WEBVTT - Nuclear, Oil, UNGA, and Insurance (Podcast) 0:00:00.840 --> 0:00:04.000 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney alongside 0:00:04.040 --> 0:00:05.240 my co host Matt Miller. 0:00:05.640 --> 0:00:09.600 Every business day we bring you interviews from CEOs, market pros, 0:00:09.720 --> 0:00:13.600 and Bloomberg experts, along with essential market moven news. 0:00:14.160 --> 0:00:17.279 Find the Bloomberg Markets podcast called Apple Podcasts or wherever 0:00:17.400 --> 0:00:20.480 you listen to podcasts, and at Bloomberg dot com Slash podcast. 0:00:21.360 --> 0:00:23.720 Talk about the global energy. We've been calling out the 0:00:23.760 --> 0:00:26.080 price of WTI crude oil, you know, for the last 0:00:26.160 --> 0:00:28.680 several months, as it's moved off of it's low, and 0:00:28.680 --> 0:00:30.720 he's now up another one point four percent today for 0:00:30.840 --> 0:00:33.400 WTI crude just under ninety three dollars or barrel, and 0:00:33.400 --> 0:00:35.600 it's getting a lot of people as it does when 0:00:35.600 --> 0:00:39.040 we see big moves talking about alternatives to oil. One 0:00:39.080 --> 0:00:41.680 of those is nuclear. Seth Gray joins us. He's a 0:00:41.720 --> 0:00:46.320 president and chief executive officer light Bridge Corporation. That's a 0:00:46.400 --> 0:00:50.720 nastac trade. It's company ltbrs at ticker to put in there. Seth, 0:00:50.760 --> 0:00:52.559 thanks so much for joining us here in our Bloomberg 0:00:52.560 --> 0:00:56.240 Interactor Brooker Studio. What is light Bridge Corporation? What do 0:00:56.280 --> 0:00:57.920 you guys do? What's your strategy? 0:00:58.560 --> 0:01:02.000 Look, our main activities are. We are designing advanced fuels 0:01:02.000 --> 0:01:04.679 that will work in the existing reactors as well as 0:01:04.720 --> 0:01:07.200 the newcoming small ones that we're talking. 0:01:07.200 --> 0:01:09.119 So we're talking nuclear nuclear. 0:01:08.840 --> 0:01:11.720 Fuel fuel, so fuel you put inside the reactors. The 0:01:11.760 --> 0:01:14.640 reactors won't work without it. But this is a reimagined, 0:01:14.760 --> 0:01:18.520 for the first time, new better fuel for the reactors. 0:01:18.560 --> 0:01:22.880 We're partnering with Idaho National Laboratory to develop and test it, 0:01:23.360 --> 0:01:26.480 and this will improve the safety of the reactors and 0:01:26.520 --> 0:01:29.880 the economics of the reactors dramatically, as well as the 0:01:29.920 --> 0:01:34.520 non proliferation and can allow reactors to load follow with 0:01:34.600 --> 0:01:36.479 renewables on a zero carbon grid. 0:01:36.880 --> 0:01:40.320 How safe can they be? I just got finished watching Chernobyl, 0:01:41.040 --> 0:01:44.480 which is terrifying, and I know I'm one of the 0:01:44.520 --> 0:01:47.080 last people to watch it. But before that, I watched 0:01:47.120 --> 0:01:50.000 Inside Bill Gates' Brain and I thought it was really 0:01:50.000 --> 0:01:53.920 a fantastic cell for the nuclear industry. He seems to 0:01:54.040 --> 0:01:58.440 have found a very safe solution to creating nuclear energy. 0:01:58.960 --> 0:01:59.160 Right. 0:01:59.200 --> 0:02:03.120 What's happening now is companies like terror Power that Bill 0:02:03.160 --> 0:02:07.280 Gates is the chairman of and light Bridge, our company, 0:02:07.320 --> 0:02:14.279 are developing newer, much safer technologies that literally physically cannot 0:02:14.320 --> 0:02:18.760 have an accident like Chernoybyl. These are very different, extremely 0:02:18.800 --> 0:02:22.680 safer technologies. The light Bridge fuel runs one thousand degrees 0:02:22.720 --> 0:02:26.880 celsius cooler in reactors than the current fuel and actually 0:02:26.880 --> 0:02:30.600 will produce more power while doing it, and just extremely safe. 0:02:30.880 --> 0:02:35.000 Set reset kind of the world energy grid for US, 0:02:35.280 --> 0:02:38.840 where is nuclear power today in the US, and then 0:02:38.840 --> 0:02:41.480 maybe in other parts of the world. Is it on 0:02:41.520 --> 0:02:44.280 the ascendency or is it still facing a lot of headwinds. 