Texas as a Nuclear Catalyst, Insights from the Houston Summit, and a $500M COP29 Commitment
The Week That Was: November 16-23, 2024
Spare Parts: What Caught My Eye This Week
Texas Catalyst for Nuclear | Reflections from the Texas Nuclear Summit
The Future of Energy | As discussed at the Houston Energy Summit 2024
Texas Catalyst for Nuclear | Reflections from the Texas Nuclear Summit
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Texas' potential to spark demand for new US nuclear construction and catalyze a renaissance in the industry.ย
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US Nuclear assets have struggled in spite of its attributes as the only large, low carbon, dispatchable, long duration generation technology that has been deployed at scale. What I heard and saw at this week's Texas Nuclear Summit (hosted by the Texas Nuclear Alliance) suggests we are close to "a catalyst moment" that could restart growth in the industry.ย
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โขย ย Big tech is driving change, signing agreements to restart facilities like Three Mile Island and investing in SMR technology. Yet, a wave of new nuclear construction remains on the horizon.
โขย ย Barriers such as financing, proper valuation of nuclear's environmental and reliability benefits, labor shortages, and cost uncertainties hinder progress.
โขย ย Texas is well-positioned for new nuclear development, fueled by acute load demand (led by data centers), the availability of natural gas as a bridge technology, and strong political interest in supporting the sector.
โขย ย The biggest challenge appears to be FOAK (โFirst of a kindโ) risk, or the "first in a long time", hurdle. Overcoming this with an effective mechanism could be the catalyst to reignite the industry.
The Future of Energy | As discussed at the Houston Energy Summit 2024
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The Future of Energy, as discussed at the Houston Energy Summit 2024, hosted by Salesforce and Deloitte Digital. Special thanks to Mike Bechtel for a great opening presentation.
The energy industry is at the center of AI, as a provider of the energy to feed this technology, and as rich environment to apply this technology. The industry's future of energy is bright!
A few ideas I left with from Mike's talk:
Embracing the Future: Act early in the face of exponential growth; recognize AI as "cognitive automation" and a tool for reducing mundane tasks ("less muck, more magic").
AI Potential & Challenges: Companies focus on cost efficiency (90%) over true innovation (1%); success depends on quality inputs ("garbage in = garbage squared") and strategic foundations like Shutterstock's GenAI model.
Innovation Perspective: Invention converts money to ideas, while innovation turns ideas into profit; prompt engineering bridges engineering and liberal arts for new, transformative applications.
My comments focused on three themes with the underlying message that โThe Future is Bright for Energyโ:
Growth: U.S. oil and gas supply remains critical to meeting rising global demand, while domestic power consumption shifts back to growth. Simultaneously, technologies like CCUS and hydrogen are emerging (navigating the "Hype Curve") as they gain momentum in reshaping the energy landscape.
Convergence: The convergence of big tech and energy is driving growth across the value chain, bridging the worlds of electrons and molecules. As new energy solutions gain traction alongside traditional energy systems, innovation and integration are reshaping the future of global energy markets.
Transformation: The energy sector is evolving with a focus on capital discipline, driving inventory-led M&A strategies as companies prioritize high-quality assets. This shift is accompanied by the unbundling of traditional value chains and the emergence of revenue-stacking opportunities, enabling innovative approaches to maximize returns in a competitive landscape.
$500 Million | Major Energy Companies COP29 Commitment
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TotalEnergies, bp, Equinor and Shell announced a $500 million joint investment commitment in support of the UN Sustainable Development Goal 7 (UN SDG7) during COP29.
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Sustainability is increasingly being approached as a shared industry challenge, prompting collaborative efforts to amplify impact. This joint $500 million investment consolidates individual sustainability initiatives, enabling companies to de-risk innovation, unlock new market opportunities, and strengthen their reputation while aligning with regulatory and ESG investor priorities.
By entrusting the commitment to a single "global private equity firm with a strong track record in impact investing," the collaboration not only attracts a diverse pool of top-tier managers but also enhances influence over investment decisions and reduces overall administrative costs, maximizing efficiency and impact.
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โขย ย UN Sustainable Development Goal 7 (UN SDG7) is one of the 17 Sustainable Development Goals adopted by the United Nations in 2015 as part of the 2030 Agenda for Sustainable Development. It focuses on ensuring access to affordable, reliable, sustainable, and modern energy for all.
โขย ย The commitment will fund projects aimed at improving energy access in sub-Saharan Africa, South Asia, and Southeast Asia and focus on solutions including solar home systems, mini/metro grids, clean cooking solutions, and enabling technologies (such as e-mobility, energy storage and management solutions).