Decarbonization Trends with Nat Bullard

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This transcript is from a CSIS podcast published on March 4, 2024. Listen to the podcast here.

Nat Bullard: We need to do much more of everything that already works right now and we need to undertake challenges that we're only just beginning and scale them up accordingly.

Lisa Hyland: Welcome back to Energy 360, the podcast from the CSIS Energy Security and Climate Change Program. I'm your host, Lisa Hyland.

This week, Nat Bullard joins the show to discuss his annual take on progress in global decarbonization. Nat is a climate tech and decarbonization expert and he produces an annual slide deck, now reaching 200 pages, covers the key trends that are shaping our decarbonization future. My colleague Cy McGeady hosts this conversation.

Cy McGeady: Nat Bullard is a longtime analyst at the intersection of climate, technology and capital markets working at BNEF for many years. Most recently as the chief content officer, many folks will know him from his widely read Spark lines column for Bloomberg, which likewise ran for nearly a decade. Most recently, Nat was a partner at an early stage climate tech venture fund, Voyager Ventures, and most relevant to us and the subject of our conversation tonight. He's the creator of the now two years running annual decarbonization slide deck, and that remarkably seems to somehow have already become the cornerstone of the sector, though I believe that's only been for two years running. Nat, welcome to the podcast.

Nat Bullard: Thank you for having me. Great to join you and CSIS, and I look forward to this conversation.

Cy McGeady: We spoke roughly this time last year during our Energy Futures forum in the time since you've moved to Singapore. And so, before we jump into the actual substance and content of your presentation, I'm curious just the change in location from the U.S. to Singapore, what are the major differences that you've picked out in terms of perspective and attitude as it relates to just the basics of climate and decarbonization?

Nat Bullard: There are so many differences, so I'll try to sort of bucket a couple of them as a place to start. One is that we're in a part of the world really literally, right? Quite in the center of a region of the world in which energy demand is still growing more or less monotonically, where in consumption of all primary energy is growing equally. So oil and gas and coal, we're at a place where trade in particular in Singapore is incredibly important as a motivator for thinking about energy, not just resources, but the flows thereof around. We're at a place where climate impacts are very acute, given that I'm one degree north of latitude and a lot of the markets around here are not too many degrees north or south of that, we're also in a place where technology plays a major role. We are at the sort of headwaters in many ways of a lot of the supply chains that supply all of the things we need for deep decarbonization.

And we're also in all of these markets wherein applying levers to change will materially change what the future looks like for the rest of the world. Obviously, the world's biggest energy market north of China, it has an outsized influence on what happens everywhere else in the world. But so too, for that matter, does India, when we think about its trajectory, it's one of the biggest question marks in terms of major changes around the world. But so, for that matter, are the rest of the economies of Southeast Asia, both as suppliers of product, as export markets, as import markets, as energy growth markets, as emissions locations, as trade hubs. All of these things are very, very relevant to here. I find it very salutary. It forces me to question one of the priors that I would've had in life in North America, but also very exciting to see places engaging hard questions and hard problems early and often in thinking about what our climate's going to be like in the next coming decades.

Cy McGeady: Yeah, the geographical neighbors of Singapore, it just is such a denser region in terms of energy, in terms of people, resources, economies. I'm reminded of one of the really great images in your slide deck in which you break up the world into three buckets. You've got the U.S. and the EU, you've got China and India I believe, and the rest of the world. And it's three different stories. And Singapore is actually positioned right in the middle of two of those stories.

Nat Bullard: That's right. It's right in the heart of what's happening in India and China, which have related but different trajectories. The economies around it are a huge part of that rest of world, but its own trajectory maps as a highly developed place closer in some senses to the rest of the countries of the OECD, but at the same time it is not a resource rich and it is certainly a space constrained or delimited location. So you start to face a lot of very fascinating and important decisions around energy growth, demand, ways of supplying primary versus final energy here specifically and in the region in general that I think seem largely academic in a lot of other places.

Cy McGeady: Yeah, I mean we could go down the rabbit hole on understanding how Singapore thinks about this because it's just such a fascinating little microcosm of the larger whole. But let's step out and ask the big pictures about your project this year you put together this massive slide deck, 140 plus slides, I think roughly two years in a row, that really massive amount of breadth across the entire decarbonization problem, but also somehow you really try to capture the central questions. I guess I'm curious, year over year, what is the biggest surprise development you've seen in terms of the central dilemmas or questions that you've come across in putting together the state of decarbonization, if you will?

