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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
Utah GOP Leaders Demand that Rocky Mtn Power Divorce from Pacific Corp, Private/Public Partnerships the Only Solution, DOE Weighing in on the Call to TRIPLE Power Production Within 36 Months
Welcome back friends, Dave, so happy to see you. Good to see you, Wayne. Good to be back with everybody.
Speaker 1:It's been a heck of a few days here this last week. Lots of fun to talk about and wanting to dive into some headlines here with you. Maybe some of the goings-on of the last week will bleed into some's head. I think they will, because most of these headlines that are coming up this feels super relevant to me are around regulatory enhancements. They're around tax kind of jurisdictional tax kind of movement and some interesting things on that line. So I'm not so much focusing at least my headlines on the dollars being spent here, but some of the things that are going to need to happen for those dollars to actually be able to deploy. That's right, and I know you've got some phenomenal articles too. Do you want to kick it off for us?
Speaker 2:I was going to say you should kick it off on those things. Do you want to start with those blockers that are going to need to kind of be dealt with and maybe localize it and so talk about what's happening here, or do we want to go into?
Speaker 1:that later. You know why don't I kick it off with the, with the local, this local headline?
Speaker 2:Because I think this is what you've said is relevant at all these jurisdictions in the country. It doesn't matter where you are, whether you're in Utah, wyoming, you know, georgia, ohio, these these are, these are conversations going on at the municipality level, at the state level, about how and why and what and what's going to have to be done when you're starting to deal with utilities and regulations and all kinds of things. And I think this is a really good description on a local level, of exactly that.
Speaker 1:Yeah, it is. It's one example of many that we'll address here in the episode, but this particular one is a KSLcom article that dropped the headline here Top Utah GOP Leaders Want Rocky Mountain Power to Divorce Pacific Corps. Those are fighting words. Those are big fighting words. Now for our listeners' perspective. Pacific Core is a multi-state power company and the parent company currently of Rocky Mountain Power. Pacific Core happens to have a major presence in our West Coast states Washington, oregon, california. One can only surmise what those energy goals might be in those jurisdictions for Pacific Corps, dramatically different than what we're experiencing here in Utah, wyoming, idaho, arizona, nevada.
Speaker 2:Nevada. No kind of wholly different needs. Yeah, wholly different needs. Really, it's a different climate, different area. Obviously, you've got a lot of hydropower, although we have it out here in the big square states, although there are big square states too, those you know with the ocean there and the possibility it just changes. And the amount of rain, yeah, water, yeah, water changes the picture on electricity and production and data centers, and it's just. We just have different issues.
Speaker 1:Well, and on a geopolitical level, as I've read through the article, it's really it has a lot to do with Pacific cores, commitments for sustainable renewables, Like there's a really heavy emphasis, Like we've been beating up on california from day one for this myopia over the the fully sustainable thing that we know isn't isn't realistic. But you know, washington oregon embraced a very similar mentality and so we have governor cox and other leaders here in the state of Utah opposing it, saying look, Operation Gigawatt, we need to be more of all of the above. We are awash in natural gas. We have lots of coal capacity. Why are we not leveraging what we've got to bridge us to this inevitable future of sustainability and recognizing the pragmatism behind that? This could be a 20-year transition, might be an 80-year transition. Who knows actually what it is? California thinks it's a two-year transition. They think next year it's fully sustainable. Everyone's already backpedaling on those short-sighted commitments.
Speaker 2:Realizing that there's no way in hell. Yes, under any best-case scenario, no, and that's not even taking into account some of the policies that have been proffered like oh, we're going to, we want everybody to be on the cars on the ED side. Realizing that the infrastructure just doesn't even exist? Yeah, you know much less the amount of power that's going to be needed to do these things.
