Episode 39: The Cutting Edge with Peter Kelly-Detwiler
Dave Karlsgodt 0:00
Welcome to the campus energy and sustainability podcast. In each episode, we talk with leading campus professionals thought leaders, engineers and innovators addressing the unique challenges and opportunities facing higher ed and corporate campuses. Our discussions will range from energy conservation and efficiency to planning and finance, from building science to social science, from energy systems to food systems. We hope you're ready to learn, share and ultimately accelerate your institution towards solutions. I'm your host, Dave Karlsgodt. I'm a Director of Energy Advisory Services at Brailsford and Dunlavey
Peter Kelly Detwiler 0:38
Where battery is going right now is the tick riding the electric vehicle dog, that is wherever the EV industry wants to go, stationary storage follows because the scale of what's going on in the electric vehicle industry so dwarfs what's happening in the power grid industry. Campuses that have opportunities for renewable methane should certainly take advantage of those because it's a, it's a positive thing to do. Will it save the world by itself? No, but nothing will. Look at a technology and say okay, how does it fit and is it cost effective yet? If the answer's no, don't just discard it. Try and figure out how far out of the box it is in terms of cost effective, and then when's it time to go back and look at it again.
Dave Karlsgodt 1:23
In this episode, we bring back journalist, author, and energy consultant Peter Kelly-Detwiler. We tap Peter's immense knowledge and ability to synthesize energy and decarbonisation trends to explore a list of cutting edge campus decarbonization technologies. You'll hear more preamble in our conversation. So without further ado, please enjoy this May 2021 interview.
Well, Peter, it's great to have you back on the campus energy and sustainability podcast.
Peter Kelly Detwiler 1:56
Thank you. It's a pleasure to be here.
Dave Karlsgodt 1:58
So it's been a while since you were on the show on episode two, back with our mutual friend Jason Delambre. But I think back then we were talking about campuses' relationships with utility companies. But a few things have happened since then; we've had the me too movement, Greta Thunberg, the social justice protests in the wake of George Floyd, a global pandemic, a couple of major elections, a capital riot, a couple of impeachments. I mean, that--a few things have been going on since then. We've even had the global release of TikTok since we last spoke. So maybe let's start with just what have you been up to in the last couple of years, and then maybe we'll get into the future, which is going to be what we're going to talk about mostly today.
Peter Kelly Detwiler 2:38
Sure, we've been certainly living in interesting times. What I've been up to mainly, since we last spoke, is this effort to learn more about how everything is related to the electron. It's so much like an onion, where you peel away one layer, and you think you know X, and then you move into an adjacency and realize, oh, I thought I knew about that and I didn't. So I ended up reading probably three to four hours a day and scanning, I don't know, 250 article titles, and then going down the rabbit hole on a bunch of them in an effort to create an integrated view of what's happening in the transformation of the power grid. And then I was also fortunate enough to put all those learnings together, if you will, into a book that's coming out in a month. So what I try and do is just integrate all kinds of disparate information into some kind of thesis in terms of where this power grid is going, and how society is going to be affected, and then help customers, you know, figure out all the pain that I go through, try and simplify that for other people.
Dave Karlsgodt 3:42
Well, I've enjoyed your vodcasts talking about some of the technology trends. So I thought you'd be the perfect guest for today's episode. We--Kelsey and I've been talking about doing this for a while now, which we want to talk about cutting edge technology. So we've spent time on this podcast talking about actual projects that actual campuses that have gotten done, but we spend a lot of time thinking about, you know what's coming next. And when we're doing our strategic planning work, that's something that comes up a lot; people read an article or they hear about some new, great technology or work. We're working with a lot of research institutions that are actually doing the research on some of these cutting edge technologies. But how do we know what's really likely to come and what we need to pay attention to? And what are some of the technologies that we can largely ignore because they're really not likely to be the trend of the future? So today, what I want to do is just, I have crowdsourced a list from a couple of different sources and just some ideas that I've come up with myself, and I know some things that you brought up in our prep call. And I just want to walk through this list, and our goal will be to figure out, you know, is this something that's real? Is it relevant to higher ed? And you know, when is, when should we expect it to arrive? So let's, let's take an easy one to start with. They know a couple of years ago there was this internet meme about solar freakin' roadways. So let's let's take this, this will be a fun way to get going. So let's start with that as our first topic. So is it real? Is it here? And is it relevant?
Peter Kelly Detwiler 5:13
It's real. Yes, solar freakin' roadways--if you, if you want to call it that--is real in the sense that it's physically viable. And with all these things you kind of start with, can they manifest in the real world? So could be a new storage technology could be building a roadway out of Seoul. Great idea, right? Because you got all this space that cars are driving over, but then you quickly run into, okay, is it cost effective? Ultimately, at the end of the day, is this something that people are willing to pay for? And also these more abstract concerns that quickly turn into roadblocks, do you have for example, driving down that road, does your tire get traction if there, if it's wet, if there's snow, if you now have an accident and somebody gets killed? Is the roadway liable because it doesn't give your tire the same traction that a concrete roadway does? Suddenly you run into all kinds of real world concerns. At the same time, while you have the solar roadway, you also have the solar rights of way on the side. It's way cheaper to just put racks and panels on the side of road. I see him all over the place in Massachusetts where I am. There's acres and acres and acres of empty space on the side of the road, on rooftops, etc. So yeah, it's a, it's an intriguing idea. But to solve the problem, which is to provide clean, low cost electrons, there are better ways to do that right now than trying to engineer a solar surface that people can drive over.
Dave Karlsgodt 6:39
Alright, fair enough. Okay, so that's, so we'll say it is real. It's, I guess, here, at least in pilot stage, but probably not very relevant. Exactly.
Peter Kelly Detwiler 6:49
Quite likely the case. There are easier ways to solve for X.
Dave Karlsgodt 6:52
Okay, fair enough. All right. Let's take another one. This one's more of a non energy technology. But I've heard it talked a lot about in the energy context, which is blockchain.
Peter Kelly Detwiler 7:01
Okay. So, blockchain should not be confused with bitcoin or Ethereum or any of the digital currencies around, that sit around that ecosystem and essentially lock up, if you will, transactions in that distributed ledger. That concept of blockchain itself--everybody was pretty excited about blockchain being able to do miraculous things for the power grid. And a couple years ago, it was the hardest thing since sliced bread, which I never really liked sliced bread that much, but okay. But nonetheless, it still shows signs of promise. For example, last year, the port of Rotterdam with S&P Global and a few other players announced that they had taken a blockchain approach with a micro grid. So, basically matched supply and demand in a smaller grid than the massive utility grid we're in, within the confines of the port of Rotterdam.
And they had batteries and solar and a whole bunch of end use customers and some generation. And what they found was, they did, I think in a month, they recorded 30 billion transactions among just a couple dozen players. And what they found was they were able to increase the utilization of the battery quite significantly and integrate the solar much better. Why? Because they were essentially able to track every actor and what was being produced and consumed, and then integrate it more efficiently, tracking it all in this distributed ledger. At the end of the day power is how much, where for how long, and at what cost. And blockchain is really good at tracking those kinds of transactions. So it still has the possibility in distributed grid where millions of devices, in that transactive future bidirectional flow type grid. Blockchain could still be the enabling technology that allows for the participation of millions of assets in a bidirectional transactive system. We still don't know yet.
