Electric & Eclectic with Roger Atkins - LinkedIn Top Voice for EV

Storing Power, Powering Progress

• Roger Atkins

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What happens after we make the power? We dive into the messy, fascinating intersection of energy storage, AI-hungry data centers, and the EV market—where policy, pricing, and supply chains can accelerate progress or grind it to a halt. With Benchmark Mineral Intelligence's Head of Research, Iola Hughes, and Energy Storage Lead, Shan Tomouk, we unpack why batteries are quickly becoming the most flexible tool in the energy toolbox and how that changes decisions from the mine to the megawatt.

We explore the surge in US storage demand as utilities wrestle with aging grids and interconnection queues, and why developers are using containerized ESS as a bridge to get data centers online faster. You’ll hear how peak shaving and behind-the-meter batteries cut brutal 6 pm prices, how waste heat from servers can warm swimming pools and districts, and where SMRs fit on a realistic timeline. We chart the geopolitics too: the US lead in data centers and GPUs, China’s grip on LFP and processing, and the West’s push to localize parts of the battery supply chain.

We also test the sacred cows. Can vehicle-to-grid finally scale, or will dedicated storage dominate grid response? Is battery swapping dead for cars but a winner for heavy trucks, where standardized packs and depot cycles make economics sing? And what does a credible 2050 look like—more renewables, firm gas, smarter batteries, and microgrids that help emerging regions leapfrog old pathways?

If you care about clean energy, AI infrastructure, EV adoption, or how to actually pay for the future grid, this conversation gives you a grounded map and a few bold bets. Follow along, share with a friend who loves energy debates, and if it resonated, subscribe and leave a review so we can keep bringing sharp voices and real-world insights to your feed.

SPEAKER_00:

When we've made energy, what do we do with it?

SPEAKER_01:

Hello, and welcome to the Electric and Eclectic Podcast Show with Roger Atkins and some truly smart and amazingly interesting guests.

SPEAKER_00:

Iola Hughes and Shan Tomu.

SPEAKER_01:

Are you sitting comfortably? Then we'll begin.

SPEAKER_00:

Welcome everybody to the latest episode of Electric and Eclectic, the Electric and Eclectic Podcast Show, which hopefully delivers very much that. What's going on the world of electricity, what's going in the eclectic world. So that means where we are with mobility, where we are with energy, where we are with that marriage, if you like, of those two big parts of our lives, everybody's life, that have essentially been the same for a hundred years, uh hundred years or more, and are now radically changing like, well, like never before. So two of the best people you could possibly find in the world, and I'm not prone to hyperbole, but I'm telling you that's a fact, uh, are with me today for this podcast episode, head of research at um benchmark mineral intelligence, Iola Hughes, and Shan Tomuuk, who is battery energy storage and energy research uh head. So these are the folks that know their stuff, know what we're going to talk about, know the topic of what we're going to talk about today, which is when we've made energy, what do we do with it? And how do we do what we do with it and why? And what are the economics, the geopolitics, all of those things all together? So, welcome to you both. Um great to be sat here with you for, I don't know, 45 minutes, something like that. Um, so I can grill you. Uh so let's start off, if I can, maybe just give a quick intro. Um, Iola, if you'd like to start with, yeah, a bit of your background. How have you come to be here at Benchmark and and and why are you here in your mind?

SPEAKER_02:

Sure, thanks, Roger, and thanks for coming into the Benchmark office today. Um great to have you here, and always good to chat about the broader battery market and energy transition. We had the chance to go to a very exciting EV launch event just the other month. So um, yeah, good to see you again. Um so yeah, my name is Ayoda Hughes, head of research at Benchmark. Um my background, I I studied geophysics and then joined a company called Rowmotion um over about six years ago now. Uh Row Motion was acquired by Benchmark about a year and a half ago. Um essentially, Row Motion provided market research and data across the battery demand markets, so EVs, energy storage primarily, and then Benchmark sits more on the raw material side, battery raw materials specifically. And we've kind of come together now to form this mind to grid research house and price reporting agency.

SPEAKER_00:

Wow. Well, that's a that's a great intro. And uh yeah, fantastic. Shan, so um I don't want to offend anyone here, but we're not really talking about EV so much anymore. We're now talking about energy storage, battery energy storage systems. So that's your bag. Give us that sense in the same way that Iola did, please, in regard to um, you know, what's your background and why are you here? You know, wh why does this stuff float your boat?

SPEAKER_04:

Yeah, sure. So I came from more of the kind of economics background and I stumbled into a job as a commodity broker uh in uh battery metals. I remember thinking, what the hell are battery metals? And uh very quickly was sort of uh yeah, really, really enthusiastically interested in the the area. I don't think I was cut out to be a broker, but ended up going to the analysis side initially upstream and then uh moving to roadmotion, covering a bit more of the downstream and now working on the uh the battery energy storage along with Iola.

SPEAKER_00:

Yeah. Do you do you know what though? I I've I've got to say, Shan, stumbling into things is one of the best ways to do it.

SPEAKER_04:

Yeah, absolutely.

SPEAKER_00:

Because I think, well, when you do that, you don't necessarily have preconceived ideas, you come with an open mind. And uh I I stumble around, I've been stumbling around for years, and it's kind of worked. So I recommend it.

SPEAKER_04:

Yeah, it worked pretty well. I remember thinking, I don't know what this is, but it turns out to be one of the more interesting industries out of all the people I know that graduated in the same year.

