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Speaker 1: This is Dana Perkins and you're listening to Switched on

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Speaker 1: the BNAF podcast. Today's show is about long duration energy storage,

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Speaker 1: a potential answer to the intermittency for renewable energy, given

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Speaker 1: how fickle, whether it can be at times when you

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Speaker 1: need it for solar or wind power. How close are

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Speaker 1: we getting to that answer?

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Speaker 2: Well?

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Speaker 1: Today I am joined by analysts Yee Zoo, a clean

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Speaker 1: power specialist at BNAF, alongside Evelina Stoiku, who's from our

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Speaker 1: energy storage team. From electrochemical to thermal to mechanical. What

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Speaker 1: are the long duration energy storage technologies that are out

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Speaker 1: there and how mature are they? They draw upon notes

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Speaker 1: from the inaugural Long Duration Energy Storage Cost Survey. This

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Speaker 1: can be found at bn EF once logged into the

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Speaker 1: Bloomberg terminal, or at BNAF dot com. But right now,

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Speaker 1: let's jump into our conversation with Yee and Evelina about

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Speaker 1: some of the possible opportunities for long duration energy storage. Evelina,

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Speaker 1: thank you for joining today.

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Speaker 3: Hi Dana, nice to be here, and Yee.

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Speaker 1: Thank you for joining on the show.

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Speaker 2: Thanks for having Austin.

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Speaker 1: So we're going to talk about long duration energy storage

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Speaker 1: and the first question has to be what do we

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Speaker 1: mean by long What is the time frame that makes

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Speaker 1: it long duration versus just energy storage.

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Speaker 3: Well, that is a very good question, and the reality

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Speaker 3: is that there's no consensus on the definition of long

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Speaker 3: duration energy storage. BENIF defines it as a storage technology

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Speaker 3: that can offer disurgeration of at least six hours. However,

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Speaker 3: different sources define it in different ways. For example, the

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Speaker 3: US Department of Energy classifies long drage and energy storage

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Speaker 3: with duration of at least ten hours, while Chinese agencies

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Speaker 3: define it as four. So it really varies.

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Speaker 1: So the companies that are creating the technology for long

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Speaker 1: duration energy storage would not then classify themselves as long

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Speaker 1: duration energy storage providers necessarily because in many res they

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Speaker 1: may just be making batteries at how different applicability and

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Speaker 1: so is this is this an industry that I guess

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Speaker 1: largely look at each other as competitors and as technologies

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Speaker 1: that can be swapped out for each other or do

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Speaker 1: they have quite different use cases?

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Speaker 3: Well, they can have very different use cases. And again,

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Speaker 3: because we're talking about technologies that can offer anywhere between

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Speaker 3: six to twenty four to one hundred hours, they're really

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Speaker 3: very different applications that are fit for for these durations.

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Speaker 3: So many of these companies or technologies cannot be swapped

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Speaker 3: out directly and their success might be dependent on different parameters.

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Speaker 1: So we can talk about those different use cases as

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Speaker 1: we get into the technologies. And I think then the

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Speaker 1: question is, because there's no strict definition of what this

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Speaker 1: industry is, you had to make some choices regarding which

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Speaker 1: technologies you were going to look at, and you know

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Speaker 1: what those use cases were. So which technologies did you

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Speaker 1: decide to focus on and why did you pick them?

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Speaker 3: Well, in our work we covered of our of different technologies. Specifically,

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Speaker 3: we covered seven broad long duration energy storage technology groups

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Speaker 3: and twenty technology types under each of these, but broadly

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Speaker 3: you can think of lds based on major classifications such

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Speaker 3: as electrochemical, mechanical, or thermal. Electrochemical storage technologies basically store

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Speaker 3: energy through reversible chemical reactions. They're also typically referred to

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Speaker 3: as batteries, and the most widely widely known type of

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Speaker 3: battery that's electrochemicals lithium ion, but others include flow batteries.

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Speaker 3: Now with mechanical energy is stored through utilizing the physical

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Speaker 3: movement of materials to store and release energy, and examples

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Speaker 3: of these technologies include compressed air and liquid air energy storage,

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Speaker 3: gravity energy storage, compressed gas energy storage, and novel pumped

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Speaker 3: hydro at last pog least with thermal we have energy

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Speaker 3: stored through heat, so energy can be used for heating

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Speaker 3: or cooling and power generation later. And there are multiple

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Speaker 3: subcategories under thermal energy storage.

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Speaker 1: So oftentimes when we end up talking about on the

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Speaker 1: show or lithium ion batteries because invariably they're a source

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Speaker 1: of storage for the energy system, but also very much

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Speaker 1: in vehicles, which is another space that we cover. And

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Speaker 1: you know, we've just gone through a series of different

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Speaker 1: technologies that you looked at within these electrochemical, mechanical, and

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Speaker 1: thermal categories. Of those three categories, or if you want

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Speaker 1: to name a specific technology that works too, which ones

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Speaker 1: are most cost competitive with lithium ion batteries.

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Speaker 3: So when we're thinking about the cost competitiveness of long

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Speaker 3: duration energy storage technologies against lithium ion, there are multiple

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Speaker 3: ways to think about it. The costs really vary by

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Speaker 3: dissart duration, and it also really varies by by region.

