1 00:00:00,640 --> 00:00:05,920 Speaker 1: Welcome to zero. I'm kshatrati this week high winds, high seas, 2 00:00:06,200 --> 00:00:20,000 Speaker 1: and the high price of paperwork. Windpower has seen explosive 3 00:00:20,000 --> 00:00:22,840 Speaker 1: growth over the past couple of decades. What was once 4 00:00:22,880 --> 00:00:26,319 Speaker 1: a fledgling industry with a few scattered turbines is now 5 00:00:26,360 --> 00:00:30,040 Speaker 1: more than seven percent of global electricity supply, up from 6 00:00:30,080 --> 00:00:33,599 Speaker 1: merely two percent in twenty ten. Just last week, the 7 00:00:33,720 --> 00:00:37,040 Speaker 1: UK set its new wind energy record, with two thirds 8 00:00:37,080 --> 00:00:39,920 Speaker 1: of the country's electricity coming from wind at one point. 9 00:00:40,920 --> 00:00:43,080 Speaker 1: But if the world is to achieve net zero by 10 00:00:43,120 --> 00:00:46,680 Speaker 1: twenty fifty, we're going to need a lot more wind turbines, 11 00:00:47,040 --> 00:00:51,440 Speaker 1: both on land but more importantly out at sea. One 12 00:00:51,479 --> 00:00:55,800 Speaker 1: company building that future is ORSTED, the world's largest developer 13 00:00:55,880 --> 00:00:59,440 Speaker 1: of offshore wind power. Formerly known as Danish Oil and 14 00:00:59,520 --> 00:01:03,960 Speaker 1: Natural Gas or DONG, the company has undergone a remarkable transition. 15 00:01:04,440 --> 00:01:06,800 Speaker 1: A little more than a decade ago, it produced more 16 00:01:06,840 --> 00:01:10,320 Speaker 1: than eighty five percent of its electricity from fossil fuels. 17 00:01:10,400 --> 00:01:13,959 Speaker 1: Now almost all of that comes from wind power. It's 18 00:01:13,959 --> 00:01:16,560 Speaker 1: a story of success, the kind of story we need 19 00:01:16,640 --> 00:01:19,640 Speaker 1: more of, but it's one that could very well have 20 00:01:19,840 --> 00:01:23,200 Speaker 1: not happened. Austered has become a case study of how 21 00:01:23,240 --> 00:01:26,559 Speaker 1: to transform a fossil fuel company for the clean energy era. 22 00:01:26,959 --> 00:01:29,760 Speaker 1: But it's actually not just a story of well timed 23 00:01:29,800 --> 00:01:33,640 Speaker 1: forward thinking, but also of a lot of government intervention 24 00:01:34,040 --> 00:01:38,240 Speaker 1: and many happy accidents. Despite all the success of Ousted, 25 00:01:38,560 --> 00:01:41,880 Speaker 1: CEO Madsniper told us that the wind industry is in 26 00:01:41,880 --> 00:01:45,800 Speaker 1: a strange position. There's clearly growing demand for clean energy 27 00:01:45,840 --> 00:01:49,080 Speaker 1: as the world overcomes its addiction to fossil fuels, but 28 00:01:49,320 --> 00:01:51,920 Speaker 1: the industry is struggling to make a decent profit as 29 00:01:51,920 --> 00:01:56,800 Speaker 1: it reckons with permitting problems, supply chain issues, and increased competition. 30 00:01:57,400 --> 00:02:01,200 Speaker 1: Until government buyers will realize that the price will have 31 00:02:01,280 --> 00:02:05,000 Speaker 1: to be more realistic, which will still be significantly cheaper 32 00:02:05,000 --> 00:02:08,360 Speaker 1: than any fossil fuel, there will be a risk that 33 00:02:08,480 --> 00:02:13,280 Speaker 1: things will slow down and even some products potentially not built. 34 00:02:14,040 --> 00:02:16,880 Speaker 1: This week on Zero, mad Nipper joins us to tell 35 00:02:16,919 --> 00:02:20,880 Speaker 1: the real story of his company's transformation, the challenges Arested 36 00:02:21,000 --> 00:02:24,239 Speaker 1: is facing, and the impact of fossil fuel companies now 37 00:02:24,280 --> 00:02:30,080 Speaker 1: trying to get in on the wind game. Welcome to 38 00:02:30,120 --> 00:02:33,760 Speaker 1: the show, mads Thank you so much. Now, Orsted is 39 00:02:33,919 --> 00:02:36,880 Speaker 1: known today in the world as a giant in off 40 00:02:36,919 --> 00:02:41,120 Speaker 1: your wind. It wasn't that very long ago. It was 41 00:02:41,160 --> 00:02:45,560 Speaker 1: called DONG, which stood for Danish Oil and Natural Gas. 42 00:02:46,240 --> 00:02:50,720 Speaker 1: What happened, okay, a brilliant question and a very important question, 43 00:02:51,240 --> 00:02:54,560 Speaker 1: because TONG was born as a merger of a number 44 00:02:54,600 --> 00:02:58,240 Speaker 1: of smaller Danish energy utilities and the oil and gas 45 00:02:58,240 --> 00:03:02,560 Speaker 1: business essentially in Denmark. And what happened was that after 46 00:03:02,639 --> 00:03:05,760 Speaker 1: a few years or some years of successful operation, the 47 00:03:05,840 --> 00:03:11,160 Speaker 1: company found itself in increasing sort of financial challenged outlook, 48 00:03:11,760 --> 00:03:15,440 Speaker 1: and at the same time the then management and board said, 49 00:03:16,280 --> 00:03:20,040 Speaker 1: the path we're on is not future proof. Danish businesses 50 00:03:20,040 --> 00:03:24,440 Speaker 1: and many businesses, successful businesses generally have attendency to say, 51 00:03:25,080 --> 00:03:27,880 Speaker 1: is the business we're running is that fundamentally future proof 52 00:03:27,919 --> 00:03:31,440 Speaker 1: if we think long term and already then this was 53 00:03:31,680 --> 00:03:34,239 Speaker 1: essentially born with strength back in two thousand and eight. 