Dave Karlsgodt 8:52
All right, so but for a campus, if I'm a campus planner or a facility director to campus, what I'm hearing is it could be relevant into the grid itself or to power markets generally, but maybe not. Is it something I need to worry about or care about?
Peter Kelly Detwiler 9:07
I think it's something worth looking at because of what Rotterdam showed. Because at the end of the day, every campus, and in fact many campuses already are micro grids, so they could be micro grids or they already are. Like University of Austin, Texas has been a micro grid forever. Princeton proved during hurricane or superstorm Sandy when the whole grid went out--same thing with NYU in New York City--that a micro grid was actually a very reliable way to island from the grid and still produce power in the local ecosystem. But if you want to integrate a lot more assets and make them responsive to conditions, prices, that sort of thing, blockchain may still have applicability to campuses; it's worth looking at the proof points, like Rotterdam, and seeing what we can extract from that to figure out in this interactive, more intelligent grid of the future or micro grid, which could be that campus. Blockchain may be the enabling technology to integrate all those pieces
Dave Karlsgodt 10:00
Okay, no, fair enough. All right. It's just got a good ring to it too: blockchain!
Peter Kelly Detwiler 10:04
Yeah.
Dave Karlsgodt 10:05
All right, let's take a more maybe molecular look. Let's go to one that's certainly gotten a lot of press lately, the fundamental element on the periodic table: hydrogen.
Peter Kelly Detwiler 10:16
Ah okay, so hydrogen, the first thing is to understand that it's an energy carrier. In other words, it can be used in a fuel cell, or it can be combusted in a turbine, right. But hydrogen in itself, except in very few instances, doesn't exist like coming out of the ground like oil. There actually are some natural hydrogen locations. But for the most part, you create hydrogen youth through steam methane reformation, where you take CH4, methane, and you strip out the carbon, and then you release the hydrogen. The problem is it's super GHG--greenhouse gas--intensive, right. The other way you could do it is you can do, see methane reformation with carbon capture and storage. So basically, the CO2 gets stripped out, but then you have to capture it and store it underground. Still pretty expensive. But, you know, there's some work being done in that area.
The Holy Grail, though, is green hydrogen, where you take wind--in fact, there's a project just being announced yesterday, Dorset (or the day before), the big wind developer, is taking two 3.6 megawatt offshore wind turbines, and two megawatts of electrolyzer to create hydrogen through the process of electrolysis, taking water and--H2O--and stripping out the H2 from the oxygen. So they just started building the first green hydrogen project to see what the technical challenges are. Right now, green hydrogen is about six times more expensive than the brown or gray hydrogen that we use in making ammonia in chemical industry, and so on and so forth. The thinking though, is if we're going to get to carbon free by 2050, and the International Energy Agency just released a roadmap this morning at two o'clock in the morning, which I saw when it came out, but I haven't had time to look at it. (I'm still on Hawaiian time because I just got back from a flight.) But at any rate, if you want to decarbonize critical industries, like for example, steel (which is 8% of global emissions), long distance shipping, that sort of thing. Hydrogen right now seems like the necessary way to do that in the form of either H2 itself, or ammonia--NH3--or a liquid organic hydrogen compound. So yes, hydrogen has tremendous potential, but we have to do a couple things. First, we have to decrease the cost of the renewable inputs. Second, we have to dramatically decrease the cost of the electrolyzers that essentially strip the H2 from the O in the water, right?
There's a lot of work. There are actually $300 billion worth of projects announced--228 projects that the Hydrogen Council identified about two months ago in a report--80 billion of those are in advanced planning or financial decision already having been made stages. So by 2025, we should have a much clearer view as to what's happening in that space. By 2030, I think we're going to have a pretty good sense as to how big this thing could be and where it's headed. And we're already seeing like big Swedish steel manufacturer, responsible for 10% of Sweden's emissions, 7% of Finland's, they have this project up north of the Arctic Circle where they're making sponge iron from hydrogen. And then they're going to essentially put that in electric arc furnace. So that steel will be carbon free. And Volvo has already said they're going to buy carbon free steel for their chasis. So markets already started develop, the technologies swing into place; this thing looks like it could be real. It's just going to take some time to drive those costs down or hopefully follow the same curve we've seen with batteries and solar modules.
Dave Karlsgodt 13:56
Alright, well, a couple of comments here. First of all, very impressive, because you're doing this off the top of your head as I'm watching you on the video. So I'm pretty, pretty impressed. I don't see you having notes in front of you. So second, if we're talking about campuses, so it sounds like it is real, like it's happening. You just mentioned all those numbers, the number of projects, is it relevant to a higher ed campus? So my question would be more, if I'm a facility director, if I'm thinking about purchasing new boilers, or if I'm thinking about putting a fuel cell, is it likely that in the time horizon that I'm working in--which is probably 10 to 15 years at the most--as a plant or on a campus making a decision today, should I make my decision based on hydrogen?
Peter Kelly Detwiler 14:36
Not yet. I just finished a paper for a very large potential consumer of hydrogen last week. And the thesis there that I came to was, given the cost curves, this doesn't have to be on your radar screen for another probably 10 years as a cost effective option for a campus manager, or data center, somebody looking for, you know, integrated backup power solution, that sort of thing.
Dave Karlsgodt 15:03
All right, well, where do we go next then since--if hydrogen isn't the answer, what about batteries?
Peter Kelly Detwiler 15:11
Okay, so batteries are a really interesting space. And I do actually a four hour course on hydrogen, another four hour course on batteries, which is why this data all lives in my head.
Dave Karlsgodt 15:21
Fair enough.
Peter Kelly Detwiler 15:22
You only have to memorize like 1000 critical facts, and then you can defend yourself at that cocktail party all day long. So batteries. What's really interesting about batteries is at the end of the day, this is all material science, right? It's compounds and ways that elements interact with each other. And so there's a lot of research just at the supercomputer level, where there's one computer, for example, at Lawrence Berkeley National Laboratory that does about 30 quadrillion calculations per second, that researchers use to identify new potential battery chemistry. So they, they ask Cray--the computer--to solve for x, and then she goes in and grabs all the elements of the periodic table and aligns them and comes back with say roughly 200 potential compounds, molecules that have never existed before in the history of the world. Then, robots synthesize that stuff.
It's not just Cray. Contemporary Amperex Technology, the largest battery company in the world in China, they announced last year in July that they were breaking ground on a new 40 acre campus with 1000 scientists with PhDs in material science. So the chase for better stuff is happening all over the place. Solid-State, by the way, will be the next one. Right now we have liquid electrolytes and batteries. Your batteries today, already cost effective in a campus setting and many places. And if they're not today, look tomorrow, because for example, about two years ago, or was a year and a half, Bloomberg New Energy Finance put out a report that said your levelized cost of storage--that is the cost of the batteries themselves, the software around that, the permitting, the electronics--all that was around $300 a megawatt hour in 2018. And by 2020, it was 150. Right?