0:02:45.720 --> 0:02:49.640 It's on the ascendancy. The polling in most countries shows 0:02:49.760 --> 0:02:54.280 nuclear has about two thirds favorable or strongly favorable support, 0:02:54.680 --> 0:02:57.200 and the people who work in nuclear don't believe that, 0:02:58.360 --> 0:03:04.760 and that we're seeing new nuclear reactors being finished in Georgia, 0:03:04.840 --> 0:03:09.720 in the United States, ordered in many countries, we're seeing 0:03:10.160 --> 0:03:14.000 rapid development of these small reactors and advanced fuel like 0:03:14.000 --> 0:03:18.240 what light Bridge is doing. And it's partly for climate reasons, 0:03:18.280 --> 0:03:21.720 but I think the stronger driver right now is energy security. 0:03:22.120 --> 0:03:24.720 Countries that either want to get off relying on Putin's 0:03:24.760 --> 0:03:27.800 fossil fuels, or it turns out whoever supplies them with 0:03:27.919 --> 0:03:30.880 fossil fuels they tend not to trust, and being able 0:03:30.919 --> 0:03:32.800 to get off that is a good thing. And you 0:03:32.800 --> 0:03:35.400 know you just mentioned the one percent you know, increase 0:03:35.440 --> 0:03:38.280 in oil prices, it will translate to about one percent 0:03:38.720 --> 0:03:42.320 price increase in a lot of expenses, including gasoline. That 0:03:42.360 --> 0:03:46.680 doesn't happen in nuclear it's very level pricing. A one 0:03:46.760 --> 0:03:51.720 percent increase in uranium price would result in a tiny, 0:03:51.840 --> 0:03:54.520 tiny fraction of one percent of increase in a nuclear 0:03:54.600 --> 0:03:55.240 power price. 0:03:56.200 --> 0:03:59.000 But it's the startup costs that are what terrifies everyone. 0:03:59.080 --> 0:04:03.840 Right, Yes, in in terms of if you're building one 0:04:04.080 --> 0:04:07.960 or two, Yes, if you're building four, By the time 0:04:08.000 --> 0:04:11.119 you get to the third one, those issues are done. 0:04:11.160 --> 0:04:15.200 The United States built over one hundred large reactors, you know, 0:04:15.280 --> 0:04:18.559 most of them on schedule, on budget. The United Arab 0:04:18.600 --> 0:04:22.480 Emirates just built four pretty much on schedule on budget. 0:04:22.600 --> 0:04:26.560 China is, Russia is, France built almost sixty of them 0:04:26.600 --> 0:04:30.120 on schedule on budget. So yes, it's like building a bridge. 0:04:30.160 --> 0:04:33.599 If it's a one of a kind thing, the engineering, 0:04:33.680 --> 0:04:36.680 the complex construction can go over but you build several 0:04:36.720 --> 0:04:39.920 of them, that's not the case. And with these small reactors, 0:04:40.000 --> 0:04:42.320 where much of them will be factory built, you could 0:04:42.360 --> 0:04:46.760 build them like seven thirty sevens, very large numbers and 0:04:47.240 --> 0:04:49.160 really know the timeframes and costs. 0:04:49.880 --> 0:04:52.560 Talk to us about those smaller reactors. I guess I've 0:04:52.560 --> 0:04:54.840 heard about them just over the last several years. Tell 0:04:54.880 --> 0:04:57.560 me what are they, how are they different, and what's 0:04:57.600 --> 0:04:58.359 kind of their purpose? 0:04:59.080 --> 0:05:03.280 Well, right now, the typical nuclear actor is one thousand 0:05:03.360 --> 0:05:08.279 megawats electric power. Small reactors under the US government definition 0:05:08.400 --> 0:05:11.599 are three hundred megawats are smaller, and some go way 0:05:11.640 --> 0:05:14.760 smaller than that, so say less than a third the 0:05:14.800 --> 0:05:17.560 size of the current reactors to even much smaller than that. 0:05:18.120 --> 0:05:20.760 So first of all, you could get them small enough 0:05:21.120 --> 0:05:24.640 that you could have dedicated power to critical facilities like 0:05:24.880 --> 0:05:29.200 military bases, data centers, oil refineries, et cetera. So if 0:05:29.200 --> 0:05:32.279 someone shuts down the electric grid, you don't lose the 0:05:32.320 --> 0:05:38.400 military base, etc. Another factor is that because so much 0:05:38.400 --> 0:05:41.279 of them are factory built and shipped to the site, 0:05:41.400 --> 0:05:45.320 you have very good quality control, can build them much cheaper, 0:05:45.680 --> 0:05:50.520 much faster, and they're just using more advanced, more modern 0:05:50.560 --> 0:05:57.880 technology on safety, so that even with situations like you've 0:05:57.880 --> 0:06:01.440 seen where a reactor will lose water that kind of thing, 0:06:01.960 --> 0:06:06.080 these reactors could not harm anybody literally. 