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Speaker 3: While the typical storage duration for lithiumon batteries is two

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Speaker 3: to four hours, long duration energy storage technologies tend to

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Speaker 3: be more cost competitive over longer durations. So if we're

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Speaker 3: to look at that specific duration of two to four hours,

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Speaker 3: actually none of these long duration energy storage technologies is

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Speaker 3: really competitive. However, one of the very unique characteristics of

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Speaker 3: long duration energy storage is that the costs, specifically capital

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Speaker 3: costs drop at higher durations. That happens because the energy

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Speaker 3: and the power related components of these systems tend to

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Speaker 3: be decoupled versus this is not the case for lifiumion.

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Speaker 3: If we take an example of flow batteries, you can

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Speaker 3: increase the dis sharg duration of a system by adding

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Speaker 3: bigger tanks to store the liquid electrolyte versus in the

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Speaker 3: case of liftumine batteries, you would need to add more

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Speaker 3: battery cells. So for lds, this means that capital costs

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Speaker 3: drop for higher durations and they become more cost competitive

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Speaker 3: for these higher durations. The technologies that we've seen as

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Speaker 3: the most cost competitive for these higher durations tend to

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Speaker 3: be compressed air and thermal energy storage, and many of

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Speaker 3: these others might become cost competitive for longer durations.

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Speaker 1: Now in the storage market, specifically, the THEAMYA and you've

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Speaker 1: seen China be a really dominant force in terms of

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Speaker 1: really driving cost declines and producing its scale. And is

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Speaker 1: China also involved in some of these other technologies and

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Speaker 1: which ones are they most interested in?

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Speaker 2: Yeah, well, China has been leading the Lisima batteries because

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Speaker 2: of this massive adoption of lisa my batteries in both

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Speaker 2: electrical vehicle industry and also stationary energy storage markets. For

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Speaker 2: launderation storage, actually, China is also leading on that front

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Speaker 2: as well. So the technology deployment in China for launderation

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Speaker 2: storage is that generally cheaper compared to the rest of boards.

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Speaker 2: This is especially true for technologies such as compressed aian

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Speaker 2: gies storage and flow batteries, which China has considered them

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Speaker 2: as the major focus for now for the nature, so

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Speaker 2: most of those technologies actually at least fifteen percent cheaper

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Speaker 2: compared to those deployed in other markets. This is mainly

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Speaker 2: due to the more advanced commercial status of those technology

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Speaker 2: deployment in China compared to the rest of boards. So

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Speaker 2: while other nations are still trying to understand the value

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Speaker 2: of different launderation storages and also developing piloting projects, China

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Speaker 2: is starting to deploy those massive projects. We're seeing some

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Speaker 2: records setting large scale projects that has been developed in China.

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Speaker 2: Some of those are with gig wle hours scaled well,

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Speaker 2: but most of those projects deployed in the rest of

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Speaker 2: WOARLD is actually less than five macworld or less than

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Speaker 2: ten awards, so those are mainly those piloting projects. So

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Speaker 2: this massive adoption of laundrosan storage deployed in China has

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Speaker 2: been one of the major driver in driving down the

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Speaker 2: course of laundrotion storage in China currently.

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Speaker 1: And is it a fragmented market or are there a

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Speaker 1: few suppliers that are actually really heavily involved in some

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Speaker 1: of these specific technologies, because the parallel I think about

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Speaker 1: is the gigafactories that have risen in the luthium ion space,

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Speaker 1: and those are certainly very big projects focused on you know,

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Speaker 1: specific companies that you're doing them. So how fragmented or

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Speaker 1: consolidated is this market in China?

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Speaker 2: So lntruition storage is you're an emergent technology, so there

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Speaker 2: are some emergent companies entering into this market. For instance,

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Speaker 2: for flow batteries, we are seeing over thirty energy storage

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Speaker 2: system greater in this market, so this is quite a

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Speaker 2: large number. And this number is continuously increasing over time

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Speaker 2: as well. So I would say this is a quite

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Speaker 2: fragmented market for now, but over time on when the

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Speaker 2: market is mature, we're likely to see some consolidation or

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Speaker 2: some markets some companies may need to acceed markets ultimately

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Speaker 2: because of the fist competition and limited market size.

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Speaker 1: And how supportive is the policy environment in China towards

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Speaker 1: these technologies, because they've certainly been very supportive of lithiumyon

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Speaker 1: and of solar. Is this very much in the government sites.

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Speaker 2: As well, definitely, So the Chinese government has released multiple

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Speaker 2: policies driving the adoption of laundrousian storage since twenty twenty two.

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Speaker 2: So it has identified laundursion storage as one of the

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Speaker 2: key abler for its energy in netz zero transition by

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Speaker 2: twenty sixty. And also it has set its target to

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Speaker 2: reach early stage commercialization of nondrousion storage by twenty twenty

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Speaker 2: five and full commercialization by twenty thirty. So we are

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Speaker 2: seeing a large number of I think utility scale companies

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Speaker 2: and also great companies or provincial governments that's starting to

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Speaker 2: enter into this market and start to build those large

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Speaker 2: scale demonstration projects to get first move. And this has

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Speaker 2: been one of the major driver dropping the adoption of

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Speaker 2: laundrotion storage in China currently. In addition, China mandates a

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Speaker 2: certain amount of energy storage to be paired with new

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Speaker 2: build wind and solar projects, So this has been one

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Speaker 2: of the major driver of energy storage adoption in China currently,

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Speaker 2: and this applies to both short duration storage and laundurition storage.

