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THE FRONTIER LINE
Hosts Wayne Aston and David Murray explore the critical global pillars of infrastructure development and energy production, from traditional methods to future-forward advancements. The Frontier Line covers the latest industry news, energy innovations, and sustainability trends that are shaping the future. Through expert interviews with industry leaders in renewable energy, utility-scale battery storage, and waste-to-energy technologies, the podcast provides insights into the evolving landscape of energy efficiency and sustainable infrastructure. By focusing on the intersection of innovation and the politics of energy, The Frontier Line highlights transformative ideas and technologies poised to deliver cost-efficient, resilient, and sustainable solutions for global industries.
THE FRONTIER LINE
Schneider Electric Acquires Motivair Advanced Liquid Cooling, Google Goes Nuclear, Rikki Hrenko Browning- Utah Petroleum Association in the News, October 2024 Headlines
Discover the future of data center cooling and energy solutions with our latest episode. Learn how Schneider Electric's $850 million acquisition of Motive Air is reshaping the industry with cutting-edge liquid cooling and advanced thermal management, addressing the environmental and energy challenges of high-performance computing. Get insights into how this move could redefine data center locations and power production while minimizing water consumption. Our discussion offers a glimpse into a future where energy efficiency meets environmental responsibility.
Next, we explore the fascinating world of small nuclear reactors with breakthroughs led by innovators like Kairos Power. These micro reactors, using advanced molten salt cooling, are setting the stage for localized, low-impact power solutions. With tech giants like Google showing interest, the potential for micro reactors to transform smart microgrids and offer sustainable power in remote locations is promising. We examine how these developments might play a crucial role in the sustainable expansion of our energy grid, combining zero-emissions benefits with enhanced safety and environmental considerations.
Finally, we tackle the complexities of renewable energy adoption and the balance required to meet future demands sustainably. From the debates over wind and solar farm restrictions in Alberta to the challenges faced by California's power grid, we discuss the importance of aligning diverse stakeholders and maintaining a diversified energy strategy. Insights from experts like Andy Svengros of JLL illuminate the intricate balance communities must maintain, while the Arizona Corporation Commission election highlights the delicate dance of policy, practicality, and power. Join us as we navigate these critical conversations and consider the global energy race's resource challenges.
And we're back. We're back. Good morning, welcome, good afternoon, whenever you're listening to this, to the Frontier Line Happy to be here.
Speaker 2:Good to be here, Wayne. How are you?
Speaker 1:feeling, dave, feeling great, feeling great. As always. Not much going on in the world of AI or infrastructure or the grid, nothing really going on Right. Right, which obviously couldn't be further from the truth. Yeah, so today we're going to do some headlines. We're going to talk about what's going on in the world that we're seeing here in the frontiers of infrastructure.
Speaker 2:Yeah, I've got a couple, and I want you to kick it off because we were comparing notes here. I've got some big headlines, but I I think you've got some great ones too, and particularly this first one. I think it's a perfect lead-in absolutely a group.
Speaker 1:We're a big fan of absolutely that. Uh, we you know, we've talked to and we think they they're doing amazing work. Uh. Schneider electric uh announced today to buy data center cooling firm motive air. Uh an 850 million dollar deal, uh. So they said today, uh which, uh, whenever you're listening to this, you'll um agree to acquire a controlling interest in buffalo based motive air for 850 million in cash. The deal will give schneider a 75 stake of 75 in the company, which specializes in liquid cooling and advanced thermal management solutions for high-performance computing systems, with plans to buy the rest by 2028. Wow, wow, wow wow, Congratulations Schneider.
Speaker 2:What a huge move in the market. A huge move in the market $850 million cash.
Speaker 1:Yes, so we'll round up. They're not kidding. They're throwing nearly a billion dollars into what I believe they think is the future. Yeah absolutely and certainly securing their stake in being a kind of all-in-one solutions company for where this is all going, and building out these microgrids and power solutions and such and obviously data centers and how do you solve that whole ecosystem, that whole chain, and investing in all the parts. So it's a big move, big, big move.
Speaker 2:Yeah, that's awesome, that's really awesome.
Speaker 1:Very good to see, very, very good to see.
Speaker 2:And we've been talking about. You know, when we talked about the Tier 5, specifically Tier 5 category of data centers, schneider is on the forefront of our consultancy team to help design some of the advanced HVAC and cooling mechanisms that are going to have to be present within the white space of a tier five next gen data center. And among those things, we've been talking about liquid immersion cooling. We were talking about data centers that you know because, well, let me back up for just a second.