0:06:06.440 --> 0:06:06.599 You know. 0:06:06.640 --> 0:06:09.039 It looks like even if they lived across the street 0:06:09.080 --> 0:06:09.760 from the plant. 0:06:10.440 --> 0:06:12.599 Are they are we building them in the US now 0:06:13.720 --> 0:06:14.440 we are. 0:06:14.560 --> 0:06:19.520 Going too soon. New Scale is working with Idaho National 0:06:19.600 --> 0:06:24.320 Laboratory to deploy one at Idaho National Laboratory. The company 0:06:24.320 --> 0:06:26.800 you mentioned, Terror Power with Bill Gates is looking at 0:06:27.320 --> 0:06:32.880 deploying at least one in Wyoming. X Energy is looking 0:06:32.920 --> 0:06:36.000 at deploying in Texas to power down chemical plants, and 0:06:36.040 --> 0:06:38.839 there are several others that are looking at near term 0:06:38.920 --> 0:06:43.040 and probably the first will actually be nearby. G Hitachi 0:06:43.120 --> 0:06:46.440 deploying one at Ontario Power Generation in Canada. 0:06:47.200 --> 0:06:50.880 Okay, so I know the nuclear energy policy. Someone is 0:06:50.880 --> 0:06:53.680 in New York this week. What's the number one issue? 0:06:54.320 --> 0:06:57.280 Yeah, yeah, and I was pleased to speak there yesterday, 0:06:57.520 --> 0:07:04.160 and the number one is shoe there, I'd say, ostensibly 0:07:04.960 --> 0:07:07.839 is climate change, and that's what John Kerry spoke about 0:07:07.880 --> 0:07:11.160 in his keynote yesterday as part of Climate Week. But 0:07:11.280 --> 0:07:14.360 with President Zelenski about to arrive here in New York 0:07:14.400 --> 0:07:18.560 and speak at some events here too, I think energy 0:07:18.640 --> 0:07:22.800 security is really dominating and we're hearing more and more 0:07:22.840 --> 0:07:26.040 about that at the conference too, not just climate. 0:07:26.400 --> 0:07:29.600 I wonder when everybody started adding a second you to 0:07:29.640 --> 0:07:33.480 the word nuclear. Have you noticed that even George Bush 0:07:33.480 --> 0:07:34.240 says nuclear? 0:07:34.800 --> 0:07:35.040 Yeah? 0:07:35.120 --> 0:07:36.360 Yeah, where's that come from? 0:07:37.120 --> 0:07:37.520 Well? 0:07:38.000 --> 0:07:41.440 I think it came from George Bush originally, but it 0:07:41.560 --> 0:07:47.000 kind of stuck. So it's an American thing. I don't 0:07:47.040 --> 0:07:48.280 hear that in other countries. 0:07:48.600 --> 0:07:50.920 All right, Seth, thanks so much for joining us. Seth Gray, 0:07:50.960 --> 0:07:55.200 President and chief executive officer of light Bridge Corporation lt 0:07:55.480 --> 0:07:58.240 BR is a ticker to load into your Bloomberg terminal. 0:07:59.280 --> 0:08:03.160 You're listening to the team ken'shur Live program Bloomberg Markets 0:08:03.200 --> 0:08:06.280 weekdays at ten am Eastern on Bloomberg dot com, the 0:08:06.360 --> 0:08:09.520 iHeartRadio app, and the Bloomberg Business App, or listen on 0:08:09.560 --> 0:08:11.560 demand wherever you get your podcasts. 0:08:13.200 --> 0:08:15.480 There's just a lot of folks out there doing some 0:08:15.560 --> 0:08:18.360 really good work about just alternative energies in general. One 0:08:18.360 --> 0:08:20.640 of them is Jonathan Maxwell. He's the CEO and co 0:08:20.680 --> 0:08:25.360 founder of Sustainable Development Capital, and he has also has 0:08:25.400 --> 0:08:27.040 got a new book out scene right here, got a 0:08:27.080 --> 0:08:30.320 new book out the Edge, How competition for resources is 0:08:30.320 --> 0:08:33.440 pushing the world and it's climate to the brink and 0:08:33.480 --> 0:08:35.439 what we can do about it. Jonathan, thanks so much 0:08:35.440 --> 0:08:37.920 for joining us here on our Bloomberg Interactive Broker's studio. 