Speaker 1:That's right. That's right. So KSL states three key takeaways of this article here, which is that the Utah GOP leaders and Governor Cox urge Rocky Mountain Power to separate from Pacific Corp to align with state energy goals. Number one, number two Rocky Mountain Powers. President Dick Garlish acknowledges frustration and complexity in restructuring these efforts. In the article he specifically states that while the request is noted, it could take 18 months or more for us to analyze the implications. You know, and I'm very, very noncommittal about, you know, taking a stand here. And then the third point is that lawmakers emphasize urgency due to rising rates and power interruptions affecting Utah's economy.
Speaker 1:So Rocky Mountain Power, governed by Pacific Corps, sitting here kind of accomplishing mission a, which is protect the power, pricing and the power kind of availability for its its current customer base in the state of utah. They've done that historically fairly well. Now that we have the great divergence of power, spiking demand away from population growth curve, we understand that Rocky Mountain Power is not alone. They are one of every utility company in the United States who are not going to be capable from a resources perspective, from a timing, from a regulatory, for all the reasons incapable of meeting this demand. And so this is what's so fun about the Frontier Line show here is we get to talk about all the ways that we can accommodate this new demand Absolutely, and we're perfectly positioned to do so.
Speaker 1:I want to go a little bit further.
Speaker 1:In the article, dave, you know there's a quote here stating in essence that Utah leaders do not want to be hamstrung or financially harmed by Pacific Corps' other member states like Washington, oregon and California that don't share the same energy goals. Guys, so when you have this huge utility, multi-state utility, with left hand and right hand different goals, you goals, different needs inside of communities. There's a fundamental lack of meeting community needs and we've been talking now for some time about energy independence within communities. In fact, I'd love to see someday in the future a Community energy independence act. That would be interesting, really cool thing. I like that idea. Maybe we'll sit here for it upon ourselves, sit here for the communities energy independence act, because you know we recognize that it makes a lot of sense for us to take care of the communities that we operate in on a micro perspective the small town, main Street, usa communities and it makes zero sense for our small rural towns in Utah to be governed from an energy perspective of whatever the heck they're doing in California or Washington.
Speaker 2:It's Frankly, any of those in the state of Utah and vice versa. You're right.
Speaker 2:And I think there is that opportunity coming. And there's the other part of this, which is I don't think anybody wants to see utility rates go up, and any conversation we've seen, any article we've read, anything we've heard regarding utilities, building extra infrastructure out always comes along with. Well, we need to socialize the cost of these buildouts. It's private industry asking for these things. Yet private industry, like us, is willing to actually solve these things and jump in. Private capital is willing to jump in these things and jump in. Private capital is willing to jump in and solve some of these things and in doing so we're creating a solution and a possibility that didn't exist before. So is there an advantage, for example, for a community to be connected to a grid if, say, their local power production goes down?
Speaker 2:Yes, well, those technologies and those kinds of relationships are starting to happen to where you can have your cake and eat it too. You can have a grid that maybe services an area that was paid for by private capital, that didn't push rates up in the area, that is mindful of keeping that community. You know, of being able to offer some real value to the local community, because their goals are usually beyond that community. They're not looking to those communities to make money off of. They're looking at other bigger kinds of energy uses, manufacturing, data centers and the like, and so while they're doing that, that's great, but then if they're, you know, if that, if that private group can then connect to the grid and be interconnected to a grid so that, in case a problem happens to be the thing that we've talked about and the, the, the, the name or the, the, the phrase that we've talked about a few times and you've said, I think last time, which is a grid resiliency partner, yes, so where a private industry or a private work could actually be an additional help to that, you know, a spoke on that rim to help help boost the grid when you need.
Speaker 2:But then take care of local, yes, and and without the, the burden of extra, of rate increases and rate increases and rate increases. And we're seeing that on a local level. You and I are seeing it on a national level, because anytime you want to talk to a utility right now about adding extra capacity, they're going to say, well, in order to do that, we're going to have to increase rates. Yeah, yep, and so that's kind of where we are.
