:18
  Speaker 2: who is an innovator in producing low carbon biofuels. The
• 14:23
  Speaker 2: goal is a couple of large units that eliminate all
• 14:26
  Speaker 2: the combustion at the refinery, and they said show us.
• 14:32
  Speaker 2: We were keen to work with them in the longer term,
• 14:36
  Speaker 2: and we were also on a journey. We were preparing
• 14:40
  Speaker 2: to build a first commercial unit for another customer that
• 14:45
  Speaker 2: holds one hundred magawatt hours. We had built things in
• 14:49
  Speaker 2: the lab that hold two hundred kilowat hours, and that's
• 14:54
  Speaker 2: too big a step.
• 14:56
  Speaker 1: Right, That's like about a thousandfold leap of five hundredfold.
• 14:59
  Speaker 2: Only five hundred, Yeah, exactly. Yeah, so let's build something
• 15:03
  Speaker 2: in between. And in particular, the work that we had
• 15:07
  Speaker 2: been doing in the lab, we had recognized, Okay, we
• 15:11
  Speaker 2: have the geometry, we have the materials, but we aren't
• 15:15
  Speaker 2: making the thing the way that it's going to be
• 15:17
  Speaker 2: easy to construct. We want to make the core a
• 15:21
  Speaker 2: different way and we want to actually test build something
• 15:25
  Speaker 2: of the full commercial implementation before we go to build
• 15:29
  Speaker 2: a big one, and that was the genesis that said,
• 15:33
  Speaker 2: why we want to do this project, and they over
• 15:36
  Speaker 2: the last year and a half a little more than that.
• 15:39
  Speaker 2: Now we've learned a ton from operating there, from going
• 15:43
  Speaker 2: through catastrophic rainstorms that flooded the site and flooded the substation,
• 15:50
  Speaker 2: and you know, a variety of things that were unpredictable
• 15:53
  Speaker 2: that have been valuable learning experiences as well.
• 15:57
  Speaker 1: So what's it? Just what's it look like?
• 15:59
  Speaker 2: This thing is a It's a box that contains ten
• 16:05
  Speaker 2: tons of brick, storing two megawatt hours of energy. Each
• 16:10
  Speaker 2: brick is about a one meter cube in terms of
• 16:15
  Speaker 2: its size. That has open chambers that in which light
• 16:20
  Speaker 2: moves heat around, and fine slots in the brick through
• 16:25
  Speaker 2: which air passages. It's a complicated looking object, but it's
• 16:30
  Speaker 2: about a meter cube and it weighs about a ton.
• 16:33
  Speaker 2: So I'm sorry about half a ton.
• 16:35
  Speaker 1: Yeah, each each brick, you're saying, each brick.
• 16:43
  Speaker 2: Yeah, A single a single brick.
• 16:45
  Speaker 3: Yeah.
• 16:45
  Speaker 2: So the part of the journey was learning how to
• 16:49
  Speaker 2: make big ones so that the assembly at sight would
• 16:52
  Speaker 2: be very quick. Inside that structure of brick are electrical
• 16:57
  Speaker 2: heaters that are passing through passages. Inside that brick array,
• 17:03
  Speaker 2: it's surrounded by an insulated box which is surrounded by
• 17:06
  Speaker 2: an insulated kind of shed, and it looks like a
• 17:08
  Speaker 2: small all industrial building on the outside. It's got water
• 17:13
  Speaker 2: pipes and steam pipes on one side and an electrical
• 17:16
  Speaker 2: connection at the other.
• 17:20
  Speaker 1: In a minute, John talks about building plants around the
• 17:23
  Speaker 1: world right now. So you have this pilot plant, it's running.
• 17:41
  Speaker 1: What are you worried about? What are you still trying
• 17:45
  Speaker 1: to figure out?
• 17:46
  Speaker 2: Well, today we are in contract and in construction in
• 17:52
  Speaker 2: on two, three, four, five countries on projects making cement, polyester, whiskey, beer, polycarbonate, plastic,
• 18:01
  Speaker 2: and biofuels. We are struggling to grow the company rapidly.
