1 00:00:00,200 --> 00:00:02,680 Speaker 1: This is Dana Perkins and you're listening to Switch on 2 00:00:02,880 --> 00:00:05,840 Speaker 1: the b NEF podcast. If you've listened to the show before, 3 00:00:06,200 --> 00:00:08,920 Speaker 1: you'll know that we at BNF spend a lot of 4 00:00:08,960 --> 00:00:12,160 Speaker 1: time talking about the future. After all, it's a huge 5 00:00:12,200 --> 00:00:15,319 Speaker 1: part of the discussion around climate. People are thinking about 6 00:00:15,320 --> 00:00:17,759 Speaker 1: what a warmer world might look like, how warm is 7 00:00:17,800 --> 00:00:20,200 Speaker 1: it actually going to get, How much carbon budget do 8 00:00:20,239 --> 00:00:22,720 Speaker 1: we have left to spend between now and X date 9 00:00:22,760 --> 00:00:25,959 Speaker 1: in the future. The net zero targets discussed to copy 10 00:00:26,000 --> 00:00:30,480 Speaker 1: six or by companies or by countries are inherently forward looking. 11 00:00:30,800 --> 00:00:33,199 Speaker 1: So one of the most forward looking teams we have 12 00:00:33,280 --> 00:00:36,560 Speaker 1: at BIENF is the energy economics team, or perhaps I 13 00:00:36,600 --> 00:00:39,479 Speaker 1: should just say that they look the furthest out because 14 00:00:39,640 --> 00:00:42,120 Speaker 1: they build different scenarios that go out to the year 15 00:00:43,360 --> 00:00:46,800 Speaker 1: between now and If certain versions of the future could 16 00:00:46,880 --> 00:00:49,680 Speaker 1: be true, what steps might need to be taken to 17 00:00:49,840 --> 00:00:53,440 Speaker 1: make them true. Enter scenario analysis, which I think I 18 00:00:53,560 --> 00:00:56,040 Speaker 1: just oversimplified and had a bit of a tendency to do. 19 00:00:56,200 --> 00:00:59,480 Speaker 1: In today's show. Today I speak with sebhend Best, who 20 00:00:59,560 --> 00:01:02,080 Speaker 1: is the chief economist at BNF, and he's also the 21 00:01:02,160 --> 00:01:05,480 Speaker 1: chief author of our new energy Outlook. Now if I 22 00:01:05,480 --> 00:01:07,600 Speaker 1: put it in another way, he's the guy who leads 23 00:01:07,640 --> 00:01:10,920 Speaker 1: our team of forward thinkers. We talk about the New 24 00:01:11,000 --> 00:01:14,800 Speaker 1: Energy Outlook and within it our energy Transition scenario, as 25 00:01:14,800 --> 00:01:18,200 Speaker 1: well as three new net zero scenarios that were introduced 26 00:01:18,200 --> 00:01:20,240 Speaker 1: earlier this year. If you want to read our New 27 00:01:20,319 --> 00:01:22,760 Speaker 1: Energy Outlook, you can find it at be enough, go 28 00:01:22,920 --> 00:01:25,840 Speaker 1: on the Bloomberg terminal, or on benof dot com. A 29 00:01:25,920 --> 00:01:28,800 Speaker 1: quick reminder, we do not provide investment strategy advice, and 30 00:01:28,840 --> 00:01:30,880 Speaker 1: our full disclaimer is at the end of the show. 31 00:01:31,560 --> 00:01:43,039 Speaker 1: But for now, let's speak with Seb about the future. Seb, 32 00:01:43,120 --> 00:01:45,680 Speaker 1: thank you for joining today, pleasure, thanks for having me. 33 00:01:46,120 --> 00:01:49,400 Speaker 1: So we are going to talk about benf new Energy Outlook, 34 00:01:50,040 --> 00:01:52,160 Speaker 1: and we're also going to talk about some net zero 35 00:01:52,600 --> 00:01:55,360 Speaker 1: scenarios that we did that were an expansion on that 36 00:01:55,400 --> 00:01:58,360 Speaker 1: this year. But let's first dig into what is the 37 00:01:58,360 --> 00:02:00,800 Speaker 1: New Energy Outlook we lovingly call NEO. But what is 38 00:02:00,800 --> 00:02:02,840 Speaker 1: the New Energy Outlook and what's it hoping to achieve? 39 00:02:03,040 --> 00:02:05,600 Speaker 1: Great question, right, what is it? It's a big study 40 00:02:05,800 --> 00:02:09,799 Speaker 1: and it's designed to pull together all the energy analysis 41 00:02:09,880 --> 00:02:12,679 Speaker 1: that we do across B and e F into long 42 00:02:12,800 --> 00:02:16,680 Speaker 1: term scenarios, trying to understand what the future energy economy 43 00:02:16,880 --> 00:02:20,280 Speaker 1: might look like. So it's a scenario exercise and we 44 00:02:20,320 --> 00:02:24,080 Speaker 1: do it annually and it's about six people pulling their 45 00:02:24,120 --> 00:02:29,840 Speaker 1: brains together to hopefully join the dots and provide insight 46 00:02:30,000 --> 00:02:32,840 Speaker 1: into how all the changes that we're looking at and 47 00:02:32,880 --> 00:02:37,960 Speaker 1: tracking on a day to day basis manifest into for 48 00:02:38,000 --> 00:02:41,680 Speaker 1: those of you who are interested in detail, well maybe 49 00:02:41,680 --> 00:02:44,000 Speaker 1: not super deep detail, but detail on how we go 50 00:02:44,040 --> 00:02:46,040 Speaker 1: about modeling in their approach to this. We actually have 51 00:02:46,040 --> 00:02:49,960 Speaker 1: another podcast by a colleague of subs, Mattias, who goes 52 00:02:50,000 --> 00:02:52,280 Speaker 1: into that, but today we're going to talk about more 53 00:02:52,480 --> 00:02:55,480 Speaker 1: the findings and what this tells us about the future. 54 00:02:55,960 --> 00:02:58,440 Speaker 1: Now we have this outlook, when is the last time 55 00:02:58,480 --> 00:03:02,040 Speaker 1: that we did this, So that twenty one New Energy 56 00:03:02,080 --> 00:03:05,120 Speaker 1: Outlook came out in July, and we do it once 57 00:03:05,160 --> 00:03:08,040 Speaker 1: a year before that, it was actually October, so the 58 00:03:08,040 --> 00:03:11,320 Speaker 1: publication date changes somewhat, but it's an annual exercise and 59 00:03:11,360 --> 00:03:15,200 Speaker 1: every year we try and make it insightful and keep 60 00:03:15,240 --> 00:03:17,639 Speaker 1: pushing the boundary getting to the you know, the real 61 00:03:17,880 --> 00:03:21,200 Speaker 1: cold face if you excuse the pun, of the really 62 00:03:21,240 --> 00:03:25,079 Speaker 1: big transition questions as we look around the world. So 63 00:03:25,200 --> 00:03:27,200 Speaker 1: when we look at this year, we did a couple 64 00:03:27,240 --> 00:03:30,160 Speaker 1: of different things and we looked at net zero pathways. 