54 00:03:34,560 --> 00:03:37,320 Speaker 1: Already then it was painfully opposed that oil and gas 55 00:03:37,320 --> 00:03:40,280 Speaker 1: and fossil future in general is not future proof. So 56 00:03:40,360 --> 00:03:43,560 Speaker 1: that started with a vision of going from at that 57 00:03:43,600 --> 00:03:48,080 Speaker 1: time fifteen percent renewables and eighty five percent fossil fuel generation, 58 00:03:48,480 --> 00:03:50,800 Speaker 1: and the then CEO had a vision to say, let's 59 00:03:50,840 --> 00:03:53,880 Speaker 1: turn it around and say eighty five percent renewables and 60 00:03:53,920 --> 00:03:57,880 Speaker 1: fifteen percent fossil by twenty forty and then the rest 61 00:03:57,880 --> 00:04:01,440 Speaker 1: of history. So we exceeded that. It actually more than 62 00:04:01,440 --> 00:04:06,160 Speaker 1: twenty years ahead of the first five percent renewables and 63 00:04:07,080 --> 00:04:10,960 Speaker 1: renewable wonderful. Now you also rebranded to Orsted at sometimes 64 00:04:11,040 --> 00:04:14,600 Speaker 1: right in the middle. Why the change, Well, Danish all 65 00:04:14,800 --> 00:04:17,400 Speaker 1: a natural gas. Obviously it's not a good name if 66 00:04:17,440 --> 00:04:21,159 Speaker 1: you're the world's undisputed offshore wind leader. So at the 67 00:04:21,200 --> 00:04:23,920 Speaker 1: time it was said, we need to ensure that we 68 00:04:23,960 --> 00:04:27,000 Speaker 1: find a name that not only is different than tongue, 69 00:04:27,600 --> 00:04:31,160 Speaker 1: but is something that signals the future. And Hans christ 70 00:04:31,200 --> 00:04:34,920 Speaker 1: and Ousted was actually the man who discovered electromagnetism, by 71 00:04:34,960 --> 00:04:36,760 Speaker 1: the way, which fewer people know. He was also the 72 00:04:36,800 --> 00:04:40,680 Speaker 1: one who discovered aluminium and invented more than two thousand 73 00:04:40,760 --> 00:04:44,360 Speaker 1: words in the Danish language, So a brilliant mind. But 74 00:04:44,560 --> 00:04:48,359 Speaker 1: the contribution to inventing electromagnetism, which obvious is a foundation 75 00:04:48,480 --> 00:04:51,240 Speaker 1: for so many things in society today, was why we 76 00:04:51,279 --> 00:04:55,320 Speaker 1: picked that name. In terms of Orsted getting a rebrand, 77 00:04:55,680 --> 00:04:59,800 Speaker 1: it also was the moment where you went from being 78 00:05:00,080 --> 00:05:04,560 Speaker 1: fully publicly owned by the Danish state to majority owned 79 00:05:04,600 --> 00:05:07,400 Speaker 1: by Danish state, and then you're listed on the stock exchange. Yes, 80 00:05:07,440 --> 00:05:11,119 Speaker 1: and for a while you were twice thrice the size 81 00:05:11,160 --> 00:05:13,800 Speaker 1: of BP. Yeah, I don't think we were twice a 82 00:05:13,839 --> 00:05:16,600 Speaker 1: side quiet, but we had a larger market cap than BP, 83 00:05:17,360 --> 00:05:21,320 Speaker 1: and I think that was a recognition from investors that 84 00:05:21,440 --> 00:05:25,720 Speaker 1: the future is renewables, and no doubt that we need 85 00:05:25,839 --> 00:05:31,320 Speaker 1: all possible renewable technologies, ideally offshore wind, onshore wind, solar, 86 00:05:31,520 --> 00:05:34,880 Speaker 1: different storage solutions, and who knows, may be much better 87 00:05:34,880 --> 00:05:37,680 Speaker 1: for you to prove nuclear technologies when we get ten 88 00:05:37,720 --> 00:05:41,880 Speaker 1: twenty years further ahead. We need everything to fundamentally turn 89 00:05:41,920 --> 00:05:45,440 Speaker 1: around the world's energy system. But investors saw that if 90 00:05:45,440 --> 00:05:49,360 Speaker 1: a company like AUSTED can make a complete transformation from 91 00:05:49,440 --> 00:05:52,839 Speaker 1: being one of Europe's most fossil fuel intensive utilities to 92 00:05:53,040 --> 00:05:56,719 Speaker 1: being one of the strongest and then offshore the very 93 00:05:56,760 --> 00:06:02,200 Speaker 1: strongest company in ten years, the almost limitless potential. Now 94 00:06:02,320 --> 00:06:04,560 Speaker 1: I'm going to take a pin and prick a hole 95 00:06:04,600 --> 00:06:06,440 Speaker 1: in this story because I'm going to give a little 96 00:06:06,440 --> 00:06:09,080 Speaker 1: bit more context as to how Orsted happened, and you 97 00:06:09,120 --> 00:06:12,400 Speaker 1: should correct me if I'm wrong. The story of Orsted 98 00:06:12,520 --> 00:06:15,680 Speaker 1: isn't as simple as Mads is making out. To understand 99 00:06:15,680 --> 00:06:19,040 Speaker 1: how ORSTED grew into one of the world's largest wind developers. 100 00:06:19,320 --> 00:06:21,360 Speaker 1: You need to go back to the formation of DONG 101 00:06:21,760 --> 00:06:25,479 Speaker 1: Danish Oil and Natural Gas. In nineteen seventy three, there 102 00:06:25,600 --> 00:06:28,560 Speaker 1: was the Opeque oil crisis, and Denmark was among the 103 00:06:28,600 --> 00:06:32,560 Speaker 1: worst hit in Europe. That forced the government to pause 104 00:06:32,680 --> 00:06:36,360 Speaker 1: and come up with a strategy. It combined several Danish 105 00:06:36,360 --> 00:06:40,000 Speaker 1: oil and gas companies to create DONG, and that entity 106 00:06:40,080 --> 00:06:42,680 Speaker 1: became the state's route to produce oil and gas from 107 00:06:42,720 --> 00:06:46,920 Speaker 1: the Nazi that it had recently found. DONG was just 108 00:06:46,960 --> 00:06:50,480 Speaker 1: one of many state owned enterprises crucial to ensuring Denmark's 109 00:06:50,560 --> 00:06:54,679 Speaker 1: energy security well into the nineties. However, by that time, 110 00:06:54,760 --> 00:06:58,600 Speaker 1: the European Union started implementing rules to promote more competition 111 00:06:58,720 --> 00:07:02,039 Speaker 1: in the energy market. This put the Danish government in 112 00:07:02,080 --> 00:07:04,880 Speaker 1: a tricky position, as they were worried that DONG might 113 00:07:04,920 --> 00:07:07,680 Speaker 1: not be able to compete with the likes of Germany's 114 00:07:07,800 --> 00:07:12,800 Speaker 1: RWE or Sweden's battenfal. So, the Danish state decided to 115 00:07:12,800 --> 00:07:16,120 Speaker 1: create a national energy champion and told DONG to go 116 00:07:16,160 --> 00:07:19,520 Speaker 1: out and start buying power plants. Most of the power 117 00:07:19,560 --> 00:07:21,600 Speaker 1: plants that existed at the time, if they were not 118 00:07:21,720 --> 00:07:25,400 Speaker 1: running on gas, were running on coal, and so By 119 00:07:25,440 --> 00:07:28,920 Speaker 1: the late two thousands, dong became Dong Energy. It had 120 00:07:29,000 --> 00:07:32,720 Speaker 1: oil and gas and coal, and accidentally it had also 121 00:07:32,720 --> 00:07:36,040 Speaker 1: acquired some offshore wind turbines as part of the utility 122 00:07:36,040 --> 00:07:39,840 Speaker 1: companies it had bought. And then two thousand and nine 123 00:07:39,880 --> 00:07:43,280 Speaker 1: was when the Copenhagen Climate Summit