SPEAKER_00:

So Yeah, well well, when you think about that, it is because in truth, energy is everything, isn't it? If you really, if you really sit down and think, energy is about food, it's about water, it's about you know civilization, it's about so many things that make the world work. And it always has done. It's become much more of a connected machine, if you like, in here now in the 21st century, but you know, go back to whatever century you like. Access to energy and the ability to cook, you know, keep warm, do other things progressively as time went on, um is fundamental to every single civilization. And so here we are today on this cusp of an AI revolution, on the cusp of an energy revolution in the switch from hydrocarbons to electrons. This is a profound moment in human history. Um so yeah, I'm with you. If if I were young again, I'm hopefully I would I'd be inclined to be doing what you're doing and be in this, being in the space that you're in. Um so so let's let's look, the the ambition of of this episode, I I wanted to help people, including myself, of course, get my head around what really is going on at the kind of as best we can granular level, um, the detailed level uh uh of this journey. And can I start then, and maybe start with you, Shan, in that if I'm in the electric vehicle camp and hopeful and believing that adoption rate is going to, you know, continue to be strong and we're gonna build all these batteries and all these people are gonna buy EVs, and then I hear all of them the focus on AI and data centers and energy storage, is that gonna derail the the EV revolution? Is it gonna steal away some of that battery capacity, do you think?

SPEAKER_04:

I don't think it's necessarily gonna derail things. I mean, ultimately they are separate markets to some extent, uh, and every market's gonna go through peaks and troughs. And the BV market is, I think it's fair to say, is going through a bit of a trough. Um, but it's the case with pretty much every market. It it'll eventually happen, I'm sure, on uh the AI and data center side, you know, if there is a bubble forming, uh, I'm sure we will see that that kind of peak and then that trough. So I don't necessarily think it's taking away or derailing things, but on the battery side, we've certainly seen a big push from battery makers who maybe have traditionally focused on the EV side, suddenly looking to ESS as if it's you know the golden child all of a sudden and they've been looking at it all along. We're we're sort of sort of the the cool kid on the block all of a sudden. It's uh quite nice for us.

SPEAKER_02:

Yeah, and it's it's pretty interesting like how how stark that is regionally. Um when we think about like the global picture of lithium-ion battery demand, you know, the vast majority of that is still EVs and will continue to be EVs. We're up to about 19% coming from the storage market, which has you know increased dramatically back in 2022. It was less than 10% of the market. However, when you drill into specific regions and particularly the US, where we've seen big pullbacks of EV ambitions, OEMs cancelling plans, policy really changing, the storage market there becomes a much more important, important kind of pit part of the battery picture. So next year we're looking at it accounting for over 40% of battery demand in the US. So suddenly that has huge implications for anyone who's making a strategic decision across the whole supply chain, whether they are a cell manufacturer, raw material player, um, it it does change the conversation a bit.

SPEAKER_00:

Yeah, and and so another thing that I want to try and get my head around is um traditionally we'd always talk about the grid. We'd talk about grid capability, uh grid resilience, uh grid connections, etc. We certainly do when it comes to the electric vehicle proposition in terms of charging. Whereas are we starting to see in the United States, with this hungry demand from data centers and the like, a much stronger focus on localized grids, microgrids, call them what you will, disconnecting from that national grid setup. Um and it is very complex uh in the United States and and it has got lots of challenges. But what what what can either of you say in in that regard? Um, yeah, what what's what's the picture looking like then?

SPEAKER_04:

Yeah, so I mean if we look at kind of the tech companies that are looking at building data centers, particularly in the US, where it's I think it's fair to say that the grid isn't necessarily the most modernized thing in the US. I don't want to take away from them because I mean it it's impressive to build a grid, particularly in the time they did um across the US. But I think it's fair to say that grid is aging slightly. And it makes it quite difficult to bring on all this new load. Something to note as well is that if you look at electricity consumption growth in the US over the past kind of hundred years, up until the last 20 to 30 years, it grew quite strongly as kind of we grew in consumption in the US. Uh and that was pretty solid growth up until about 2008, basically.

SPEAKER_02:

Yeah. Financial crisis. And then it just kind of flatlined.

SPEAKER_04:

Yeah, and then it flattened. And policy has really adapted to that flattening of consumption over the past few years when we look at things like support for generation, et cetera. And so when you look at the the recent picture of kind of generation growth and low growth, it has really adapted in that um kind of period.

SPEAKER_02:

Yeah, and I think the the key thing as well is it's not just data centers that are bringing the extra load. A lot of the policies that we've seen over the last year or so have been around onshoring of manufacturing. And all of these facilities require huge, you know, a gigafactory requires a huge amount of electricity. Um, any sort of electrification going on, whether that be EVs, heating, industrial applications, that all adds to that load picture as well. And then the data centers is kind of the cherry on top.

SPEAKER_04:

Like, yeah, exactly. I mean it's it's a huge push. And um but yeah, as we kind of discussed, um that is difficult for grid operators to provide the grid connections for those data centers to come online when they want to. And it will always kind of be that the preference of a data center to be grid connected, but that's not always going to happen. So what we are seeing, particularly as uh when we're talking about storage, is the ability to use ESS containers as a bridging technology until you get your grid connection up and running. So the best example in the US that we've seen that so far has been XAI using Tesla megapacks. Essentially, they installed uh about 600 gigawatt hours of megapacks for their Colossus 1 computer, and then another 620 to 30-ish for their Colossus 2. And that was basically as a bridging connection until their second uh 150 kilowatt grid connection was up and running. So that's a great application of storage to use that, and it's feeds into the sort of behind the meter and using your own generation and power supply to be able to get online as quick as possible, which is really their main concern, is to be able to compete and get ahead of the other competitors and be able to bring in their facility as quick as possible.

