0:02

Hello and welcome to the Energy Gang

0:04

with the special edition from the distributor

0:07

conference in Orlando and it cracks. Distributor.

0:14

Is a big event for the electricity transmission

0:16

and distribution and straight in fact it's the

0:18

biggest in North America. Being.

0:20

Here is a fantastic opportunity to talk to

0:22

many of the leading figures from companies that

0:24

provide technology for moving and managing electricity, and

0:27

from the companies that use that technology, including

0:29

particularly utilities. Later on, in this episode, you

0:31

can hear my conversations with Antony Allah Hu,

0:33

the head of Hitachi Energy in North America

0:35

with Tom Dietrich of I Trump, with Quinn

0:38

that Yamamah from the utility Pgd and with

0:40

Zach Cast is a futurist until last year

0:42

was an executive at Open A I. As

0:45

you might imagine, A I has been a hot

0:47

topic of this event. It's been talked about both

0:50

as a source of new demand for electricity and

0:52

of a tool for managing the new strains on

0:54

the grid. To discuss what

0:56

these latest breakthroughs in A I mean

0:58

for energy I spoke first with Hossain.

1:00

Shell is the chief technologist for eight

1:03

of us. Amazon Web Services has I

1:05

think so much for joining us today.

1:07

Thank you for having me excited! So

1:09

Ai does seem to be the hot

1:11

topic already have just come from the

1:13

plenary session, the opening keynote speeches in

1:15

the main hall A I was a

1:18

consistent theme running through everything and everyone

1:20

was talking about their when you think

1:22

about A W S his approach to

1:24

a I in the. Energy Industry to

1:26

Power and utilities. What are you

1:28

offering? Pay? Absolutely. So it's really

1:30

exciting times. It's definitely the topic

1:32

of the moment and I believe

1:34

in the company really believes that

1:36

this gonna be transformative technology for

1:38

the next decades. Our approach really

1:40

around make in Gen Vi practical,

1:42

cutting through the hype and helping

1:44

our customers do the work that

1:46

they want to do with it

1:49

right and trying to find something

1:51

that is secure, flexible, and capable

1:53

of doing the things that they

1:55

want to. Do and all of those

1:57

are available through our services in the Thompson.

1:59

So a. Have you talked about

2:01

quite a bit more? Manage again Hogarth

2:03

do with had quality people. Come on

2:05

and talk about the possibilities of a

2:08

technology opens up and very much with

2:10

a theme here distributed among excitement. the

2:12

expression game changer I think have been

2:14

used about three or four times the

2:16

rate in my hearing you've just been

2:18

talking about the exciting potential that you

2:21

see. I have tended personally to be

2:23

a bit of a skeptic. I have

2:25

felt like there's a lot of excitement

2:27

around the sort of when you Michael

2:29

the. Latest iteration of a i

2:31

intend zones large language models and

2:33

so on which have clearly have

2:36

enormous implications for language face to

2:38

ignite. It was eventually for journalism

2:40

and the law and teaching and

2:42

so I can see really where

2:44

these new ai tim of these

2:46

make a massive difference to vote

2:48

What I feel skeptical about his

2:50

verification to energy where it seems

2:53

like maybe some of the use

2:55

cases are not so well demonstrated.

2:57

Yes and as as a lot

2:59

of. Talk about from it is

3:01

essential in principle, not so much

3:03

really concrete demonstration. The oh what's

3:05

that he beings on and what's

3:07

really being changed on the ground

3:10

right now by I am I

3:12

wrong to have been impressions you

3:14

think it is changing a lot

3:16

already. Eat or is this more

3:18

kind of something? Much snow for

3:20

the future and something that people

3:22

are kind of speculating about. I'm

3:24

looking forward to Rome that you

3:26

demonstrating right now. I think we're

3:28

in the early stages. Right as

3:30

I said sen the eyes as a discipline

3:32

has been around for a while but from

3:35

a technology and enablement and the ability to

3:37

use it and is large scale is fairly

3:39

new with advantage of Tennessee be t that

3:41

going to put it up in the market

3:44

and it's most people to the possibilities. but

3:46

to be honest with you the year to

3:48

the twenty three has been a lot of

3:50

feel season pilots and people trying to understand

3:53

what they can do with just like as

3:55

any new to college ethics. And

3:59

so. So I would say 2023 has been

4:01

a significant amount of piloting and

4:04

POCing and trying different things and

4:06

different ideas. Working with partners like

4:08

Accenture, they use CodeWhisper, which is

4:10

a GenAI based code suggestion system

4:12

that we have. They've seen 30%

4:14

more productivity from

4:17

their engineering developers. So we're

4:20

seeing some of those cases, right? Other

4:22

customers are using it around data, like

4:24

you said. It's very text specific and

4:26

also there's multi-modular, right, with video and

4:28

voice, et cetera. And energy customers and

4:31

energy industry is rich with data and documents

4:33

that we don't know what to do

4:35

with and where, what information, what insights are

4:37

there. So some of the use cases that

4:39

we're looking at are looking at this corpus

4:42

of data sets and documents that have just

4:44

been sent there and drives for decades

4:46

and trying to glean insights from it and

4:48

see what we can do with it and

4:51

what our customers can actually find value, right?

4:53

But I believe 2024 is going to see

4:56

a significant scale of deployment to

4:58

production, applications and solutions. 2023,

5:00

mostly POC. Right,

5:03

got it. And POC then proof

5:05

of concept. Proof of concept, yes, absolutely. So

5:07

as you say, so when people are moving

5:09

then, you think in 2024 to actually deploying

5:11

these applications practically, and you

5:13

talk about in energy sort of going through the

5:16

vast reams of text and pages that are out

5:18

there that nobody ever looks at at the moment.

5:20

So this is what, typically regulatory filings, things like

5:22

that. That, but also like in the case of

5:24

oil and gas, for example, there's a lot of

5:26

drilling reports, there's a lot of

5:28

production reports, there's a lot of content that is generated that

5:31

simply is forgotten after a project

5:33

is done. And a lot of

5:35

insights and data driven decisions are

5:38

buried within these PowerPoints or PDFs or Word

5:40

documents and people are starting to find it.

5:42

You've mentioned also law, we're seeing customers looking

5:45

at warranties and looking at documents that could

5:47

potentially allow them to have profit recovery use

5:49

cases. And so we're seeing a lot of

5:51

that, but yes, absolutely. That's very interesting. And

5:53

that's something you think then we should really

5:55

be looking out for this year to see

5:58

those practical implications taking effect. Absolutely.

6:00

So something else I often think about

6:02

in this context of AI is the

6:04

terminology seems to be very significant and

6:06

the terminology goes through these kind of

6:09

fashions and things become buzzwords and they

6:11

go into fashion and go out of

6:13

fashion. So now it's fashionable to talk

6:15

about AI. It feels like people have

6:17

been talking about AI in the context

6:19

of business in general, industry in general,

6:22

energy in particular for at least a

6:24

decade, maybe 15 years or so. It's

6:26

often been known as machine learning there

6:28

and people have used the term AI

6:30

and machine learning pretty well interchangeably.

6:34

But now it's being called AI and people

6:37

don't seem to talk about machine learning so

6:39

much because AI is exactly, people talk about

6:41

generative AI as being the kind of the

6:44

new new thing and that's the hot thing

6:46

that people are excited about. What are the

6:48

real differences here? Is what we're talking about

6:50

fundamentally different from the machine learning that people

6:52

have been talking about for many years now

6:55

or is it just essentially the same thing

6:57

being rebranded? Well, it's really

6:59

different disciplines when it comes to

7:01

using data and technology to glean

7:03

insights into the information that's provided.

7:06

Machine learning is the traditional machine learning.

