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Harnessing the Heat Deep Beneath Our Feet · What's Your Problem?

0:15
Speaker 1: Pushkin. Here's the standard story of the energy transition. To
0:24
Speaker 1: get to our post carbon future. We just need some
0:27
Speaker 1: combination of wind and solar power plus energy storage plus
0:33
Speaker 1: nuclear power. Those together ought to do it. That's a
0:36
Speaker 1: story I've told on this show. It's a story lots
0:38
Speaker 1: of people have told on lots of shows. But I
0:42
Speaker 1: recently talked to a guy named Carlos Arake who made
0:47
Speaker 1: a compelling case that this story is not true, that
0:51
Speaker 1: it's not going to work for a variety of reasons, technical, economic, political,
0:56
Speaker 1: Wind and solar plus storage plus nuclear are just going
1:00
Speaker 1: to be too slow to build, too inefficient, too politically
1:03
Speaker 1: complex to deliver all the carbon free energy that the
1:07
Speaker 1: world needs. Or Carlos has another idea. It's kind of
1:12
Speaker 1: out there, but he's raised a lot of money to
1:14
Speaker 1: do it. His idea is this, shoot a high energy
1:18
Speaker 1: beam down into the ground until we've dug a hole
1:22
Speaker 1: eight inches wide and twelve miles deep. Basically, he wants
1:28
Speaker 1: to reinvent geothermal energy. He wants to harvest the heat
1:32
Speaker 1: energy that's just sitting down there all over the world
1:36
Speaker 1: waiting for us to get it. He says, if he
1:38
Speaker 1: can figure out how to do that, you know, cheaply, efficiently,
1:41
Speaker 1: at scale, our energy problems will be solved. But nobody
1:46
Speaker 1: has ever dug a hole nearly this deep. Carlos's own
1:50
Speaker 1: company hasn't started drilling deep wells yet, and so the
1:53
Speaker 1: whole project is, you know, at this point something of
1:55
Speaker 1: a long shot. Still, Carlos and his colleagues have raised
1:59
Speaker 1: somewhere around one hundred million dollars, and if they succeed
2:03
Speaker 1: in what they're trying to do, it will infect be
2:05
Speaker 1: this incredible new source of clean energy. I'm Jacob Goldstein,
2:16
Speaker 1: and this is What's Your Problem? The show where I
2:18
Speaker 1: talk to people who are trying to make technological progress.
2:21
Speaker 1: My guest today is Carlos Arake. He's the co founder
2:24
Speaker 1: and CEO of Quay's Energy. Carlos's problem is this, how
2:29
Speaker 1: do you make drilling for geothermal energy as routine and
2:33
Speaker 1: widespread and profitable as drilling for oil or natural gas.
2:38
Speaker 1: Carlos knows in great detail how routine and widespread and
2:42
Speaker 1: profitable drilling for oil and gas is because he spent
2:45
Speaker 1: the first fifteen years of his career working at Schlumberge,
2:48
Speaker 1: a giant firm that provides services to oil and gas
2:51
Speaker 1: companies and to start. I asked Carlos how he made
2:55
Speaker 1: the leap from working at this one hundred year old
2:57
Speaker 1: company in the fossil fuel business to starting a company
3:00
Speaker 1: that's trying to move the world off of fossil fuel.
3:05
Speaker 2: I think it goes back to much before I quit.
3:11
Speaker 2: I quit in twenty seventeen, and I think I can
3:13
Speaker 2: remember as far back as twenty ten, when I started
3:17
Speaker 2: to become very familiar with the oil industry, the amount
3:21
Speaker 2: of energy we use as a civilization, how it's growing
3:23
Speaker 2: over time, when I started thinking about what it would
3:27
Speaker 2: take to transition away from fossil fuels.
3:31
Speaker 1: So like, in a way, working in the fossil fuel industry,
3:35
Speaker 1: it gave you an appreciation for how hard it will
3:38
Speaker 1: be to transition away from fossil fuels.
3:41
Speaker 2: Very much so, very much.
3:43
Speaker 1: So.
3:43
Speaker 2: It's just the sheer numbers how much energy it takes
3:46
Speaker 2: to power humanity today. It's just an awakening moment to say, Okay,
3:53
Speaker 2: there's no way we're going to be able to do
3:56
Speaker 2: this with wings, solar batteries, hydro nuclear, etcetera, etcetera. So
4:02
Speaker 2: that's when the search started. It had to be something
4:06
Speaker 2: at the scale of oil and gas, and it had
4:12
Speaker 2: to be something that solved for the environmental challenge, but
4:17
Speaker 2: also other challenges geopolitical, socio economic and environmental emissions, land use,
4:26
Speaker 2: mineral use, all of those things need to be sold for.
4:30
Speaker 2: And I wasn't seeing anything on the landscape at all.
4:33
Speaker 2: So that's the beginning of that inkling.
4:35
Speaker 1: And when was that?
4:36
Speaker 2: When was it that you left? So I think I
4:38
Speaker 2: was living in Norway at the time. I was working
4:40
Speaker 2: for somebody in Norway, and that's when I started thinking
4:44
Speaker 2: about these things, mostly seeing, you know, reflecting on a
4:47
Speaker 2: country like Norway, how prosperous it is, and where that
4:50
Speaker 2: prosperity comes from. Oil, which is.
4:52
Speaker 1: Oil oil and good institutions. Right, they have a lot
4:55
Speaker 1: of oil and they have like very robust civil institutions.
4:59
Speaker 1: A rare combination.
5:01
Speaker 2: Oh yeah, it's a very blessed combination, you know. So
5:04
Speaker 2: that got me thinking about those things, you know, and
5:07
Speaker 2: living in there, not not just working, but living living
5:09
Speaker 2: in the country, being a direct beneficiary of that way
5:15
Speaker 2: of doing things. What's the beginning of that? You know?
5:19
Speaker 2: And that country's pristine, is so beautifully pristina. I said, Okay,
5:23
Speaker 2: these guys are doing something really, really right. What's behind that.
5:27
Speaker 2: So that's the beginning of that search of how much energy?
5:30
Speaker 2: How do we do it? It's not just about emissions,
5:33
Speaker 2: it's about many other things. But it took seven years
5:38
Speaker 2: to develop the deep conviction and to get my families,
5:45
Speaker 2: you know, complicity in quitting Stormagy.
5:48
Speaker 1: Because like, you had a good job, you p absume
5:51
Speaker 1: you were paid well, you could work there your whole life.
5:54
Speaker 2: Absolutely, it's I have nothing bad to say about my
5:59
Speaker 2: years there. It's nothing but good experiences, good colleagues, good problems,
6:03
Speaker 2: never boring. So it really came from a very deep
6:07
Speaker 2: conviction of trying to you know, I call it using
6:11
Speaker 2: the second part of my career to actually push in
6:16
Speaker 2: what I think needs to be the direction that the
6:19
Speaker 2: world needs to go into. And don't get me wrong,
6:21
Speaker 2: I don't think fossil fueler girt is a beer anytime soon.
6:23
Speaker 2: But we need to start pushing in a new direction.
6:27
Speaker 2: And I wasn't seeing anything able to do that.