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Speaker 2: So this has been meaningful I think policy in driving

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Speaker 2: the adoption of those laundroation storage in China.

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Speaker 1: Yeah, we really robust domestic market because the renewables industry

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Speaker 1: is taking off, so then this follows and complements it. Yeah,

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Speaker 1: which then leads me to are there other countries that

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Speaker 1: are also really keeping a close eye on this? And

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Speaker 1: I'm thinking about perhaps the US. We have the Inflation

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Speaker 1: Reduction Act that has put renewables on the map in

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Speaker 1: the US. Has that then also created a market for

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Speaker 1: long duration energy storage? And is there really anywhere in

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Speaker 1: the world that's looking like China.

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Speaker 3: At the moment?

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Speaker 2: So I think in nan Chinese markets, there's a growing

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Speaker 2: consensus in terms of the importance of laundrosians over time,

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Speaker 2: So many countries are calling for need of launchurition storage

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Speaker 2: as one of the key able for its energy transition

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Speaker 2: over time. But I would say most of the policies

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Speaker 2: support for from non Chinese markets are quite limited to date.

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Speaker 2: One of the major reasons is that most of the

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Speaker 2: projects in other markets are economic driven rather than policy driven.

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Speaker 2: So we needs strong financial incentives to drive those adoptions

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Speaker 2: of those projects in non Chinese markets. But I think

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Speaker 2: the financial incentives are quite limited to date, which is

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Speaker 2: not sufficient to drive the economic buildouts of laundrous storage

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Speaker 2: to date.

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Speaker 1: So you've already established that these are capital intensive projects

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Speaker 1: and in some cases very much right now. They are

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Speaker 1: not compelling from a cost standpoint in that they don't

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Speaker 1: pay for themselves. So we are certainly looking in an

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Speaker 1: industry that needs to be experiencing pretty dramatic cost declines

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Speaker 1: to have much wider deployment in the future without policy support.

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Speaker 1: Outside of China, though, where a lot of the support

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Speaker 1: for clean tech is often coming from the companies themselves

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Speaker 1: and they're looking for independent backing. You know, what is

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Speaker 1: the real driving force for long duration energy storage? Is

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Speaker 1: it actually policy in Europe or North America or is

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Speaker 1: it really coming from private industry and investors.

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Speaker 2: I think there are two types of revenue resource or

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Speaker 2: investment resources for launduration storage currently, so partially they come

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Speaker 2: from the government, So the Department of Energy of the

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Speaker 2: US is actually selecting a few technologies and provide funding

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Speaker 2: for those technologies to establish their demonstration projects. And on

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Speaker 2: the other hand, I think a lot of high profile

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Speaker 2: companies are receiving a lot of fundings from PBC firms.

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Speaker 2: We are interesting in developing the next twenty four to

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Speaker 2: seven clean firm technologies which can enable the future Nazero transition.

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Speaker 2: So actually we're seeing a surge of investment in laundering

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Speaker 2: storage since the past three years.

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Speaker 1: One of the things that Clerk Curry, who a lot

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Speaker 1: of the work that we have on the innovation side

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Speaker 1: of things, she pointed out that actually a quarter of

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Speaker 1: VC financing at this point in time is actually going

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Speaker 1: into clean technologies, and so this very much echoes the

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Speaker 1: fact that a lot of vcs have their strategy to

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Speaker 1: see some of these technologies where there is so much need,

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Speaker 1: hoping that in the future they will actually end up

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Speaker 1: getting much bigger and growing at scale.

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Speaker 2: And I think in addition, there are some corporate firms,

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Speaker 2: technology firms, big technology firms in US are highly interesting

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Speaker 2: in those technologies is one way to enable your twenty

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Speaker 2: four seven energies supply for their data centers such as Microsoft,

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Speaker 2: such as Google, all of those are actually looking to

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Speaker 2: developing those new technologies at their data center as well.

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Speaker 1: So companies that are actually really interested in decarbonizing are

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Speaker 1: leading the way and actually driving technology deployment.

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Speaker 2: Yes, it's currently I think those corporate firms investing significantly

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Speaker 2: in those new technologies, and they appear to be the

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Speaker 2: frame runner of this technology sector.

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Speaker 1: So at the beginning of the show, we talked about

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Speaker 1: how this really isn't a cohesive space, lots of different

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Speaker 1: definitions regarding what constitutes longeration energy storage to begin with,

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Speaker 1: and this is emerging tech. Well, there are some incumbent

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Speaker 1: technologies and we'll get to that because some of those

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Speaker 1: are becoming popular again. But in this world of emerging tech,

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Speaker 1: and we can continue to use China as the framework

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Speaker 1: to discuss this to begin with, But which technologies are

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Speaker 1: most cost competitive in China and perhaps some of the

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Speaker 1: ones that maybe are more cost competitive in other parts

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Speaker 1: of the world. Let's pick a couple sample technologies and

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Speaker 1: talk about them, and also talk about kind of the

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Speaker 1: mechanics we'll get into some of the mechanics of how

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Speaker 1: they work, because I think it would be nice for

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Speaker 1: us to have some sort of picture in our mind

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Speaker 1: of what some of this technology actually looks like in

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Speaker 1: the amount of space it takes up. So when we

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Speaker 1: first start thinking about this, I mean one of the

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Speaker 1: ones that I'm aware of is compressed gas. Can you

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Speaker 1: talk a little bit about compressed gas as a technology.

