← Shift Key with Robinson Meyer
Shift Key with Robinson Meyer
Say ‘Guten Tag!’ to This New Kind of Geothermal Tech
00:44:19
Rob and Jesse catch up with Mark Fitzgerald, CEO of the closed-loop geothermal startup Eavor.
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- [00:02]
A
You are listening to Shift Key Heat Maps weekly podcast about decarbonization and the shift away from fossil fuels. On this week's show, a new power generation technology was successfully tested this past month in Bavaria. You've probably heard about advanced geothermal, but do you know about closed loop geothermal? This week we are talking to the CEO of a closed loop geothermal company about why their technology is different, why they were in Germany and how closed loop geothermal works. It's all coming up on ShiftKey after this. This episode of ShiftKey is brought to you by Heatmap Pro. Heatmap Pro is the premier platform designed to help users build community supported clean energy and data center projects. Heatmap Pro brings all of heatmap's research, reporting and insights down to the local level in a data and intelligence platform that gives you the information you need to navigate political and permitting risk. It's heatmap software platform that tracks all local opposition to clean energy and data centers, forecasts community sentiment and guides data driven engagement campaigns. Go to heatmap News Pro to book a demo and see the premier intelligence platform for project permitting and community engagement. That's heatmap News Pro or check it out in the show notes now. Hi, I'm Robinson Meyer, the founding executive editor of heatmap News.
- [01:33]
B
And I'm Jesse Jenkins, a professor of energy systems engineering at Princeton University.
- [01:37]
A
And you are listening to ShiftKey Heat Maps weekly podcast about decarbonization and the shift away from fossil fuels. On this week's show we are talking about a new way to generate heat and power without carbon emissions. A first of a kind project just opened. We're going to talk to the CEO of the company. This month Eavor Technologies flipped the on switch on the world's first first closed loop multilateral geothermal project. We're going to get into what those words mean, but this project is generating heat and power for the small village of Gettzried, Bavaria, which is about a quarter of the way between Munich and Innsbruck. And Jesse, I think it's exciting anytime you get a first of its kind power generation technology to switch on. Like this just doesn't.
- [02:25]
B
Yeah, this doesn't happen every day.
- [02:26]
A
Yeah, like when was the last time it did happen? Do you even know?
- [02:30]
B
I guess you know. Also in the geothermal space, Fervo Energy's project in Nevada, the first to generate power from enhanced geothermal in with multilateral hydraulic fracturing. We'll break out kind of how that differs from what we're doing. But yeah, there's Been a lot of excitement in the geothermal space and then I guess in energy storage, there's new technologies coming to market as well. You know, one of the reasons I wanted to do this episode, Rob, is we've had some requests from our listeners for more upshifts. You know, the political news and the kind of headwinds in the United States, I guess, are a little downshifty lately, to put it lightly this year. But despite that, there is tremendous innovation going on all over the place. It's the part that when people ask me, like, what gives you optimism or what keeps you going in this fight? One of the things that keeps me going is meeting and learning from and getting to support and help technology companies that are pushing the frontiers of what we can do and adding new tools to our toolkit in terms of decarbonization. And Ever is one of those that I've been excited to work with for the last four years or so. I've been an advisor on the advisory board of Ever since October of 2021. I first worked for them as a consultant, trying to help them understand what their market potential looked like of their technology. If they could kind of hit their milestones and came away from that so impressed with their potential to really open up a whole new way to generate clean heat and power around the world that I wanted to find a way to work with them and help them. So really excited that they've reached this milestone. It's been a journey. I've been able to be a small part of the last few years of that, but got a tremendous team and excited to dive into what they've been up to.
- [03:56]
A
Jesse, we should say you are on Ever's advisory board. You also have an equity interest in Ever. Heatmap, of course, does not. We are fully independent journalistic outlet. And so although I'm excited to talk to Mark today, we have no interest in this company other than our curiosity, but we have no equity interest in the company. We're interested, not interested, don't have an interest. Our guest today is Mark Fitzgerald. He's the president CEO of Ever Technologies. Mark has an interesting background. He spent 35 years in the energy sector and really in oil and gas. He was most recently president and CEO of Petronas Canada and he actually worked for three years as vice president of international assets for Petronas in Kuala Lumpur. And so here's someone who came to decarbonized Energy and kind of the broader climate tech sector with a long background working for the other kind of Geothermal working for the other kind of energy you take out of the ground. Oil and gas coming from, I guess you would call it the carbonized sector. And so he brings a really interesting perspective on, I think, this industry. And it's, I don't know, it's always good to see someone who, who worked in oil and gas for a while now coming on the light side of the force. Yeah.