65 00:03:30,320 --> 00:03:32,680 Speaker 1: Can you just explain what that means. We will get 66 00:03:32,760 --> 00:03:35,040 Speaker 1: into the detail of it in a couple of minutes, 67 00:03:35,080 --> 00:03:38,280 Speaker 1: but what are the net zero pathways this year hoping 68 00:03:38,320 --> 00:03:40,640 Speaker 1: to achieve? Let me take a step back and just 69 00:03:40,760 --> 00:03:44,160 Speaker 1: explain a little bit about scenarios a set of which 70 00:03:44,280 --> 00:03:47,960 Speaker 1: are these net zero pathways. And it's important to recognize 71 00:03:48,000 --> 00:03:52,120 Speaker 1: the difference between a scenario and a forecast. A forecast 72 00:03:52,200 --> 00:03:54,440 Speaker 1: is a prediction we're saying what we think will happen. 73 00:03:54,840 --> 00:03:58,520 Speaker 1: A scenario is different in the sense that it generally 74 00:03:58,560 --> 00:04:01,280 Speaker 1: looks much further out, and trying to build a picture 75 00:04:01,320 --> 00:04:06,160 Speaker 1: of the future in extreme uncertainty with complex dynamics that 76 00:04:06,240 --> 00:04:08,520 Speaker 1: we can use as an anchor to help us make 77 00:04:08,560 --> 00:04:12,600 Speaker 1: decisions and take big bets. So we're not trying to 78 00:04:12,640 --> 00:04:17,200 Speaker 1: predict the future here, we're trying to present plausible pathways. 79 00:04:17,279 --> 00:04:21,280 Speaker 1: And for the energy transition, there's a lot of uncertainty, 80 00:04:21,360 --> 00:04:25,000 Speaker 1: and so we could build loads of different types of scenarios. 81 00:04:25,600 --> 00:04:28,200 Speaker 1: None of them are wrong, none of them are right, 82 00:04:28,279 --> 00:04:29,880 Speaker 1: none of them are true, none of them are false. 83 00:04:30,120 --> 00:04:33,599 Speaker 1: It's just whether they're useful or not useful. And so 84 00:04:33,720 --> 00:04:38,880 Speaker 1: in near one we developed three different pathways to a 85 00:04:39,000 --> 00:04:44,159 Speaker 1: net zero emissions economy for the energy sector. And there's 86 00:04:44,240 --> 00:04:46,200 Speaker 1: just lots of different ways to get there. So we 87 00:04:46,240 --> 00:04:49,480 Speaker 1: had to make some decisions about what were the technology 88 00:04:49,520 --> 00:04:52,720 Speaker 1: mixes that we wanted to investigate that we thought our 89 00:04:52,760 --> 00:04:55,920 Speaker 1: clients and our readers would find most insightful and most 90 00:04:56,000 --> 00:04:59,160 Speaker 1: useful as they're making decisions, you know, within this transition. 91 00:04:59,440 --> 00:05:03,159 Speaker 1: So we produce three different pathways. We called one the 92 00:05:03,240 --> 00:05:06,919 Speaker 1: green scenario, we called one the red scenario, we called 93 00:05:06,920 --> 00:05:09,640 Speaker 1: one the gray scenario. All of them have lots of 94 00:05:09,680 --> 00:05:12,280 Speaker 1: renewable energy and electric vehicles and the things that we 95 00:05:12,320 --> 00:05:16,640 Speaker 1: can see happening now. But the scenarios differ by sort 96 00:05:16,680 --> 00:05:18,920 Speaker 1: of the second phase. If you're like, well, we call 97 00:05:19,000 --> 00:05:22,520 Speaker 1: phase two technologies. Are we talking about hydrogen, are we 98 00:05:22,600 --> 00:05:26,679 Speaker 1: talking about carbon capture applications? Are we talking about maybe 99 00:05:26,720 --> 00:05:30,560 Speaker 1: small nuclear reactors? How do we get to zero? And 100 00:05:30,560 --> 00:05:33,080 Speaker 1: there are some pretty fundamental questions about what we might 101 00:05:33,160 --> 00:05:36,479 Speaker 1: need to see over the next thirty years to get there. 102 00:05:36,720 --> 00:05:39,880 Speaker 1: Let's talk a little bit about scenarios because these are 103 00:05:39,960 --> 00:05:43,320 Speaker 1: not new to the industry. Lots of organizations do this 104 00:05:44,120 --> 00:05:46,680 Speaker 1: how do the net zero scenarios that we've looked at 105 00:05:46,720 --> 00:05:49,680 Speaker 1: and our approach to looking at net zero, how does 106 00:05:49,720 --> 00:05:53,200 Speaker 1: it maybe map onto or inter relate with the Intergovernmental 107 00:05:53,200 --> 00:05:55,080 Speaker 1: Panel on Climate Change or the i p c c 108 00:05:55,320 --> 00:05:58,960 Speaker 1: S warming scenarios. Yeah, there are certainly lots and lots 109 00:05:59,000 --> 00:06:02,880 Speaker 1: of scenarios out there, and it's pretty difficult actually to 110 00:06:03,040 --> 00:06:06,960 Speaker 1: know which wants to read how to interpret them relative 111 00:06:07,000 --> 00:06:09,760 Speaker 1: to one another. It's not straightforward. I mean, there's a big, 112 00:06:09,800 --> 00:06:13,560 Speaker 1: big complex exercises and it gets a bit inside baseball 113 00:06:13,760 --> 00:06:17,040 Speaker 1: in terms of how they differ, why they differ. There 114 00:06:17,080 --> 00:06:20,320 Speaker 1: are some well known scenarios that are used. Perhaps the 115 00:06:20,360 --> 00:06:22,600 Speaker 1: most important from a climate perspective are the ones that 116 00:06:22,640 --> 00:06:25,360 Speaker 1: the Intergovernmental Panel and Climate Change put together, because what 117 00:06:25,440 --> 00:06:28,640 Speaker 1: they essentially do for all the other economic modelers out 118 00:06:28,640 --> 00:06:32,240 Speaker 1: there who are building scenarios to help them make decisions 119 00:06:32,279 --> 00:06:35,920 Speaker 1: is they provide us with a relationship between the amount 120 00:06:35,960 --> 00:06:38,640 Speaker 1: of greenhouse gases and the atmosphere and the impact on 121 00:06:38,680 --> 00:06:44,720 Speaker 1: the climate. And so often when we're describing climate objectives 122 00:06:44,800 --> 00:06:47,039 Speaker 1: in terms of degrees, we need to understand how many 123 00:06:47,040 --> 00:06:50,400 Speaker 1: emissions that means, and then we have to turn that 124 00:06:50,440 --> 00:06:53,440 Speaker 1: into a budget, a carbon budget which we can then 125 00:06:53,480 --> 00:06:57,400 Speaker 1: operate within, and the difference between scenarios is often the 126 00:06:57,480 --> 00:07:00,280 Speaker 1: definition of that budget, how many miss and have we 127 00:07:00,320 --> 00:07:03,040 Speaker 1: got to work with, and how that budget is then 128 00:07:03,080 --> 00:07:06,880 Speaker 1: divided up by different sectors and different countries, and then 129 00:07:06,880 --> 00:07:11,880 Speaker 1: which technologies or pathways might be employed within the scenario 130 00:07:12,200 --> 00:07:17,040 Speaker 1: to get emissions down while continuing to ensure that demand 131 00:07:17,560 --> 00:07:22,680 Speaker 1: for goods and services and energy within the economy continues 132 00:07:22,720 --> 00:07:25,200 Speaker 1: to be met. So the i PC scenario is really 133 00:07:25,200 --> 00:07:29,800 Speaker 1: are looking at the relationship between atmospheric greenhouse gas concentration 134 00:07:29,960 --> 00:07:34,000 Speaker 1: and temperature, and we can then build from that climate 135 00:07:34,040 --> 00:07:37,920 Speaker 1: scenarios that are consistent with certain temperature outcomes. And for 136 00:07:37,960 --> 00:07:43,280 Speaker 1: the new energy out we built a global emissions trajectory 137 00:07:43,440 --> 00:07:47,320 Speaker 1: that is consistent with one point seven five degrees of warming. 138 00:07:47,400 --> 00:07:50,400 Speaker 1: So halfway between two and one point five there's a 139 00:07:50,480 --> 00:07:53,840 Speaker 1: really really big difference in the total amount of emissions 140 00:07:53,840 --> 00:07:56,600 Speaker 1: in the system between one and a half and two degrees, 141 00:07:56,680 --> 00:07:58,720 Speaker 1: and these are the two temperatures that of course everyone 142 00:07:58,760 --> 00:08:01,720 Speaker 1: talks about in terms of the Paris Climate Agreement. Do 143 00:08:01,840 --> 00:08:05,000 Speaker 1: better than two degrees. Pushing towards one point five means 144 00:08:05,040 --> 00:08:07,960 Speaker 1: that somewhere in there is where governments of the world 145 00:08:07,960 --> 00:08:10,560 Speaker 1: have kind of agreed to try and head and we 146 00:08:11,000 --> 00:08:13,280 Speaker 1: can use that as a guide try and set the 147 00:08:13,320 --> 00:08:16,760 Speaker 1: carbon budget. Our scenarios are right down at the low 148 00:08:16,880 --> 00:08:19,640 Speaker 1: end therefore, of the I p C c S range, 149 00:08:19,640 --> 00:08:22,360 Speaker 1: because they have the very very high emissions trajectories and 150 00:08:22,480 --> 00:08:24,480 Speaker 1: the low and so we're trying to get to one 151 00:08:24,480 --> 00:08:27,040 Speaker 1: point five or right down the bottom if we continue 152 00:08:27,080 --> 00:08:29,840 Speaker 1: on without dramatic policy intervention. From here, we've got to 153 00:08:29,920 --> 00:08:32,440 Speaker 1: run out of carbon budget to keep within one point 154 00:08:32,440 --> 00:08:36,240 Speaker 1: five degrees by right. So this is some of the 155 00:08:36,320 --> 00:08:40,040 Speaker 1: urgency around the next ten years is on the current trajectory. 156 00:08:40,200 --> 00:08:43,040 Speaker 1: Even with all the renewables being built out, with the 157 00:08:43,040 --> 00:08:46,040 Speaker 1: record electric vehicle sales and a lot of government interests, 158 00:08:46,360 --> 00:08:48,520 Speaker 1: we're going to run out of budget pretty soon for 159 00:08:48,640 --> 00:08:53,120 Speaker 1: two degrees. That point is we buy ourselves at extra 160 00:08:53,559 --> 00:08:57,560 Speaker 1: twenty five years almost. It's huge, it's huge. And so 161 00:08:58,240 --> 00:09:01,080 Speaker 1: these temperature differences seem small all but in terms of 162 00:09:01,120 --> 00:09:05,320 Speaker 1: the impact on the transition of the economy from dirty 163 00:09:05,360 --> 00:09:08,160 Speaker 1: to clean, they're really really big. And see this is 164 00:09:08,160 --> 00:09:10,600 Speaker 1: a really big problem for modeling because you've got to say, well, 165 00:09:10,880 --> 00:09:13,440 Speaker 1: what is the right temperature trajectory, how do you possibly 166 00:09:13,480 --> 00:09:16,439 Speaker 1: decide where the one point five, one point seven, one 167 00:09:16,480 --> 00:09:19,880 Speaker 1: point nine two point three what the right answer is, 168 00:09:20,000 --> 00:09:22,319 Speaker 1: and then how do you split that up between sectors 169 00:09:22,360 --> 00:09:25,360 Speaker 1: between countries, Because if you can't model that, then you 170 00:09:25,400 --> 00:09:28,120 Speaker 1: don't really know how to model the supply side, which 171 00:09:28,160 --> 00:09:30,320 Speaker 1: is all the technologies that get us there. And that's 172 00:09:30,360 --> 00:09:33,920 Speaker 1: the first challenge with sort of big net zero energy 173 00:09:33,960 --> 00:09:36,520 Speaker 1: scenarios that we develop. So just to be clear, when 174 00:09:36,520 --> 00:09:38,320 Speaker 1: we set out to do this, we were aiming for 175 00:09:38,480 --> 00:09:41,640 Speaker 1: a net zero emissions world, but we didn't have a 176 00:09:41,679 --> 00:09:45,200 Speaker 1: temperature change in mind. It was just can we get 177 00:09:45,240 --> 00:09:49,520 Speaker 1: to net zero in specifically the energy world that you know, 178 00:09:49,520 --> 00:09:51,720 Speaker 1: that's what we're talking about here. This is agnostic of 179 00:09:52,240 --> 00:09:56,199 Speaker 1: agriculture and other sectors outside of energy. Yeah, the exercise 180 00:09:56,200 --> 00:09:59,640 Speaker 1: we do is just energy focused. So we're skipping a 181 00:09:59,679 --> 00:10:02,240 Speaker 1: whole bunch of emissions that matter, and agriculture and land 182 00:10:02,360 --> 00:10:05,480 Speaker 1: use and the leaking of methane and other things from pipelines. 