Can We Connect the World’s Electricity Grids? with Simon Ludlam (Etchea Energy)

Today we're talking about interconnectors. Large electricity cables that connect different countries together and are increasingly an essential part of a modern energy system. But as global politics becomes more fragmented, how do we continue to build the international infrastructure that we need? Welcome to the Energy Revolution podcast. A fortnightly show where we discuss the most pressing issues shaping the energy transition with some of the brightest minds in the space. I'm your host, Salaman Ilyas Jarrett. I'm a former government advisor both at number 10 Downing Street and the UK Department for Energy Security and Net Zero. And I'm now a policy fellow at the University of Cambridge and continue to advise government and companies across the world on the energy transition. Today I'm joined by Simon Ludlam, a veteran of the interconnector space, founder and CEO of Etchia Energy. She's been involved in some of the most important interconnector projects linking Britain, Ireland and continental Europe. We'll talk about the practicalities of interconnectors, how Harry Potter almost derailed a multi-million pound interconnector project and whether a transatlantic electricity cable can ever become a reality. This episode is sponsored by Gowling WLG. The energy sector is transforming faster than ever before. If you're a business involved in clean energy infrastructure, you know this better than anyone. Whether it's renewables, batteries, networks or newer emerging technologies, it's really important that you've got the right legal advice in your corner. That's where the energy team at Gowling WLG come in. I know them well and trust me when I say they're real experts in the sector with deep industry expertise and a global network. They provide strategic legal advice to help businesses lead the transition and stay ahead in a rapidly changing market. So whatever your role in the energy revolution, Gowling WLG is ready to power your success. I've reminded to subscribe to the show if you enjoy the podcast and give us a high rating where it is that you get the podcasts. It's a free and easy way to support the work that we do so we always appreciate that. With that, on with the show. Thank you very much for joining us today Simon. I guess to start with, could you start by explaining to us the basics of what inter-connectors are and how they work? An inter-connector is relatively straightforward. It's a cable system that joins two networks, electricity networks together. Often two networks from maybe different countries but could be two different parts of the same country. They transfer large quantities of power, large volumes and they normally trade or the volumes move from one to the other when there's a price signal. So where one, where maybe the lower price market can sell into a higher price market. So very simply, quite often, France is very low because it's nuclear and therefore it will export that cheap power to the high price market which is the UK through cables under the channel. And how well connected is the kind of, particularly the European, I guess, how well connected is the UK with mainland Europe, how well connected are parts of the European grid as well? Yeah, so the continental Europe is very well interconnected and we have what we call a synchronous system. I, the sine wave is exactly the same in all the countries and therefore you can move around around in AC format rather than direct current format. Not unsurprisingly, as the UK drives on the left are actually transmission system and our electricity system actually runs at a slightly different phase. I, the sine wave isn't not perfectly matched with the sine wave of continental Europe. So we need to interconnect using HVDC or the direct current in order to do that. So the UK is a little bit of it is isolated in that respect, but the rest of Europe is actually very well connected. So you've got continental Europe and then you've got the Nordics, I bear is slightly different and then the UK itself. Interesting. And what are the main benefits of interconnection? Why bother laying these large under sea cables or I guess if you're continental Europe, overland cables between countries? Yes, I think there's a long story to it really. I think if you go back, you know, when we just had hydrocarbon generation, it made sense to locate power in places where you could produce a lot of power in a big coal, coal fire power station or a gas one. So you might locate that in a place that's quite close to maybe the sea or a river so that you can bring the fuel there, make the electricity and then you move it around. So you have very centralized generation that needs to move to people maybe in rural areas or to other countries. And if you've got a surplus, then it made sense to send it. So some interconnection was developed during that period, particularly in continental Europe and a little bit to the UK. But now we're definitely on a different move wherever going through the transition. So we've now chosen, the world has chosen to move to a green generation format. And that will mean that the production of electricity will both be intermittent and maybe it's even wind, maybe solar in the south Europe. And therefore when we have an excessive power in those generation areas, we need to move it to the people who need to consume it. And so interconnection has subsequently developed significantly. And that's also then been pushed. And I'm focusing on Europe here by the European Union who would like to see 15% of generation in a country represented by interconnection. Wow. That's a huge amount of interconnection. Yes. And it's been a target that's been around for, I don't know, maybe 10, 15 years. And each country is moving towards it. And to the extent they don't make it, there is a potential penalties to that. Now that's changed for a little bit for GB because we've pulled out of the European Union. Interesting. And yeah, I do when I talk about interconnection and renewable systems more generally, a lot of it does come down to geography and actually generation capacity is spread out much more across a large amount of space. I've often explained to people like the fossil fuels are greater storing energy over time in that effectively what you have is kind of multiple millions of years of energy stored in a relatively energy dense unit in, you know, whether it's oil or gas, whereas renewables, not as good storing energy in time. And therefore what you need is to kind of spread across as much energy across different geographies and space. And yeah, you know, obviously we've got lots of solar in the south. We've got potentially hydroelectric in places like Norway. We've got wind in the North Sea. And these all have different generation profiles. There will be times where it's sunny one place, times where it's windy another. And I guess the idea of interconnection is you're trying to shrink the geographic distance between the sources of energy and sources of demand. That's exactly right. The way we look at it is that when you produce an electron, you've kind of got three choices. You can consume it. You can store it or you can send it. And interconnection does ascend bit. So storage is obviously developing and we hope it develops further. Local consumption is, you know, you've got your local data centers. But the transmission piece is an important piece. And we work very hard on that through interconnectors. So one of the reasons we'll come on to it while we're in Ireland at the moment is that we see, for example, the west coast of France and Ireland gets the first four hours of the Atlantic depressions coming off the Atlantic. So that comes over. It