6:32
Speaker 1: So you go and work at the venture capital fund
6:36
Speaker 1: of MIT, your alma mater, in your in your search, right,
6:39
Speaker 1: you're you're now you're on your quest. When you get there,
6:45
Speaker 1: I mean, are you sort of in your mind explicitly
6:48
Speaker 1: or implicitly be like, Okay, I'm gonna go try and
6:50
Speaker 1: find it. I'm gonna go try and find some solution
6:52
Speaker 1: to our energy problem. Is that?
6:54
Speaker 2: Is that what's happening? I think it is? It is
6:59
Speaker 2: like that. Indeed, I quitch lanu Ja without having a job.
7:04
Speaker 2: You know, on principle I said, look, I'm just I
7:07
Speaker 2: need to get out of here to reinvent myself. Is
7:10
Speaker 2: too comfortable to stay in that job. Yeah, so you
7:13
Speaker 2: will always postpone it. So we came back. We were living
7:17
Speaker 2: in England as a family, my wife and three kids,
7:19
Speaker 2: and I decided that I had already decided that energy
7:25
Speaker 2: transition was a technological problem first, and if successful, if bridged,
7:35
Speaker 2: could become in a socio economical, geopolitical and all of
7:38
Speaker 2: the other things. Regulatory problem, but technological problem first, we
7:42
Speaker 2: don't have the technologies to transition away from fossil fuels.
7:46
Speaker 1: And what year ish is this?
7:49
Speaker 2: When did you say twenty seventeen?
7:51
Speaker 1: So by twenty seventeen solar powers is already getting much
7:56
Speaker 1: cheaper with the Mayan batteries are still expensive, but they're
8:00
Speaker 1: starting to get cheaper. Like people are very excited about
8:05
Speaker 1: those technologies at that time, like, what's your what's your
8:09
Speaker 1: view on them?
8:12
Speaker 2: So I think they will play a part in the solution,
8:18
Speaker 2: but I think they will play a very small part
8:21
Speaker 2: in the solution.
8:22
Speaker 1: And if you take solar and wind and nuclear, to
8:26
Speaker 1: take the three sort of classic modern classic renewables, like
8:31
Speaker 1: those seem pretty compelling plus storage as a package. To me,
8:35
Speaker 1: you're clearly less compelled by those as a package.
8:38
Speaker 2: Why so it has to do with the premiums we
8:42
Speaker 2: incur in transitioning a unit of fossil energy to a
8:49
Speaker 2: unit of clean energy from either one of those sources.
8:53
Speaker 1: So when you say premium, do you mean cost? By
8:55
Speaker 1: different definitions of the word cost, What does premium mean
8:58
Speaker 1: when you use it that way?
8:58
Speaker 2: Yeah, I define premium as multiple things. So land use
9:05
Speaker 2: per unit of energy, that's one mineral U per unit
9:09
Speaker 2: of energy, that's two and man hours labor use per
9:16
Speaker 2: unit of energy. And I frame it like that simply
9:20
Speaker 2: because these are the resources we have available to us.
9:24
Speaker 2: You know, think about it. We have time, space, and stuff. Basically, actually,
9:29
Speaker 2: I say four things. There's time, there's place, there's natural resources,
9:34
Speaker 2: and there's nohow that's it. Those are the resources everything
9:38
Speaker 2: else derives from that.
9:40
Speaker 1: It's like land, labor, capital, and ideas. Right, it's like
9:43
Speaker 1: kind of econ one oh one ish.
9:46
Speaker 2: That's right. That's right. So you cannot pretend that you
9:51
Speaker 2: can replace twenty five trillion juice per second, which is
9:54
Speaker 2: what it takes to power humanity, if in doing so
9:59
Speaker 2: you're incurring a one hundred x to one thousand x
10:02
Speaker 2: on any of those things. You know, a unit of
10:06
Speaker 2: fossil energy takes a certain amount of space, land, a
10:12
Speaker 2: certain amount of minerals, a certain amount of labor to
10:14
Speaker 2: pull together, to bring together, and if you try to
10:17
Speaker 2: do it with solar, that multiplies by about one hundred in.
10:20
Speaker 1: Terms of the space in particular.
10:22
Speaker 2: Yes, it takes one hundred times more land, it takes
10:26
Speaker 2: one hundred times to a thousand times more minerals, depending
10:29
Speaker 2: on a mineral, and it takes one hundred to a
10:31
Speaker 2: thousand times more man hours.
10:34
Speaker 1: To install and versus installing and recovering fossils.
10:38
Speaker 2: All things consider and implicitly, and there is cost, But
10:42
Speaker 2: cost is deceptive because you can always make up economic
10:47
Speaker 2: models and capital cost models to actually bring those casts down.
10:51
Speaker 2: We can talk about cost in a second, but the
10:53
Speaker 2: bring it more fundamentally, that is that realization. That and
10:57
Speaker 2: the same applies for wind, and the same applies for
11:00
Speaker 2: pretty much everything that's renewable, diffuse and intermittent. We cannot
11:05
Speaker 2: move a jewel or a what of fossil energy to
11:10
Speaker 2: the clean space to the emission space, you know, bonus
11:14
Speaker 2: points for lower emissions by incurring one hundred to one
11:17
Speaker 2: thousand eggs more costs on land use, mineral use, on
11:20
Speaker 2: labor use per unit of energy. That's not scalable. The
11:22
Speaker 2: externalities will stop it on its tracks. Uh huh.
11:26
Speaker 1: Like even though it's so much cheaper to make solar
11:29
Speaker 1: panels now there sort of will be land use. Just
11:32
Speaker 1: in practical political terms, people won't let us put all
11:38
Speaker 1: the solar panels we need to generate the energy. I mean,
11:41
Speaker 1: is it that kind of problem.
11:42
Speaker 2: Yeah, we won't be able to afford the land use
11:44
Speaker 2: for that. I mean, forget about people letting it be
11:46
Speaker 2: that that's going to happen, but we just won't have
11:48
Speaker 2: the land budget to do it. Because we also need
11:51
Speaker 2: to use land for other things like preserving environmental forests,
11:55
Speaker 2: right to like feeding ourselves, you know, and people always
11:59
Speaker 2: say like, oh, we can put this stuff in the Sahara.
12:01
Speaker 2: Sure you can, but it's still intermittent and the energy
12:03
Speaker 2: is they're not here. Yeah, So there's this fallacy that
12:07
Speaker 2: because you can take energy from somewhere, sometimes you can
12:11
Speaker 2: put it everywhere all the time. That is the biggest fallacy.
12:15
Speaker 1: I mean people are trying to solve that. I know
12:17
Speaker 1: that adds costs, right, but like by some come actually
12:21
Speaker 1: building building wires.
12:23
Speaker 2: That is the cost. That is the cost. So people
12:25
Speaker 2: say WIN and SOT are cheap. Lie, the collection of
12:29
Speaker 2: those resources is cheap. But building those into and the
12:33
Speaker 2: fixed costs required to bring that energy everywhere all the time,
12:36
Speaker 2: these where the true cost takes. You know, the cost
12:39
Speaker 2: is not in collecting the energy. The cost is in
12:41
Speaker 2: moving it and storing it. And it's massive, massive, massive.