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Speaker 2: So in general of China is cheap of foremost relatively

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Speaker 2: too launche usion storage technologies, including compressed there and in

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Speaker 2: the flow batteries, which has been deployed since ninety seventies.

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Speaker 2: So it has been a long history of those technologies

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Speaker 2: and this is the major focus of China's currently. So

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Speaker 2: I would say most of those technology relatively material. Launduction

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Speaker 2: storage technologies are cheaper in China, are way more cost

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Speaker 2: competitive in China compared to the rest of awards. But

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Speaker 2: there are more laundrotion storage technology that are being developed

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Speaker 2: outside of China. Infecting our costs survey, we have received

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Speaker 2: cost data for over twenty different laundation storage technologies globally

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Speaker 2: and twenty yeah twenty, So most of those technologies that

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Speaker 2: developed outside of China including technologies that compressed gas or

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Speaker 2: other technologies which are just the emergent and their adoption

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Speaker 2: of those technologies in China are quite limited to date.

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Speaker 1: And what is the split between technologies that existed from

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Speaker 1: a while ago, so the nineteen seventies, like pumped hydro

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Speaker 1: or compressed gas versus new and like really properly new

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Speaker 1: technology that's emerged in let's say the last five to

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Speaker 1: ten years.

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Speaker 2: Yeah, I think among all a different launchrution stores technologists

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Speaker 2: compressed the guests and uncompressed area and the flow batteries

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Speaker 2: are too, Matio technologists. Other technologists are just emerging in

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Speaker 2: most of them are as piloting phase or on the face.

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Speaker 1: So many of them are actually in this piloting phase

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Speaker 1: of that twenty. Yes, I suppose there's something to be

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Speaker 1: said for with the older existing technologies, they've had some

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Speaker 1: time to ramp up, and then that would be the

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Speaker 1: reason that we're actually looking for some additional solutions that

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Speaker 1: can be used in a way that perhaps the existing

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Speaker 1: technologies can't. Okay, So Evelina, I did ask for some

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Speaker 1: sort of technical picture in my mind of a technology,

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Speaker 1: and there's one in particular that I would like to

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Speaker 1: know more about because I think the title of it

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Speaker 1: actually is really compelling. It's called supercritical CO two energy storage.

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Speaker 1: What is it and what does it look like?

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Speaker 3: Yeah, well maybe we need to go back to physics class,

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Speaker 3: and please no, So if we go back to our

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Speaker 3: physics class, the phase of materials depends on pressure and temperature,

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Speaker 3: and basically, with supercritical CO two, it's a fluid state

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Speaker 3: of carbon dioxide where it's held above its critical temperature

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Speaker 3: and critical pressure. So if you, for example, lower the pressure,

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Speaker 3: it becomes a gas, or if you lower the temperature,

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Speaker 3: it becomes a liquid. So the phase of material depends

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Speaker 3: ultimately on pressure and temperature, and for supercritical carbon dioxide

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Speaker 3: CO two, it's just a state where that material, or

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Speaker 3: that a substance, it's held at a temperature and pressure

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Speaker 3: above that critical point where distinct liquid and gas phases

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Speaker 3: do not exist.

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Speaker 1: So when I started working in this industry, renewables were

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Speaker 1: ninety percent hydro power, and as such, as someone who

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Speaker 1: perhaps wasn't very creative when approaching their master's thesis, I

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Speaker 1: decided to write my master's thesis about hydropower. So invariably

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Speaker 1: I have a personal interest in this, but additionally we

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Speaker 1: have a lot of aging infrastructure in that space, and

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Speaker 1: it has historically served as a source of kind of

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Speaker 1: a great source of flexibility and energy storage. And as

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Speaker 1: we are trying to increase the amount of renewables on

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Speaker 1: the grid and we are looking to new and old technologies,

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Speaker 1: I want to know a little bit about what potential

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Speaker 1: pump tydro has in the future of the storage space

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Speaker 1: and whether or not it will be a comeback story.

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Speaker 2: So I think palm tydro is indeed a very well

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Speaker 2: established technology and the destorage industry, and in fact, palm

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Speaker 2: hydro is the dominant technology besides lisima batdteries today. But

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Speaker 2: as we all know that developing pump tido could be

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Speaker 2: quite challenging both from the I think capital requirement perspective

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Speaker 2: and also the environmental impact perspective. In the addition, it

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Speaker 2: requires a very long time to get those projects developed.

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Speaker 2: But as we are seeing higher renewbal penetration growthing, there's

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Speaker 2: some renewed interest in palm taijo in markets such as China,

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Speaker 2: such as India, such as Europe such as Australia and others.

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Speaker 2: So there's indeed a comeback story of pump tijo but

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Speaker 2: there are some challenges associated with developing those green field

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Speaker 2: projects globally. To date, most of those activities actually in China.

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Speaker 1: Again, so there's the new projects, but then there's the

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Speaker 1: aging infrastructure. Is that something that people are looking at

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Speaker 1: in close detail and when we're then repairing and retrofitting

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Speaker 1: existing pump hydro projects, is there new technology within that

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Speaker 1: like best available technology that's moving in or is that

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Speaker 1: space not really changed a lot in the last several decades.