• 18:07
  Speaker 2: We're about one hundred and fifty people in seven countries
• 18:10
  Speaker 2: right now, establishing construction relationships with you know, construction companies
• 18:18
  Speaker 2: for in all of those five countries. There are plenty
• 18:21
  Speaker 2: of things at this point of you know, stretching at
• 18:25
  Speaker 2: the seams. We've just only just a few months ago
• 18:30
  Speaker 2: concluded establishment of a European subsidiary with financing from the
• 18:36
  Speaker 2: European Investment Bank and Breakthrough Energies Project finance team that
• 18:42
  Speaker 2: have created an enormous financial, engineering capability and legal capability
• 18:48
  Speaker 2: inside our company that almost killed us.
• 18:51
  Speaker 1: We uh that bricks are easy finance and legal.
• 18:57
  Speaker 2: Yeah, well, it depends on where you are, but at
• 19:00
  Speaker 2: the moment, yes, that's right, because it was about a
• 19:02
  Speaker 2: year ago that we established a giant manufacturing capacity with
• 19:08
  Speaker 2: one of our early investors, who is a diversified producer
• 19:12
  Speaker 2: of many things, including this refractory brick, doing business in
• 19:16
  Speaker 2: sixty countries. So part of it has been establishing proving
• 19:22
  Speaker 2: the initial that the thing works, then establishing manufacturing capacity,
• 19:27
  Speaker 2: establishing delivery capacity, the ability of finance projects. There's more
• 19:32
  Speaker 2: than one answer to your question depending on what perspective
• 19:35
  Speaker 2: that you look, and right now we're engaged in all
• 19:38
  Speaker 2: of them.
• 19:39
  Speaker 1: So it's execution risk. If I were to reduce what
• 19:42
  Speaker 1: you're saying, it's like you figured out how to do
• 19:44
  Speaker 1: the thing, but doing it is hard, doing it in
• 19:47
  Speaker 1: five countries, and I mean presumably also like the thing,
• 19:55
  Speaker 1: like you have to spend a lot of money now
• 19:57
  Speaker 1: in order to get sort of steady returns over twenty years. Right,
• 20:00
  Speaker 1: that's your model. You're building these things and then you're
• 20:03
  Speaker 1: selling the heat over the life of the thing is
• 20:05
  Speaker 1: that the way it works for.
• 20:07
  Speaker 2: About half of our projects, that is the way it works.
• 20:09
  Speaker 5: OK.
• 20:09
  Speaker 2: But you're right, we're spending a lot of money now
• 20:12
  Speaker 2: and part of what we're doing, of course, these early
• 20:14
  Speaker 2: projects are proving the technology in that place, in that
• 20:19
  Speaker 2: application with that construction partner. So we're setting the grounds
• 20:24
  Speaker 2: for hypergrowth and establishing that bankability criterion that I mentioned earlier.
• 20:30
  Speaker 2: And it takes a lot of work to get the
• 20:32
  Speaker 2: first one done. But if we've done that right with
• 20:35
  Speaker 2: that partner in that country, you know we will step
• 20:38
  Speaker 2: and repeat. And there are these giant markets where we
• 20:42
  Speaker 2: are in the money and there are a lot of
• 20:44
  Speaker 2: people who want to be customer number two or three.
• 20:48
  Speaker 2: But to your point, for some of our projects, we
• 20:52
  Speaker 2: are a technology provider where we are building something and
• 20:56
  Speaker 2: turning the keys over to the customer, and in others
• 21:00
  Speaker 2: we are the owner operator and we are selling energy services,
• 21:03
  Speaker 2: not energy equipment.
• 21:05
  Speaker 1: Basically, you own the bricks or they own the bricks.
• 21:08
  Speaker 1: I mean, are those the two models you're describing.