12:46
Speaker 2: I mean, so if you're as an engineer think about
12:47
Speaker 2: those and you say, look, this is this is not
12:50
Speaker 2: going to get us anywhere close to where we need
12:53
Speaker 2: to be. Fine, they'll play a solution, there's markets for that.
12:56
Speaker 2: People will money, capitalism will play its role. But at
12:59
Speaker 2: some point those externalities will smack you in the face
13:02
Speaker 2: and it's happening. It's happening. You can see it already
13:05
Speaker 2: happening in some places with the penetration. So I don't
13:08
Speaker 2: believe and this is not faith. This is not believe
13:12
Speaker 2: us in faith. This is believe us in quantitative rigors
13:15
Speaker 2: engineering analysis that those things will actually get us to
13:19
Speaker 2: where we need to go.
13:21
Speaker 1: What about nuclear power.
13:23
Speaker 2: Or nuclear can totally do it? Absolutely? Nuclear does not
13:26
Speaker 2: incur those premiums. But nuclear has a different problem. From Colombia.
13:32
Speaker 2: We have oil. We barely have a refinery in the country.
13:36
Speaker 2: Why is that because of value change them because of geopolitics.
13:40
Speaker 2: So don't tell me that we will be happy to
13:45
Speaker 2: ship radioactive fuel, refine radioactive fuel, and ship back radioactive
13:50
Speaker 2: ways on a global scale. We can barely do that
13:54
Speaker 2: with oil and gas.
13:56
Speaker 1: In particular, you're saying the raw material, the uranium say
14:02
Speaker 1: that you need to make nuclear power doesn't exist in
14:06
Speaker 1: lots of places, and the notion that there will be
14:08
Speaker 1: some kind of globe supply chains shipping uranium around the
14:11
Speaker 1: world is implausible' that's the core argument you're making.
14:14
Speaker 2: Yeah, and that's just the raw material. The raw matill
14:16
Speaker 2: is a simpler problem. It's just the problem of carrying
14:19
Speaker 2: a lot of things from point to point B. I'm
14:22
Speaker 2: more concerned actually about the refined form of that shipping
14:28
Speaker 2: and rich radioactive materials fuel grade not weapon grade fuel
14:32
Speaker 2: greade radioactive material to fuel the power plant. You know, worldwide,
14:37
Speaker 2: into economies that cannot even control themselves, into very very
14:42
Speaker 2: trouble geopolitical systems that cannot even govern themselves. This is
14:46
Speaker 2: not going to happen at scale. I think nuclear is
14:49
Speaker 2: a solution for the G twenty, but not much beyond
14:53
Speaker 2: that because of the geopolitics, not because of the technological
14:56
Speaker 2: arguments I made about win and solar.
14:58
Speaker 1: The G twenty, the twenty basically richest countries in.
15:02
Speaker 2: The world essentially, that's right. That is correct.
15:05
Speaker 1: Okay, so you've you've set You've set the table. This
15:10
Speaker 1: is what you're thinking about When you leave Schlumberge and
15:12
Speaker 1: you're going out looking for the solution that nobody has found.
15:15
Speaker 1: You go to mi T good place to look what
15:21
Speaker 1: happens when you get there.
15:23
Speaker 2: So I got there because I heard about a new
15:28
Speaker 2: venture fund being launched by MIT timing. Just I didn't
15:35
Speaker 2: plan it that way, It just happened that way. Som
15:38
Speaker 2: T was telling the world, Look, the big problems of
15:40
Speaker 2: the world are not being solved because capitalism is distracted
15:47
Speaker 2: with the near term and little opportunities. So they created
15:49
Speaker 2: a fund, the Engine, they called it, to incentivize the
15:54
Speaker 2: transition of bold ideas from lab to a commercial life.
16:00
Speaker 2: So I went into that environment and I started pitching
16:04
Speaker 2: the engine. You know, you know, I let me be
16:06
Speaker 2: part of these I want to I want to work
16:09
Speaker 2: here because I want to learn venture capital. And the
16:12
Speaker 2: reason I did that is because if it's a technological solution,
16:18
Speaker 2: only venture capital of that kind is going to allow
16:22
Speaker 2: it to flourish outside of the confines and politics of
16:28
Speaker 2: large corporations like SMOG. I was amiliar with that. You
16:31
Speaker 2: saw the limits, you saw the limits of what legacy
16:34
Speaker 2: companies could or would. That's right. The opportunity cost is
16:37
Speaker 2: too hire for them to encourage. Their stakeholders don't allow it.
16:41
Speaker 2: They do research and development, but not of the kind
16:43
Speaker 2: required to bring forth.
16:46
Speaker 1: They're not in that business. They're not in that business.
16:49
Speaker 2: Christians and innovator's dilemma like why would they do that? Yes,
16:54
Speaker 2: their capital cause their opportunity costs doesn't allow them to.
16:58
Speaker 2: So that was my conclusion. Venture capital might do these,
17:02
Speaker 2: especially of the kind the Engine was proposing. MIT was proposed,
17:06
Speaker 2: not any venture capital, because a lot of it is
17:08
Speaker 2: very short temper sure, So okay, So that was the
17:12
Speaker 2: journey there. I said, okay, let me be here. I
17:14
Speaker 2: want to learn venture capital, not because I want to
17:16
Speaker 2: be an investor, but because I want to see how
17:20
Speaker 2: that game is played, how you pitch an investor in
17:23
Speaker 2: venture capital, and in return, I can help you with
17:26
Speaker 2: these companies that are coming out of the labs to
17:28
Speaker 2: figure out commercialization pathways and I can do diligence. We
17:33
Speaker 2: did that for a year to the day. So that
17:36
Speaker 2: was that transition, and then one day you meet a guy.
17:42
Speaker 2: The first week there by the way, the first week there,
17:45
Speaker 2: it's funny. So I joined in July first, twenty seventeen,
17:49
Speaker 2: and I think that week, that very week or the
17:51
Speaker 2: week after, Paul Oskov walked in with Aaron Mandel saying, Hey,
17:57
Speaker 2: here's this idea. We need to pitch the engine. And
17:59
Speaker 2: I was the investor representing the investor on the other
18:02
Speaker 2: side of that conversation.
18:05
Speaker 1: The skeptic, the person saying, why should we give you money?
18:08
Speaker 2: Yes, yes, yes, speitch me.
18:11
Speaker 1: Why so who are these people?
18:14
Speaker 2: Paul is a career long research engineer at MIT, particularly
18:21
Speaker 2: the Plasma Science Fusion Center.
18:23
Speaker 1: Fusion as in everybody's favorite dream for how to get
18:27
Speaker 1: nuclear energy. If we could ever figure it out, it
18:30
Speaker 1: would be amazing. But nobody still that fusion.
18:34
Speaker 2: That fusion which is also a solution. But I can
18:36
Speaker 2: give you a few pointers why I don't think that's
18:39
Speaker 2: going to do anything in our lifetimes. But that's another conversation.