- [05:09]
B
And I think that's, that's a pretty consistent story in the geothermal space, given how much the skill set and expertise transfers directly from oil and gas into drilling. From oil and gas to drilling for heat. Founders at Fervo Energy also have oil and gas backgrounds and experience and a lot of the workforce and the team at EVER is particularly. This is true for them as well cut their teeth drilling in the only industry that was drilling.
- [05:32]
A
Right.
- [05:32]
B
Which was oil and gas. And so if you've got expertise in this space, it probably came out of that sector and is directly applicable to producing clean energy from clean heat.
- [05:41]
A
And with that, Mark, it's great to have you on Shift Key. Welcome to the show.
- [05:45]
C
Thank you so much. It's great to be here.
- [05:48]
A
So can you start just by describing Evers technology to us? And I'm going to ask a somewhat impertinent question which I apologize for asking in advance, which is can you articulate. I think at this point many, not all, Shift Key listeners may have heard about the kind of other geothermal company in the space. Fervo. Can you just describe what EVER is first, ever's technology and then maybe how you're different from other players in the space?
- [06:14]
C
Yeah, I'd love to be able to talk about that in a way that we believe is the most significant advancement that can, that has been made in this space in terms of environmental consistency in that application. So we'll get into that because it's, you know, I, I just love to talk about this. EVER is focused on what we call a closed loop system. And what a closed loop system is. We essentially complete a radiator underground. So think of a fork, a fork with maybe 12 tines at the end. And if you turn the end of that fork 90 degrees, we drill a vertical well down, we send out upwards of 12 laterals or 12 times of that fork, and then we do it again. And we connect the end of the fork, two forks together, and in doing so we create a continuous loop where water will flow through one vertical well. It will then access that those laterals or those horizontal wellbores. It'll flow through the Rock spin around at the other end where we've interconnected them, flow back and then flow up to the surface and generate either heat or power. What's the difference? First and foremost, we can access thermal gradients that are not accessible to other geothermal systems in and around the world. In other words, we don't need as much heat. And so we become a system or a geothermal system that can be deployed in many more regions than existing geothermal systems.
- [07:50]
B
Right.
- [07:51]
C
Now the second is you often hear the term enhanced geothermal systems. What that is systems that fracture the rock well below the surface, they inject water through one wellbore, it flows through those fractures and then it comes up the other. It's very much in focus, especially in the United States. What our focus or what we do at Ever is we do not fracture the rock. We don't need to fracture the rock, we don't inject water. We have a closed loop system. Once the water is in the system, it's a continuous cycle. And I really want to reinforce that because it's a really important point, especially as we think about environmental sustainability go forward. In other words, once the closed loop system starts to operate under the principles of a thermosyphon, which we can get into, it just runs. The Eavor loop just continues to operate, which is critically important for users that require stability and reliability. Because we don't inject energy, we don't emit, we don't have emissions.
- [08:53]
B
So at the surface this is a very limited footprint. Right. It's a fairly small power plant. And then underground you've got this kilometer scale heat exchanger, effectively you've built without fracturing, but with a lot of drilling involved. Right. So the key I think for making that work is to continually advance the economics of drilling. What is Ever's strategy there for bringing down the cost of drilling these closed loops so that they're, they become cost competitive despite the large amount of total miles drill that you have to or kilometers drill that you have to put down.
- [09:22]
C
Yeah, I think that's a great point, Jesse. And I would reinforce that drilling technology or drilling efficiency has been something that's been talked about and understood across the globe for 100 plus years. So we are not creating a new method of drilling. We are not looking for something that hasn't been already done across any of the unconventional players in North America, any of the big drilling or service companies or operators around the globe. What we are doing is changing the trajectory and changing the application of that drilling methodology to create the underground Radiator, as you were talking about out my background, I spent 36 years in oil and gas, a great proportion of that in the unconventional space before I had this amazing opportunity to join ever. And so I understand how through sound engineering, sound geoscience, proper modeling, that cost compression will occur. One of the best examples that I point to is we completed six laterals. So six of these horizontal wells or these forks of the tine connected them. In Garrett's Reed, our first facility In Germany, the fourth and fifth laterals were done at 50% of the cost of the first two. And so already in moving from lateral one to lateral six, we've seen a reduction of 50% in the cost structure. The second is that in terms of pace of drilling and the faster you drill, the lower cost that you incur. The pace of drilling for us on those fifth and sixth laterals was six, three times. Excuse me, what? It was on lateral one and two.
