WEBVTT - Bloomberg Businessweek Weekend - December 19th, 2025 0:00:00.280 --> 0:00:07.240 Bloomberg Audio Studios, Podcasts, radio news. 0:00:08.640 --> 0:00:13.000 This is Bloomberg Business Week Daily reporting from the magazine 0:00:13.000 --> 0:00:17.599 that helps global leaders stay ahead with insight on the people, companies, 0:00:17.640 --> 0:00:22.520 and trends shaping today's complex economy. Plus global business, finance 0:00:22.560 --> 0:00:25.880 and tech news as it happens. The Bloomberg Business Week 0:00:25.960 --> 0:00:31.320 Daily Podcast with Carol Masser and Tim Stenebek on Bloomberg Radio. 0:00:32.159 --> 0:00:35.520 Hi, everyone, Welcome to the Bloomberg Business Wee Weekend Podcast. Well, 0:00:35.600 --> 0:00:38.040 another busy week on Wall Street. It was the last 0:00:38.080 --> 0:00:40.600 full week of trading in twenty twenty five. Hard to 0:00:40.600 --> 0:00:44.080 believe with investors parsing a few more earnings, and we 0:00:44.200 --> 0:00:46.839 got some data from the government on US jobs and 0:00:46.880 --> 0:00:49.920 inflation and what all of this might mean for FED 0:00:49.960 --> 0:00:52.160 policy in twenty twenty six. A lot to think about 0:00:52.360 --> 0:00:54.760 as we get ready for a new year. Another thing, 0:00:55.000 --> 0:00:57.480 who will be the next chair of the US Central 0:00:57.480 --> 0:01:00.000 Bank in twenty twenty six? On the latter, the whole 0:01:00.080 --> 0:01:03.360 spreading around that seemed to be in flux, kind of changing. 0:01:03.600 --> 0:01:05.360 For the latest on all of this, though, check it 0:01:05.360 --> 0:01:08.480 out on the Bloomberg terminal and at Bloomberg dot com. 0:01:08.400 --> 0:01:11.240 For a macro view of the economy, the underlying risks 0:01:11.240 --> 0:01:14.200 and the health of the banking sector, private credit, and AI. 0:01:14.640 --> 0:01:17.640 We caught up again with former investment banker Chris Whalen. 0:01:17.800 --> 0:01:19.960 That conversation in just a minute plus. 0:01:20.000 --> 0:01:22.479 The surge for power, getting the grids ready for it, 0:01:22.520 --> 0:01:26.440 and why these energy demands could slow down global economic growth. 0:01:26.680 --> 0:01:29.000 We get into that with the president of National Grid 0:01:29.080 --> 0:01:29.520 New York. 0:01:29.800 --> 0:01:33.520 And bitcoin, the notorious energy consumer headed for its fourth 0:01:33.560 --> 0:01:37.760 annual decline in its history. Could bitcoin fatigue be setting 0:01:37.840 --> 0:01:38.800 in on the industry. 0:01:39.040 --> 0:01:42.200 Then in our second hour, the cost of celebrating Christmas. 0:01:42.319 --> 0:01:42.960 It's climbing it. 0:01:42.840 --> 0:01:44.000 It depends on what you're buying. 0:01:45.640 --> 0:01:48.840 Hint hint, gold rings. Yeah, kind of pricey. All right, 0:01:48.880 --> 0:01:51.120 we're going to get into that. We're also going to 0:01:51.120 --> 0:01:53.240 get into what it may take to get the perfect 0:01:53.240 --> 0:01:55.920 custom ski boots by the way, Tim knows a little 0:01:55.960 --> 0:01:58.160 bit about that. And then we get the market for 0:01:58.240 --> 0:02:00.680 big experiences bane. 0:02:00.600 --> 0:02:02.720 All that to Colm. We begin with the macro and 0:02:02.760 --> 0:02:05.920 the micro, from private credit to banking and yes, even 0:02:05.960 --> 0:02:08.880 some AI. With someone who we turn to a lot 0:02:09.240 --> 0:02:11.880 during the Great Financial Crisis, we're talking about Chris Whalen. 0:02:11.960 --> 0:02:14.640 He is chairman of Whalen Global advisors. He worked at 0:02:14.639 --> 0:02:16.600 the New York Fed in the nineteen eighties. He has 0:02:16.639 --> 0:02:20.040 testified before Congress and the SEC. He worked on Wall 0:02:20.120 --> 0:02:23.760 Street at such storied firms that are no longer around. 0:02:23.800 --> 0:02:27.320 We're talking about Bear Stearns and Prudential securities. Chris is 0:02:27.360 --> 0:02:31.760 also co founder of the Institutional Risk Analytics newsletter It's eerie. 