happened, and so the 124 00:07:43,320 --> 00:07:46,880 Speaker 1: government said, Tong Energy, you cannot hold on to coal. 125 00:07:47,360 --> 00:07:51,240 Speaker 1: Dong Energy said, yes, we realize the future is not coal. 126 00:07:52,120 --> 00:07:55,120 Speaker 1: And they turned around and they said, oh, but we 127 00:07:55,240 --> 00:07:58,960 Speaker 1: have these offshore wind turbines. Could we make something of it. 128 00:08:00,080 --> 00:08:03,720 Speaker 1: Did I get anything wrong? Yeah, you got You did 129 00:08:03,720 --> 00:08:07,240 Speaker 1: a very good piece of research, and almost everything you 130 00:08:07,320 --> 00:08:10,880 Speaker 1: say is factually correct. I will say, though, the really 131 00:08:10,880 --> 00:08:13,679 Speaker 1: important part of this is when is the transformation made 132 00:08:14,440 --> 00:08:18,080 Speaker 1: from being essentially a utility and an oil and gas 133 00:08:18,120 --> 00:08:23,000 Speaker 1: company and into a fully renewables company. That was not 134 00:08:23,400 --> 00:08:27,120 Speaker 1: something that the government pushed in connection with CUP fifteen, 135 00:08:27,120 --> 00:08:29,480 Speaker 1: which happened in two thousand and nine. That was something 136 00:08:29,520 --> 00:08:33,920 Speaker 1: that happened essentially as part of a vision from the 137 00:08:33,960 --> 00:08:37,800 Speaker 1: company CEO and the company management. So that is the 138 00:08:37,840 --> 00:08:40,280 Speaker 1: main difference. And then the other really important thing was 139 00:08:40,320 --> 00:08:44,440 Speaker 1: that Tongue at the time also really forcefully wanted to 140 00:08:44,480 --> 00:08:47,760 Speaker 1: convert the cold fire power plants to being fired on 141 00:08:48,040 --> 00:08:52,080 Speaker 1: sustainable biomass, which obviously, I mean, there are still opponents 142 00:08:52,120 --> 00:08:55,200 Speaker 1: to biomass, but what everybody at least can agree is 143 00:08:55,200 --> 00:08:58,000 Speaker 1: that it is better than cold. So those are the 144 00:08:58,000 --> 00:09:00,640 Speaker 1: two nuances. And then the story from two thousand and 145 00:09:00,640 --> 00:09:04,120 Speaker 1: eight when that vision was launched up until two thousand 146 00:09:04,200 --> 00:09:08,200 Speaker 1: and twelve, which was essentially when the company said, now 147 00:09:08,320 --> 00:09:11,120 Speaker 1: we make that choice. Now we get in capital from 148 00:09:11,120 --> 00:09:13,800 Speaker 1: in this case Goldman Sex and later on a listing, 149 00:09:14,280 --> 00:09:17,840 Speaker 1: which was what gave the financial opportunity to really accelerate 150 00:09:17,880 --> 00:09:21,720 Speaker 1: offshore wind. Right, So you're right, we got those offshore 151 00:09:21,760 --> 00:09:23,840 Speaker 1: wind turbines from what, by the way, was the world's 152 00:09:23,880 --> 00:09:27,120 Speaker 1: first offshore wind from Binibu, which is now decommissioned. We 153 00:09:27,240 --> 00:09:30,560 Speaker 1: got that, you could say, by accident, but it gave 154 00:09:30,640 --> 00:09:34,959 Speaker 1: an inspiration to something where the choice into one key 155 00:09:35,040 --> 00:09:37,960 Speaker 1: technology and making a whole hearted pair on that was 156 00:09:38,000 --> 00:09:41,200 Speaker 1: something that was really transformation. And we can now just 157 00:09:41,240 --> 00:09:44,800 Speaker 1: say Ousted has become the offshore wind giant, and that's 158 00:09:44,840 --> 00:09:48,320 Speaker 1: where the story ends happily ever after. Yeah, but it's 159 00:09:48,360 --> 00:09:51,120 Speaker 1: not the case. That is not the case. So right now, 160 00:09:51,160 --> 00:09:56,079 Speaker 1: there are some serious challenges, unexpected as they may be. 161 00:09:56,480 --> 00:10:00,439 Speaker 1: Europe is going through an energy crisis. It would speritly 162 00:10:00,480 --> 00:10:03,320 Speaker 1: desperately want to get away from gas and coal, and 163 00:10:03,520 --> 00:10:09,800 Speaker 1: yet wind power companies, not just developers but also suppliers 164 00:10:09,960 --> 00:10:14,040 Speaker 1: of wind turbines are getting hammered in the market. Oil 165 00:10:14,080 --> 00:10:18,200 Speaker 1: and gas giants are making tons and tons of profits. 166 00:10:19,520 --> 00:10:22,959 Speaker 1: Why is that happening. Shouldn't this be the moment where 167 00:10:23,200 --> 00:10:28,360 Speaker 1: renewable energy really shines. Yeah, the great companies and great 168 00:10:28,440 --> 00:10:32,080 Speaker 1: societies in the world are those that keep a long 169 00:10:32,240 --> 00:10:35,480 Speaker 1: term view and continue to do what is fundamentally right 170 00:10:35,520 --> 00:10:38,360 Speaker 1: when things are difficult, and things are difficult on a 171 00:10:38,440 --> 00:10:42,400 Speaker 1: super tragic background with the unacceptable warn Ukraine, it has 172 00:10:42,440 --> 00:10:46,120 Speaker 1: become very obvious that we need to deliberate ourselves from 173 00:10:46,360 --> 00:10:49,760 Speaker 1: energy imports from that part of the world, and at 174 00:10:49,800 --> 00:10:52,600 Speaker 1: the same time, we obviously need to sustain momentum on 175 00:10:52,679 --> 00:10:55,760 Speaker 1: fighting climate change. So in many ways, you could say, 176 00:10:56,160 --> 00:10:59,040 Speaker 1: is there a strong sentiment now for oil and gas 177 00:10:59,120 --> 00:11:01,959 Speaker 1: companies to make a lot of money because enterity prices 178 00:11:01,960 --> 00:11:05,160 Speaker 1: have spiked up and it doesn't cost anymore for the 179 00:11:05,200 --> 00:11:07,360 Speaker 1: oil companies to take up more oil and gas from 180 00:11:07,360 --> 00:11:10,640 Speaker 1: the underground. Of course, that is attractive to investors because 181 00:11:10,640 --> 00:11:13,040 Speaker 1: they make lots and lots of money and the share 182 00:11:13,040 --> 00:11:15,960 Speaker 1: prices go up. That's how at least those are some 183 00:11:16,000 --> 00:11:20,320 Speaker 1: of the dimensions of our capitalism works. I have no 184 00:11:20,400 --> 00:11:24,640 Speaker 1: concerns that if we and here I mean both governments 185 00:11:24,760 --> 00:11:27,640 Speaker 1: and the renewables industry, if we continue to do the 186 00:11:27,760 --> 00:11:31,160 Speaker 1: right thing. This is a temporary setback only and if 187 00:11:31,160 --> 00:11:33,840 Speaker 1: you look at only what has happened in the last 188 00:11:34,040 --> 00:11:38,160 Speaker 1: few months, we have seen renewables ambition only go one way, 189 00:11:38,200 --> 00:11:40,920 Speaker 1: and that is up. We've seen the north Sea Declaration, 190 00:11:41,400 --> 00:11:44,120 Speaker 1: with the North Sea States opping off shore ambitions, the 191 00:11:44,200 --> 00:11:47,400 Speaker 1: Politic declaration. Right now the world has an ambition of 192 00:11:47,640 --> 00:11:50,520 Speaker 1: an off show alone for three hundred and eighty gig 193 00:11:50,600 --> 00:11:54,600 Speaker 1: awards of capacity by twenty thirty and two thousand gig awards, 194 00:11:54,640 --> 00:11:57,560 Speaker 1: which is more than twice of the US total entity 195 00:11:57,559 --> 00:12:01,280 Speaker 1: consumption by twenty fifty. So I am one hundred percent 196 00:12:01,440 --> 00:12:05,640 Speaker 1: convinced that momentum will sustain. But yes, we have setbacks. 197 00:12:06,000 --> 00:12:09,120 Speaker 1: We have setbacks in terms of permitting process being too slow. 198 00:12:09,559 --> 00:12:12,320 Speaker 1: We have setbacks in terms of cost of capitual going up. 199 00:12:12,840 --> 00:12:15,679 Speaker 1: We have setbacks in terms of oil companies obviously being 200 00:12:15,720 --> 00:12:19,120 Speaker 1: able to invest chalkloads of cash, which in some ways 201 00:12:19,200 --> 00:12:21,880 Speaker 1: is good because they also invest in renewables projects and 202 00:12:22,040 --> 00:12:26,240 Speaker 1: he saw them. So it's a mixed bag of good 203 00:12:26,240 --> 00:12:28,360 Speaker 1: and bed. But I can promise you that both we 204 00:12:29,080 --> 00:12:31,160 Speaker 1: and O those players in this industry are not going 205 00:12:31,160 --> 00:12:32,960 Speaker 1: to take our eyes off the ball of the target 206 00:12:32,960 --> 00:12:35,000 Speaker 1: that we need to get to. I think the arguments 207 00:12:35,000 --> 00:12:38,120 Speaker 1: on the long term you make are pretty reasonable. Onshore 208 00:12:38,120 --> 00:12:40,640 Speaker 1: wind has been the cheapest source of power in Europe 209 00:12:40,640 --> 00:12:43,760 Speaker 1: for a long time now already, and offshore wind prices 210 00:12:43,760 --> 00:12:46,000 Speaker 1: have been falling and they will continue to fall for 211 00:12:46,040 --> 00:12:49,280 Speaker 1: some time. But the short term matters a lot because 212 00:12:49,720 --> 00:12:54,840 Speaker 1: it empowers companies like oil and gas companies to be 213 00:12:54,920 --> 00:12:57,920 Speaker 1: able to eat your lunch. They will go and buy 214 00:12:58,000 --> 00:13:00,600 Speaker 1: up sea bed rights, which they have done in the UK, 215 00:13:00,760 --> 00:13:03,640 Speaker 1: which has great of your wind ambition. How are you 216 00:13:03,679 --> 00:13:07,240 Speaker 1: dealing with that kind of competition? Well, first and foremost, 217 00:13:07,280 --> 00:13:10,720 Speaker 1: I think it's super important that any dollar or euro 218 00:13:10,960 --> 00:13:15,320 Speaker 1: that goes into renewable power instead of fossil fuels is 219 00:13:15,320 --> 00:13:18,440 Speaker 1: a good thing from an all star specific point of view. 220 00:13:18,600 --> 00:13:22,880 Speaker 1: Of course, it's annoying because if there is in some 221 00:13:22,920 --> 00:13:26,120 Speaker 1: cases what I call irrational competition with somebody who just 222 00:13:26,200 --> 00:13:29,920 Speaker 1: wants the gig awards and really don't care about the returns. Ultimately, 223 00:13:30,080 --> 00:13:33,560 Speaker 1: that risks stopping the flow of capital to renewable energy 224 00:13:33,559 --> 00:13:38,280 Speaker 1: because investors, if there is no financial return, it becomes 225 00:13:38,280 --> 00:13:41,640 Speaker 1: financially unsustainable, and no matter how much gas oil and 226 00:13:41,640 --> 00:13:46,000 Speaker 1: gas companies will have, then eventually that momentum will discontinue. 227 00:13:46,640 --> 00:13:50,360 Speaker 1: It is super important that our industry, not just for 228 00:13:50,400 --> 00:13:52,880 Speaker 1: the sake of our investors and for our own companies, 229 00:13:53,160 --> 00:13:56,440 Speaker 1: but for the sake of the momentum of renewable energy, 230 00:13:56,760 --> 00:13:59,880 Speaker 1: that we continue to actually keep financial discipline to ensure 231 00:13:59,880 --> 00:14:03,120 Speaker 1: that there's the least an acceptable financial return. But I 232 00:14:03,160 --> 00:14:07,480 Speaker 1: am also hearing that some of the oil companies are 233 00:14:07,520 --> 00:14:10,280 Speaker 1: starting to signal now that it's really important that there 234 00:14:10,320 --> 00:14:12,240 Speaker 1: is a return. Of these examples would be a Queen 235 00:14:12,320 --> 00:14:15,480 Speaker 1: of from Norway BP have recently said the same. So 236 00:14:15,600 --> 00:14:18,959 Speaker 1: I think they're glimmers of hope that we will have 237 00:14:19,000 --> 00:14:22,400 Speaker 1: an industry that is also very sort of mindful about 238 00:14:22,440 --> 00:14:26,360 Speaker 1: the necessity to continue to generate returns. I don't say 239 00:14:26,360 --> 00:14:29,920 Speaker 1: that because austed is afraid of competition. I'm saying this 240 00:14:30,040 --> 00:14:32,400 Speaker 1: because we are a company with the vision of a 241 00:14:32,440 --> 00:14:35,200 Speaker 1: world that runs entirely in green energy, and the lack 242 00:14:35,280 --> 00:14:38,240 Speaker 1: of capital flowing to that transformation is the single biggest 243 00:14:38,280 --> 00:14:42,840 Speaker 1: race we have. That's interesting. We interviewed the CEO of Investors. 