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Speaker 2: In fact, we are seeing some new pump tido technologies

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Speaker 2: or we called novel pump tydo technologies, so we have

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Speaker 2: actually collected some cost data for those projects as well.

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Speaker 2: So one of the I think high profile technology is

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Speaker 2: called high density pump tijo. So instead of using water

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Speaker 2: as a storage medium, this type of new technology used

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Speaker 2: flud with higher density than water, so this allows a

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Speaker 2: lower elevation and smaller footprints required to deliver a similar

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Speaker 2: amount of energy compared to those conventional ones. However, most

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Speaker 2: of those novel pump ygo technologists, as you, very early

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Speaker 2: stage of developments and most of those technology will be

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Speaker 2: developed by twenty thirty, so it's not a neutron story.

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Speaker 1: So let's jump in on another technology that is of

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Speaker 1: interest at the moment, So gravity energy storage. I like

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Speaker 1: the name of this one too, just because it has

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Speaker 1: gravity in the name. Talk to me about gravity energy storage.

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Speaker 1: What is it and kind of what is the potential?

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Speaker 3: Well. Gravity energy storage is another technology that is gaining

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Speaker 3: a lot of attention in use and media, primarily also

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Speaker 3: because it's very different from a lot of the electrochemical

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Speaker 3: solutions that were used to and seen in the past.

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Speaker 3: The way it works is by using energy to raise mass,

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Speaker 3: storing energy and potential energy by maintaining it elevated, and

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Speaker 3: then dropping it and releasing that energy when they want

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Speaker 3: to release the energy back to the grid. So it

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Speaker 3: basically uses electricity or energy to lift these masses when

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Speaker 3: prices are low, and then lower it when prices are

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Speaker 3: are high or where energy is needed to discharge it

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Speaker 3: in the grid. There are many advantages to gravity energy storage,

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Speaker 3: but also quite a lot of drawbacks. One of the

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Speaker 3: advantages is that the design is relatively simple. It's mechanical,

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Speaker 3: so it also has a long lifetime. These systems tend

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Speaker 3: to have a long lifetime because their life depends on

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Speaker 3: the lifetime of mechanical components. Which are generally pretty advanced.

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Speaker 3: They don't degrade, and we were quite familiar with it

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Speaker 3: because they're also used in other industries. However, drawbacks include

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Speaker 3: low round trip efficiency and very significant physical footprints, so

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Speaker 3: you needed a lot of space for such systems, so

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Speaker 3: it makes citing them and finding appropriate locations for them

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Speaker 3: quite difficult.

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Speaker 1: So another issue with land use. But what does low

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Speaker 1: round trip efficiency mean?

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Speaker 3: Basically means that you need to put more energy into

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Speaker 3: charging it and you get less energy out of it,

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Speaker 3: so you have a lot of energy losses while charging

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Speaker 3: and discharging.

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Speaker 1: Yeah, it's for fear of stating the obvious batteries in

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Speaker 1: many respects and well hydrogen actually being one of those

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Speaker 1: things where there are use cases for it, but it

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Speaker 1: takes energy to make energy is energy storage invariably, there's

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Speaker 1: so much that we have to put into it in

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Speaker 1: order for it to be effective. And then it's that

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Speaker 1: ratio right on what it is that you actually get

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Speaker 1: out of it when you need it and for how long.

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Speaker 1: So nothing is a perfect solution. Everything fits to a

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Speaker 1: specific use case and in this case enabling renewables. So

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Speaker 1: I want to circle back on cost because cost is

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Speaker 1: an important part of deployment of any technology. And if

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Speaker 1: we think about China where they are actively supporting long

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Speaker 1: duration energy storage co located with renewables, and you're seeing

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Speaker 1: this roll out happening, what kind of percentage or even

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Speaker 1: in absolute terms, what are we seeing in terms of

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Speaker 1: cost for this overall project. Is it a really big

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Speaker 1: financial part of it or is it something that's sort

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Speaker 1: of a no brainer and it's pretty obvious that you

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Speaker 1: would want to include it because building over capacity is

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Speaker 1: going to be so much more expensive.

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Speaker 2: I think it's how to get and some projects, but

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Speaker 2: I think in general it would be most of the

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Speaker 2: developers in channel will struggle to collect sufficient revenue streams

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Speaker 2: for laundursion storage to cover your initial costs. So most

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Speaker 2: of those projects are not actually economically stupn or not

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Speaker 2: economically viable in China.

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Speaker 1: Over a long period of time, Like the payback on

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Speaker 1: the capital expenditure will not come back on this specific

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Speaker 1: part of it.

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Speaker 2: It's hard to say for now because most of those

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Speaker 2: Laundusian storage startups or companies that claim me very ambitious

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Speaker 2: cost reduction targets. It's applicable to anyone in the industry,

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Speaker 2: but I think it's remains to be seen how cost

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Speaker 2: effectively der technology can ultimately become and.

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Speaker 3: If I can add something. There may be two ways

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Speaker 3: to think of costs. The way that we looked at

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Speaker 3: it for this work that we put out was in

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Speaker 3: terms of capital costs, but another way to look at

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Speaker 3: it is in terms of level life's cost of electricity.