7:08

You feed it data, you train it, it

7:10

comes back with learning information from that data

7:12

set. AI is when it learns

7:15

on its own and there's different reinforcement

7:17

learning techniques. There's very different disciplines. Generative

7:20

AI in particular is using large

7:22

language models and large

7:24

content models to generate new text.

7:26

Simply put, we can go for

7:28

days describing those different disciplines but

7:30

at least for today we'll talk

7:33

about that. What's interesting like

7:35

you said is that in our engagement

7:37

and a lot of times when we

7:39

sit down with our customers and work

7:41

backwards from their problems, 40% of the

7:43

problems that they're trying

7:46

to solve are easily solvable by

7:48

existing machine learning models and machine

7:50

learning algorithms that have been used

7:52

for decades. It is

7:54

our job as technologists to sit down

7:56

with our customers and explain the differences

7:58

and explain where. One works better

8:00

than the Of and so you know

8:03

We get passed by many of our

8:05

executive board some customers on for me

8:07

to them and explaining to them the

8:09

differences helping them and of id a

8:11

new ideas and use cases that we

8:13

can use and then we can target

8:15

each one of those use cases with

8:17

the proper technology in the proper implementation

8:19

of machine learning arcs. Sir

8:22

Francis whatever uses people often since talk

8:24

about is using data to optimize of

8:26

assholes of a powerful on the site.

8:28

Second, every industry example that's something that's

8:31

really a machine learning job, as in

8:33

not really what you call something for

8:35

generative. I'm correct. A Traditionally yes, you

8:37

read a lot of sensor data from

8:39

Atlanta You know than any kind of

8:41

machinery that generates a significant amount of

8:43

inputs and bait on temperatures and pressures

8:46

censoring fit in as a model. The

8:48

mama learns from it and then provides

8:50

predictions. An inference and zone that.

8:54

On when people for instance talk about

8:56

grid optimization as well some of the

8:58

increasingly complex problems that imminent ending with

9:00

managing grids about a use. that's also

9:03

what again less radio machine learning all

9:05

it is. It's complicated to they think

9:07

you can merge different disciplines together to

9:09

create the right solution. or you can

9:12

use machine learning for the typical censor

9:14

nina and ingestion data that is to

9:16

be used in the past. Learn and

9:18

educate the model and train the model

9:20

to be within such as you can

9:23

also merged with. New datasets, synthetic thing

9:25

and were seen him some of the use

9:27

cases that is blending physics based model with

9:30

this is to go and database models and

9:32

so you're seeing that world merging and

9:34

becoming very gray is when it comes to

9:36

that. But you know I'm really really looking

9:38

forward to see what customers are going to

9:41

do and how we can use all

9:43

of these disciplines that available today for our

9:45

customers to come up with. His sons are

9:47

that's really interesting thanks so much and that's

9:50

really helpful and clarifying they term plank or

9:52

so when you think longer term. About

9:54

the potential of a in energy come

9:56

back to the super thick and five

9:58

years or ten years. Twenty nine,

10:00

Twenty Thirty Four, what are people

10:03

going to be talking about Van

10:05

and mean, what is that longer

10:07

term potential and how do you

10:09

think ultimately I will change the

10:12

emphasis veins reputable. I'm hoping and

10:14

five years we can see a

10:16

lot of these use cases to

10:18

fruition. You see a lot of

10:21

business empire that's driving better energy

10:23

efficiency, better grid optimization scenarios, and

10:25

really see the fruits of experimentation.

10:27

What's happening now in the industry.

10:30

To be true and we're going to

10:32

see a lot of different implementations of

10:34

these Muslims as models and I'm really

10:36

really hoping that customers have been a

10:38

see the benefit in our partners and

10:40

continue to grow the business for them

10:42

and see a difference in the lives

10:44

to their customers but also their operations

10:46

their existing for you mentioned good integration.

10:48

The other aspects of Ai that's been

10:50

much discussed already here at the Service

10:52

Egg is the question of the increasing

10:54

load. That's gonna be great advice over

10:56

new data centers that are going to

10:58

be delivering an Ai. Applications that future the

11:01

was an executive from you Can as he

11:03

just speaking of the my and whole saying

11:05

that it used to be a big deal

11:07

for them when they had something we'd like

11:09

to add ten megawatts of twenty megawatts of

11:11

alone and now they've got a number of

11:14

data centers talk about Would like to add

11:16

oh gigawatt of like. It's clearly something that

11:18

is making a big difference to projects and

11:20

both. It was a smart in the future

11:22

on I guess some of that demand is

11:24

coming from you as a W S, how

11:26

do you manage? That in particular has given

11:29

that you have very. Demanding commitments in

11:31

terms of reducing emissions from relying

11:33

on renewable energy? How do you

11:35

square those two things away together

11:37

and managed to me that increased

11:39

demand for cure that extra power

11:41

you're gonna need while also reducing

11:44

emissions. I'm glad you mentioned Duke.

11:46

Duke is one of our partners

11:48

with and working with them significant

11:50

harness on some of the grid

11:52

optimization work. were helping them build

11:54

cloud native technology based sweet of

11:56

applications to really look at things

11:59

that are. Enabling Technologies right

12:01

in the meeting before the large,

12:03

upscale and updated efforts are going

12:05

on of infrastructure. So for example,

12:07

we're working with them on leveraging

12:09

not only machine learning, but also

12:11

traditional I Performance computing to communities

12:13

that was available in eight of

12:15

us to do simulations into power

12:17

flow simulations and look at how

12:19

they can optimize apology optimization. At

12:21

such and such, there's a significant

12:23

amount of different solutions that I'm

12:25

a foreigner. To

12:28

look at like on an optimization. Advance

12:30

our flow simulations and really trying

12:32

to see where can you take

12:34

already on more capacity without necessarily

12:36

burdening the grid that exists today

12:39

in the hope of improving in

12:41

the future. And so we realized

12:43

of this fake partnerships with our

12:45

partners with technology providers like ourselves

12:47

but also with regulators, providers and

12:49

of and senses. Yeah

12:52

and those grid enhancing themselves you something

12:54

particular important given how hard it is

12:56

to fill infrastructure for a in most

12:59

of the devote. Wells I guess you'd

13:01

say Utterance Power transmission a particular is

13:03

one of those things that seems to

13:05

be really hard to get done and

13:07

clearly given of his new demand for

13:09

the coming on the great post on

13:12

the demand side and because of increased

13:14

verbal renewables more went on the great

13:16

and so on the exercising whole new

13:18

challenges in needs a lot more transmission.

13:20

It's hard to build that transmission so

13:22

severe that you can do anything to

13:25

upgrade the great Improvement network without actually

13:27

adding physically more capacity and other really

13:29

hold it's. absolutely important and there's a

13:31

lot of things that were doing internally as

13:33

well for example were doing a lot of

13:35

work around our water consumption cooling in our

13:38

our innocence site a game has been a

13:40

subject will not be writing increasingly concerned about

13:42

the brightness yeah right in with our commitment

13:44

to be want a positive by twenty thirty

13:47

will be given more water out of beauty

13:49

that we consume no data centers we are

13:51

as you know one of the largest mobile

13:53

and as if providers we will be ah

13:55

hundred percent plans and twenty twenty five or

13:58

way had were ninety five percent at the

14:00

moment, we can help our customers

14:02

decrease their carbon footprint by using our services

14:04

up to close to 80% and 95% once

14:06

we're 100% renewable. So

14:10

we're doing a lot of things to encourage. Our

14:12

hope is that we compete in that

14:15

space. We're not going to be able

14:17

to solve, unfortunately, climate change by ourselves,

14:19

but we want our competitors and others

14:21

to also innovate with us. And we

14:23

want to push that limit for what

14:25

we're doing. A lot of our climate

14:27

pledges are ambitious goals, net zero by

14:29

2040, and that's going to take a lot of

14:31

innovation, a lot of technology. So you would be absolutely

14:33

confident then that you will be able to get to net

14:36

zero emissions by 2040. You're still totally

14:38

on track for that. Absolutely, we are. We're

14:40

seeing results. Like I said, our carbon intensity

14:42

reduced by 7% in 23. We

14:45

are on our way to be 100% renewable by 2025. We're

14:49

working on, across Amazon, not only AWS,

14:51

for example. We've reduced package waste by

14:54

close to 2 million tons by simply

14:56

reducing our package size by about 41%.

