SPEAKER_03 0:00

People would build generating stations and then just run wires to their customers. So you'd have a a telephone pole with, you know, dozens, if not hundreds of wires. And to get away from that and to uh enhance the economic output for the country as a whole, uh, the utility structure was created originally in in Chicago. And so instead of having you know hundreds of wires on a pole, you'd have one. And that would feed every single house or every single farm or every single factory on that same line. Our ability to create utilities and to regulate them back at that time in particular when we needed to invest and grow, both how much generation we had and where we were where we were delivering power was really instrumental in allowing the grid to become as complex as it is today.

SPEAKER_00 0:50

The world of energy and the technology shaping it. I'm Josh Tate, and this is Between Two Turbines. Alan, welcome back to the show. I'm glad to be back. Yeah. Well, today what I wanted to do was take kind of a brief history of how we got here, how the grid um became the grid, the way we know it now. It seems like a lot of things are marked by uh, you know, problems along the way, and it's solving those problems. And and now we're at a very complex system. I've heard some people say it's the largest machine in the entire world. Largest and most complex. Yeah. And so I think, especially for me, um, and and for NACE and for people related to NASE, there's a lot to kind of understand. I wanted to talk through in broad strokes where we came from, where we're at today. And so going back, you know, way back in time, we're talking Thomas Edison, Nicola Tesla, and you know, back in the day, we we really didn't understand the possibilities. And and I almost think if they could see where we're at now, they may think it's utopian in a lot of ways. And um just light uh, you know, in and of itself was such a big problem. We lived in darkness for most of human history, and now we can get a light anywhere.

SPEAKER_04 2:29

Yep.

SPEAKER_00 2:29

And so going back to you know, those early days, um, that first generating station in in New York City, uh, it only powered 85 people. Yep. And it was on DC power. So starting out, I mean, I'd I'd like to hear your commentary on on where we were at on the DC AC side. There was kind of this war going on. And and and so yeah, Edison, more of a businessman than than Tesla. It seems like he was more focused on the physics, the science of it. Yep. So yeah, what are your thoughts there?

SPEAKER_03 3:04

Yeah, I mean, that those, you know, back in the late 1800s when when um kind of we started with with central generating plants were an interesting time. And one of the things I think about a lot is that, you know, of course, Edison had the first one, that Pearl Street station, which I think you alluded to, um, and it powered 80 homes and proof of concept. And he just ran wires to those homes. So uh there were some telephone or telegraph poles at the time, and he just put wires on those and ran them to his customers. Yeah. And then as other folks saw, hey, that's a way I could make money, they built their plants and then ran wires to their customers' homes.

SPEAKER_00 3:47

Yeah. So like London, Chicago, some of these bigger cities, but still it was just the city center. Yeah. Um, maybe kind of the elite class that that got access to it or some of these businesses like JP Morgan, some of some of these others. We've come a long way.

SPEAKER_04 4:02

Yeah.

SPEAKER_00 4:02

It scaled up and and you look at uh the uh Chicago World's Fair, there's kind of the first place that I think Westinghouse and Tesla kind of um showed out really. Yeah. And and looking back at some of these old images, you can see them. It's it's like it looks modern in a in a sense, but you know, it's the 1800s. And I I could imagine what I've heard is some reports people would weep when they got there is they've just never seen um, you know, such a large area just being fully lit. Fully lit, yes. And I think when we think about electricity, um, initially the the first thought was light.

SPEAKER_04 4:40

Yeah.

SPEAKER_00 4:40

How do we get light? How do we become productive in dark hours? Yep. And so it's it's changed our civilization dramatically. I mean, yeah, um, you know, not only with modern tech, but just the ability to write and and do things by candlelight, you'd have to have the money to, you know, for gas lamps or for candles, et cetera. But now, you know, especially with like LEDs, we're not using that much electricity to to get this light that's um such a major utility to us. Yep. Do you have thoughts about that?