SPEAKER_00:

Yeah. You're going through a lot of things here, and I'm scribbling down notes because uh I don't want to miss anything, and I I'm I'm listening as as carefully as I as I can. Can I just go back a couple of minutes to something you were talking about there, Ayola? Um supply and demand. Who who is responsible for scoping demand taking into account these things? You referenced the post-2008, well, the post-2008 moment. Um so if you start to add in what looks like it's going to happen, a planned or suggested adoption of electric vehicles, um the AI thing, obviously, data center stuff, etc. What body creates that kind of map? I mean, do you do that as a business? Do you do you try and help scope what that is and then look at what the supply might be and then look at where is where is there a gap or or not?

SPEAKER_02:

Yeah, so not not something we we do um definitely to keep an eye on, but not something we do in-house. Um in general, it it's usually down to whatever local body is in that place. So in the UK, that would be something like the national good would look at. Um in the US, it's very much down to like utility companies. So they'll basically all set out their. So there was a good example of one recently, which was Duke Energy, which is a utility in the Carolinas. Um, they released their kind of plan for the next few years. Um, and within that, you know, they highlighted expectations around, I think it was 20 to 30 percent electricity growth uh in the US by 2030, um, which comes out as that kind of two to three percent every year, which brings us back to the kind of pre-2008 um growth story would have seen. And within that, they'll then as well look at you know how much solar they're expecting to come online, gas generators, and also they really kind of highlighted the potential of batteries and how they see them as part of their resources plan for the coming years. But it it is very localized to individual countries or individual states or or utilities, even.

SPEAKER_00:

And and and then, Shan, in in what you were explaining then, in regard to you know putting batteries in and having that kind of competitive focus, etc. What about the pricing delta? Um, which I guess is very different around the world between, you know, cheap energy at a certain point in time in the day or night and and expensive energy. Um where does that kick in? Where does that pricing delta opportunity sit from the point of view of arbitraging energy to good effect? Uh because I get a feeling in the UK there's a huge opportunity. Because it it's an extreme variance. Every 15 minutes there's this you know, ebb and flow of energy depending upon the wind, depending upon the solar, depending upon all these things. Um but in but in other countries that that there isn't the same pricing sort of scope. Um what can you say about that?

SPEAKER_04:

Yeah, so this is something we've been looking at. It presents a fairly good opportunity for data centers in that if you do have storage installed at your data center, then you're not just sort of a a leech on the grid, let's say you're able to engage with the grid. So uh and and that's why peak shaving is one of the kind of best uses for grids or for best at these sites. So, for example, in the UK, um, if you install BES at the grid connection with your data center, um you can it helps with your grid application because suddenly you're not just taking power, as I said, but you also you have the ability to absorb some of that excess wind energy when it's not necessarily being used. Uh, or even if you're not necessarily engaging with renewables on the grid, if you're a data center and you know prices are gonna be particularly high around 6 pm, you can allow your best to kick in during those peak hours to reduce your uh energy costs. And energy costs is a huge aspect for a data center, as I'm sure you can imagine. Yeah. So that is one of the kind of main ways we see. And also if you're not just necessarily kicking it in at 6 pm, but rather you're gonna reduce your entire peak demand and therefore um in a smaller grid connection or lower your demand charges, that's another use case.

SPEAKER_00:

Um Right. And another thought, partly that's been in my mind for a while, but listening to you both talk, sort of comes into it, is this fact that big data centers tr in using a lot of energy to run all the systems, etc., create a lot of heat. And you've got to manage that heat. Can they harvest that heat and turn it into energy? Is is there a way in which that can work? Because like in a combustion engine, okay, we we criticize it for its thermal inefficiency, you know, 30% thermally efficient, if you want to put it like that. But at least that, you know, is that waste heat, if you like, can be used in HVAC, can be used for certain parts of the vehicle. It doesn't make the wheels go around, but it does have some tangible benefit. Is there is there an equivalency with the heat triggered in data centers? I I don't know.

SPEAKER_04:

There's there's lots of different small ways in which data centers can try and increase their sustainability and their efficiency. Uh it really depends on the size of the data center and where it's located. But I know, for example, in Norway there are some data centers that are using their excess heat for kind of district heating for the local, local area.

SPEAKER_00:

Oh, right. Okay.

SPEAKER_04:

Um if you're somewhere in the US and you're building a massive gigawatt hyperscale cluster, that can be a little bit more difficult because um you don't necessarily want residential homes next to this massive data center that's humming all day. Uh but you could certainly make an argument that you could use it for heating for the area or use that heat for whatever other kind of thing.

SPEAKER_02:

There's a pretty interesting one in the the UK that I heard about where that you know they're using quite small data centers, but they're using them to heat swimming pools. So they're basically contacting kind of local councils and communities where there's kind of space nearby, building small data centres next to the swimming swimming pools. You can use that water for cooling of the equipment and then also um as as kind of heating for the pool.

SPEAKER_00:

Well, yeah, I mean, because there's there's the thing about life that's always interesting to consider is the yin and yan. There's always, you know, equal and opposite and all that stuff. I don't want to get into Einstein because I only know it was an old bloke with a beard who was very clever. I'm not I'm not that intellectual. But um, in the same way, as I say, that that combustion engine can harvest uh, you know, heat recovery and turn it into cooling as well. You know, HVAC, it's for heating and ventilation control. Um I would have thought that there surely is some opportunity where all this heat that's being triggered by all this energy that's being used by all these facilities, that that there is a there is a you know, there's a benign element to that. Um I just yeah, I'm I'm not quite sure. I think I know what I mean, but in in my questioning. But I just kind of think nature i i is so good at not wasting anything in the 21st century as we become more sophisticated and more demanding of a good utilization of of energy and good efficiency, that that is there something to be had in all of this heat that's abounding in the state.