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Speaker 3: So what we focus on this report is capital costs,

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Speaker 3: so basically the cost of a fully installed system. That's

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Speaker 3: the first step into making analysis. That's a major input

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Speaker 3: into levelized costs of electricity, which we're going to be

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Speaker 3: doing as well for these technologies, so we'lltch out for that.

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Speaker 3: But generally, while levelized costs of electricity might make some

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Speaker 3: of these technologies look more cost competitive, many investors might

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Speaker 3: hesitate to use it as a metric because the lifetimes

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Speaker 3: of these projects are very, very long, and we're talking

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Speaker 3: about long payback periods. So capital cost remains a very

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Speaker 3: important metric. But it's important to mention that they're both

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Speaker 3: and different companies and different agencies might be using both,

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Speaker 3: and they're both helpful in making decisions and evaluating these technologies.

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Speaker 1: So, because this is certainly an emerging technology space, if

439
00:23:42,440 --> 00:23:46,280
Speaker 1: we look away from the established technologies that have a

440
00:23:46,359 --> 00:23:48,360
Speaker 1: new life potentially in front of them, and we look

441
00:23:48,359 --> 00:23:51,080
Speaker 1: at some of the more emerging technologies. You have choices

442
00:23:51,080 --> 00:23:53,119
Speaker 1: to make regarding your time. I used to ask this

443
00:23:53,200 --> 00:23:55,159
Speaker 1: question actually quite frequently on the show. So I'm going

444
00:23:55,200 --> 00:23:57,399
Speaker 1: to bring back a favorite question type of mind, which

445
00:23:57,440 --> 00:23:59,679
Speaker 1: is use the export. What are you watching and what

446
00:23:59,720 --> 00:24:02,320
Speaker 1: are you ignoring? At least for right now. You can

447
00:24:02,320 --> 00:24:04,359
Speaker 1: always change your mind next time you come on the show.

448
00:24:04,480 --> 00:24:07,600
Speaker 1: Are you watching or ignoring sodium sulfur batteries?

449
00:24:08,160 --> 00:24:10,959
Speaker 3: Yes, it's definitely one of the technologies that we're looking at.

450
00:24:11,000 --> 00:24:12,960
Speaker 3: And a good way maybe to frame it is that

451
00:24:13,080 --> 00:24:15,160
Speaker 3: we keep an eye on all of these long duration

452
00:24:15,280 --> 00:24:17,520
Speaker 3: and restorage technologies, and there are many that maybe we

453
00:24:17,560 --> 00:24:20,520
Speaker 3: didn't have the chance to talk about today. These include

454
00:24:20,640 --> 00:24:23,520
Speaker 3: sodium sulfur like you mentioned, and because they make a

455
00:24:23,600 --> 00:24:26,879
Speaker 3: smaller share in terms of deployments, maybe they're not the

456
00:24:26,920 --> 00:24:30,720
Speaker 3: center focus of attention. So I wouldn't want to count

457
00:24:30,720 --> 00:24:33,200
Speaker 3: any of them out, or just maybe paying less attention

458
00:24:33,240 --> 00:24:36,639
Speaker 3: and focusing on the metric of deployment in terms of

459
00:24:36,680 --> 00:24:38,080
Speaker 3: how we would split our time.

460
00:24:38,200 --> 00:24:39,800
Speaker 1: So you're not ignoring them, but they don't get their

461
00:24:39,800 --> 00:24:41,800
Speaker 1: own research note, yet it's the right way to put it.

462
00:24:41,840 --> 00:24:45,240
Speaker 3: Not yet. Okay, we look forward and we're excited to

463
00:24:45,240 --> 00:24:48,080
Speaker 3: see new technologies gaining traction so that we can write

464
00:24:48,200 --> 00:24:49,240
Speaker 3: reports about all of them.

465
00:24:49,480 --> 00:24:52,560
Speaker 1: So how about liquid metal batteries another name that I

466
00:24:52,600 --> 00:24:55,159
Speaker 1: just love. This is the show of favorite names for

467
00:24:55,240 --> 00:24:57,480
Speaker 1: me for some reason. But liquid metal batteries, you know,

468
00:24:57,520 --> 00:24:59,560
Speaker 1: how close are they to getting their own research note?

469
00:25:00,080 --> 00:25:02,720
Speaker 3: Again, they're probably in that category that they can't get

470
00:25:02,760 --> 00:25:05,440
Speaker 3: their own research note yet. If we're to define them,

471
00:25:05,440 --> 00:25:08,960
Speaker 3: they operate using liquid electrolytes, with a defining characteristic being

472
00:25:09,040 --> 00:25:11,919
Speaker 3: a molten salt electrolyte. But again, maybe they don't have

473
00:25:12,320 --> 00:25:13,520
Speaker 3: a note on them yet.

474
00:25:13,680 --> 00:25:16,960
Speaker 1: And then another one that is an emerging technology. Tell

475
00:25:17,000 --> 00:25:19,840
Speaker 1: me a little bit about sodium iron chloride batteries.

476
00:25:20,320 --> 00:25:24,280
Speaker 3: So it's another type of high temperature rechargeable battery. Again

477
00:25:24,320 --> 00:25:27,000
Speaker 3: it's grouped in one of these other technologies that we

478
00:25:27,520 --> 00:25:30,600
Speaker 3: didn't have enough data points to get their own section.