Speaker 1:I think it's a value to actually share some of these quotes because I don't want to villainize for the listeners a really unfairly biased kind of are really like we are biased, like we know which way we want this to go. But I want to be as fair as possible and so I'd like to share a couple of quotes that go back and forth in the article about some of the recent arguments on the Hill, because we've got comments from Rocky Mountain Power, from Mr Garlish and his first comment here, and I quote I want to be clear. I was listening this morning. I heard very clearly that this legislature wants to pursue the full restructuring and I offered this morning an offer again we can begin that deep, more detailed analysis because it is quite complicated. Garlisch said we think it will take 18 months to really determine what the options are for the structure and the legalities of how to do it. Okay, we go on further, garlisch stating he says I'd say that when we were all aligned about what all that meant in the six states, which is putting together this Pacific Corp model for six states and the largest transmission system in the country. He says, first of all, just the circumstance we're in an inflationary environment. Things just cost more and we're dealing with extreme weather that we've never had to deal with and investments that need to be made on the system. He says he understands the emotions that are wrapped up in this issue. He says I get that people are frustrated. I get that the legislature is frustrated. I get the customers are frustrated. People are frustrated, I get that the legislature is frustrated. I get the customers are frustrated. I'm frustrated, but right now it is the structure I still have. What's in my gift today is to provide the service, keep the investor engaged, stay as reliable, keep it affordable as possible and then fix six state commissions and the federal government to make sure that I have the money to keep the utility financially stable and healthy.
Speaker 1:Now some of the opposition to that Senator Dave Hinkins, says it would be ideal to go back to the old Utah power and light structural model, which included the member states of Utah, idaho, wyoming. The interior states have far different energy goals than the Pacific Coast partners who are pursuing green energy. He added, inordinately burdening Utah rate payers. Garlisch said he's heard the frustration from other states, and Oregon approached the company about a decade ago with a similar desire to opt out. Here's what's interesting is that Pacific Corps is saying we want to opt out and we're not getting along and we're going to. You know, oregon wants to separate Right, and so our legislators, specifically, are, you know. It just seems ludicrous. So if they want to go their own way, fine, let them go, but we shouldn't have to be part of that. And that's why we're confused, you know, frustrated.
Speaker 1:Like any split, costs and legalities of this are obviously a factor. This is cost not for the state to bear, but this is us, the ratepayer, that is going to end up paying this. It's like taxes, right? Senator Nate Bluen, a rep in Salt Lake, wondered if the goals Utah is trying to achieve affordability and reliability would even be possible in a balkanized system that is the result of downsizing. Pacific Corps Reps Carl Albrecht and Senator Carl Albrecht stated that Rocky Mountain Power needs to deliver on the answers lawmakers are seeking sooner rather than later. And it goes on and on, with quite a bit of conversation. To your point, dave, of the fact that the rates are going up, the service is going down, and those are the metrics of the failure of Rocky Mountain Power in this current energy transition, trying to meet this extraordinary new demand. Everyone recognizes AI, all of our leaders recognize AI of centers. But they recognize that the state of Utah cannot grow to meet its economic goals unless we can bring on more power and bring it on fast.
Speaker 2:And they are in a very interesting position to where, to your point and this is this and to the point of the article is you're hamstrung by policies that may not work with us. And I do find some irony in it that you know these are, you know, these, the policies of the three States, but they still need our power. They have needed it for a long time in order to meet their goals. Right, they're still getting power from Utah, you know, and it's costing us. It's not, it's not power that's staying here, it and it's costing us. It's not power that's staying here, it's pollution that's staying here. You know it's a byproduct of that, but it's not, and that's been that way for 40 years. So we're, you know. So if we're going to have these things, we might as well benefit from them, and I think that's been kind of the point is like, let's bring it back local, because right now we're in this giant, you know we're, we're part of this. This I mean a very intractable movement of where we can't do what we need to do, and there are lots of handcuffs, and it might be, you know, rocky mountain houses that they have handcuffs and they can't do what they need to do for, for, for, uh, their clients. Um, and I, what I would say and what I've been impressed with is that it seems to me like the legislature here. You know we love to beat up on politicians and I love, you know, I will add myself to that list but what I've seen on this issue is they are trying really hard to get ahead of this and they are trying to solve this. Yeah, they are not sitting on their hands going okay. Well, we'll see how this shakes out. To us, there are lots of active conversations. There's lots of stuff going on, lots of activity to solve this, and I credit them. They are really trying to jump out ahead. I agree, yeah, 100%.