So just in two years, the levelized costs fell by 50%. That's because the efficiencies in the manufacturing supply chain, in China most of it, are brutally efficient, you know, for the the lithium, for the separator that has the graphite in it, for what's ever is in the cathode, the cobalt, the manganese, the nickel, etc. putting that all together just gets more and more efficient, cheaper and cheaper. Yeah, there's perturbations with costs of inputs, mineral prices, that sort of thing. But at the end of the day, they keep getting cheaper, and they'll cycle lives keep getting longer. So today's battery can give you maybe two or three thousand cycles. Contemporary Amperex again, same company, said for a 10% premium we'll give you 7000-8000 cycles. And Tesla's battery chemist Jeffery Dahn, from the University of Tallahassee, says we can get you probably 15,000 cycles sometime in the near future. So costs coming down, batteries are getting stronger, definitely an integrated capability into campus to integrate more renewables and provide you backup if you need, for example, to backup critical research that a power outage could kill you if it goes away.
Dave Karlsgodt 18:17
So yeah, a couple of things here. So it sounds like, like a 10% premium on a battery that gives you twice as many cycles means your lifespan of the battery is twice as long for 10% more price. So that--
Peter Kelly Detwiler 18:28
Yeah, yeah.
Dave Karlsgodt 18:28
That's a pretty major drop. And then what about batteries generally are typically short duration storage, right? Like in measured in hours, or maybe a day. Is that, is that worth thinking about here versus like seasonal storage or something like that? I know there are sort of--
Peter Kelly Detwiler 18:43
Right.
battery chemistries.
Right, so lithium ion sits in that short space, everything from frequency regulation, instantaneous, keeping the grid at 60 Hertz in this country, and 50 in a lot of the rest of the world. Right now, lithium ion batteries typically work economically to about four hours. So you're seeing all kinds of projects going in with solar, in particular, because of the tax credit and because you have a defined output curve, unlike wind, but you're seeing all kinds of storage projects going in with solar. In fact, companies like NextEra, for example, the largest developer of renewables in the country and probably the world right now, says every time they respond to an RFP, they're always adding a four hour adder; and this year, they're spending a billion dollars on batteries, which they say, well, this year will be enough to power the entire state of Rhode Island for four hours. Another large company just announced a billion dollars of batteries. And then Vistra, the big developer, their CEO announced this week, no more gas plants.
Dave Karlsgodt 19:58
Wow.
Peter Kelly Detwiler 19:45
It was a Wall Street Journal article. They're moving more into batteries and renewables because that's where the future is. So that will solve for X in terms of the grid or a campus being able to sustain 50-60% Like Maui, for example, is 50.8% renewables right now. And it's just wind, solar and batteries. Neighboring Hawaii is already at 60%; they have a little bit of biomass and some pump storage. They're going to 70% with a pump storage, the water. But still the longer duration stuff getting out 6, 10, 12 hours, that's chemistries like flow batteries, it's companies like Energy Vault that raise and lower these huge multi-ton bricks, if you will.
It's a company called advanced renewable, Advanced Rail Energy Storage that just is starting a gravel pit, a 20 acre gravel pit in Nevada, where they're raising and lowering these trains with multi-ton weights on the trains that are absorbing and releasing. Gravitricity, which has mines, looking at mines as deep as 1.2 miles in South Africa, and raising and lowering weights on mines, absorbing and releasing power into the grid. So this is all--and then one that I was reading about this morning that's gonna take liquid CO2 and I think water and sand and storing energy in that, but they say they won't be commercially viable by 2030. So there's like all kinds of--and then another one, form energy, which says, one hour, 150 hours of one megawatt for 150 hours of duration. These are kind of out of the box. We're starting to see their first projects--or another one is Highview, where they have cryogenic; they freeze air, they liquefy air, and when it expands, it expands 700 fold and spins a turbine.
So there's a lot of these longer duration things that will give you a day or two or three days. But that inter-seasonal stuff where you don't have as much sunlight in the winter, or your wind pattern shifts, and you still want to decarbonize the grid, right now the only way it looks like we can store that is still through hydrogen. But you're going to need massive storage caverns and that sort of thing to tide you through from say, summer to fall or winter. All the technologies are kind of now out there floating around. And the real question is, can we scale them and make them viable? And can we do it--in the context of batteries, which are getting cheaper and cheaper, we're gonna grab the first hours of cost effective market, steal away, rip away that soft underbelly, to use a very violent term, and leave the rest of it for the longer term storage that, if it can't find a market from four hours beyond is going to be you know, gasping like a fish on the beach, to keep using these violent images. You know?
Dave Karlsgodt 22:25
Good. Well, I suppose that's relevant in the, in the case of climate change, which sort of has that effect. If we don't figure this out--
Peter Kelly Detwiler 22:32
We'll be gasping on the beach.
Dave Karlsgodt 22:34
Exactly. Well, so some of those technologies sound like something straight out of a Miyazaki film like where there's giant clocks or, you know, weights and stuff around, which is interesting. But, yeah, so it sounds like short term duration, lithium ion or maybe, maybe solid state batteries. Maybe you can spend a minute just explaining what those are, because it's something I kind of have a vague idea, but--
Peter Kelly Detwiler 22:53
Okay.
Dave Karlsgodt 22:54
But it's, that's, that's kind of what we're thinking about there. And then we've got these other--
Peter Kelly Detwiler 22:57
Yeah.
Dave Karlsgodt 22:57
--longer term technologies for more utility scale, I would assume.
Peter Kelly Detwiler 23:01
Correct. So let's jump into batteries a little bit more for a minute, because that's our immediate future. So the first thing to understand around batteries in the grid is that, as I often say, where batteries' going right now is that in the greatest, the tick right in the electric vehicle dog, that is wherever the EV industry wants to go, stationary storage follows, because the scale of what's going on in the electric vehicle industry so dwarfs what's happening in the power grid industry. To give you a sense, right now in China, every week, a new giga factory is being announced.
Dave Karlsgodt 23:33
Wow.
Peter Kelly Detwiler 23:34
Every week, and in this country, it's every four months right now, that's the cadence right? BMW said the other day that 50% of their vehicles by 2030 will be electric. And GM said no more EVs by 2035. A whole bunch of companies have said we're not even doing any more research in internal combustion engines, right. So now within that space, you have two main chemistries. There's--well there's three, the nickel cobalt aluminum, which is test was 500 cycles sort of thing that they've had for a while. Then nickel cobalt manganese, which is about 2000 cycles--which is the predominant chemistry right now used in your Nissan LEAF and your Hyundai Ioniq, lot of others--has the cobalt in it, but they're squeezing the cobalt out, moving away from a ratio of one nickel, one manganese, one cobalt, to eight nickel, one manganese, one cobalt, and even 9.5.5. But that's still got the nasties of the cobalt and cobalt is the biggest percentage cost in the bill of materials.