Nat Bullard: So, this year I went for the even 200 slides figuring that some of the mid-range 140 was both not enough and curiously, so I went for 200. Even I take a non-deterministic approach on this throughout the year, which is I'm essentially collecting and collating information as it intersects with the priors that I had, things that I had previously been collecting and B, where there's real novelty to be had. And then after basically an entire year of doing that, I've got a collection that I start to move around into a sort of set of master narratives. And I appreciate that question of yours because the biggest developments and the surprises in particular would shape that'd be a couple of them. One development that is not a surprise is anything relating to the cost of capital. How does the cost of capital impact what's happening around the world?

Something I didn't get into in great depth, but I think actually everybody listening will know about is the impact that this has had on sectors like offshore wind in the U.S. and to some extent in Europe, definitely the impact that it has in developing markets in terms of what the final cost of debt would be for an asset, how it impacts future expectations in terms of what risk-free investments are going to look like. Another would be the salience depending on the market of any kind of discussion of ESG or sustainability, writ large as they intersect with decarbonization. I definitely did not set out to have almost one slide out of every eight be something related to sustainability in capital markets and ESG, but it turns out that that was very relevant. A lot of that was disposing of us specific data sets and ideas that really dominate the discourse in the United States but are much less relevant elsewhere.

But others were related to data and information quality and towards corporate strategy elements that seem to have identified a lot of quick wins that have already happened, which now leave us tackling the much larger and much more complicated issues around deep decarbonization that we have to meet. And then a final one would be just making sure to update in as real time as possible the expectations for markets like somewhere in particular where we've just had a sort of complete no past of all of expectations in terms of how much got installed. The world did about 250 gigawatts of solar installed in 2022, which was obviously an all time record and last year did 440 gigawatts or so, needless to say another record, but a rate of growth that hasn't been seen in almost two decades, hence reaching the point where that's going to have material impact on future trajectories for emissions for growth in thermal power demand and should really set us up to question what it's going to look like in another few years when that figure has only doubled and then rise in another 30% to get us to the point where we're installing one terawatt a year of solar power around the world.

Cy McGeady: So those are three big stories. I mean, I'm not really sure where to pick up from there because those are all my questions. The solar question is really, I'm going to come back to the solar question because I think that is, especially for me, my background, the power sector. Fascinating. But let's start at the top talking about capital markets. And the first question, obviously interest rates. This is the year of elevated interest rates. I want to dive into that in more detail, but at a high level, you talk about capital markets with this stocks and flows theme, and interestingly that applies both to environmental metrics and also to how you think about the state of the capital markets. And I guess I'm curious how that theme ties those two together for you and how they stand in relation to another currently.

Nat Bullard: This was a fun formulation for me because I was trying to sort of capture a duality in the nature of these markets, which is that you've got all-time highs in both things. You've got all-time highs in anything that are related to atmospheric concentrations or consumption. And you've also got all-time highs in the leading indicators, so to speak, that are investment related in decarbonization. And the way to balance those is to sort of remind ourselves that our temperature, our glacial mass, our ocean heat content, our emissions levels, these are all the result of stocks, things that we have already done. Our atmospheric concentration of carbon dioxide is the result of centuries of activity. But the things that we can use to alter that are flows, flows of investment flows of physical capital, trade flows, flows of the intellectual property that will define the businesses and the business models of tomorrow.

And we have to remember that both things can be going up at once, but that in the long run, the flows-based side of things is the only real way that we can attack the stocks based side of the equations here. And this was a sort of an elaborated way of capturing this complexity. There's kind of no way around it. We can't, if we're going to have any kind of economic activity at all, expect today's stocks to just sort of vanish. They will do that on a geologic timeline. We'll probably end up back at whatever pre-industrial carbon dioxide concentration we've got. But within our gift as humans, we really can only at the moment lever up the flows based side of the equation, what we invest in, where we invest the deployment decisions that we make to change today and to tomorrow.

Cy McGeady: And so those deployment, especially every deployment decision is a function of almost, I guess all of them are a function of capital deployment. It's technology, it's physical plant, it's land, but it's the capital flows that sort of dictate the flows that eventually impact these stocks. And one of the ironies is that the first decade of, or the last decade that really saw the climate technology sector take off, that took place under zero interest rate landscape and it's sort of crowning peak moment when it felt like the climate sector finally achieved liftoff around 20 20, 20 21, the interest rate paradigm shifts. And so, the last two years, the world has adjusted to higher interest rates and I guess for 2024 so far interest rates are stable flat. They haven't started being brought down by the Federal Reserve, and obviously this is a domestic impact on capital flows and also global impact.