SPEAKER_03 5:11

Yeah, I mean, the the world would not be the what the world is today without electricity. And and certainly, you know, our country went through significant investment um kind of from the early 1900s, you know, through the 1940s to get electricity all across the country. Um there was a rural electrification effort in the 30s that um uh allowed us to bring power into the non-city centers. And um of course it was a public works type project, uh, and it was you know started during the Great Depression when we we needed to find jobs for for people. Um, but it was also uh I think very wise of our policymakers at the time to make that investment um and to create the opportunity for power to be all uh across the US. And you know, one of the interesting things I think about is is the utility structure that that uh was created. I was mentioning earlier that people would build generating stations and then just run wires to their customers. So you'd have a a telephone pole with you know dozens, if not hundreds of wires. And to get away from that and to uh enhance the economic output for the country as a whole, uh the utility structure was created originally in in Chicago. And and so what that allowed for was a utility would have a monopoly in a certain geographical region, but they'd have a capped amount of profit that they could make. And so instead of having you know hundreds of poles on a or hundreds of wires on a pole, you'd have one, and that would feed every single house or every single farm or every single factory on that same line. And so um that uh our ability to create utilities and to regulate them back at that time in particular when we needed to invest and grow, um uh both how much generation we had and where we were where were we delivering power was really instrumental in allowing the grid to become as complex as it is today.

SPEAKER_00 7:28

Yeah. And a lot of, you know, at the time these were all separate, you know, generating stations. They didn't have an idea of actually interconnecting any of this. Yep. And from my understanding, a lot of from the 30s, 40s, those transmission lines we still are using. Yes. That's pretty amazing. Yeah, it it's amazing and also a little scary. Yeah.

SPEAKER_03 7:50

Um, you know, some of those lines, um, you know, they need to be upgraded. We've had issues uh particularly in in the West with forest fires with some of the let's call them hundred-year-old, eighty-year-old lines that uh despite best efforts, haven't maybe been as maintained as well as they could have been. Um and so, you know, we did that investment then, but there's probably more investment that we need to do to to both upgrade the grid today and to enhance it. Um because you know, we need a lot more energy now than we ever have, and just leveraging those those old lines built, you know, between the 1930s and let's call it the 1970s isn't gonna get us where we need to be.

SPEAKER_00 8:39

Yeah. And it it seems like a lot of it was just we were solving problems as we went. Yep. And, you know, kind of going back to that era, Tesla, Westinghouse working together, really showing that AC as a proof of concept was gonna work. Yep. And it made sense as the um major way to transmit energy, yep, um, electricity around, you know, the United States and beyond. Yeah. And from there, they they made this uh first generating station, Niagara Falls, a like 11 megawatts. Huge. Um and even they I saw they they uh advertised it as 15,000 uh horsepower. Yep. And so um, you know, which you know, you look at some of these modern um, you know, hydroelectric like in in China, what is it, 23,000 megawatts, something like that. Exactly, yeah. So it's it pales in comparison, but it was this proof of concept, and they said, um, and this was all privately invested. Funded. It was not even the government wasn't ready to invest in that. And so this project was that proof of concept, and and from there it just the the station started to pro proliferate around the country. Yep. And yeah, I mean, that that process of of connecting the grid, um, you know, we started realizing we needed these turbines to be spinning at the same rate. Yep. Um tell tell me about some of that stuff.

SPEAKER_03 10:03

Yeah, I mean that so in those early days, let's call them early 1900s up through the the 40s, um, you know, the there wasn't really power systems as a as a uh course of study didn't really exist. And so a lot of the the learnings came out of industrial applications where they would have a lot of motors on a site and and they would see frequency imbalances or other things that were happening within uh the factory itself. And we took those learnings and said, okay, what if you spread that across a geographical area that's got a hundred generators and ten thousand uh interconnection points and and that kind of stuff, and that's a lot of where the theory around power systems came from. And so there, you know, some of the the there's physical geographical challenges, you know, our are we call it the grid, but there's really four separate grids in North America. Um there's the eastern and western separated basically by the Rockies. Uh Texas uh is a separate grid because they wanted to regulate themselves without any uh federal oversight, and then um uh Quebec uh similarly and Canada wanted to have a a separate grid for the same reason. So they they didn't have federal oversight from the Canadian uh side. And so um a lot of these these concepts like slowly came together um and the benefits of being interconnected with your neighbor utility outweighed the cost of the regulation of the regulation for it. And so um, you know, the one of the things that that I was heavily involved in here at NACE was our NURC team and and and you know, Nurk originally came out in the 60s after an outage that that occurred in the 60s and it was voluntary, right? It was only for utilities.

SPEAKER_00 12:07

We started to see the complexity was growing too fast, yep. Um there were problems that were possible that we didn't quite realize, and as we started interconnecting, it became even more complicated.

SPEAKER_03 12:18

Right. Right. Nobody expected you could lose 20, 30, 40 billion people from a single event until it happened.