0:02:31.919 --> 0:02:36.399 The credit costs are trending down. Asset returns, thank god, 0:02:36.400 --> 0:02:39.080 are getting back to normal about one point five percent. 0:02:39.560 --> 0:02:42.440 But there's a lot we don't see, and that's what's 0:02:42.520 --> 0:02:45.440 worrying people. Whether you talk about Oracle, where you talk 0:02:45.480 --> 0:02:48.560 about private credit, what people are worried about today is 0:02:48.560 --> 0:02:51.200 what they don't see in the data because they know 0:02:51.280 --> 0:02:53.639 that a lot of this is being fudged. And that's 0:02:53.680 --> 0:02:55.000 what worries me as well. 0:02:55.200 --> 0:02:58.760 What do you think is being fudged things like loan losses. 0:02:59.200 --> 0:03:01.280 There's a lot of four bearents here in New York 0:03:01.360 --> 0:03:05.079 City for multi family apartments. Our new mayor is threatening 0:03:05.160 --> 0:03:08.440 to start taking over buildings the landlords are not keeping 0:03:08.520 --> 0:03:10.680 up to his standards. Well, the city in New York 0:03:10.720 --> 0:03:13.160 can't afford to take care of them either, and so 0:03:13.240 --> 0:03:17.160 we have this accumulation of pressures mostly caused by inflation, 0:03:18.080 --> 0:03:21.080 mostly caused by our friends at the FED. But in 0:03:21.120 --> 0:03:23.840 their defense, why did they do that? Because we told 0:03:23.840 --> 0:03:26.040 everybody they didn't have to pay their loans and their 0:03:26.040 --> 0:03:30.000 rent for two years during COVID. People forget that. In 0:03:30.040 --> 0:03:32.760 the mortgage industry in March of twenty twenty, we were 0:03:32.760 --> 0:03:35.360 all looking at one another going, what are we going 0:03:35.440 --> 0:03:38.520 to do? This is after President Trump declared the emergency 0:03:38.520 --> 0:03:41.440 and said, you don't have to pay your bills. Yeah, Well, 0:03:41.480 --> 0:03:44.440 the FED came to the rescue by dropping raised to zero. 0:03:44.520 --> 0:03:48.880 We cause a surge of home lending activity, record volumes, 0:03:49.160 --> 0:03:52.960 and that float was borrowed to help everybody pay their bills. 0:03:53.120 --> 0:03:55.240 So why aren't we seeing more stress in the credit markets? 0:03:55.240 --> 0:03:57.200 And why are we seeing records on Wall Street? And 0:03:57.240 --> 0:03:59.280 like it sounds like then some disconnect. 0:04:00.080 --> 0:04:01.880 I think part of the reason that the Street has 0:04:01.920 --> 0:04:04.800 been doing well listed stocks is because you have a 0:04:04.840 --> 0:04:08.360 lot of liquidity coming out of private markets. Going back 0:04:08.400 --> 0:04:13.080 into more liquid markets makes sense, right. Private equity private 0:04:13.120 --> 0:04:15.520 credit is a mess, and we all know this. Something 0:04:15.600 --> 0:04:18.839 like fifteen percent of private equity companies in the US 0:04:18.960 --> 0:04:23.839 are paying in kind rather than in cash. So you notice, waiting. 0:04:23.520 --> 0:04:26.120 For the year to like the exits and for things 0:04:26.120 --> 0:04:26.560 to move on. 0:04:26.920 --> 0:04:30.440 There's a lack of demand from banks for loans except 0:04:30.440 --> 0:04:34.680 in one category, non depository financial companies, which is another 0:04:34.720 --> 0:04:38.240 way of saying private equity funds, credit shops like Areas 0:04:38.279 --> 0:04:41.920 and Apollo. They're the ones that have been aggressively expanding 0:04:42.200 --> 0:04:45.279 their business using money in part from banks. So the 0:04:45.279 --> 0:04:48.159 banks are now the facilitators. And what does this remind 0:04:48.240 --> 0:04:50.080 us of Carol the two thousands? 0:04:50.120 --> 0:04:50.960 Right right? 