SPEAKER_02:

I think the the distributed heating one is is really interesting. And I I I think I just earlier today actually I saw a similar project in Denmark um where they're doing the same thing using that excess heat to you know heat the community, which is a yeah, win-win, basically.

SPEAKER_00:

Yeah. Nothing wrong with a win-win. Yeah, unless you're playing a game of football, and then that's basically a draw, isn't it? Um now, uh a subject which um I know absolutely nothing about, other than I was very intrigued recently to hear the news that Rolls-Royce are going to be developing, what's it called now? I must get the acronym right, um, SMR, small modular reactor. I'm intrigued that the it's just SMR, the N-word doesn't appear in there, nuclear doesn't appear in there. Um and uh it's a kind of early stage stuff. I think they're only, from what I could gather, a couple of these in operation around the world. But you keep hearing people, especially the big tech companies, saying, Oh, we've got a whole suite of options in front of us. One of them will be SMRs, not battery-related energy stuff. Um is is that where do you see that? That appearing on the landscape. Is it that that's more next decade and stuff? Is it Shan? What can you say on that?

SPEAKER_04:

Yeah. I mean the US is certainly trying to open various different ways for powering, particularly data centers that are maybe not the renewable side of thing, which I think it's pretty clear that this administration has not wanted to go down that route. But anything nuclear is generally quite long-term, but data centers are often looking long-term. These projects are massive, and they're exploring many, many different ways to power them. That's been the general consensus we've seen from data center companies. It's they're very much at a point where they know they're going to need to find power from some somewhere and to be able to manage these issues. But they're very kind of still in the stage of figuring out what's going to work best. And it will likely be a case of even the same data center company or tech company will use multiple different approaches to power their data centers depending on the area. So if you're in the maybe southwest of the US, you're going to have a lot of solar. If you're in Virginia, you've got your grid connections capacities. Well, it was fairly strong. It was a good hot pocket of areas, but um you know that becomes more and more difficult over time. But nuclear is certainly one that some data centers are looking at. It just takes a long time and uh it costs a lot of money.

SPEAKER_02:

I think that's the cost thing is the big point, right? Like, you know, right now when you're looking at kind of your portfolio of technologies, you could roll out quickly and afford affordably. Um you know, SMRs are still a lot kind of longer timeline and they're going to be very expensive. But you know, 20 2030s, 2040s, 2050s, and beyond, they could certainly become a kind of key technology.

SPEAKER_00:

It's one to watch. Is that where you the box you put that on in? One to watch. Um now, here's the thing that is uh you'll like this, it's good news. Um, you've alluded to it earlier on, I think both of you actually. Um uh the United States of America has more data centers than anywhere else in the world. Now, how that aggregates in terms of how big they are, you know, and how that assembles into overall stuff, I I I can't quite remember from some of the material you you've you've published. Um, but it's not a story of China's in the lead. China's in the lead in almost, it seems, everything else. So one thing that intrigues me is how has this come about? How come China hasn't already overtaken the United States and other places in the world? Is it about to? Or kind of what what's what's the backstory to that, Shan? Could do you Do you have a feel for that? Because it's it's it's not like it is for everything else.

SPEAKER_04:

Yeah, it's uh it's down to the fact that most of the big tech companies that dominate the world are in the US in California. And data centers historically have been used mainly for things like cloud computing and storage, which is pretty much developed in the US by the four or five big companies. So they've always had a big foothold in the US. And I would imagine China never really necessarily cared about as much before AI. That is changing. Uh, we have seen China say they want to start building their own models and have their own data centers. The US does have a massive lead in this, and they're looking to double down on that lead. And we've seen kind of from the administration a lot of focus on retaining that superiority. And we've seen things like uh Nvidia not being able to ship the latest chips to China and older, only older generation chips, and uh Chinese companies are trying to crack the making their own chips. So there's a lot of different dynamics there, but it really is just down to a case of the US has always been the lead there and been developing through their tech companies.

SPEAKER_00:

Yeah, that's where things get interesting, because I may get this wrong, but is it TSMC in Taiwan is the kind of big player, really the big dog when it comes to chips around the world, is that right? Yeah, NVIDIA, of course.

SPEAKER_04:

Yeah, I mean for AI chips and and like the GPUs, Nvidia really dominates there. Google have their own uh kind of GPU, which is the well they call it a TPU which is their own in-house, and I believe Amazon have just unveiled their own version just the other day. Um so yeah, NVIDIA really is the dominating player there. Everyone tends to go to them for their for their infrastructure.

SPEAKER_00:

I got introduced once to Jensen Wang years and years ago. I was in Berlin at a a GPU conference. I didn't even know what GPU stood for. I can't remember how I got to be there. Anyway, I was uh stood talking to um and I hope I'm not being impolite saying this, to a bunch of geeks who were all like looking down at their shoes. You know, there was no eye contact. There was no, you know, I was kind of a bit of a fish out of water there, really. Um anyway, um, yeah, they would they were sort of chatting and I was telling them what I was doing, and they were absolutely totally disinterested in what I was doing and electric vehicles and you know, no engagement really at all. Uh, but they had nice shoes on, to be fair. Anyway, um, one of them suddenly said, uh, you know, can you code? And and uh I said, Well, uh, haven't coded for a while, but when I was at school, we used to, we we had a uh a class, after school class, where we could go and do coding, and it was COBOL and Fortran uh language. And they all looked up from their shoes and said, Oh my god, that's that's amazing. Just at that moment, Jensen Huang came in the room and the guys beckoned him over and said, This old guy can code in Fortran and COBOL. And I then had a conversation with Jensen about electric vehicles, driverless vehicle technology, you know, being able to what he'd then been presenting up on stage, you know, uh working on vehicles in terms of research and development at different places around the world with shared teams all connected with this, you know, uh uh stuff that that they were showing. Um yeah, so so um So you bought lots of NVIDIA stock. Well, there's the thing. Do you know what? For as much as I'd like to think I'm clever, I'm really stupid. Because over the years, I've had I had that moment with um with with Jensen Zwang. I got to understand a lot more about GPUs and all that stuff, and this is a good number of years ago now. Um uh bumped into Elon Musk a couple of times in the past. I've helped people, you know, my own sort of clients in terms of doing the work that I did more of in the past, not so much now, but advisory work, consult consulting work. Uh and almost without exception, I've always recommended to people that they, you know, invested in Tesla. I don't have, for the record, any qualification or license to say that to you now. So if you're watching and do not take any advice, and I'm not giving it on Tesla either way. But again, to your point, over the years and BYD. Ten years ago, I was at an event. Um, it was Bank of America Merrill Lynch. And one of the questions asked from the floor was, Who did I think was, you know, Mr. Atkins, you're involved in this stuff. Who do you think is the big dog when it comes to EVs? And I said, Well, everybody knows who that is. You know, pause for effect. I said, it's BYD. Um, I think I said that at the time because Warren Buffett had recently invested, so I wasn't, you know, you went ahead and no, not really. Um and um because it was in China, and I thought China will have the ability to scale up faster and all the other stuff. Um, but that's all another story. Let's go back to the focus here on what we're talking about. Um so when it now comes down to supply chains, you chronicle forensically where we are with the critical mineral supply chain for all of this. You know, no supply chain, no batteries. You know, no batteries, no energy storage, whether it's that or EVs or whatever. Um do either of you see any signs of that starting to change, that dominance of Asia, particularly China? You know, when it comes to either new processes with you know the processing side of the minerals, you know, geology is what it is. You know, the the the graphite mines are in Brazil and Madagascar, for example, and so on and so forth. But but is there any sense that you have of um an ability for the rest of the world to I wouldn't necessarily use the phrase catch up, but you know, get going is maybe a more realistic turn of phrase.

SPEAKER_02:

Yeah, so the the US is probably um doing the most from the policy front to make this happen. So um, particularly on the storage side, you're looking at kind of sourcing requirements for coming in from next year and also similar sourcing requirements coming in for those making batteries in the US from next year. And you know, if you look through the supply chain for energy storage right now, because the chemistry of choice is LFP compared to the the EV market where you have a bit more of that mix, the LFP supply chain is very heavily dominated by China from the cathode, the anode through the cell as well. But in the US, because of these these changes in policy, we are seeing more investment coming through, particularly on the cell side for now. Um cathode as well. We've seen some some quite big headline figures. There was the the Japanese investment into to Mitricam who are developing LFP cathode in in the US, which is pretty significant. Um in the European market. There's definitely, I guess, a bit more of an openness to Chinese cell manufacturers, cathode manufacturers being here. Um so yeah, a bit of a bit of a diverse mix. In general, the the Chinese dominance is I'd say pretty much here to stay for as we see it right now.

SPEAKER_00:

Fascinating. I don't want to drift off too much into EV, but it I'm naturally inclined to that. So, you know, Shan, I know we were going to talk specifically about Bez, but but we're recording this now December the third. Now, on December the 10th, there's going to be an announcement from the European Commission after considerable review, slash lobbying, slash whatever you want to word you want to use, on where we are with the 2035 um cessation of uh internal combustion engine manufacture. Um if they push that back, whatever phrase people want to use, you know, uh uh take a consideration that, well, they're not doing that in China. They haven't got a mandate in China for this, so so we're only equalizing the the story. Um they'll use whatever phrase or turn of phrase to make it palatable, whatever the decision. Um if it is that they Yeah, to use the parlance that most people in my world will use, kick the can down the road, how will that impact the whole world of mining, mineral processing, investment, so on? Will will it be a jar? Will it be a spanner in the works?

SPEAKER_02:

I I wouldn't say so. Um I think the European market's in a pretty interesting position now where you are, you know, the kind of acceptance of EVs is much broader than say in the US. Um There's an interesting kind of dynamic occurring as well where you have you know, for example, Germany, they are pushing back against the 2035 target, but at the same time, they are increasing their EV subsidies for next year. Spain just came out today uh with a huge package of subsidies for EVs, France, new EV subsidies, the UK, you know, strong ZEV mandate. So the the policy beyond the 2035 target is very strong. There's a lot of investment going on to charging within Europe. I think you know, when we look at our forecasts, we never expected 100% EVs in 2035.

SPEAKER_03:

Right.

SPEAKER_02:

It was always some expression there would be workarounds. The reality is that you know that if the rules are softened, it's not like it's not like they're gonna be softened like in the US, where you know you you go you flip-flop from basically 100% EVs to zero EVs in in the space of of administration. The rules will just bring in some flexibility, you know, the use of things like biofuels, um, small allowances of internal combustion engines anyway, in some way, but the reality is that Europe is is very much on this pathway to electrification, and there's a lot of support mechanisms outside of that, you know, very forceful 100% target.

SPEAKER_00:

Very interesting answer. Yeah. Um I didn't know that about Spain today, though. I'll have to look that up. Um, and hypothetically, if the Commission say we're going to give it another 10 years, but that's it then. Oh, you know, we're not mucking about now. This is you know, it's almost like the boy who cried wolf story, isn't it? But if they did, do you think it's almost then inevitable and essential then that the UK government just say the same thing? Because we're not in the EU now.