I'm curious just to take that one at a time, how are you seeing these higher interest rates shake out domestically? You mentioned offshore wind, we know about the train wreck of a year in some ways, some of the offshore wind projects I've had. But I'm curious on the tax equity market that I think is underappreciated as probably the single biggest driver of renewable deployment project deployment in the U.S. How is the tax marketing market being intersected by higher capital costs and what is the implication for the long-range deployment? Long range flows question as it relates to renewable energy.

Nat Bullard: So there's a couple of things we have to bear in mind together. The first is that, and I emphasize this throughout when I have conversations, is that there's obviously the cost of capital for assets and then there's how that intersects with the risk-free rate money does not exist in a vacuum. I as fiduciary so to speak, need to balance my desire to make an investment in an asset with whatever I could do with no friction and very, very little risk to earn a similar return. Or rather, if I'm doing asset investment, what additional premium do I need to make it worth the risk to do so? The tenured treasury is your sort of good analogy. If you think about it being worth almost nothing or less than 1%, well that's the rate that you're competing with plus a risk premium if you're in an asset world.

But if you're looking at a risk-free rate of 4% and then a secure overnight financing rate of 5%, everything will be higher than that and you need to start adjusting how your business is going to perform. Now there's a couple of things happening. The offshore wind example is particularly salient because there were a lot of agreements that had been struck in the expectation of a capital market with an almost zero risk-free rate that now has to adjust to a non-zero risk-free rate. This is almost like a duration mismatch if you will, and very unfortunate, but also very, very hard to avoid. The real question will be for other sectors that are moving more quickly is how can they absorb that risk-free rate and what are they competing with and where can they find points of leverage within their own structures, whether it's the financing itself or it's negotiating with providers, it's changing the terms of contract to find ways to get to market still pretty securely.

And I think we've seen a fair amount of nimbleness in terms of companies being able on their short dated assets to get into market today. It'll be really interesting to see if we stay at this elevated rate environment for a while, what that does if there's not some structural adjustment in expectations for companies, but also how companies might react to a declining rate environment again, and what that would do to sort of jumpstart the market. One thing that I think is super important in the U.S. is we do have these provisions within the inflation reduction act to make tax equity transferable. I don't want to get too deep into the weeds on this, but it does sort of open up new capital pools for companies and allow probably a larger catchment area for investible capital that can go into clean energy assets. And one thing that's really important, and you can see the data that's been published by some of the transferable tax equity providers, is that we're sort of starting to get some classic market structures that we would like to see.

The smaller the ticket size, the bigger the discount for buying that tax equity, the higher the return on investment, which makes sense because there's effort involved than arranging these smaller deals. They're riskier necessarily than the bigger ones. And the bigger, the more credit worthy deals have a very small discount to par value and they have a relatively low return on investment, which tends to mimic about the risk-free rate return on investment. So this is really healthy stuff, this is how you want to see markets behaving. But very briefly, I want to look at what this means for developing world markets for as well, and I've got some data here on both India and on South Africa. People in the United States are complaining about a cost of capital that might be, let's say 6% return on investment required for transferable tax equity for a $50 million plus tranche in the U.S.

But the corporate risk in India is almost in that range. It's 3.5% above the risk-free rate and the sovereign risk and the implied currency risk, the total cost of debt in India is 11%. In South Africa, the implied currency risk is 4%. The implied currency risk is almost the same as the return on investment for a big tax equity deal In the U.S. the sovereign risk is another almost 4%. The cost of debt in local currency in South Africa is 13%. That's very, very challenging cost of capital for an asset that is mostly financed with debt. I'll give you one last overlay on that. There's a great stylized chart that I've got from the regulatory assistance project that shows how cost of capital impact changes depending on leverage. So when I say in South Africa, it's about a 13% cost of debt, well at a 12% cost of debt in any market with a general hanging average structure, only 40% of the cost of capital goes to CapEx and OpEx and 60% of it goes to the cost of financing.

Cy McGeady: That number is wild.

