Russ: Hi I’m Russ Capper and this is The EnergyMakers Show, coming to you today from Rice University, right in the middle of the d5 event. And I’m very pleased to have with me Sammy Haroon with The RBR Group. So for those watching that don’t know what d5 is help them understand it.
Sammy: That’s been a very good question that I’ve been asked again and again, so this is what I define d5 as Russ: It is oil and gas’ TED Talks, except with a little twist. In TED Talks the person walks off the stage and the audience is like they didn’t answer some of the things I wanted. So what we did is right after the talks, back to back couple of talks, we have the audience split up by their choice and they go to an auditorium where they get to do a bit more close up with the speaker in terms of Q&A.
Russ: Okay and the speakers are not necessarily in the oil and gas space, right?
Sammy: We try to bring them in from the outside. Most of the time they barely some of them may touch here and there, but we try to go very distant to extreme in their work as well.
Russ: Okay and kind of the mission being introducing the oil and gas space to some happening other technologies that might end up helping the oil and gas space.
Sammy: Russ as you know I’ve been in a number of sectors and I learned a little secret in how to cheat in a mention and that’s what we are trying to do here. In CPG industry, in the smart grid sector, in electronics every time I ran into a problem – which could be defined a little bit more generally – the invention or the problem has already been solved somewhere else. There is an analogy and that’s what we try to do is bring these folks here and allow people to connect the dots, but that was for the past 2 years only.
Russ: Okay because this year you connected the dots afterwards, or tried to.
Sammy: That’s correct, yes. So I have found that some of the folks find this very difficult because the boundaries are very broad here, so this year we had four C suite executives and we forced them to sit through the whole d5 and they took notes and they prepared themselves for a panel discussion of one hour which then produced a connect-the-dots from the experiential learning they had and how they absorbed what the speakers were saying.
Russ: Okay and that panel was led by Ram Shenoy.
Sammy: Ram Shenoy – Dr. Ram Shenoy of course.
Russ: He’s also a member of RBR too.
Sammy: That is correct; he’s the CTO of RBR as well.
Russ: Okay and we’re going to try to get him and a couple of other visitors but thank you for having us out here; it’s always a very interesting and exhilarating event to attend.
Sammy: Well Russ, thank you very much for making the time.
Russ: You bet. That wraps up my discussion with Sammy Haroon but we’ll be back with more participants in this year’s d5.
Russ: Okay, continuing on now at d5 I’m very pleased to have Vivek Wadhwa, professor and contributor to multiple publications across the country, mostly about technology and about the changing world that we live in; Vivek, welcome back.
Vivek: It’s good to be back my friend.
Russ: You bet. So last year at d5 you kicked off the conference addressing oil and gas head on. For those of you that don’t know d5 is a end of OTC – The Offshore Technology Conference – special addition focused on technologies outside oil and gas, but you kicked it off saying oil and gas is toast. And you were cautious because you know that Texas in now an open-carry state.
Vivek: I know, I was worried someone was going to shoot me but little did I know that I’d get invited back here this year.
Russ: There you go. You didn’t address that this year until the end of the speech, but you addressed it again, almost totally focused on solar. I thought last year was more solar and wind, this year was just solar.
Vivek: Because I see solar racing ahead of wind now because it’s going to be at the home level and the market will be propelled by people putting it on their roofs and having storage devices at home so they can be disconnected from the grid. I’m talking about the next 4 or 5 years, it’s not going to happen tomorrow but it’s eminent.
Russ: 4 or 5 years, so what will energy be like 4 or 5 years from now?
Vivek: For example I already live in the clean energy future; I live in a passive home which means it consumes very little energy, 3400 square feet, very high ceilings, I drive a Tesla Model S, and my energy bills for the entire year are about $500 which means practically free; that includes all driving, air conditioning, heating, you name it. And very likely I’m going to build another house which is completely off grid using the Tesla roof, the batteries and so on. So this is possible now; it’s practical now. It doesn’t cost more than the alternatives right now.
When the price drops another 20% – 30% the economics will shift completely so it will make a lot of sense for people to start switching over and to be getting off grid. And this is an exponential trend; it sort of builds on itself. So it doesn’t matter what government does, it doesn’t matter if there’s subsidies or not, the economics are about to change so that it makes sense for people to now be getting into this clean energy future and having solar everywhere; so wind at the grid level and solar at the home level.