0:04:51.040 --> 0:04:54.400 It's the same thing. You have non bank intermediation, relying 0:04:54.680 --> 0:04:57.920 on the bond market, equity markets, and bank credit. And 0:04:57.960 --> 0:05:00.640 the thing is eventually they're going to stumble, and that's 0:05:00.680 --> 0:05:01.920 what everybody's worried about it. 0:05:01.960 --> 0:05:03.880 So what does that stumble look like? What is the 0:05:03.960 --> 0:05:05.040 shoe that drops? 0:05:05.160 --> 0:05:09.640 It looks like First Brands, Hello, we're defaulting. And most 0:05:09.640 --> 0:05:12.360 people had never focused on that company. It was a private, 0:05:12.920 --> 0:05:17.680 totally institutional play. The same thing with Tricolor auto lender 0:05:17.760 --> 0:05:21.200 that you know half of their customers were illegal aliens 0:05:21.520 --> 0:05:23.600 that nobody had ever focused on this. It was an 0:05:23.600 --> 0:05:25.880 institutional story that suddenly surged. 0:05:26.160 --> 0:05:29.560 So you think those two instances are canaries in the 0:05:29.560 --> 0:05:30.240 coal mine. 0:05:30.400 --> 0:05:32.320 I think they are typical of what we're going to 0:05:32.360 --> 0:05:34.680 see more in the future, which is you're going to 0:05:34.760 --> 0:05:39.279 see more of the missteps in the institutional, non public market, 0:05:39.560 --> 0:05:42.839 which was supposedly better. Remember everybody was selling us the 0:05:42.920 --> 0:05:45.800 idea that private was better than public. No, we have 0:05:45.880 --> 0:05:49.159 public markets because they were open and relatively liquid. 0:05:49.520 --> 0:05:52.680 Chris, you know after the Jamie Diamond cockroach comment that 0:05:52.720 --> 0:05:55.640 there were many members in the private world that came 0:05:55.640 --> 0:05:57.320 out or a few, I should say, that came on 0:05:57.400 --> 0:06:01.600 our air, and that seemed to say, hey, listen, things 0:06:01.640 --> 0:06:04.640 are fine, And I understand many would say they're talking 0:06:04.680 --> 0:06:08.080 their book, but are they systemic risks, like what's the 0:06:08.160 --> 0:06:11.760 exposure with the traditional financial sector when it comes to 0:06:11.800 --> 0:06:14.200 the private markets, Because I think that's what we care 0:06:14.320 --> 0:06:15.560 most about right now. 0:06:15.720 --> 0:06:20.320 I think the private players can fail tomorrow. It will 0:06:20.360 --> 0:06:24.200 cause a bit of kurffluffle and volatility in the markets. 0:06:24.320 --> 0:06:27.360 But are they systemic like a big bank. No, But 0:06:27.400 --> 0:06:30.120 the big banks will take their lumps too because they 0:06:30.160 --> 0:06:34.280 are lending indirectly into these structures. They tend to take 0:06:34.320 --> 0:06:37.440 the most senior positions, but that may not save them. 0:06:37.839 --> 0:06:41.159 You see the assumption that Okay, I'm senior and three 0:06:41.240 --> 0:06:44.839 quarters of the stack is below me. And therefore I'm okay, 0:06:45.400 --> 0:06:47.520 that may not work this time around because you have 0:06:47.640 --> 0:06:50.520 leverage on leverage on leverage in some of these deals. 0:06:50.720 --> 0:06:53.240 When so when like the big banks report again, we're 0:06:53.240 --> 0:06:55.479 getting ready for another earning cycle, right, you know, we'll 0:06:55.520 --> 0:06:58.920 get that, you know, in early early January. So what 0:06:58.960 --> 0:07:01.159 do we look for for things like that? Like, what 0:07:01.200 --> 0:07:01.800 do you look for? 0:07:02.040 --> 0:07:05.560 Yours are going to be wonderful. That's what worries me, 0:07:05.960 --> 0:07:07.920 you know, just as an analyst. We were supposed to 0:07:07.960 --> 0:07:12.200 have a recession last year. Credit losses largely peaked last 0:07:12.240 --> 0:07:15.840 year third fourth quarter. Yeah, they've been coming down since then. 0:07:16.080 --> 0:07:18.120 So if you look at the picture, you say, god, 0:07:18.160 --> 0:07:21.000 everything is great. You don't see a lot of utilization. 