15:00

We've introduced a lot more EVs

15:02

into our shipping and delivery

15:04

system, about 9,000, and

15:06

145 million packages were delivered using these

15:08

trucks. So we're definitely seeing results. And

15:10

we will continue to innovate, of course.

15:13

It's not going to take only us,

15:15

and we're hoping to see what the

15:17

innovation continues across the industry. And those

15:19

challenges that obviously people see in terms

15:21

of being renewable 24-7. Variable

15:24

renewables obviously don't get you all the way

15:26

there. People look at a lot

15:28

of different solutions, like using biofuels, maybe

15:31

high-diesel and generators, buy gas. People

15:33

talk about nuclear maybe as being

15:35

part of the solution. How do

15:37

you see the potential for getting

15:39

to truly 100% renewable

15:42

energy 24-7, around the clock, given

15:44

that, as I say, you can get a lot

15:46

of the way with wind and solar, but you

15:48

can't get all the way there? Well, I think

15:51

technology is going to play a significant part in

15:53

that, but it's also going to take regulators and

15:55

it's going to take partners and customers themselves to

15:57

transform. In Amazon, we are dedicated to working across

15:59

the energy. industry all up. We work

16:01

with customers to innovate what they're doing

16:03

today in the renewable space, but also

16:05

in the oil and gas space. We

16:07

will continue to do so, we'll continue

16:09

to help our customers be as efficient

16:11

and as innovative as possible using our

16:13

technologies and we will continue to innovate

16:15

ourselves across all of the different stacks

16:17

that I mentioned from infrastructure to services

16:19

to the projects that we're doing in

16:21

this space, whether it's renewable projects or

16:23

cutting our own footprint ourselves. I'm

16:26

saying, Gail, thank you very much indeed. Absolutely. Thank you so

16:28

much for having me. One of

16:30

the keynotes because of the event was a former

16:32

executive of a company that's been at the heart

16:34

of the latest breakthroughs in artificial intelligence, OpenAI.

16:38

Up until last year, Zach Cass was the head of

16:40

GoToMarket. Zach, thanks very much for joining us today. Thanks

16:42

for having me in. So you're

16:44

not an energy specialist by background, but you're coming

16:47

here talking about this energy event. What's the message

16:49

you want to give people? What do you think

16:51

the energy industry needs to know about AI? Generally,

16:54

my message is that of abundance,

16:56

is giving people the permission to

16:59

explore a world where we might

17:01

have plentiful energy, foodstuffs, water, education,

17:04

healthcare, which is my mission, right?

17:06

To provide a counter narrative to

17:08

a dystopian or an otherwise

17:10

dystopian prevailing sentiment. At an energy conference,

17:13

it's particularly interesting because energy will be

17:15

both a beneficiary and a benefactor of

17:17

AI insofar as we're going to need

17:19

a ton of it to build these

17:22

machines and run them. And

17:24

presumably AGI will end

17:26

up producing fusion and other major

17:28

energy breakthroughs which should change how

17:30

we view energy forever. So let's

17:32

unpack that a bit and talk

17:34

about those two aspects of AI

17:36

energy in turn. Firstly, on the demand

17:39

side, if you like, so what AI needs

17:41

from energy and what its needs are in

17:43

terms of energy. You talk

17:45

about energy then being a beneficiary, you

17:48

could also say, obviously, that's one of the big

17:50

problems with AI is the scale of the energy

17:52

demand, particularly obviously at a time when we're trying

17:54

in general to reduce energy demand or at least

17:57

improve energy efficiency in the economy and a lot

17:59

of companies. They have goes for reducing

18:01

emissions. The world as a whole is

18:03

aiming for that zero emissions The unemployed

18:05

in the not too distant future in

18:07

order to avoid the worst effects of

18:09

climate change I looked attention like a

18:12

big problem Last, how do you think

18:14

about that challenges and you have a

18:16

sense of what you think the scale

18:18

of the increase energy demand for my

18:20

eyes gonna be So first will say

18:22

I think it's pretty clear that Ai

18:24

is going to present the biggest challenge

18:26

faced by the grid or by energy

18:29

providers. Yes, It doesn't mean

18:31

that we should try way from. I

18:33

don't think that of all the things

18:35

that you could compromise on right now

18:37

in terms of supplying energy A I

18:39

feel like one of the few things

18:41

in this world that actually give us

18:44

a path out of the climate crisis

18:46

that we put ourselves in a D.

18:48

I almost certainly begets few him among

18:50

many other really positive things. So if

18:52

you are going to rate limit something

18:54

I wouldn't start with a I for

18:57

there are from as reasons. That being

18:59

said, the. Inside Baseball suggests that

19:01

the scale of energy required is going

19:03

to outstrip the current supply by like

19:05

an order of magnitude current that what

19:07

we think we need is so much

19:10

more than the grid currently has, and

19:12

way more than we know how to

19:14

store and distribute to. the answers have

19:16

to be found and either major breakthroughs

19:19

or massive improvements in the efficiency by

19:21

which we train and run these models

19:23

and I think both one of happen.

19:25

It's been fascinating to me just walking

19:27

around. the conversations I've had with the.

19:30

Whole so far this time for the

19:32

kind of the two worlds colliding says

19:34

you have utility world which essentially and

19:36

heresy conservative by nature, no compromise like

19:38

to say that and have very much

19:40

got used to a period all essentially

19:43

zero demand growth for power in the

19:45

Us. so many things a little with

19:47

the demands of people coming to nothing

19:49

really to build always new data centers

19:51

and estate centers com added extra gigawatt

19:53

of load feel grid and not really

19:56

being a shock to people and people

19:58

having to kind of change. Hurt.

20:00

I'm think right different ways just about

20:02

the challenges they face. is that what

20:04

you're seeing as what if you may

20:06

want to be with other part of

20:08

what I talk about in circles like

20:11

this is this idea of said of

20:13

this abusing people of this malthusian approach

20:15

to the world which is that we

20:17

somehow convinced ourselves in the eighties and

20:19

nineties that the way to preserve our

20:21

species or to grow our species was

20:23

actually status that more energy was bad,

20:25

more population was sad, more consumption was

20:28

bad when in fact what we're. Discovering.

20:30

The opposite may be true and in

20:32

fact the opposite on a certain is

20:34

true. That thesis is is in the

20:36

beginning of the end and you start

20:39

to see that in how demographics play

20:41

out all over the world. energy is

20:43

just a proxy to growth, and an

20:45

increase in energy demands should actually signal

20:47

a lot of good things in this

20:49

guy. Selling singles, really exciting things, how

20:51

we produce and energy is the most

20:54

important thing and you know the word

20:56

nuclear is becoming more and more prevalent

20:58

and more more positive. And it's

21:00

pretty clear to most be working at

21:02

this point that the renewal of half

21:04

isn't actually sufficient to meet the demand

21:06

that we need to look beyond our

21:08

current sources of energy. Says actually solve

21:10

these problems and you bridge and fusion.