• 21:11
  Speaker 2: More or less? Yeah, So there are several ways that
• 21:15
  Speaker 2: customers will bring these things in and in some cases
• 21:18
  Speaker 2: it's because look, the heat battery is in the middle
• 21:22
  Speaker 2: of their petrochemical complex. They want to own everything in
• 21:27
  Speaker 2: that square mile factory facility. In other cases, no, we're
• 21:32
  Speaker 2: going to establish something that's right next door and sell
• 21:35
  Speaker 2: steam over the fence. That's just the nature of this business.
• 21:39
  Speaker 2: And we're standing ourselves up to do business the way
• 21:43
  Speaker 2: that the market needs us to.
• 21:45
  Speaker 1: You use the phrase in the money. Does that mean
• 21:49
  Speaker 1: it's cheaper for them to buy heat from you than
• 21:53
  Speaker 1: to use fossil fuel to generate heat? Is that what
• 21:56
  Speaker 1: in the money means in that context?
• 21:57
  Speaker 2: Yes, that's true every single project, and that is yes exactly.
• 22:02
  Speaker 1: Is regulation a problem for you at all? Is it
• 22:05
  Speaker 1: a benefit to you? Like, how does regulation fit with
• 22:07
  Speaker 1: your business?
• 22:09
  Speaker 2: We're using a new fuel, We're using electricity in a
• 22:12
  Speaker 2: fundamentally new way, right, and the rules that the world
• 22:18
  Speaker 2: has around electricity networks need update, you know. And we
• 22:24
  Speaker 2: hear an awful lot about the challenges of connecting renewable
• 22:29
  Speaker 2: generation to electricity grids and the delays, and you know,
• 22:35
  Speaker 2: the sort of structural conflict between we want a least
• 22:39
  Speaker 2: cost electricity network, but we need one that operates with
• 22:43
  Speaker 2: these fundamentally new sources of generation. What's gone on so
• 22:47
  Speaker 2: far with lithium ion batteries in particular, has begun to
• 22:51
  Speaker 2: address the matter of how do we connect these intermittent loads,
• 22:55
  Speaker 2: how do we connect loads that benefit the electricity grid?
• 22:59
  Speaker 2: And this matter is a very big deal country by country.
• 23:03
  Speaker 2: Netherlands just made a rules change, Denmark made a rules
• 23:06
  Speaker 2: change in April last year. We had a project contracted
• 23:10
  Speaker 2: in October. Germany and England have just made rules changes.
• 23:15
  Speaker 2: In some places, the rules like in Urkat in Texas
• 23:19
  Speaker 2: already work. I'm speaking to you from California, where decarbonization
• 23:23
  Speaker 2: is both mandatory and forbidden. The grid rules in California
• 23:28
  Speaker 2: make it impossible to connect projects like ours, and we're
• 23:33
  Speaker 2: building our next California project with no connection at all
• 23:36
  Speaker 2: at all to the electricity grid.
• 23:38
  Speaker 1: For that reason, basically just because they wouldn't let you
• 23:41
  Speaker 1: if you wanted to.