479
00:25:30,960 --> 00:25:33,920
Speaker 3: But another technology that we look out for.

480
00:25:34,200 --> 00:25:36,520
Speaker 1: Not enough data points then means the world is not

481
00:25:36,640 --> 00:25:39,080
Speaker 1: yet putting it all together. That we may see as

482
00:25:39,320 --> 00:25:42,080
Speaker 1: more projects come to light and ability to analyze it further.

483
00:25:42,320 --> 00:25:45,600
Speaker 1: I want to know on this spectrum of how long

484
00:25:45,720 --> 00:25:49,120
Speaker 1: that energy can be stored for which one has the

485
00:25:49,240 --> 00:25:53,119
Speaker 1: longest duration energy storage? And then within this definition of

486
00:25:53,200 --> 00:25:55,520
Speaker 1: just you know China, in some cases saying only four

487
00:25:55,520 --> 00:25:58,880
Speaker 1: hours is necessary to be classified as long duration energy storage,

488
00:25:58,880 --> 00:26:01,960
Speaker 1: what is the least long duration and what is the

489
00:26:02,000 --> 00:26:03,719
Speaker 1: most long duration technology?

490
00:26:03,960 --> 00:26:06,400
Speaker 3: Yeah, maybe we can give some context in terms of

491
00:26:06,440 --> 00:26:08,560
Speaker 3: the data points that we're received to give you a

492
00:26:08,600 --> 00:26:11,359
Speaker 3: sense of where we see the most need in terms

493
00:26:11,359 --> 00:26:15,520
Speaker 3: of durations. So about forty percent of the data points

494
00:26:15,560 --> 00:26:18,480
Speaker 3: that we collected were actually four dishort durations of one

495
00:26:18,480 --> 00:26:21,399
Speaker 3: to four hours, and then forty two percent was for

496
00:26:21,440 --> 00:26:24,240
Speaker 3: a dishort duration between five and ten hours. So we

497
00:26:24,320 --> 00:26:28,360
Speaker 3: have a majority of the data representing technologies and projects

498
00:26:28,440 --> 00:26:30,960
Speaker 3: that are between one and ten hours. This means that

499
00:26:31,000 --> 00:26:35,679
Speaker 3: the industry is still moving and around that duration phase

500
00:26:35,920 --> 00:26:38,639
Speaker 3: just because one many of them are early stage, so

501
00:26:38,680 --> 00:26:41,560
Speaker 3: it makes more sense to do a smaller project for

502
00:26:42,240 --> 00:26:45,879
Speaker 3: a shorter duration to prove it as a concept. And

503
00:26:45,920 --> 00:26:49,280
Speaker 3: another key reason that we're seeing shorter durations is because

504
00:26:49,280 --> 00:26:53,920
Speaker 3: that's the need we're currently seeing. So as Ye previously mentioned,

505
00:26:54,000 --> 00:26:57,639
Speaker 3: there's not a lot of policy supporting long duration in

506
00:26:57,720 --> 00:27:03,200
Speaker 3: many markets beyond these that we're seeing that I previously mentioned,

507
00:27:03,240 --> 00:27:06,439
Speaker 3: and there's not a way that these storing energy for

508
00:27:06,480 --> 00:27:09,800
Speaker 3: long durations is compensated in energy systems such as in

509
00:27:09,840 --> 00:27:12,040
Speaker 3: the US. That's one of the reasons that we're seeing

510
00:27:12,200 --> 00:27:15,840
Speaker 3: a shorter duration. And within each of these durations, there

511
00:27:15,880 --> 00:27:18,680
Speaker 3: are different technologies that might be competing. For example, thermal

512
00:27:18,760 --> 00:27:22,199
Speaker 3: energy storage typically makes sense for higher durations, so you

513
00:27:22,280 --> 00:27:26,399
Speaker 3: might see more thermo energy storage projects for higher durations.

514
00:27:26,640 --> 00:27:29,520
Speaker 1: What's the maximum number of hours a thermal energy storage

515
00:27:29,560 --> 00:27:30,240
Speaker 1: project could do.

516
00:27:30,560 --> 00:27:34,679
Speaker 3: So it really varies. We can see durations up to

517
00:27:34,760 --> 00:27:37,880
Speaker 3: twenty four hours, so from the data point that we collected,

518
00:27:37,920 --> 00:27:41,040
Speaker 3: in addition to costs, we ask people about different performance

519
00:27:41,119 --> 00:27:45,200
Speaker 3: metrics including duration and thermal energy storage could really vary

520
00:27:45,240 --> 00:27:47,720
Speaker 3: between two to four hours up to twenty.

521
00:27:47,400 --> 00:27:49,680
Speaker 1: Four So some of these technologies, if I really put

522
00:27:49,720 --> 00:27:52,199
Speaker 1: it simply, are being used as speakers. Meanwhile, others are

523
00:27:52,240 --> 00:27:55,480
Speaker 1: actually being used for let's say, night time energy for

524
00:27:55,880 --> 00:27:59,360
Speaker 1: solar or for changes to weather patterns. When we're thinking

525
00:27:59,359 --> 00:28:02,520
Speaker 1: about other parts the renewables as opposed to being plugged

526
00:28:02,560 --> 00:28:06,120
Speaker 1: in for peak demand. Yes, but both use cases are

527
00:28:06,359 --> 00:28:08,000
Speaker 1: valid within this launderation.