Speaker 2:Let's talk about cooling and water for just a second why this is so relevant. This is so relevant, Dave, when you brought to the table for our listeners and myself the four tiers, the four current categories of data centers. We talked about a lot of things, nomenclature being one of them, air cooling. We've studied how traditional Gen 1 data centers have traditionally kept things cool. Now, with this expanded compute power, we talked about Elon Musk and linking 100,000 NVIDIA chips all together in like 19 days, breaking all the molds. That type of compute power generates an exorbitant amount of heat, guys, and I think anyone listening probably already understands that intuitively.
Speaker 1:Well, if you've been in the crypto space for any period of time, this has been a talk for a long, long time. It's been one of the knocks, if you will, against maybe the Bitcoin mining and such. It was the amount of power, but early on we're talking early generation they were dealing with a lot of heat, and so it's been something that's been out there and I think it's pushed a lot of this innovation to say how do we do this better?
Speaker 2:Well, you know, in one of our recent episodes we interviewed our chief investment officer, Ryan Miller, and we touched on some more impediments. And whenever we go into some new market and we're talking to municipal authorities and we talk about water, it almost doesn't matter where you're at. Water is a sensitive subject it is, and so when you present a plan to anyone who is not fully aware of the tech that's being deployed today, it's easy to make assumptions about water consumption. It's easy to assume if you need that much compute power and you're going to use that much energy three, 500 megawatts, a gigawatt, more than a gigawatt you draw these conclusions like that must take billions of gallons to cool that and, traditionally speaking, that would be the case, and even we talked about a thing up where they compared the water usage between different data centers and so, up in, say, washington State highly inefficient in comparison to, say, texas and their use of water.
Speaker 1:But nonetheless, I think, if I'm let me see, I'll go back in the Wayback Machine. I think it was for every if you wanted to compose an email using chat using a data center in Washington. It was something basically like a liter of water or something like that. It was an exorbitant amount of water for one action. That's right, it was like a fifth of that in Texas, but nonetheless that goes to your point. This is an issue for a reason.
Speaker 2:So it's exciting to bring to everyone's attention the fact that, and to underscore this move that Schneider's making here by buying this cooling technology and this company, is we're moving into the next gen of data centers, where we're actually using terms like waterless. We're talking about alternative liquid cooling in closed-loop systems that do not consume water. That's right. That is a game-changer in my mind, because now you can broaden the geographical range of where you might locate one of those. Yes, you have constraints of power. That's the primary and that's going to be.
Speaker 2:That's why we're so heavily advocating and designing for on-site power production, but if you can solve cooling without water, that checks a massive box and I'm eager to pay attention to this move and track track it. Maybe we can get some intel from the guys we're working with at schneider to kind of give us some some behind the scenes insights on what. What exactly they're seeing, you know, in the water immersion, uh, or, excuse me, liquid immersion. Let's not, let's not. Yes, uh, mince, mince, the, the wrong terms, right? Well, liquid immersion. I was reading about this liquid technology, just stating that water's not clean enough. Basically, you've got these engineered fluids. Glycol is one of them, but there are many of them that are much cleaner. They're like surgically clean. You know electrostatic water, right? Or electrostatic fluids, engineered fluids that we're talking about here.
Speaker 1:so this is, this is, this is space age stuff guys it is, and I mean I'll just throw I'll finish with one of the nuggets that they throw at the end of this and just to underscore this Market space okay uh, the company said the data center Network's Market accounted for 21 of of its 2023 orders, or about about a billion Euro worth of sales, and is seeing double digit growth this year.
Speaker 1:So they're they're obviously seeing all the same things. We are obviously, and they're saying how do we, how do we, how do we get into this, how do we, how do we add parts to our business that are complementary and can give us uh, give us efficiency of scale? So, love that, it's fantastic, it's good to see. Yeah, congrats schneider. Yeah, that's a motive, that's a huge one. Yeah to both of them and it's a big deal for motive here.
Speaker 2:Yeah to, to get the type of valuation and and make the move in the market. Yep, okay, well, uh, I'll segue, I'll segue, uh, we'll, we'll just keep talking about these data centers. Headline first hedge. Headline I'm going to bring us from fortune magazine, fortunecom. Uh, google will help build seven nuclear reactors to power its AI systems. Okay, I love that.
Speaker 1:I saw that. Yes, it's something. It's impressive.
Speaker 2:So you know, the publisher, or the person who wrote the article, did a great job of explaining that this is not the huge smokestack nuclear reactors of old that we've all come akin to know. You know the Three Mile Island type reactors. What they're talking about is these micro reactors, which is all the buzz in the nuclear sector right now. We're talking about very small nuclear reactors using advanced molten salt cooling technologies. Reactors using advanced molten salt cooling technologies. According to this article, this seems light and to be verified here with time, but you know seven nuclear reactors from one builder they identify the builder here and the total sum of that is 500 megawatts. So to me that that seems super low, but but it would make sense if you're talking about a reactor that's so small, yeah it could be sited on site and maybe it's, you know, maybe it's pushing 20 megawatts.