SPEAKER_02:

I know everybody would like to talk about that anymore. But I mean the the UK targets are already kind of more ambitious than than some of the European ones. Um I think it just depends who's in power. Um probably the current government wouldn't change the rules. Next election, the rules could change.

SPEAKER_00:

Ooh. Now, Shan, I'm gonna come back to you because something's always in my mind, I kind of might have referenced it earlier on, I can't remember now. Was can the EV fleet, the global EV fleet, or in a particular country, start to become part of the energy storage system by way of mass adoption, scale up of the long-heralded but seemingly still not arrived at scale, um, bi-directional charging mechanism. And just for anyone uh listening or what watching um isn't familiar with that, it's simply the ability of the battery in your EV at moments when it's convenient and works for you to push energy out from that battery into both your home, vehicle to home, V to H, or vehicle to grid, back into the energy system. Do you at any point envisage that being a big thing, Shan?

SPEAKER_04:

Yeah, I think down the road when you have a particularly large EV fleet, um, there certainly is an argument that if you kind of yeah, group them together, they have the ability to interact with the grid. And we've already kind of seen it in some countries, in the UK, for example, Octopus Energy have their tariff. The key thing there is really they cover a lot of the costs with the the bidirectional charger, which is really key, because those charges are more expensive than a typical home charger. And so it can be quite, you know, without that, it can be quite difficult to justify the cost to the consumer. And that's ultimately where it has to make sense. Um, if people are going to have their cars plugged in overnight, constantly cycling, they want to know that you know they're making at least a little bit of money from it. Um I guess the there's a few difficulties, and as you kind of say long-heralded, I think typically um the auto industry and the the power industry haven't necessarily worked together. So a lot of their protocols don't really mesh. And that's been a big challenge. Uh the other kind of big challenge is just having a large enough fleet to make a dent in the grid, uh, particularly when we have storage projects coming online that are sort of much larger and dedicated to uh grid response. So from kind of speaking to people, it seems that it's a great asset to have on the grid. It might not be the go-to for a grid operator to use in a situation, but it's always a good add-on to have.

SPEAKER_02:

Um Yeah, an interesting, interesting use case for bidirectional charging that heard from kind of more on the OEM side is you know, before vehicles are are sold, they're often sat in quite a large parking lot for some time, could be, could be weeks, could be a couple of months before they go off to the the various dealerships. And that's a constant churn of new vehicles kind of entering that parking lot and leaving it. Having that parking lot almost kind of set up as a one large stationary battery. And the reality is you're only going to cycle it a few times, you know, in the in the month they're there, and it's not constant cycling, is quite an interesting use case.

SPEAKER_00:

Oh, do you do you know what? Both of you talking in this fashion, um I can't help it, but it brings into mind a few of my pet pet things. Um wireless charging and battery swapping. Um, if you had ubiquitous wireless charging and a much more easy use case for hooking on, and you know, bidirectionally charging wirelessly, by the way, because you can do that. Um and also the battery swap thing. I think the battery swap proposition has always been seen as uh it's simply a convenience thing, you know, and all the while you see the increase in speed of charging, you think, well, what's the point of battery swap then? But it misses the point that this isn't about just that, that's part of it, but it's predominantly, and I've been and around this bit for a while, so I'm not trying to be pompous, and you guys know stuff better than me in detail. But I can't help thinking that at some point the whole battery swap thing becomes part of the energy storage system because then the batteries aren't owned by individuals. Because, for example, you just mentioned Octopus and BYD and Zaptech. Uh unless I'm wrong, they're not selling the car, they're leasing the car. So the consumer never owns the battery. So who owns the battery? BYD or Octopus or whatever. So the value chain of how they're going to use that battery in and out of the energy system is going to be to their value or challenge or risk, whatever you want to call it. Um and again, knowing a bit about battery swap, if you look at how that's unfolding at pace and at scale in China and is connected, inexorably connected to the energy system, China State Grid and China Southern Grid, that story of battery swap is more about energy management and batteries than ever it is about convenience. So I wonder if we're going to see either or both of those capabilities, wireless and swap, come to the fore. You've been tracking this, both of you, you know, in one way or another for some time. Um I'm an old person. You know, I can go back to 2007, Shire Gas is better place, etc. Wireless charging, now you see Porsche showing that at um at the IAA a few months ago, September in Munich. And you saw BMW and Volkswagen showing the proposition of bidirectional charging. Add to that, the German government recently made a big change in how this is how the system works financially, etc. So it's a very long question, really. It's more What's going to happen next? What do you both think?

SPEAKER_04:

Yeah, I mean, it it like you mentioned, it's a completely different question if we're talking leasing. Suddenly people don't necessarily care about the health of their battery because it's not their battery, as you say. I think perhaps on the on the battery swapping side, we saw guys like Neo try to make a dent in the European market, battery swapping off the back of the success in the Chinese market. I would struggle to see a Europe or a US invest in the infrastructure you'd need for battery swapping, having already spent billions on fast-charging infrastructure. My point. Particularly on an industry that isn't I mean, is still growing, but particularly in the US, hasn't necessarily caught um, you know, the same love as as we might have hoped. Yeah. Um but I I I think it's the same thing with like hydrogen. Uh, when people talked about hydrogen trucking, for example, versus batteries, and people said, Oh, there'll be a mix of both. And it's like, I always was very skeptical of that just from the infrastructure side. I just Can't imagine them spending all that money on charging on the particular high-speed DC charging, but also supporting another completely different method.