- [11:07]
A
So how do you make sure, I mean, I have a bunch of questions. We want to talk about this first project, but how do you make sure that the tines connect?
- [11:14]
C
Yeah, it's a great question. We use what's called active magnetic magnetic ranging. Excuse me, I talk too fast. And so the simplest way to put it is at the end of the drill string or the drill pipe at the end where the drill bit is, you have a tool that understands and knows exactly where it is relative to the other horizontal that you want to connect to. And so as we drill down, it gives us the ability to steer into and connect with the other end of that, that other horizontal wellbore. And so as I talk about utilizing existing technologies and existing skill sets from the oil and gas industry primarily, we add this innovation that ever has created in the active magnetic ranging to intersect. And in doing so we're able to create this closed loop system that drives all the efficiencies and the environmental and sustainability benefits that I talked about.
- [12:14]
B
And that's a key innovation because there's no reason for oil and gas operators to try to intersect their laterals. Right. They're trying to bring them out and they do need ranging to stay within the right, like rock strata. Right. The right layer to stay within the reservoir that they're trying to access. But like, you don't want to be intersecting another one of your drill wells at that point. So this is one of those key things. I mean, just picture the scale of these. I mean, like, how far down do you go? And then how long are these laterals? How people picture this sort of giant straw you're sticking in the ground and then finding some way to connect. Yeah.
- [12:41]
C
It's fantastic to me that this innovation and this technology and these tools can create this interconnection 100% of the time. Like that just is.
- [12:52]
B
I mean, it's not an insignificant achievement.
- [12:54]
C
No. And so it's one of the reasons that we see the advancements in geothermal systems like the Everloop technology. So we go down in Germany, for example, four to four and a half kilometers, and then we go along three and a half to four and a half kilometers. So our entire loop, so from the surface underground, out into the rock, back again and up is about 16 km. So it is the longest continuous wellbore, if you want to call it that, exists in the world. It is substantive and it works. Rob, to your question on how do you continue to drive further and further efficiency? Well, it's these innovations in how do we drill quicker, how do we connect much more quickly, how do we ensure that we can go deeper? Because as you go deeper, you access higher temperatures, how can we reach longer? Because as you reach longer, the cost to reach is disproportionately smaller than the energy you access. And those are exactly the lessons, exactly the way that the unconventional oil and gas space evolved to be as efficient as it is today. So we're just following a model that already exists.
- [14:05]
B
So I want to come back to some of the other innovations that are already in your basket that might help you expand as you sort of go forward. But let's talk about that first project, because this is the sort of exciting milestone that it's not every day that you get to see the start of operations of kind of the world's first of any new power generation technology. So walk us through what the Gerd street project looks like and where you're at, kind of where it started and where you're at now.
- [14:27]
C
So this all started about six years ago, seven years ago in Northern Alberta in a test facility. And that was the first test, if you will, the first opportunity for ever to prove that this closed loop system was a reality. And that resulted in a decision to develop a facility in Garrett's Reed. And the focus on that was to expand the test to prove that the Everloop system with the multilaterals would work, that it could deliver the thermal energy as modeled, that we could generate power, and that we could do so in a way that gave us visibility to being competitive with other sources of heat and power supply. And so started that project about three Years ago, really excited. I think my second week in the job I had the opportunity to visit that site for the commissioning. And the first thing that was very, very encouraging for us was the hydro siphon, or the flow of fluid through the system was as expected or even slightly greater than expected. The delivery of temperature, the delivery of heat back to the surface, which equates to energy, was at or greater than expected. And then about two and a half weeks ago, we generated first power. In other words, we were able to utilize the energy delivered from the rock in the form of heat to spin a turbine which generated power, which was then interconnected with the grid to provide power to the local municipalities. Very, very big accomplishment for us. And we celebrate that for a few reasons. One is we have proven that the technology or the geothermal system that we have designed works as modeled, works as engineered and can generate power.
- [16:24]
A
Can you give us a sense of the numbers around this project? How, what's the, how much heat, how much power? Even to the degree you can reveal kind of the order of magnitude of investment that a demonstration project like this required.