Speaker 2:And all the way up to governor Cox, where governor Cox is like recognizing, like, look, we're having to say no to business and we don't like doing that. And I will, I'm going to, I'll, I'll share with our audience Um, we had, um, we had our architecture team in town. This, uh, you know, when you're hearing this, you know, and they made the comment, and these are people who build buildings all over the world. They were shocked as we drove up and down the Wasatch Front to see so much growth. They're like do you guys realize this is not happening anywhere else? Yeah, to see brand new buildings go up and it's a testament to our economy. Maybe we don't see it because a lot of people don't see how well we're actually doing, but we're doing really well here in Utah. And again, I think it's some of this kind of conversation.
Speaker 2:I go back to Governor Cox recognizing what is the problem. What's the blocker? Well, the blocker is power. How do we solve power? And that's where we are with these conversations. Well, if, in order to solve power appropriately, does Rocky mountain power need to divorce themselves? Maybe, yeah, you know, do, do we need to do this? Maybe? So let's start exploring this and solving this and and and getting other smart people into the conversation so we can, so we're not waiting around and having everybody else solve it around us. Yeah, I like it. Yeah, and I give them credit. I give them credit for pushing this.
Speaker 1:I do too. I feel very fortunate, very grateful, that our legislators are actually on the ball with this one. I'd like to share this final thought that Garlish stated, because I think this is it's important for the listeners to know that the utilities get this, but the scale and magnitude is really important to understand. And then we can jump to the next article here. But Garlisch stated in this KSL article there are three gigawatts of electricity that serve the Wasatch Front and to meet the dynamic needs of these interested companies you have to bump that up to 10 gigawatts. Needs of these interested companies they'd have to bump that up to 10 gigawatts.
Speaker 1:Right now our regulatory system isn't really set up to deal with these hyperloads with the ramp rates they want to go to. It took 100 years for us to build the infrastructure we have today. Some of these folks want to double it or add a gigawatt to the load within like three years. That's immense, a huge economic problem. He says To me I'll read between the lines this is impossible for Rocky Mountain Power to solve. So kind of, throw your hands up in the air and say well, if the state of Utah is going to solve it got to get out of the box. What does that mean? That means soft deregulation. It means independent power producers coming in with billions and billions of dollars of private capital to develop decentralized power resources, decentralized power plants and microgrid assets and advanced storage and backup systems attached to all of it. To improve to you know and really join the fight as true grid resilience partners.
Speaker 2:That's the solution. That is the solution and I think ultimately it benefits the individual consumer actually A hundred percent. You know, we could go historically like oh, in the end, you know the little guy's going to get screwed, and in this one, I don't think that's the case. I think they're going to get screwed if nothing changes. Yes, that's a guarantee. If the government figures out how to work with private industry and let private industry shoulder the financial responsibility of this and be able to do these things and then allow other resources to come online, well, that just means there's more available.
Speaker 2:And, as you and I've talked about a lot, we know, we know and everybody else knows utilities know this too how brittle our grid is currently, yeah, and how much it needs to be updated, so all those things. So this just shores that up. I think in 20, 30, 40 years, our grid and our ability to have enough power is so much better off going the way things seem to be going right now, absolutely. I don't know that everybody's going to be on board with this, certainly probably not, but I think enough will, and I think here in Utah it seems to be that they're figuring that out pretty quickly, yeah, which is which is great to see. Yeah, and I can, I can dovetail perfectly into this.
