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Sustainability now: Preparing for the energy grid of tomorrow · PwC's accounting podcast

• 0:00
  SPEAKER_00: Thought Leadership from PWC's National Office.
• 0:09
  SPEAKER_02: Hello, I'm Heather Horn, PWC's U.S.
• 0:12
  SPEAKER_02: Sustainability Technical Leader, and welcome back to PWC's Accounting Podcast.
• 0:17
  SPEAKER_02: This is Sustainability Now.
• 0:19
  SPEAKER_02: Today we're diving into one of the most consequential issues facing markets, policymakers, and companies alike.
• 0:26
  SPEAKER_02: The future of energy demand and how we're going to meet it.
• 0:30
  SPEAKER_02: To help us understand these dynamics, I'm very excited to welcome Gail Miller, head of strategic investor engagement for Brookfield's Global Client Group and senior advisor to the renewable power and transition business.
• 0:42
  SPEAKER_02: Gail sits at the intersection of policy, infrastructure, and private capital, which makes her uniquely positioned to help us understand what's driving today's surge in energy demand, what an all of the above supply strategy really looks like in practice, and how investors are thinking about risk, opportunity, and sustainability reporting in this next chapter, the energy transition.
• 1:04
  SPEAKER_02: All right, Gail, I'm maybe you have a gal.
• 1:07
  SPEAKER_02: But before we get started, a quick note.
• 1:10
  SPEAKER_02: If you'd like to watch the video version of this conversation, you'll find a link in the show notes.
• 1:14
  SPEAKER_02: All right, with that, let's get started.
• 1:16
  SPEAKER_02: Thank you so much for joining me, Gail.
• 1:17
  SPEAKER_02: Thank you.
• 1:18
  SPEAKER_02: So, Gail, let me ask you a question just to start, just to level set and help our under our audience understand a bit of where you're coming from.
• 1:26
  SPEAKER_02: And this just understand a bit of your background and how you got so interested in this conversation.
• 1:31
  SPEAKER_03: I um thank you.
• 1:32
  SPEAKER_03: And I'm thrilled to be here.
• 1:34
  SPEAKER_03: This has just been such a great morning and learned a lot from you.
• 1:37
  SPEAKER_03: So I appreciate that.
• 1:38
  SPEAKER_03: I started my career really thinking through how I grew up.
• 1:43
  SPEAKER_03: I grew up in South Africa where water was, again, just like living in California, there was a huge shortage, went through really significant droughts where we could fill our bathtub once a day.
• 1:56
  SPEAKER_03: The ability to use water was so limited that I started, and this was a very long time ago, started to think about what it means to have really limited natural resources and how it affects all of us, many of the things we don't think about.
• 2:10
  SPEAKER_03: So I spent the this first part of my career focused on climate policy.
• 2:15
  SPEAKER_03: I got to work on the Cap and Trade program and how we further implemented the Clean Air Act in California, and then started to think through the ways that we can shift capital and worked with the state's pension funds, trillion dollars in capital, shifting that to net zero, along with the big global movement.
• 2:35
  SPEAKER_03: So we have funds in in Singapore and in Japan and Canada and Australia all thinking through what it looks like to use this capital in terms of the in terms of energy security.
• 2:50
  SPEAKER_03: And in doing that, I also with California worked a lot on building out the clean energy infrastructure and worked with the regulators to ensure that that California can meet its clean energy goals in 2035.
• 3:04
  SPEAKER_03: Um and the two years ago I got to join Brookfield and and work on on these very similar issues, which is the now I spend a lot of time thinking about the why.
• 3:14
  SPEAKER_03: And now I get to think about the how.
• 3:17
  SPEAKER_03: So how we actually execute on building for this energy security that we all spend a lot of time talking about.
• 3:25
  SPEAKER_03: So that's been really a remarkable experience to not only think about the theory behind what the what it looks like, but the working with the people that have this incredible operational expertise to get it built.
• 3:38
  SPEAKER_02: So yeah, and your experience really gives you a unique perspective, I think, into a lot of the issues we're dealing with today.
• 3:45
  SPEAKER_02: And just I'll I'll tease that later in the podcast for our listeners, we're gonna talk a bit about sustainability reporting in California, because I feel like some of that is a culmination of some of the other work you've done in California and otherwise.
• 3:58
  SPEAKER_02: But maybe to just start things off and dig into some of the issues from your perspective as we look at the current environment and then as we look ahead, what are some of the biggest forces that are impacting demand?
• 4:13
  SPEAKER_02: And we can talk about supply as well, because obviously we need those.
• 4:16
  SPEAKER_02: So, yes, when we're talking about uh electricity.
• 4:20
  SPEAKER_03: Well, I do think that the demand, I love talking about this because I approach demand as as skeptically as many of you do, and I I think PWC has written a lot about this.
• 4:32
  SPEAKER_03: So we've done an exercise where we've looked at demand from multiple sources to really pressure check is this accurate?
• 4:41
  SPEAKER_03: Because I think the big question of our time is is are these demand curves that we're seeing going straight up, like sometimes triple the amount of of what we thought it was just just two years ago, are they accurate?
• 4:55
  SPEAKER_03: And what is so increasingly clear is that the biggest gating function of growing our economy is energy, in part because, you know, in 2012, we thought we were good.
• 5:08
  SPEAKER_03: The United States and so many people around the globe stopped building, yes, stopped investing in transmission because we didn't think it was necessary.
• 5:17
  SPEAKER_03: So we had this really five-year period where where there was no investment in what, and now the step increase is so great that however you slice it, it the the demand function is so great.
• 5:32
  SPEAKER_03: And of course, a lot of that is driven by data centers.
• 5:35
  SPEAKER_03: It's also driven by electrification, it's also driven by industrialization.
• 5:40
  SPEAKER_03: So it is the the AI revolution is absolutely driving demand, but we have to remember that our grid wasn't even built.
• 5:49
  SPEAKER_03: Yes.
• 5:50
  SPEAKER_03: Now we've realized for the the basic needs, which included some electrification and this industrialization.
• 5:58
  SPEAKER_03: So we, and then on top of that, we put the data centers.
• 6:02
  SPEAKER_03: And so, whichever way you slice demand, it is it the step increase is so significant that that all of us really do have to figure out how that's gonna be met.
• 6:13
  SPEAKER_03: And that's why we talk about this this any and all energy supply to really come in and be that energy addition that's so incredibly necessary to really power everything that we're trying to do in our economy.
• 6:27
  SPEAKER_02: Yeah, and I think one of the things, just taking a step back and thinking about the landscape, one thing I don't think everyone appreciates who hasn't come from like a background like you have is it takes time to build transmission lines, to build power plants, you know, even to put renewables in, which are relatively quick, all of this takes time.