0:08:38.320 --> 0:08:40.520 What's the big message for you when you're getting you 0:08:40.559 --> 0:08:42.600 know you here. It's Climate Week in New York, it's 0:08:42.679 --> 0:08:46.520 United Nations General Assembly. I gotta think energy, Given what's 0:08:46.559 --> 0:08:49.520 happening in the world is front and center. What's what's 0:08:49.520 --> 0:08:51.240 the message you bring to your clients. 0:08:51.559 --> 0:08:56.439 So some people might say the clean energy transitional sustainability 0:08:56.480 --> 0:08:59.320 isn't going so well, okay, by most eighty two percent 0:08:59.360 --> 0:09:01.560 of the world is gas and coal in terms of 0:09:01.600 --> 0:09:04.560 its energy. So the message I bring is that not 0:09:04.640 --> 0:09:06.960 only do we need to figure out, which is the 0:09:06.960 --> 0:09:10.240 mainstream piece, how to get more clean energy into the system, 0:09:10.360 --> 0:09:11.920 but we've got to figure out how we can start 0:09:12.000 --> 0:09:16.000 wasting two thirds to three quarters of the energy in 0:09:16.040 --> 0:09:18.679 the system in the first place. So much of the 0:09:18.679 --> 0:09:20.400 gas and the oil is love. 0:09:20.440 --> 0:09:24.559 Before, right, Yeah, because the inefficiencies is your thing, right, 0:09:24.679 --> 0:09:26.040 This is exactly. 0:09:26.480 --> 0:09:29.040 Inefficience is my thing. Because the world weighs seventy five 0:09:29.080 --> 0:09:31.640 percent of its energy, half of the food, and the 0:09:31.679 --> 0:09:32.400 third of the water. 0:09:32.600 --> 0:09:36.840 Is there a cool scientific term for energy that's wasted 0:09:36.880 --> 0:09:37.760 and used. 0:09:37.559 --> 0:09:41.760 Its energy losses, losses of primary energy, energy waste. Some 0:09:41.800 --> 0:09:43.439 of the best work in the world has done here 0:09:43.480 --> 0:09:46.480 in the United States by the Lawrence Livermore National Laboratory. 0:09:46.520 --> 0:09:48.600 They run an energy flow chart. You show how much 0:09:48.679 --> 0:09:51.720 energy comes into the US economy, how much survives. On 0:09:51.720 --> 0:09:54.040 the other side, you lose about two thirds of the 0:09:54.160 --> 0:09:57.000 energy and it's mostly heat. So you talked about nuclear 0:09:57.000 --> 0:10:00.480 power stations. It's great producing power from a nuke plant, 0:10:00.760 --> 0:10:03.800 but if you're dumping the heat, then it's only operating 0:10:03.840 --> 0:10:06.439 at thirty eight percent efficiency. If you've got a gas 0:10:06.920 --> 0:10:10.000 turbine which is driving electricity onto the grid and it's 0:10:10.080 --> 0:10:13.480 dumping the heat, it's delivering forty to fifty percent efficiency. 0:10:13.559 --> 0:10:17.240 But at least the nuclear isn't creating a carbon footprint, right. 0:10:17.240 --> 0:10:19.959 But yes, but you're wasting the heat, and so yeah. 0:10:20.200 --> 0:10:24.480 I understand. But the thing is other energy sources create 0:10:25.040 --> 0:10:28.040 carbon dioxide, which contributes to global warming, right as we 0:10:28.080 --> 0:10:32.440 are told. I don't care if nuclear dumps ninety five 0:10:32.520 --> 0:10:36.520 percent of its energy as long as it doesn't contribute 0:10:36.520 --> 0:10:37.160 to global warming. 0:10:37.240 --> 0:10:37.360 Right. 0:10:37.440 --> 0:10:37.680 Yeah. 0:10:37.720 --> 0:10:40.400 So there are three things and one dimension and that 0:10:40.400 --> 0:10:42.880 they're deditional to think about. So the first is carbon. 