244 00:14:42,880 --> 00:14:46,520 Speaker 1: They make wind turbines, they supply some of them to you, 245 00:14:46,720 --> 00:14:51,360 Speaker 1: they supply many to others, and his response was, we 246 00:14:51,440 --> 00:14:54,760 Speaker 1: have no concerns with capital. Investors want to put the 247 00:14:54,840 --> 00:14:59,040 Speaker 1: money in. European Union is committing lots of money. Our 248 00:14:59,080 --> 00:15:05,200 Speaker 1: main challenge is permitting problems that governments are not allowing 249 00:15:05,320 --> 00:15:08,000 Speaker 1: wind turbines and wind farms to be built where they 250 00:15:08,040 --> 00:15:12,360 Speaker 1: need to go, and the race to the bottom where 251 00:15:12,440 --> 00:15:16,640 Speaker 1: countries are competing to advertise how cheap renewables have become, 252 00:15:17,120 --> 00:15:21,920 Speaker 1: but in the process making the small profit margins or 253 00:15:21,960 --> 00:15:26,000 Speaker 1: maybe large profit margins that wind companies make shrink them 254 00:15:26,080 --> 00:15:29,280 Speaker 1: further and make them less viable. That but Hendrick and 255 00:15:29,320 --> 00:15:31,160 Speaker 1: are saying exactly the same thing. We're just saying it 256 00:15:31,200 --> 00:15:34,840 Speaker 1: in different ways. Hendrick is the CEO of Vests exactly. 257 00:15:34,880 --> 00:15:37,080 Speaker 1: I fully agree on the permitting point. It actually takes 258 00:15:37,120 --> 00:15:40,400 Speaker 1: longer to get a plot of seabed permitted than it 259 00:15:40,440 --> 00:15:44,520 Speaker 1: does to build the entire farm that is completely unacceptable. 260 00:15:44,600 --> 00:15:46,440 Speaker 1: How much time does it take to permit and how 261 00:15:46,520 --> 00:15:48,280 Speaker 1: much time does it take to build? It can take, 262 00:15:48,520 --> 00:15:51,360 Speaker 1: worst case, seven to ten years to get it permitted, 263 00:15:51,960 --> 00:15:55,200 Speaker 1: in many cases shorter, but typically takes two to three 264 00:15:55,280 --> 00:15:57,520 Speaker 1: years to build. And just talk us to the process 265 00:15:57,560 --> 00:15:59,680 Speaker 1: of permitting. What is it that they have to what 266 00:15:59,760 --> 00:16:01,680 Speaker 1: are things that they have to do. They have to 267 00:16:01,680 --> 00:16:05,200 Speaker 1: get environmental permits. There needs to be stakeholders, so everything 268 00:16:05,280 --> 00:16:08,200 Speaker 1: from birds to fish, biodiversity, which by the way, is 269 00:16:08,240 --> 00:16:16,560 Speaker 1: super important, fishermen, communities, local summer house owners, seabed geological investigations, 270 00:16:16,600 --> 00:16:18,280 Speaker 1: and all of that needs to so they send out 271 00:16:18,360 --> 00:16:21,600 Speaker 1: people to count the fish and count the birds and 272 00:16:21,960 --> 00:16:25,080 Speaker 1: talk to the people who may see these winter kinds 273 00:16:25,080 --> 00:16:28,440 Speaker 1: of hearings, all of that. But that's important, It is important. 274 00:16:28,560 --> 00:16:31,080 Speaker 1: But the worst thing is that if that was done efficiently, 275 00:16:31,200 --> 00:16:33,800 Speaker 1: it could be done in a year. In some cases, 276 00:16:34,040 --> 00:16:36,600 Speaker 1: for example, in the US, we are still struggling with 277 00:16:36,640 --> 00:16:39,920 Speaker 1: the Bureau of Ocean Energy Management getting enough resources to 278 00:16:40,040 --> 00:16:44,560 Speaker 1: keep momentum. In other places, it's an endless bureaucracy where 279 00:16:44,680 --> 00:16:49,880 Speaker 1: maybe sometimes tens or twenties of different government bodies need 280 00:16:49,920 --> 00:16:52,720 Speaker 1: to be involved. And they don't coordinate. Sometimes an application 281 00:16:52,800 --> 00:16:54,720 Speaker 1: can lie two months on the desk and not get 282 00:16:54,760 --> 00:16:58,360 Speaker 1: onto the next one. There are so many practical dimensions. Yeah, 283 00:16:58,400 --> 00:17:01,280 Speaker 1: we've seen the amount the paperwork then used to be 284 00:17:01,280 --> 00:17:04,639 Speaker 1: done to get an offshore wind permit or even onshore 285 00:17:04,680 --> 00:17:07,600 Speaker 1: wind permit. Yes, and it looks like half a ton 286 00:17:07,800 --> 00:17:10,639 Speaker 1: of paper. Yes, I'm not joking. No, I mean one 287 00:17:10,680 --> 00:17:13,159 Speaker 1: of the applications we've done there has been four thousand, 288 00:17:13,280 --> 00:17:16,199 Speaker 1: three hundred pages. I know that there will be a 289 00:17:16,240 --> 00:17:18,240 Speaker 1: report that will say, yes, what needs to be done, 290 00:17:18,280 --> 00:17:20,880 Speaker 1: But what are you asking of government? I'm asking that 291 00:17:20,920 --> 00:17:26,080 Speaker 1: whatever the key challenge is. Someplaces resources, someplaces bureaucracy, someplaces 292 00:17:26,119 --> 00:17:32,280 Speaker 1: just excessive caretaking of stakeholder concerns, whatever the challenge is 293 00:17:32,320 --> 00:17:35,880 Speaker 1: in a specific country, because it's different that the political will, 294 00:17:36,000 --> 00:17:39,320 Speaker 1: Because the political will is there that that is transformed 295 00:17:39,359 --> 00:17:43,399 Speaker 1: into real action and say, whatever happens, come hell and 296 00:17:43,480 --> 00:17:47,040 Speaker 1: high water, it should never take more than one year, 297 00:17:47,160 --> 00:17:49,639 Speaker 1: and just ask somebody to get it done. That's what 298 00:17:49,680 --> 00:17:58,479 Speaker 1: I would do. If permitting is one problem the industry faces, 299 00:17:58,680 --> 00:18:02,160 Speaker 1: then capital is another. What that means and why it's 300 00:18:02,200 --> 00:18:20,679 Speaker 1: an issue? After the break matts and I talked a 301 00:18:20,680 --> 00:18:23,760 Speaker 1: lot about the pressure the wind industry is facing. One 302 00:18:23,760 --> 00:18:26,480 Speaker 1: of them is the cost of capital, which simply put, 303 00:18:26,600 --> 00:18:29,120 Speaker 1: is the price you pay to borrow money from banks 304 00:18:29,200 --> 00:18:32,600 Speaker 1: or investors, and that matters a lot because most large 305 00:18:32,640 --> 00:18:35,920 Speaker 1: businesses run on borrow money and not their own capital. 