21:12

Do we actually need workable fusion power

21:14

to kind of unlawful responsibilities necessary to

21:16

make growth and energy demand a good

21:18

thing runs about? I mean, recently nuclear

21:20

To make growth and energy man a

21:22

good thing? not a bad thing. How

21:24

big of a solar field can you

21:26

actually build to serve the next generation

21:28

of Ai models? I. mean you can

21:30

build one the size arizona texas which

21:33

is what am i require how many

21:35

wind farms can you actually build before

21:37

it everybody will die as or whatever

21:39

right i should say whatever that's weapon

21:41

but there are real cost to the

21:43

traditional renewable energies we have the generation

21:45

nuclear reactors today that we know are

21:47

safe and we know our fish him

21:49

as good as they go out to

21:51

build them but it seems like this

21:53

has to details okay but the counter

21:55

argument to latvian is that the current

21:57

generation of nuclear technologies that are available

21:59

have been tried and essentially project by

22:01

the market. So we saw, for instance,

22:03

plans to build new SMRs in Idaho

22:05

last year, getting scrapped, that new scale

22:08

SMR project was abandoned. We've

22:10

had huge cost overruns, delays

22:13

to reactors being built in Europe and

22:15

the US in particular, projects going way

22:17

beyond schedule and so on. And if

22:19

you compare that with actually very low

22:21

costs of wind and solar power right

22:23

now and very low cost of natural

22:25

gas generation as well, it just seems

22:27

like it's really hard to economically make

22:30

the phase more nuclear. So how do you

22:32

get around that? I'm not an energy economist,

22:34

so I'll start by prefacing that. I will

22:36

say the equation seems untenable otherwise. Demand is

22:38

going to outstrip supply by such an incredible

22:41

margin that's simply saying we should build more

22:43

wind and solar energy

22:45

isn't sufficient. Even if

22:47

natural gas is truly abundant, you can only

22:50

put so much onto the grid. And ultimately,

22:52

look, I'm again not an economist, but it

22:54

seems like the solution has to

22:57

be some outside resource. So fusion power then

22:59

does seem to be the thing that sort

23:01

of unlocks all of it. This is where

23:03

I hang my hat. Right. And if you're

23:05

being cynical, then you say this is the

23:07

kind of the Deus Ex Machina, this is

23:09

the magic one, you know, how fusion power

23:11

that'll make everything all right. Sure. But you're

23:13

saying you believe that AI will be the

23:16

crucial tool that will help us get to

23:18

viable fusion power. What do you mean by

23:20

that? It seems almost certain that AI will

23:22

again be a beneficiary of fusion and a

23:24

benefactor of fusion. And so far as the

23:27

experiments that we run today, in general experiments

23:29

that we run in energy are becoming much

23:31

easier, much less expensive because of AI, we're

23:33

just able to do a whole lot more

23:35

testing. And you heard it this

23:37

morning, it's talked about all over the floor,

23:40

the things people are doing to actually understand

23:42

better how to move energy on and off

23:44

the grid. Fusion is no exception to that.

23:46

AGI almost certainly solves a lot

23:48

of technological breakthroughs. One of them is going to

23:50

be fusion. By the same token, fusion almost certainly

23:52

solves AGI because if we can solve fusion and

23:54

we can build a bunch of fusion reactors, well,

23:57

then suddenly we can build a bunch of these

23:59

massive machines. assuming we can get the

24:01

compute, which is a separate issue, and run them

24:03

abundantly. That is very interesting. It does seem to

24:05

be a real harmonization of interest then between people

24:08

who are interested in AI and

24:10

people who are interested in fusion power, a lot

24:12

of overlap there. It's not a coincidence that Sam

24:14

Altman is an investor in both Helion and the

24:16

CEO of OpenAI and sort of has called this

24:18

one of the major problems that we need to

24:20

solve, the energy deficit problem. And the other thing

24:22

I think a lot of people might say is,

24:24

well, this sounds kind of like science fiction to

24:26

us. And that combination in particular of AI plus

24:29

fusion, these are technologies

24:32

that people talk about for some kind

24:34

of far distant future. How

24:36

far away are they really, do you think? I

24:38

mean, is this, you know, we come back in

24:40

Disturbitec 2034, in 10 years time. I

24:44

think there's a fusion reactor in 2034. The

24:46

prevailing sentiment is that it takes six

24:48

years to build a fusion reactor from

24:50

time of discovery. We're probably

24:53

between three and five years out,

24:55

from discovery. I'll take the under.

24:57

I'm generally an optimist. I think

24:59

things move way faster on the large

25:01

time scale than we appreciate. And again, I

25:03

just remind everyone, try to explain the world

25:05

today to someone in 1950. I mean, the

25:07

things that we have discovered and the ways

25:09

we have moved ourselves forward is so remarkable.

25:11

Imagine the scenario in which you will struggle

25:14

to understand the world in 20 years. A

25:16

lot of things will have happened, principally among

25:19

them, I think, abundant energy and AI.

25:21

There is that good Bill Gates quote,

25:23

which someone, as you can probably

25:26

tell, they're intrinsically quite skeptical about a lot

25:28

of this. Well, you're British. So yeah, exactly.

25:32

It's not a country that tends to

25:34

be enthusiastic about embracing the future. But

25:36

Bill Gates Said famously, everyone tends to

25:38

overestimate what they can do in one

25:40

year. underestimate what can be done in

25:42

10. I Do think there is something

25:44

in that. Yeah. I Mean, you're talking

25:46

about a species that figured out how

25:48

to fly a plane and then put

25:50

people on the moon 60 years later.

25:52

We are quite good at things once

25:54

we give ourselves the permission to imagine

25:56

their possibilities. And I Think the public

25:58

perception is, actually. Critical to all

26:01

of this is why I talk about

26:03

we stop building mega projects as a

26:05

species and I think that give us

26:07

an incredible to service the know and

26:09

preferred. The interesting thing about mega projects

26:11

isn't simply that they stand and you

26:13

can remarket them if it reminds us

26:15

all the incredible things were capable and

26:17

these are really important to do to

26:19

remind ourselves how we can progress. And

26:21

thirty four the climate perspective. You could

26:23

say climate change. My view a mega

26:25

challenged exactly and eighty something. This is

26:27

the ultimate mega projects for for right

26:29

now. And given everything that makes

26:32

it so difficult to address with over technologies

26:34

that we have today, it says he would

26:36

make a big difference if we have. My

26:38

name may be the ultimate difference er ist

26:40

and well let's hope we can both be

26:42

back here. In turn your family for yearn

26:45

for the phone for I would love to

26:47

see whether that prediction came true. Eleven cycle

26:49

of junior. Thank you. For. Perspective

26:51

from one of the utilities the will be

26:53

making the practical decisions about how far to

26:56

adopt a I I talked to Quinn not

26:58

a Yamaha, the Senior Director of Grid Research

27:00

Innovation and Development Genome Id at Pg in

27:03

a weekend. For new to this a complex

27:05

homogeneous where things are have. One of the

27:07

big issues that everyone's been talking about here

27:09

at For Protected is a I my cat

27:12

of their to buy this is it seems

27:14

to be both the cause of and the

27:16

solution to all the problems of the gravy

27:19

and I but it's of the creating new.

27:21

Demands on the great lot of

27:23

and you know been granted it's

27:25

not. Also people are talking about

27:27

Ai as being a waiter manage

27:29

the great much more efficiently as

27:31

a deal with the various the

27:33

challenges including the city and do

27:36

authors and co on the they

27:38

renewable on creating whole new set

27:40

of challenges. What's your view on

27:42

I'm in how you thinking about

27:44

Ai at Pg in a what

27:46

do you see as the opportunity?

27:48

that fair amount of a potential

27:50

pitfalls and. way i have and

27:52

ml is a very big most

27:54

where that's going on on an

27:56

interesting i think it also has

27:58

a higher level called automation.

28:00

And so not all of that has to

28:03

be done by AI-ML, there's automation

28:06

that can happen without that. And so

28:08

the broader question needs to be where

28:11

do we need to automate? And I

28:13

think from our perspective is do we

28:15

understand all of the different type of

28:17

use cases that we as a utility

28:19

want to create further and further automation?