Nat Bullard: So right, so if you're in South Africa, more than 60% of your financing activity is not financing the physical stuff or the operations of it, but is financing the money itself. So you can see why it matters. Now if you get down to a 2% cost of capital, 85% of your capital deployed is going to capital expenditure and operating expenditure and only 15% of it is going to financing.

Cy McGeady: It's hard to grasp that more half the project costs could go to just the paying back capital, the actual buying of the land and the buying of the physical panels, let's say in a solar project, costs less than half of the overall cost. That is wild. And there's sort of this ratcheting effect with renewables relative to fossil. So fossil the financing costs, even if the cost of capital is identical, let's say 12% or something, 13% because such a smaller portion of fossil assets are paid for, the overall costs are paid upfront and CapEx, the financing bit takes up a smaller part. And so the sort of less exposed to the cost of capital increases, which is a problem because all of a sudden if renewables projects were at par competitiveness with a fossil project in a given situation, cost of capital doubles. Well now that comparison looks far less favorable for the renewables relative to the fossil asset. Well, I'm curious, obviously there's other factors going on and you could measure out all the details, but I'm curious how you think the cost of capital question is impacting this renewables versus fossil comparison and if it's something that'd be worried about.

Nat Bullard: So as a general rule, it's going to preference you operating a high OpEx asset as much as possible relative to a high CapEx asset now at the same time doing this. So that basically means a couple of things. First, it means you should read thermal power for low CapEx, high OpEx because most of the expenditures go towards fuel. But at the same time, you do need yourself exposed to the variability in those costs and you need yourself exposed to the variability in whatever your cost of fuel is going to be. And I do want to say that for these assets that seem almost impaired by the current rate environment, it also means that they can look much more favorable as the rate environment moves in their favor moves down, and also that there may be refinancing capability that happens later on. It's not exactly the home equity market, but it's not dissimilar necessarily that favorable moves down in term rates can actually mean that there's a lot of financing activity to lock in new costs of capital when it's advantageous to do so.

Cy McGeady: Yes. I'm curious. Last year you had a slide that said something like the first trillion is the hardest and it really stuck with me, and this was I think measuring the total investment in clean power technologies and we'd finally sort of ticked over that trillion-dollar threshold. And so, it's like the first trillion is the hardest, the next trillion is going to come way easier. And so, as you mentioned, investment year over year is up. So, in a way that's clearly true, but I'm curious aside from the cost of capital side of things, which obviously in some ways makes investment harder, what are the new challenges that are emerging that are characterizing the next several trillion of investment that maybe wasn't a problem for the trillion dollars of investment?

Nat Bullard: The first trillion dollar run rate comes largely from the power sector and then electrified transport. It's pretty basically a combination of the two of those things wherein you're selling a product that roughly speaking can drop into the existing system. I can go in and substitute renewable electrons for fossil electrons, boom, I can substitute electric vehicles for internal combustion vehicles also. Boom, off you go. The challenge is that addressing all of these other sectors runs into some bigger challenges around fundamental science, around scale, around tackling industries that have not really been addressed deeply as of yet because they're hard to do into doing things in industrial sectors, heavier duty transportation, aviation, shipping, the manufacturer of steel, the production of cement, of aluminum, the production of copper, all of these things that have very established ways of doing their transformation processes for a very good reason. And so I think the issue is that we're going to have to be devoting a lot of money to sectors that haven't really been addressed yet and doing so in some cases in advance of them being in the money to the same degree that doing EVs with some subsidy or renewable power with no subsidy today is being deployed.

Cy McGeady: Something that comes to mind is your chart showing that CCS costs, this is a technology that has failed to take off, and I think your chart shows that the research indicates that costs may have actually not gone down, but up now there's a lot of variability there because it's not a mature technology where you can really pinpoint costs, but I think that sort is one of those that really is still so immature that there's going to be some capital deployed that is I guess maybe inefficient or subject to losses and inefficiencies.

Nat Bullard: No, this is a study from Oxford. I've used their work every year in various forms on various subjects, and yeah, they do an economic estimate of power plus carbon capture and storage over the last four decades. And yes, it really hasn't moved in favor at all. If anything, it declines slightly and remember these are estimates and then it has increased again, again on an estimated basis, but we haven't seen the kind of cost declines that you've seen in other more distributed technologies that you would hope for to bring these things to market. And it raises questions that are both very important for the market of CCS, but they're not in and of themselves market questions. This looks to me like policy decisions that will make this happen, financing support that is provided outside of what the market can do or a government commitment or mandate or requirements to be doing carbon capture and storage to a degree that hasn't been done yet. That is how you will bust out of this bounded range of rising costs estimates for CCS and get them towards something that is in merit in the system.