SPEAKER_00 12:26

Yeah. And so, you know, going back to the when we first started creating these lines all across the US, um, and and to the first really major uh publicly funded, you know, looking at the hydroelectric, you know, for instance the Hoover Dam or Grand Coulee Dam um, massive projects, and this is uh, you know, right around World War II, this type of thing. Um the scale of the Hoover Dam being at you know uh 1300 megawatts and and looking at Niagara Falls at 11 megawatts. Um obviously that's been um you know shut down. They have a more modern version now, but you know, it's it's amazing. I I would imagine at the time 1300 megawatts was kind of unthinkable. Yeah. The amount of power would have been just shocking.

SPEAKER_03 13:17

Power the whole West Coast or something, you know, the the thinking was it was yeah.

SPEAKER_00 13:21

And and do we I mean, do we really have LA or some of these cities the way that we do without that that power generation, that cheap energy flowing in?

SPEAKER_03 13:30

Yeah.

SPEAKER_00 13:31

And is the same goes for Seattle. What are your thoughts on that?

SPEAKER_03 13:35

Yeah, no, I I agree. I mean, I think the um the ability to to have the power the or the energy needed to manufacture, to create movies, you know, you're talking about LA is critical to the growth of of these types of cities in the West in particular. Um you know, one of the big challenges in the West is is kind of the distance from generation to where the population centers are. And so uh many of the plants were built like uh you mentioned Grand Coulee and the Hoover Dam. Uh when those were built, there was very, very little population in those areas. And so we had these very long transmission lines to get it to the coasts, basically, where the population was growing. And even later into the 60s, 70s, 80s, uh coal plants were being built, let's call it in the mountain west. Yeah. And with the same idea, move that power to the coast, particularly to California, as its population was booming.

SPEAKER_00 14:43

And outside of these hydroelectric, primarily these generating stations were coal powered, is that right?

SPEAKER_03 14:49

Yeah. I mean, coal, coal um, you know, probably from the 50s through the 90s into the early 2000s was our primary uh generating source uh as a country as a whole.

SPEAKER_00 15:02

And I think post-World War II, um, we started looking at kind of this nuclear era of generating. Something I find interesting about the nuclear uh power generation is they act similarly to like a coal or natural gas plant and that they're always on. And I wonder um why didn't we invest more? It seems like you know, I look at like France, they're primarily powered by nuclear.

SPEAKER_03 15:30

80% nuclear in France, yeah.

SPEAKER_00 15:31

And I realize a lot of the lead times for construction on these types of plants could be 10 years or um, you know, and whereas putting natural gas, especially after um, you know, the advent of fracking and and just the the cost reduction. Yep. So what's your thought there? I mean, the the transition, we had these major hydroelectric dams. Geographically, there's not really other locations to build projects of that scale. Correct. Um and so, you know, we we built out coal, got to about the 90s, 2000s, and then uh kind of that breakthrough of fracking kind of came into place. But uh, what's your thought on on that timeline?

SPEAKER_03 16:12

Yeah, I mean, specific to nuclear, um, you know, I think it's a it's a very abundant energy source that I wish there was more of domestically here here in the US and and all across North America. Um, you know, I think that the biggest challenge with nuclear is the fear. Um, you know, a a catastrophic event like a Chernobyl, and then there was also Three Mile Island. Sure. Um, it scared the public. There were we were talking about, you know, kind of Hollywood before their movies, yeah, the the the China syndrome and and and others that really scared the public even more. And so public support for nuclear uh significantly eroded uh by the mid-80s, uh let's call it 85, 86 time frame. And so while there had there were dozens of additional units that had been planned to be built, including NACE was originally founded to operate uh six plants that were going to be built in Washington State, of which only one got completed. Um that that public outcry uh really just shut down the industry. In fact, there was a there was a plant in California uh in the Sacramento area that got funded, built, started up, and then there was a um there was a vote, the public decided to shut it down after only one year of operation. So it's a billion-dollar investment just lost.

SPEAKER_00 17:34

Somewhat of human nature, maybe so you know, go you had mentioned the the Northeast blackout, 30 million without power. Uh, you know, at the time I think that was what 30% of the population? It was a massive. The one in the 60s, yeah, right. Which which eventually found you know created Nurk. Yep. Um, you know, what did they really even have a concept of that being a possibility at the time? I mean, it's it seems like it's generally a domino effect that they don't account for is like, well, we have these three things in place, and but if they all go offline, then you know you could end up with a major blackout like that. Right.