• 6:48
  SPEAKER_02: And the demand is rising so fast now.
• 6:51
  SPEAKER_02: To your point, there was this period where we thought demand was actually going down.
• 6:56
  SPEAKER_02: Power plants were being shut down.
• 6:58
  SPEAKER_02: Right.
• 6:58
  SPEAKER_02: And so those two things seem like now they're colliding.
• 7:02
  SPEAKER_02: And so as you think about that challenge, what are some of the things you think about?
• 7:05
  SPEAKER_02: And maybe explaining this all all or everything energy supply.
• 7:10
  SPEAKER_02: Yeah.
• 7:11
  SPEAKER_03: Well, a few things I'd say.
• 7:12
  SPEAKER_03: One, the it absolutely all takes time.
• 7:15
  SPEAKER_03: Yes.
• 7:16
  SPEAKER_03: So the if we were to just think about what the least amount of time to the most amount of time, renewables are just the least amount of time, especially wind, solar, and batteries.
• 7:27
  SPEAKER_03: Because, and we see this all the time, where I I almost wish I had a couple of slides here, but where the the ability of clean energy to scale because of how quickly it can be built and then add power is is so much faster than than gas or any other form of renewable energy.
• 7:45
  SPEAKER_03: The talking about supply, gas is is a really important part of the global energy solution, and especially in the US.
• 7:54
  SPEAKER_03: But it does take five years just to get the turbine, get it installed, connect it to a pipeline, assuming you have access to the resource.
• 8:03
  SPEAKER_03: So the the scalability of renewables is just a lot faster than gas.
• 8:09
  SPEAKER_03: The ability for the grid to function will be a two-part answer.
• 8:16
  SPEAKER_03: One is increasing capacity on the grid, which will mean building more more grid capacity either through high voltage, high transmission lines, and through some software solutions.
• 8:28
  SPEAKER_03: There are AI companies working through how we use software to get this, what we call a capacity matching, which is where there is capacity on the grid to be able to move it faster to where the demand is greater.
• 8:43
  SPEAKER_03: The second way that some of this will be solved is you'll see data centers going in where the grid already has capacity.
• 8:52
  SPEAKER_03: So there's an existing interconnection.
• 8:54
  SPEAKER_03: There is, there happens to be an industrial complex that's shut down.
• 9:00
  SPEAKER_03: You'll see a data center going there.
• 9:02
  SPEAKER_03: So you're more tightly matching capacity to demand.
• 9:06
  SPEAKER_03: And then the third piece that I that I do think will be really interesting is this idea of co-location.
• 9:15
  SPEAKER_03: So Brookfield, for example, has has an investment in fuel cells that can be co-located on the grid, which means it is still helping the grid, but it is behind the meter for some of these hyperscalers so that they have this guaranteed source of power that helps run the business and support the grid.
• 9:36
  SPEAKER_03: So I think those are three ways in the short term, as as you see the grid being built out, that that will start to see more and more solutions to meet the current demand while preparing for the future.
• 9:51
  SPEAKER_02: So this is maybe too low of a question, but do you when you look ahead, do you think we're preparing fast enough?
• 9:59
  SPEAKER_02: Because again, when we think of these timelines and this, um I wish hopefully people are watching this like the straight up almost you know increase in demand.
• 10:09
  SPEAKER_02: Uh, because I mean there it even with renewables, there is a timeline question.
• 10:16
  SPEAKER_03: Yeah, I I think that is kind of the question of our time, which is which really is that technology and government move at different speeds.
• 10:26
  SPEAKER_03: So, yes, I absolutely think government is preparing, and I absolutely think they're trying to figure out how to get that increased capacity.
• 10:34
  SPEAKER_03: They're approving new transmission lines, they're, and this is all the independent system operators.
• 10:41
  SPEAKER_03: There will have to be other solutions, including, including working with companies like Berkfield that know how to how to create, that have this operational excellence, that can build at scale, that can build quickly, that can form these agreements.
• 10:56
  SPEAKER_03: It will not be enough to rely on government anymore.
• 11:00
  SPEAKER_03: We are, we are, they can't move quickly enough.
• 11:03
  SPEAKER_03: And the ability to build the transmission just takes time, not unlike gas.
• 11:08
  SPEAKER_03: So there have to be other solutions providers that come in that can that can operate quickly and that can build at scale much faster.
• 11:17
  SPEAKER_03: And we we really are seeing that.
• 11:19
  SPEAKER_03: That we used to solely rely on policy in in the energy business with a lot of we call them day-ahead markets and this fluctuating energy prices, and you would determine your energy price, you know, just a couple days ahead.
• 11:33
  SPEAKER_03: Now you have stable energy pricing with the power purchase agreements.
• 11:37
  SPEAKER_03: There is much more opportunity to build, and there's a much greater opportunity for the private sector to come in and offer solutions around energy, really, than we've than we've ever seen before.
• 11:49
  SPEAKER_03: And it all goes back to this.
• 11:52
  SPEAKER_03: We did not in 2012 anticipate we would ever need this level of energy.
• 11:57
  SPEAKER_03: And there's there's just no catch-up period.
• 12:00
  SPEAKER_03: Right.
• 12:00
  SPEAKER_03: So we have to come up with solutions immediately.
• 12:03
  SPEAKER_02: So then if we look at the parties involved, you have utilities, you have the government, the ISOs, you have um companies like Brookfield, you have consumers, and you have, I'll say the large hyperscalers and smaller companies.
• 12:18
  SPEAKER_02: How do you see all of these parties working together?
• 12:21
  SPEAKER_02: And you could start with what role you would play, and then what role you think are important for some of our listeners to think about for their own either consumer perspective or their company perspective?
• 12:34
  SPEAKER_03: It's that's a it's a great question because I think they're all slightly different, but it is all part of the same, the same kind of puzzle of how we piece this together.
• 12:45
  SPEAKER_03: So maybe the the best way to start is is with an example.
• 12:49
  SPEAKER_03: Brickfield has an agreement with with Microsoft, it's a 10 and a half gigawatt agreement to provide power.
• 12:57
  SPEAKER_03: So which is a huge amount of power.
• 12:59
  SPEAKER_03: A huge amount of power.
• 13:00
  SPEAKER_03: This can power Sweden, it is, it can power um three states in the nation.
• 13:05
  SPEAKER_03: It is it's just a huge of three small states, a huge amount of power.
• 13:11
  SPEAKER_03: Yeah.
• 13:11
  SPEAKER_03: It is, and and that is just to meet existing demand for for Microsoft.