Speaker 2:Yeah, in a very, you know, very focused, you know, smaller application, you get seven of those or you do a hundred of those. The seven's a test case with this new builder, uh, apparently this, this nuclear reactor company that's building them uh, kairos power uh is named in the article is the builder and they, they, it sounds like they're still in R&D. Google's getting behind them, backing this R&D to help this nuclear, this microtechnology, come forward. It even states that they haven't actually made any site selection on this, so it's very much in an incipient phase of development. But we're trying to cover some of these relevant moves in the market before they happen.
Speaker 2:Hence the frontier. There you have the frontier, there you have the frontier line. We want to be, we, we choose to exist on the frontier line. Google definitely exists on the frontier line.
Speaker 2:They do, and I'd love to see them putting their money where their mouth is and joining this in this way, because I mean, I think we all agree here that these, if to the extent and we've talked about Invictus actually investing in many nuclear reactors, yes, if we had an opportunity at some point in the future, because we're having conversations with folks in R&D currently two in Utah that have approached us for $5 million here and a few million there. We would love to see that because the implications are far reaching. I mean just the consideration of being off the grid and being able to plant one of these reactors somewhere and then connect a micro you know, or, excuse me, a smart microgrid to it and be self-contained somewhere in the middle of the desert. You know, obviously you have factors like who's going to run that and how are you going to handle sewer, but you can handle all of it.
Speaker 1:It's interesting, it adds to the whole solution set of what's coming forward. I love looking at this space and seeing all the innovation and entrepreneurs and the really, really brilliant people saying how do we, how do we tackle these big problems? So where there is a a block, there is also an opportunity to fix something, and we're we're seeing that now. We have talked about energy and availability of energy and you know realize the natural progression is well, how, where does nuclear eventually come back in and fit into this solution set? Because if we're talking about expanding the grid out to the level, if we're just talking about even the US grid to the levels that we think it's going to need, and we're talking about doing it in a sustainable way, nuclear is the logical conclusion of where most of this goes, because it can be considered very clean Zero emissions, zero emissions, and I think when we've talked about some of the newer developments in the last 40, 50 years and I say newer I mean since some of these problems they've.
Speaker 1:You know, this is an industry that's progressing, even though it's really really capital intensive, it's very hard to get into it. It has been progressing, capital intensive, it's very hard to get into it. It has been progressing and there are lots of developments in the space to make it safer, to make it better, to make it less impactful. And if you solve those things, you see where nuclear ends up being that at that end. I guess the end solution in many cases and it might be, it's going to be these. They're called SMBs, these small modular reactor, smrs, small modular reactors, and I think you know Google's one. We see other big companies doing this. It kind of reminded me of something. It's interesting, because I sit here, you sit here and you see all these massive corporations and you think that the innovation they've done their thing, they've come out.
Speaker 2:Microsoft's done their thing.
Speaker 1:Google's done their thing, facebook's done their thing and all of a sudden they surprise you, right, and you're like, wow, how are they doing this? And I remember something Bezos said years ago and he said you know, ultimately he wants his executives, his C-suite people. He doesn't want them working on today's problems, he wants them working on tomorrow's problems and, if they can work on the three and the five-year problems and making those very critical decisions now for the future. Every organization has those people who have been looking at what is the three or five-year and we're seeing some of that stuff in the energy space coming out now, I think where they've been probably studying this, looking at like everyone else going, how do we get and compete in this space, and they're finally making their moves.
Speaker 2:I agree. One of the headlines that I read through and didn't choose to cover today, but I'm going to bring it up because you bring up Bezos was that Amazon joins the ranks of Google and Meta to invest in nuclear. There you go.
Speaker 1:So that was a this morning headline. Amazon joins the ranks.
Speaker 2:So just what you said is happening and it is fun to see Focusing on engineering problems of the future, trying to have the foresight, and as fund managers and developers, we're constantly focused on trying to engineer 10 years ahead of the future, 20 years out in advance of where we you know, so we can stay ahead of, to the best of our abilities, where the path of growth is, or where the tech and where the demand is growing, the path of growth of that demand, absolutely.