28:22

Whether it's through AI, whether it's through ML,

28:24

whether it's generative AI, or just pure nuts

28:26

and bolts automation. Once you figure out

28:29

all of those use cases that you

28:31

could particularly envision, the second question is,

28:33

is this really a technology problem? I

28:35

think too many utilities jump directly into

28:38

AI-ML if it's going to resolve all

28:40

of your related issues. And when you

28:42

peel that back, you might actually find

28:44

that yeah, you can do

28:46

AI-ML for this particular thing, but it's a

28:48

process issue stupid. Right? And it's like, well

28:51

in that case, are we just applying technology

28:53

to solve a higher level issue? Once

28:55

you peel that back, then it's really

28:58

about well, where are we going to

29:00

get the most bang for the buck

29:02

to apply AI-ML to achieve our 10-year

29:04

targets on our strategy or our 30-year

29:06

objectives? And we haven't gone through that

29:08

exercise. What ends up happening is you

29:11

get all these spot AI-ML conversations. If

29:13

we used AI-ML in this area, it

29:15

would be amazing. Or here, here, I think

29:17

we need to take a step back and ask ourselves

29:19

what are going to be the biggest benefits? Now

29:22

I can tell you, generally speaking,

29:24

that certain foundational things need to

29:26

happen before you do more of

29:28

the advanced AI-ML. So I'll give

29:30

you an example. AI-ML can really

29:32

help you with identifying where your

29:34

assets are and cleaning up your

29:36

asset registry. Once you get there,

29:39

then you can start stacking on all

29:41

these other AI-ML related use cases. But

29:43

there are certain situations where you just

29:45

got to get the basics right and

29:47

then be able to go into

29:50

how can AI-ML help you with

29:52

inspections? How can AI-ML help you

29:54

with optimization of dispatches? How can

29:57

AI-ML help you do simple estimations

29:59

with without having to have an

30:01

engineer draw up those

30:04

drawings. There are definitely places

30:06

that we can target, but we're

30:08

going to undertake an effort to

30:10

really understand what is the world

30:12

of the use cases, and then

30:14

create a multi-year view into what

30:16

is going to have the biggest

30:19

bang for the buck. How

30:21

do we think about data? How do we think

30:23

about data security? How do we think about cyber

30:25

security? These are all things that we're going to

30:27

have to tackle. Right, so as you say, when

30:29

you're thinking about security, privacy, some of those

30:31

issues, that's really where you start

30:33

to get into a discussion about the pitfalls and

30:36

the risks in AI. What

30:39

do you see those as being? I mean, is there a

30:42

danger in creating a system?

30:44

I mean, as you say, you think about

30:46

automation at large, a system

30:48

that kind of escapes from human control.

30:50

I'm not so concerned about a system

30:53

that escapes from human control because I

30:55

think that we're going to step into

30:57

the AI and ML in a very

30:59

methodical way. I'll

31:01

give you one example where AI and ML could

31:03

be very detrimental to a particular

31:06

utility's business, and let's take a look

31:08

at it through the inspection process. Right

31:11

now, utilities have the ability due

31:13

to the cost of photos becoming

31:15

significantly cheaper and visualization becoming significantly

31:18

cheaper that you can get imagery

31:20

of all of your assets almost

31:22

all the time. Now, AI

31:25

and ML done incorrectly could create a

31:27

whole bunch of false positives that

31:29

you now need to go track down. If

31:32

you don't do this in a

31:34

very careful way, you can't unsee

31:36

some sort of degradation on the

31:38

system. However, if it's wrongfully prioritized,

31:40

you put yourself at significant risk,

31:43

both from a cost perspective and a

31:45

liability perspective. So really, how do you

31:47

make sure that you're training it, retraining

31:49

it, getting the right results before

31:51

you start to really roll it out across

31:54

the system? And this is where, I think

31:56

one of the biggest things that utilities struggle

31:58

with is this fast pilot, fast. fail,

32:01

right, mentality, where you take

32:03

particular use cases, you do

32:05

a quick hyper agile development

32:07

on that, you test that out and if it doesn't

32:09

work, you move on to the next thing. Sometimes

32:12

what we do is we tend to get too

32:14

invested in our ideas, that we have a hard

32:16

time letting go and we just pump money into

32:18

a failed idea. And I think with this AI

32:20

ML, it's going to be a lot of that.

32:23

We're going to try things. Something's going to work,

32:25

something's not going to work. And as you kind

32:27

of take a step approach, really

32:29

try to make it so that

32:31

the outputs that you're getting are

32:33

having the material benefit that you

32:35

want for your 10 year strategy

32:38

is going to be key. Now, is

32:40

there a world where AI ML

32:42

will take over what the utilities are going

32:45

to do? I mean, who

32:47

knows what the 30 year future is going

32:49

to look like at the current time? I

32:51

can't see it. Anything's possible with

32:53

this technology. Skynet may take over the

32:56

world. I mean, there are endless possibilities

32:58

of where this can go. I

33:00

think what we're going to do is

33:03

we're going to walk into this very

33:05

deliberately, push the realms of what we

33:07

can do, but always keep in mind

33:09

the safety of our customers, the safety

33:11

of our grid. That is always going

33:13

to be at the forefront of what we do. And

33:15

if we do that, then I believe that we can

33:17

create an AI ML vision and a

33:19

world that's really going to benefit our customers. Quinn

33:21

Nakayama, thanks very much for joining us on the

33:23

energy game. I appreciate it, thank you. For more

33:25

of my conversation with Quinn Nakayama, where we talked

33:28

about the new challenges for the grid created by

33:30

electric vehicles, look out for a special edition of

33:32

the energy gang coming soon. Now,

33:34

Quinn made the good point that AI applications

33:36

are only a subset really of the wider

33:39

range of technologies for automation and digitalization of

33:41

the electricity system. To discuss

33:43

those, I talked to Tom Dietrich, who's chief

33:45

executive of Itron, which is wise technologies for

33:47

utilities and cities to manage energy, water, and

33:50

traffic. And I talked to him about the

33:52

adoption of those technologies and what might be

33:54

holding them back. Tom, good to see

33:56

you again. Ed, great to be back with you. Absolutely, yeah, great

33:58

to have you back on the show. So, interested

34:01

first of all perhaps in what

34:03

you're hearing while you've been here,

34:05

as you're kind of walking around

34:07

meeting people, meeting other people in

34:09

the industry, meeting customers I'm sure

34:11

as well, and the

34:13

conversations you're having here, what are people

34:15

talking about? What struck you

34:17

as interesting? So, there are two mega trends

34:19

that I think are really interesting to point

34:21

out. One on the customer side, one on

34:24

the technology side. I'll start with the customer

34:26

part first. Consumers are

34:28

really, really struggling to keep up

34:30

with the pace of technology that's coming

34:32

out them. There's so many different

34:34

ways to attack a problem. There's so many

34:36

problems that they have that are unsolved yet

34:39

today, but technology is coming at them much

34:41

faster than they can absorb it. And the

34:43

corollary to that, and then the second part

34:45

of my answer, is on the technology side,

34:48

that technology companies like I-Tron have realized

34:50

that, oh, this is a real problem.

34:52

It's a problem for the customer because

34:54

they aren't solving the problem for their

34:57

consumers, you and I, but it's also

34:59

slowing down our business growth potential. So

35:01

what are we doing in response to that?