18:41
Speaker 2: So that's that's Paul was. Then Aaron Mandale is a
18:46
Speaker 2: serial entrepreneur. He likes to start companies. He's a good scout,
18:51
Speaker 2: and he was looking for solutions in the geothermal space
18:55
Speaker 2: and he had concluded that drilling deeper and harder was
19:00
Speaker 2: a really, really, really important part of the equation.
19:03
Speaker 1: So there's an entrepreneur who has the idea of drilling
19:07
Speaker 1: deeper for geothermal energy. What's he doing with a guy
19:11
Speaker 1: who studies fusion, Like, what's going on there?
19:16
Speaker 2: Paul had been since two thousand and seven, been playing
19:22
Speaker 2: with very many of the technologies that are used in fusion,
19:26
Speaker 2: but to drill, you know, he was playing with gyrotrons
19:30
Speaker 2: and wave guides and energy beams. But that's still two
19:33
Speaker 2: years before they I even met them as the investor
19:36
Speaker 2: on the other side of the table.
19:38
Speaker 1: So okay, so these guys have been working together. They
19:41
Speaker 1: walk into the room, your brand new what's their pitch?
19:49
Speaker 2: Their page is very much about drilling hotter and deeper
19:53
Speaker 2: with energy to unlog geodermal energy at a very large scale.
19:59
Speaker 2: They wanted money to form that company. They wanted money
20:03
Speaker 2: to start that journey. And I was listening on the
20:08
Speaker 2: other side and saying, Okay, this makes sense, sounds far fetched.
20:15
Speaker 2: I need to become familiar with these technologies which are
20:19
Speaker 2: not using oil and gas. And I was saying, you know,
20:21
Speaker 2: but if it works, it really changes everything. But you're
20:25
Speaker 2: not pitching me a company. You're pitching me a research project.
20:28
Speaker 2: You're pitching me a continuation of the ten years of
20:31
Speaker 2: academic work. And this is a venture capital fund. We
20:33
Speaker 2: need to see a company, and we need to see
20:36
Speaker 2: a founding team.
20:38
Speaker 1: On a really basic level. Like you're saying hotter and deeper,
20:42
Speaker 1: but like what is the very basic idea about hotter
20:47
Speaker 1: and deeper? Like what is sort of status quo geothermal energy?
20:50
Speaker 1: And then how is this idea different?
20:53
Speaker 2: Yeah, so geothermal energy is relatively shallow. It's no more
20:59
Speaker 2: than half a mile maybe a mile into the earth.
21:03
Speaker 2: And to put that into perspective, oil and gas routinely
21:06
Speaker 2: goes beyond that. They go to two miles maybe three
21:09
Speaker 2: miles down.
21:12
Speaker 1: So, in addition to the fact that geothermal energy as
21:15
Speaker 1: it exists now, not only when you're being pitched, but
21:18
Speaker 1: still today, right, it's it's not that deep, and also
21:23
Speaker 1: it's fairly limited in where people can do it right
21:27
Speaker 1: by the nature of what exists a mile or less
21:31
Speaker 1: under the earth.
21:32
Speaker 2: That is correct, it's very geographically constrained. But funny enough,
21:37
Speaker 2: if you look at those places they do amazing things
21:42
Speaker 2: with geothermal, like Iceland and Kenya, they power themselves. They're
21:45
Speaker 2: almost you know, Kenny is like fifty percent electricity from geothermal,
21:49
Speaker 2: Iceland is like thirty percent electricity, like eighty percent heat.
21:53
Speaker 1: And in those places, like at least in Iceland, the
21:55
Speaker 1: heat is coming up out of the ground itself almost right, Like.
22:00
Speaker 1: I mean, I'm sure they're clever engineers and doing lots
22:02
Speaker 1: of work, but when the heat is literally like bubbling
22:06
Speaker 1: out of the ground, it seems a lot easier to cap.
22:09
Speaker 2: It's a lot easier, it's technologically possible, and it's economically feasible.
22:13
Speaker 2: So that's why they exist there. Yeah, So that's the
22:17
Speaker 2: status school of geothermal today.
22:19
Speaker 1: And what happens if you go deeper just on a
22:21
Speaker 1: basic geological.
22:23
Speaker 2: Level, so it's very simple. You just access that same
22:27
Speaker 2: heat no matter where you are in the world. If
22:30
Speaker 2: you go deeper, you can move away from Iceland and
22:34
Speaker 2: you can access the same energy source, which happens to
22:37
Speaker 2: be everywhere but at different depths.
22:41
Speaker 1: So everywhere is Iceland if you go deep enough.
22:44
Speaker 2: Everywhere is Iceland if you from a geothermal point of view,
22:48
Speaker 2: if you go deep enough, indeed, uh huh.
22:52
Speaker 1: And so I mean in the world now, I mean
22:55
Speaker 1: Iceland is kind of the classic, and Kenya is pretty
22:58
Speaker 1: well known overall. What's the Where is geothermal with current
23:03
Speaker 1: technology economically feasible?
23:07
Speaker 2: It's very small because of the geographical limitation. To give
23:11
Speaker 2: you a sense, not even point five percent of energy
23:14
Speaker 2: zero point five one half of one percent of global
23:18
Speaker 2: energy comes from geothermal. And that's because it's geographically constrained.
23:24
Speaker 1: Huh. Basically in most places you have to go too
23:27
Speaker 1: far down to get to the to get to the
23:30
Speaker 1: kind of heat you need.
23:32
Speaker 2: That is correct. That is correct. So that's why it's constrained.
23:35
Speaker 1: Why can't you just keep drilling, like, why can't you
23:38
Speaker 1: just do what they're doing in places where they do
23:39
Speaker 1: it and just go farther down.
23:43
Speaker 2: You can, and people have. It's just very expensive. The
23:47
Speaker 2: drilling operation takes over the economics of anything.
23:53
Speaker 1: Is it nonlinear in some way? Like? Is it that
23:56
Speaker 1: very much deeper you go, the more expensive each marginal
24:00
Speaker 1: meter is?
24:01
Speaker 2: Yes, So you start at hundreds of dollars per meter,
24:06
Speaker 2: and you could very well end up in tens of
24:09
Speaker 2: thousands of dollars per meter. Why one hundred x because
24:12
Speaker 2: your drill bits where and you have to replace them,
24:16
Speaker 2: and if you're very deep down there, it takes a
24:20
Speaker 2: lot more time to replace the drill bit.
24:22
Speaker 1: To pull it up. Time you got to pull it up.
24:25
Speaker 2: Pull it out, change the drill bit, pull it back,
24:27
Speaker 2: and push it back in and then drill for that
24:30
Speaker 2: is such an amazingly simple but seemingly impossible to solve
24:35
Speaker 2: problem because that rog and that temperature kills the drill
24:39
Speaker 2: bits in hours in hours, not even days in hours.
24:42
Speaker 1: So the farther down you as it gets hotter, the
24:45
Speaker 1: drill bit wears out faster, and the farther down you
24:47
Speaker 1: want to get hotter. So it's sort of a problem.
24:49
Speaker 2: That's right. There's another problem is that at some point
24:52
Speaker 2: you can't even get the energy down to the drill bit.
24:54
Speaker 2: Like you're on the surface rotating the drill string and
24:58
Speaker 2: all of that energy is lost on the way there,
25:00
Speaker 2: so the drill bit is barely scratching the surface at
25:03
Speaker 2: some point.