Speaker 1:You know, in our episode with Ryan Miller, our our partner, co-founder, you know, he he's, he's from Alberta, he is, and so this headline stood out. But it also stood out for a reason that I think is interesting, because as much as we talk about the positive and the positive side of the space, the frontier of this space, we're seeing different versions of pushback and how are, how, how are communities dealing with this? And I bring up Ryan in Alberta because this is something that's coming out of Alberta right now. And I bring this up to point out that every community, um, if they're not dealing with this right now, or if they haven't had to deal with this right now and is is, we'll probably have to deal with it. And I just thought it's worth sharing to see, not necessarily that I agree with Mu or disagree with Mu, it's just these are groups.
Speaker 1:There are a lot, there's a lot of debate in this space and it's going to, it's going to continue. So the better you are aware of this, I think, the more informed you're going to be, uh, in kind, of your own community. So this is coming up out of Alberta new restrictions could close off 40% of Alberta to renewable energy development Holy smokes, which is interesting to me.
Speaker 1:So you see to me. I see, you see a, you see a pushback from maybe old industry saying, perhaps saying we don't want renewable here's the bad part of renewable and we see some competition coming out saying, well, no, we don't want to let go of this Understandable. And so this is the article it came out of the. This is from Energy Mix climate news that makes a difference. The Alberta government is proposing additional restrictions on wind and solar farms. The conservationists think are more about limiting renewable energy than protecting the environment.
Speaker 1:Last year, the provincial government imposed a seven-month moratorium on new renewable energy projects, after which Premier Danielle Smith announced her government would be taking an agricultural-first approach to regulating renewable energy project locations. That approach includes banning renewable energy projects within 35 kilometers of pristine viewscapes and parks and protected areas, and a near-total ban where soil conditions are primed for yielding crops. I actually love that. It's very interesting. This is what I'm saying. This is very interesting how, how each community is dealing with its own issues Right and its own sort of mix of and so yeah, I was.
Speaker 2:I was biting my nails to hear the punchline of the headline Okay, what does that? Mean, why would they do? But that makes absolute sense to me. That's congruent with what our ambition is. I agree, because how shitty is it if we gobble up hundreds of thousands of acres and put these ugly solar panels on them in exchange for pristine views? Or agriculture, or agriculture, or agriculture.
Speaker 1:You can't do that. Yeah, you can't grow anything, at least as far as I'm aware. Again, the internet will correct me if I'm wrong. You can't grow much under solar panels.
Speaker 2:No, no, you can graze cattle, I mean, you can graze sheep, you can do some things. You can probably grow a few plant species under solar panels that could potentially be, you know, harvested for biochar. But we argue that the density of solar and wind is not good enough to just have widespread adoption everywhere. We've got to have a good mix, and I'll bet you Alberta's already got significant solar and wind resources developed and so they're just saying, okay, that's enough.
Speaker 2:We've got enough. We've met the quota. What else Of what we want? Let's get more dense, clean, reliable baseload, and it probably does include some of those fossil fuel rich resources that they have in that region, like natural gas.
Speaker 1:Yeah and I'll. Yeah, I think I think you are spot on and I will. I'll finish up here, and we could. So. Critics of the sudden moratorium and new renewable energy only restrictions, such as Alberta Wilderness Association conservationistsist Ruping Luo, have said that the United Conservative government is being heavy-handed. It seems very clear that this is not about environmental protection, said Luo. Back in February, smith also said the government was planning to go beyond viewscapes and cropland and would consider imposing further restrictions related to Alberta's native grassland areas and irrigated and irrigable land Irrigable, thank you.
Speaker 1:A first look at what those grassland and irrigated land restrictions could be was made available when the government asked some municipalities, industry officials and landowners for input. This summer, according to a webinar conducted as part of the engagement process, alberta is looking to prohibit wind and solar farms on irrigated land. Land that could be irrigable could also be prohibited, though analysis would be done before decision was made. So they continue to go on. I mean, this is a very, very significant article. But again, this is a very interesting thing. You've got municipalities saying we actually, we want sustainable, we also love our land, we love, we want to be able to grow there, we want to, we want to keep these landscapes in a more, if you will, traditional way.
Speaker 1:100 and uh, this is a. This is a kind of a fight. I didn't, I didn't see, but it it makes sense. When you finally get into it, you, you see why it's being fought about and you can see why. Certainly, one side is saying oh no, it's big oil, it's big power, but it's not. It's a complex, nuanced challenge, as are all of these things. It's not zero or one. In most cases it's a zero and one and all the numbers in between, and you have to have a nuanced solution for each area, and that's what we're finding in our experience in talking to different areas.