• 13:18
  SPEAKER_03: So, and we have another, for example, deal with with Google on hydro power to also to meet this demand.
• 13:28
  SPEAKER_03: So, what we're seeing from the people that need the power the most is that they're coming to solutions providers rather than going straight to the utility.
• 13:38
  SPEAKER_03: So, what it takes is the ability to build and the ability to execute quickly.
• 13:44
  SPEAKER_03: So, that's that's the example of how hyperscalers are working with folks like Brookfield to make sure that they either get the power built or that Brookfield has the ability to invest in existing resources.
• 14:00
  SPEAKER_03: There's so many opportunities and having this operational excellence and expertise that we have where we can really find the best investments and bring that power online fastest.
• 14:11
  SPEAKER_03: So that's that's how we're seeing a solution that's very aligned with the existing, the existing system that you just explained, which is which is the the bulk power coming all the way down to the utilities and then powering the the home or the data center.
• 14:30
  SPEAKER_03: The the second piece that that I think will require, in addition, so policy will be required to build transmission.
• 14:37
  SPEAKER_03: In the meantime, we will execute on building and creating systems quickly.
• 14:44
  SPEAKER_03: The piece for how we ensure that that other businesses can connect to the grid.
• 14:50
  SPEAKER_03: So some of some of your clients, I'm sure, are saying, what if you're not a hyperscaler?
• 14:56
  SPEAKER_03: And what if you are a housing development or a grocery store?
• 15:00
  SPEAKER_03: How do how does that work to make sure that that there is power available and you can get connected to the grid quickly and not be not be in a position where where you're like way behind in this power queue?
• 15:14
  SPEAKER_03: So that is that is again a question of policy and but also working really closely with utilities.
• 15:21
  SPEAKER_03: So utilities are still have capacity on their grids.
• 15:27
  SPEAKER_03: And what we'll start to see more and more, and this is a benefit of AI, is AI will start to search the grid for where there is capacity so that we have the same amount of power, but increased efficacy of the grid.
• 15:41
  SPEAKER_03: And so for companies that are looking for grid connections, I think there's two solutions.
• 15:49
  SPEAKER_03: One is is obviously understanding where they are in their queue position and how long it will take.
• 15:56
  SPEAKER_03: And then two is seeing if if they have an option for location, making sure that that before they choose a location, they've asked this question of where the grid has capacity.
• 16:09
  SPEAKER_03: So I think some of it is strategically either getting in the queue or finding a superior queue position.
• 16:17
  SPEAKER_03: And then the other piece is even before building, and this never used to happen either, the connection came at the end.
• 16:25
  SPEAKER_03: Right.
• 16:25
  SPEAKER_03: The connection really does need to be moved up in the development process.
• 16:29
  SPEAKER_03: In some instances, if you're in a really dense area, probably to the beginning of a development process.
• 16:35
  SPEAKER_03: So if you're building a housing development, for example, you make sure you can get that connection before you have a shovel in the ground.
• 16:42
  SPEAKER_02: Right.
• 16:43
  SPEAKER_02: Because you don't want to have that, then you're done and that's holding you up.
• 16:48
  SPEAKER_02: Right.
• 16:49
  SPEAKER_02: But let me, I think one point that our listeners may not fully appreciate unless they come from this background.
• 16:54
  SPEAKER_02: You talked a bit about the efficacy of the grid.
• 16:57
  SPEAKER_02: And I think one thing that's so interesting is if you look at planning that utilities have done historically, they look for that peak day.
• 17:05
  SPEAKER_02: And so they have enough power normally for that peak day.
• 17:08
  SPEAKER_02: And then the rest of the year, there should be excess.
• 17:13
  SPEAKER_02: And so how, and then to your point, there's also locations that have more power than others.
• 17:19
  SPEAKER_02: And so, how does AI think about these pieces?
• 17:22
  SPEAKER_02: And they call that flattening demand where it's it's more even.
• 17:26
  SPEAKER_02: So, how did those pieces fit together as you look ahead at some of the challenges?
• 17:31
  SPEAKER_03: Yeah, that's such a good point because I think whenever we talk about demand, we're talking about the demand on those highest years.
• 17:38
  SPEAKER_02: It's the hot really cold and it's really hot.
• 17:40
  SPEAKER_03: Yeah.
• 17:40
  SPEAKER_03: So it's it balancing that out, there are, and this has been around for a long time, flattening demand.
• 17:48
  SPEAKER_03: Japan is a great example of this.
• 17:50
  SPEAKER_03: So Japan voluntarily will share power between apartment buildings, where if they have, they have a great demand day rather than depending on what the US depends on, which is the day ahead market.
• 18:04
  SPEAKER_03: And I'll tell you what that is.
• 18:05
  SPEAKER_03: Japan actually voluntarily, whole buildings will shut their lights off for two hours at a time to share power.
• 18:12
  SPEAKER_03: So I don't think we ever realize that power is actually a shared commodity.
• 18:16
  SPEAKER_03: And there are ways that it that it can be shared amongst us.
• 18:20
  SPEAKER_03: So that's an example of demand flattening.
• 18:23
  SPEAKER_03: One building turns off, another turns on, they turn off, they get their power.
• 18:27
  SPEAKER_03: Um, and then what we do, for example, in in the United States is we on the days where the demand is in excess of any available power, that means peaker plants have been turned on, and there is every single opportunity to use power, clean or dirty, is powered up, and you still can't meet the demand.
• 18:54
  SPEAKER_03: Then what states do is they they really buy power from each other.
• 18:58
  SPEAKER_03: So California, for example, will buy power from Arizona, New York will buy power from New Jersey, and that's how they meet the demand on the peak days.
• 19:08
  SPEAKER_03: To give you an example of demand smoothing, three years ago in California, there was a day like that.
• 19:15
  SPEAKER_03: All the um utilities sent a text message asking people to save power.
• 19:20
  SPEAKER_03: People, you can't you can't overuse this, right?
• 19:22
  SPEAKER_03: Because then no one would believe you.
• 19:24
  SPEAKER_03: It actually brought that demand curve down enough that there were no rolling blackouts that day.
• 19:29
  SPEAKER_03: So demand smoothing is not to be cliche, it is it is saving some energy.
• 19:34
  SPEAKER_03: And then it's working with the the highest energy users to smooth out, to reduce the amount of power they're they're using on a given day.
• 19:44
  SPEAKER_03: So that means the latency, the time it's taking for you to get your answer from AI is gonna take longer.
• 19:50
  SPEAKER_03: There is a way that AI becomes part of that solution where, and there are there are hyperscalers and AI companies testing these ideas out now, where they use grid software.
• 20:03
  SPEAKER_03: Texas has done this relatively successfully to try and smooth with every utility.