- [16:38]
C
The design of the facility is for 8.2 megawatts power generation and 64 megawatts on the heat side or thermal delivery. We will reach that upon completion of the project when the second, third and potentially fourth ever loops are developed. So that was the original design. Because it's a test facility, the efficiency of the heat and power delivery will not be exactly where or not be at where we expect it to be on the second facility that will develop or third facility or fourth facility. So we're, we would say we're generally competitive in terms of thermal delivery or heat delivery into the German market. Right now that's somewhere in the 50 to $150 per megawatt power. We're not where we'll be, but ultimately we have pretty good line of sight, we believe, to competitiveness in the markets that we're going to focus on which we can speak to.
- [17:37]
B
So I want to break down those markets a little bit and talk about kind of why the efficiency of heat to power conversion is relatively low compared to other thermal generation technologies. Kind of on the order of 10 to 20% depending on the input temperature. And so that gives you a big advantage to producing and using heat directly. Because you get at a coal fired power plant you maybe get three times as much heat as you get out power, whereas at a geothermal power plant you might get five or even eight or ten times more heat as you get power. So let's Talk about that heat market first and how you're sort of seeing ever strategy evolving in Europe and in other markets where there's a large demand for district heating and decarbonization is still a priority and getting off of natural gas is a key priority as well as they shift away from Russian imports.
- [18:22]
C
Of course. Yeah, of course. Ever's primary focus right now is the heat markets in Europe. Absolutely. With the district heating model we've shown we can be competitive in the cost of heat or the cost of thermal energy delivered into that. And to your point, there's a few things that continue to make that very, very attractive as we start to commercialize the ever loot systems that we have. The first is the competitive market. Two is access to data, especially in Germany. We have free and clear access to subsurface data. It's public. The third is policies in Europe around emissions. Decarbonization Ever fits very, very well in terms of our geothermal system in supporting that because we don't use excess water, because we don't require any hydraulic fracturing, because we don't require any energy. So that, as you highlighted is kind of step one. Step two, if you want me to talk to that is we believe very, very strongly that future growth for us will also expand beyond the thermal or the heat market into the power generation. And that competitiveness will come from the focus and the work that we're doing right now to drill deeper and access hotter rock. And we're quite confident in our ability to go very deep. And we believe that by accessing that higher thermal energy underground, we'll be able to be competitive in the power markets in regions such as the United States, regions such as Japan, which is very, very focused on energy security and of course regions in Europe. So very much a two stage model for us. One is monetize and commercialize geothermal systems into the heat market in Europe and then use our learnings, creativity and expand that into the opportunity to also be competitive. And we think we will be actually we will be in the power systems in those big markets right now for sure. Us, Japan and Europe.
- [20:29]
A
We have a few questions, but I'm gonna. On the commercial, the first commercial project, you mentioned that it was kind of competitive on heat with German heating costs. It was not competitive with power for German power costs. Why put the project. Is there a reason the project isn't in Bavaria? Is there a particularly good geothermal resource in Bavaria? Does it? I mean Europe kind of has more expensive power than the United States or China at the moment. Is it actually helpful. Does that mean that Europe winds up being a particularly good test ground for these development projects that kind of test out a new technology because you actually have the least amount of ground to cover to, to get to cost parity. What's the reason for putting it in Bavaria? If you are, you know, you're from Canada to I think Canadian company, Wine, Germany.
- [21:17]
C
Yeah, yeah, that's a great question. You know, other than the fact that as we talked about earlier, it's just an amazing place to be. There's a number of reasons that we picked the project location in Bavaria as our first test pilot. One, it was an existing geothermal site. A traditional geothermal development was planned there. Unfortunately didn't work out. So it was an opportunity for us to take over that site. The land disturbance was minimal and we could utilize that. The second, as I highlighted is we had very, very good access to subsurface information. So we were able to understand the rock and those details and complete the modeling with a high degree of certainty in terms of what we were drilling into. The third, as you've already highlighted, is that the heat market in Europe is higher, the pricing is higher than it is in North America. And so the opportunity for us to access a higher priced heat market was important.
- [22:16]
B
It's also a lot bigger, right? I mean, there's a lot of district heating in Europe that's easy to plug into and very rare in the United States. So we really don't have a lot of large scale district heating systems.
- [22:25]
C
No, you're exactly right, Jesse. And then one of the major criteria for that is the focus by Europe on decarbonization, environmental sustainability and the support that exists in Europe to do that was very, very attractive to us. So support from the European Union Innovation Fund, the opportunity to get support in terms of tariffs and structure was quite important to us. And so you kind of bring these all together and as a test facility and as an opportunity to prove out our closed loop geothermal system, it was highly attractive. One of the things that, that we don't talk a lot about is because the Ever Loop system doesn't require a unique geothermal or unique temperature gradient or in each unique subsurface gradient, believe it or not, Bavaria was just very average. Like the geothermal gradient in Bavaria is just very average. And so it was a great opportunity for us to say we're not going to the best place or the easiest place to prove it. We're of the belief that an Everloop system can be developed just about anywhere around the world. And so let's pick an average spot and we'll show that it works.