SPEAKER_03 18:13

And yeah, I mean, I I would say that it it you may have had, you know, some PhDs at at universities saying, hey, watch out, this might happen. But but generally speaking, kind of within the industry, uh, there wasn't a concept that that you could have such a such a large cascading event. Yeah. But even then seeing is believing. Yeah, exactly. Even then, even after that happened, it was still well, one at that time in the in the mid-sixties, everything was a utility. There weren't kind of IPPs uh like we know them today, and you know, where NACE primarily works. Um, but it still was it was uh best practices sharing. It wasn't a required thing. It was just, hey, you utilities, you should work together better and coordinate, you know, uh make sure that your relays are set properly, et cetera, et cetera. It was the next blackout in 2001 where we lost 50 million people, similar uh area of the of the of the grid where Congress finally said, okay, this is gonna be required. Right. We're not just gonna say you should.

SPEAKER_00 19:15

So it went from just uh, you know, advice to regulation. Yes, exactly. And with stiff penalties if you if you don't do it. Right. Because the uh potential, you know, negative outcomes become so much greater as it expands. Like we said, the largest machine in the world. Yep. Um so you know, you you mentioned 2003, 55 million without power.

SPEAKER_04 19:42

Yep.

SPEAKER_00 19:42

That really solidified what NURC is doing. Yep. Um tell sort of weave in the the story of NACE. Because we uh you know we did come about in the the 80s, but yeah, um, you know, your hand in and what we're doing with Nurk was a big part of that. So I'm curious to hear your story on that.

SPEAKER_03 20:00

Yeah. Um you mentioned, you know, NACE started in in 1980. We did our first O and M contract in 1987. And and the reason that that um a company like NACE could exist was because the market was changing. Um so I mentioned in the 60s it was all utilities. Um in in the 70s uh there was uh uh an act through Congress passed called PERPA that allowed power plants that supplied steam to some kind of process industry to be built with private money. It no longer needed to be regulated by the utility. Um and actually this PERPA regulation required the utility to purchase the power from those plants. So it started to to just kind of crack the door a little bit on deregulation. And so that's what created the opportunity for NACE to exist as an OM company. And um so you know, we we we there were few IPPs when we started doing that work in in the mid-80s, and more and more in them over time. In particular, starting in about 1996 uh through 2002, there was a huge boom. Uh uh uh there was a a large demand growth expected just like we're seeing today, and so lots and lots of plants are being built, and it was being built with private money. And so um that really uh gave NACE the opportunity to to grow uh significantly. Um you mentioned NURC and and the regulations associated associated with the 2003 blackout. Um, you know, one of the areas that that NACE really started diving into um when those regulations became enforceable was the Nurk space because there weren't people that had expertise uh uh in that space, particularly related to independent power producers. And so we we created a team that that uh Um but you know, we we created program documents and and and consulting uh to support our own fleet and then we thought, hey, you know, this is something that the rest of the industry needs as well. And so we've we've grown that business over the years um uh to what it is today.

SPEAKER_00 22:16

Yeah. Going back to when NASA really entered the picture, yeah. Um how much has changed since then to now? You know, in the 80s, uh there was kind of slowdown of what we're doing with nuclear, um, moving more, you know, back towards coal. Um, and then really the nineties and two thousands kind of things shook up there. Yep. So yeah, tell me about how has NACE been involved in that? What what's what's been our thing along the way?

SPEAKER_03 22:46

Yeah, um, so you know, as you mentioned, or as we've discussed, the the the change from kind of coal to gas happened because uh uh one environmental regulations, two uh gas was a relatively cheap and stable uh fuel source. Um and so those plants because they were cheaper and easier to build, uh uh drove more private money into the space. And so we've grown, not that we haven't operated every type of technology except nuclear, but we've grown significantly from the growth in in gas. And um and so that that has been uh probably our the primary uh type of plants that NASA's operated over over the decades. I think you know we operate 250 plants a day, probably um 150 of them plus are gas-based, either combined cycle or or simple cycle. Um so that's where we're we're very, very strong.

SPEAKER_00 23:49

Yeah. And technologically, it wasn't until they found a way to extract that natural gas um in the 90s, 2000s that it became so economically viable.

SPEAKER_03 24:01

Yeah, you're talking about fracking, right, and the fracking revolution. And we found we we could extract gas in other parts of the country, you know, as opposed to just West Texas, for example, and and eastern New Mexico.

SPEAKER_00 24:12

And my understanding was we were going primarily from importing to now we're primarily exporting.

SPEAKER_04 24:18

Yep.