Speaker 2:Awesome, because you know, talking about the demand of, of what's going to be asked of the grid here shortly, uh, of what's going to be uh asked of the grid here shortly, this hit today, okay, and this is, you know, I, I read, I was like, wow, okay, so the DOE, the Department of Energy, released a report today, um, regarding what, what, what demand in the U? S is going to look like and and and. So, to talk to you, to underscore all of this and why these things have to be done, so Reuters, there's the release, but then Reuters put together an article on it. So I'll read a little bit of the Reuters article written by Layla Kearney. The headline US data center power use could nearly triple by 2028,. Doe Bactra report says Wow, that's a number, folks, that I haven't seen yet. No, I've seen double and triple, but it was always around the 30s. Yeah, never, like you know, three years from now, wow, and that's so much power.
Speaker 1:That's exciting and daunting all at once. All at once, it's everything.
Speaker 2:So I'll read a little bit. Us data center power demand could nearly triple in the next three years and consume as much as 12% of the country's electricity as the industry undergoes an artificial intelligence transformation, according to Department of Energy Back Study that was first reported by Royers. Today, friday, the Lawrence Berkeley National Laboratory produced the report as the US power industry and government attempt to understand how big tech's data center demand will affect electrical grids, power bills and the climate. By 2028, data centers' annual energy use could reach between 74 and 132 gigawatts, or 6.7 to 12% of the total US electricity consumption, according to the Berkeley Lab report. The report included ranges that depended partly on the availability and demand for a type of AI chip known as GPUs. Currently, data centers make up a little more than 4% of the country's power load. Quote.
Speaker 2:This really signals to us where the frontier is in terms of growing energy demand in the US, said Avi Schultz, director of the DOE's Industrial Efficiency and Decarbonization Office. Schultz, director of the DOE's Industrial Efficiency and Decarbonization Office. Swelling data center. Electricity needs are accompanied by rising power consumption from onshoring of US manufacturing, electrification of buildings and transportation. And Don't say Weird, Okay Interesting. We should put a pin in that.
Speaker 1:Let's put a pin in that one, onshoring foreign manufacturing into the US.
Speaker 2:Okay, Overall, us power demand peaked in 2024 and is expected to hit another record next year. And I quote what this report is highlighting is what's actually growing the fastest and the leading edge of demand growth in the US is the very new growth in artificial intelligence data centers. Schultz said Something we've talked about for a while. This is obvious to us and, I'm sure, obvious to everybody looking at this. Findings may inform DOE efforts to increase the flexibility and resiliency of the grid, including construction of long-duration battery storage at data center sites and commercialization of new technologies such as small nuclear reactors and advanced geothermal. Excellent, excellent, excellent.
Speaker 2:Power doubling this is a sub-headline. Starting in 2017, deployment of GPU-accelerated servers led to a more than doubling of the sector's power use over a six-year period. The report said AI, which requires increasingly powerful chips and intense cooling systems, is the primary driver for the projected data center growth. The last report was released in 2016. Ai servers and data centers accounted for about 2% of the total server energy use Reports. Lead researcher Arman Shahabi and his team recommend publishing the report annually or biannually to more closely track data center trends. And I'll just, probably I'll leave it there. Well, actually, one more quote from Shahabi. By showing what the energy use is and, more importantly, what's causing the growth in energy use. It helps us think about what opportunities there are for efficiencies. The report also makes suggestions to further research and development develop energy efficiency strategies for the country's booming AI data centers. New AI data centers are being built with power capacity as big as one gigawatt enough to power all homes in Philadelphia that's it Awesome.
Speaker 1:Wow, yeah, I mean coming from the DOE, I think is what makes that super relevant. Very sober yeah. Scientific approach to this and like what's really going to happen and not some news journalist columnist kind of making his opinions on saturday afternoon about triple the power of the next 10 years. Right the?