0:10:43.040 --> 0:10:45.200 That's a really important thing to solve for. The second 0:10:45.280 --> 0:10:49.200 is cost. How much does it actually cost? Total life 0:10:49.200 --> 0:10:52.560 cycle and actually saving energy is the cheapest possible way, 0:10:52.640 --> 0:10:55.040 especially if you're dumping two thirds of it. The third 0:10:55.120 --> 0:10:58.000 is resilience and availability, and that brings us into the 0:10:58.080 --> 0:11:01.080 last point, like how reliable. Clear is very reliable when 0:11:01.080 --> 0:11:02.400 you put it on the grid. It can run what 0:11:02.400 --> 0:11:04.840 they call baseload, But the problem is how long. So 0:11:04.880 --> 0:11:07.839 here's the last point. Time. So we all talk about 0:11:07.880 --> 0:11:10.959 transitioning the energy system, but it's going to take decades 0:11:11.120 --> 0:11:13.440 and trillions of dollars and we're going to do it. 0:11:13.480 --> 0:11:16.920 And that's what Janet Yellen is talking about tomorrow in 0:11:16.960 --> 0:11:20.080 General Assembly, and we celebrate that. What I'm saying is 0:11:20.200 --> 0:11:23.520 in the meantime it's just as important and it can 0:11:23.559 --> 0:11:27.439 be done if not to waste the energy in the meantime. 0:11:27.480 --> 0:11:30.600 And that's what is the most efficient source of energy 0:11:30.640 --> 0:11:34.280 for running our homes and businesses and cars. 0:11:34.559 --> 0:11:38.160 So the most efficient source of energy for running cars 0:11:38.200 --> 0:11:41.240 is electricity. It's about seventy five percent efficient compared to 0:11:41.280 --> 0:11:42.559 about fifteen to thirty. 0:11:42.400 --> 0:11:45.040 Well, but that electricity comes from many different sources of energy. 0:11:45.080 --> 0:11:47.040 Read it could come from nuclear, come from dirty core. 0:11:47.840 --> 0:11:54.480 So most efficient way of generating energy for electricity it 0:11:54.760 --> 0:11:56.600 is if you can use the heat as well as 0:11:56.640 --> 0:12:01.160 producing the electricity. So cogeneration using wastegot is natural gas 0:12:01.200 --> 0:12:03.880 even but as long as you're using their heat, nuclear 0:12:03.920 --> 0:12:05.120 as long as you're using their. 0:12:05.000 --> 0:12:07.640 Heat, So nuclear with a turbocharger. 0:12:06.960 --> 0:12:10.160 Essentially nuclear with a heat recovery system, and then using 0:12:10.160 --> 0:12:12.920 that heat and then in an industry needs a tremendous 0:12:12.920 --> 0:12:15.080 amount of heat as well as power. And the last 0:12:15.080 --> 0:12:17.520 point I'd make is we always talk about energy as 0:12:17.840 --> 0:12:19.920 if it's electricity. Do you know how much of the 0:12:19.960 --> 0:12:22.160 world's energy is electricity? 0:12:23.320 --> 0:12:23.720 Wow? 0:12:23.840 --> 0:12:27.200 Wow, Well the rest it's heat and transport fuel. So 0:12:27.280 --> 0:12:29.559 here we are in the United States. The United States 0:12:29.600 --> 0:12:32.280 loses seventy eight percent of the primary energy and other 0:12:32.280 --> 0:12:34.280 way to the oil that goes into transport. 0:12:34.480 --> 0:12:38.640 That's the number one told us yesterday, Paul that the 0:12:38.679 --> 0:12:42.760 growth in demand for electricity over the last twenty years, 0:12:42.840 --> 0:12:45.960 or the growth in production, has been zero, which I 0:12:45.960 --> 0:12:49.320 thought was fascinated. I would have imagined it's exponentially larger. 0:12:49.480 --> 0:12:51.199 Well, actually, you know Whatentially, if you look at where 0:12:51.240 --> 0:12:54.680 electricity ends up, it ends up in the home largely, 0:12:54.679 --> 0:12:58.360 so domestic our homes are very significant uses of energy. 0:12:58.559 --> 0:13:02.640 Business and industry to something almost nothing in transport yet, right, 0:13:02.800 --> 0:13:05.000 So if you then put everything into the energy system, 0:13:05.160 --> 0:13:07.720 the big piece is we've got a big problem with 0:13:07.760 --> 0:13:10.240 heat and transport. That's the piece that needs to be solved. 0:13:10.559 --> 0:13:13.240 Seventy five percent of all of this energy solution is 0:13:13.720 --> 0:13:17.560 addressable through making more efficient solutions for buildings, industry, and 0:13:17.559 --> 0:13:20.080 transport generate energy where you need it. 0:13:20.080 --> 0:13:23.720 So you say heat, are you talking about hvactis in general. 