What's also happening though, is lithium iron phosphate. So still lithium, but now iron phosphate, super abundant metals, right? Inputs, elements. That's now in the lower end model three and will come into more and more cars. It's heavier, though. It's it's not as energy dense. And so it hadn't been the preferred chemistry for cars. But now the costs are coming down so much, they're putting them into cars because it's cheaper.
That's the chemistry that's now migrating more and more into the power grid because it has a higher thermal runaway temperature--it doesn't catch fire as easily. So it's safer to put on site. Not that there are that many battery fires. We've only had two big ones, one in Arizona at a two megawatt facility there, and one in England in Liverpool in an Orsted facility over there, it's like 15 megs, but, and then there were 23 a year and a half ago in Korea, but they were all operator error or installation or not the battery chemistry itself.
Now, that's today's chemistry. Solid state, well, today's chemistry is a liquid electrolyte, and it's inherently less stable, because you can have this dendritic formation where these little filaments reach across and short out the battery from the anode to the cathode, or the other way--I can never remember which. Solid state though, that is a solid electrolyte; it's harder to transfer the electrons in a solid state battery, but it's much more stable.
And it gives you these incredible densities, right? They weigh about half as much for the same energy. So this morning, I was reading about a company that thinks that with a 3D printer, they can print a solid state battery.
Dave Karlsgodt 26:05
Wow.
Peter Kelly Detwiler 26:06
Right? So, and meanwhile, there's all these companies that are chasing solid state, the QuantumScape, one that you all saw when the spec came out. And then, you know, Mercedes Benz, its eCitaro has a sort of semi solid state battery. Toyota, others say roughly five years from now we'll probably see commercially viable solid state batteries. There's still technical issues they have to chase down. But the general consensus is somewhere in the timeframe of five years, although that hadn't been said two years ago, the general consensus was about five years from now we'll have solid state, so it's a little more challenging than most people think. But there's also the semi solid state batteries that 24M has piloted here where I live in the Boston area. And those are now starting to find commerciality too. So a lot of progress in that space.
Dave Karlsgodt 26:55
Let me ask you a couple follow ups there just to make sure I'm tracking.
Peter Kelly Detwiler 26:58
Sure.
Dave Karlsgodt 26:58
So first of all, the solid state doesn't have the nasty metals in it? Like we don't, we're not, we don't have cobalt, or, is that true?
Peter Kelly Detwiler 27:04
Right. It's, it's not as dirty, if you will, as some of the existing chemistries.
Dave Karlsgodt 27:09
Okay.
Peter Kelly Detwiler 27:09
It still was lithium, and that's a problem. But the cobalt issue becomes less of an issue, as I understand it.
Dave Karlsgodt 27:15
Okay.
Peter Kelly Detwiler 27:15
Yeah.
Dave Karlsgodt 27:16
And lithium, lithium, at least there's, while the current markets tend to come from places that are maybe less desirable, sometimes in terms of like, you know, the business practices with how they get the lithium out, at least, there's theoretically ways you can get lithium that don't require that right, unlike cobalt, which is limited in where you can find it. Is that part of the idea?
Peter Kelly Detwiler 27:35
Yeah, cobalt is--about 60% comes from the Democratic Republic of Congo. And it's generally mined in conjunction with nickel or copper. So if you don't, it's not cost effective to mine on its own in most places. So it tends to be pretty inelastic, because you have to build a mind for nickel or copper before you get the cobalt. And 90% of it's processed in China. And there's some issues around, you know, geopolitical competition relying so much on that source.
Lithium, by contrast, the largest supplier, actually, most people think of lithium in the salars and the Altiplano in Chile, Argentina, and Bolivia. But, and that's a pretty big source. But the biggest source of lithium actually happens to be spodumene mines in Australia, hardrock mines, where they mine out the spodumene, and then treat it and turn it into lithium.
Dave Karlsgodt 28:20
Okay.
Peter Kelly Detwiler 28:21
There's spodumene, for example, there's a lithium belt in North Carolina. There's another one out in the border of Nevada and Oregon, which has some environmental issues.
But then there's also an effort to mine lithium, they're already doing geothermal in the Salton Sea in California. And lithium comes up in the brine from the geothermal mining. And so there's now an effort to create a domestic source for lithium. There's a real big concern, Dave, that we're looking at these technologies of the future and understanding that gasoline is on its way out. And really, the criticality of the future is around the power grid, and then the minerals that support and the metals that support e-mobility.
Dave Karlsgodt 29:01
So we're not, yeah, so we're getting away from oil, but not necessarily getting away from mining.
Peter Kelly Detwiler 29:05
Yeah, right. So then the question is, okay, where do we do it? How do we do it most environmentally, sustainably, and cost effectively. And one of the things the US government started doing under the Trump administration is continuing, which I'm a huge fan of is to say, once those batteries get imported from overseas, keep those minerals and materials here. Don't let them go back out for recycling. Recycle them all here. So Argonne National Labs has this thing called recell--R-E-C-E-L-L--(clever) to basically create this loop in this country, and there's already one of, there's a company called Redwood, which is a spin out from Tesla, where they're grabbing all of the constituent elements in the batteries. You shred the battery, and then through hydro and pyrometallurgical processes, you reclaim all the elements. And then there's another group building a factory right now called Li-Cycle--L-I and then cycle--they're building a hub and spoke model starting in Rochester, New York, again to grab all these materials, and then just keep them in this circular loop again and again and again.
Dave Karlsgodt 30:13
Okay, well, so very, very interesting sort of deep dive into batteries. Let's taking it back to then campuses. So if I'm a facility director, I certainly don't want something that's going to catch fire. I certainly don't want something that's, you know, significantly more expensive or whatever. But it sounds like it's, you know, it's here, obviously, there're, you've mentioned some places, it's viable, and it's only going to become more relevant as time goes on.
Peter Kelly Detwiler 30:40
Correct.
Dave Karlsgodt 30:40
Let's talk about the fire for a second. I mean, like you said, there was only a handful of fires, those I assume were not on university campuses; they were probably in some sort of utility installation or--tell me more.
Peter Kelly Detwiler 30:51
Yeah, the two big ones, the Orsted one and the one at the McMicken facility in Arizona, the one there--first of all, the one in Orsted in Liverpool, you can't find any information on it. Aside from the original reports on the fire, I Googled this thing like once a month just because I want to find out more, and there's just no data. It took me a long time even to find out whose cells were being used. And that's only because I happen to have seen sort of a sideways reference to it. And then I call and someone says, Hey, I think this is what's in there. Is that right?
Anyway, the other fire, the McMicken one, that was bad news. It was in a container. And there was a short, their dendritic formation in the battery, right, where those dendrites reached across to cause the short. What the problem was, it was in this container, there was a fire suppression system in the container. And so it released the novec fire suppressant. But that didn't stop what was happening in the battery because there's this quaint little thing called thermal runaway, which is once one cell shorts, it heats up, and when it hits a certain temperature, it now propagates to its neighbor.
And these things actually propagated vertically in the stacks, not horizontally; the heat was all concentrated, but enough to melt the aluminum frames. So as this happened, more gases were released. Fire department came. And they waited for a couple hours, thinking the system was in inert. But inside, what happened was the gases were building up. Soon as they opened the door, now you have the fuel, now you had the oxygen, and you had a source of ignition because the temperature--
Dave Karlsgodt 32:24
Oh no.