183 00:10:05,520 --> 00:10:08,280 Speaker 1: We're looking at really the core of the of the 184 00:10:08,400 --> 00:10:13,000 Speaker 1: energy economy, which is the supply, transformation and consumption of energy, 185 00:10:13,760 --> 00:10:16,520 Speaker 1: whether it be to heat a building, move a car, 186 00:10:17,120 --> 00:10:20,600 Speaker 1: make an electron, or even actually as a feedstock into 187 00:10:20,679 --> 00:10:23,440 Speaker 1: chemical industries, you know, things like oil of course go 188 00:10:23,520 --> 00:10:26,640 Speaker 1: to make plastics something. So there's a there's a lot 189 00:10:26,679 --> 00:10:29,960 Speaker 1: of energy accounting in these scenarios. We're trying to track 190 00:10:30,000 --> 00:10:32,400 Speaker 1: each one of those flows all the way through to 191 00:10:32,600 --> 00:10:34,920 Speaker 1: the useful economy, which is the things we want, right 192 00:10:35,080 --> 00:10:38,199 Speaker 1: but what we want is to move around to warm 193 00:10:38,240 --> 00:10:40,400 Speaker 1: the spaces and cool the spaces that we live in, 194 00:10:40,880 --> 00:10:44,000 Speaker 1: and we want to make things and build things, and 195 00:10:44,200 --> 00:10:46,640 Speaker 1: we need energy to do all of that. What percentage 196 00:10:46,679 --> 00:10:48,880 Speaker 1: of the remaining carbon budget would you say that the 197 00:10:49,000 --> 00:10:53,360 Speaker 1: energy industry occupies, so the energy sector makes up over 198 00:10:54,160 --> 00:10:57,040 Speaker 1: It depends how you do the accounting, but it's certainly 199 00:10:57,080 --> 00:11:00,880 Speaker 1: towards three quarters of global greenhouse gas emission. That is 200 00:11:00,920 --> 00:11:05,040 Speaker 1: the really sort of immediate and big challenges to decarbonize 201 00:11:05,480 --> 00:11:09,000 Speaker 1: the energy sectors, and there's a huge number of different 202 00:11:09,040 --> 00:11:12,120 Speaker 1: technology challenges within that. And the outlook, the new energy 203 00:11:12,120 --> 00:11:16,080 Speaker 1: outlook kind of starts with that end economy and goes, well, 204 00:11:16,080 --> 00:11:18,320 Speaker 1: what do we need and then how do we do 205 00:11:18,400 --> 00:11:20,960 Speaker 1: those things? How do we get those things in a 206 00:11:21,040 --> 00:11:23,640 Speaker 1: zero carbon way over time? And what are the technology 207 00:11:23,640 --> 00:11:28,760 Speaker 1: transitions that we might anticipate needing to happen to do that. Okay, 208 00:11:28,840 --> 00:11:32,199 Speaker 1: let's talk about the three different scenarios that we put forward. 209 00:11:32,640 --> 00:11:34,440 Speaker 1: Which one do you start with? This isn't picking your 210 00:11:34,480 --> 00:11:36,320 Speaker 1: favorite child, it's at the very beginning, which one do 211 00:11:36,320 --> 00:11:38,760 Speaker 1: you want to start with? Well, let me discuss all 212 00:11:38,840 --> 00:11:40,640 Speaker 1: three at once, and then we can see which one 213 00:11:40,679 --> 00:11:43,640 Speaker 1: is the most interesting, because I don't think there's one 214 00:11:43,679 --> 00:11:46,320 Speaker 1: that is right now more likely than the others. In in 215 00:11:46,200 --> 00:11:50,600 Speaker 1: in a way, these are global technology paradigms rather than 216 00:11:51,200 --> 00:11:54,640 Speaker 1: sort of bottom up balanced scenarios. Would you say they're 217 00:11:54,679 --> 00:11:58,119 Speaker 1: intentionally extreme. They're designed. If you think about a landscape 218 00:11:58,120 --> 00:12:01,080 Speaker 1: of a future possible worlds, it's very hard to be 219 00:12:01,080 --> 00:12:03,480 Speaker 1: able to pinpoint. And our job isn't really to pinpoint 220 00:12:03,600 --> 00:12:06,320 Speaker 1: the future. It's not a prediction. Our job is to 221 00:12:06,400 --> 00:12:09,679 Speaker 1: describe parts of the landscape that enable people to make 222 00:12:09,720 --> 00:12:12,760 Speaker 1: decisions in a useful way. And so we've defined with 223 00:12:12,800 --> 00:12:17,560 Speaker 1: these scenarios three different technology paradigms. One where we have 224 00:12:17,800 --> 00:12:21,160 Speaker 1: a lot of green hydrogen, one where we have a 225 00:12:21,160 --> 00:12:23,640 Speaker 1: lot of nuclear and what we've called red hydrogen, but 226 00:12:23,679 --> 00:12:26,160 Speaker 1: people call it pink hydrogen, and one where we have 227 00:12:26,280 --> 00:12:30,360 Speaker 1: carbon capture and storage as the dominant secondary vectors of decabanization. 228 00:12:30,679 --> 00:12:35,080 Speaker 1: All three scenarios have loads of renewables, loads of electric vehicles, 229 00:12:35,400 --> 00:12:38,520 Speaker 1: heat pumps, and other forms of electrification of the economy 230 00:12:38,679 --> 00:12:40,280 Speaker 1: because these are the things we can kind of do 231 00:12:40,360 --> 00:12:42,440 Speaker 1: today and the things that are already happening in The 232 00:12:42,520 --> 00:12:46,760 Speaker 1: big uncertainty around that landscape is what about these secondary solutions, 233 00:12:46,760 --> 00:12:49,360 Speaker 1: Which ones will emerge, which ones will get to scale, 234 00:12:49,360 --> 00:12:51,560 Speaker 1: which ones will get cost competitive, And it's quite hard 235 00:12:51,559 --> 00:12:54,439 Speaker 1: to pick that for now. So we defined the scenarios 236 00:12:54,480 --> 00:12:58,280 Speaker 1: based around then assumption that in the future, whether it's 237 00:12:58,320 --> 00:13:00,920 Speaker 1: the green hydrogen or whether it's the nuclear or whether 238 00:13:00,920 --> 00:13:03,880 Speaker 1: it's the carbon capture and storage, those are the technologies 239 00:13:03,920 --> 00:13:07,520 Speaker 1: that that end up dominating. But in reality, actually, since 240 00:13:07,520 --> 00:13:10,600 Speaker 1: you are talking about all three, hydrogen plays a central 241 00:13:10,679 --> 00:13:12,920 Speaker 1: role in all three of them in some way, shape 242 00:13:13,000 --> 00:13:15,160 Speaker 1: or form. It just depends on what we make the 243 00:13:15,240 --> 00:13:19,040 Speaker 1: hydrogen out of. Why is it that hydrogen appears in 244 00:13:19,080 --> 00:13:23,440 Speaker 1: all three net zero scenarios? So hydrogen emerges because you 245 00:13:23,520 --> 00:13:26,920 Speaker 1: can't electrify everything. But that's the basic conclusion of doing 246 00:13:27,320 --> 00:13:29,719 Speaker 