Speaker 2:doe, yeah, studying this and really what's going to mean, and that that is, that is so much growth. Yeah, um, I, I think where we are with all of these things, this, this and everything they're saying, it buoys everything we've been talking about, from SMRs all the way to advanced geothermal. You know we, you know, I think we collectively think those are really really good, forward looking things. They are both financially make a lot of sense. They, you know, ultimately they are going to be less expensive Ultimately. You know, smrs are not right now but they will be in the future. And certainly geothermal is one of those things. That, again, it's, it's a little bit pricey right now, but it's. It's a matter of scale and a matter and I think that's going to come down and end up being probably one of the most inexpensive powers and might, you know, might one day, very soon, you know, compete with what we would see with coal. Yeah, yeah.
Speaker 1:I agree, yeah, I agree, vein of what will it take? What's the recipe for the transition? What's the recipe for us to effectively meet this demand, this burgeoning demand? States are getting creative. Countries are throwing their weight in the ring. We reported on Alberta recently in their $100 billion bid to carve out a piece of the data center market, basically attracting hyperscalers to the region. But we're following how many states inside of the US here are coming up with these innovations, enhancements to legislation to support this growth.
Speaker 1:Another interesting article here in Michigan and I want to bring this up because, as we're actually trying to move legislative enhancement in Utah and Wyoming, it's great to like compare notes and see what other states are implementing to do this right. Everyone I think we can all agree that everyone in the US wants to see, they want to figure out how to bring that data center business to town. Yes, I think that's common Right, while we do see some environmentalists trying to oppose it for arguments over emissions or water consumption. Generally speaking, everyone wants to see and they're supporting the data center growth. So legislators in the Michigan House of Representatives have approved extended tax breaks for data centers in a move aimed at attracting business from the hyperscalers. A new law HB 4906, exempts operators that invest $250 million or more on digital infrastructure from sales and use tax on equipment until at least 2050. Wow, this is huge. That's giant. I mean we have guys in the state of Utah right now we've got Governor Cox's Office of Economic Development that's developed their red TIF program for rural communities. It's the Rural Economic Development Tax Increment Financing Structure. What that means in Utah for us is and this isn't specific to data centers, but it's an incentive to develop new business in rural Utah that tax incentive gives the first five years in business a 50% cash rebate on state-level taxes. So to contrast that to this, if you're a data center operator and you spend $250 million or more, which you will in fact, for the record, that's the smallest data center you could possibly think of right now in today's terms, complete exemption from sales and use. So 100 exemption until 2050. So that's 25 years and in certain instances they're extending that horizon to 2065 nearly 40 years of no state taxes for doing this. That's a hell of an an incentive to get that data center business.
Speaker 1:Rep Joey Andrews, who sponsored the bill, said that as technology continues to advance, it's imperative that legislation allows the state to remain competitive economically. That's key. That's key. There's a lawmaker who understands that. If Michigan doesn't do it, illinois is going to do it, ohio is going to do it, oklahoma is going to do it, virginia is already doing it, every other state. So there's a race right now to be competitive. I believe the state of Utah is really engaged in the race and I think to your point that you made earlier here in the show today is that our legislators get it. They're making these moves to get legislative enhancements on the table, ratified in practice and law, so that we can start really recruiting the data center business, and Valley Forge Impact Park has to be the tip of the spear for that. So I think we've got a plan that really nicely fits this.
Speaker 2:I like it when these days flow, because my next headline will fit in and underscore exactly what we're talking about, and it's also a good. It's also it's going to show what this means in a very practical level. When you go after business and you say, look, we want to set you to come, to show what this means in a very practical level. When you go after business and you say, look, we want to set you to come here. What this means, uh, announced today or announced yesterday, pardon me? Uh, furrow energy secured an additional 255 million dollars.
Speaker 1:I noticed that, okay, yeah and that's on top of the 244 million. That was only like right four months, five months ago, five months ago.
Speaker 2:So you, as a reminder to everyone listening, fervo, the Cape Station project down in Beaver, utah, is a giant well, I think, the largest still in North America geothermal project having amazing success, so much so that they're continuing to raise capital at this rate. Okay, so we just talked about what does it mean when you attract? And in this case, we have the right, you know topography and it's, and we've got geothermal sitting under us in the West. We're obviously utilizing that. But I, you know, we know that Furbo worked extensively with the state and they're they're being, you know, I think you know, stay once, obviously, for all the reasons, wants them there to incentivize them to be there.