- [23:43]
A
And when you say gradient, what do you mean?
- [23:45]
C
Sure, yeah. And so like, the ability to generate heat and the ability to generate power is a function of how much heat you bring from below the surface. Different areas of the world have different gradients. In other words, if you go down a kilometer, how much does the temperature change? And when I say an average gradient, so about every kilometer we go down, it's maybe a 25 to 30 degree increase in temperature. Other technologies would require higher than that because they need more thermal energy, more thermal development at surface in order to be competitive or to be efficient. We also have the ability to go deeper and hotter, which we've talked about, to ensure that we're highly competitive in terms of cost of supply on the power side. And so that flexibility and that ability to move between, between different gradient types depending on where we are and depending on what the customer wants, is a significant advantage that we plan to really ensure we utilize in our commercialization go forward.
- [24:54]
B
Let's talk about the future then, for this technology. And forever, as you kind of have proven this operations, now, it's a real thing, people can go kick the tires and see it in operation. Right. Generating heat and power. The idea is you can do this pretty much anywhere. But where are you going next and why? And kind of what can we expect over the next couple of years from ever?
- [25:10]
C
Yeah, the first thing for us is, you know, we're going to focus where the opportunity in the market is first and foremost. And that is the European heat market. That's where we've kind of cut our teeth. That's where we've proven this, and that's where the opportunity is. We will do that through partnerships with regional developers. That is our strategic focus right now. And so while we developed and operated Garrett's Reed, we see ourselves very much as the technology partner or the systems partner in develop it in Europe. There are companies in, in the regions that are very good operators, very good at execution. They know the market. Their focus is aligning with geothermal heat and power development. And so for us, the natural.
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B
Are these. Sorry, are these oil and gas companies, when you say operators, these oil and gas companies traditionally, or are they power developers or. It's a combination. What, what kind of companies are you turning to?
- [26:04]
C
Yeah, I think, Jesse, certainly oil and gas companies have the greatest expertise as it relates to drilling completion and operations. And many are transitioning towards geothermal supply as sort of a balance in their portfolio, especially In Europe, where policy and regulation are moving that way. And so that's first and foremost where we will focus. We believe that the same model will, will apply in the United States, Japan, Canada as we move deeper, hotter and towards power generation. Where forever to develop the expertise to be top tier global drillers, top tier global operators takes a lot of work, a lot of investment and replicates what already exists in these regions. Our strength is in our innovation. Our strength is in the geothermal systems. Our strength is in and knowing how to develop and create that. And that's where we're really going to focus. Others have expertise in drilling, operating and regional geology and real regional subsurface understanding. And in creating those partnerships, we think we bring the best of both to bear.
- [27:13]
B
And we should just pause and note how big this market is for folks. Gertz Reed is a pretty, a small, cute little village, right? It's like 20,000 people. There are large cities around Europe that have large district heating systems for populations of millions of and I think closing in on a fifth of all heat on the continent is supplied by district heating. It's a key pillar to the overall decarbonization strategies along with heating electrification in the form of heat pumps. The other big strategy is district heating. So this is a huge market potential just in the European heat sector for quite some time for Evertor and partners to be drilling lots and lots and lots of projects around the continent.
- [27:49]
A
Can I ask Mark, you came to Evor with decades of experience at Petronas Canada, you worked in the oil and gas industry. What's the lessons you've taken from oil and gas to ever? And I would also say, look, oil and gas delivers a lot of energy to people. What do you think are the lessons that kind of the broad decarbonized world of energy should take from the oil and gas industry as the industry frankly that already has scaled to deliver as much energy as it does.