306 00:18:36,800 --> 00:18:39,480 Speaker 1: The other pressure comes from the industry selling itself as 307 00:18:39,480 --> 00:18:41,520 Speaker 1: one of the cheapest forms of energy you can buy, 308 00:18:41,800 --> 00:18:45,439 Speaker 1: agreeing to sell power at fixed prices for decades. In 309 00:18:45,600 --> 00:18:48,400 Speaker 1: doing so, the industry has created a trap for itself 310 00:18:49,040 --> 00:18:52,440 Speaker 1: as interest rates rise and supply chains are squeezed, raising 311 00:18:52,480 --> 00:18:54,679 Speaker 1: the cost of the are roughly eight thousand pieces that 312 00:18:54,760 --> 00:18:58,359 Speaker 1: go into a turbine. The industry's profits are also squeezed, 313 00:18:58,840 --> 00:19:03,280 Speaker 1: threatening the financial viability of wind developments. I asked mad 314 00:19:03,480 --> 00:19:06,600 Speaker 1: how this is affecting orsted and supplies like Danish wind 315 00:19:06,600 --> 00:19:11,520 Speaker 1: turbine maker Vests run by CEO Henrick Anderson. Let's come 316 00:19:11,560 --> 00:19:14,840 Speaker 1: to the capital, exactly capital the capital point. Henrick says 317 00:19:14,840 --> 00:19:18,159 Speaker 1: it's a race to the bottom, and I say, eventually 318 00:19:18,359 --> 00:19:21,560 Speaker 1: the capital will dry out. Because Henrick is right that 319 00:19:21,680 --> 00:19:23,520 Speaker 1: it is a race to the bottom. There is very 320 00:19:23,640 --> 00:19:28,160 Speaker 1: very little realization that right now, inflation on many components 321 00:19:28,240 --> 00:19:31,600 Speaker 1: all the way from wind turbines to steal to corpon 322 00:19:31,800 --> 00:19:35,080 Speaker 1: to vessel rentals, to fuels to drive the ships and 323 00:19:35,119 --> 00:19:38,000 Speaker 1: so on. All of that is exploding in inflation, actually 324 00:19:38,560 --> 00:19:41,720 Speaker 1: more than in internal inflation. And at the same time, 325 00:19:42,080 --> 00:19:44,919 Speaker 1: in many cases, the financial return above cost of capital 326 00:19:44,960 --> 00:19:47,960 Speaker 1: and offshore wind is in many cases one two, in 327 00:19:48,040 --> 00:19:50,960 Speaker 1: a really good product three percent. Just bear in mind 328 00:19:51,200 --> 00:19:54,080 Speaker 1: the last three months cost of capital has gone up 329 00:19:54,080 --> 00:19:56,680 Speaker 1: by two to three percent. That puts a huge pressure 330 00:19:57,040 --> 00:20:00,400 Speaker 1: on the returns. And if states around the world say 331 00:20:00,640 --> 00:20:04,040 Speaker 1: entergy prices can only go down, then it will be 332 00:20:04,080 --> 00:20:06,040 Speaker 1: a race to the bottom. And add to that, if 333 00:20:06,040 --> 00:20:09,960 Speaker 1: they are still irrational behavior from some companies to say 334 00:20:10,000 --> 00:20:12,760 Speaker 1: we would bid whatever it takes. If we are pressure 335 00:20:12,800 --> 00:20:15,480 Speaker 1: as a developer, what will we do. We'll put huge 336 00:20:15,480 --> 00:20:19,040 Speaker 1: pressure on Vestas and other turbine suppliers such as Siemens, 337 00:20:19,080 --> 00:20:23,600 Speaker 1: Caamazer or General Electric. They already lose money, so that 338 00:20:23,640 --> 00:20:26,600 Speaker 1: will mean that the health of the industry would be 339 00:20:26,600 --> 00:20:29,200 Speaker 1: put under further pressure. It's such a strange thing though, 340 00:20:29,320 --> 00:20:32,399 Speaker 1: I mean, an industry that's so much in demand, is 341 00:20:32,400 --> 00:20:36,440 Speaker 1: producing clean power that the world needs, is doing it 342 00:20:36,560 --> 00:20:40,800 Speaker 1: at scale in tens of countries around the world is 343 00:20:40,840 --> 00:20:45,600 Speaker 1: being hit by its own success and if the numbers 344 00:20:45,640 --> 00:20:49,920 Speaker 1: you're talking about are right, could collapse. See, I'm fundamentally 345 00:20:49,920 --> 00:20:52,960 Speaker 1: and i'm what I call myself a pragmatic optimist. This 346 00:20:53,040 --> 00:20:57,800 Speaker 1: industry offshore and renewables in general is probably the fastest 347 00:20:57,880 --> 00:21:01,680 Speaker 1: growing industry anywhere in the world. A glimmer of hope, 348 00:21:02,240 --> 00:21:04,840 Speaker 1: which is a big glimmer of hope, is that an 349 00:21:04,880 --> 00:21:08,280 Speaker 1: onshore which has a much shorter cycle from when you 350 00:21:08,320 --> 00:21:09,960 Speaker 1: approve it and when you build it and when you 351 00:21:09,960 --> 00:21:13,360 Speaker 1: sell the power. We see that the price that's being 352 00:21:13,359 --> 00:21:17,200 Speaker 1: paid for the power moves completely intended with inflation because 353 00:21:17,280 --> 00:21:20,159 Speaker 1: the corporate off takers of power, utility off takers of 354 00:21:20,200 --> 00:21:24,040 Speaker 1: the power, they know that the power has to have 355 00:21:24,160 --> 00:21:26,960 Speaker 1: realistic prices. And by the way, it's a power price 356 00:21:27,040 --> 00:21:29,520 Speaker 1: that is less than a fifth of the current power price. 357 00:21:29,680 --> 00:21:32,600 Speaker 1: So it's still a bargain to get tens of years 358 00:21:32,680 --> 00:21:37,840 Speaker 1: of what is comparatively to right now super cheap power offshore. 359 00:21:38,240 --> 00:21:41,200 Speaker 1: Right now, we have governments who have talked themselves into 360 00:21:41,240 --> 00:21:44,439 Speaker 1: a narrative it can only go down. Countries need to 361 00:21:44,440 --> 00:21:47,320 Speaker 1: look at the societal benefits, so how many jobs are 362 00:21:47,359 --> 00:21:51,080 Speaker 1: created are the export industries created. Do we have companies 363 00:21:51,080 --> 00:21:55,840 Speaker 1: invested in biodiversities we see better ocean biodiversity. Do we 364 00:21:55,960 --> 00:22:00,200 Speaker 1: ensure that there's social justice in the transformation, if that's 365 00:22:00,200 --> 00:22:03,280 Speaker 1: to become a criteria rather than only putting pressure on price, 366 00:22:04,080 --> 00:22:06,720 Speaker 1: that is a time with this industry will really start 367 00:22:06,800 --> 00:22:08,960 Speaker 1: to not only grow because it will grow, but grow 368 00:22:09,000 --> 00:22:11,360 Speaker 1: in a healthy way. But we should also just think 369 00:22:11,400 --> 00:22:14,720 Speaker 1: about economics, because economics drives a lot of the markets. 