Peter Kelly Detwiler 32:24
--was already there. So boom. The firefighter, the lead was thrown 73 feet through a fence. He was in critical condition. Since then, we've learned a lot. They did this--DNV GL did this massive study afterwards, looking at the whole thing, breaking it down, pulling apart the cells. It took them months to de-energize all the batteries in the facility.
Because first of all, you want to suck all the energy out of the batteries, and then examine them to find out what went wrong. And what they found was it was probably a flawed battery chemistry, although LG Chem, the owner of those cells pushes back and says no, it wasn't us. So there's still contention there. But what we learned from that is different ventilation approaches and different ways to deal with it, and also to have sensors in the facility that notify first responders, have an app on the phone. Some companies do that. If they put something in, first responders know it's there. And there's temperature and gas build up indicators. So they can see this on an app before they ever open a door. And then there's companies like Fluence, instead of the Siemens AES joint venture, where they've now built these specialized containers so that they have a better view of what's going on. And you don't have so many celsion and it wouldn't have this issue of thermal runaway.
Dave Karlsgodt 33:37
Okay.
Peter Kelly Detwiler 33:38
The other critical pieces, you also have stranded energy. So there was a fire in a vehicle where some guy was playing a video game. It's in California, near Mountain View, near Tesla's headquarters 20 miles away. And he wasn't paying attention and his car slammed into a barrier--killed him. And then the car was, the batteries were popping. So the fire department comes up, they start to pull the batteries apart.
They call the Tesla guys. They show up in two hours. They finally disassemble a bunch of the battery modules, put the thing on a car carrier, drop it off in San Mateo in California; it reignites, so then they put it out, and then they wait a while, and then the batteries start to go again. So they put it out--this time they douse the heck out of thing. And they leave it in the lot. Day goes by, two days, three days, four days. Everything's good. Five days, everything's good. Sixth day the car catches on fire again.
Dave Karlsgodt 34:16
Wow.
Peter Kelly Detwiler 34:32
So, so you got to be thoughtful. Now at the same time, though, with some of the chemistries--I mean, there's batteries in people's homes all over Australia, all over Hawaii now, all over California, mostly lithium iron phosphate. It doesn't happen that often. You just have to be aware that it's a potential.
Dave Karlsgodt 34:50
All right. Well, I, we probably spent more time talking about the death and destruction from batteries than we meant to but that's alright. It's fun stuff. Um, and so I would imagine then, the trends are going to be about battery safety as one of the major issues that, as companies are marketing this stuff, that's something--if you are thinking about buying a battery, that would be definitely something to dig into, to do your due diligence on. All right, I think we've spent enough on batteries. Let's move on to thermal storage or thermal technologies, because we've talked a little, a lot about electricity. One of the things I've spent a lot of time with campuses on is, you know, what do you do with your steam system, you know; steam you need to combustion, which requires pretty much fossil fuels, unless you have hydrogen, which we've already talked about is at least, you know, a decade away from being really relevant to a campus. What do you see out there in the thermal technology space, so that could include ground source heating, or thermal storage, or any of those technologies?
Peter Kelly Detwiler 35:47
Yeah, the ground source heating is really picking up speed. And partly, that's a function of this whole trend towards beneficial electrification. A lot of states have articulated 100% carbon free by X date, right. So a lot of areas are really pushing to push out natural gas, and certainly oil, in heating systems, and use ground source heat pumps in the 50, roughly 50 degree temperature, you know, from the ground, as cooling in the summer, and heating in the winter. And ground source is a lot less vulnerable than air source heat pumps, for example, where if you have too many of those in a place like New England--or even in Texas, if we'd had a lot of air source heat pumps during the Cold Snap--you're pushing demand up at the wrong time, when everyone else is doing the same thing. Ground source tends to sort of mute that. I think that's going to be one of the leading technologies in the future. And in fact, New York ISO and the utility there, utilities there, think they're actually going to turn into a winter peaking utility by 2040, because ground source heat pumps in particular are going to start to be a predominant technology. There's a lot of potential in that space, and still in technology continuing to evolve. So I think that's going to be an area where we see a lot of growth in the future. And certainly, where there are cost effective opportunities for thermal storage--like what University of Cincinnati did, where they store in water--those kinds of innovative approaches are going to be, I think, increasingly viewed favorably in the future, as costs come down, business models get refined, etc.
Dave Karlsgodt 37:23
Great. Well, we've, we've spent quite a bit of time on that topic in a couple of other episodes, I'm gonna kind of glaze over it for now, just so we can get on to some of the other things that have come up. One that we've talked about, or you alluded to earlier, but maybe we should talk about specifically, is the idea of carbon capture and sequestration. So just, I guess there's a couple of different ways to do this, like sucking carbon out of the atmosphere would be the Holy Grail, I suppose. Sucking carbon out of industrial process would be probably more near term. But just talk to me about that. And again, from the context of a campus, like is this, if I'm thinking about decarbonizing my campus, is capturing the carbon off of my boilers a viable strategy? Or where does that fit into the global mix here?
Peter Kelly Detwiler 38:06
So this is about scale. So first, is there was that direct air capture, but that's diffuse carbon. Like if you really want to get a carbon, it's like robbing the bank: go where the money is, right? What, you know, so you want to be in that stream coming out of the smokestack for carbon capture. Then the question is, okay, where do we do that cost effectively? Exxon Mobil just announced a few weeks ago, they think there's $100 billion potential initiative to do carbon capture in the Houston Ship Channel with all those industries down there that are concentrated together, where they've captured them all and then pipe them.
Because when you think about what is CCS, right, it is, first of all, capturing carbon rich sources, then you gotta pipe it someplace. And then you have to find a reservoir you can stick that carbon in that's going to be sealed and stay there forever. Actually, when I was writing the book, I talked a lot with the GE engineers, the turbine engineers, the hydrogen guys, and they said, well, if you think about the macro system, you either take the carbon out at the front, like you do with green hydrogen, or you grab it at the back end, and then put it somewhere. One issue to think about with carbon capture and storage is, if it's like from natural gas, even if you got all of it and store it all, you would still would have, the numbers I've seen are roughly 15% emissions because you have gas coming into the front of a system with leaks in it, fugitive emissions. And methane is 80 times more effective at trapping the Earth's heat over the first 20 years of its existence than CO2 is.
So you're still creating this ecosystem that's going to leak methane, right? But on the back end, it's potentially more cost effective. However, the technology is not simple. They build these massive towers, and they rain these chemicals down. They try and create this sort of slow motion rain that absorbs the carbon out of the stack as the rain falls, and then they capture the carbon from that and move it out. The problem is like the Terra Nova plant, the one that was one of the demo plants that NRG had down in the Houston area, wasn't, hasn't operated full utilization, and the costs have been fairly prohibitive. So the challenge on the carbon capture side of the equation is you need to build the scale and have investors be confident that if they put their money in, they're going to see a return for that money. That side of the ecosystem isn't developing nearly as fast as the other side with the wind and the batteries and the solar where you're just seeing, you know, Wright's Law kick in, which is every time you double the global cumulative output, costs have fallen by 20%. The back end of CCS is much more complex and much more bespoke, individual one offs. So it sort of defies that economy of scale that the front end possibly offers or does offer.