35:04

It is spending more time collaborating among

35:06

ourselves. Let's reintegrate a solution. Let's have

35:09

two companies that work side by side

35:12

inside of the utility to supply some solutions to

35:14

them, but let's do that before we get to

35:16

them. So we present a united front by the

35:18

time we get to the customer, the utility in

35:21

this particular case. One of the

35:23

big examples of that is we've had some

35:25

announcements running up to this event where we

35:27

were going to preintegrate our solution for grid

35:29

edge intelligence with Schneider Electric,

35:31

who does ADMS, or

35:34

with GE Vernova, who does a similar

35:36

ADMS kind of solution. But if we

35:38

can't combine... Sorry, ADMS. Sorry, too many

35:40

acronyms, but Advanced Distribution Management System. So

35:44

I-Tron works close to your dwelling, close

35:46

to the home, higher up in the

35:48

transmission line and in the stack, higher

35:50

voltages where these other companies work. If

35:52

we can come and show up with

35:54

the solution together, it helps the customer

35:56

deal with this problem that they have

35:58

to provide good and reliable service. but

36:00

also deal with the pace of technological change. That's

36:03

very interesting, yeah. So going back to the first

36:05

point you were making, as you say, about the

36:07

two big trends, that's something I've also been really

36:09

struck by, and it's one of these kind of

36:12

terrible cliches that people come up with about, oh,

36:14

there's so much change and things, you know, we

36:16

live at a revolutionary time, et cetera. But actually,

36:19

in this industry, the utilities in particular, who

36:21

are crucially your customer base, it does really

36:23

seem to be true. There is something that's

36:25

very different about the world we live in

36:27

and the number of things I think of

36:29

are, I suppose, two crucial ones. One

36:31

is that we're on the demand side, is

36:34

that after a long period of essentially

36:36

static demand in the United States for

36:38

power, suddenly that's really kind of taken

36:40

off. Various trends going on here, data

36:43

centers for AI being one big one,

36:45

the revival of manufacturing industry, new plants

36:47

bringing up, particularly chip plants coming has

36:50

been a big thing, but also obviously

36:52

demands for literally heating, electric vehicles becoming

36:54

very significant. And then on the supply

36:56

side, obviously the well-known challenges of managing

36:59

variable renewables on the grid, which must

37:01

be a completely different environment for utility.

37:03

Is that how you're saying it was?

37:05

Absolutely, I identify with everything that you

37:07

said there. I had a customer event

37:09

yesterday, so picture this, a room with

37:11

about 100 to 125 customers inside

37:16

of it, and they were just talking among

37:18

themselves. And one customer said, I see my

37:20

demand doubling or perhaps tripling over the next

37:22

10 years. So all we have to do

37:25

on the generation side is build what we

37:27

built over the last 100 years in

37:29

the next Decade. Oh, that doesn't sound hard

37:31

at all.. And What was driving that

37:34

demand increase was exactly the things you

37:36

were talking about. It is manufacturing, it

37:38

is AI driven data centers, and it

37:40

is electric vehicles, which are wildly different

37:43

loads, especially EVs, than what the utility

37:45

is used to dealing with. And So

37:47

in terms of tackling those challenges, what

37:50

can technology do to help? And what

37:52

are the crucial innovations? And As you

37:54

say. So there's one particular thing you've

37:56

just been talking about in terms of

37:59

suppliers getting together. The form an alliance

38:01

isn't partnership to provide and a package

38:03

solutions utilities but one of the things

38:05

that really have make a difference and

38:07

will help them deal with they've as

38:09

like what is genuine. The I think

38:11

of a new well here I will

38:13

focus my answer on the distribution. Great

38:15

many that the stuff that's close to

38:17

where you and I were called to

38:19

our house and I think all of

38:21

these two seperate energy resources. electric vehicles,

38:23

rooftop solar, batteries behind meter. All of

38:25

those resources themselves are starting to pop

38:27

up in uncontrolled way from the utility

38:29

for stalking. Her first and foremost

38:32

honey provide visibility to the utility Were

38:34

those things are that is truly truly

38:36

helpful for the Italy Fab. I know

38:38

where they are that I can reach

38:40

out to that customers. Hey, would you

38:42

like to enroll in my program to

38:44

control charge and secondarily as understand what

38:46

capabilities you have a utility to deal

38:48

with That Hey will that person allow

38:50

me to control when their vehicle is

38:52

charged? Be able to control it turning

38:55

on and off when you need our

38:57

on the grid. and finally optimize, Please

38:59

Charge This car. When the sun is

39:01

shining on that roof. So this for

39:03

progression of visibility capability control is it

39:05

has. And the fact

39:08

that utilities don't have that have a

39:10

moment I think is often spoken to

39:12

people when they think about it need

39:14

to come from another in disarray. and

39:16

if the girls were you in the

39:18

business is serving the consumer the amount

39:20

virtues of it is just don't know

39:22

about what mechanism doing And from the

39:24

dimona she'd been increasing think of a

39:26

distributed energy supplying power back to the

39:28

great of well it may they. Agreed

39:30

was designed as a one way push

39:32

it was always assumed would just push

39:34

our down and will be there and

39:36

suddenly the world changes. Aware that isn't

39:38

relief economically possible a feasible and now

39:40

how do you deal with that from

39:42

a consumer standpoint is shocking and services

39:44

that was when you for cure another

39:46

service in your life. As a consumer

39:48

you ordered blueberries for delivery as an

39:50

example you new in real time when

39:52

a driver was leaving the restaurant and

39:54

his or her name and how much

39:56

it was gonna cost and when they

39:58

were showing up on. your flat. The

40:00

last time you dealt with your power company may

40:02

have been lights are off and you're ringing them

40:04

up saying, when are my lights coming back on?

40:06

And they may not have even known the lights

40:08

are out. That service imbalance is a huge

40:11

barrier for the utilities to overcome and something

40:13

that I think technology like Edge Intelligence that

40:15

I talked about can really help. So it's

40:18

not really a surprise that these changes are

40:20

coming, right? I mean, people have seen this

40:22

at least kind of 20 years in the

40:24

past, 30 years in the past. People could

40:27

tell that this was the way the grid

40:29

was likely to evolve and people had that

40:31

sense that the grid of 100

40:33

years ago was not going to be fit for

40:36

purpose in the 21st century. How

40:38

rapid has progress been towards adopting

40:41

these new technologies? It feels to me like

40:43

actually the industry has been often much slower

40:45

than it should have been and

40:48

now things which have been seen sort

40:50

of as looming future possibilities heavy towards

40:52

us are now actually very real and

40:54

are really affecting people and

40:56

the industry is just not really prepared in time.

40:58

Is that fair with that? I think

41:01

that's sadly extremely fair. I think

41:03

grid modernization now needs to happen

41:05

in years, not decades. And we're

41:07

starting from a disadvantaged position. We

41:09

are behind. There's lots of reasons,

41:12

the regulatory models that are at

41:14

play, how traditional buying patterns have

41:16

worked. Utilities are used to buying

41:18

things and putting them in

41:20

the field and depreciating them over 10 or

41:22

20 years. But if you don't know what

41:24

happens next month, let alone five years from

41:27

now, how do you plan for that? So

41:29

there's many things that need to change about

41:31

the buying model, the regulatory model and really

41:33

the technology itself to be able to help

41:35

solve problems. And what more could be done

41:38

to help expedite this change and to get

41:40

these new technologies deployed across the US industry?

41:42

Is this something the policy needs to help with

41:44

more? Is it something that needs to change

41:46

in the system of regulation? What can

41:49

really be done to sort of accelerate this? And as

41:51

you say, to get this change accomplished in years, which

41:53

is what we need to do. My

41:55

off-the-cup reaction is can I choose all of the

41:58

above as the answer? I think that there Our

42:00

policy changes, so governments can help

42:02

drive policy in a way that makes

42:04

it easier for utilities and for

42:06

technology companies to move faster and drive

42:09

better solutions to one. I

42:11

think regulatory policy can be adapted

42:13

to make it easier to deploy

42:16

new technologies. Today, it is very

42:18

difficult to deploy fast solution software

42:20

as a service-based solution because it

42:23

doesn't cleanly fit into the model

42:25

most utilities have. A

42:27

change in the regulatory structure to

42:30

allow capitalization of software as a

42:32

service as an example is something that's

42:34

possible that would also be helpful

42:36

to move the technology forward itself.