0:07:21.320 --> 0:07:23.640 You don't see a lot of demand from the banks 0:07:23.680 --> 0:07:26.560 for credit. They've got a ton of unused credit out 0:07:26.600 --> 0:07:29.240 there that they wish people would use. But so you 0:07:29.280 --> 0:07:32.520 don't see stress in the published numbers. Where you see 0:07:32.520 --> 0:07:35.640 stresses when you talk to professionals, when you read the 0:07:36.200 --> 0:07:39.920 really interesting media like Bloomberg and others that cover some 0:07:40.000 --> 0:07:42.160 of these stories. There was a great piece in the 0:07:42.240 --> 0:07:46.160 Ft talking about Altus, a company that Jamie Dimond came 0:07:46.200 --> 0:07:49.920 to the rescue of paid off their most restrictive loans 0:07:50.240 --> 0:07:53.040 so that they go out and borrow my money's right, 0:07:53.160 --> 0:07:55.520 And all of the credit guys that you're talking about 0:07:55.560 --> 0:07:58.200 look at Jamie Dimond and they're going, hello. 0:07:58.120 --> 0:07:58.840 What are you doing? 0:07:59.160 --> 0:08:03.320 Yeah, he he's an enabler of bad behavior because Jamie 0:08:03.360 --> 0:08:05.320 has to go out and make money too in a 0:08:05.400 --> 0:08:08.200 market where there isn't a lot of what I would 0:08:08.240 --> 0:08:10.360 call quality demand, which reminds me. 0:08:10.360 --> 0:08:12.840 Of what would happen in the Great Financial Crisis of 0:08:12.880 --> 0:08:16.120 people saying, I know it's getting messy and ugly, but 0:08:16.240 --> 0:08:18.840 there was it. The CEO of City at the time, 0:08:18.840 --> 0:08:20.400 I think who I came out and made some comment 0:08:20.400 --> 0:08:21.520 about I got. 0:08:21.360 --> 0:08:22.720 To be in it, yes and no. 0:08:23.120 --> 0:08:26.600 I think that some institutions have the common sense to 0:08:26.960 --> 0:08:30.280 pull back and say no, others don't. I'll give you 0:08:30.320 --> 0:08:32.720 an example p and C. P and C has the 0:08:32.760 --> 0:08:35.600 lowest loss rate in the top seven banks. They've always 0:08:35.920 --> 0:08:38.560 also got one of the lowest funding costs. That's a 0:08:38.640 --> 0:08:43.200 fairly well run half trillion dollar bank that has managed 0:08:43.240 --> 0:08:46.120 to avoid risk. I think often by saying no, the 0:08:46.160 --> 0:08:48.720 street wanted them to get more involved in certain things 0:08:48.760 --> 0:08:52.200 like prime brokerage, dealing with private equity funds, that sort 0:08:52.240 --> 0:08:55.040 of thing, and they said no. So I think there 0:08:55.080 --> 0:08:57.920 are institutions that are very well run in this market. 0:08:58.080 --> 0:09:00.880 But again, the banks are under utili because the non 0:09:00.920 --> 0:09:04.439 bank financial companies have stolen their march and they are 0:09:04.440 --> 0:09:07.880 going to the customer and they're using wholesale funding from 0:09:07.960 --> 0:09:11.000 the big banks and they're in turn dis intermediating them. 0:09:11.000 --> 0:09:13.319 At the same tone, Chris, we want to talk a 0:09:13.360 --> 0:09:15.560 little bit about AI too in the time that we 0:09:15.640 --> 0:09:19.559 have left. We've talked about it with you before circular financing. 0:09:19.600 --> 0:09:21.400 We're not sure how it all plays out in the 0:09:21.440 --> 0:09:23.680 economy and what it has to do with productivity and 0:09:23.760 --> 0:09:26.880 with economic growth. Weighing in on AI and its potential 0:09:26.880 --> 0:09:30.640 economic impact. Ken Griffin of Citadel speaking with Bloomberg's Danny 0:09:30.679 --> 0:09:33.000 Berger the conference in Paris. Check out what he said. 0:09:33.240 --> 0:09:36.400 I think there is some chance that we will see 0:09:36.440 --> 0:09:40.880 meaningful progress in this field that will change the calculation 0:09:41.000 --> 0:09:43.839 that i'm or calculus that I'm setting forth, Like there 0:09:43.840 --> 0:09:46.680 are so many bright people in their twenties and thirties 0:09:47.240 --> 0:09:51.920 trying to unlock trying to unlock true intelligence that this 0:09:52.040 --> 0:09:54.840 does create the environment in which a breakthrough may happen. 