25:05
Speaker 1: So this is the status quo when these guys walk
25:08
Speaker 1: into the room, just in basic terms, like what is
25:12
Speaker 1: their idea?
25:14
Speaker 2: The idea is we can use energy and nothing but energy,
25:21
Speaker 2: no drill to do the work that the drill bit does.
25:24
Speaker 2: No drill bits, and not only that, no electronics, no cables,
25:29
Speaker 2: no switches, no nothing that breaks. We're just going to
25:35
Speaker 2: shoot a beam of energy down there, and it's just
25:39
Speaker 2: going to open up a hole indefinitely. And the beam
25:43
Speaker 2: doesn't care if the rock is harder or harder or
25:47
Speaker 2: more brace it doesn't matter. And the beam doesn't care
25:50
Speaker 2: if it's ten kilometers or fifteen or twenty kilometers because
25:53
Speaker 2: it loses very little energy. So that's the big idea.
25:57
Speaker 2: The physics are radically different.
26:01
Speaker 1: So it's pulverizing the rock, right, it's turning the rock
26:03
Speaker 1: into powder basically, like how do you get it back
26:07
Speaker 1: up the tube?
26:10
Speaker 2: You blow it out of the hole, very much like
26:13
Speaker 2: the Sahara blows across the ocean because the particles are
26:18
Speaker 2: so tiny that blowing them with a gas stream lifts
26:23
Speaker 2: them up and pushes them out of the hole. So
26:26
Speaker 2: that's it. You're basically pumping a gas and the gas
26:29
Speaker 2: is taking those particulates out of the hole.
26:32
Speaker 1: So this is the idea. They walk into the room with, yes,
26:35
Speaker 1: and you say what?
26:38
Speaker 2: I say many many things, but I say, Okay, how
26:44
Speaker 2: do you build a company out of this? How do
26:46
Speaker 2: you test? What are the key ideas here that you
26:48
Speaker 2: need to test for I was trying to come up
26:50
Speaker 2: to speed with ten years. You got to realize they
26:52
Speaker 2: had been working this for tis a lot of information
26:56
Speaker 2: that I need to pick up, and that I did
26:58
Speaker 2: pick up along the way. But I was just basically saying, Okay,
27:02
Speaker 2: what are the steps? How do you the risk this?
27:04
Speaker 2: How do you make a company? How do you get
27:06
Speaker 2: to market, how you make revenue? All of the things
27:08
Speaker 2: that it to go beyond an experiment into forming a
27:12
Speaker 2: company that has to survive by selling products or services.
27:19
Speaker 2: I also was asking about the team, typical of venture
27:22
Speaker 2: capital question, who is your team? Who is the interrepreneur
27:24
Speaker 2: who is going to do nothing? Twenty four to seven.
27:27
Speaker 2: But these all of those things are super important when
27:30
Speaker 2: you make an investment, and they didn't have good answers
27:33
Speaker 2: to that. They were just pitching a research project. But
27:36
Speaker 2: that helped Aaron, who is a serial entrepreneur, to see
27:40
Speaker 2: me as a person that was very well qualified to
27:45
Speaker 2: potentially lead this. He pitched me the next day. He
27:47
Speaker 2: invited me to breakfast and say, Carlos, why don't you
27:49
Speaker 2: just jump in here and I'll be the CEO. You'll
27:52
Speaker 2: be the CTO. You are cut for this, And I said, well,
27:55
Speaker 2: I just got here, Aaron, Hold on a second. But
27:58
Speaker 2: that's the beginning of that journey. But as I approached
28:03
Speaker 2: my one year anniversary at the Engine, and I knew
28:06
Speaker 2: that I didn't want to be an investor because I'm
28:08
Speaker 2: an near first that's when I started to think seriously
28:13
Speaker 2: about what it would take to actually build a company.
28:14
Speaker 2: So I took I took five months of four months
28:18
Speaker 2: of July of September October doing nothing. I went back home,
28:21
Speaker 2: did nothing, just kind of retired for four months and
28:25
Speaker 2: thinking about nothing but this. So that was that art,
28:27
Speaker 2: and that's when the company was officially born October of
28:31
Speaker 2: twenty eighteen. That's the beginning of the commercial journey.
28:39
Speaker 1: Still to come on the show. Why getting the oil
28:42
Speaker 1: and gas industry interested in what Carlos is doing is
28:45
Speaker 1: key to his plans and really to the whole energy transition.
28:57
Speaker 1: So where are you now?
29:00
Speaker 2: So we are six years in, We've raised more than
29:04
Speaker 2: one hundred million dollars. We are transitioning the technology from
29:10
Speaker 2: the lab to the field. So we have now built
29:15
Speaker 2: full scale systems that are now going to the field
29:20
Speaker 2: to show the world. So we're taking the technogy from
29:24
Speaker 2: the lab to the field. And what that means is
29:26
Speaker 2: we it's no longer inside a controlling environment. It's out
29:31
Speaker 2: there under the open sky in an embodiment that is
29:34
Speaker 2: commercially relevant doing a technology demonstration that will hopefully unlock
29:42
Speaker 2: the Neess round of capital going forward.
29:44
Speaker 1: So specifically, when you say you're taking it from the
29:47
Speaker 1: lab to the field, what exactly are you doing, Like,
29:50
Speaker 1: where are you doing it and physically what is happening.
29:52
Speaker 2: It's in Texas. It all happens in Texas. We have
29:56
Speaker 2: two embodiments of the machine of the drilling machine. We
30:02
Speaker 2: call it a millimeter wave drill rig. One is small,
30:07
Speaker 2: it looks like a mi drilling system. It doesn't look
30:11
Speaker 2: like an oil and gas drilling system. We made it
30:14
Speaker 2: small on purpose to move faster, to prove things faster.
30:19
Speaker 1: When you say it's small, I don't know what a
30:21
Speaker 1: mining drilling system looks like. What's it look like?
30:25
Speaker 2: It looks like like the caterpillars. I mean probably that's
30:30
Speaker 2: the most familiar thing to most people, the caterpillars as
30:33
Speaker 2: you see at construction sites. Yeah, you know, the excavators,
30:38
Speaker 2: the things working around a construction building, that kind of
30:41
Speaker 2: size of machinery. Okay, we've bought one of the shell
30:46
Speaker 2: and we gave it milliontersway in capabilities. We gave it
30:49
Speaker 2: super powers, so to speak.
30:51
Speaker 1: We're a caterpillar, like some kind of construction vehicle that
30:55
Speaker 1: can blast the hole in the earth.
30:57
Speaker 2: Yes, but that's the first version. We put it on
31:00
Speaker 2: a system that can go out there and get it done.
31:04
Speaker 2: And we're doing that in Austin. Tases. We're taking from
31:06
Speaker 2: Houston to Austin near Austin in acquiry, a granite firy
31:10
Speaker 2: to actually show that we can drill through very very
31:12
Speaker 2: hard granite without a drill bit.
31:16
Speaker 1: So you basically are shooting a microwave beam out of
31:19
Speaker 1: this construction vehicle. Into the rock.