0:13:23.480 --> 0:13:26.240 I'm talking about h fact high temperature process heat. I'm 0:13:26.240 --> 0:13:29.920 talking about cooling steel mill, cement plants and very high 0:13:29.960 --> 0:13:32.760 temperature heat cooling. There's more growth in demand for cooling 0:13:32.800 --> 0:13:36.199 by twenty thirteen, then the whole demand for energy and 0:13:36.760 --> 0:13:40.960 India put together. You know, data Center's massive public buildings 0:13:41.000 --> 0:13:43.080 in the country. I come from from my funny accent 0:13:43.160 --> 0:13:45.959 for UK. Fourteen percent of the UK's energy goes used 0:13:46.000 --> 0:13:48.320 by the public sector. The biggest part of it's the 0:13:48.360 --> 0:13:51.600 hospitals and they use again as much heating and cooling 0:13:51.679 --> 0:13:54.800 as they do electricity, and they waste most of it. 0:13:55.600 --> 0:13:58.000 What are some of the technologies that you've seen or 0:13:58.000 --> 0:14:03.400 that you're funding that go this energy waste issue recovery? 0:14:03.480 --> 0:14:06.120 Yeah, So recovering things that would otherwise be wasted, so 0:14:06.200 --> 0:14:09.120 you can you can generate a natural gas even you 0:14:09.240 --> 0:14:11.280 use it in natural gas on site, but use if 0:14:11.320 --> 0:14:13.600 you're on site. You can use the heat for power, sorry, 0:14:13.840 --> 0:14:17.760 heat for heating. If you're taking a blast furnace, you 0:14:17.760 --> 0:14:19.880 can take which we do. We take the waste gases 0:14:19.920 --> 0:14:22.440 from the blast furnace and recycle them into power and steam. 0:14:22.480 --> 0:14:23.280 For steel mills. 0:14:24.280 --> 0:14:26.840 You can put solar on your rooftop, not just at home, 0:14:26.880 --> 0:14:29.880 but a massive scale in commercial industrial applications, and there's 0:14:30.120 --> 0:14:33.480 almost no transmission and distribution loss, and you can match 0:14:33.480 --> 0:14:35.520 your loads well. If you pair it up with batteries. 0:14:35.760 --> 0:14:39.280 You can do heat efficiently by putting heat pumps in 0:14:39.280 --> 0:14:43.480 industrial applications. I've been doing this job for fifteen sixteen 0:14:43.560 --> 0:14:46.640 years of on site energy generation. The biggest innovation I 0:14:46.720 --> 0:14:48.640 was dealing with eleven twelve years ago was the LED 0:14:48.840 --> 0:14:50.960 light barb. All of a sudden, you could save ninety 0:14:50.960 --> 0:14:53.160 percent of the energy with an asset that worked twenty 0:14:53.240 --> 0:14:57.080 percent sorry, twenty times longer. But on site energy generation 0:14:57.240 --> 0:14:59.280 is a massive part of the solution. By the way, 0:14:59.680 --> 0:15:02.480 if you don't stop wasting all of this energy, I'm 0:15:02.520 --> 0:15:07.200 afraid there's no point making all the new stuff, however 0:15:07.200 --> 0:15:09.880 green it is, if we're just dumping the existing energy 0:15:09.920 --> 0:15:10.400 networked out. 0:15:10.440 --> 0:15:11.800 Well, don't tell anybody that. 0:15:12.640 --> 0:15:14.880 We have to do both. We have to go as 0:15:14.920 --> 0:15:18.200 fast as possible in generating clean energy and at the 0:15:18.240 --> 0:15:21.320 same time, but to the same level of effort and 0:15:21.360 --> 0:15:24.080 the same level of investment, we have to invest in 0:15:24.400 --> 0:15:29.080 efficiencies and improvement is happening, it's just starting. I have 0:15:29.160 --> 0:15:31.560 to celebrate the United States on this one, compared to 0:15:31.600 --> 0:15:33.680 my country. At the moment, the United States, about twenty 0:15:33.720 --> 0:15:36.360 percent of the Inflation Production Act is designated for things 0:15:36.520 --> 0:15:39.920 I would broadly define as on site generation or efficiency. 0:15:40.280 --> 0:15:44.000 The European Commission has a massive policy called energy efficiency first. 0:15:44.080 --> 0:15:45.480 That's because if you. 0:15:45.480 --> 0:15:48.560 Remember when Russia last invaded Ukraine, when the annexed Crimea, 0:15:48.600 --> 0:15:50.480 the Europeans came out and said, well, for every unit 0:15:50.520 --> 0:15:52.440 of ass we don't use is too and half we 0:15:52.440 --> 0:15:54.720 don't need to buy from Russia. So Ever, since then, 0:15:54.760 --> 0:15:57.320 although they mumbled it, until last year, the European Commission 0:15:57.320 --> 0:15:59.400 had been quite serious about energy efficiency. It's now in 0:15:59.440 --> 0:16:03.080 the number one policy the UK needs to get serious today. 