Speaker 2:Every area wants different things and has different demands and different expectations, and it's working towards finding what works for the most, for the most and for all it's such, it's such a mantle of responsibility to be a regulator or a legislator and I and I I tend to take a fairly negative, skeptical approach when I'm talking about legislators globally, but this is an example of a very responsible, pragmatic approach that I 100% support. You know, we here in Utah we've got we pride ourselves in Utah with having some of the most diverse landscapes on the planet Earth. You know, we've got Arches National Park, we have Canyonlands, we have Zion, we have mountain, we have mountain, we have high-altitude mountains, we've got desert scapes, we've got valleys, we've got all of the things. So it's a very diverse situation here in Utah and to protect those, you would never imagine putting some of these renewables in some of these places because they're so beautiful and they're that you can't replicate that, no, you know anywhere in the world. So that I love that and look uh well, the southern square.
Speaker 1:I've always said this you know you go look at all I mean well, on social media and whether it's instagram or tiktok or facebook, and you look at any of these like best pictures from the world. Yeah yeah, we are pictures from utah are always on us always, always, always, always on there and and you know, and there are also places all over the world.
Speaker 1:You, you don't want to mess that up- yeah, you wouldn't want to, whether you're in utah or whether you're in any other part of the country that has something so unique and so interesting or just so important to the local culture that you know you don't. You don't want to mess those things up.
Speaker 2:Well, pragmatism is, is the, is the way to is, is the prudent approach here. We covered Operation Gigawatt just a while back with Governor Cox. I'd love that he shares this pragmatic attitude. What, what he? I'll go back to what he quoted when he announced Operation Gigawatt. He says here in the state of Utah we're really dealing with an and and and more of approach and you've got to really have that. You cannot be a sycophant to the renewable sector and just be hard pegged over to that spectrum. We've got to do all, all wind and solar, and you know all renewable and you also can't be. You know the big, the big. It's all coal, it's all traditional, cause that's what works and we don't. You know why change something that works? You can't it. There's no room left at the ends of the spectrum, it's all in the middle.
Speaker 1:We have to find solutions in the middle. And there are a lot of solutions and there's a range in that spectrum, and so if you're pissing off people on both sides, it probably is about right. Yeah, yeah, absolutely, absolutely.
Speaker 2:You know, while we're talking about this range of power production and renewables, I'll just hit this next title or this next headline here from datacenternowledgecom, and the headline is data center emissions Virginia, texas, california top the CO2 chart. Now that's not a surprise, because we know, you know, virginia, texas, arizona they bring up Arizona later in the article here but we know Virginia is like the metropolis for data centers, and so this study done by known host has gone in and they've calculated, based on the megawatt hours that data centers are consuming. How does that triangulate back to the power that they must consume, are consuming? How does that triangulate back to the power that they must consume? And then you know further triangulating the tons of CO2 per megawatt. And it's an interesting study and it obviously ranks, you know, virginia up there at the top, texas ranked number two, ohio and Illinois actually came in in the top five, california was third, and then they've got a good map here. Utah is obviously not on that map.
Speaker 2:As I'm scrolling, there was one point in this article that I really wanted to underscore here, though. This is a quote from Richard Clifford, the director of solutions at KeySource and data center and infrastructure design consultancy, uh, and he says. Ultimately, collaboration between private energy providers, regulators and policymakers is essential for managing the long-term sustainability of the grid. Amen, clifford.
Speaker 1:Yeah, way to go.
Speaker 2:That's that, richard. Richard Clifford hit that nail on the grid. Amen, clifford. Yeah, way to go. That's Richard Clifford hit that nail on the head, and that's unfortunately something that is not. That's maybe some of the latency in widespread adoption of any power production or grid expansion kind of initiative is getting all the stakeholders on the same page. That seems to be the hardest challenge in this entire landscape. If I was going to pick one, I yes yes and yes, well, any.
Speaker 1:Any time you try to get a whole group to agree on one thing is a difficult usually a difficult prospect. It just is. Yeah, you know, we all have our opinions and our ideas and our experiences and they come to it. And I think, in this case, and everybody in all those groups you just mentioned, all have their own reasons for doing what they do. And so, yes, but, but finding a way forward is you've got to have some leadership, and by leadership, you've got to have people who are actively engaged in bringing the sides together, talking through it, finding solutions that at least both sides can live with. Or how do we move forward? How do we get this? How do we continue on? Because what we're seeing is there's not a choice in my mind that you can't not deal with this.
Speaker 1:You have yeah, I mean, I want my elected officials and you know whether it's it's, you know, the ones I vote for here in utah or on the federal level. I want them to be an actively engaged in trying to solve this, this issue, because it is. It is a giant one. I mean, there are plenty out there in, in, you know, in any landscape, but this is, this is one that's going to affect and will continue to affect all of us, and there are other implications if we don't solve it in a meaningful way.