31:22
Speaker 2: We're shooting down into the rock and we're drilling a
31:25
Speaker 2: hole through the rock for hundreds of meters, for tens
31:31
Speaker 2: to hundreds of meters. So yes, it's imminent. It's going
31:34
Speaker 2: to happen within the next ninety days. The second embodiment
31:40
Speaker 2: is not small, it's big. It looks just like a
31:45
Speaker 2: drilling rig. You look at it and you say, okay,
31:46
Speaker 2: that's a drilling rig for oil and gas. And that's
31:49
Speaker 2: also in Houston. We're using Neighbors Industries as a partner
31:54
Speaker 2: and we've given superpowers to their drilling rig for the
32:00
Speaker 2: same purposes. But because it's bigger, you can go thousands
32:04
Speaker 2: of meters and you can drill bigger holes with more pipe.
32:08
Speaker 2: That is what gets us into commercial relevance for geothermal.
32:12
Speaker 2: The little one doesn't do that. It's just for show,
32:16
Speaker 2: But the big one does that.
32:18
Speaker 1: When you're going to make a hole with the big one.
32:20
Speaker 2: Oh, it's already happening, but it's happening at a small
32:23
Speaker 2: scale in a yard underneath the rig, in a well.
32:28
Speaker 2: We're we're gonna show it off at Sarah Week in
32:31
Speaker 2: Houston in March. But I think the real question is
32:35
Speaker 2: when can I go to the field and see it
32:37
Speaker 2: in action. When is it drilling a hole that no
32:39
Speaker 2: drill big can drill. And that's in twenty twenty six
32:43
Speaker 2: and twenty seven as part of these commercial projects.
32:45
Speaker 1: So there's a till you've made that's public with a
32:47
Speaker 1: gold mine in Nevada? Is that right? Tell me about that.
32:51
Speaker 2: So this is a mining operation. Is I think it's
32:54
Speaker 2: the third largest gold mine in the world, and it's
32:57
Speaker 2: in Nevada. And they have their own, their very own
33:01
Speaker 2: coal fired power plant. It's a two hundred and fifty
33:03
Speaker 2: megawa coal firepower plant that they use as part of
33:08
Speaker 2: the electricity require for the operation. And they want to
33:10
Speaker 2: decarbonize that. And they've looked and looked and looked, and
33:15
Speaker 2: they've tried solar and they've tried batters, and they said, no,
33:17
Speaker 2: nothing can do it. We're not convinced by anything. Not
33:19
Speaker 2: even the other geo thermal companies that are out there,
33:23
Speaker 2: you know, growing and making it happen. They're not good
33:27
Speaker 2: enough for that level of power required. So they looked
33:31
Speaker 2: at us and said, Okay, your stuff can repower a
33:34
Speaker 2: power plant because it's that hot, that powerful. So that's
33:38
Speaker 2: the nature of that conversation. With them. We can repower
33:42
Speaker 2: their power plant by retiring the cold and replacing it
33:47
Speaker 2: with the geodermal hit.
33:49
Speaker 1: And that's the only one that's public.
33:51
Speaker 2: You have several projects, but that's the only one that's public.
33:54
Speaker 2: That's right, that's right. So there are five projects in
33:57
Speaker 2: the works, one of which is public, but the other
34:01
Speaker 2: four are of a similar nature, not all not not
34:05
Speaker 2: for gold mines, but for multiple industrial use cases. There's
34:10
Speaker 2: probably one that's going to be a data center one
34:12
Speaker 2: I can say as much. There's some that are going
34:15
Speaker 2: to be industrial heat, because that's also another value proposition.
34:18
Speaker 2: But all of them share one characteristic. They're large. There
34:21
Speaker 2: are hundreds of megawads. They're coal fire or gas fire,
34:25
Speaker 2: and we're going to retire that. And they need firm,
34:30
Speaker 2: clean energy. They cannot do with intermittency, they cannot make
34:35
Speaker 2: with transmission cues. They really need a power.
34:39
Speaker 1: They need a dedicated power plant that is always producing
34:42
Speaker 1: power for just their data center or whatever.
34:46
Speaker 2: Yeah, that's a good way to put it. These are
34:48
Speaker 2: the big, big users that are having a hard time
34:53
Speaker 2: finding solutions to the carbonized.
34:56
Speaker 1: So how much deeper do you have to go for
34:59
Speaker 1: these initial projects than sort of standard or even kind
35:04
Speaker 1: of standard modern geothermal companies would go.
35:09
Speaker 2: So three to five kilometers down, that's about two to
35:13
Speaker 2: three miles is the beginning of that journey. And these
35:19
Speaker 2: initial projects are that that depth. The first and the
35:22
Speaker 2: second are that. The third one than Nevada. If that
35:25
Speaker 2: comes third, it's a little bit deeper than that. So
35:29
Speaker 2: the journey starts at two to three miles down, and
35:32
Speaker 2: that's good. That's important because you can get the job
35:35
Speaker 2: done without having to go crazy deep. But it progresses
35:41
Speaker 2: towards twelve miles. We think twelve miles is the final number.
35:45
Speaker 2: We don't need to go beyond that.
35:46
Speaker 1: I mean, twelve miles is an order of magnitude farther
35:50
Speaker 1: than people go. Now right, it's a lot farther. It's
35:52
Speaker 1: not margin.
35:53
Speaker 2: Yeah, twelve miles is twenty kilometers on the average is
35:55
Speaker 2: about two kilometers. So yes, it's a ten x it's
35:58
Speaker 2: a TENNX improvement in depth. But at that point you're
36:01
Speaker 2: talking about humanity having access to industrial grade geothermal, you know,
36:06
Speaker 2: and that's a journey.
36:07
Speaker 1: That humanity meaning it'll work if you can go that deep.
36:10
Speaker 1: You can do geothermal everywhere, basically.
36:13
Speaker 2: Not just that you can do industrial great heat from geothermal,
36:18
Speaker 2: which is quite different. You can do geothermal in many,
36:20
Speaker 2: many places. That's just for bats or agriculture. We're talking
36:23
Speaker 2: about fossil true fossil replacements.
36:27
Speaker 1: Like the kind of crazy heat that lots of industrial
36:29
Speaker 1: processes require that now you have to burn fossil fuels.
36:32
Speaker 2: For that's right, and you can do it everywhere. That's
36:34
Speaker 2: really what we're talking about. Hot and deep, not just
36:38
Speaker 2: hot and not just deep both. So just tell me
36:44
Speaker 2: what it looks like when you make one of these.
36:48
Speaker 2: I went to see it and it existed in the world,
36:50
Speaker 2: your geothermal plant.
36:52
Speaker 1: What would I see? What would it look like?
36:56
Speaker 2: You wouldn't be able to tell it's anything special. It
36:59
Speaker 2: looks like a power plant.
37:01
Speaker 1: How big around is the hole? What's the diameter of
37:05
Speaker 1: the whole?
37:06
Speaker 2: Eight inch diameter of basketball size?
37:08
Speaker 1: A basketball size, so you could you could drop a
37:10
Speaker 1: volleyball down the hole, but not a basketball basketball Betoien.
37:15
Speaker 2: Yeah, it's about an eight and a half inch diameter
37:18
Speaker 2: four two hundred megawats of thermal energy.