0:16:03.360 --> 0:16:06.520 There is actually finally a message from the Chancellor looking 0:16:06.560 --> 0:16:10.040 at ways of addressing this. But this is the largest, fastest, 0:16:10.120 --> 0:16:13.280 cheapest source of greenhouse gas emissions, the biggest way of 0:16:13.320 --> 0:16:16.000 cutting costs in the economy, and a huge The great 0:16:16.040 --> 0:16:19.240 news is I'm not here talking about becking for subsidies. 0:16:19.520 --> 0:16:22.400 I'm talking about getting something done that's good for business, 0:16:22.480 --> 0:16:25.280 good for the economy. Actually, I think it's the greatest 0:16:25.320 --> 0:16:27.240 economic opportunity that I know. 0:16:27.400 --> 0:16:29.760 That's all right, Jonathan, great stuff. I knew once you 0:16:29.760 --> 0:16:32.520 start talking. I know this guy, Jonathan Maxwell, CEO and 0:16:32.520 --> 0:16:34.840 co founder of Sustainable Development Capital. 0:16:35.120 --> 0:16:38.240 You're listening to the tape cans are Live program Bloomberg 0:16:38.320 --> 0:16:41.920 Markets weekdays at ten am Eastern on Bloomberg Radio, the 0:16:41.960 --> 0:16:45.200 tune in app, Bloomberg dot Com, and the Bloomberg Business App. 0:16:45.240 --> 0:16:48.040 You can also listen live on Amazon Alexa from our 0:16:48.080 --> 0:16:53.160 flagship New York station, Just say Alexa, play Bloomberg eleven thirty. 0:16:53.600 --> 0:16:58.200 Not surprisingly, climate change and natural disasters are at the 0:16:58.240 --> 0:17:02.720 forefront of concerns among corporate executives, and we want to 0:17:02.720 --> 0:17:04.480 get a handle on that, so we check in with 0:17:04.480 --> 0:17:08.080 Pat Gallagher. He's the CEO of Gallagher Insurance. It is 0:17:08.200 --> 0:17:11.440 on the New York Stock Exchange listed company a JG 0:17:11.840 --> 0:17:15.119 is the ticker. It is a fifty billion dollar market 0:17:15.119 --> 0:17:17.080 cap company. It's starts up twenty four and a half 0:17:17.160 --> 0:17:19.640 percent year to date. It's a fifty two week high 0:17:20.520 --> 0:17:22.720 and it's up seven tens to one percent today. Pat, 0:17:22.760 --> 0:17:25.280 thanks so much for joining us here. I know you 0:17:25.359 --> 0:17:28.679 guys recently conducted a survey of one thousand US business 0:17:28.680 --> 0:17:31.600 owners to understand kind of how they're thinking about risk. 0:17:31.960 --> 0:17:33.760 What are some of the key takeaways you found. 0:17:35.520 --> 0:17:39.000 Well, first of all, it is no surprise that the 0:17:39.040 --> 0:17:44.680 business owners are incredibly concerned about climate change and weather 0:17:44.760 --> 0:17:47.639 related issues. And so when you think about what's happened 0:17:47.680 --> 0:17:50.399 just in the past week or two with Lee coming 0:17:50.480 --> 0:17:53.320 up these coasts, we kind of escaped a major hit, 0:17:53.760 --> 0:17:57.880 but those things continue to rack the business community. In fact, 0:17:58.080 --> 0:18:01.520 I think we estimate the first half natural causes first 0:18:01.520 --> 0:18:03.960 half of the year caused about one hundred and thirty 0:18:04.000 --> 0:18:07.520 eight billion dollars of losses. And if you're a business person, 0:18:07.720 --> 0:18:10.720 you know that's a lot of businesses being impact that's 0:18:10.760 --> 0:18:13.639 a lot of homes being impacted by natural disasters. So 0:18:13.680 --> 0:18:17.840 that really is one of the main concerns of business 0:18:17.840 --> 0:18:22.000 people We interviewed about a thousand clients, all of them 0:18:22.119 --> 0:18:26.520 privately owned. So this is not the professional risk management community. 