1: all this sector level analysis is there are things that 247 00:13:29,800 --> 00:13:31,720 Speaker 1: don't work well with electricity, and we kind of know 248 00:13:31,760 --> 00:13:35,280 Speaker 1: that obviously like an aeroplane would require very big and 249 00:13:35,280 --> 00:13:39,880 Speaker 1: heavy batteries to do long haul flights. Similarly, shipping, you 250 00:13:39,960 --> 00:13:42,560 Speaker 1: could see certain sort of coastal shipping routes done with 251 00:13:42,600 --> 00:13:47,960 Speaker 1: electric ships, but for long ocean voyages you need a 252 00:13:48,040 --> 00:13:50,719 Speaker 1: lot of energy storage and energy density in the form 253 00:13:50,760 --> 00:13:53,559 Speaker 1: of batteries which make the ships very heavy that displaces 254 00:13:54,080 --> 00:13:57,600 Speaker 1: space for cargoes, etcetera. Even in the power sector wind 255 00:13:57,640 --> 00:14:01,560 Speaker 1: and PV, you can only get you maybe seventy of 256 00:14:01,640 --> 00:14:05,600 Speaker 1: supply depending on the country, depending on the latitude and 257 00:14:05,640 --> 00:14:09,600 Speaker 1: the natural resources that country has to work with, which 258 00:14:09,679 --> 00:14:12,400 Speaker 1: means you've got of the electricity demand in the year 259 00:14:12,400 --> 00:14:13,920 Speaker 1: which needs to be met by something else. And what 260 00:14:13,960 --> 00:14:17,160 Speaker 1: we say is a lot of the energy transition can 261 00:14:17,200 --> 00:14:21,320 Speaker 1: be met with clean electrons, but there is a significant 262 00:14:21,320 --> 00:14:25,280 Speaker 1: fraction and what we calculate to be at least of 263 00:14:25,360 --> 00:14:28,960 Speaker 1: final energy consumption that it's not an electricity based and 264 00:14:29,000 --> 00:14:31,400 Speaker 1: of that in our scenario is certainly in the green 265 00:14:31,480 --> 00:14:35,960 Speaker 1: and the red. Around twenty of final energy consumption we 266 00:14:36,000 --> 00:14:38,280 Speaker 1: think could be hydrogen, and then it matters how you 267 00:14:38,320 --> 00:14:40,880 Speaker 1: make the hydrogen. But hydrogen being an energy carrier, being 268 00:14:40,880 --> 00:14:43,480 Speaker 1: a molecule that looks a little bit more like a 269 00:14:43,520 --> 00:14:45,760 Speaker 1: fossil fuel than it does like an electron, and therefore 270 00:14:45,800 --> 00:14:48,520 Speaker 1: has applications in what we might call hard to abate 271 00:14:48,560 --> 00:14:51,680 Speaker 1: sectors in parts of the economy we can't electrify. And 272 00:14:51,680 --> 00:14:54,200 Speaker 1: that's why it appears, because it's pretty useful. If we 273 00:14:54,240 --> 00:14:57,160 Speaker 1: don't use hydrogen, we've got to find other molecule based solutions. 274 00:14:57,160 --> 00:14:59,800 Speaker 1: It could be synthetic fuels or bio fuels, it could 275 00:14:59,840 --> 00:15:03,680 Speaker 1: be carbon capture and sequestration. Continue to use the fossil 276 00:15:03,720 --> 00:15:06,800 Speaker 1: fuel molecules, but then we deal with the emissions separately. 277 00:15:07,280 --> 00:15:10,960 Speaker 1: For most of the energy economy outside of power, and 278 00:15:11,040 --> 00:15:13,880 Speaker 1: certainly in this second phase, clean versions of what we 279 00:15:13,920 --> 00:15:16,520 Speaker 1: do today are actually quite few and far between. So 280 00:15:16,560 --> 00:15:19,920 Speaker 1: the questions we have to ask ourselves are what emerges 281 00:15:20,040 --> 00:15:22,760 Speaker 1: is the most likely solution, and if we don't know that, 282 00:15:23,080 --> 00:15:26,600 Speaker 1: how could we present different scenarios that reflect different winners. 283 00:15:26,600 --> 00:15:29,120 Speaker 1: And that's that's what we've done. So you bring up 284 00:15:29,120 --> 00:15:31,120 Speaker 1: the hard to abate sectors and how difficult it's going 285 00:15:31,160 --> 00:15:34,680 Speaker 1: to be in that run to In that run to 286 00:15:34,760 --> 00:15:38,840 Speaker 1: actual net zero world, there are industries like you brought 287 00:15:38,920 --> 00:15:42,800 Speaker 1: up late aviation that are proving to be extremely challenging. Now, 288 00:15:42,920 --> 00:15:46,240 Speaker 1: let's hope for some serious technology breakthroughs that will help 289 00:15:46,320 --> 00:15:49,360 Speaker 1: us then. But you also mentioned that the energy transition 290 00:15:49,480 --> 00:15:51,920 Speaker 1: is happening in many respects in two parts, and there 291 00:15:52,080 --> 00:15:54,480 Speaker 1: is a big emphasis on the decade that we are 292 00:15:54,520 --> 00:15:57,160 Speaker 1: sitting in right now and everything we need to deploy. 293 00:15:57,480 --> 00:16:01,360 Speaker 1: How does it differ across the three different scenarios. Because 294 00:16:01,400 --> 00:16:03,880 Speaker 1: I took a look at them and I tried to 295 00:16:03,920 --> 00:16:06,280 Speaker 1: do a quick zoom in, and they look very similar. 296 00:16:06,440 --> 00:16:09,560 Speaker 1: I think that's an important conclusion, is that getting to 297 00:16:09,640 --> 00:16:14,200 Speaker 1: net zero, which is consistent with an orderly transition, if 298 00:16:14,200 --> 00:16:16,400 Speaker 1: we want to get on track, we want to get 299 00:16:16,400 --> 00:16:20,560 Speaker 1: on track for one point five degrees or just net 300 00:16:20,640 --> 00:16:25,400 Speaker 1: zero in then there's a certain trajectory that we have 301 00:16:25,480 --> 00:16:29,800 Speaker 1: to meet in terms of emission productions every year. And 302 00:16:29,840 --> 00:16:32,240 Speaker 1: when we do the math on this, what becomes really 303 00:16:32,240 --> 00:16:35,480 Speaker 1: clear is that we have to go much much faster 304 00:16:35,560 --> 00:16:37,760 Speaker 1: this decade. And actually the only way you can go 305 00:16:37,840 --> 00:16:41,240 Speaker 1: faster is by deploying the things you've got. You can't 306 00:16:41,320 --> 00:16:45,200 Speaker 1: reduce emissions faster by investing in early stage technology that 307 00:16:45,200 --> 00:16:49,000 Speaker 1: that's for later, right, But