SPEAKER_00:

That's a good point, Iola. Yeah.

SPEAKER_02:

So just in China, we are seeing quite a lot of heavy-duty trucks that that are battery swapping. And one of the key reasons that that is feasible is because there's much more kind of, I guess, collaboration among OEMs. They all use a CATL kind of battery swapping system, and the vehicles are designed around that. I think the idea of getting all of the European OEMs to agree on their model lineups is pretty far-fetched. So that that I think is a barrier beyond the Chinese market, is the collaboration and also just the development timelines for vehicles is so much longer.

SPEAKER_00:

Wow. Both of your answers there, and I'm not making this up. When Shan explained that and said we've got all this infrastructure in place, so where are we going to supersede that? And as he's saying it, I'm thinking, yeah, for cars, for cars. You know, we could include vans, perhaps in that as well, but but not for trucks. And then you said what you said. Because it it it does feel to me that if you just get back to the basics of any transition, it's got to be sustainable in terms of profitability, you know, CapEx and OPEX, you know, for someone somewhere. And if it isn't, it ain't gonna happen. You know, it can be grand ambition, you know, all that stuff. So in referencing battery swap for trucks, I think that's where there is a sweet spot. Uh because I think that that's where when you look at the challenge of rolling out megawatt charging, um, it works. We're seeing it being done by people, but trying to scale it up at the same time now we've got Islock going at the whole battery energy storage system and you know, data centers and all that sort of stuff, you you kind of think something's got to give here. And if you can have a battery swap proposition which can manage the energy in and out better, um more not just technically more f feasibly, but economically as well. That's got to be the fundamental. Um yeah, and and and the big question you you kind of you you posed it was can we get the your the established European OEMs, we're talking Volvo, Scania, you know, Mercedes, etc. Can can would they countenance having you know a battery pack as a common thing? Um because that was always the thing against cars and and battery swap with the original ambition of Shy Gassi. You know, all the OEMs were like, well, no, if the last vestige of individuality is our battery, you know, go away. You know, we we don't want we don't want a common one. But um yeah, I can't help I just have a sense that battery swap for trucks is gonna be the sweet spot.

SPEAKER_02:

Could be, could be. I mean, uh in China I think it's about half of half of trucks that are sold now have battery swap capabilities.

SPEAKER_03:

Wow.

SPEAKER_02:

And uh yeah, heavy-duty trucks in China sales have been flying this year, um really doing very well.

SPEAKER_00:

So just uh quickly on that for a moment then. Um in the same way that they have superseded, dominated now are giving us a huge challenge with you know well-priced electric cars, electric vehicles. Um what how how's that looking in that challenge and you know competition looking then in in trucking? Uh uh are we going fast enough in Europe? Are are the big players in Europe, you know, Renault and all the others getting on with it? They and they are, aren't they? They seem to be.

SPEAKER_02:

I think there's there's definitely progress happening. Um and the interesting thing with with any sort of uh kind of commercial vehicle um electrification is the the cost obviously moves away from the consumer and it becomes pure, you know, side-by-side economics of which vehicle is gonna save me more money as a business.

SPEAKER_03:

Right.

SPEAKER_02:

Um, so that is always gonna be the key decision maker. And you know, I don't think right now we're quite at a cost parity. Um maybe on lifetime costs, that's that's when you start to see those improvements coming through. Yeah, sales are still, I'd say, relatively low.

SPEAKER_04:

But yeah, interestingly, in uh in Volvo groups uh quarterly uh financial earnings, you can have a look through their numbers and they actually publish the number of uh deliveries for electrified trucks. And then within that they split out how many Volvo and how many with are within the Chinese sub brand, and the vast majority are with within the Chinese sub brand. Right. Uh so yeah, it's probably like highlighting. I mean, Europe is a little bit slower to grow in general compared to China, where it's just hundred, hundred miles an hour and everything. Um but yeah.

SPEAKER_02:

Buses, however, electrified buses are you know doing very well.

SPEAKER_00:

And I've I'm glad you brought those up because it seems to me I cannot fathom why we haven't seen globally a mass adoption of electric buses. The things that operate in situ to human beings and the issue with air quality and and stuff, and the fact that if you get them at scale, you can then have that cost you know, cost parity proposition. Um Campex SnopEx. In London, they've had a good go at it, and you know, a trying, let's be fair. Um, and in certain other cities, but you know, you then take the kind of the outlier of all of it all, Shenzhen, you know, all the buses and all the taxis are electric. Well, yeah, they would be because BYD's there. So, you know, you can you can see some of this in terms of how it all works. But let's wrap up if we can. We could talk about a lot a lot more stuff. Um, imagine it's I'm gonna put a challenge to you both. I'd like to ask, answer individually. It's 2050, okay? So 25 years hence, uh, or 24 years hence, um almost. Um let me think. Would I still be here? Would I be dead? Um well, probably close to death. But anyway, um what's the world going to look like when it comes to the energy system? And anything else you want to say about the world in 2050, from what you're tracking and and seeing? You you go first, Ayala.

SPEAKER_02:

Um I think we'll still have a good mix of different types of energy generation. Um I don't think that anything is necessarily gonna go away. Maybe maybe maybe not too much coal. Maybe that'll be largely gone. But I think we'll still see a bit of everything being being used. Um European market could be in a much more kind of renewable state than than some other areas, but um yeah, that would be the case. And then I think as well, we'll have seen places like you know, India, Africa really kind of make movements to almost kind of leapfrog a lot of you know tech technology or kind of the typical pathways that we did see in the European US markets. Um, things like microgrids really kind of popping up and a much more kind of distributed electricity network globally.