Russ: Okay but isn’t it subsidized? Isn’t that part of the assistance in making it economical?
Vivek: It’s at a point that it just doesn’t need subsidy. Solar needed subsidy until about a year ago, now it’s become in many parts of America – probably most of America – it’s economical without subsidy.
Russ: Now you always talk about exponential progress and it’s kind of related to Moore’s Law of Technology and that whole thing and I remembered last year thinking about it, when you got to transportation and you talked about the incredible progress being made in batteries. But batteries really are chemistry aren’t they and chemistry doesn’t take leaps and bounds exponentially does it?
Vivek: But look at what’s happening with Tesla and the Gigafactory. When I was here last year I was making all sorts of projections about electric cars and people thought I was from a different planet. Well the electric cars are coming; most of the new cars you’re seeing coming out from the manufacturers are now electric. The Tesla is on track to release its Model 3 this year, $35,000.00 car and it’s going to make a profit on that. Elon Musk openly said that he expects $100 a kilowatt hour for his batteries in the next couple of years. We’re talking about $300.00 a kilowatt hour when I was here last year, now I’m talking about $100.00. All of this changed within a year so now what happens when it’s $50.00 a kilowatt hour – which is probably 5 years away; economics change.
Russ: Can it handle the demand though? When I hear people talk a lot of times about the future of demand a lot of it is based in India, a lot of it is in China, and there are many millions – hundreds of millions of people in those two countries that deserve to get out of energy poverty; don’t they actually need fossil fuels to do that?
Vivek: I mean we’re not going to stop using fossil fuels. What it takes to decimate an industry is to slow down growth. If the usage of fossil fuels went to 0 – I’m sorry, the rate of increase went to 0 and we saw 5% or 10% declines stock prices would drop, there would be a mad rush to pump all the oil you can pump while it’s still valuable and the entire industry would be in turmoil; this is what we’re looking at in the 2020s.
Russ: All right, so before I let you go, of all the categories you talk in – oil and gas, robotics, healthcare – which one do you think is the most revolutionary; the most promising and risky at the same time?
Vivek: Everything at the same time. By the way, I’m not picking on the oil and gas industry; I see it happening in every field. What I’m most excited about are the advances in medicine. I’m most excited about the fact that we’re going to have better decision-making; we’ll have AI tools being our friends, our companions. What I’m most excited about is that my car will start driving itself everywhere; it already drives itself on the highways on autopilot, but I want it to drive me everywhere. I see us being able to uplift humanity and share the prosperity we’re creating so that all of us do better. And rather than being obsessed with making money and putting each other down we’re now uplifting ourselves and shooting for the stars. That’s where I hope we can get to.
Russ: All right Vivek, I really appreciate it, thanks a lot.
Vivek: Thank you my friend.
Russ: That wraps up my discussion with Vivek Wadhwa.
Russ: Okay, now wrapping up our d5 show we have Ram Shenoy with the RBR Group, former CTO with ConocoPhillips, who actually also happened to be an advisory board member for the d5 organization and sort of wrapped up the event connecting the dots; Ram good to see you again.
Ram: Good to see you again Russ.
Russ: You bet. So tell us about this connecting the dots mission
Ram: So it’s really a result of the feedback from last year’s conference. So last year we had a number of speakers not from oil and gas and a few speakers from oil and gas and what was remarkable was everyone loved the speakers not from oil and gas but not really any of the speakers from oil and gas. And we thought well hang on, it’s not as if the oil and gas industry doesn’t have anything to say about innovation, but on the other hand we couldn’t ignore the feedback that we’d got that all these speakers from outside the industry were really getting great reviews and we thought but how do we make that relevant to an audience which is oil and gas?
And that’s where the notion, or the phrase, connect the dots came in, which is how does one draw sensible inferences from a statement like solar is going to take over the world, the oil and gas industry is toast? How do we give the audience some way of thinking through in a systematic way what might happen as opposed to just reacting to it? And so our idea was okay, we won’t have any oil and gas speakers but instead we’ll have some seasoned leaders from oil and gas who would come and listen to the talks like everybody else and at the end we would try and probe them on the themes and ask them to reflect on what resonated with them, what didn’t, what did they think we were already doing and what do we think we could take away?
Russ: And did that work?