SPEAKER_00 24:19

And so it's really changed our economic uh, you know, in terms of energy production, in terms of the grid, um, how it's divided up has changed dramatically. Yep. Uh and uh, you know, also the benefit of reduced CO2 emissions. Yep. Um so a lot's changed since then. And um now getting into 2010s and and modern day uh renewables are kind of coming online and and they're much cheaper uh than uh they used to be. And so my understanding is now up to what 90% of new energy being added to the grid is renewable.

SPEAKER_03 24:55

Yep.

SPEAKER_00 24:55

Uh tell me a bit about that.

SPEAKER_03 24:57

Yeah. Um, so uh kind of as you mentioned, um wind and solar in particular um for for decades were very expensive relative to the amount of power output that you got. Um and starting around 2010, 2015 time frame, um they the the the cost for installation uh and and operations and maintenance of those went down significantly. And so the these days the the cheapest form of generation is probably solar. The downside of solar, of course, is that the sun doesn't shine all the time and and we need electricity all the time. Um and so right now um uh in in California and in Texas in particular, um a lot of solar is being installed in conjunction with battery storage. Right. So that when the sun is shining, you can you can charge up your battery, and then when you need it, you know, overnight, or at least during the the periods when people are still using it into the evenings, you can discharge those batteries and you don't you don't have that huge drop-off in in generation capacity. So, you know, NASA's played a role and we we we've operated and and done remote operation of of solar battery storage, wind. Um, and and particularly in wind, we've been in that space for over 20 years. Um even before it was as cost efficient as it is now.

SPEAKER_00 26:27

Yeah, I think there is this belief of like, hey, we just need to shut down all the coal plants, we need to shut down all the natural gas plants, and the reality is a little bit more nuanced than that. I think um even as we add much more renewables to the grid, like you said, the the gap um, particularly on whether the wind is blowing or the sun is shining, uh, needs to be filled by batteries, that technology is maturing still. Um so there's some investment. Uh it seems like that's that's growing. The investment of new solar plants going in. Many of them do have the battery technology.

SPEAKER_04 27:05

Yep.

SPEAKER_00 27:06

Um, so there's a bit of a gap there still. And uh it's kind of an all hands-on-deck approach, I think.

SPEAKER_03 27:12

Yeah, I mean, I I think last time we we talked, you know, I I kind of mentioned I'm an all of the above person. I think we need it all. Um, and I think that the economics will drive the economics of each geographical region within the North American grid will will drive what type of generation makes the most sense there. Um, you know, you're not gonna really want to install solar up in Alaska, it's not gonna help you that much that much, you know. Um and so it's just finding the right solution um for whatever the problem is in in the area that you're in is really important. And you know, I don't I don't agree with we should shut down all the all the the uh uh the gas and and coal-fired power plants. I think we we need them and and I don't know how long we'll need them for, but it's at least a decade, sure. Um if not much, much longer than that. Um I'd love to see we we touched on nuclear before, and I think last time we talked, we also talked about nuclear. I'd love to see more nuclear come on, either whether it's small modular reactors or even the large uh you know, 1500 megawatt uh uh type solutions that we already have implemented. Uh I just think it's you know it's expensive to build, but it's a very low cost relative to how much output you get uh over the long term. And these plants now, uh many of them have been licensed for 80 years. So you, you know, you yeah, you may spend a couple billion dollars, but you get 80 years of very low cost, very stable generation. Right. And you only need to take an outage every 18 to 24 months. Well, and otherwise they're just on the grid producing constantly.

SPEAKER_00 28:48

Yeah, always on. Yeah. And it's yeah, I mean, the the benefits are are massive. Uh the in the initial investment, the you know, some of those time frames, some of the regulation involved. Um, it gets more complicated. And when you look at the abundance of natural gas, when you look at the ability to create a generating station for natural gas, much easier.

SPEAKER_04 29:11

Yep.

SPEAKER_00 29:11

Um, and then looking at the future is is these data centers. Yep. Um, they're what 5% of what we're using on the grid currently, but we expect that to grow quite a bit. How much is that going to grow? Do we know?

SPEAKER_03 29:25

Yeah, I mean, by by 2035, the projections are that it'll triple um and so it could be up to 15% of the load growth. Now, one of the interesting things has been that um because the what's called the cues uh within these different uh uh market regions are so long that data center developers are deciding to do what's called behind the meter generation. They're just building power plants not connected to the grid in any way to power just the data centers. Right.

SPEAKER_00 29:58

And so completely isolated.

