Heath Terry of Goldman Sachs Research explores clean energy and the advances in nuclear power technology as part of his team’s Venture Capital Horizon series.
This is an unofficial transcript meant for reference. Accuracy is not guaranteed.
This is a change of Goldman Sachs. I'm he turned Goldman Sachs research. Jake Keyword is often we welcome to another episode of art, venture capital for writing series where we use the land, the venture capital, to identify emerging technologies, business models and entrepreneurs and our first episode, we looked at the growth of a new field of medicine called computational biology. Indeed, at a time when we are reminded daily of the critical role science plays in solving the world's biggest problems, we are now going to dive into clean energy technology and how sustainable our energy, storage and deep urbanization can help shape our future Clean energy technology has been a priority for governments and some corporations for a while, but it had a tricky relationship to venture capital, as recently as two thousand and thirteen. We saw a nearly forty percent decline in DC funding into the
space following a number of high profile, venture back failures, but that's changing the European Commission. European Green deal aims to reduce the EU. Carbon emissions to zero by two thousand and fifty and buy our economist estimates could amount to seven trillion. Spending in Esg investing growth and sustainable assets increased by thirty four percent between two thousand and sixteen and two thousand and eighteen adventure is no exception. Thirty one billion dollars has gone into the category over the last three years in more than one Thirty percent increase over the prior three year period, the areas that has recently attracted growing interest and busy funding, is nuclear energy now course New energy has been around for quite some time, and its history has been a complicated one, on the one hand to truth, zero carbon energy solution, but it also goes without saying that concerns around reactor safety as well as reactor waved his slowed and, in some cases reversed
Adoption of the technology, that does it mean innovation and nuclear power, has stalled. If reactors to be made smaller, they could be far less costly to build safer, to operate and easier to locate. Julian places where other green technologies like solar and wind energy cannot efficiently provide power following some of the smartest venture. Investing in this space led us to Jacob De Witt and Caroline Corporate CO founders of oclock, an early advanced vision, company, developing small scale, new pillar powerful to what luck is through the technology behind applauds version of advanced vision, and how does it compared to the large cooling, tower dominated new killer, planned that most people probably envision when aid when they think about the future. So today's reactors he's water promotion. Poland, and also very very big rights, about twenty one gigawatt, that's a lot of power right and a system that, like
described or be large physically. What we ve done is gonna go about where we think going smaller in simplifying things is really one of the key factors here to realising think how much we have any Adam until we do that by building on a few form has been demonstrated, improvement for robust in basically decades of operational experience and reactors metallic fuels there. Have you done with conductive gritted, removing he? They are pretty easily made too good for verification costs and are also visited expanding under temperature and that's really important characteristics as it eats up. It expands electricians reactor down, and then you can buy not with effectively liquid metal cooling. Some answers, really get a moving heat and I opened up the door to have a system, that's pretty simple for small, not only it so close nuclear fission technology, potentially capable of supplying communities with affordable, clean energy. It's also capable of doing so, and it's stained
away by recycling feel one of the biggest concerns with nuclear power has always been the waste by products, but you actually recycle your fuel and convert that waste into into energy how'd. You achieve that and how applicable could that technology be to existing plants and their waste? The great question so there's been a decent, my time working through my life. So if you don't mind I'll get a little bit in the weeds no place here, we like to eat. So when you split and Adam provision one of the things you do is also release a couple. Neutrons, usually two to three and those then can continue on contained a chain reaction. When you do that, though, in their born those neutrons omitted from the written press, with quite a bit of energy, so the going really fast and enraged actors we slivers neutrons down by bouncing them off the Light Adams like lightweight items like hydrogen, There is one thing that is certain: it Rosanna makes it easier to catch in other absorb
that's useful because it helps us have less fuel. We need less fuel than to keep the reaction. Goings neutrons are easier to catch. but when they're going slow there easier to catch just like you, throw a very lasted pass into law. That's all! I need you to intercept the past, but slower neutrons also end up getting absorbed by things. Aren't you essentially interfere? With a reaction and limiting the amount of energy you could get an army after we're what's confess reactor We let those neutrons have run as their warnings fast. We do now or fuel to accommodate that is causing it. The very hard to catch, but that means that Domini things other than the fuel catch them. So we can run for quite a bit longer, For you end up through depleting viewing you're, not poisoner, how things are should we absorbing neutrons too slow to react to stop the reaction in the same A dozen sovereign transfer, some miracle, is because the new trans going fast, they carry energy with them and
that helps them actually cause vision and pretty much all of the actors rights which are feeling about the Pierre. table, the very lower rose that stick out tat have separate from everything else. The things that go to the right over from uranium things, I need to know The tunisian and recent tourism deserved the act tonight. and the reason those matters, those built up over time and reactor constraining, absorbs patrons and overtime transmute. And those are the things that actually dictate the long lifetimes for nuclear waste yeah you she'll today has one storage timelines, largely driven by those elements. Those isotopes ass new drugs. You can actually vision them, which is really elegant, way of breaking into shorter lived byproducts was extracting a lot of energy in the process. So it's really elegant way of basically managing kind of situation and reducing effectually them waste half lives in these five times, and so that's exactly what we do right were fast reactor
and because we have a capability than to actually tat ended energy reserves in these aconite that you couldn't otherwise do you're able to then reduce the half lives of the effect of by products at the end, watchword, energy. What that looks like is by visiting those things. Those byproducts are mature at mature half lives, they still waste eyes, lifetime right What we in discharging four reactor decision products, the byproducts vision, and there's still gonna have a half life any orders about, on average thirty years what better way insight than some other things you, you know breaking part to make them which have habits in terms in Europe. Hundreds of thousands of years the ability for reactor to recycle its own waste isn't unique. Oakwell between the nineteenth. Due to the ninety nine. These are reactor in Idaho was recycling its own Wakefield. What is unique, however, is ok. ability to reuse that exact material as a fuel source today, really working with environment, energies, materials they have from usual actually from that reactor that had just described and actually reusing