Dave Karlsgodt 40:50
Alright, so what I'm hearing is there's people trying to figure it out, but it sounds like mostly industry players that are trying to protect their existing assets. Is that a fair summary?
Peter Kelly Detwiler 40:59
Yes, yeah, yeah. And it doesn't scale down to the campus level. You'd be much better off buying offsets or doing something like that than trying to figure out how to take your district, you know, system within the campus and doing carbon capture there. That's way off in the future.
Dave Karlsgodt 41:14
Okay. Yeah. Fair enough. All right. One question that came up, I put out a couple of calls for, for ideas, and I got one from Susan Dorward. And she was asking about building materials. So green cement, let's say, or I know there's also some other technologies like cross laminated timber, and some other things like that. But let's, let's focus on cement, for example. Is that relevant to a campus? There's a lot of construction going on on campuses these days.
Peter Kelly Detwiler 41:41
Yeah, I think, you know, there are a number of startups in that space that are taking carbon and infusing the cement with the carbon. So you're actually doing the capture and storage in the cement. Still small scale right now, and you buy it at a premium. But like anything else, if we get carbon taxes, all those alternative technologies become a lot more viable. Right? At this point in time, we're still giving people a freebie to pollute, because we're not putting a price on that externality. If you change all that, that changes the equation. But yes, it is now a technically viable product, or will be shortly, so is something worth paying attention to. And then certainly the laminated timber construction. I saw a building in Europe that was, I think, 16 stories high. I mean, they know how to do that. And all that carbon is, is stored in that wood for a long period of time. The question is, is it sustainably harvested? How are the forest managed? That sort of thing. But, but certainly, there are opportunities to absorb carbon in your construction materials that you couldn't do, say, a decade ago.
Dave Karlsgodt 42:46
Okay.
Peter Kelly Detwiler 42:46
And that's a moving space.
Dave Karlsgodt 42:47
Yeah, no, that's, that's great. All right, moving on to one we kind of skipped over, I probably should have put this in front of building materials, but renewable gas or bio methane. You hear a lot about, you know, different sources of making methane.
Peter Kelly Detwiler 43:00
Oh, yeah, it's real. Um, you know, there are plenty of companies focusing on that. And certainly, there's a lot of methane that can be taken out of old landfills and can be taken from the agricultural industry with the, with the lagoons of waste from pigs and, and, you know, cattle, etc. So, and it's great, because if it's released into the atmosphere, it does what we just talked about before: it traps a lot of the sun's heat. Versus converting that methane into CO2, essentially, you know, doesn't do that. Right? And so, and you're not burning methane that's just coming from, you know, being fracked, or whatever. So yeah, it's, it is, without question, an environmentally positive thing to do. The challenge is on the scheme of the world, it's not big.
Dave Karlsgodt 43:52
Mhmm.
Peter Kelly Detwiler 43:52
Right? It's a small, it's a niche. It's an effective niche. And it's enough that certain companies can make a living and and do quite well. And certainly campuses that have opportunities for renewable methane should certainly take advantage of those because it's a, it's a positive thing to do. Will it save the world by itself? No, but nothing will. So you know, this is all of the above. And this definitely fits into that strategy.
Dave Karlsgodt 44:17
Okay, fair enough. What's--let's talk a little bit about fuel cells, which maybe is, splits the difference between hydrogen batteries and renewable gas. I know there's a couple of different ways you can run them, but what--are fuel cells relevant? You know, especially, are they here? Are they relevant? I've, I know a couple of campuses that have used them. So I guess I can answer that question myself. But what should we think about them for the future?
Peter Kelly Detwiler 44:41
Yeah, they're here and they're relevant and they are becoming increasingly cost effective because they're essentially, to oversimplify, an inverse electrolyzer. So as electrolyzers get cheaper, fuel cells should get cheaper as well, because it's similar technology stack. And we've seen companies like Bloom and Plug Power and FuelCell Energy and others starting to make more progress in that space. Especially in the last year, a lot of them sold a lot more equity in their companies when stock prices were high. So now they have the capital to scale, and you're starting to see more projects being announced around that particular area.
So yeah, I think fuel cells--the first people who put them in wanted them for reliability, for the most part, in some cases, advanced companies that wanted to be carbon free. I think within the next five years, you'll start to see more and more of them, first, first burning methane, and then ultimately moving into hydrogen as that hydrogen economy develops. So yeah, that's something to pay attention to, because--the one thing I would observe, Dave, is things that look like they're a decade out, what we have seen is, and someone once said, well, very recently said, the interesting thing is the climate news keeps getting worse than we expected, but the solution side keeps getting better than we expected, faster than we expected. So every time you open the toolbox, the tools in there just got better than the last time they were when you opened the box. Fuel cells fit into that.
Dave Karlsgodt 46:14
We just hope that that trend continues, and the one outpaces the other. That's I guess, the challenge. All right, let's go to modular nuclear. This is one that that that brings up a lot of big feelings--as my wife who teaches preschool would talk about--what do we know about modular nuclear? Is it, first of all, relevant for a campus? Are we going to expect campuses with small scale nuclear plants powering their campuses in anytime in the near future? Or, what should we think about that?
Peter Kelly Detwiler 46:45
So, for the most part, and again, again, for this client, I was telling you I did that other work, I had a look at SMR--small modular reactors--just last week. So good timing. The smallest one right now is 25 megawatts; that's out of Argentina. Russia has also some fairly small ones, and they actually have two small operating SMRs right now, but most of these things are, say, 60 kilowatts or even higher. International Atomic Energy Agency says 300 megawatts and smaller is what an SMR is.
Dave Karlsgodt 47:16
You said 60 kilowatts? You need 60--
Peter Kelly Detwiler 47:19
60 megs, excuse me.
Dave Karlsgodt 47:20
Okay.
Peter Kelly Detwiler 47:20
Yeah, 60 megs. And Argentina's is the--25 is the smallest right now. Pardon me. So the first project, like new scale here in this country, put together this million page plus filing for the Nuclear Regulatory Commission--took four years--now they've got the approval of the design. And they actually have the first agreement with a bunch of Utah municipal utilities to deliver these things. But they probably won't be delivered until 2029, 2030. It's still a ways out. And the real challenge is, what do you still, what do you do with a waste? You daisy chain them together. So the first one they're talking is 12 of the 60 megawatt units--I think of they're numbers--because you still need the economy of scale, right? And then you have the issue of what are these things in terms of costs delivered?