this decade you need to 308 00:16:49,040 --> 00:16:52,240 Speaker 1: deploy everything you've got and that means you need to 309 00:16:52,320 --> 00:16:56,680 Speaker 1: have faster and more renewable energy deployment. You need more 310 00:16:56,720 --> 00:16:59,440 Speaker 1: electric vehicles on the road, you need greater recycling in 311 00:16:59,480 --> 00:17:02,360 Speaker 1: the industry is you need more heat pumps being put 312 00:17:02,400 --> 00:17:06,119 Speaker 1: into buildings can run off electricity. You need a greater 313 00:17:06,400 --> 00:17:10,800 Speaker 1: penetration of bio fuels or sustainable aviation fuels for airplanes, 314 00:17:11,240 --> 00:17:13,520 Speaker 1: and you've got to do that at a certain rate 315 00:17:13,560 --> 00:17:16,040 Speaker 1: to get on track by That doesn't solve your problem, 316 00:17:16,040 --> 00:17:18,880 Speaker 1: but that keeps you within striking distance of your end goal, 317 00:17:19,200 --> 00:17:23,520 Speaker 1: and because getting on track is the primary task. Regardless 318 00:17:23,520 --> 00:17:26,000 Speaker 1: of the scenario, they do look very very similar. They 319 00:17:26,080 --> 00:17:28,560 Speaker 1: differ in the way in which we might need to 320 00:17:28,600 --> 00:17:31,119 Speaker 1: see the ramp up and the scaling of these phase 321 00:17:31,200 --> 00:17:35,680 Speaker 1: two options, whether that's green hydrogen or carbon caption storage 322 00:17:35,760 --> 00:17:39,040 Speaker 1: or small module in nuclear reactors or whatever technology set 323 00:17:39,320 --> 00:17:41,600 Speaker 1: we are thinking about. We're gonna have to scale that 324 00:17:41,680 --> 00:17:45,360 Speaker 1: up this decade so it's ready to deploy post These 325 00:17:45,359 --> 00:17:48,639 Speaker 1: are coming from very small percentages of the overall market 326 00:17:48,680 --> 00:17:50,720 Speaker 1: right now. We need to see almost like a hockey 327 00:17:50,800 --> 00:17:54,160 Speaker 1: stick upward of adoption these technologies. In my correct yeah, 328 00:17:54,200 --> 00:17:55,880 Speaker 1: for those I mean, but even for wind and PV 329 00:17:56,240 --> 00:17:59,320 Speaker 1: right in our scenarios. We want to see about an 330 00:17:59,320 --> 00:18:04,600 Speaker 1: average of five gigawatts of wind and sort of giga 331 00:18:04,600 --> 00:18:10,000 Speaker 1: wats of PV deployed every year out to which is 332 00:18:10,680 --> 00:18:14,320 Speaker 1: double the PV and about sort of fourish times the 333 00:18:14,320 --> 00:18:18,080 Speaker 1: amount of wind that we've seen in even in the 334 00:18:18,119 --> 00:18:22,120 Speaker 1: technologies where we're already doing a lot renewables in particular 335 00:18:22,200 --> 00:18:24,320 Speaker 1: that are cost competitive today. We just need a rate 336 00:18:24,359 --> 00:18:26,240 Speaker 1: of a rate of deployment, a rate of change. It's 337 00:18:26,240 --> 00:18:28,680 Speaker 1: a lot lot faster than the sort of the organic 338 00:18:29,119 --> 00:18:32,000 Speaker 1: rate of deployment, which means we need policy intevidual. So 339 00:18:32,080 --> 00:18:34,320 Speaker 1: let's talk about that. So there's the policy intervention that 340 00:18:34,400 --> 00:18:37,400 Speaker 1: is needed to create this hockey stick kind of very 341 00:18:37,480 --> 00:18:41,080 Speaker 1: quick adoption of certain technologies. If we left everything to 342 00:18:41,240 --> 00:18:46,640 Speaker 1: economics and every country was a complete rational actor in economics, 343 00:18:47,160 --> 00:18:49,120 Speaker 1: where would that get us? Because that was the analysis 344 00:18:49,200 --> 00:18:51,439 Speaker 1: we did the prior year we did our New Energy Outlook, 345 00:18:51,480 --> 00:18:53,679 Speaker 1: and then we said, okay, if we just looked at 346 00:18:53,680 --> 00:18:56,679 Speaker 1: a world agnostic of policy, where would that get us 347 00:18:56,680 --> 00:18:59,760 Speaker 1: from a warming standpoint? I think most people would think that, well, 348 00:18:59,800 --> 00:19:02,960 Speaker 1: in the absence of policy, we're heading out towards four 349 00:19:03,040 --> 00:19:05,639 Speaker 1: or five degrees and the end of days, right. I 350 00:19:05,680 --> 00:19:10,399 Speaker 1: think what we determined from previous scenario work, and that 351 00:19:10,480 --> 00:19:14,720 Speaker 1: looks at the underlying economics of technology change where it 352 00:19:14,840 --> 00:19:18,439 Speaker 1: exists today. So that means we're thinking about where the 353 00:19:18,480 --> 00:19:21,080 Speaker 1: crossover points are from the new to the old, and 354 00:19:21,080 --> 00:19:23,800 Speaker 1: in some parts of the economy those crossover points are 355 00:19:24,240 --> 00:19:27,800 Speaker 1: distant distant. There's not a technology solution that's remotely cost 356 00:19:27,880 --> 00:19:31,440 Speaker 1: competitive today for steel or cement or shipping, but there 357 00:19:31,480 --> 00:19:34,840 Speaker 1: are lots of cheap renewables. Electric vehicles are coming, and 358 00:19:34,880 --> 00:19:37,520 Speaker 1: depending on how you heat the house, your heat pumps 359 00:19:37,520 --> 00:19:40,159 Speaker 1: can look attractive as well. So the absence of big 360 00:19:40,760 --> 00:19:45,520 Speaker 1: climate policy drivers, we get to about three point three 361 00:19:45,520 --> 00:19:48,000 Speaker 1: degrees of warming, and what that means is that emissions 362 00:19:48,400 --> 00:19:51,879 Speaker 1: peak and start to decline across the energy economy, but 363 00:19:52,000 --> 00:19:55,000 Speaker 1: not nearly fast enough to get to zero in. So 364 00:19:55,000 --> 00:19:58,919 Speaker 1: there's a lot to do beyond the underlying sort of 365 00:19:59,000 --> 00:20:01,600 Speaker 1: pace of transition and buy our numbers. I think we 366 00:20:01,640 --> 00:20:07,760 Speaker 1: need to see emissions down roughly from levels by a 367 00:20:07,800 --> 00:20:09,520 Speaker 1: lot of that has to happen just from the power 368 00:20:09,520 --> 00:20:12,640 Speaker 1: sector doing more, because the power sect, you can it's 369 00:20:12,680 --> 00:20:17,680 Speaker 1: where we have the most cost competitive abatement options to deploy. 