SPEAKER_00:

Right. Right. Well, you know, where wherever I'll be in a nursing home or something. I'll I'll look out for all of that. I'll come back and find you and and reconcile this. Uh Shan, what what's your sense of 2050?

SPEAKER_04:

Yeah, I mean, initially to echo what Ayala said about the mix of generation, it's gonna be very difficult to completely remove the natural gases, for example. I mean, the the more renewables you have on the grid, uh, or the or the more you rely on it for base load, the more you need to actually get to that base load number, if that makes sense. It's sort of exponential. So we're always gonna need the natural gases into the long term. Again, hopefully less less of the coal side. Um I would imagine uh I think batteries are gonna be quite key in unlocking the efficiency of generation we already have. And that's something we've already kind of seen the US government allude to, the fact that we do have this generation, but it we could use it more efficiently through batteries. So I think that's really gonna be the case is yes, we need all this new power. Uh it's gonna be expensive if we you know just bring on new generation for all of it. So, how can we use what we've already got and and what we build in the future and just use it far more efficiently than we have done as a society in in the past?

SPEAKER_00:

Right.

SPEAKER_02:

Maybe some flying calls.

SPEAKER_00:

Yeah, well, yeah, yeah, you've got to chuck a few things in like that. I mean, it it is what I think, but then I'm I'm not as I'm not as attached to data and trends as as you guys are, but and and this is probably fantasy thinking, but I think we'll have ubiquitous cheap energy because we will connect up the world through energy grids, you know, transatlantic, transcontinental energy cables, that essentially mean that because the sun is always shining on some part of the earth, that solar in particular is the dominant player, maybe in 25 years not quite the overall player, but it's eventually it will be. It will be everything. Um and the system running through artificial intelligence and other smart ways of chucking that energy all around the planet as it's made and used, perhaps might not even need energy storage anymore. And so we've got just in time energy, so to speak. I think that will happen. Um yeah, maybe I'm I'm getting carried away saying 25 years since. The other thing I think would happen, I hope, is that we will find a way to make geothermal energy cheap enough to work. You know, it works now, but you know, the economics just don't stack up. But given the Earth's core, there is so much heat and energy inside the earth that that that, and then the final bit, and I'm really now getting carried away, but you know, it it's it's it's what I do space, getting energy from space, having things, because I must have it's not my idea.

SPEAKER_02:

Elon said uh data centers in space.

SPEAKER_00:

Yeah, I I read something, so it may have been that, uh Ayola, but something where because I had a friend years ago who um uh oh what's a company called in Iceland, his name's Gisley Gislassen, um, Northern Lights Energy. And when I spoke to him, I said, is it Northern Lights Energy? Are you gonna capture energy from the Aurora Borealis or something? He said, I might do. I mean, they're crazy Icelandics. And I said, Um, yeah, well, I sort of thought that's what you'd call the company for, Northern Lights. You're gonna find a way of like having some sort of netting up in space that kind of you know beamed energy down on.

SPEAKER_02:

Shands off to Norway next week so you can see if he can capture.

SPEAKER_00:

Yeah, no, this is in Iceland. Well, yeah, still got the the aurora up there. Yeah, Vikings. Yeah, we're talking about the Vikings. Um but but yeah, I I I I I I'd like to think it would be something that we're not really talking about and thinking about. I'm sure. And and the other, just to finish, and I'm sorry banging on about it, but when I say ubiquitous cheap energy, if we can find as human beings a system in which everybody has equal access to cheap energy, we will help in a much more tangible and easier way the poverty issue, the as and them issue, the whole sort of thing. Because if you look around in society and the structure of economics, one of the biggest components in inflation is the cost of energy. If you strip that out, you you know, and and and inflation is a tax on the poor, in you know, many other ways of describing it. And and I think if we can extract energy as as that that bit and make it easy and cheap for everybody, you know, now if I really wanted to sound a bit bonkers, you know, free energy, you know, then yeah, that really changes the world. But that's me getting completely carried away. I think you have a lot more optimism in people than I do. Yeah, for sure. Well, in a funny kind of way, the older you get, well, the older I've got, and especially now having grandchildren, I need to be optimistic. I I don't want to shuffle off at some point where I've felt a sense of dread of the future. You know, I I I want to imbue, certainly as my little grandchildren who are just babies now, I've got three now, by the way, got a new one today. Can I just tell you that?

SPEAKER_03:

No, congrats. Congratulations, yeah.

SPEAKER_00:

No, I'm I'm I'm thrilled. Um, yeah, I I I I want to be on to optimistic for them and I I want to hope that uh despite what so much of the world feels like today, that things can and will go in a good direction for everybody. Um and we we don't we don't go down the toilet, if you know good way to think. Yeah. So um well look, thank you for being my guests. I've really enjoyed it. Uh hope I've inevitably spoken too much, but what you have shared with us and what you have said has been very interesting, and I know it's anchored in data and it's anchored in you know real stuff because that's the modus operandi of your your of your company, of course. Um so I hope you've enjoyed it too. Um please, if you get chance, uh um let's have a comment or anything like that, any kind of feedback. But you don't have to if you're too busy. I'm I'm not if you haven't got time to like and share, don't worry about it. But um in the meantime, yeah, thank you for listening or watching, and good luck and whatever you're doing. And let's all be hopeful and optimistic for the future. Thank you and goodbye.

SPEAKER_01:

Thanks for listening to the show. Thanks. And make sure you follow Roger on LinkedIn, where you'll discover almost all there is to know about the spectacular electric vehicle revolution.

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Roger Atkins

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