0:09:55.400 --> 0:09:57.240 But I think that generit of AI as we know 0:09:57.400 --> 0:10:02.959 today will have a very pointed, but relatively limited impact 0:10:03.000 --> 0:10:04.079 on the broader economy. 0:10:04.559 --> 0:10:08.000 Appointed but relatively limited impact on the broader economy. Ken 0:10:08.080 --> 0:10:11.400 Griffin of Citadel, what, in your view is the impact 0:10:11.440 --> 0:10:12.600 of AI on this economy? 0:10:13.000 --> 0:10:15.600 I think it's incremental better search tools. 0:10:15.640 --> 0:10:16.560 You know, we're writers. 0:10:16.679 --> 0:10:19.240 So is he right? I think he is right. And frankly, 0:10:19.320 --> 0:10:21.960 I read a lot of the long haired stuff on 0:10:22.040 --> 0:10:24.920 AI some of the people in the scientific community, and 0:10:24.960 --> 0:10:27.200 they tell you the same thing. Because this is a 0:10:27.240 --> 0:10:29.800 third or four to fifth time that we have talked 0:10:29.800 --> 0:10:32.720 about AI. You go back to the seventies and the eighties. 0:10:33.200 --> 0:10:37.360 Remember Watson IBM, which was a fiasco, but it was 0:10:37.920 --> 0:10:41.480 their way of showing what new technology could do. But 0:10:41.600 --> 0:10:43.880 is it creating general intelligence? 0:10:44.240 --> 0:10:45.600 No? All this waste? 0:10:45.760 --> 0:10:46.400 Is all this waste? 0:10:46.480 --> 0:10:48.440 No, it's marketing, you know, never. 0:10:48.320 --> 0:10:51.360 Yeah, but that's market but to spend, Yeah, but. 0:10:51.320 --> 0:10:55.120 That's Look, everything in the US economy is about marketing. Okay, 0:10:55.320 --> 0:10:57.400 it doesn't matter what it is. And if it's attached 0:10:57.400 --> 0:11:01.040 to a stock, then you know it's marketing. I've made 0:11:01.040 --> 0:11:03.000 a ton of money on in video. I'm very grateful 0:11:03.000 --> 0:11:05.719 to mister Wang, but is he going to change the world. No, 0:11:06.120 --> 0:11:08.880 what we're doing is building a lot of infrastructure. We're 0:11:08.920 --> 0:11:12.000 spending a ton of money, not so much on building AI, 0:11:12.360 --> 0:11:16.480 but preparing to have the capacity to do it, mostly 0:11:16.520 --> 0:11:17.680 by studying the past. 0:11:18.320 --> 0:11:19.480 To me, that's not AI. 0:11:19.920 --> 0:11:23.040 AI is when a machine can start to observe what's 0:11:23.080 --> 0:11:27.199 around it and react and determine what to do next 0:11:27.240 --> 0:11:30.480 based on what it sees, not because of you know, 0:11:30.520 --> 0:11:33.040 it's studied our language for the last fifty years, so 0:11:33.080 --> 0:11:33.760 you're understood. 0:11:33.760 --> 0:11:35.360 Like the whole idea of AI is all the data 0:11:35.400 --> 0:11:37.960 that's put in from the past. Do you think that, Okay, 0:11:38.520 --> 0:11:39.640 that's your takes. 0:11:39.280 --> 0:11:39.880 All we have? 0:11:41.760 --> 0:11:42.960 Are you still on video? 0:11:43.480 --> 0:11:43.640 No? 0:11:43.720 --> 0:11:45.840 I got out, I got out, I wrote it up. 0:11:45.880 --> 0:11:48.120 It's split. I wrote it up again. It's split. But 0:11:48.240 --> 0:11:50.160 it gets to be a third of my portfolio. I've 0:11:50.200 --> 0:11:52.960 got to take the money and run, you know. With 0:11:53.080 --> 0:11:55.760 all due respect to Jim Kramer, who I'm very grateful 0:11:55.800 --> 0:11:57.559 to for getting me into the stock, but. 0:11:58.080 --> 0:12:00.560 It sounds like you're saying that that we're bubble with 0:12:00.640 --> 0:12:02.439 at least with the spat of course, we are. 0:12:02.679 --> 0:12:05.400 That's what humans do, that's what markets is what happens. 