370 00:20:17,760 --> 00:20:20,760 Speaker 1: So just to add some complexity to this decade, and 371 00:20:20,800 --> 00:20:23,760 Speaker 1: actually not even this decade, just this year and next year, 372 00:20:24,520 --> 00:20:28,159 Speaker 1: I can't help but think about the incredibly erratic and 373 00:20:28,680 --> 00:20:32,000 Speaker 1: may I even say, very high natural gas prices and 374 00:20:32,040 --> 00:20:36,320 Speaker 1: what that's doing to a number of different countries and 375 00:20:36,359 --> 00:20:39,040 Speaker 1: the utilities operating there, because this has become what was 376 00:20:39,080 --> 00:20:42,160 Speaker 1: at one point in time highly regional and now more 377 00:20:42,240 --> 00:20:45,240 Speaker 1: much much more of a global marketplace for gas. Analogy, 378 00:20:46,480 --> 00:20:50,560 Speaker 1: do we see in our scenarios these natural gas prices 379 00:20:50,640 --> 00:20:54,840 Speaker 1: fundamentally changing the near term future or the long term future. 380 00:20:55,160 --> 00:20:59,359 Speaker 1: There's always a question to ask in scenario work whether 381 00:21:00,000 --> 00:21:04,720 Speaker 1: always in the market today is a meaningful signal for 382 00:21:04,760 --> 00:21:08,679 Speaker 1: the longer term, And invariably it's not. Prices go up, 383 00:21:08,680 --> 00:21:12,439 Speaker 1: prices go down. They tend to reflect dynamics of the moment. 384 00:21:12,680 --> 00:21:16,879 Speaker 1: And what we know is that in the absence of 385 00:21:17,400 --> 00:21:20,960 Speaker 1: forces that drive the system in a certain direction, and 386 00:21:20,960 --> 00:21:24,560 Speaker 1: those might be policy or different geo political events or 387 00:21:24,560 --> 00:21:28,600 Speaker 1: something like that, that you get commodity cycles. The adage 388 00:21:28,600 --> 00:21:31,399 Speaker 1: that the solution to high prices is high prices is 389 00:21:31,400 --> 00:21:36,639 Speaker 1: broadly true. High prices should create new supply that drives 390 00:21:36,680 --> 00:21:39,359 Speaker 1: prices down. The increases demand that drives prices up, and 391 00:21:39,400 --> 00:21:41,400 Speaker 1: you play this game and so you get these commodity 392 00:21:41,440 --> 00:21:44,720 Speaker 1: cycles then more complicated than that, of course, But the 393 00:21:44,840 --> 00:21:49,240 Speaker 1: question really is is this time different. Do the gas 394 00:21:49,280 --> 00:21:52,879 Speaker 1: prices that we assume into the future should they be 395 00:21:53,000 --> 00:21:57,760 Speaker 1: altered by the current crunch on gas? And if so why? 396 00:21:58,119 --> 00:22:00,880 Speaker 1: Really difficult question, I think the main in thing we've 397 00:22:00,880 --> 00:22:03,159 Speaker 1: got to ask ourselves is there any reason why that 398 00:22:03,200 --> 00:22:07,879 Speaker 1: commodity cycle gets broken? And climate policy is something that 399 00:22:07,920 --> 00:22:12,200 Speaker 1: can break a commodity cycle, because a commodity cycle relies 400 00:22:12,280 --> 00:22:16,440 Speaker 1: on demand sort of waxing and waning, and supply waxing 401 00:22:16,440 --> 00:22:19,480 Speaker 1: and waning in response to price. If a climate policy 402 00:22:19,520 --> 00:22:23,639 Speaker 1: environment starts to destroy demand, for example, for a commodity 403 00:22:23,720 --> 00:22:27,960 Speaker 1: like gas artificially from the market, are you, by putting 404 00:22:27,960 --> 00:22:31,160 Speaker 1: in place some sort of carbon price or some sort 405 00:22:31,160 --> 00:22:33,920 Speaker 1: of limit, or even the expectation that in the future 406 00:22:34,440 --> 00:22:37,800 Speaker 1: we will need less gas, that's going to start nudging 407 00:22:38,240 --> 00:22:41,360 Speaker 1: the dynamics of supply and demand for gas. For example, 408 00:22:42,160 --> 00:22:44,720 Speaker 1: there's a question that if you're a gas developer gas, 409 00:22:44,840 --> 00:22:47,200 Speaker 1: you're developing gas fields and the prices are really hardh 410 00:22:47,200 --> 00:22:50,080 Speaker 1: you should want to go and produce more gas. But 411 00:22:50,119 --> 00:22:53,199 Speaker 1: if you're not confident that the investment you make in 412 00:22:53,240 --> 00:22:55,919 Speaker 1: that supply is going to pay itself off over the 413 00:22:55,960 --> 00:22:59,720 Speaker 1: lifetime of that field, then maybe you're going to hold off. 414 00:23:00,080 --> 00:23:03,080 Speaker 1: You're going to require greater government sort of guarantees that 415 00:23:03,119 --> 00:23:05,280 Speaker 1: you're not going to be left with a stranded asset. 416 00:23:05,800 --> 00:23:08,199 Speaker 1: And as a result, maybe we're not seeing at this 417 00:23:08,240 --> 00:23:10,840 Speaker 1: point the amount of investment, or haven't seen the amount 418 00:23:10,880 --> 00:23:13,919 Speaker 1: of investment over the last five to ten years in 419 00:23:14,640 --> 00:23:18,399 Speaker 1: conventional fuel supply that we might have otherwise if we 420 00:23:18,480 --> 00:23:22,919 Speaker 1: hadn't had this really big focus on climate decarbonization and 421 00:23:23,080 --> 00:23:28,000 Speaker 1: essentially a policy shift away from carbon intensive energy sources. 422 00:23:28,480 --> 00:23:31,240 Speaker 1: If that's the case, then we might see a lack 423 00:23:31,560 --> 00:23:35,200 Speaker 1: of new supply, which means that high prices don't forget 424 00:23:35,400 --> 00:23:39,320 Speaker 1: greater supply, and we might see higher prices for longer. 425 00:23:39,960 --> 00:23:42,240 Speaker 1: That leads to a secondary question though to me, which 426 00:23:42,320 --> 00:23:47,439 Speaker 1: is that ongoing high gas prices politically palatable and is 427 00:23:47,480 --> 00:23:50,760 Speaker 1: that going to force them to pull back on their 428 00:23:50,880 --> 00:23:54,520 Speaker 1: climate ambitions or at least enable supply to to enter 429 00:23:54,560 --> 00:23:57,840 Speaker 1: the market in a more de risked fashion than otherwise 430 00:23:57,960 --> 00:24:00,080 Speaker 1: might And then we've got lock in of car an 431 00:24:00,080 --> 00:24:03,400 Speaker 1: intensive asset, So there's a really complicated set of dynamics. 