Cy McGeady: Yeah, that's fascinating that the model for achieving cost decline and sort of takeoff that has worked marvelously in solar or EVs or batteries, wind may not be appropriate for some of these others. Next technology, CCS, heavy industry decarbonization, this may require a different mindset, and in the U.S. at least, we just assume, oh, we'll just put a tax credit on it, it'll lift off the way the last industries did, and that just may not be the case.

Nat Bullard: We may have to develop new policy models, but we can look in a couple of sectors. Steel in particular is interesting wherein there are supply agreements in place for green steel that do match up production capability with inherent demand from customers that have also some durability to their demand, mostly in the auto sector. So there's 70 plus agreements for green steel supply globally, and about 40% of them are in the auto sector, auto or related. So they're automaker, they're a supplier to an auto company or they're in the commercial vehicle world. And that's really important because that's sort of showing a, there's a commitment that companies can get behind if they manufacture B, that there's an ability to absorb whatever delta there is between a green and a brown or a black steel price, so to speak, and C, that there's market capability to finance based on that. So you're starting to see big deals with lots of players. There is some government money involved, but there's a lot of long-term committed capital from the private sector as well to make these sort of things happen. But I did some very rough napkin math at some point last year, and if you wanted to decarbonize steel production in the same fashion that's happening right now with the consortia that are doing it, essentially scaling up their dollars to do what we need to do would cost about a trillion dollars or would require about a trillion dollars of investment, 5 billion at a time to do big chunks of this change. Again, not impossible necessarily, but a bigger deal and with bigger discreet quanta of deploy capital than simply building a whole bunch of 10 to 20 to even a hundred megawatt solar projects for instance.

Cy McGeady: Yeah. This gets into the question of corporate commitments and corporate action. One of the themes there, you mentioned how the changing state of ESG and corporate commitments have took off for a couple of years and they sort of have plateaued, right? They're still maybe increasing a little bit, but most large corporate entities now have some commitment. You mentioned the quick wins that a lot of companies have believed that they've achieved and now there's this need to pivot to the hard stuff. The steel sector seems like they're getting into the hard stuff. They're starting to figure out how to connect the dots. I put large quantities of capital at play to work. Is corporate ESG getting better despite the fact that you note that ESG outflows are sort of a fact of life in the U.S., is there a tension between sort of the label of ESG versus the facts of where corporations are, what they're actually achieving with their sustainability efforts?

Nat Bullard: I believe so in the sense that there's the rhetorical construct that is ESG, which is significantly under fire, and I think has been complex to navigate for many big investors and for many big companies. And then there's the reality of specific discreet decisions around changing the environmental impact of certain policies or products or business models that you have, which I think is continuing. But that's where you get to this sort of the quick wins element, is that a lot of those things were great. They were easy to announce, they were relatively easy to implement, and they could take place in a timeline that is appreciable and measurable by the market. But if you're going to get towards doing all of the difficult things, if you should say you're an industrial company, you need to worry about how you supply heat for instance, or you need to worry about chemical transformation and petrochemical processes, these are things that are not easy to do. They will take decades to implement and they will take a lot of money as well. So I feel like actually it's not a bad thing to have the focus move towards the harder stuff to do. My question is will they exist within a rhetorical construct of being viewed as an ESG activity, a decarbonization activity, a corporate competitiveness activity, a future-proofing activity for companies remains to be seen.

Cy McGeady: This question of corporate responsibility towards climate makes me think about AI and I have to ask you about AI because I'm an electric power sector guy. AI is driving huge load growth. It's changing the landscape and you present some really interesting metrics on how to think about AI and the energy use of AI. I think it's watts per search and you compare that with a traditional Google search. If I search nap Bullard on Google versus if I ask AI, who is Nat Bullard? The latter requires far more energy on net. How concerned are you about AI as it relates to climate? Is it going to unlock solutions that make the climate problem easier or is it just going to be a huge amount of new load that we have to deal with?