Ram: So I think it’s a lot of work because we all had to pay extremely close attention to what each speaker was saying and then more critically draw inferences about what did it mean for the industry. Now the trouble is our speakers range the gamut. So we had one person talking about frankly the future of the world, right? We’re either in the Mad Max world or the Star Trek world and in each case the scenarios for energy, food, water, governments…
Ram: And medicine are dramatically different. We had another speaker who talked really about three things; one was geopolitical risk, the fact that the global financial crisis had led to this $100 trillion that had to be somehow unwound and forgiven. And then the fact that Nationalism was on its ascendant and he was drawing conclusions about interest rates and Nationalism that frankly it’s very hard to draw a line of sight to what the implications for oil and gas were. On the other hand we have other people saying AI is taking away your job which is much easier. And so our poor panelists had to span all that range to draw sensible conclusions about how the audience could take away and synthesize conclusions from d5.
Russ: All right, do you think they did it?
Ram: I think they did an admiral job; of course some things were straight forward. So Major General Cucolo, who has a wonderful turn of phrase but was very authentic in speaking about leadership and the traits of leadership – he’s of course a retired military officer and so sort of the ultimate in terms of leading organizations with clarity of purpose – and I think he resonated very strongly with all our panelists. They all had a lot to weigh in on elements of what they saw the industry emulated well, but there were also some fairly damning statements about what the industry didn’t do well. Mario Ruscev talked about firing half the population in his company and he said that’s a failure of leadership because we kind of knew that was going to happen but we weren’t very proactive in managing that.
Russ: Interesting, real interesting. So as the moderator was it a challenge for you too?
Ram: And so I think we generally succeeded in drawing some conclusions. For instance I think one of the things we tried to show some light on was if you really believe that the world is going to stop using hydrocarbons in 10 years you’ve still got to contend with the fact that today probably half the world’s population would simply starve pretty quickly just because the energy to move food the where it needs to be or to grow food isn’t there. And then the other half starves fairly soon afterwards just because replacements can’t be brought online.
If you think about the mechanics, the arithmetic of replacing one billion internal combustion engines in the world with however many electric vehicles, noting that most of the developing world – which is most of the world’s population – don’t have cars of any kind whatsoever – and you just do the arithmetic on the amount of lithium that needs to be mined you realize that there are – the digital technologies can be exponential but the physical raw materials may not be.
Russ: So in general how did you feel about if you had an optimism or pessimism meter in there?
Ram: So I think we ended up on an optimistic note which was even though our previous two speakers painted fairly dystopian – one speaker talked about a Mad Max world, the other talked about Nationalism on the rise and basically the world defaulting and interest rates being the world’s greatest global risk – I think our panel concluded that people are the most important thing in this endeavor and in the end we work it out.
Russ: That’s great.
Ram: Regardless of how whatever prognostications that can happen they’re almost always wrong.
Russ: That’s great, that’s good news for sure. All right, so before I let you go you’re also part of the RBR Group but you’re doing a lot of other things too; tell us what you’re up to these days.
Ram: I’m quite interested in space/space solar. So one of our speakers Vivek Wadhwa quite correctly pointed out that everyday enough sunlight falls on the earth that is many times more than what humanity needs.
And most people have been focused on land-based solar, but I’ve been quite intrigued by either solar panels on the moon and transmitted back by laser to the earth or simply an array of satellites – small satellites – collecting enough solar power that can be beamed by microwave laser. And I think it’s really all the technical pieces have been actually thought of and worked in the last 50 years or so, I think it’s really a question of economics. And if it’s off the order of $1 trillion or $2 trillion, well that’s off the order of what the oil and gas industry spent and if that’s the case now is the time to change; that would change the world.
Russ: Are you finding others working on this?
Ram: I am. So Houston Technology Center has a little startup working on elements of the solar panels for the moon base so it’s not like I’m a lone voice, I’m working with a couple of entrepreneurs. I think as private space travel becomes reality and the economics of raising payloads becomes more attractive rather than $100 million you’re talking about $100,000.00 per kilogram or something like that. I think we are at the cusp of a very disruptive change maybe in power generation. Now whether it’s in 5 years or 25 years I can’t tell you, but that’s what makes it so much fun.
Russ: Totally fascinating so I want to stay in touch with you on that and you update us every once in a while.
Ram: I’d love to.
Russ: You bet. And that wraps up my discussion with Ram Shenoy and this episode on d5 and this is The EnergyMakers Show.
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