And the target numbers I've seen were about $60 a megawatt hour. So I happened to be at a small nuclear financing conference keynoting a couple of years ago, and I put up a presentation in front of them from one of these larger developers in the world of renewables, showing batteries plus wind at 20 to $30 a megawatt hour at a roughly 40 or 50% capacity factor, when you add them all together; solar plus batteries, no subsidies, at 30 to $40 a megawatt hour, competitive with smart with natural gas combined cycle plants. Then these guys are trying to come in at $60 a megawatt hour. So again, they're going to have all the hours that solar produces, plus another four hours of battery shift, much cheaper than what they can deliver. So it's just a very hard value prop right now. Yes, they operate 24/7, and there's the possibility for some dispatch ability because of the modular nature of them. But I think they're going to have difficulty competing with these juggernaut renewables that just keep getting cheaper and cheaper and cheaper by the day as the scale in manufacturing increases, and the technologies keep getting better. Solar panels get better .5% every single year. So you know, that's what their facing.
Dave Karlsgodt 49:29
So probably not relevant to a university campus today. Maybe you--
Peter Kelly Detwiler 49:33
Too big.
Dave Karlsgodt 49:34
Yeah. Too big. Okay. Fair enough. All right, two more. We're gonna go clean coal, if that's even a real thing. And then let's come back to solar and wind, because I know we haven't really, we've kind of alluded to what's happening today, but let's talk about their future as well. But let's go clean coal first.
Peter Kelly Detwiler 49:51
All right, so that, I love the oxymoron, right? So clean coal would, you'd have roughly, if you burn coal in a power plant, you have twice the CO2 that you do from natural gas, right? And gas is cheaper than coal right now. So I mean, people say that renewables killed coal. Not true. The thing with a knife in the back of the coal industry was a fracking well.
Dave Karlsgodt 50:13
Right.
Peter Kelly Detwiler 50:14
That's abundantly clear. And then renewables pile on and kick dirt on the grave when it's already there, and maybe put an old daisy on top of it. But that thing was already gone because of natural gas. So if you have clean anything, it's going to be clean natural gas, because you'll have half the carbon for the same megawatt hour generator.
Dave Karlsgodt 50:31
So in other words, if you were gonna do carbon capture and sequestration, you're not going to do it on a coal plant, you'd do another gas plant. If that would--just the economics make no sense.
Peter Kelly Detwiler 50:38
Yeah.
Dave Karlsgodt 50:39
Okay.
Peter Kelly Detwiler 50:40
Yeah.
Dave Karlsgodt 50:40
All right, we'll, we'll, we'll leave that one as it is. Let's talk about the future of solar and wind. Like, we're not done yet with solar and wind, you've already talked about their costs continuing to go down, the pairing with batteries. What do we have in store for those technologies?
Peter Kelly Detwiler 50:56
So solar, you've got some really interesting promise. There's a great graph from the National Renewable Energy Laboratory every year that shows the conversion efficiencies of probably two dozen technologies. And it's an i-chart, and I always show it in my workshops and say, don't even read these; just look at the lines, they're up and to the right. They just keep getting better at turning photons into electrons, that's all you need to know. And then there are technologies like perovskite, which is the salt that's been somewhat unstable, but now it looks like they've figured out how to use that in solar panels, which will drive the cost down even further.
Solar looks like it's here to stay and just gonna keep getting better. And meanwhile, they're building bigger form factors, the modules themselves, so you get economies of scale, because you don't have to put as much steel and racking etc, and so on and so forth. Solar gets better, for that reason. Wind is a function of, it's a completely different equation. Wind is a function of the cube of the output of the wind speed. So 10 miles an hour versus 20, you get to eight times as much wind. Where's the best wind? Up higher when you get away from the limitations of the topography of trees and landscape, right, onshore. And then offshore we'll talk about in a second. That's all about height. So, assuming there are no NIMBY issues and visual blight issues, now they're figuring out how to take towers and your average tower is like 80 meters right now.
There's a great, another NREL report saying if you go from 80 to 110 meters, you open up the whole southeastern United States to cost effective wind, which it isn't today. There's a, the Chinese have a telescoping tower where each part jacks up the piece inside. So now you're getting up to like 150 meters. There's a company here in this country that has spiral welding towers, and they have a plant now in Texas, where these things can go 150 plus meters. So the higher up you are the economics get better and better. The blades themselves, Vestas just announced this morning, they're developing a technology to recycle all the blades, essentially using chemistry to disaggregate and then use the things again. And then the blades themselves are getting better and they're getting longer.
And they're actually segmenting the blades into pieces, because you can't move long blades down the highway system, you can't get under the bridges and around the clover leafs. So more and more of the stuff probably gets built on site, which is what's going to happen with that spiral welding. So that's what happens onshore. The average turbine right now is like 2.5 megs, but there's already some in Texas that are north of five megawatts. Offshore, the biggest facilities right now are 12 to 14 megawatts for GE's Haliade and 14 to 15 megawatts for Siemens Gamesa, with the blades 107 meters for GE, 108 meters for Siemens Gamesa. One revolution will power a house for a day.
Dave Karlsgodt 53:42
Wow.
Peter Kelly Detwiler 53:43
Right. So, okay, so these things now, these are fixed structures. You put a monopole or a jacket in the ocean on the continental shelf, and then, you know, put the turbines up on top of that. There's only so many places you can put that before you have to go deeper. California, Oregon, no fixed structures; that's all going to be floating. But already, the Europeans are floating eight megawatt structures. When I was at the wind technology Testing Center for the book, they told me they built the shed to test blades. It was 90 meters long. They took the GE blade, and they had to saw off 30 meters to test it.
And he said, but the floating stuff, we don't even know how big it could be. We think it could be 25 megawatts or higher because it floats. So a fixed turbine, think about it, has to take all of the stresses of the marine environment and wind and absorb that in a fixed structure. Floating you impart a lot of those stresses to the ocean because you're just floating around on a spar. So we think those things, we don't even know how big to build the shed. Because these things can be enormous and that's the future of offshore wind is floating. And that's where the future of hydrogen probably is, is floating as well, because these things are likely to be gargantuan.
Dave Karlsgodt 54:57
So you're talking about individual turbines with almost, I guess I'm not quite, half of the modular nuclear capacity.
Peter Kelly Detwiler 55:04
Yeah.
Dave Karlsgodt 55:04
At least. And running at like 50% or something like that?
Peter Kelly Detwiler 55:07
60. 60% capacity factor in the best wind regimes. Yeah, so these things, this is the future, and it's not that far away. I mean, they're already as I said, they're floating eight megawatt machines right now.
Dave Karlsgodt 55:18
Okay, so coming back to a campus, obviously, you're not going to stick, you know, 25 megawatt turbine on your campus, and you probably don't have an ocean in which to float it, at least not a deep sea ocean. Unless we go to Waterworld University or something like that. But what, what does that mean for somebody like an industrial customer like a university? Is it just through the electricity tariff that they're gonna see that? Or how do we think about that?