Speaker 2:Well, now here's what's happening. We have investment continuing to flow into this company and the company continues to add jobs, yes, and real growth, and that's going to help build out the tax base. So this is how we continue to grow and we continue to sustain is, you know, you invest, you give the breaks, you get the right, you get the right, uh, companies coming in and taking advantage of this and they will. And these are not small projects yeah, these are. In a weird sort of way, this is, these are infrastructure projects that almost are almost kind of unheard of in the history of America, like, yeah, how much capital's actually needed to pull these things off.
Speaker 2:You know, I look at like, okay, you look at like the build of. You look at, you know you look at California, you look at Silicon Valley, you know Silicon Valley and you look at the Googles of the world and how much you know the infrastructure they built out down there over a couple of decades and the amount of money you know, say an Apple spent on building just their headquarters, right, you know, say an Apple spent on building just their headquarters, right, well, right now, the you know, as you know we've talked money. You know the tote board is probably over a trillion dollars right now, just in this space.
Speaker 1:It is yeah. So the not including power production, which is right, in data center construction, just data center construction.
Speaker 2:So so these this is a this. In many ways, this is a, this is a massive infrastructure thing happening all around us right now, and so states, municipalities, even countries who get this. This is why there's a race for this right now, because they understand the long-term implication and the long-term value of also having private industry build out power. Yeah, Because what does that do? So when you have private industry and private capital come in and build out power infrastructure, well, that's a pretty good hedge on the future to know that you have capacity to do power, yeah, and that it's not going to just come back to again a centralized. So there's lots of stuff going on here. I, you know, I love you know. Congratulations, Fervo. Yeah, Way to go, we love them, we're cheering for.
Speaker 1:Fervo, we are, we're big fans and we're hopeful to work with those guys, absolutely.
Speaker 2:Oh, I'll read just a just a real bit of it so they can give some credit where it's due. Of Fervo Energy a leader in next gen. So this is in Energy Global online, written by Jessica Casey. Fervo Energy a leader in next generation geothermal development has secured $255 million in new funding and capital availability as it continues to build the world's largest enhanced geothermal systems, egs Power Development. The announced funding comprises both opportunistic corporate equity and new debt financing. Capricorn's Technology Impact Fund No.2 led the $135 million corporate equity round.
Speaker 2:Ferro is excited to welcome new investment and continue support from the suite of high-caliber investors, including Breakthrough Energy Ventures, calstrs, congruent Ventures, cpp Investments, dcvc, devon Energy, galvanized Climate Solutions, liberty Mutual Investments, Mercuria and Sabanchi Climate Ventures. And then the quote was the demand for 24-7. Carbon-free energy is at an all-time high and Ferbo is one of the only companies building large projects that will come online before the end of the decade, said Furbo CEO and co-founder, tim Latimer. Investors recognize that Furbo's ability to get to scale quickly is vital in an evolving market that is seeing unprecedented energy demand from AI and other sources.
Speaker 1:Yeah.
Speaker 2:There you go, congrats.
Speaker 1:Yeah, that's fantastic.
Speaker 2:And there are some names I recognize. There are some names I don't recognize. So there's a lot of groups. Again, this is unprecedented. The amount of money that has to come into this. It's attracting lots, because then there's the AI space that has its own investment. That is just massive. Yeah, so between the investment going on in AI and then the investment in the infrastructure to support AI, it's substantial.
Speaker 1:Yeah, it's interesting. We were talking with Gensler while they were here in town with us just a few days ago and we were talking about the implications of FERVO and how that horizontal drilling with the fracking modality could impact site selection, recognizing that FERVO is located on federal BLM lands, also recognizing that the mineral rights associated with those lands kind of come part and parcel. I would imagine If you're on federal land for a certain footprint, you'd probably need to have secured the mineral rights to be able to frack and do what you're doing with the CGS technology. That could be a preclusion for developing that type of technology inside of different jurisdictions, from private lands, inside city limits, inside counties with different land use ordinance. So that'll be interesting to see how that plays out and how far and wide we can see geothermal EGS systems implemented into the equation to see if we run into any of those issues with mineral rights.