• 23:42
  Speaker 2: Well, and it was going to take seven years to
• 23:44
  Speaker 2: get a connection, and the price would the price of
• 23:47
  Speaker 2: the grid service alone exceeds the cost of fuel, so
• 23:51
  Speaker 2: that even if the solar energy were free, the economics
• 23:56
  Speaker 2: could not work. So yeah, there are places where the
• 24:01
  Speaker 2: rules matter, and it is mostly a matter of sort
• 24:05
  Speaker 2: of modernizing the rules to sort of deal with today's
• 24:11
  Speaker 2: these fundamentally new technologies that were not conceived when today's
• 24:15
  Speaker 2: rules were established. Steve chu who was Obama's Energy secretary
• 24:20
  Speaker 2: after he won the Nobel Prize, you know, he used
• 24:23
  Speaker 2: to go around giving a talk saying, the United States
• 24:26
  Speaker 2: does electricity today the way we did roads in nineteen
• 24:29
  Speaker 2: thirty nine. And he's right about interstate transmission and all
• 24:35
  Speaker 2: sorts of things. But these things are being worked at
• 24:39
  Speaker 2: the same time as our technology and others are coming
• 24:43
  Speaker 2: to the fore. Because look, five ten years from now,
• 24:47
  Speaker 2: I think it'll be widely understood that all of industry
• 24:51
  Speaker 2: is going to be repowered on electricity, electrify everything is
• 24:56
  Speaker 2: the way we make this transition to a lower cost
• 25:00
  Speaker 2: world that is zero emission. And I'm very encouraged that
• 25:06
  Speaker 2: that process is underway and a bunch of places, and
• 25:10
  Speaker 2: there are different pieces to get out of the way
• 25:12
  Speaker 2: and to enable that transition on that journey, and I'm
• 25:17
  Speaker 2: delighted that, you know, there are other folks building heat
• 25:20
  Speaker 2: batteries and heat pumps and electoralizers and all sorts of
• 25:24
  Speaker 2: things that collection, as well as electrochemical batteries that collection.
• 25:29
  Speaker 2: Those technologies, the winners will find their way to scale,
• 25:35
  Speaker 2: but these regulatory matters need to be adjusted for any
• 25:38
  Speaker 2: of them to deploy.
• 25:43
  Speaker 1: We'll be back in a minute with the lighting ground.
• 25:58
  Speaker 1: Are tandem bicycles overrated or underrated?
• 26:02
  Speaker 2: I have three in my backyard. Tandem bicycles are fantastic.
• 26:06
  Speaker 1: Why has the world not come to their bicycles? What
• 26:10
  Speaker 1: do you know that nobody else knows.
• 26:14
  Speaker 2: Most of my rides have been with my kids, especially
• 26:17
  Speaker 2: when my kids were younger. It was a way of
• 26:19
  Speaker 2: doing centuries when you know they weren't willing to ride
• 26:22
  Speaker 2: love liscences.
• 26:23
  Speaker 1: You peddled one hundred miles and they coasted.
• 26:27
  Speaker 2: It wasn't like that, but there were allegations of that
• 26:30
  Speaker 2: at different times. Who sat him back? My kids? But
• 26:36
  Speaker 2: you know, my wife isn't as excited about tandem bicycles
• 26:39
  Speaker 2: as I am, so I understand there's a diversity of
• 26:41
  Speaker 2: opinions on this topic. I've read that.
• 26:45
  Speaker 1: You're also a pilot, and I saw a quote from
• 26:48
  Speaker 1: someone who once flew with you, and they called flying
• 26:52
  Speaker 1: with you. You know what I'm going to say. They
• 26:53
  Speaker 1: called it one of the scariest and most exhilarating flights
• 26:57
  Speaker 1: I've ever had. And I just want to give you
• 27:00
  Speaker 1: a chance a comment on that.
• 27:02
  Speaker 5: Yeah, we were on our way to a particular site
• 27:05
  Speaker 5: where to a meeting where we're going to go testify
• 27:08
  Speaker 5: against the construction action of a coal plant in a
• 27:11
  Speaker 5: particular spot, and we chose a route that went fairly
• 27:14
  Speaker 5: close to a peak on our way there in Nevada.
• 27:17
  Speaker 1: And because it was a straight line, you were just like, well,
• 27:21
  Speaker 1: let's go on a street.
• 27:21
  Speaker 2: Were just level. We were, I don't know, a mile away,
• 27:25
  Speaker 2: but we were level with the peak. And he liked that,
• 27:29
  Speaker 2: or he both got excited and terrified.
• 27:31
  Speaker 3: Yeah.
• 27:32
  Speaker 1: So you worked on nuclear fusion long ago and people
• 27:38
  Speaker 1: are still working on nuclear fusion. Do you think it'll
• 27:41
  Speaker 1: ever work in a meaningful way? You think the economics
• 27:46
  Speaker 1: of it will ever make sense? Even if we figure
• 27:48
  Speaker 1: out the science.