SPEAKER_03 30:00

You know, that that concept means that that they might be able to build much, much faster now than than kind of we've traditionally seen. Uh the challenge still is getting turbines or or getting reciprocating engines. What whatever you want to use to power um it's sold out for five years. Right. Um if you if you were to order a uh an H class or a G class machine right now from GE, Mitsubishi, Siemens, um, you wouldn't get it till 2031 at the soonest. And so um so are we in a holding pattern right now? We're just the you know, within NACE, we we have our engineered performance team and they're finding turbines around the world.

SPEAKER_00 30:42

Yeah.

SPEAKER_03 30:43

Unused or used turbines um that we can bring and install quicker.

SPEAKER_00 30:49

Right.

SPEAKER_03 30:49

Um so we've found units that are 50 years old that have been in layup for 30 years, and you know, we're gonna make them usable again and install those uh for our data center clients. Um so it it we're we're definitely not at a standstill. Um, but we're not moving as fast as as you know, particularly the the Googles and the Metas and the Amazons would like. Yeah. They're not used to waiting, they're used to spending money and it just happens to be.

SPEAKER_00 31:21

And some of these things are just logistics. You know, we can't just make a turbine appear out of thin air.

SPEAKER_03 31:29

Right. And we're seeing uh uh customers or potential customers go to smaller and smaller units. So instead of installing one 500 megawatt combined cycle type of type of facility, they're buying you know, a hundred five megawatt units. Now that's a it's a maintenance nightmare, but you can get those units faster. Right. You know, you can go down to Home Depot and grab a 500 KW uh generator right now. Right. You just need a lot of those to power a data center. Yeah.

SPEAKER_00 31:59

You know, some might ask, well, you know, why not invest in some of the renewables, like do a solar plant and battery storage and that that sort of thing. And my understanding is may not be reliable as they need. It may not be economical as they desire.

SPEAKER_04 32:15

Yep.

SPEAKER_00 32:15

And I've heard a lot of talk around the small module, modular reactors. Um, maybe the branding gets a boost because there's not explicitly nuclear in the so I wonder if that's maybe an element, maybe it being modular, being small, it feels like very contained. Yeah. Um, I mean, is that the future? Do you see uh we've broken ground on some. What is there? There's one in Wyoming, there's a couple others percolating around.

SPEAKER_03 32:41

But yeah, there's one up at Idaho National Lab, I think, and they're they're installing one at uh one of the utilities up in Ontario at the moment.

SPEAKER_00 32:49

And some of them are up to what, 300 megawatts. Yeah.

SPEAKER_03 32:52

I think the one seem that small. No, I mean it's small relative to you know the traditional nuclear. Yeah. Um, I think there's a lot of potential there. As they've gotten larger though, I worry that you're losing that modularization concept where you can just almost like a trailer home where you can just punch out a bunch of them and ship them to wherever you want.

SPEAKER_02 33:13

Yeah.

SPEAKER_03 33:14

You know, at 300 megawatts, there's still a lot of customization that needs to be done during during the construction phase. Whereas, you know, maybe maybe those smaller kind of initially we were talking about 50 megawatt. You might be able to, you know, build those at a factory and ship them around the around the world. Yeah. Um, so I I do worry that we lose some of that modularization at these larger sizes. It's more attractive uh for people building them because obviously the that that larger power output, but um I I wonder about that piece of it. Yeah because if you're doing 300 and you have to do all that customization, why not just go to the 1.2 to 1.5 gig, you know, traditional.

SPEAKER_00 33:55

Yeah, and I saw, you know, Microsoft is they they purchased the uh reactor of the three mile island.

SPEAKER_03 34:04

Um yeah, they they purchased the output of of that to restart it. Right. Yep.

SPEAKER_00 34:08

So what 2028, it's back online and exactly um 900 megawatts right there. It seems sort of like uh inflection point historically, you know, because it was a big moment that it got shut down in the first place. And um, you know, historically speaking, the safeguards in place at the time did work the way we wanted them to. Um just very scary. Right. Which yeah, obviously the worst case scenario is what we we fear ultimately. But um the Chernobyl.

SPEAKER_03 34:39

And that's a worst case scenario. Sure. Yeah.

SPEAKER_00 34:40

Yeah, exactly. And um, you know, then there's of course the argument of well, what about the the waste? What do we do with that? You know, and um in my mind, I think of that as something that's you know could be kicked down the road a bit, you know, they're probably fine in their casks outside the facility for now. Um but but yeah, I mean, I think at the end of the day, the uh complexity um stuff coming online, the next five years, it seems like these small modular, excuse me, small modular reactors will be a big part of these data centers, especially if they they grow, you know, triple in the next 10 years.