Peter Kelly Detwiler 55:42
Yeah, so most, you know, if you're a university, the ones that are taking advantage of these utility scale projects, you're doing these power purchase agreements, right. In some cases, it's for to like direct delivery. But in most cases, it's virtual, where the facility could be built in Texas, and there's this thing called additionality, which is without my money that wouldn't have been built. So with my commitment for 10 years, let's say, for a purchase, that allows the wind developer to turn around and say to the bank, hey, I have university X now committed to buy this from me for the next 10 years. Now I can turn around and get the financing for that. On site, you know, in the campus, most campuses are land constrained; they can put solar on a bunch of rooftops, carports, which will be a huge new--carports are going to be one of the next areas after rooftops to get built out. It's already happening. Phoenix, for example, the city's doing all kinds of carports stuff. But yeah, for campuses, you do everything you can on site. First, make yourself efficient, then add the renewables, sometimes the batteries, and then if you need to continue to decarbonize, it usually involves some kind of a contractual structure with an external party developing utility scale stuff, which is cheaper than what you're doing on site anyway, because of the scale.
Dave Karlsgodt 56:52
Fair enough. Fair enough. Any, any technologies we didn't touch on that we should have today? I'm trying to think of any other--
Peter Kelly Detwiler 56:59
Well,
Dave Karlsgodt 57:00
--crazy ideas that I missed. Go ahead.
Peter Kelly Detwiler 57:01
Well, I mean, the electric vehicle thing, like every campus should be eyeing electric vehicles, right, because as part of your, your scope one direct emissions, every single car you have on your campus, or whatever vehicles you're using, it's time to electrify those. Now the costs are coming down, so the, the total cost of ownership is already cheaper for an electric vehicle, in most cases, than it is for an internal combustion engine. Plus, those vehicles have a battery and if their batteries are on wheels, and we're starting to see vehicle to create bidirectionality really start to take shape. So for example, Maryland, Montgomery County just leased 326 school buses that will be bidirectional. So there'll be selling services back to the grid, making the cost of ownership even cheaper. So if you're a campus, anybody with a fleet of vehicles, you should start to be looking at EVs. Because if they're not here today, within two years, you're going to have a model for what you want.
Dave Karlsgodt 58:01
But it sounds like there's some purchasing options too that doesn't require you to put all the capital upfront too. Is that--
Peter Kelly Detwiler 58:07
Yeah.
Dave Karlsgodt 58:07
I just heard.
Peter Kelly Detwiler 58:08
Yeah, more and more financial intermediaries lease understanding that the challenge may be financing for these entities, and they can access cheap, cheaper money and structure it in a certain way. So yeah.
Dave Karlsgodt 58:18
Very cool. Well, I'm sure I could talk to you all day. But I know you got other things to do. So let's maybe wrap things up. But, tell me about the book that you're writing. It's coming out, what in a month?
Peter Kelly Detwiler 58:28
Yes, it's coming out on the 15th of June, and it's called The Energy Switch. And I've talked, it's basically how, you know, customers and corporations are changing the power grid. People say, why did you write the book and I said, because when I was a senior vice president at Constellation, I was arguably one of the world's experts--very debatable--on demand response, what I was doing, paying customers not to use power during periods of peak demand. But I didn't understand anything about turbines and how they worked and how they needed to change to integrate solar. I didn't understand what was going on with batteries, solar, wind, etc. In other words, I was a complete idiot with respect to everything else in the space.
So I wrote 300 plus articles for Forbes, interviewing all these different CEOs, battery companies, CEO of IKEA, why was he in the climate march, etc., in this effort to integrate all the pieces and make sense of this and contextualize it because I couldn't find that resource. So I figured I might as well make it. And the industry doesn't have enough storytellers. Here's this transformation, $100 trillion between now and 2050--130 trillion according the International Renewable Energy Agency--and has almost zero storytellers. We're living in the biggest transformation humanity's ever tried to accomplish as a society. And virtually nobody understands what's going on, why it's going on, how fast it's going to happen, who's going to get their capital completely incinerated, and who's going to win?
And so the book is an effort to identify various characters in that space and tell their story using their stories and on ramp than to get into the nitty gritty of how many 1000s of megawatts of this are being installed, what's the cost of X or Y. I'm a trained economist, in theory. So as my son says, you have a lot of economics in the book. But economics are what drives everything. Because fundamentally, that's the tool we have decided, as capitalist societies, it we're going to impart our values to in a sense. It's our new religion, whether we like it or not. And so that's the book. That's the framework. And I'm just trying to help people make sense of what's happening in the space all the way from the blockchain to the cyber to all the technologies and the economics in the middle.
Dave Karlsgodt 1:00:34
Just to close this out. If I'm a campus facility manager, or a sustainability director, or, you know, the CFO of a campus, what should I take away from this conversation? What should I, how should I think about all this emerging technology? It's confusing. It's exciting. It's, it's a little scary.
Peter Kelly Detwiler 1:00:52
Yeah, it's somewhat bewildering. So the first step is to understand your goals. And most do, I mean, most, it's impressive how much thought campuses have given to this issue, their tip of the spear on that. So the next step is, okay, for the problems I'm trying to solve, identifying what potential technologies are in the box or what ones might be outside. And, and the thing is, is not to forecast, because forecasts are no good anymore. Change is happening too fast. The real critical thing is to look at a technology and say, okay, how does it fit? And is it cost effective yet? If the answer's no, don't just discard it; try and figure out how far out of the box it is in terms of cost effective?
And then when's it time to go back and look at it again, because all these constituent costs are falling so quickly, that it really does make sense to come back and say, oh, this battery wasn't cost effective a few years ago. Now it is. And I can tell you from experience, I was doing work with a campus trying to get them to look at some of these. And they're like, no, no, no, that's not going to happen, battery being one of them. Now, four years later, that battery sits square as in the middle of potential cost effective solutions. So you have to just keep on revisiting these things, looking at who the actors are, and then go with the reputable ones. Go with someone who has a balance sheet, that if something goes wrong, you know who to sue. Good fences make good neighbors. Good talk, good contracts make good business. So be really diligent about who you're finding as your partners and making sure those contracts clearly identify all the potential outcomes, because this is new stuff. And you want to inoculate yourself as much as possible against the potential risk out there.
Dave Karlsgodt 1:02:31
Yeah, that's that's pretty sound advice, I think right there. Well, Peter, I really appreciate you taking the time. I know you're still kind of getting over your jetlag after your adventures in Hawaii. Welcome back to Massachusetts. And I hope to have you back on the podcast, maybe in another 36 episodes or whatever it's been.
Peter Kelly Detwiler 1:02:49
Well, thank you, Dave. It's been a real pleasure. I'm sure that next time we do talk, we'll have a whole host of new things to discuss, given the pace of of change in this industry.
Dave Karlsgodt 1:02:57
I look forward to the flux capacitor conversation.
Peter Kelly Detwiler 1:03:01
Sooner or later.
Dave Karlsgodt 1:03:02
Excellent. All right. Well, thank you very much.
Peter Kelly Detwiler 1:03:04
My pleasure.
Dave Karlsgodt 1:03:05
That's it for this episode. Thanks to Kelsey Harding for her production assistance. Our music is Under The Radar courtesy of Dallas based musician and composer, Gio Washington-Wright and his studio Big Band. If you'd like to follow our show on social media, our Twitter handle is @energypodcast. You can also find us on LinkedIn, just search for campus energy and sustainability podcast. If you'd like to support the show, consider leaving a rating or review on iTunes. As always, thanks for listening.
Transcribed by https://otter.ai