0:18:26.960 --> 0:18:28.600 These are the people day in and day out that 0:18:28.680 --> 0:18:31.719 make a living by running businesses, and they are concerned 0:18:31.720 --> 0:18:33.719 about their risk management needs, which they should be. 0:18:34.760 --> 0:18:39.200 I wonder, sorry, I wonder if there's a difference. Well, 0:18:39.440 --> 0:18:42.879 they're concerned, but are they doing anything about it? Is 0:18:42.920 --> 0:18:44.480 there anything they can do about it? 0:18:45.880 --> 0:18:48.080 Yes, there is, and that's I think a really good point. 0:18:48.520 --> 0:18:51.960 The fact is that there's a lot they can do 0:18:52.040 --> 0:18:55.560 about it, and risk management and the ability to counsel 0:18:55.640 --> 0:18:58.600 with them and to give them some advice is a 0:18:58.680 --> 0:19:01.480 huge part of what we're all about out Insurance is 0:19:01.560 --> 0:19:04.359 just really one piece of what we do for a client, 0:19:04.480 --> 0:19:07.240 and in fact, we start with that premise that insurance 0:19:07.240 --> 0:19:10.440 plays a role in your risk management. But your risk 0:19:10.480 --> 0:19:13.760 management is not just we buy insurance, and it should 0:19:13.840 --> 0:19:16.200 be what can we do? Where do we locate plants, 0:19:16.800 --> 0:19:18.919 where do we move trucks? How do we react when 0:19:18.960 --> 0:19:22.600 a storm is coming? What is our disaster recovery planning? 0:19:22.640 --> 0:19:25.640 We help on all of that. So when something happens 0:19:25.640 --> 0:19:28.560 that's really a major disaster, how do we get you 0:19:28.680 --> 0:19:32.520 back up in business as quickly as possible. Insurance plays 0:19:32.560 --> 0:19:34.800 a role in all of that, but it's. 0:19:34.680 --> 0:19:37.920 Not the be all and end all, right, So from 0:19:37.920 --> 0:19:41.560 the insurance perspective, I mean, you know, it's interesting, Pat, 0:19:41.560 --> 0:19:44.560 I see a lot of companies relocating to It seems 0:19:44.560 --> 0:19:46.720 like everybody and the Brothers going down to Florida. But boy, 0:19:46.760 --> 0:19:49.280 it'd be a tough place to base a business given 0:19:49.320 --> 0:19:52.919 all the challenges they're facing from you know, all the 0:19:52.920 --> 0:19:55.919 weather issues down there. What do you see when you 0:19:55.960 --> 0:19:58.800 talk to some of these smaller mid sized businesses about 0:19:59.040 --> 0:20:01.480 kind of how they really try to incorporate that into 0:20:01.880 --> 0:20:02.680 kind of their future. 0:20:03.720 --> 0:20:05.600 Well, first of all, I think it's really important enough 0:20:05.680 --> 0:20:08.400 that not all the midsized businesses across America are moving 0:20:08.440 --> 0:20:11.520 to Florida, and they're not moving to Texas. They're in 0:20:11.600 --> 0:20:14.800 business because the communities they're in need them. Whether they're 0:20:14.840 --> 0:20:19.040 construction companies or real estate owners, or whether they're food companies, 0:20:19.080 --> 0:20:22.840 whatever it is, they're in locations because there's business opportunities there. 0:20:23.040 --> 0:20:24.760 So first of all, you've got to start with the 0:20:24.800 --> 0:20:28.480 premise that not all companies either have the same exposures 0:20:28.480 --> 0:20:31.479 are the same. Way to mitigate those exposures. You have 0:20:31.520 --> 0:20:34.240 to really personalize this and you have to sit down 0:20:34.320 --> 0:20:37.159 with a client and understand where are they operating, what 0:20:37.359 --> 0:20:40.480 business is it in. We happen to be privileged to 0:20:40.520 --> 0:20:44.000 be very very expert at about thirty to fifty areas 0:20:44.000 --> 0:20:47.639 of business. So take hotels, or take real estate, or 0:20:47.680 --> 0:20:51.520 religious or not for profit or construction. In these areas, 0:20:51.560 --> 0:20:54.080 we really know that business. So we can sit down 0:20:54.160 --> 0:20:56.560 and it's a different set of exposures for the person 0:20:56.640 --> 0:20:59.520 that has to be a contractor in Naples versus the 0:20:59.520 --> 0:21:03.080 person who's as a contractor or real estate owner in Chicago. 0:21:03.720 --> 0:21:07.200 And these businesses are literally global, but they're across the 0:21:07.560 --> 0:21:11.200