SPEAKER_04 35:20

Yeah.

SPEAKER_00 35:21

Um we're gonna need a lot of power.

SPEAKER_04 35:24

Yeah.

SPEAKER_00 35:24

And the idea that we're gonna be shutting down plants doesn't seem likely in the near term.

SPEAKER_03 35:32

Yeah, I mean the the economics are still very challenging for for coal plants. Sure. Um, and I think that um that's probably the biggest like we want that generation, but it cost twice as much to make a megawatt at a depending on where it is, what type of fuel, et cetera, et cetera. But you know, it can tw cost twice as much to make a megawatt at a coal plant than at a gas plant. Right. And and that's where it gets hard to justify, whether whether you're at a utility and you're passing the cost off to your rate payers like you and I, um, or if you're private equity and you're looking at a return on your investment. Right. Um when you double the price per megawatt, it's just much fewer days you can run and make money. Right. And coal plants aren't good at sitting there cold cold iron and and starting up in a pinch. That's just not how they were built.

SPEAKER_00 36:24

Yeah. Looking at the transmission lines, I think something that is not understood fully is if we do move a lot of our generation to renewables, we have to get that energy elsewhere. And a lot of times these are located um in not very populous places. Right. And so that's a whole other challenge. Some we've talked about before. Yep. Yep. How does that play into all of this?

SPEAKER_03 36:49

Yeah, I mean, the the where we have, particularly for wind generation, where where the wind blows uh the hardest and uh the most consistently are in parts of the country that very few people live. And so um, you know, there's a 3,500 megawatt wind farm proposed in Wyoming. Well, Wyoming has a population of 500,000 people, 600,000 people, you know, very, very few. And so we got to transmit that to uh to places where people live, Texas, California, etc. And and building a transmission line uh in the US today just takes a really long time. We've we've been involved with several, uh one of which took over 20 years, one of which took 15 years. Um and you know, we were talking about the the the load growth of data centers in a 10-year window here. That taking 20 years to build a transmission line is just not going to be realistic to meet the need.

SPEAKER_00 37:50

Is it just the complexity that we're at now? Because I imagine the 30s and 40s there was not you know, there weren't a lot of people to protest these lines being run across the country, and the need was obvious.

SPEAKER_03 38:04

Yeah. So I mean, I think it's a combination of regulatory hurdles, um, uh policy changes uh with with state governments. Um it's different in every state, and and even within certain states, there's differences uh in different counties. Um and then there's there's landowners, you know. You you're building a power plant, generally you can buy a hundred acres or fifty acres of land and it's yours. Um when you're running a uh several hundred mile uh transmission line, you're not gonna buy all the land, number one. And number two, you have to get permission from each of those landowners to have a a project that's in the middle of their pasture, for example, for 50 years with a transmission tower. Right. Um some some folks see it as an additional revenue source and and they're grateful for it, but others are like, you know, not on my land. You know, my my grandfather's grandfather had this this property and I don't want to change it. The NIMBY's yes, exactly.

SPEAKER_00 39:10

You know, uh and not to make it, you know, too political, but of course the there's always concern related to emissions, CO2, these types of things. The reality at this point in time is even if the US gets to zero, the majority of emissions are coming out of Asia. And yeah, I I guess I wonder what what does the future look like there? I mean, we have limited control over how other countries run, and and I think there's an argument being made that we were able to industrialize off of cheap, you know, fuel sources like coal, like natural gas. Shouldn't these other developing countries have the same opportunity? Um so there's a lot of different elements at play that it just isn't, it's not as simple as let's just shut down this plant and it's all fixed. Right. You know, there's the industrial processes that make up a large uh amount of the emissions, and those are very difficult to control. They are, yeah. And so I mean, I know that it's often sort of condensed into this renewables good, conventional bad, but it's really a much more nuanced picture than that.

SPEAKER_03 40:25

Yeah, no, I agree. Um, you know, it it's interesting, you know, particularly in China, where they have been a developing economy for for 50 years, let's let's call it. Um they're building more coal plants than anybody than the rest of the world combined, but they're also building more solar and transmission than the rest of the world combined. Yep. And so they're building that they're they've basically embraced the all of the above strategy. They're building everything, they're building more nuclear than any than than anybody else. They don't have the abundance of natural resources that we have, so they're not really building that much gas. Right. Or the gas they're building, they're actually firing it on liquid fuel like diesel. Um and so it is it is an interesting uh conundrum. Uh, but as I mentioned, I think our our approach in North America and particularly in the US needs to be hey, we just need more power right now. And and so we can we can add emissions controls on the back end, which is what we've been doing for decades. Right. Um and that's probably worthwhile.