Nat Bullard: It absolutely is a huge amount of new load and for any of you listeners nearby SI in the DMV area, just drive out on the way to Dumbo and you will see what that mode growth looks like. It means gigawatts of new power demand in markets that haven't had growing power demand in years if not decades. It's a highly concentrated sort of load of a specific type to power a data center. The best analogy we can think of is to go back 70 or 80 years to making aluminum for instance with mass bulk power quantity that had previously just not been necessary or available. That said, in terms of the growth and power demand coming from AI and from sort of data in general, there's this massive sort of counterfactual wisdom that's very hard to get to, which is if you were running all that same capability at CSIS, for instance, on bare metal that you ran in your building, how much more energy would you be using to do the same?

I can tell you a lot. I can also tell you that it's probably been 15 years since you were doing that and you probably don't have a server room anymore though correct me if I'm wrong. Also, the capability within all of that compute is massively greater than it would've been even a couple of years ago. And yes or not of it goes to feed AI and what AI consumes, but what AI is used for I think is extremely interesting in these contexts. One is that Google, for instance, which obviously operates a bunch of its own data centers, uses AI to optimize the non-comp compute aspects of operations. So things around cooling, airflow, stuff like that. A lot of times coming up with sort of unintuitive outcomes, but that are materially additive in terms of how they can save power. Another are, we've seen this series of pilots that are academic, they're institutional, they're corporate around aviation, for instance, like free routing planes to avoid creating contra trails, which can have an avoided cost of CO2.

That's very, very low, and that also could not happen without really, really big data capability and the ability to crunch through it. And then the other thing is just to think that are these systems going to go away? Would we find massive energy savings by not having AI versus think about what we could do with it? I'm a bit skeptical of that and I'm more interested, I think intellectually in what you can do with all of these new capabilities in terms of not just what I mentioned before, optimizing systems we have right now, but developing new things. All of the different things that could happen in material science in the biological world that could be driven by AI that have a massive climate impact. We're very early innings in terms of what those are actually going to be, but I think it's more constructive to think about those elements first. Remember that there's a very challenging counterfactual AI versus not AI, and then there's also a sense of the creative capability of this beyond just the intake, the energy requirement capability that is again, hard to kind of predefine, but is worth thinking about constructively in terms of what we can get from applying these new technologies to big problems.

Cy McGeady: Yeah, the possibility of breakthroughs on some of these hard problems that remain beyond the power sector, beyond the transport sector is definitely enticing that. Final question for you. One subject, one problem that for the year to come and decarbonization, what's the problem that most needs our attention? So, both in terms of potential impact but also is right there ready to be solved or ready to have that breakthrough? Obviously, there's still some far out problems that really still need basic science. Obviously, we can't stop thinking about wind solar deployment, but where is that problem right in the middle there that really with a concerted push, we could really make some progress across the whole landscape?

Nat Bullard: Across the whole landscape? It's maintaining momentum. It is believing that what has happened before is a precursor to not an endpoint of progress and that we need to do much more of everything that already works right now, and we need to undertake challenges that we're only just beginning and scale them up accordingly. I think it can be constructive to view this almost in a working backwards fashion. Like we're looking back from the year 2050 or 2060 and we've gotten to net zero greenhouse gas emissions. How did we do it? We have some through lines already. Well, we need to do the triple double, I believe that is within the COP28 communique, so tripling renewable energy and degrade of energy efficiency. We just need to do more of all the stuff that works and we need to do a lot more of the things that are just beginning to work, but we also need to view them as both, not just essential but also possible.

And weirdly, there's an aspect within all of the top-down intergovernmental process that says that they're both essential, but says generally nothing about whether or not they're possible. And so, I think we have to sort of align the two of them and realize that if they are essential, then we need to make them possible. But remember too that a lot of stuff already is possible, and we just need to do it. There are a couple of supply chains, namely batteries and solar that are capable of putting us on a net zero path ringfence to their own capabilities already. We're very close to that. We'll be able to do that by the beginning of the next decade. How are we going to get everything else to look like that and how are we going to continue to scale these things beyond just their own net zero target, but towards impacting the trajectory of every other sector we can think of? How are we going to get green steel looking like it's on a net zero path? For instance? How are we going to get a heavy-duty marine transport or aviation looking like that? How are we going to maintain a sense of momentum and possibility? And that's hard to do. To some extent. It's a thought experiment, but I think it's also necessary to sort of assume possibility and work out the details rather than to assume impossibility and give up essentially.

Cy McGeady: Nat, it's been a pleasure talking. Thank you for joining us.

Nat Bullard: Thanks for having me.

Lisa Hyland: Thanks to Nat for joining us. There is a link the show notes to Nat’s annual slide deck.

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