370 00:22:16,040 --> 00:22:18,399 Speaker 1: You're talking about not going to the race to the 371 00:22:18,440 --> 00:22:22,080 Speaker 1: bottom on absolute power prices, but the relative which is 372 00:22:22,119 --> 00:22:27,719 Speaker 1: the difference between offshore and gas or coal is growing. 373 00:22:28,000 --> 00:22:30,919 Speaker 1: And so because gas and coal are currently expensive, yes, 374 00:22:31,080 --> 00:22:33,680 Speaker 1: even though wind power prices are going up a little 375 00:22:33,720 --> 00:22:37,480 Speaker 1: bit more because of inflation, because of supply chain issues, 376 00:22:38,840 --> 00:22:42,440 Speaker 1: the delta the difference between those prices has only grown. 377 00:22:42,480 --> 00:22:45,560 Speaker 1: That should make offshore more attract That's my very point. 378 00:22:46,160 --> 00:22:48,960 Speaker 1: That's my very point is that if there was rational 379 00:22:49,080 --> 00:22:54,000 Speaker 1: behavior from all relevant governments, they would say that since 380 00:22:54,040 --> 00:22:56,760 Speaker 1: the fossil few prices of energy have only gone up, 381 00:22:57,720 --> 00:23:01,359 Speaker 1: then it is actually a smart thing to accept that 382 00:23:01,400 --> 00:23:05,720 Speaker 1: the prices off shore and onshore will go up comparatively 383 00:23:06,640 --> 00:23:10,880 Speaker 1: and until and I'm convinced that will happen, until government 384 00:23:10,960 --> 00:23:14,000 Speaker 1: buyers will realize that the price will have to be 385 00:23:14,040 --> 00:23:17,880 Speaker 1: more realistic, which will still be significantly cheaper than any 386 00:23:18,320 --> 00:23:22,080 Speaker 1: fossil fuel. There will be a risk that things will 387 00:23:22,160 --> 00:23:26,240 Speaker 1: slow down and even some projects potentially not built. We 388 00:23:26,280 --> 00:23:29,320 Speaker 1: saw some colleagues in the US going out and saying, 389 00:23:29,680 --> 00:23:32,119 Speaker 1: we're not sure we can build these projects. So that 390 00:23:32,280 --> 00:23:35,640 Speaker 1: is the risk of a slowdown. But is the growth 391 00:23:35,680 --> 00:23:40,040 Speaker 1: potential of offshore is that going to be realized on 392 00:23:40,119 --> 00:23:43,600 Speaker 1: the long term? Absolutely? Well, you didn't ring up one 393 00:23:43,680 --> 00:23:47,080 Speaker 1: risk factor, which is that big oil companies are coming 394 00:23:47,080 --> 00:23:50,920 Speaker 1: into this space and they have very deep pockets. How 395 00:23:50,960 --> 00:23:53,919 Speaker 1: are you going to deal with those companies being okay 396 00:23:54,040 --> 00:23:56,720 Speaker 1: not making money on off shore for a while and 397 00:23:56,840 --> 00:23:59,960 Speaker 1: maybe eating into your share. But see, that is where 398 00:24:00,080 --> 00:24:02,719 Speaker 1: we have the privilege of having more than fifty gigawatts 399 00:24:02,840 --> 00:24:07,359 Speaker 1: of pipeline. We recently said no to participate in a 400 00:24:07,400 --> 00:24:09,960 Speaker 1: Taiwanese auction, even though we are the biggest by far 401 00:24:10,000 --> 00:24:13,040 Speaker 1: the biggest developer there, because we couldn't make a good 402 00:24:13,080 --> 00:24:17,840 Speaker 1: project there. And the market leader has many responsibilities, and 403 00:24:17,920 --> 00:24:19,920 Speaker 1: one of them is to also say no when things 404 00:24:19,920 --> 00:24:22,520 Speaker 1: are not sustainable. And I don't want to sound arrogant, 405 00:24:22,560 --> 00:24:26,080 Speaker 1: but having built close to thirty utility scale also wind farms, 406 00:24:26,280 --> 00:24:29,200 Speaker 1: we know better than anybody else what is realistic. Economies 407 00:24:29,240 --> 00:24:31,480 Speaker 1: that are not so when we say no, the industry 408 00:24:31,480 --> 00:24:34,359 Speaker 1: can trust that that is what's realistic. Are you worried 409 00:24:34,400 --> 00:24:38,439 Speaker 1: that having oil companies come in will slow down your growth, 410 00:24:38,560 --> 00:24:42,040 Speaker 1: will eat up into your pipeline. The short answer is no, 411 00:24:42,560 --> 00:24:45,919 Speaker 1: because we believe that many opportunities. I mean, for example, 412 00:24:45,960 --> 00:24:49,160 Speaker 1: in the UK we will build the Haunts three, which 413 00:24:49,160 --> 00:24:51,840 Speaker 1: is the world's largest offshore prouty with two point eight gigawatts. 414 00:24:52,200 --> 00:24:55,360 Speaker 1: We still have haun C four. We got a gigawatts 415 00:24:56,040 --> 00:25:00,480 Speaker 1: in scott Wind, so even there there sample opportunity. Worth 416 00:25:00,520 --> 00:25:03,639 Speaker 1: noting that when the UK held its recent seabed rights 417 00:25:03,640 --> 00:25:06,760 Speaker 1: auction for offshore wind, more than half the beds were 418 00:25:06,800 --> 00:25:10,640 Speaker 1: won by oil and gas companies, specifically BP and Total. 419 00:25:11,560 --> 00:25:15,360 Speaker 1: Could there be a scenario where some countries turn out 420 00:25:15,359 --> 00:25:18,919 Speaker 1: to be less attractive than they usually happen? Yes, that 421 00:25:19,000 --> 00:25:21,639 Speaker 1: could happen. I won't point to anything specific, but if 422 00:25:21,680 --> 00:25:24,879 Speaker 1: that happens, the great thing is that all over the 423 00:25:24,880 --> 00:25:27,960 Speaker 1: world we're seeing offshore being really, really wanted to grow. 424 00:25:28,400 --> 00:25:31,639 Speaker 1: So if some of those countries do not get it, 425 00:25:32,240 --> 00:25:34,360 Speaker 1: or if the competition means that there are no good 426 00:25:34,359 --> 00:25:38,160 Speaker 1: projects there, then we will turn our capital to other markets. 427 00:25:38,160 --> 00:25:41,320 Speaker 1: And that's the great privilege of being a globally present developer. 