37:22
Speaker 1: And if if you drill the twelve mile hole of
37:24
Speaker 1: your dreams and I dropped a penny down the hole,
37:27
Speaker 1: how long would it take to hit the bottom.
37:31
Speaker 2: Oh, a free fall of twelve miles twenty kilometers, it
37:35
Speaker 2: would take I don't know, three minutes, two to three minutes. Yeah,
37:39
Speaker 2: it's like jumping. It's like jumping from an airplane. I
37:41
Speaker 2: mean an airplane flies half.
37:42
Speaker 1: That more, right, it's twice as long as deep as
37:46
Speaker 1: an airplane is high.
37:48
Speaker 2: Yeah, the twelve mile version. Yet we remember we don't
37:50
Speaker 2: start with twelve miles. But yes, you're right, it takes
37:54
Speaker 2: it takes that long to fall.
37:57
Speaker 1: Yeah.
37:58
Speaker 2: Now it's full of water, so it sings rather than fall,
38:01
Speaker 2: so it probably would take longer.
38:02
Speaker 1: Oh right, a slow water. So right, so you don't
38:05
Speaker 1: just drill one hole, right, you drill a hole to
38:07
Speaker 1: get down to the heat and then and.
38:11
Speaker 2: Then what Yeah, so you do? They coming in pairs,
38:14
Speaker 2: always in pairs. One for the weight down. We call
38:18
Speaker 2: that an injector, and one for the weight up. We
38:22
Speaker 2: call that a producer. The pair is eight inch eight
38:26
Speaker 2: and a half inch in diameter each, and they go
38:30
Speaker 2: down to the source rock down below at the temperature
38:33
Speaker 2: we want it to be, and that pair produces as
38:37
Speaker 2: much energy as an oil whale pair injector producer. That's
38:41
Speaker 2: a key concept.
38:43
Speaker 1: And so injector producer is like, what you're injecting is water,
38:47
Speaker 1: and what's coming back up is steam.
38:50
Speaker 2: That is correct. In fact, you keep it under high pressure.
38:53
Speaker 2: So what comes up is superheated liquid which can flash
38:58
Speaker 2: into steam or supercritical water. And that's what you fit
39:01
Speaker 2: into the power plant, not directly but through heat exchangers
39:05
Speaker 2: for many reasons. But that's really what's that's the engine,
39:08
Speaker 2: that's the fuel source.
39:13
Speaker 1: There any like weird unintended consequences like earthquakes.
39:20
Speaker 2: Those are possible, right every time you pump into the earth,
39:23
Speaker 2: that's a possibility, especially if you go into fault faulty songs.
39:28
Speaker 2: But remember what I told you. We don't pump, we
39:30
Speaker 2: don't ramp pressure into the earth. We just fill a
39:34
Speaker 2: hole with cold water and nature does the rest. In fact,
39:38
Speaker 2: we're replicating a process that happens in nature at scale.
39:40
Speaker 2: That's how every mind in the world gets formed. So
39:44
Speaker 2: will there be earth bakes? I think if you do
39:46
Speaker 2: this in the wrong place in a big fall, there
39:48
Speaker 2: is a risk for that. But if you did do
39:50
Speaker 2: this in most places in the world, there's no faults
39:55
Speaker 2: of the kind of mentioning here, there shouldn't be a
39:57
Speaker 2: reason for that, So anything else.
40:00
Speaker 1: Like that, any other weird geological activity.
40:04
Speaker 2: That that could happen as a as a consequence, I
40:10
Speaker 2: don't think so. I mean, you cool the rock ten
40:13
Speaker 2: degrees twenty degrees over the lifetime of the asset, and
40:17
Speaker 2: then you move on. So that's a very small cool
40:20
Speaker 2: down out. We are pricking. It's like a needle, tiny
40:24
Speaker 2: needle prick in the skin to mine a little bit
40:27
Speaker 2: of it of that, you know, but this is regulated.
40:30
Speaker 2: So I'm not gonna say that there's zero risk. There's
40:32
Speaker 2: always risk. But the earthquakes that are associated with geothermal
40:37
Speaker 2: are of a very different kind and are usually because
40:39
Speaker 2: you're crambing pressure with pumping trucks into the earth. We're
40:43
Speaker 2: not doing that.
40:44
Speaker 1: What do you do with the dust that you blow
40:47
Speaker 1: back up?
40:49
Speaker 2: It's wonderfully useful for many, many things, and you cannot
40:53
Speaker 2: just discharge that. You know, that's particulate matter, So you
40:56
Speaker 2: treat it, you separate it, and some of it will
40:59
Speaker 2: find value streams in industry, and you think the value
41:05
Speaker 2: the value of it will sort of offset the cost
41:08
Speaker 2: of treating it enough that it's not gonna mess up
41:11
Speaker 2: your economics for some for some things, not for everything.
41:15
Speaker 2: Some things you just you just leave them in an
41:17
Speaker 2: inert neutral state, like cuttings in a in a drill rig.
41:22
Speaker 2: You know what do you do with the cuttings. You
41:24
Speaker 2: don't just dump them overboard in off short breaks. You
41:27
Speaker 2: treat them. There's regulation about that, and you dispose of
41:29
Speaker 2: them properly. You make them inert. Some will be valuable,
41:33
Speaker 2: but you know, we don't put that into the techn economics.
41:37
Speaker 2: But we know that these things will be valid.
41:39
Speaker 1: So when you're modeling it, you assume that that's just
41:41
Speaker 1: a pure cost, and even even at that estimation, you
41:46
Speaker 1: think you can correct.
41:48
Speaker 2: Yeah, it's it's the business is the business of energy.
41:51
Speaker 2: That is the techn economic model. How much does it
41:54
Speaker 2: cost to get to the energy, to produce it, to
41:56
Speaker 2: operate it, and how much does itself for That is
41:59
Speaker 2: the business model.
42:00
Speaker 1: So give me the like, like, give me the long view.
42:08
Speaker 2: We've been talking about little things. I've been asking about
42:10
Speaker 2: this detail in that detail, like what's the big picture,
42:15
Speaker 2: the five year picture of the tenure picture. So in
42:20
Speaker 2: the five years, we're doing the first five projects or
42:23
Speaker 2: achieving bank ability. So that's still in the details, that's
42:26
Speaker 2: in the weeds. The company is really trying to break
42:29
Speaker 2: through into true commercial scale. But the big view of
42:34
Speaker 2: the reason I do this is because the day the
42:38
Speaker 2: oil industry looks at a geothermal project with the same
42:42
Speaker 2: eyes that they look at an oil and gas project,
42:46
Speaker 2: you've won. Huh, that's the beginning of the end.
42:49
Speaker 1: It's interesting to have the sort of oil and gas
42:52
Speaker 1: industry centric view of the energy transition, Like, why do
42:56
Speaker 1: you say that?
42:59
Speaker 2: Ever since you and I have been alive, the oil industry,
43:02
Speaker 2: the workforce, the capital, the regulation, the infrastructure, has been
43:07
Speaker 2: putting into the world two terra watts of new capacity
43:12
Speaker 2: simply to keep up with not growing but stable demand.