42:39

And then on the provider side, I think

42:41

we have to continue to push the envelope

42:43

and do a lot of pre-integration to make

42:45

it easier for our technologies to be consumed.

42:48

And as you meet people, walk the corridors

42:50

here, listen to the conversations that are

42:52

going on, has it left you more

42:54

optimistic that the progress is going to be made

42:56

to update the grid the way we're going to

42:58

need to? I would say that I'm certainly more

43:00

optimistic than I was 48 hours ago when

43:03

I set foot on the ground, not because

43:05

we've got the answer in hand today, but

43:07

I see a lot of like-mind thinking and

43:09

talking about the same things, and that really

43:11

is step one to solving the problem. Tom

43:14

Duchik, thank you very much indeed. Thanks for talking to us

43:16

about that today. Yeah, I appreciate your time. Thanks for having

43:19

me. And lastly, I talked to Anthony Allar, who's the head

43:21

of Hitachi Energy in North America. Hitachi

43:23

is an important supply of transmission equipment.

43:26

He was a pioneer of high-voltage direct current

43:28

transmission lines all the way back in 1954. Distributec

43:32

is a great opportunity for him to meet

43:34

customers that use Hitachi's technology. I'll

43:36

ask him what he'd been talking to them about. Thanks

43:39

very much for joining us on the Energy Gang. Nice to meet you. Good

43:41

to be here. So I wanted to

43:43

start off talking a bit about Distributec

43:45

and your presence here. So Hitachi Energy

43:47

is a very important company in the

43:49

transmission industry. You were the pioneers of

43:52

HVDC, high-voltage direct current transmission

43:54

lines. That's I think

43:56

70 years old this year, right? 1954,

43:59

the first one. Phil and Co.

44:01

This is supposedly the leading event

44:03

or admission and of commission and

44:05

I like to have in North

44:07

America. Whoa! A hobby! A great

44:09

opportunity for them to get together

44:11

for have the hands of com

44:13

Haitian, what are you really want

44:15

to talk to people about While

44:17

you'll have what is coming into

44:20

focus on the conversations you're having

44:22

at the city has to be

44:24

questioned assuming se han hi to

44:26

them on if you are think

44:28

harrys like com number of. Composition.

44:30

Of we love in swimming year with customers

44:32

I said it know couple of feel lonely

44:35

is still very high for good reason than

44:37

that in the mind of a catharsis of

44:39

later know. I know now

44:41

for a number of years with him

44:43

behind or equipment going up with inflation

44:46

in fact know how the height of

44:48

the point or solution so those conversational

44:50

still need it because he correctly with

44:52

seen that those challenges warring parties hurt

44:55

and part of the technology provider like

44:57

us on our hundred ethical audible order

44:59

equipment for another the second way Korea

45:01

where you're coming into it's important for

45:04

us to really share what we see

45:06

globally with with you North America with

45:08

our customers so that they can then.

45:11

Into today and get ready at did

45:13

ahead of the curve for that won't

45:15

have another topic is William Digital Solutions

45:18

which is going to be that as

45:20

being loaded more on the diesel hide

45:22

and remains or as in Haiti oh

45:25

good Rhythm of Little High Horse also

45:27

is that important topic or we know

45:29

that the great Today needs to be

45:31

more flexible and more resilient to be

45:34

able to accommodate more renewable energy. So

45:36

Digital is is an enabler whole of

45:38

the national so far as. A. T

45:41

topic that we have a look

45:43

at the dogs would be to have

45:45

been room for the center or consider

45:47

her my ankle. Much of the want

45:50

to take those in term and thinking

45:52

about supply chain challenges for so you're

45:54

saying the thing hard getting were film

45:57

and supply chains. Delays are getting

45:59

longer. It feels like this is

46:01

something that people have been talking about really

46:03

since the pandemic ended and since investment activities

46:05

started to pick up. And you might have

46:07

hoped perhaps that some of the issues with

46:09

the supply chain would have started to get

46:11

fixed by now. But no? Yes

46:14

and no. So the yes is there's hope.

46:17

So I would say the first type

46:19

of equipment which has been impacted by lead

46:21

time and if you ask around, what will

46:23

come to the mind will be transformed. Here

46:27

now fast forward now to three years.

46:30

Now what we see is we've seen a

46:32

number of announcements in terms of investment in

46:34

addition capacity. We have ourselves made a couple

46:36

of investments here in North America. So

46:38

here that additional capacity, some is already

46:40

online, some of ours is already online,

46:43

some of the industry is already online,

46:45

some is not. So I think the

46:47

market sees that we're making progress but

46:49

still the demand is much higher

46:51

than the supply chain. So we see improvement but we

46:53

still see a lot of it clearly. And just particularly

46:55

on that issue of transformers, there's been a lot of

46:58

discussion about that. Obviously people have become very kind of

47:00

fixated on the question of bottlenecks and the

47:02

transform supply chain. But there then it sounds

47:04

like you've got a reasonably positive hopeful message

47:06

for people. You think that as you say

47:08

that new capacity is getting built, we

47:11

are going to see those bottlenecks start to ease. I

47:13

wouldn't go that far. I think

47:15

we see capacity coming in. But still

47:17

the new capacity is still below the

47:19

demand. So we still expect to

47:22

see a lead time at a much higher

47:24

level compared to what they were, for example,

47:26

for your So

47:38

that's the, for the yes, it's getting better. The

47:40

no, it's not getting better. It's now what we

47:42

see is other type of equipment where now we

47:44

see the lead time increasing. And here this is

47:46

where we have a lot of conversation with the

47:48

customers about that to make sure that they understand

47:50

so that we can work with them on the

47:52

planning of the- And What

47:54

types of equipment then are affected by that? For Example,

47:56

circuit breaker is one of them. And Again, are we

47:59

going to ultimately see, They would recommend a

48:01

capacity and I would assume we'll see

48:03

the same dynamic and it also affects

48:05

time similarly that I can. It's a

48:07

com Yes, because Stages of Last Resort.

48:09

Like are you okay You want to

48:11

build a new one or two on

48:13

earth for the capacity you need to

48:15

find. People are getting too old to

48:17

find the the machine as he needs

48:19

or another machine. Or

48:23

harm or like soy turkey and

48:25

a couple that you are the

48:28

core subjects. Withdraw my girl to

48:30

pick up on the other big

48:32

topic you've had her parents talking

48:34

about the you're talking about a

48:36

button digitalization. It has become clear

48:38

up to convey hope that I've

48:40

had conversations with and how they

48:43

offer here van and is a

48:45

enormous interesting location as part of

48:47

the solution to this huge you

48:49

set of challenges that he is

48:51

anything with how effect that. Is

48:53

probably the only for broken

48:55

were bought coping with increased

48:57

proportion of February or with

48:59

on the grid a grief

49:01

distributed energy resources you kinds

49:03

of demands you load particularly

49:05

in North America from the

49:07

present Israel I need Manhattan

49:09

and a his info on

49:11

how little pressures hitting the

49:13

industry thing. When you

49:15

talk about visualization of thing the thing

49:18

that people are looking at what does

49:20

that mean physically and have the know

49:22

what they've chosen as big as a

49:24

question is what robin what you're trying

49:26

to solve with digital who's and I

49:28

thought into a couple of problem though

49:30

was it industry trying to solve one

49:32

of them his residency or we also

49:34

see any crazy know extreme weather events

49:36

are so how do you for so

49:38

hostile how did you into people how

49:40

did you bring more flexibly you agreed

49:42

to be moral of this is the

49:44

type of solution. of problem than

49:47

for solution in the were little connected

49:49

products and in software come in to

49:51

try to provide a solution then when

49:53

you talk about renewable integration right how

49:55

do you make sure that in real

49:58

time you able to keep your supply-demand

50:00

balance on your grade when you know that

50:02

the sun and the wind change so far.