• 20:09
  SPEAKER_03: So the utility has to agree to do this.
• 20:12
  SPEAKER_03: In some instances, depending on the state homeowners, have to agree.
• 20:16
  SPEAKER_03: But smoothing demand so that so that you don't guarantee a certain demand to a single house, a certain amount of power, excuse me, to a single house, but you allow those houses to share based on software.
• 20:31
  SPEAKER_03: It's no longer just based on actually supplying the power.
• 20:36
  SPEAKER_03: It's actually based on the software's understanding of demand, and that can have some of this demand smoothing too.
• 20:43
  SPEAKER_03: So I do expect, and and the same eventually can be true on the grid itself.
• 20:48
  SPEAKER_03: I do expect that AI, as it learns more, will in fact make the grid the this top layer of the energy issues and utilities more efficient the more and more it's used.
• 21:02
  SPEAKER_03: But as we know, AI is only as valuable as what it's learning.
• 21:05
  SPEAKER_03: Yes.
• 21:06
  SPEAKER_03: So in order to have it learn more, we have to start these processes.
• 21:10
  SPEAKER_03: So hopefully, what we'll see are more independent system operators bringing in these AI tools and more utilities bringing in the tools.
• 21:18
  SPEAKER_03: Because again, we have these delays.
• 21:21
  SPEAKER_03: We we have no time to wait, and yet delays to make it work.
• 21:24
  SPEAKER_02: Right, exactly.
• 21:25
  SPEAKER_02: And I think one key point uh that you were talking about is this voluntary smoothing versus the black rolling blackouts because things like rolling blackouts, again, for our listeners' benefit, that means someone who needs electricity for their, you know, home health equipment, hospitals, which hopefully would have the backup generators.
• 21:46
  SPEAKER_02: But there's a lot of uh different parties that really cannot have their power shut off.
• 21:52
  SPEAKER_02: Exactly.
• 21:52
  SPEAKER_02: And it's you know, relatively for these apartment buildings, two hours without power, you know, and it's planned.
• 21:58
  SPEAKER_02: That that really does.
• 22:00
  SPEAKER_02: Make a big difference.
• 22:01
  SPEAKER_02: It makes a big difference.
• 22:02
  SPEAKER_02: Yeah.
• 22:02
  SPEAKER_03: And ensuring absolutely that you are supplying power to the people that need it the most.
• 22:08
  SPEAKER_03: The probably the best example of this, even just in New York recently, with the freezing cold, we don't we underestimate weather-related deaths for people that are more vulnerable.
• 22:18
  SPEAKER_03: So assisted living facilities, for example, many of them don't have backup power.
• 22:23
  SPEAKER_03: So that's another way we could create more efficiency, is understanding who have the greatest needs with the most vulnerable populations and ensuring that they keep the power on.
• 22:36
  SPEAKER_03: That's absolutely an area, an area for improvement.
• 22:39
  SPEAKER_02: So let me shift then to the energy supply and the types of supply.
• 22:44
  SPEAKER_02: And as we, you know, you and I talked earlier just about the change in pricing and solar and wind and how policy really helped drive those prices down.
• 22:57
  SPEAKER_02: And where today you don't need subsidies because it's actually cheaper in many cases than other sources.
• 23:03
  SPEAKER_02: Do you see that happening for other types of power?
• 23:07
  SPEAKER_02: And then how do you see what's the array you see meeting this future demand?
• 23:12
  SPEAKER_03: I I do see it happening.
• 23:13
  SPEAKER_03: I think you said it best earlier.
• 23:15
  SPEAKER_03: You know, in the in the 90s, you said you were a young auditor in Bakersfield, figuring, like seeing how incredibly expensive wind farms were at the time, California came in, really subsidized both the supply and the development costs.
• 23:29
  SPEAKER_03: And shockingly, the the ability for renewables to scale and create parity and not rely on subsidies has been faster than any other energy source.
• 23:40
  SPEAKER_03: So faster than any picker plant or any gas plant or or oil or even coal.
• 23:45
  SPEAKER_03: So that ability to create this price parity over such a short amount of time is pretty remarkable.
• 23:53
  SPEAKER_03: The the this we call it the any and all solution absolutely will continue to include gas.
• 23:59
  SPEAKER_03: Gas is an important part of the energy market.
• 24:03
  SPEAKER_03: And we see that really all over the world to the extent they have it.
• 24:08
  SPEAKER_03: So I think the in the emerging markets, for example, we get to work on a catalytic transition strategy where what we're seeing the greatest needs are in Southeast Asia, for example, huge needs for power, very limited gas, rather than importing it and paying a huge amount of money, they are leapfrogging that technology entirely and relying exclusively on renewables.
• 24:34
  SPEAKER_03: Which goes to show you like if you were to start the grid over, you would actually have mostly renewables in order to create a more efficient system.
• 24:43
  SPEAKER_03: The same is true in China.
• 24:44
  SPEAKER_03: That's why China is building so many renewables because they don't have access to natural gas.
• 24:50
  SPEAKER_03: They're right now importing a lot from the United States, but they'll keep building renewables to decrease the amount they need to import.
• 24:58
  SPEAKER_03: So that then we look at, so that's true for wind, solar, and storage.
• 25:03
  SPEAKER_03: I can't emphasize enough the growth we're seeing in battery storage.
• 25:08
  SPEAKER_03: Why it's so important is that's what shores up your wind and solar.
• 25:12
  SPEAKER_03: So all the concerns folks have had of intermittency, batteries solve that problem.
• 25:18
  SPEAKER_03: Because you go from having power when there's the wind is blowing or the sun is shining to having power all the time because the battery is backing you up.
• 25:27
  SPEAKER_03: And then when we look at other renewable sources that we do see as really important and that the federal government continues to support, I'd say nuclear is top of that list.
• 25:40
  SPEAKER_03: Brookfield has an agreement with the US government.
• 25:42
  SPEAKER_03: It's it's$80 billion investment in nuclear.
• 25:46
  SPEAKER_03: And what that means is every AP 1000, California actually is the older version of the AP 1000, is a gigawatt of energy.
• 25:55
  SPEAKER_03: So a huge amount of power in a single location.
• 26:00
  SPEAKER_03: And that will be true for geothermal, which again is more power by going really, really deep into the ground and accessing kind of the deeper layers of earth to create to create cleaner power.
• 26:13
  SPEAKER_03: Hydrogen continues to be an opportunity that that is that is gets a lot of these federal tax credits, and we'll can, I believe, continue to see that scale.
• 26:24
  SPEAKER_03: And then hydro, which relies on water, to the extent we have that resource, also we will see that continue to grow.