0:12:05.679 --> 0:12:08.840 We follow the shiny object. What happens when the bubble pops. 0:12:09.600 --> 0:12:11.600 We're going to see that a lot of the spend 0:12:11.679 --> 0:12:15.880 for AI will not be compensated with revenue growth that's 0:12:15.920 --> 0:12:18.480 going to help to pay it off. And Oracle, I think, 0:12:18.559 --> 0:12:21.200 unfortunately a great company, is the poster child for this. 0:12:21.640 --> 0:12:24.920 They were following the crowd. They decided to double down 0:12:25.280 --> 0:12:27.880 and do even more. And the truth of the matter 0:12:28.000 --> 0:12:30.640 is one large language model. If all of the tech 0:12:30.640 --> 0:12:34.920 companies have gotten together and said, look, let's do this together, right, right. 0:12:35.040 --> 0:12:36.040 But the other problem I. 0:12:35.960 --> 0:12:38.520 Think is the metaphors that we use in this conversation 0:12:38.760 --> 0:12:42.360 is race with China. The Chinese don't use metaphors like that. 0:12:42.720 --> 0:12:45.680 When you listen to them talk about AI. It's part 0:12:45.679 --> 0:12:49.240 of a broader range of initiatives that they're trying to 0:12:49.360 --> 0:12:52.040 use to give them an advantage in the global economy. 0:12:52.240 --> 0:12:52.959 They don't see it. 0:12:52.920 --> 0:12:53.480 As a race. 0:12:53.760 --> 0:12:56.600 This is all marketing hype, and we have to differentiate 0:12:56.640 --> 0:13:00.880 between the technology and the cell. It's like we used 0:13:00.880 --> 0:13:05.000 to say about a IBM, never mistake sales with delivery. 0:13:05.160 --> 0:13:07.840 No, All right, gott to leave it there. Thank you, Billy, 0:13:07.880 --> 0:13:08.440 appreciate it. 0:13:08.559 --> 0:13:09.080 Good pleasure. 0:13:09.160 --> 0:13:11.800 Chris Whaler and Chairman of Whale and Global Advisors, joining 0:13:11.880 --> 0:13:12.920 us here in studio. 0:13:16.800 --> 0:13:20.800 You're listening to the Bloomberg Business Weekdaily Podcast. Catch us 0:13:20.880 --> 0:13:24.319 live weekday afternoons from two to five pm Eastern. Listen 0:13:24.360 --> 0:13:27.920 on Apple CarPlay and Android Auto with the Bloomberg Business app, 0:13:28.080 --> 0:13:30.439 or watch us live on YouTube. 0:13:30.600 --> 0:13:33.400 Global electricity demand in the US is surging that we 0:13:33.600 --> 0:13:36.840 know as massive data centers for AI begin to pop up. 0:13:37.040 --> 0:13:42.360 EV adoption rises and government incentives are boosting domestic manufacturing. 0:13:42.640 --> 0:13:46.000 All of that putting pressure on the power grid and 0:13:46.040 --> 0:13:50.480 the need for energy. This surge is outpacing older energy plants, 0:13:50.720 --> 0:13:54.360 straining power generation, transmission, and distribution systems. 0:13:54.840 --> 0:13:57.600 A report by the Albany Times Union mentioned National Grid, 0:13:57.720 --> 0:14:00.520 New York and other utilities spending more than four billion 0:14:00.559 --> 0:14:03.360 dollars to prep and modernize New York's electrical grid for 0:14:03.400 --> 0:14:06.840 a generational shift that includes things like AI data centers 0:14:06.840 --> 0:14:07.280 and more. 0:14:07.400 --> 0:14:09.320 The All Many Times Union goes on to say that 0:14:09.360 --> 0:14:12.400 this spending is for investments for which New Yorkers, many 0:14:12.440 --> 0:14:16.040 of whom are already struggling with utility costs will have 0:14:16.120 --> 0:14:18.960 to pay for in the coming years. Now we have 0:14:19.000 --> 0:14:21.000 the perfect voice to talk about all of this. 0:14:21.280 --> 0:14:24.160 Sally Librera, President of National Grid New York. It's the 0:14:24.240 --> 0:14:27.760 subsidiary of the publicly held electricity, natural gas, and clean 0:14:27.840 --> 0:14:31.760 energy utility National Grid. It serves millions in New York 0:14:31.800 --> 0:14:34.240 and Massachusetts. Sally joined us in our studio. 