43:19
Speaker 2: Let me say that again, oil feels decline in production.
43:22
Speaker 2: Just to keep up with the amount of energy that
43:25
Speaker 2: we humans consume, they need to bring online new capacity
43:31
Speaker 2: that adds up to about two terrawats per year. There's
43:36
Speaker 2: nothing like it, not even by orders. Manage the closeness
43:39
Speaker 2: to it. If it doesn't involve the oil industry, it
43:42
Speaker 2: won't happen in this generation. It will take longer, and
43:46
Speaker 2: the oil industry is not going to do the job
43:50
Speaker 2: if it implies a compromise for them. Geothermal is a compromise.
43:55
Speaker 2: It's like okay, yeah, I'm going to encouras much cost
43:57
Speaker 2: and as much risk, and I'm going to get a
43:59
Speaker 2: fraction of the profit back. Why would I do geothermal
44:03
Speaker 2: when I can do oil and gas. So that is
44:05
Speaker 2: the game I need to play with them. The minute
44:08
Speaker 2: they look at geo thermal the same way, the same
44:12
Speaker 2: profit margin, is the same skill, the same business opportunity
44:14
Speaker 2: as they do oil on gus, You've won because at
44:18
Speaker 2: that point they will take it over and do it
44:21
Speaker 2: at the tutor awatskill plus and then you transition energy
44:25
Speaker 2: until then we're playing another manitude out of the league
44:29
Speaker 2: that we need to be playing at.
44:34
Speaker 1: We'll be back in a minute with the lightning round. Okay,
44:47
Speaker 1: we're gonna finish with the lightning round. It's gonna be
44:52
Speaker 1: much more random. What one thing you did when you
44:56
Speaker 1: served in the Colombian Army after high school?
44:59
Speaker 2: I trained to be a soldier, so I very much
45:04
Speaker 2: went through weaponrytraining, military approaches and assaults, and I actually
45:10
Speaker 2: went into operations totally, not into a war zone, but
45:16
Speaker 2: that was my military training. I was a soldier for
45:21
Speaker 2: a year before coming to m T.
45:24
Speaker 1: Yeah, so what's that like. You grew up in Medigan,
45:26
Speaker 1: you were a soldier, and then you went to M
45:29
Speaker 1: I t like what was what was one surprising thing
45:33
Speaker 1: to you when you got there?
45:36
Speaker 2: Life changing? So I think I fell at home at
45:40
Speaker 2: MIT in many many ways. I was always very curious
45:46
Speaker 2: about physics, engineering. I would do many things by myself,
45:49
Speaker 2: and I would never feel quite at home in Columbia.
45:51
Speaker 2: I would never find the groups or the university for
45:54
Speaker 2: the classes that would satisfy me. MIT, for the first
45:56
Speaker 2: time ever in my life, gave me that what's one
46:00
Speaker 2: thing I should do if I go to Medagan, Oh,
46:04
Speaker 2: my god, one thing impossible. We have to do one
46:07
Speaker 2: hundred things. You should go and get into the rich
46:12
Speaker 2: songs of the city, the bosons of the city, and
46:14
Speaker 2: just so giddling. Then you should also eat because there's food,
46:17
Speaker 2: good food everywhere.
46:18
Speaker 1: What's one thing I should eat?
46:20
Speaker 2: But they have AISA, but you should share that because
46:24
Speaker 2: it's probably five thousand calories at least.
46:28
Speaker 1: What is it?
46:30
Speaker 2: Combination of rice, beans, meat, pork, rins, plantains, avocado, and
46:37
Speaker 2: arib which is a corn patty.
46:40
Speaker 1: Very basically it's everything. It's basically everything.
46:43
Speaker 2: Oh maybe a Friday too, So yes, it's everything. It's
46:46
Speaker 2: very large, very satisfying, very delicious, not to be eaten
46:50
Speaker 2: every day.
46:53
Speaker 1: What was the second best idea you heard when you
46:56
Speaker 1: were working as a venture capitalist at.
46:58
Speaker 2: AH It must have been the approach to fusion. I
47:02
Speaker 2: was in the room with Bob Momtguard first approached the
47:06
Speaker 2: engine to say, hey, we have these tape to make
47:09
Speaker 2: a stronger magnet. And I say, oh, this is a
47:12
Speaker 2: very very good idea, because that's a very good approach
47:15
Speaker 2: to actually get going with fusion single handedly. If I
47:18
Speaker 2: were not doing ways, that's where I would probably be
47:21
Speaker 2: putting my life forcings.
47:23
Speaker 1: I mean, it's maybe even more of a long shot,
47:28
Speaker 1: but even bigger if it works.
47:30
Speaker 2: Right, Oh, I think so that is the ultimate energy source.
47:35
Speaker 2: Ultimate We didn't talk about it. Why not fusion? Well, yes,
47:38
Speaker 2: fusion is the way to do it, But why not
47:40
Speaker 2: fusion has to do simply with building the infrastructure, the
47:44
Speaker 2: human capital. Everything needs to be built. It doesn't exist.
47:47
Speaker 2: The industry needs hasn't been born, the humans haven't been
47:51
Speaker 2: born at skill to do it. And I think geo
47:54
Speaker 2: politics will play a very strong role. These are devices,
47:57
Speaker 2: These are machines. To me, they are like an F
47:59
Speaker 2: twenty two and F thirty five. These are things that
48:02
Speaker 2: you don't give to everybody or seldom. They're not for sale. Yeah,
48:06
Speaker 2: they're not for sale, and yes, but we'll probably agree
48:09
Speaker 2: with I mean, you can make them go for sale,
48:10
Speaker 2: but think about it. You sell airplanes to other nations,
48:13
Speaker 2: but you don't sell f thirty fives. You know, these
48:15
Speaker 2: are so differentiated that they become geopolitically sensitive.
48:19
Speaker 1: Like whatever country figures it out is going to say,
48:22
Speaker 1: we're not giving this to anybody, We're keeping it. We're
48:24
Speaker 1: only going to give it to our friends, something like that.
48:26
Speaker 2: It's the ultimate company of advantage, the ultimate company.
48:30
Speaker 1: Free unlimited energy.
48:31
Speaker 2: Yeah, yes, yes, forget about everything else. That's it. You've
48:37
Speaker 2: done it.
48:39
Speaker 1: What pun are you most tired of hearing related to
48:43
Speaker 1: Quays to your work?
48:45
Speaker 2: The funds make themselves in geotheraphone, Yeah right, I enjoy
48:50
Speaker 2: them all.
48:51
Speaker 1: But what's your favorite? Then?
48:54
Speaker 2: My favor is we we gotta keep digging deeper to
48:57
Speaker 2: solve energy transition.
49:05
Speaker 1: Carlos Arake is the co founder and CEO of Quays And.
49:10
Speaker 1: Today's show was produced by Gabriel Hunter Cheng. It was
49:13
Speaker 1: edited by Lyddy Jean Kott and engineered by Sarah Bruger.
49:17
Speaker 1: You can email us at problem at Pushkin dot Fm.
49:21
Speaker 1: I'm Jacob Goldstein and we'll be back next week with
49:24
Speaker 1: another episode of What's Your Problem.