432 00:24:03,560 --> 00:24:07,399 Speaker 1: In general, higher fossil fuel prices should make cleaner alternatives cheaper. 433 00:24:07,720 --> 00:24:09,560 Speaker 1: The problem is is that in a lot of areas 434 00:24:09,800 --> 00:24:12,199 Speaker 1: you can't just switch. Like my house is heated by 435 00:24:12,240 --> 00:24:15,000 Speaker 1: gas at the moment, I can't just switch. It's really 436 00:24:15,080 --> 00:24:17,960 Speaker 1: expensive and complex for me to switch to a new 437 00:24:18,720 --> 00:24:21,840 Speaker 1: technology option to do that. And and that's me as 438 00:24:21,880 --> 00:24:24,760 Speaker 1: a householder. But you whold industries that run off gas, 439 00:24:24,800 --> 00:24:27,879 Speaker 1: for example, they can't switch overnight. That just means upward 440 00:24:27,880 --> 00:24:31,400 Speaker 1: pressure on prices and inflationary pressure on industrial and sort 441 00:24:31,400 --> 00:24:34,760 Speaker 1: of consumer prices, which governments are gonna start singing. And 442 00:24:34,800 --> 00:24:39,120 Speaker 1: for now, at least in our scenarios, we're not baking 443 00:24:39,119 --> 00:24:42,919 Speaker 1: that in as a new normal. But we'll see. We 444 00:24:43,000 --> 00:24:45,879 Speaker 1: may have to do some more sensitivity work on on 445 00:24:45,920 --> 00:24:49,159 Speaker 1: what a higher gas price might mean for the outcomes. 446 00:24:49,200 --> 00:24:52,240 Speaker 1: So is this the part of the scenarios that will 447 00:24:52,240 --> 00:24:54,720 Speaker 1: be running because this team works year round, is it 448 00:24:54,880 --> 00:24:58,120 Speaker 1: the consumer end of the things that will be under 449 00:24:58,160 --> 00:25:00,560 Speaker 1: the closer microscope next year? Well, can you we expect 450 00:25:00,640 --> 00:25:04,840 Speaker 1: from benf team energy economics for next year. We've got 451 00:25:04,880 --> 00:25:08,800 Speaker 1: one primary focus and that is to produce a set 452 00:25:08,880 --> 00:25:14,320 Speaker 1: of country level net zero scenarios that reflect sort of 453 00:25:14,400 --> 00:25:19,359 Speaker 1: national considerations, the existing policy environment and the elements of 454 00:25:19,400 --> 00:25:24,600 Speaker 1: path dependency of that policy environment, and the competitive advantages 455 00:25:24,640 --> 00:25:27,720 Speaker 1: that a particular country might have in certain energy sources, 456 00:25:27,720 --> 00:25:30,639 Speaker 1: and trying to pull these big global scenarios down to 457 00:25:30,680 --> 00:25:32,840 Speaker 1: a country level and say, well, what is a pathway 458 00:25:33,040 --> 00:25:36,000 Speaker 1: for China, for the US, for Japan, for the UK 459 00:25:36,640 --> 00:25:42,960 Speaker 1: that can meet these climate objectives taking the national considerations 460 00:25:42,960 --> 00:25:46,040 Speaker 1: into account. So that's the really big challenge to similar 461 00:25:46,080 --> 00:25:47,760 Speaker 1: exercise to this year in a way where we've done 462 00:25:47,800 --> 00:25:50,159 Speaker 1: these big global, big global scenarios, we've got to do 463 00:25:50,240 --> 00:25:52,880 Speaker 1: it the same sort of thinking for each each economy 464 00:25:52,880 --> 00:25:54,920 Speaker 1: and a lot of detail. And that's going to require 465 00:25:55,040 --> 00:25:58,600 Speaker 1: a sort of full power of BENF regionally deployed against 466 00:25:58,680 --> 00:26:01,520 Speaker 1: it to come up with pathways that we can then 467 00:26:01,880 --> 00:26:04,280 Speaker 1: discuss with our clients around the world. And that's that's 468 00:26:04,280 --> 00:26:07,120 Speaker 1: a pretty exciting thing because that's the question everyone has 469 00:26:07,160 --> 00:26:09,320 Speaker 1: is how do we get to zero? It's not obvious, 470 00:26:09,480 --> 00:26:12,280 Speaker 1: it's non trivial, and I think these scenarios can help 471 00:26:12,600 --> 00:26:15,720 Speaker 1: light the way for people making big, difficult bets on 472 00:26:15,920 --> 00:26:18,600 Speaker 1: a big uncertain future. I couldn't agree more so, when 473 00:26:18,600 --> 00:26:20,920 Speaker 1: are we going to see that it's not about future policy, 474 00:26:20,920 --> 00:26:24,200 Speaker 1: it's actually baking in existing policy on the books. When 475 00:26:24,240 --> 00:26:25,919 Speaker 1: can we have you back? I think it's the question. 476 00:26:26,200 --> 00:26:30,880 Speaker 1: October is when we're aiming for, so there's a little 477 00:26:30,920 --> 00:26:33,000 Speaker 1: time to wait. Hopefully the way will be worth it. 478 00:26:33,240 --> 00:26:35,520 Speaker 1: Thank you so much for joining today, Sab, Thanks Danna. 479 00:26:43,600 --> 00:26:46,199 Speaker 1: Today's episode of Switched On was edited by Rex Warner 480 00:26:46,320 --> 00:26:49,159 Speaker 1: with Great Stoke Media. Bloomberginny App is a service provided 481 00:26:49,160 --> 00:26:52,040 Speaker 1: by Bloomberg Finance LP and its affiliates. This recording does 482 00:26:52,080 --> 00:26:55,080 Speaker 1: not constitute, nor it should it be construed as investment advice, 483 00:26:55,240 --> 00:26:58,720 Speaker 1: investment recommendations, or a recommendation as to an investment or 484 00:26:58,760 --> 00:27:01,840 Speaker 1: other strategy. Bloombergain you should not be considered as information 485 00:27:01,920 --> 00:27:05,200 Speaker 1: sufficient upon which to base an investment decision. Neither Bloomberg 486 00:27:05,200 --> 00:27:08,760 Speaker 1: Finance LP nor any of its affiliates makes any representation 487 00:27:08,840 --> 00:27:11,280 Speaker 1: or warranty as to the accuracy or completeness of the 488 00:27:11,320 --> 00:27:14,320 Speaker 1: information contained in this recording, and any liability as a 489 00:27:14,320 --> 00:27:16,320 Speaker 1: result of this recording is expressly disclosed.