material, ass, your and our reactor actually doing that right. off the bat showing that this can be done the pre alien solution to its considered, one of the biggest problems is actually pretty big opportunity and put some numbers on it: These are taken based on. the? U S total amount of the EU, fuel and also of the by products of uranium enrichment airs. enough energy content and all those materials to provide for power for the United States four thousand years, Oliver parties for a thousand years Nuclear energy already provides around ten percent of the world's electricity and is the world's second largest source of low carbon power. It's ok, see allow curling popper and lead the company's regulatory process which has led to the Department of Energy. Approving oak was planned to bill there were micro, modular reactor at the Idaho National laboratories, one of the things that we ve heard from people on and utilities are potential
Consumers is like I'm interested in this, but is it like a ten year timeline digging through the regulatory process and how we? How does not look as far as burden for me where things and trying to really look guys with our application for this the first one? How can we ensure that the following Windsor is and was possible, we can use do as much encompassing analysis for the first one that will is the art encompass. What could happen that excellent different site or the sites references betray, do extreme analyses? First, seismic serve we're so citing one area have to redo advertising analysis for another Harry everybody, analyzer design against really bad. quick scenarios rate impassable buying violent. But then we can conceal, of this analysis, still holds for this next site. There are maybe some really really extreme sites. So we have judicial analysis to what our goal was to try to make it more
copy and paste and really interesting. Things is that the re later has a format for doing that. At the same time, success will depend on a number of additional technologies, reaching economic viability and rapid adoption. A key one of those is battery and grid storage. and no one knows that better than brightly had of clean energy for Goldman Sachs, global investment, research, wow Storing powers has as never really been a novel concept per se, because we seated indifferent industries over time, whether it be consumer, electronics or others. The idea of storing energy in large scale, for mad on the grid or behind the great, depending on the type of application one area where we were starting to see the technologies really mature, the cost per moving down and the complementary
sure of battery storage with existing renewable energy technologies like wind and solar and others. This makes it that much more compelling so well we in batteries from a technology standpoint the business model standpoint you mentioned that we ve been through a couple of cycles of this. This already. What's on the cutting edge of this point, cutting edge really depends on whether you looking at the commercialize area, the market which really is dominated by with you, my on technology and so from that vanish boy. The technologies quite mature across have come down dramatic. We ve had a lot of learning from consumer electronics and, more recently, electric vehicles adopting these batteries so apply. with your my and technology to the battery storage market on the grid. Hadn't been a step functionally phone It's been more leveraging the learning that be seen from somebody's other industries, but other battery technologies are being developed as well as ways to integrate them into power grids. Here's
again, so you don't you, you may have heard of technologies Flow batteries or solid state batteries sodium sulphur there's there's a multitude of different battery holidays that are fine to move from rd and lab, and pilot phase to commercial flight status. Someone's already started to break through, but not to the extent that lithium ion has, and so I think what you're going to start to see is you know new supply chain for somebody's battery technology, starting to really mature. You may start to see some. You know how to stream stream differentiation across business models. In terms of battery hardware makers versus the software makers, which make the batteries work more effectively and then killed. going batteries. Is it not trivial exercise in and of itself when it comes to putting this equipment onto the grid. And so when you dealing in a utility scales,
in the end, a greater than the system developers are also going to be a key part of how the ecosystem in business models evolve as we move forward in battery storage, I asked you a careless about where they see other exciting cleaning, knowledge is coming from beyond their out. At the day it is the need for powers only going to increase across the world fishing. You think about the fact that there is but a billion people they have access. We have to think about how we develop that out in a teenage that our technologies that are gonna be producing. You know controlled dispatchful power we needed and can gale and visions. Gonna have to be one in every literature and it will be- and I think it's a pre carries time in time to ensure that the hard take development going on. You know any other spaces in the energy sphere, because one is validates that these things can be successful. Then investments in technology development can work in these areas across a broad swathes of different approaches, and I just hope, strong capitalist system. Others get wanting on these things, the boy to market
Now we can do so is our here in the United States, and I think we here we can hear about like ok, the world is being the world need more power and largely that's going to fossil fuels. People forget here too the nucleus between sixty and seventy percent of clean energy in the United States alone. With a lot of the rest of being hydro, we really have to think about all the tools on deck. As far as how do we not just grow? population, growing, energy, use and sustainably. Think it's you know when we get outside the position taken in a very few party conferences. only world in You gonna seeing people from African India and different the nations and say you know it Don't just want some. We want more, great grids that can provide is per day and night, and we ve had in terms, for instance, from different african countries and really into what is without acquire. So you think
anything, but it's it's cool thing to think about how all these tools can views. Energy, Is there the expenditures on energy per year globally, six trillion dollars? So it's a huge market needs a lot of all of the above. I conclude with the latest episode of exchanges. Jake we'll be back next week. He should a change in at the end of this week for exchanges, market update for Goldman Sachs experts shared their perspective on the weak financial development. We hope you enjoy today's podcast and if you did, they subscribe and greatest one apple vodka I'll join you next with another episode of venture capital, the right and until then, I'm he fairy. Thanks for listening all price references and market forecasts correspond to the date of this recording. This podcast should not be copied distributed, published or reproduced in whole or in part. The information contained in this package does not constitute research or recommendation from any
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Transcript generated on 2021-07-02.