528
00:28:08,119 --> 00:28:08,880
Speaker 3: Energy storage.

529
00:28:09,119 --> 00:28:12,480
Speaker 2: It highly depends, so we are seeing companies developing for

530
00:28:12,600 --> 00:28:15,760
Speaker 2: hours up to one hundred hours more launderation storage, so.

531
00:28:15,920 --> 00:28:18,119
Speaker 1: What can do one hundred hours.

532
00:28:17,960 --> 00:28:20,040
Speaker 2: Some companies, I think one of the I think most

533
00:28:20,359 --> 00:28:23,320
Speaker 2: high profile companies called form Energy, which is a startup

534
00:28:23,400 --> 00:28:26,480
Speaker 2: in the US, is actually developing the iron air technology

535
00:28:26,560 --> 00:28:29,560
Speaker 2: that can serve duration over one hundred hours. And I

536
00:28:29,560 --> 00:28:31,959
Speaker 2: think one of the major use case of those technologies

537
00:28:32,080 --> 00:28:35,800
Speaker 2: are actually pelling with renewable projects to turn the renewables

538
00:28:35,800 --> 00:28:39,400
Speaker 2: into the round the clock electricity supply and they can

539
00:28:39,480 --> 00:28:42,200
Speaker 2: display the core and gas pop plants, and also they

540
00:28:42,240 --> 00:28:45,760
Speaker 2: can also defer the great investments in some markets or

541
00:28:45,800 --> 00:28:49,239
Speaker 2: some region. Actually, we're seeing quite some projects that are

542
00:28:49,280 --> 00:28:52,520
Speaker 2: being developed by this company in the US. Actually, some

543
00:28:52,640 --> 00:28:55,640
Speaker 2: utilities are very interesting in such kind of technologies as

544
00:28:55,680 --> 00:28:58,800
Speaker 2: one of the I think promising options to displace those

545
00:28:58,960 --> 00:29:01,680
Speaker 2: Asian core and the guess power plants. So this is

546
00:29:01,720 --> 00:29:03,720
Speaker 2: one of the I think major use case we are

547
00:29:03,760 --> 00:29:07,400
Speaker 2: seeing for those and new storage. But oftentimes we are

548
00:29:07,400 --> 00:29:09,840
Speaker 2: seeing a lot lot of intro day and new storage,

549
00:29:09,840 --> 00:29:12,960
Speaker 2: so duration with six up to twelve hours, so they're

550
00:29:12,960 --> 00:29:17,280
Speaker 2: actually paired with solar assets to generate elegacy during the

551
00:29:17,320 --> 00:29:20,040
Speaker 2: evening peak and also over the nighttime, So this is

552
00:29:20,080 --> 00:29:23,840
Speaker 2: another dominating usage of I think lun duration storage use

553
00:29:23,880 --> 00:29:24,960
Speaker 2: case currently we are seeing.

554
00:29:25,320 --> 00:29:27,240
Speaker 1: I mean, I know you've both said that the majority

555
00:29:27,240 --> 00:29:29,560
Speaker 1: of the market is at these kind of single digit

556
00:29:29,640 --> 00:29:32,600
Speaker 1: to kind of low double digit numbers of hours, but

557
00:29:32,720 --> 00:29:35,880
Speaker 1: I find the one hundred hour use case to be

558
00:29:36,160 --> 00:29:40,040
Speaker 1: incredibly interesting and will be watching that so closely because

559
00:29:40,240 --> 00:29:43,760
Speaker 1: to your point, it's not about these technologies competing with

560
00:29:43,800 --> 00:29:46,320
Speaker 1: one another for market share. It's actually about how they

561
00:29:46,360 --> 00:29:51,760
Speaker 1: can displace existing legacy energy like gues so ye ye. Evelina,

562
00:29:51,920 --> 00:29:54,240
Speaker 1: thank you so much for joining today and talking about

563
00:29:54,280 --> 00:29:58,760
Speaker 1: this really rapidly evolving space with so much potential and

564
00:29:59,120 --> 00:30:02,320
Speaker 1: necessity for the rollout of renewables deployment.

565
00:30:02,560 --> 00:30:03,960
Speaker 2: Thank you Dana for having us.

566
00:30:04,160 --> 00:30:04,800
Speaker 3: Thank you, Dania.

567
00:30:13,920 --> 00:30:17,040
Speaker 1: Today's episode of Switched On was produced by Cam Gray

568
00:30:17,280 --> 00:30:20,920
Speaker 1: with production assistance from Kamala Shelling. Bloomberg NIF is a

569
00:30:20,960 --> 00:30:24,080
Speaker 1: service provided by Bloomberg Finance LP and its affiliates. This

570
00:30:24,200 --> 00:30:26,880
Speaker 1: recording does not constitute, nor should it be construed as

571
00:30:26,920 --> 00:30:30,840
Speaker 1: investment advice, investment recommendations, or a recommendation as to an

572
00:30:30,880 --> 00:30:34,080
Speaker 1: investment or other strategy. Bloomberg ANIF should not be considered

573
00:30:34,080 --> 00:30:37,400
Speaker 1: as information sufficient upon which to base an investment decision.

574
00:30:37,480 --> 00:30:40,440
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575
00:30:40,480 --> 00:30:44,240
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