• 26:34
  SPEAKER_03: So there are, I think, many forms of renewable energy that where we will just continue to see the opportunity for growth, efficiency, and price parity.
• 26:45
  SPEAKER_03: And I will say all of the four I just mentioned don't have the exact price parity of wind, solar, and and batteries, but still are still are getting many subsidies and then have these government, these private public partnerships that are enabling them to develop at scale and at scale.
• 27:04
  SPEAKER_02: Yeah, and then maybe in the long run, exactly those prices going down as well.
• 27:08
  SPEAKER_02: Uh, because I mean we talked about it.
• 27:11
  SPEAKER_02: Just how we've seen that in the the wind and solar.
• 27:15
  SPEAKER_02: One thing that I always find interesting, you know, you addressed the first question I had, which is around reliability with these more intermittent types of resources.
• 27:25
  SPEAKER_02: But how do you think then about supply chains and the ability to get the materials you need for all these batteries?
• 27:32
  SPEAKER_02: And even, I mean, we haven't built nuclear reactors for a long time or nuclear plants for a long time.
• 27:37
  SPEAKER_02: So like just um scaling up supply chains to make all of this possible.
• 27:43
  SPEAKER_02: Do you see challenges there?
• 27:45
  SPEAKER_03: I I do think there's challenges, and the ability to execute is will all be determined by operational excellence and where you're operating.
• 27:56
  SPEAKER_03: So Brookfield's competitive advantage is their ability to operate with boots on the ground, understanding local supply chains, and knowing how to plan ahead.
• 28:09
  SPEAKER_03: We have this just incredible procurement team that can tell you years ahead where a solar panel is, where the nuclear reactor parts are, where the every piece of a wind turbine is.
• 28:22
  SPEAKER_03: And that's the type of detail you need in every jurisdiction you're operating in.
• 28:27
  SPEAKER_03: So some of the supply chain issues, and we learned this during COVID, relied on centralized supply chains.
• 28:34
  SPEAKER_03: And what we at Brookfield really extraordinarily have done, and this is just given how important it is to understand the markets we're investing in, have relied on local supply chains.
• 28:47
  SPEAKER_03: So I'd say the number one thing in energy is not to centralize supply chains because that is where we keep, and this this was the lesson during COVID.
• 28:57
  SPEAKER_03: Supply chains that are centralized in a single location just don't allow you to well, oftentimes will slow you down so much, but at the very least, just don't allow you to be to build on time and on budget.
• 29:11
  SPEAKER_03: And the risk and the concentrated risk.
• 29:14
  SPEAKER_03: Exactly.
• 29:14
  SPEAKER_03: And and now with tariffs, the it's even more important that we keep our supply chains local so that there's no question that we have the supplies when they're needed.
• 29:26
  SPEAKER_03: And then the other way to shore up supply chains is to just to understand the costs.
• 29:31
  SPEAKER_03: And the way we do that, every time that we make an investment, we're really clear on what the off-taker agreement is.
• 29:39
  SPEAKER_03: So these power purchase agreements that used to be used to be just much lower, honestly, the cost of energy has lowered.
• 29:48
  SPEAKER_03: Has gone up.
• 29:49
  SPEAKER_03: Yes.
• 29:49
  SPEAKER_03: Their certainty and the stability have just continued to grow.
• 29:53
  SPEAKER_03: So I'd say the two things before anyone invests is one, a lot of clarity on supply chain and making sure it's local.
• 30:02
  SPEAKER_03: And then two, understanding who will use that power afterwards and making sure that they are a partner in understanding what is being developed and what the output of energy will be eventually, I think are two really important components.
• 30:18
  SPEAKER_02: What other risks then are you thinking about as you look at the landscape and look particularly from an investor perspective?
• 30:26
  SPEAKER_03: The um we looked, for example, we we're always looking for value.
• 30:32
  SPEAKER_03: And for despite in 2020 and 2021, we had the largest transition fund ever raised.
• 30:40
  SPEAKER_03: We valuations were sort of out of sync.
• 30:43
  SPEAKER_03: So obviously, with valuations, we always are looking to just maximize the the value for our investors that rely on us.
• 30:53
  SPEAKER_03: And so looking for that opportunity where we always are distinguishing signal from noise, especially in this energy landscape, because there's so much noise, understanding where value is based on a very secure off taker agreement at the end, because that's where the revenue comes in.
• 31:14
  SPEAKER_03: So that our questions around value are not around kind of where where the trends are, but where we see kind of consistent year-over-year value.
• 31:25
  SPEAKER_03: I will use offshore wind as an example.
• 31:27
  SPEAKER_03: There are certain markets in which offshore wind in Europe, for example, really are working and are a great investment.
• 31:34
  SPEAKER_03: In the US, the costs were so high, even before some of the limitations, the government limitations on building, that every component cost of offshore wind was a lot of what you were experiencing in the 90s.
• 31:47
  SPEAKER_03: Yes.
• 31:48
  SPEAKER_03: That that was true about the cost of offshore wind today.
• 31:51
  SPEAKER_03: So understanding that it was a very important part potentially of the energy ecosystem, but the value wasn't there because the costs remained so high.
• 32:03
  SPEAKER_03: And some of that was component par cost, and some of that is cost of developing in the ocean.
• 32:08
  SPEAKER_02: Yeah, and building in the world.
• 32:09
  SPEAKER_03: And building, yes, in in really extraordinarily challenging ways.
• 32:13
  SPEAKER_03: And so that was an area where where, despite the fact that it was all had met all the other requirements, it didn't meet our view of value in certain parts of the US because the component parts were too high and the development risk was too high.
• 32:30
  SPEAKER_03: So it's those are the ways that we're constantly evaluating opportunities, not just based on meeting demand, but also based on the return and the stability.
• 32:42
  SPEAKER_03: And then with energy, sometimes the biggest risks are around development.
• 32:47
  SPEAKER_03: How quickly can it be developed?
• 32:49
  SPEAKER_03: Are the permits available?
• 32:51
  SPEAKER_03: Is there agreement with the regulator, with the utility, with the independent system operator in some instances?
• 32:58
  SPEAKER_03: So really understanding those government risks in such a heavily regulated investment area is really, really important.
• 33:07
  SPEAKER_02: Yeah, so I don't want to go too deeply into this, but transmission we touched on earlier that I feel like I have to bring up in the context of this, just the availability of transmission.
• 33:18
  SPEAKER_02: And I mean, we've seen, right?
• 33:20
  SPEAKER_02: You talked about the fact we sort of saw no new transmission.
• 33:23
  SPEAKER_02: And it's very hard to permit transmission.
• 33:27
  SPEAKER_02: It's critical.