• 27:50
  Speaker 2: There are people who know much more about it than
• 27:52
  Speaker 2: I do. That you should ask that question. I was
• 27:54
  Speaker 2: building computer systems for the instrumentation group. But every problem
• 28:02
  Speaker 2: that existed, every single one of the horrific material science challenges, whatevers.
• 28:10
  Speaker 2: There are very smart folks working on those things. But
• 28:13
  Speaker 2: you ask the right question, is there a chance that
• 28:16
  Speaker 2: it will be economical? Given what's going on in energy storage?
• 28:21
  Speaker 2: Right that the world has consistently underpredicted how fast that
• 28:25
  Speaker 2: would come down in cost. That we have consistently underpredicted
• 28:29
  Speaker 2: how fast wind and solar come down in cost. It's
• 28:33
  Speaker 2: very difficult to see how fusion will compete with free
• 28:39
  Speaker 2: and of course baseload technologies that can deliver us energy
• 28:42
  Speaker 2: all the time are super attractive, but you have to
• 28:45
  Speaker 2: look at the whole system. And again there are people
• 28:48
  Speaker 2: who know much more about that than I do.
• 28:51
  Speaker 1: What's one thing about energy at any level could be
• 28:55
  Speaker 1: on the level of basic physics or not that you
• 28:57
  Speaker 1: wish everybody knew.
• 29:01
  Speaker 2: We can have this energy transition that we talk about
• 29:07
  Speaker 2: right now, and it is the greatest business opportunity of
• 29:12
  Speaker 2: our lifetime, and we have the technologies to do about
• 29:20
  Speaker 2: eighty percent of what we need to do, and the
• 29:23
  Speaker 2: technologies basically are at hand. You know, we have the
• 29:28
  Speaker 2: tools to drive through this transition. And ten and twenty
• 29:32
  Speaker 2: years ago, there was this belief that the green transition,
• 29:36
  Speaker 2: for example, the energy transition, was going to make us
• 29:38
  Speaker 2: all poorer, that it was going to be a burden
• 29:41
  Speaker 2: to those in developing countries, that it was going to
• 29:44
  Speaker 2: you know, take away wealth. And we are now at
• 29:48
  Speaker 2: this moment where the thing I wish people knew was that, look,
• 29:52
  Speaker 2: these technologies are cheaper and we can go faster, and
• 29:58
  Speaker 2: there are spectacular opportunities to drive change and go faster
• 30:04
  Speaker 2: than the world needs to to achieve Paris and a
• 30:08
  Speaker 2: safer client And most people don't know that. There is
• 30:12
  Speaker 2: a sense I hear often kind of a sense of hopelessness.
• 30:16
  Speaker 2: There's nothing we can do. It's going to take longer
• 30:18
  Speaker 2: than we want. And it's like, guys, we just put
• 30:21
  Speaker 2: our heads together. We have the tools to do this.
• 30:26
  Speaker 2: It's profitable to do this. Let's get to it.
• 30:36
  Speaker 1: John O'Donnell is the co founder of Rondo Energy. Next
• 30:40
  Speaker 1: week i'll talk with Raffi Garabedian, co founder of Electric Hydrogen.
• 30:45
  Speaker 1: Raffi's company has raised hundreds of millions of dollars and
• 30:48
  Speaker 1: it's trying to turn all of that cheap intermittent energy
• 30:51
  Speaker 1: from solar and wind power into hydrogen. That hydrogen could
• 30:55
  Speaker 1: be used for everything from making fertilizer to powering container ships.
• 31:03
  Speaker 1: Today's show was produced by Gabriel Hunter Chang. It was
• 31:06
  Speaker 1: edited by Lydia gene Kott and engineer by Sarah Bruguer.
• 31:10
  Speaker 1: You can email us at Problem at Pushkin dot Fm,
• 31:14
  Speaker 1: I'm Jacob Bothstein and we'll be back next week with
• 31:16
  Speaker 1: another episode of What's Your Problem.