50:04

So that's another problem that can find a

50:06

solution to a digital solution. And the lead

50:09

goes on and on and on, those are

50:11

kind of two examples of where a digital

50:13

solution can support those problems. Right, and though

50:15

beyond that, it does seem very clear that

50:17

there are some problems for which digitalization and

50:20

the kind of technologies we've just been talking about are not

50:22

a complete solution. And I think no

50:24

one would deny that when you go around here,

50:26

there's a lot of people here at S U

50:39

B Tech with various kinds of technology and

50:41

digital solutions that they are offering for different

50:43

aspects of the power grid. That's

50:48

presumably, from the degree with providing that

50:50

physical infrastructure is very much the business

50:52

that the searchy energy is in. physical

50:56

infrastructure. certainly

50:59

true in Europe, it's true very definitely

51:01

in the UK. It's just very, very

51:03

difficult to get more team-commissioned lines put

51:05

in. Why

51:09

is it? That's a difficult question. I think there are a couple

51:11

of things. infrastructure is not as a

51:13

business anymore. It's a very difficult one. It's a very difficult one.

51:16

It's not a very difficult one. It's a very

51:18

difficult one. It's a very difficult one. It's not a

51:20

very difficult one. It's a very difficult one. It's a

51:22

very difficult one. I think there are a couple of

51:24

things. I think the first one that we don't see

51:26

in the United States is a national transmission planning mechanism

51:29

compared to what maybe we see in other parts of

51:31

the world. This is something that there's

51:33

a lot of talk about it, and we certainly

51:35

believe that it is the right thing to do.

51:38

Here, we hope that we will move

51:40

into this direction. It's

51:42

number one. Another challenge is around permitting. Here

51:45

also, this administration has been trying

51:47

to address that topic, and we all know it's a complex

51:49

topic. Again,

51:52

we commend what they've done so far, and

51:54

we really hope that collectively we can find

51:56

a solution to this. the

52:00

speed out which we also need to deploy. Assuming that

52:02

we have all the permitting in the world, all the

52:04

planning in the world done, then you still need to

52:06

execute on those projects. And I think here, if you

52:08

think about it, there's a number of statistics that say

52:10

we need to double, triple the grade. But let's assume

52:12

that, let's just take up the argument, we need to

52:14

double the grade in the next 15, 20

52:17

years. It has taken us almost

52:19

more than 100 years, right? The grade was first

52:21

created in the other part of the world

52:24

at the end of the 19th century. So

52:26

here, now we're talking about rebuilding the same

52:28

grade in the next 15, 20 years or so. So

52:32

we need to think differently. The technology is here,

52:35

so we have the chance to have the technology, but

52:37

we just need to think about it differently.

52:39

We cannot refuse the same scheme and assume

52:41

that we can go at a much faster

52:44

pace. So here, we really need to think

52:46

about new business models. As an

52:48

industry, it's not only one or two stakeholders,

52:50

the entire industry, the utilities, the technology suppliers,

52:52

the government. All the stakeholders need to come

52:55

around the table and find different ways, right?

52:57

And we see different ways in all parts

52:59

of the world, right? We see in Europe,

53:01

for example, a different type of business model

53:04

where some utilities have decided to find long-term

53:07

frame agreements with companies, for example,

53:09

like us, from technology. The positive

53:11

result of this is that that gives them

53:13

security of supply for the next 10 years

53:15

or so. And for us,

53:18

that allows us to know that we

53:20

have a security of demand and in

53:22

return allows us to accelerate our investment,

53:24

right? So I think this is an

53:26

example of new type of business model

53:29

that I think we need to look at more closely

53:31

in North America. And yes, the regulatory construct is a

53:33

little bit different in this part of the world. So

53:36

we cannot do a cut in terms of what we

53:38

see in our part of the world, but we need

53:40

to look at it and try to see what are

53:42

we learning from that one example I get from Europe

53:44

and how could we tweak that to apply it to

53:46

the US in a way that works with the US

53:48

regulatory construct. That is really interesting.

53:50

How optimistic are you that that kind of

53:52

new thinking in business models can be made

53:54

to think? I mean, just because

53:57

the reason I raise that

53:59

question The details like that is

54:01

a very conservative industry. The in Sleep

54:03

doesn't change much as essentially you're talking

54:05

about the physical infrastructure being the same

54:07

as it was in the late nineteenth

54:09

century. As you the business model is

54:11

also oversight. Music was in the late

54:13

nineteenth century. have not a whole months

54:15

and for good reason. People are risk

54:17

of her and competitive and they want

54:19

to shake things up in ways that

54:21

might lead to the light's going. All

54:23

so how could you persuade people who

54:25

have a duty to think differently? Your

54:27

question I am fairly optimistic for to.

54:30

Or think number one this country has demonstrated

54:32

than when there is a problem there was

54:34

a solution and at some points all the

54:36

stakeholders get together and really of find a

54:39

solution but also we'll adding very different proposition

54:41

today with our customers over to the courses

54:43

and we I'm in four years ago I'd

54:45

and us really a command or customers year

54:48

in terms of acknowledging that we need for

54:50

a qb to or differences and the said

54:52

that we are collected in making flooding here

54:54

Adidas very encouraging it was still have a

54:57

new ways to go but I'm looking his

54:59

signature will. Give their say think becomes

55:01

a distributed again in five years' time.

55:03

Authentic distributor Twenty Twenty Nine You think

55:05

things are going to seem pretty different

55:07

than I would hope that. I will

55:09

hope that we will see new business

55:11

model that we see a regulation which

55:13

has evolved and enable a faster investments

55:16

and I'm sure so we will see

55:18

a lot of a Ai solution on

55:20

the floor like we already saw to

55:22

see this year. but I'm sure in

55:24

five years from now there will be

55:26

a not a a buzzword there would

55:28

be around just a fact. That set

55:30

back when to think about the

55:32

broader context of this, it's now

55:35

one of those cliches. the past

55:37

five years ago Randall of People

55:39

Face know transition without transmission in

55:41

that building you need capacity is

55:43

absolutely essential to shifting the electricity

55:45

system over to low carbon technologies

55:48

renewables another kind. So this is

55:50

something of last. If we're serious

55:52

about addressing climate change, we really

55:54

do have to make absolutely yeah,

55:56

there was no transition with transmission.

55:58

I fully agree. and I think

56:01

now what's very encouraging is again going

56:03

back in time three years ago people

56:06

in the industry knew about it But

56:08

today this is public knowledge This is

56:10

something that you see in major newspapers

56:12

and that really the proof that now

56:14

it's really a Fight that

56:17

is well accepted and understood, but now we need to

56:19

get to work and see the yellow. Thanks for much.

56:21

Enjoy. Thank you So that's it for

56:23

us on the first full day of distributed Fascinating

56:26

to talk to all these people about the

56:29

problems they're facing the solutions They're advancing

56:32

when you stand back and think about the energy

56:34

transition at the highest level I think it's very

56:36

easy for the debate to get pretty abstract But

56:38

what we have at this event is thousands of

56:41

people who are working on the challenge of decarbonizing

56:43

the energy system And they're creating

56:45

real change in the shape of metal

56:47

and concrete and software such a really

56:49

inspiring thing to see I think many

56:52

thanks to all of our guests have been talking to

56:54

us about what they're doing Many thanks to our producers

56:56

Dan Cottrell Toby Biggins Gilchrist and Sam Nash and

56:59

above all of course many Thanks to all of

57:01

you for listening Please do keep your feedback coming

57:03

look out for the rest of my conversation with

57:05

Quinn Nakayama of PG&E You won't

57:07

want to miss that. I think it is really

57:09

a fascinating discussion And we'll

57:11

be back soon with all the latest news and

57:13

views on the energy transition until

57:16

then. Goodbye