• 33:28
  SPEAKER_02: Do you see how do you see that intersection with as well sustainability?
• 33:36
  SPEAKER_02: Because in many cases there's issues, either quality of life issues or biodiversity issues or otherwise.
• 33:43
  SPEAKER_02: And so again, it's such a very complex issue, but just curious if what you see, and at least as you look ahead.
• 33:57
  SPEAKER_03: So we are seeing in almost every single jurisdiction new transition being approved and actually moving forward, which is which is extraordinary.
• 34:06
  SPEAKER_03: Yes.
• 34:06
  SPEAKER_03: To your question, though, about about sustainability and biodiversity protection, the the practical way that energy is now being supplied with no policy requirements.
• 34:21
  SPEAKER_03: So in California, they have the clean energy goals, which they actually are likely to meet by 2035, with absolutely no mandate or subsidy, will renewables will always be a part of the solution.
• 34:35
  SPEAKER_03: And so in terms of having sustainability because of the parity and because of the speed, they will come on the grid faster than almost any other source.
• 34:45
  SPEAKER_03: And that was true, that's true in Texas, especially after their 10 days of power outages where they had to build renewables to meet demand.
• 34:54
  SPEAKER_03: So as just as a consequence of speed and scale, renewables are part of the solution.
• 35:00
  SPEAKER_03: In terms of the biodiversity and building transmission, so much building, there's a there is a significant trade-off.
• 35:08
  SPEAKER_03: And that that is absolutely true for transmission.
• 35:11
  SPEAKER_03: The the ways in which transmission can now be built alongside each other where the testing has already been done, I think we we know a lot about that.
• 35:21
  SPEAKER_03: The other really important part of transmission will continue to be sharing between states.
• 35:27
  SPEAKER_03: And it's it's what we're starting to see in Europe that they're they're just beginning to think about can there be, not unlike what they were doing with natural gas, can there be sharing between the electricity lines, especially within the EU?
• 35:42
  SPEAKER_03: So once we see this partnership, so for example, if we just take the Western United States, once you start to see those partnerships, you actually have a greater sustainability rather than a new build in California, a new build in Oregon.
• 35:57
  SPEAKER_03: And so that that's an opportunity for more efficient and more sustainable building.
• 36:03
  SPEAKER_02: All right.
• 36:04
  SPEAKER_02: Well, it'd be interesting to see how that that develops.
• 36:07
  SPEAKER_03: We should definitely check back in in a year and see if there's progress.
• 36:10
  SPEAKER_03: So you should check me on that.
• 36:12
  SPEAKER_03: Okay.
• 36:12
  SPEAKER_03: I definitely want to be able to do that.
• 36:13
  SPEAKER_03: I may be more optimistic than others.
• 36:15
  SPEAKER_02: Well, hopefully you're right, actually, in this case.
• 36:18
  SPEAKER_02: Let me ask another question, looping back.
• 36:20
  SPEAKER_02: Um, I want to bring us to um start to move towards reporting.
• 36:25
  SPEAKER_02: But one question, you know, you talked very early in our conversation about cap and trade and your involvement in cap and trade in California.
• 36:33
  SPEAKER_02: And I think there are a lot of questions from people from a reporting perspective, renewable energy credits, cap and trade.
• 36:41
  SPEAKER_02: How effective are some of these mechanisms?
• 36:44
  SPEAKER_02: Obviously, those are too much different mechanisms, but how do you view these mechanisms in terms of if we look more broadly at a goal of reducing emissions, or is it more what type of power is being built?
• 36:58
  SPEAKER_02: Like there's a lot of different mechanisms here, and how do you think about them?
• 37:01
  SPEAKER_03: If we, if I were to answer, if I were to really like widen the aperture and answer that question from the beginning, if when we started thinking through how to reduce emissions, if we had known everything we know today, we would have started with energy, right?
• 37:16
  SPEAKER_03: Like where we are today, we actually just would have started there.
• 37:20
  SPEAKER_03: So we actually wouldn't have done cap and trade first, we would have done clean energy policy first.
• 37:24
  SPEAKER_03: So I'll say that.
• 37:25
  SPEAKER_02: Although there was renewable energy policy.
• 37:27
  SPEAKER_03: There was renewable energy policy and the RPS just in California.
• 37:31
  SPEAKER_03: Yeah, and then some other people.
• 37:33
  SPEAKER_03: Exactly.
• 37:34
  SPEAKER_03: Um, but that has been in terms of this emissions reduction, nothing has been as effective as just renewable energy buildup.
• 37:42
  SPEAKER_03: So I say that because we were so committed to the and remain committed to the policy of cap and trade, but nothing, it turned out, was as effective as building renewable energy, just interestingly.
• 37:55
  SPEAKER_03: But but on cap and trade, cap and trade I think continues to improve.
• 38:01
  SPEAKER_03: And cap and trade did two things.
• 38:03
  SPEAKER_03: Obviously, the the auction in the market in terms of offsets, we are we are seeing demonstrable reductions in emissions just given how high the compliance rates are with cap and trade and how invested corporations are to making sure that they're meeting the requirements.
• 38:22
  SPEAKER_03: And we're seeing that what we thought would happen in California with cap and trade is that we would we would see a carbon market being formed or other folks like we're seeing in Europe joining.
• 38:33
  SPEAKER_03: But the impact just in California alone is is incredibly significant.
• 38:39
  SPEAKER_03: And we're seeing what the because of how and where the credits are allowed, we see this reduction in emissions.
• 38:46
  SPEAKER_03: It's obviously not limited to California because the air is not limited to California.
• 38:50
  SPEAKER_03: So we do see the this overall reduction that's that's pretty remarkable.
• 38:55
  SPEAKER_03: So I'd say as a policy tool, it remains among the most effective.
• 39:01
  SPEAKER_03: As a tool for creating economic incentive, that the only thing I've seen do that at scale effectively.
• 39:11
  SPEAKER_03: Again, I know I'm a broken record, is renewable energy because it's it's it is lower cost.
• 39:16
  SPEAKER_03: Cap and trade is not.
• 39:17
  SPEAKER_03: Yes.
• 39:17
  SPEAKER_03: But has absolutely had the effect that everyone desired, which was this reduction in emissions.
• 39:24
  SPEAKER_03: But to your point, the other probably most effective policy tool is this renewable portfolio standard.
• 39:32
  SPEAKER_03: So the this kind of policy push has before the, especially before the cost parity, we've spent a lot of time talking about, was incredibly useful in terms of bringing down emissions.
• 39:46
  SPEAKER_03: And then the final piece is this, you know, electrify everything.
• 39:52
  SPEAKER_03: We've seen a little bit of a dial back on that.