SPEAKER_00 41:26

The reality in my mind, it seems like carbon capture is gonna be a huge part of the future. Um, maybe something that doesn't get as much attention and will require a lot of energy. And maybe it's not until we have commercial fusion that really that becomes viable.

SPEAKER_03 41:45

Sure, yeah. Um so it's commercial fusion would uh make all these other sources of energy moot. I mean, you just wouldn't need anything else if we can if we can commercialize that.

SPEAKER_00 41:57

They pull the uh primary ingredients they need from seawater, right? Yes, exactly. And so it's the most abundant resource on the planet. It's I mean, we have more ocean than anything else. Yes, yes. And I think a single glass could power a city. Yeah. Something like that. So you're creating a small star. Yeah. You know, that we're essentially and and they've what a few years ago showed the proof of concept that it they can get there. Um although it's you know, the joke is it's always thirty years away. Exactly. Um it seems like it's probably closer to 1015, maybe to uh something commercial.

SPEAKER_03 42:36

Yep. Um yeah, the proof of concept, you know, it it it worked to create power, but it took more power to to create that power than we got out of it. Yeah. Um but yeah, I mean there's there's two places up here uh just north of Seattle in Everett, two different companies. One's backed by by uh Bill Gates, and I can't remember who the other's backed by. That you know it it seems promising, and I'm very hopeful. It's just even that, even if it's 10 years out, we got a lot of work to do before we get there.

SPEAKER_00 43:05

Yeah. And you know, right now it's in the billions of dollars of funding. Yep. Um, I imagine when there's a little more proof when they they sh you know can create a small generating station that then a lot of you know that private equity will flood into and oh yeah, yeah, exactly. So I I think the moral of the story at this point is there's a lot of possibilities in the future. Yep. And it seems like the current need is the top of mind, the thing that's the most pressing. Yep. And uh, you know, that's human history, it seems like and that's the history of the grid is solving problems as they come up.

SPEAKER_03 43:44

Yep. So and the current problem is this load demand, just right. Needing more flat for for thirty years ish and now which is kind of amazing. Like crazy. Yeah.

SPEAKER_00 43:55

Yeah, and and seeing some of these new innovations with you know. these AI platforms and LLMs and you know Claude and um you know Chat GPT. Yeah it it's amazing. And we don't necessarily know how things will shake out in the next five years. So it seems like there's a lot of unknowns right now. It seems like the thing that people are trusting in right now is to invest their money in the companies that are you know on the the forefront of the technology. But um even looking at a company like Deep Seek in um you know 2025 late 2024, 2025, um they showed that they were able to train their model for much less right you know money, much less energy. Yeah much less compute compute power. Yeah right and so the question is you know how much energy are we going to need? We don't it's hard to say. Right.

SPEAKER_03 44:45

You know more now that the chat bots are talking to each other you know how much how much power is that going to use over time. I mean it's really hard to know. But but then maybe they'll solve our fusion problem.

SPEAKER_00 44:55

Maybe yeah maybe they will just have them talk to each other solve that without we need to get somebody in here that uh is on the ground floor working on you know that cutting edge yeah exactly um yeah I I hopefully you know for the listeners this is giving them a a little bit of an overview of where we're at where we've come from it's a complicated story. It is it's uh it's not as simple as uh you know headlines tend to make it out to be and uh I think that NACE is in an interesting position. We don't own any of these assets we're we're able to go where the industry leads us and um so I think that we have a unique voice in that is trying to see the forest through from the trees a little bit. Yeah so Alan thanks for all your expertise and thoughts um no problem you know uh I I think there's a lot more to talk about but I think hopefully uh this hasn't been too much information but I feel like we've given a pretty good rundown from really inception to modern day.

SPEAKER_03 46:00

Yep. And I I like your uh your analysis that hey we've it seems like every step along the way here has been an adjustment to a problem. And the problem right now is different than it has been. So we will adjust as an industry we will adjust.

SPEAKER_00 46:16

Yeah and it's not something we could have predicted five, ten years ago. Exactly. And who knows where we'll be in five years. So you know looking forward to the ride. I think we'll figure it out I think we will we will humans are pretty resilient. So um but yeah appreciate your time.

SPEAKER_03 46:32

Absolutely