Speaker 2:I agree. I agree. There's another really great quote coming out of the same article from Andy Svengros, who's the managing director of data center markets for JLL. Now, we've worked with JLL many, many times over the years. Jll is one of the most well-renowned real estate data compilation companies. They do have a financial consultancy. They can help with financing, but they do big feasibility studies. They do data really well and Andy is quoted here saying you're seeing very big issues in California with regards to power availability, with Pacific Gas and Electric Company and Silicon Valley Power unable to support any more data centers until 2030 or 2035. So these are some of the biggest power companies in our country and we're saying that for the next decade a decade, potentially unable to support any more data centers.
Speaker 2:This is why we're talking about what we're talking about Absolutely, and I think about that.
Speaker 1:I'm like, okay, if you're California, don't you want some more data centers? Possibly I mean they might say, no, no, we don't. Because it's like, okay, if you're California, don't you want some more data centers? Possibly I mean they might say no, no, no, we don't. Because it's like, yes, but the job, they're good jobs, it's great, it's much needed infrastructure. It's sort of like it's going to, if you're California, it's going to hurt not to have some of that business.
Speaker 1:Some of that business which we're're happy for is going to maybe come to some of the other big square states surrounding california. Absolutely, we're banking on that. We're banking on that as we're seeing, or we're seeing, you know they can't do it, fine, we'll do it and we'll do it here and I think, utah to your. To back to what's happening in utah and on the local level, you see a, you know a administration. Right now, the governor who's driving this type of initiative is trying to get Utah down a pathway of understanding that we have an energy future and that there's a lot in energy if we can take advantage of it Absolutely.
Speaker 1:And speaking of politics, you know this is a little bit micro, but you mentioned Arizona. Depending upon when this episode airs, we're obviously in the middle of an election cycle and this is something that got done and I thought it was interesting because, again, this is another example of taking this large issue of how do we deal with the expansion of our grid, or the fragility of our grid, and what does it mean on a local level for local people? How are groups dealers? We started this episode out by talking about what's happening up in Alberta and how they're trying to solve this. Well, here in Arizona, the Arizona Corporation this is a came from some reporting from Wyatt my scow for insight climate news. The Arizona Corporation Commission election will determine the state's energy future, with three seats up for grabs, amid debates over fossil fuels and renewables Wow. So basically, they're saying this election right now will decide the future of how Arizona deals with this. Wow, it's a big thing. So, in short, some notes from the article.
Speaker 1:The Arizona Corporation Commission oversees state utilities and has recently approved controversial gas plant expansions and rate hikes. Environmental groups and the Attorney General have sued the commission, arguing that it prioritizes utility profits over residents and climate concerns. Three Democrats and three Republicans are competing for the seats, with key debates on grid reliability, yikes and the future of renewables like solar energy. Yeah, key quote from the article the commissioners will be constructing the future of our state and whether that state is going to be livable, said Joshua Polachek, acc.
Speaker 1:Democratic candidate Obviously that's where that's coming in. Democratic candidate Obviously that's where that's coming in. And then you know the overall. Why it matters for this article is Arizona's extreme heat and energy demands make it crucial to balance energy reliability with climate goals. The election will shape whether the state invests in more fossil fuels or shifts toward renewable energy sources. Very, very interesting. And again this comes back to it it. It would appear. I'm sure the truth is a little bit different, but it would appear that the you know the the future of how this goes could really truly rely with three people wow yeah, in arizona.
Speaker 1:Maybe that's a good thing, maybe it's not um, it depends upon, probably what side you're on, but it shows that each community is dealing with what this means. And they're there. They've obviously hit on all the things Reliability of the grid and you know Arizona's not, you know it's it has its own interesting challenges.
Speaker 2:Yeah, yeah, that's really interesting, yeah so thought that was a good one to share. You know we've kind of we've been that we've done a pretty good job of avoiding politics by and large in most of our episodes we do it's.
Speaker 1:I think we're still doing. It's not bad to bring, it's not bad to bring some of this in.
Speaker 2:It is relevant. We talk about legislator. We we beat up on gavin newsom, you know yeah, we did that justifiably. But that's that just sorry, but it's relevant to the context of what we're talking about.
Speaker 1:Well, and you know the thing we just talked about California and PG&E we're one of the largest utilities in the country and you look at how they're probably rightfully trying to solve issues in California and they're probably saying like, look, we can't, we want to. Maybe I would imagine we want to. Maybe I would imagine they want to. They would love to be able to have a client like a data center. They'd love to be able to support that, but they're also they've got to keep the lights on for everybody else and they're probably saying like, look, we, we can't. And then you bring in fires and the again, fragility of the grid and what it's done to the grid and just all the challenges they're facing.