• 39:55
  SPEAKER_03: So that that includes electric vehicles and electric fleets and blended fuel standards like sustainable aviation fuel that um Brookfield spends a lot of time on as well.
• 40:08
  SPEAKER_03: We those areas we're continuing to see move.
• 40:12
  SPEAKER_03: It'll take a little bit more time to see the reduction in emissions from those than I think we initially expected, in part because of I think some of the changing landscape.
• 40:23
  SPEAKER_02: What do you see then as the role of company goals?
• 40:28
  SPEAKER_02: So we, you know, we see obviously a lot of targets, a lot of goals, net zero, a lot of terminology.
• 40:33
  SPEAKER_02: What role do those have to play then in pushing down emissions?
• 40:39
  SPEAKER_03: I think that corporate pool is by far the most important role in climate today.
• 40:45
  SPEAKER_03: So the hyperscaler commitment that has been unwavering to renewable energy is absolutely driving some of the investment.
• 40:55
  SPEAKER_03: And I I mentioned Brookfield strategies at$30 billion.
• 40:59
  SPEAKER_03: That's because this corporate pull has not stopped.
• 41:02
  SPEAKER_03: And what we see as this huge investment opportunity is to meet that demand with these large corporations.
• 41:09
  SPEAKER_03: And so they they remain a very, very important part of how we execute and deliver and deliver energy and where the private investment dollars are going.
• 41:22
  SPEAKER_03: I think it's it is all of the speed and scale we talked about, but the goals and their their forthright attitude and unwavering commitment to them has been has been a big part of it.
• 41:34
  SPEAKER_03: And and I always do like to point out with with the goals, like everything, there is an 80-20 rule.
• 41:42
  SPEAKER_03: So 20% of energy will continue to be from other sources.
• 41:47
  SPEAKER_03: It is we I sometimes I say it's it's not an energy transition, it's an energy addition because we need so much more.
• 41:56
  SPEAKER_03: So it's it's not that we're gonna get rid of everything else, we're actually just gonna grow it in a more strategic, cleaner way.
• 42:04
  SPEAKER_02: So then that takes us to the role of reporting, I think, because if you have these corporate goals and targets, but without reporting of the information, there's really no way to measure if they're working and if these commitments are working.
• 42:17
  SPEAKER_02: And so, as an investor, how are you using that type of information?
• 42:23
  SPEAKER_02: Or how are investors using that type of information?
• 42:26
  SPEAKER_02: And like what role do you see sustainability reporting playing again in this broader landscape?
• 42:32
  SPEAKER_03: Well, as an investor, it's interesting.
• 42:35
  SPEAKER_03: Uh, I got to see this from two angles.
• 42:37
  SPEAKER_03: One is is California trying to try and to really accomplish some of the goals that we were seeing in Europe and and you all have done an incredible job on it at PWC.
• 42:46
  SPEAKER_03: So, two things.
• 42:48
  SPEAKER_03: One, getting to work on our global transition strategy, we have a whole team that measures impact.
• 42:56
  SPEAKER_03: That before part of our due diligence is looking at the climate goals, looking at whether or not the ability to decrease emissions will be additive.
• 43:06
  SPEAKER_03: So, for example, if you're already a clean company, we actually we maybe would look at investing in you through a different platform, for example.
• 43:14
  SPEAKER_03: But in order to be part of our transition platform, you have to add value to decarbonization.
• 43:21
  SPEAKER_03: So you actually have to bring down emissions.
• 43:24
  SPEAKER_03: We we call that this additive piece.
• 43:26
  SPEAKER_03: And the reporting requirements are so important to measure whether we're just sort of going about and just doing the same thing we've always been doing, or we're actually measurably bringing down emissions, is one.
• 43:41
  SPEAKER_03: And two, the both from an investor perspective and from an insurance company perspective and from a company perspective, more diligent reporting is creating better outcomes and greater value because.
• 44:00
  SPEAKER_03: It's adding a level of intelligence and data that helps us understand where to build, especially given physical risk.
• 44:09
  SPEAKER_03: It helps us much better understand what the risks and liabilities are in a certain area.
• 44:16
  SPEAKER_03: So imagine if if for wildfires in California or in Texas, like if we had known where those risks were greater, we would have built less there.
• 44:28
  SPEAKER_03: So it what the measurement is doing is allowing this smarter building, smarter decision making, and a more accurate view, interestingly, of value.
• 44:40
  SPEAKER_03: And I'll just say a quick word on insurance.
• 44:44
  SPEAKER_03: Insurance is looking at from different perspectives, but when we see different insurance companies in in different markets, what we're seeing is that they have to understand these risks that are now, especially with scope one and two, that are being reported on to really better understand the landscape and then to make better decisions.
• 45:06
  SPEAKER_03: So ultimately, and and I do think you have done a huge amount of work to make sure this isn't overly cumbersome.
• 45:13
  SPEAKER_03: At its most basic, it should be providing better information to execute on better decisions and have more value-added investments.
• 45:24
  SPEAKER_03: Obviously, the caveat is that we all need to work to make sure those are simplified and fair.
• 45:31
  SPEAKER_03: Yes.
• 45:31
  SPEAKER_03: So I will say that that is a very important piece.
• 45:35
  SPEAKER_03: But the intent, I sincerely do believe, is to improve decision making, improve investment opportunity, and improve value.
• 45:42
  SPEAKER_02: What role then do you see uh required reporting, like the laws in California, you know, SB 253 that's going to require this um GHG emissions, CSRD, obviously it's much broader, but also requires emissions.
• 45:58
  SPEAKER_02: I are you how do you see that fitting in with all the voluntary reporting we've had historically?
• 46:04
  SPEAKER_03: I I think this is a lot like what we saw with the renewable portfolio standard, for example.
• 46:10
  SPEAKER_03: When when things shift from, as long as they're reasonable, yes, this is the big caveat.
• 46:14
  SPEAKER_03: When things shift from voluntary to mandated, um, we we do tend to see much greater compliance.
• 46:23
  SPEAKER_03: And with greater compliance, we'll we'll see better decision making and we'll drive better values.
• 46:28
  SPEAKER_03: So it does make sense to me that Europe is having now that that their the omnibus has gone through and and it seems to be the reasonable reporting standard, we we are, I do think that you will continue to see better understanding and better decision making.
• 46:47
  SPEAKER_03: And once those requirements are mandated and equalized among companies, so that you don't have some doing it and some not, so everybody is operating with the same information, you'll see those improved values and decisions at scale.
• 47:02
  SPEAKER_03: And I do think that's really important.
• 47:04
  SPEAKER_02: Yeah, and I think your point you've made that it has to be simplified and it has to be fair.