- [28:18]
C
You're absolutely right, Rob. I spent multiple years with multiple international oil and gas companies, started my career with Chevron, had the great opportunity to lead Petronas's global upstream business. Just fascinating for me and there's a couple things in there that that are really, really important. I have a very, very strong belief that global energy demand is growing and will continue to grow. But I also have a very strong view that the mix has to change and that as we move towards the principles of decarbonization, sustainability, social progression, that it's critical that we transition towards more sustainable supplies of energy, go forward is that we often Hear this conversation around, replace. I don't believe that. But geothermal has a really, really important role to play in terms of geothermal energy supply supply. As we move forward, one of the things that is understated is the skill sets and the talent transfer almost 100% from oil and gas into geothermal. Understanding the subsurface, geophysics, geology, geomechanics, they all transfer straight across. The difference is we're not drilling for pockets of oil or natural gas. We're not drilling to fracture the rock. We're just drilling to draw heat. But the drilling fundamentals are very, very much the same. The transference of skills in building surface facilities, those exist and have existed for years and years and years. Commercial skills, legal skills, accounting, hr, financing, go down and down their list. And so what's exciting to me is there is an absolute talent pool globally that as fossil fuels continue to, in my opinion, decline in terms of relevance, those skills are transferred right across to geothermal development, whether it's our company or other companies. And so it's a natural transition and it's exciting transition. That's different perhaps than some of the other industries that would compete. Small modular reactors. They're very little transference of skill across to that, similar to wind and solar, other than perhaps the mechanical engineering side of that. And so the great majority of our staff here have come from oil and gas companies, except now they're committed to delivering heat and power with no footprint in a different way, including myself.
- [30:57]
B
I think we have to leave it there.
- [30:59]
C
Well, I, I appreciate the opportunity, Jesse and Rob, I really do. I'd love to tell the other story. I think it's material. It has a chance, it really has a chance to make a difference. And people have asked me, why did you leave oil and gas? You had a great career. Why did you leave oil and gas? Why are you not retired? And I share with them that this is a company that has a chance to have a material impact globally. The right way. The right way. And I want to be part of that. I want to help in any way I can. So telling the story is a great way to support that. Thank you.
- [31:32]
A
Well, thank you so much. Yeah, thank you for joining us on shift Key.
- [31:36]
B
And congrats to the whole ever team for first power and that milestone reached.
- [31:40]
A
It's a big one.
- [31:41]
C
Thank you.
- [31:51]
A
And now it's time for Upshift Downshift, our weekly look at climate and energy news where Jesse and I pluck daintily one item of current events from today's periodicals survey. It Assess whether it is good news or bad news for the energy transition. If it's good news, we call it an upshift. If it's bad news, we call it a downshift. Jesse, there have been a lot of downshifts lately and I'm wondering, do you have an upshift for, for us?
- [32:17]
B
I do. I've been intentional to try to bring an upshift to today's episode, try to keep the positive news stories coming. And it really is again, on the innovation side of things. I mean, the technology toolkit that we have just keeps getting better and better. And one example of that is news from this month that two US based battery companies have achieved a sort of breakthrough in the stability and performance of silicon anodes for batteries. For those who don't know, and I have to always keep this in mind, which is, batteries have two sides. They have an anode and a cathode, right? And in the case of lithium ion batteries, lithium ions are what ferry energy back and forth from one to the other. So the anode is the part of the battery where the lithium ions are stored when you're charging. So when the battery is charged up, I think the word is intercalate. Basically they get caught inside this mesh of some other material. And the most commonly used material today is graphite. So silicon is another potential anode material, and it's one in which we're already actually seeing some high end smartphones in China now deploying silicon anode batteries. But we're starting to see a major push by several companies to commercialize silicon anodes for use in large format electric vehicles. There are some really cool things about this. One is that they have the potential to charge much more rapidly than graphite anodes. And the second is they're much more compact, so they can achieve a much higher energy density, upwards of 400 watt hours per kilogram. Also higher volumetric density per liter. That's almost double what kind of the standard battery in the market today is, especially if you compare to like LFP batteries, a couple which are in the kind of 200 to 250 watt hours per kilogram range. That means you can have a much smaller battery, lighter battery in your car. You can get better range and faster charging times. One of the challenges with any of these batteries is making sure that they're robust enough to operate in all the kind of real world conditions that you might find a car which is a bit more challenging than a smartphone, right, which mostly sits in your pocket in air conditioned and weather controlled areas, you know, EVs got to survive in hot temperatures and cold temperatures and all kinds of other things. And so what this particular news announcement was is a company called Group 14 Technologies, which is backed by Porsche and a New York based battery materials firm called Psionic Energy that announced results that they had 100% silicon carbon anodes that achieved stable performance at very high temperatures during charge discharge cycles. So they were able to withstand the kind of conditions at up to 60C, that's 140 degrees Fahrenheit that you might need to survive in an on road vehicle context. So this is just one more data point that we're kind of moving to market with a range of advanced battery technologies. We've seen a steady decline in the cost of lithium ion batteries, largely achieved through economies of scale in manufacturing in China over the last few years. But that doesn't mean that there isn't further actual technology innovation to be had in this sector. And with like a trillion dollar auto industry behind now pouring money into better batteries and everybody competing against each other to come out with the best vehicles and best batteries, there's a lot more Runway to go in terms of improving lithium ion batteries. And this shift to silicon anodes is just one of those potential improvements.