Speaker 1:And then I happen to know that they happen to bring in a lot of gas, like all their gas from outside their state. So they're also pulling from all the states around to try and solve their problems because they're trying to deal with local policies that make it really hard for them to do business.
Speaker 2:Well, I think what you just said hit it on the head. When you legislate yourself into a box, it's hard to legislate yourself back out of a box, and so California has done a really great. They've given us a great example of of really, really committed proponents to this whole renewable, sustainable initiative. Green green, green. You know killing contracts on viable power solutions. Here in Utah We've talked about that With the hope and intent that they'll find renewable solutions, all the while maybe somewhat blind or naive to all of the impediments that we're addressing with this show Ryan Miller mentioned when we interviewed him here some time ago.
Speaker 2:He brought up this analogy of runway, and I can't help but think of some of these states like California. Arizona could be right there with them quickly, when you get out over your skis a little too far or you don't have enough runway, uh, because we couldn't imagine not thinking 10 years away. Or maybe it's just the opposite. Maybe it is trying to think 20 years away with no idea how to bridge a 20-year gap Right, and maybe it's a little of both.
Speaker 1:We have this great goal, but, okay, well, how do you get there? How do you pragmatically get there? How do you get there and then keep power on to all your residents? You want an electrified grid. You want to be able to have everybody to have electric cars, even though there could be some debate about that and you could talk about the other impact on electric.
Speaker 1:All that stuff being said, how do you get there? Yeah, how are you going to solve that? Well, we were saying to go and we're going to solve, okay, well, how are you? Are you really solving it or are you pretending to solve it? We're pretending to be green because, well, we don't have any gas. We're not, we're not mining any gas, or, yeah, because you're getting all your gas from the surrounding States. That's why, yeah, white, yeah, is that really green? You know, in your using your definition, yeah, right, is that really green?
Speaker 1:Are you really doing this? Or is it just show for show? And I think we've talked about that and, to your point, it's, I think, a little bit of it, or maybe a lot of it's for show, and it's put you and it's put them in a box. Yeah, and, and it's a box, that's, it's right, it's not going to be easy to get out of, but we're all going to have those versions of boxes in our, in our local communities, municipalities, states, counties, cities and and so the onus is on.
Speaker 1:People that you know kind of pay attention to what's going on and, like you realize, this is this stuff's happening and there are going to be small groups of people. It was always politics, politics about people who show up. You know they're going to be, you know, and it's only a few people show up and they're the ones making the rules, make the decisions for the rest of us. And so you've got, if you, if you have a say in this, you just have you need to make you know, need to make sure you're aware of what's going on.
Speaker 2:So it's kind of where this comes back to. So you, just you, reminded me as I'm listening to you reminded me of a headline that I almost I wasn't gonna, I forgot about it. I shared this one with you earlier this week. You did.
Speaker 1:That was a good.
Speaker 2:That was a good article and, and I got to bring this one, this, this deserves this deserves a shout out. It deserves credibility. It's right here in our state of Utah. This was just published this week. This is an opinion piece from a leader in the Utah community, the head of the Utah Petroleum Association.
Speaker 1:And before you dismiss, it depending on the viewers. If you're like, oh well, of course, this person is going to have an opinion, yes, but you should listen, yeah, you should absolutely. I'm encouraging you should listen, yeah, uh, you should, absolutely. I'm encouraging you to listen. If you are of that like, oh no, I'm going to completely write it off, because consider the source. Yeah, um, under, I would also do this. Yes, consider the source. This is somebody who has who has lived and been in this industry for a long, long time and who is saying I understand and I hear, but this is, this is the reality. So I'll set that up.
Speaker 2:Well, this was a guest opinion piece provided by Ricky Franco-Browning who, as I said, is the president of the Utah Petroleum Association. But as I've researched Ricky's background and history, this woman has spent a lifetime not not only in education but working for major companies shaping energy production initiatives abroad, in Estonia, on the borders of Russia. I mean, she is a force to be reckoned with, and it's no wonder that she's found herself in Utah at the head of this organization. She's come up through the ranks and proven herself in this space. She has established herself as an authority figure. And so what she's saying here the headline is why Utah Should Generate More Electricity from Natural Gas Okay, okay.
Speaker 2:And she goes on to talk about, to put it quite blankly, building out more natural gas capacity. We have some huge oil and gas shale deposits in the Uinta Basin here on the east side of the state of Utah, and she's intimately aware of the goings-on in the Uintah Basin. She's throwing statistics into this, but she's saying that I love some of the language she uses here. She says I know that it's not exactly a novel talking point from the president of the Utah Petroleum Association, but bear with me Utah is flush with natural gas, according to the Energy Information Administration, we rank 13th in the country in natural gas production, yet only 25% of our electricity comes from natural gas production. This makes no sense. It makes no sense because what looms ahead is the great power generation reckoning.