• 47:09
  SPEAKER_02: You the separate point about the 8020, and I think it's so applicable to us too that if it's too complicated and too hard and too almost ambitious, right, then I think we're actually going to have a worse outcome.
• 47:23
  SPEAKER_02: And, you know, I think that's something that's important as we talk about some of the changes the GHG protocol is proposing, that they also need to look at the current landscape and what investors need and what's realistic for preparers.
• 47:37
  SPEAKER_03: I do.
• 47:38
  SPEAKER_03: I think that's absolutely accurate.
• 47:39
  SPEAKER_03: And and those of us that have been thinking through climate and renewable energy for for a couple decades now, that's always been true, right?
• 47:48
  SPEAKER_03: Like getting it right is better than getting it perfect.
• 47:54
  SPEAKER_03: And I think that is that is what we've learned over and over in the climate space, is that the the 80-20 rule is is the best rule we can all abide by because that is a huge accomplishment.
• 48:06
  SPEAKER_03: Yeah, enormous accomplishment.
• 48:08
  SPEAKER_03: Yeah, could not agree more.
• 48:09
  SPEAKER_03: Um and I do think, and hopefully we'll continue to be able to partner on that and work on it.
• 48:15
  SPEAKER_03: Um and I I do think there's a lot of people that that are really committed to to helping do this work and working with government.
• 48:22
  SPEAKER_03: So I I do hope that that we see some results in that.
• 48:25
  SPEAKER_03: That's another thing you should check back with me on to see.
• 48:27
  SPEAKER_03: Yes, I'm already optimistic.
• 48:30
  SPEAKER_03: If my if my optimism is misplaced, I hope it's not.
• 48:33
  SPEAKER_03: No, I hope so too.
• 48:34
  SPEAKER_02: I definitely have fingers crossed.
• 48:36
  SPEAKER_02: So we I've taken our conversation a lot of directions.
• 48:39
  SPEAKER_02: Just before I wrap things up, any final thoughts that you had that uh you wanted to make sure you were able to share?
• 48:48
  SPEAKER_03: Um, I wonder, I love talking to you.
• 48:50
  SPEAKER_03: I think this has been so great.
• 48:52
  SPEAKER_03: I hope it's it's helpful for other folks.
• 48:54
  SPEAKER_03: Um I I do think that if I were to add just a couple things, I'd I think through the this idea of energy security, we didn't spend a lot of time talking about today, but that is just a a really important piece of our macroeconomics, is ensuring that everybody has energy.
• 49:16
  SPEAKER_03: And I think it's that's a and an understanding how the world's energy will be supplied, I think is continues to be just an area of great curiosity for me, and I think is is going to really drive a lot of decisions, macroeconomics, geopolitical, around the world.
• 49:35
  SPEAKER_03: I think that's just a really important point as we continue to think through through energy.
• 49:42
  SPEAKER_03: The other thing I'd say about energy is it is local.
• 49:46
  SPEAKER_03: And that that is true just around the world.
• 49:49
  SPEAKER_03: We talked about that in the United States, but how we think about energy in every single jurisdiction around the world, certainly that Brookfield operates in, it's so heavily regulated, there is not a one-size-fits-all solution.
• 50:04
  SPEAKER_03: And and making sure that's really clear that we operate in the jurisdiction we're in rather than taking what like a business does in Texas and try to do it in California or try to do it in Minnesota or or right, or or the UK trying to do it in Spain.
• 50:21
  SPEAKER_03: Like we really do have to be mindful of the regulation of the opportunity, of the value, and of what is needed in that jurisdiction.
• 50:29
  SPEAKER_03: So it does take it, it takes a lot more patience and in a lot of ways a lot more expertise than other types of investments.
• 50:36
  SPEAKER_03: So just not to oversimplify the the opportunity is great, the execution is takes a lot of expertise.
• 50:45
  SPEAKER_02: So I'll give a final question that if someone's been listening and now they're inspired, whatever their role is within their company, to have a bigger impact here or to maybe to understand this better.
• 50:56
  SPEAKER_02: Any final words of wisdom from you in terms of if someone's trying to get smarter, what are some of the ways they could think about some of these extremely large issues that we're talking about here?
• 51:09
  SPEAKER_03: Um I think, well, sincerely, I think you've done, I would go back and listen to some of your previous podcasts.
• 51:16
  SPEAKER_03: I'm not just saying that because you're here, but I think you've done a really good job asking some of these deep questions.
• 51:21
  SPEAKER_03: Um I do think that there are some really great academic resources.
• 51:26
  SPEAKER_03: Columbia has a university, has an energy center that's done really some great work.
• 51:31
  SPEAKER_03: And then I I would the other piece I'd say is what we're seeing companies create more and more of, in addition to sustainability, is some of this energy expertise.
• 51:41
  SPEAKER_03: So I would encourage companies to think through now, even if they're not a hyperscaler, to think through an energy plan in the short term and to really develop that expertise in-house because we're seeing that being a big differentiator for companies across the board.
• 51:59
  SPEAKER_03: Given the limitations on power, every single company probably should be thinking about it.
• 52:04
  SPEAKER_03: Yeah.
• 52:05
  SPEAKER_03: In addition to sustainability.
• 52:06
  SPEAKER_02: I think that's a huge a great piece of advice because this goes way beyond sustainability reporting and into strategy and otherwise.
• 52:15
  SPEAKER_02: And if you don't understand what's going on in your local market from a power point of view, it it really is a risk that companies need to manage.
• 52:23
  SPEAKER_03: Absolutely.
• 52:23
  SPEAKER_03: It's one of those things that I think we take power for granted until we don't have it.
• 52:27
  SPEAKER_03: And I think we all should be assuming it's not guaranteed and have a plan for that.
• 52:33
  SPEAKER_02: All right.
• 52:34
  SPEAKER_02: Well, Gail, I could talk to you for a few more hours.
• 52:36
  SPEAKER_02: So you're you're going to have to come back.
• 52:38
  SPEAKER_02: Um, but I really appreciate all your insight and thanks so much for joining us today.
• 52:42
  SPEAKER_02: Thank you.
• 52:43
  SPEAKER_02: I really appreciate you.
• 52:44
  SPEAKER_02: Thank you.
• 52:44
  SPEAKER_02: And then to our listeners, thank you as well so much for joining us today.
• 52:48
  SPEAKER_02: And I hope you join us again next week.
• 52:50
  SPEAKER_02: Uh, and check out the show notes for more resources on some of the topics we've talked about today.
• 52:55
  SPEAKER_02: Thanks again.
• 52:59
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  SPEAKER_01: From Thought Leadership at PWC, I'm Heather Horn.
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