0:14:34.560 --> 0:14:37.240 So at National Grid in New York, we serve more 0:14:37.280 --> 0:14:41.240 than four million customers and we deliver natural gas and 0:14:41.320 --> 0:14:43.920 electricity to those customers, and our focus is on doing 0:14:43.920 --> 0:14:48.760 it safely, reliably and affordably. But the reality is there 0:14:48.920 --> 0:14:54.160 is increasing demand for energy across the entire state, and 0:14:53.360 --> 0:14:56.880 we serve through Upstate, we serve in Long Island, and 0:14:56.880 --> 0:14:59.560 we also serve in New York City, and it's our 0:14:59.680 --> 0:15:03.720 job to deliver that energy to meet that energy demand, where, 0:15:03.880 --> 0:15:05.640 when and how folks need it. 0:15:05.720 --> 0:15:08.120 How would you quantify that demand though, Give us some idea, 0:15:08.120 --> 0:15:11.120 because we're talking NonStop about deals of AI data centers, 0:15:11.120 --> 0:15:13.760 whether it's New York or elsewhere. Give us an idea. 0:15:13.960 --> 0:15:16.360 How stressed is the situation? 0:15:16.720 --> 0:15:19.320 So we work with our New York Independent System Operator, 0:15:19.360 --> 0:15:23.440 the NISO, and NISO manages a what we call the 0:15:23.520 --> 0:15:26.960 large load Q. So it's essentially the companies that have 0:15:27.000 --> 0:15:30.640 indicated wanting to hook into the New York grid that 0:15:30.680 --> 0:15:34.440 have large power needs. And they estimate that the cumulative 0:15:34.680 --> 0:15:37.640 power need across those companies that are essentially in line 0:15:37.680 --> 0:15:40.040 to connect sometime over the next five or so years 0:15:40.480 --> 0:15:43.760 is about ten gigawatts of energy. And so just to 0:15:43.760 --> 0:15:47.200 give you some context, at our peak in New York, 0:15:47.600 --> 0:15:51.480 we demand about three times that across the entire state. 0:15:51.920 --> 0:15:56.280 And another really important point is that one year ago 0:15:56.600 --> 0:16:00.480 that Q was one third the size. It literally tripled 0:16:00.680 --> 0:16:01.960 in just one year. 0:16:02.120 --> 0:16:04.800 All data centers, no, not all database What is it done? 0:16:04.840 --> 0:16:07.480 Because it does seem like for many years we thought 0:16:07.520 --> 0:16:11.640 that power demand across the country would actually stay relatively flat, 0:16:11.640 --> 0:16:15.200 and it did stay relatively flat, but just in recent 0:16:15.240 --> 0:16:17.000 years we've seen so much of an uptick in demand. 0:16:17.000 --> 0:16:18.760 What are you seeing on your grids? 0:16:19.120 --> 0:16:22.400 Well, there's definitely there, definitely is the impact of data centers. 0:16:22.880 --> 0:16:26.720 But New York is also very attractive to manufacturing and 0:16:27.400 --> 0:16:31.080 large scale manufacturing, particularly some of the modern manufacturing we 0:16:31.080 --> 0:16:36.200 see around semiconductors and computer components. It's very energy intensive, 0:16:36.480 --> 0:16:39.280 and companies with big power needs are drawn to New York, 0:16:39.920 --> 0:16:42.280 and we are working to make sure that they have 0:16:42.320 --> 0:16:44.160 the power that they need, not just today but well 0:16:44.200 --> 0:16:44.880 into the future. 0:16:45.000 --> 0:16:47.600 So it's interesting, right because we think about this White House, 0:16:47.680 --> 0:16:51.400 right and encouraging investment from foreign companies to build here. 0:16:51.760 --> 0:16:53.840 I mean, I guess you know that's the good thing, right, 0:16:53.880 --> 0:16:57.680 We want to see other companies investing into the United States. 0:16:57.720 --> 0:17:00.760 But there's a power grab on that right as a 0:17:00.760 --> 0:17:02.800 result of that. In order to meet that. 0:17:02.840 --> 0:17:04.840 I think it is important to note that even if 0:17:04.880 --> 0:17:08.720 we weren't at this unique moment in time with rapidly 0:17:08.760 --> 0:17:12.080 increasing demand for power, we still have a grid in 0:17:12.160 --> 0:17:14.879 New York and this is true across many places in 0:17:14.920 --> 0:17:17.919 the country. We have a grid that needs investment. We 0:17:17.960 --> 0:17:21.000 have assets that are close to one hundred years old. 0:17:21.119 --> 0:17:23.800 Why right, right? Tim Like? How many people like, why 0:17:24.600 --> 0:17:26.440 if it's one hundred years old, why are you twenty 0:17:26.520 --> 0:17:26.920 years ago? 0:17:27.359 --> 0:17:28.800 Right? Why did we make the investment? 