Speaker 2:Some utilities across the country are doubling their demand forecast for the next five years. According to the International Energy Agency, demand for natural gas is set to reach an all-time high of 4.2 trillion cubic meters. Yes, trillion this year. Okay, and she goes on. She on here just just underscoring with data, uh, from a national level, uh, citing the department of utah, department of commerce, federal department of commerce, um, referring to ai, recognizing what we've been talking about and saying look guys, gas is quite clean by comparison with some of the other fossil fuels. Is it perfectly clean?
Speaker 1:No, no, it's not no, but it's a step, it's the step, it's being called a gateway resource.
Speaker 2:It's being called a gateway resource that can bridge us Quickly. It's being called a gateway resource that can bridge us quickly to that 20-year or 50-year mark when renewables are predominantly the source of power production in our nation and globally. But that's not happening this year, it's not happening next year, and so what do we do in the meantime? Nuclear is super promising, but everything I'm reading is saying 10 years from now, six to 10 years when these things start coming online. Okay, so what do we do for 10 years? To me, natural gas seems like the most legitimate, abundant, cost-effective, clean for all the reasons, like it checks all these boxes, and I really appreciated Ricky's work on on this opinion article. I want to thank her and shout out uh for getting this into the hands of the deseret news local paper here in salt lake city.
Speaker 2:So great work. We support this. Uh, anyone who is interested and seeing things the way we see them on this front, by the way, should go and research the Utah Petroleum Association and sign up as an advocate at Utah Energy United. We've done that and we're ready to stand up and be an advocate for the natural gas industry in Utah. Now we're coming up on time and I know you've got a hot one here, dave. Oh, I can go into it, so let me turn it back over to you and we'll just wrap it up.
Speaker 1:Well, we'll just wrap it up, we'll just go with it. Yeah Well, this one was more of a. Again, this is a. We've talked about this too. We've talked about it on multiple occasions. It just was another article kind of underscoring that there's a complex problem out there. There's complex problems out there. The IEA is warning about critical. Mineral shortages could hinder renewable energy transition. Meaning this is the other side of the coin of like, as we're. We're talking about transformers and some of these other parts.
Speaker 1:They're saying, well, also, they're all these minerals that go into making, uh, or being part of these batteries yes, this renewable renewable solutions and you know the the article goes deep into the geopolitical landscape of that China, us, china having a lot of access to a lot of natural resources, us needing to maybe pay attention to it.
Speaker 1:So even wanting to go there is, you know, we're going to run into challenges there and also we have to figure out how to solve that. I mean, if you're in the renewable space, having to solve supply chain yeah, is is not a thing that's going away. And so even if we're saying you know what, you know, take, let's take a state and let's make it all solar, yeah, whatever, just the, the amount of materials needed to do that, um, it's limited, and so that's also going to start needed to do that. It's limited, and so that's also going to start factoring into how we see some of these things coming online, or even the availability. And I go back to there's a ton of solar sitting unconnected, so we've got to solve that first. But you mentioned something thinking of solar and kind of a couple of the other California, remind me. On California, didn't they limit solar? So there's something with solar.
Speaker 2:Yeah, it's referred to NEME 3.0. It's a new regulation that came out this year that cut the rate, the buyback rate, by I think 80% for rooftop solar panel owners on homes. Okay, that was it. Like they'll use the power from their panels and then they were led to believe, or it was set up, that they could resell or get credits on their power bill by pushing energy back onto the grid to help kind of stabilize the whole grid capacity. Well, now that that rate's been cut, it's affected all these homeowners and SunPower as a result has gone out of business. This is one of the largest solar panel companies in the US.
Speaker 2:That was the California situation, and I'm compelled to share. A final thought, Dave, based on what you were just sharing about the IEA International Energy Association. Sharing about the IEA International Energy Association. Folks, if you follow the show and you've been paying attention, we're into 20-something episodes at this point. Please don't forget that China has its own set of rules. I'm reading about China producing record amounts of coal. So if China's producing record amounts of coal, Okay. So if China's producing record amounts of coal and utilizing coal to produce power, there is a race, a global energy race, happening and we're in that race, competing with China, and Russia has to do with oil, coal gas, and Russia has to do with oil, coal gas. And if we really want to be pragmatic about this whole thing, you can't be on a renewable-only situation when everyone in the world, like China, major producers, are doing something else. That's my alarm. I'm going to wrap it up right there.
Speaker 1:That's my cue to end it. That's our cue to end it today. Thanks everyone for joining us once again on the Frontier Line. Until next time, thanks guys.