- [35:23]
C
Do you.
- [35:24]
A
Well, we should have another episode, episode about batteries. I want to, I feel like I still need to understand battery chemistry so much better than I do. I could tell you about cobalt nickel, I could tell you about, I'm sure.
- [35:34]
B
We all know lfp. So that's the other side of the battery. That's the cathode is the LFP part and, or the nmc. That's all describing the materials that go into the cathode where there has been a lot of improvement on changes made switching from high nickel batteries that are used in say Teslas in the past and other higher performance vehicles to lift lithium iron phosphate, lfp. This is the other half of the battery where there's been much less innovation in the last few years at least. And this is kind of the one of the big step changes that might occur there, switching from graphite to silicon carbon. The other thing I'll add is there's a bit of a, you know, industrial competitiveness upside here too, which is that at the moment anyway, while there's certainly lots of innovation happening in China on anything battery related, there are several world leading firms in the United States pushing the boundaries on silicon and anodes and the US does not produce really any graphite. Today, almost all of the world's graphite is at least refined, if not produced originally in China. And so as the US tries to build an independent supply chain, one of those biggest thorny challenges is where are we going to get the graphite from? You can open up new mines to produce natural graphite. You can potentially produce it from like, coal waste, coal, these kinds of materials. But another alternative is just skip the graphite entirely. We got plenty of silicon that we can produce. And so this is an area where the US might be able to kind of keep up in the technology race if we continue to support companies that are innovating in the anode space. Rob, what do you got for us this week?
- [36:56]
A
I have a downshift, but I think it has.
- [36:59]
B
Come on, Rob.
- [37:00]
A
I know, but I.
- [37:01]
B
You're ruining it. You're ruining the mood.
- [37:02]
A
But I kind of think it's more of like a downshift on the surface than I think we should actually see it as a downshift. So the Financial Times reported today, we're recording this on Monday, as we usually do. The Financial Times reported today that the EU plans to scrap its 2035 ban on combustion engines. And so it will allow automakers to continue to make what they described as a limited number of gasoline and diesel fueled cars, unquote, after the ban was meant to come into effect. They actually didn't say gasoline, they said petrol because it's a UK newspaper. But I did a little translation for us. Originally, this ban was supposed to prohibit all combustion engine vehicles, the sale of all, and the production of all new combustion engine vehicles in 2035, like literally all of them. The EU will now allow a limited number of new vehicles to get sold. And I think the terms in which it's doing this are kind of interesting. So first of all, it says if you use, you may be allowed to use some green steel and produce some combustion, some internal combustion vehicles, which I don't really kind of appreciate as a demand.
- [38:07]
B
You're going to give them a loophole. That's a nice. Yeah, a little.
- [38:09]
A
It's like a fine loophole. And the second One is that EVs could possibly use range extenders. So this is a technology that we've talked about in the past, which is you have a small gasoline engine attached to the car, they're called E Rev sometimes, and you basically use it as backup or you use it to extend the range of your battery. They're very popular in China. I think partially the success of the Chinese model here that they've. We don't talk about when we talk about the number of EVs sold in China, we're often actually talking about a number that includes plug in hybrids and EREVs. And plug in hybrids and EREVS have been very popular in China. And I do think, to quote a famous Chinese policymaker, you know, I don't think we should particularly judge the color of the cat here, as long as it catches mice. And it seems like the Chinese policy of encouraging electric mobility, even if you have a gas engine in there, has caught more mice than anyone else. And we should learn from that example. And so it's facially a rollback of a climate policy. But if these things are going to get rolled back, I think these are kind of two sensible changes. Now maybe by the time this episode comes out, 30 hours from now or so, the news will have changed and I'll look like a doofus for saying that. I think there's kind of some upshift qualities in here. But look, this is a very unpopular policy, especially in Germany. It's a very difficult economic moment in Europe. And the country is dealing, the European Union is dealing.
- [39:34]
B
It could have been much worse.