428 00:25:41,480 --> 00:25:45,200 Speaker 1: There's also competition not just in oil companies coming and 429 00:25:45,280 --> 00:25:49,240 Speaker 1: taking seabed rights, but they're also taking many of the 430 00:25:49,320 --> 00:25:52,560 Speaker 1: executives that work in austed and there's been quite a 431 00:25:52,640 --> 00:25:56,239 Speaker 1: churn in ousted in the leadership ranks. How are you 432 00:25:56,280 --> 00:25:59,919 Speaker 1: dealing with the talent pool issue? Well, in general, as 433 00:26:00,040 --> 00:26:02,520 Speaker 1: an industry, we need to ensure that we continue to 434 00:26:02,560 --> 00:26:05,560 Speaker 1: build not just strong executives, but really really strong talent 435 00:26:05,920 --> 00:26:08,080 Speaker 1: because right now I think there are twelve million people 436 00:26:08,080 --> 00:26:11,520 Speaker 1: employed in renewables around the world. In eight years there's 437 00:26:11,560 --> 00:26:14,439 Speaker 1: going to be a thirty eight million. That's projection. So 438 00:26:14,480 --> 00:26:16,439 Speaker 1: in general, we in the industry need to take a 439 00:26:16,520 --> 00:26:22,280 Speaker 1: huge responsibility for educating, retraining lots of workforce. Allstar as 440 00:26:22,280 --> 00:26:24,399 Speaker 1: I'm too. You know, we are twice as big as 441 00:26:24,400 --> 00:26:27,200 Speaker 1: the second biggest and offshore we've been in this for longest, 442 00:26:27,400 --> 00:26:29,720 Speaker 1: so we have a deep capability at all levels in 443 00:26:29,720 --> 00:26:34,080 Speaker 1: the organization. That means our employees are attractive. I obviously 444 00:26:34,119 --> 00:26:37,080 Speaker 1: don't like it because I would love to keep our people. 445 00:26:37,359 --> 00:26:39,080 Speaker 1: But on the other hand, I know they are great 446 00:26:39,119 --> 00:26:41,480 Speaker 1: people with good values. So if they can get in 447 00:26:41,480 --> 00:26:44,639 Speaker 1: into another company and help them accelerate again as a 448 00:26:44,720 --> 00:26:46,720 Speaker 1: world citizen, I love that you've been in the off 449 00:26:46,720 --> 00:26:50,000 Speaker 1: shore industry the longest. New players are coming left, right 450 00:26:50,040 --> 00:26:54,359 Speaker 1: and center. Why is it so easy for them to 451 00:26:54,440 --> 00:26:56,840 Speaker 1: come in and eat your lunch. I'm not sure it 452 00:26:56,960 --> 00:27:00,320 Speaker 1: is as easy as it sounds, because if you look 453 00:27:00,359 --> 00:27:04,080 Speaker 1: at who actually builds something at scale, there aren't that 454 00:27:04,240 --> 00:27:07,160 Speaker 1: many of us. If you look at how many people 455 00:27:07,160 --> 00:27:09,480 Speaker 1: are bidding in, if you look at how many people 456 00:27:09,560 --> 00:27:12,040 Speaker 1: saying they have off show ambitions, there are a lot. 457 00:27:12,760 --> 00:27:14,800 Speaker 1: But if you look at how many people actually have 458 00:27:14,880 --> 00:27:19,479 Speaker 1: operational or under construction assets at scale, they aren't that many. 459 00:27:19,840 --> 00:27:22,280 Speaker 1: So I think we will see an industry which will 460 00:27:22,320 --> 00:27:26,080 Speaker 1: also sort of mature and saying some of those who 461 00:27:26,160 --> 00:27:29,000 Speaker 1: came in found out it wasn't exactly as easy, And 462 00:27:29,200 --> 00:27:34,600 Speaker 1: I greatly respect competitors, and I'll call them industry colleagues 463 00:27:34,920 --> 00:27:38,200 Speaker 1: who come in who are serious, who know what they're doing, 464 00:27:38,800 --> 00:27:40,640 Speaker 1: they want to do it in the right way. Both 465 00:27:40,640 --> 00:27:43,480 Speaker 1: from a sustainability and a financial point of view, and 466 00:27:43,520 --> 00:27:46,080 Speaker 1: they stay in the industry. But those who come in 467 00:27:46,480 --> 00:27:48,639 Speaker 1: try to make a big box, develop a project and 468 00:27:48,720 --> 00:27:51,800 Speaker 1: sell it again. It's okay if they don't stay for 469 00:27:51,840 --> 00:27:57,520 Speaker 1: the long term. Thank you so much for your time. 470 00:27:57,560 --> 00:27:59,880 Speaker 1: This is a great conversation. My pleasure. I'm sorry about 471 00:27:59,880 --> 00:28:13,520 Speaker 1: my sore throat. The story of oysters transformation from a 472 00:28:13,520 --> 00:28:16,840 Speaker 1: fosso fuel company to a clean energy company was anything 473 00:28:16,960 --> 00:28:20,879 Speaker 1: but straight up corporate strategy. It also needed state intervention 474 00:28:21,119 --> 00:28:24,960 Speaker 1: and happy accidents. Lots of fossil fuel companies will have 475 00:28:25,000 --> 00:28:27,880 Speaker 1: to undergo a similar transition over the coming decades. If 476 00:28:27,920 --> 00:28:31,240 Speaker 1: we are to reach zero emissions, we cannot rely on 477 00:28:31,359 --> 00:28:35,000 Speaker 1: happy accidents alone. And just a side note, the research 478 00:28:35,040 --> 00:28:37,280 Speaker 1: for this telling of the Oyster story is based on 479 00:28:37,359 --> 00:28:39,840 Speaker 1: work I did for my book on climate solutions that 480 00:28:39,920 --> 00:28:42,760 Speaker 1: will be published later this year. I hope you'll give 481 00:28:42,800 --> 00:28:45,960 Speaker 1: that a read when it's out. Thanks for listening to Zero. 482 00:28:46,200 --> 00:28:48,200 Speaker 1: If you like this episode, please take a moment to 483 00:28:48,320 --> 00:28:51,080 Speaker 1: rate and review the show on Apple Podcasts and Spotify, 484 00:28:51,960 --> 00:28:54,680 Speaker 1: Send it to a friend, or whisper it into the wind. 485 00:28:55,160 --> 00:28:57,240 Speaker 1: If you've got a suggestion for a guest or topic 486 00:28:57,400 --> 00:28:59,840 Speaker 1: or something you just want us to look into. Get 487 00:29:00,000 --> 00:29:03,720 Speaker 1: in touch at zeropod, at Bloomberg dot Net. Zero's producer 488 00:29:03,840 --> 00:29:07,440 Speaker 1: is Oscar Boyd and senior producer is Christine driscoll Our. 489 00:29:07,480 --> 00:29:10,920 Speaker 1: Theme music is composed by Wonderlely Special thanks to Kira 490 00:29:11,000 --> 00:29:14,320 Speaker 1: bin Ram and to energy reporter Will Mathis. If you'd 491 00:29:14,320 --> 00:29:16,400 Speaker 1: like to read more stories from him about the state 492 00:29:16,440 --> 00:29:19,000 Speaker 1: of the wind industry, We've linked some of those in 493 00:29:19,040 --> 00:29:22,360 Speaker 1: the show notes. I'm Kshatrati back next week.