Speaker 2:Yes, yep, for sure, and I'm sorry I was. It's okay, something else caught my attention and so I was. I was just right.
Speaker 1:Yeah, that's fantastic. That's fantastic. It's funny because I was just pulling up on my phone here a screenshot that I took yesterday and it was the article that you'd show he's showing me. Okay, there, it is Okay Because I read this article that Dave just shared. I was seeing it yesterday. I was like, oh my gosh, this is incredible, it's fantastic. I was going to actually text that to you to possibly cover it when I got into the studio today. Yeah, we see, telepathically, you received the message. I did, you brought it. I forgot about bringing it up, but that does a very relevant in real-time advancement, you guys. Yeah, yesterday, real-time advancement, you guys?
Speaker 2:I'm thinking about energy. I think Wayne's trying to connect, communicate with me right now.
Speaker 2:Let me go look and see what's going on. Yeah, I think it distracted me and I'm trying to understand this and I read about it earlier and I'm still. I'm a little bit lost in some of this, but I believe what this is is it's the world's first 8.5 kilowatt AI data center power supply. They're using different materials. This is going the other direction. They've achieved a 98% efficiency Kilowatt Kilowatt. So they're using AI-optimized 54-volt PSU compiles with Open Compute Project and Open Rack specifications utilizes high power. They're using gallium nitrate and combinations of materials to maybe help solve some of the massive needs. Say, well, maybe we can do this far more efficiently provided we get different materials involved.
Speaker 2:Again, what I love to see about this space is, while you have massive infrastructure being built, there's also demand and the market. You know the open market, the capital markets are saying, well, yes, but let's also go after this other side, which is like we're doing it today. Well, how can we make it better? Efficiency, more dance, more dance, yeah, and so you see a whole industry that's been in existence just because of batteries and everything else and because, you know, we've got all these cars and all the things we use. But now really ramping up and really trying to explore saying, okay, well, now that it's out there and the market's being established, and now we can talk about maybe grid-size storage or enterprise-size storage capacity, well, how can we push those frontiers?
Speaker 2:And I just love reading about this space. I mean, this is entrepreneurism, this is scientific discovery, this is pushing the boundaries of where we can go. And this is all in service of okay, we're going this direction. How can we make it better? How can we make it less expensive? How can we maybe completely say, oh yeah, we're using this today, but what if we did this? Or maybe right now there's some guy working on his postdoc going. You know, I think I figured this out and we can do it better, but I've got to test it and scale it and that might help us solve massive things that we're all faced right now, but we still got to be anyway. I just love reading about those things. It's kind of neat to see.
Speaker 1:That's an awesome final thought, man. We're at the top of the hour. I think we wrap it on that. Okay, it's very exciting. There's a lot to talk about with NVIDIA and some of these competitors coming up New chips, new racks, improved density, improved efficiency across the board. It's inevitable, right? This is the greatest capitalist nation on earth, so this is inevitable movement.
Speaker 2:Yes, and it's good to see again. That's the great thing. It's open wide and we see so many groups jumping in. Well, we talked this week a lot about how you cool these places and all the technologies that are out there and then some that haven't been really widely talked about that are coming about. How you deal with the massive heat problems. You know how you either leverage the heat for other things or how you mitigate the heat Just in that little, but it's a huge solve. So whoever solves it? Wow, yeah, and we already know, you know where everybody's trying to kind of position themselves to try and solve that. So you know it's just everywhere to kind of position themselves to try and solve that. So you know it's just Everywhere we look in this space. Yeah, there are a ton of, there are a ton of companies trying to solve a problem. Yep, you love it Absolutely, Okay. Well, thank you guys, Thanks everyone, until next time on the frontier line.