- [39:36]
A
Yeah, it's dealing with all the same economic competitiveness and industrial competitiveness problems that the United States is, but from a platform of having no technology industry, really, and not the same kind of background story of economic growth. It's a hard moment there. And I understand why policymakers would kind of get more pragmatic, but I think this is a good direction to get more pragmatic in and what, you know? Yeah, yeah.
- [39:57]
B
I mean, as you know, I'm a big fan of the idea of EREVs in the US market as well. This is not your standard plug in hybrid that would be on the model market today. Like in an electrified Jeep lineup, for example, or Toyota Prius prime, where you have a relatively small battery good for 20ish miles range. These are much larger batteries good for usually 60 to 150 miles of range, which is enough to cover almost all of your regular driving. And then you have this extended range, basically just a generator. It doesn't actually supply power to the wheels of the vehicle. That's another thing that's different from many of the plug in hybrids or the gas engine still has a full drivetrain that it's connected to. This is just a generator that basically produces electricity when you need it. And it's pretty efficient at that, on par with hybrid electric vehicles in terms of their fuel economy. So when you're already on gas, it's a pretty efficient gasoline engine. I think it just makes a lot of sense in the US context where you've got a lot of big areas with big open, open planes and people driving long distances and you have a lot of desire for big heavy cars that would require very large batteries in order to deliver the kind of range that we expect. A 300 mile range F150 pickup truck, for example, has a huge battery in it. You could cut that battery to maybe a third that size and throw a gas range extender in and you'd have a pretty competitive and more affordable vehicle. So it makes some sense.
- [41:12]
A
And I think we should recognize the amount of creep that has happened throughout electrification. I mean, look, you can watch a Toyota commercial that is not on TV right now. It has been on TV recently. I used to see it all the time where they talk about their fleet of electrified vehicles or how they were getting into electrified vehicles and what they meant was that they were selling hybrids. Yeah, but at the same time, I think on the climate policy side, we actually engage in some of the same language creep where we talk about how electrification is winning and we're in fact talking about a set of vehicles that include plug in hybrids, include E revs and also include full battery electric cars. And so we should be honest that like we cannot talk about how electrification in this broad Catholic way is winning and then mandate the most intense and restrictive form of electrification. I mean, maybe we can't, but I don't think it's very intellectually honest. I think if we're trying to create a successful economic and mobility policy, we should be honest that all forms of electrification, by which I mean plug in hybrids, E revs and full battery electric vehicles are winning. Not including hybrids, though hybrids seemingly are doing well in the United States at the moment.
- [42:20]
B
And if you're going to drive an internal combustion car, it should be a hybrid.
- [42:24]
A
Yeah, exactly. I mean, it's actually kind of crazy that we don't just consider hybrids, conventional Prius hybrids, a normal upgrade to internal combustion car operation. In the same way we think of CVT engines as a normal upgrade. Nobody. Anyway, it's neither here.
- [42:44]
B
Toyota is, you know, basically they don't sell a non hybrid version of the Camry or RAV4 anymore. They're two most iconic, largest volume vehicles. They just have a hybrid version now. So it is starting to happen.
- [42:55]
A
I think we should be honest that like if when we say electrification is winning, what we mean is that all forms of electrification are winning and we should mandate all forms of electrification. We. And this is something I'VE frankly changed my mind about. Could I also tell you, Jesse, do you know how I'm getting old? I know I'm getting old because I'm driving somewhere and I see a Toyota Camry on the road, always a hybrid. I would never think about this, about an internal combustion car. And I think and I too share some historic frustration at Toyota. I was very frustrated with them during the first Trump administration and how they behaved around the fuel efficiency standard repeal. I thought they were just acted in a despicable way. But I do see a Toyota sedan on the road now and I think that's a sensible vehicle. What a sensible vehicle.
- [43:38]
B
I was going to say that Sensible. That's exactly the word that came to mind for me too.
- [43:41]
A
It's crazy. Listen, I did not think this way when I was in my 20s, but now I know middle age is here.
- [43:48]
B
Just wait till you start checking out minivans.
- [43:50]
A
Well, that's okay. I kind of have had a begrudging respect for minivans the whole time. That's a. Anyway, Shift Key is a production of heatmap News. Our editors are Jillian Goodman and Nico Lauricello, multimedia editing and audio engineering. Engineering is by Jacob Lambert and by Nick Woodbury. Our music is by Adam Cromwellow. Thank you so much for listening. We'll be back a little early next week with a year end wrap up. Happy Hanukkah if you celebrate and thanks for listening. See you next.