0:17:28.800 --> 0:17:28.960 Then? 0:17:29.160 --> 0:17:33.400 Yeah, we have been very careful about balancing the bill 0:17:33.440 --> 0:17:36.840 impacts which customers bear with the investments that we make 0:17:36.840 --> 0:17:39.639 in our infrastructure. And even today, where we look at 0:17:39.680 --> 0:17:42.639 assets that are seventy eighty one hundred years old, we're 0:17:42.760 --> 0:17:47.040 very strategic and pinpointed about which of those assets, which 0:17:47.080 --> 0:17:50.400 of those parts of infrastructure we replace, because we want 0:17:50.440 --> 0:17:53.160 to keep customer bills low, So we look for those 0:17:53.200 --> 0:17:56.359 opportunities where we can do multiple things with an investment, 0:17:56.720 --> 0:17:59.760 where we can replace an aging asset with something that's 0:17:59.800 --> 0:18:03.200 more modern and something that can carry more energy, something 0:18:03.280 --> 0:18:06.840 that can unlock more energy that our generators have to 0:18:06.920 --> 0:18:09.080 connect into the grid, and something that's going to be 0:18:09.119 --> 0:18:12.600 more resilient to storms and better leverage technology so it's 0:18:12.680 --> 0:18:13.479 cheaper to maintain. 0:18:14.280 --> 0:18:16.720 How do you balance all of that, Like affordability, as 0:18:16.760 --> 0:18:19.280 you know, has become quite the word that we are 0:18:19.280 --> 0:18:21.439 hearing a lot, certainly in the political environment. So how 0:18:21.440 --> 0:18:24.280 do you keep your investors happy and the grid reliable 0:18:24.359 --> 0:18:27.520 without rising bills that make your customers furious and invite 0:18:27.600 --> 0:18:30.720 regulatory and political pushback. I mean, that is a hard mandate. 0:18:31.160 --> 0:18:33.520 It is a difficult balance, and it's one that we 0:18:33.640 --> 0:18:36.760 navigate every single day. We do it through a number 0:18:36.960 --> 0:18:40.600 of avenues. We certainly work closely with our customers to 0:18:41.240 --> 0:18:43.320 help them manage costs, and we do that through a 0:18:43.400 --> 0:18:48.520 variety of bill assistance programs and energy efficiency programs and 0:18:48.560 --> 0:18:51.960 rebates and we work. We have consumer advocates whose job 0:18:52.000 --> 0:18:54.600 it is to specifically work with folks and communities to 0:18:54.680 --> 0:18:57.800 help them manage their costs. We also, as I mentioned before, 0:18:57.640 --> 0:19:00.919 a very careful about where and how we invest in assets, 0:19:00.920 --> 0:19:03.040 and we make sure that if we're investing in an asset, 0:19:03.240 --> 0:19:05.359 that we're going to get more power from investing in 0:19:05.359 --> 0:19:07.320 that asset, that we're going to get more resiliency, and 0:19:07.320 --> 0:19:09.840 then we're going to get more efficiency from investing in 0:19:09.880 --> 0:19:10.439 that asset. 0:19:10.680 --> 0:19:15.000 The President has been outspoken about his disdain for certain renewables, 0:19:15.119 --> 0:19:19.680 especially wind power. Your investment in renewables, are sourcing energy 0:19:19.720 --> 0:19:22.439 from renewables? Has that changed under this administration? 0:19:22.760 --> 0:19:25.560 Well, we certainly support the all of the above energy 0:19:25.600 --> 0:19:30.000 approach and are pleased with the most recent version of 0:19:30.040 --> 0:19:33.800 the State Energy Report that leans into an all of 0:19:33.840 --> 0:19:37.879 the above approach. Given the rate at which demand for 0:19:38.000 --> 0:19:41.199 energy is increasing, we need to we need to be 0:19:41.280 --> 0:19:45.000 utilizing all of those opportunities, from renewables to natural gas 0:19:45.040 --> 0:19:46.120 to nuclear to make sure. 0:19:46.520 --> 0:19:48.679 Is that more difficult if the federal government is not 0:19:48.680 --> 0:19:50.600 supportive of certain renewables. 0:19:51.280 --> 0:19:54.800