hits all the wind and produces quite a surplus of electricity. And that wind won't get to the North Sea for another four hours. So if the west country, the west part of France and Ireland produce that first four hours of electricity, they can store it there. They could consume it. But they're both places where perhaps industry is not a big consumer of electricity. There's consumption, but not big. They can clearly save it and store it and they do. But you could also move it very quickly at the speed of light to the people who might need it immediately. And so if you take a briefly a triangle, say from London to Berlin and down to Paris, you've got a huge concentration, disproportionate concentration of consumption and people living in that triangle. So the idea is let's get it to them as quickly as possible. That's really interesting. So you're sometimes seeing even the same weather patterns, just moving across different parts of the geography at different times of the day. I think so. I think all of us wake up in the morning, pull back the curtains and we normally see the clouds generally moving in roughly the same way. Yeah. We do see different weather patterns. But there is a sort of repetitive nature to many wind patterns and it tends to be particularly in northwest Europe that the wind is coming from the west and moving across to the east or in an awfully silly direction. Interesting. And so what are, yes, you've talked about that kind of westily wind. Are there other key bits of resources that you see as being right for interconnection to kind of greater connect the source with demand? Yes, I think we do. So one of one thing that's perhaps not so well known is that interconnectors make quite a lot of money out of just simple time differences. So going east to west is quite an interesting concept. You can go north to south. So you can say, okay, let's take solar and Morocco and bring that to Europe. But you're roughly in the same time zone. If you're moving east to west, you start to track a little bit people's behaviour. So for example, we're now nearly midday. What we'll have today at the moment is that it's a beautiful sunny day. There's a little bit of wind and we'll probably have a massive surplus of power in Europe and prices, wholesale prices, are probably pretty close to zero and we'll be plus or minus one hour at the zenith. At the same time in another place like say the US, they're getting up for breakfast. It's their peak. And so there's a big arbitrage between places and time, particularly on an East West basis in which you create. a lot of arbitrage where you have a demand point versus a place where there's a huge surplus which we have in Europe. So we think about interconnection also on in terms of the passage of the Sun and also where you're going to have a lot of wind, perhaps not much demand. Solar is interesting and it's predictable and therefore I think having solar and batteries makes a lot of sense. Wind is more unpredictable and therefore I think transmission to get that wind when you have it quickly to somebody will be an important component. Very interesting and what's the scale of the benefits that we're talking about? Do you have a sense of, for example, this European interconnection target, how much benefit do we get versus a system which has much lower levels of interconnection? Yes, so interconnections aren't built by accident. There tends to be a huge amount of preparation and I hope you used a working government and would know all about that. So there tends to be a very large political element but in in Northwest Europe there is the Ensoy TYNDP, Ten-Year Network Development Plan and that tends to sort of collect projects, filter them and then decide which of those projects would make sense to take forward. And they're evaluated on social economic welfare that they bring to consumers in general. And so we can actually monetize and quantify the benefits that are brought. And so I can talk about a project that's close to my heart at the moment, Maris Connect and I do that because the numbers are under my fingertips but on that particular project it would bring, having the project put in place and it being operational will bring between one to 1.6 billion euros of benefit and social economic welfare to ours consumers over 25 years. So it's a huge benefit for relatively small amount of infrastructure. And that's connecting Ireland and Great Britain. That's right, so it goes from North Wales to the North Dublin area. And to me maybe a little bit about the landfall because I imagine once you get the power from Ireland to for example Wales in this case or from France to the UK or maybe from the UK going outwards as well. How do you then spread that across the rest of the energy system? How much do you think about the journey not just from country to country but once you reach the country and make landfall to the rest of the energy system? Like with any project you break it down into its component parts and you sort of plan it out right at the get-go. Obviously one of the key things is to be able to connect into the grid. Interconnectors operate at the highest voltage level in most countries. So we're operating at the United Kingdom. We're going to transfer the power that we've brought from our neighbours into 400 KVAC. So we're going to go into the high voltage system. So we need to identify a substation that can take that and that they're well documented and we can look at maps. So we think very hard about perhaps finding one that's close to the coast rather than one that might be in the middle of a particular country so that you can limit the amount of onshore cable that you need to put in the roads and it obviously pisses off everybody if you're digging up the roads or going across fields. So we focus on areas where we can get the cable very neatly from landfall, normally get into the roads and then wiggle our way to a close by substation. How much bespoke infrastructure do you need to build at the point of landfall? How big of these, because if you've got really high voltage, you then need to step that down to a voltage that the regular grid can take. These big landfall infrastructure projects, is it actually that you're able to minimise how much you build on land if you're able to be smart about where and how you're connecting? It's a good question. So maybe just talk about what does it actually look like? Most people are surprised about the small scale nature of an interconnector. So basically it's two cables, one positive, one negative. The core of it in copper would be about this big, 2,500 millimetre square, so no bigger than that. And then when you've got all the armoring and the insulation around, it's the size of a small pizza. And you have two of them. So they're relatively small and because they're what we call a direct current, they can be very close together. They don't not like AC where they have to have separation of the three phases. So they can be relatively close together and therefore the conduit for landfall can be normally done with a horizontal directional drill. So you're not going to have to go and you know, trench up the beach or anything like that. You can avoid that and you normally have a system where you can have a directional drill that goes right out to sea below high water means and then you can then connect with a cable that's been brought from from the other connecting country. Once we've done that, we then maybe just have a junction box and then we can go into the into the roads. And again, because it's HDDC, we probably use, you know, less than a third of the road to be close one lane while we cable the route out to the substation. Yeah, I think you're right. Most people that have never seen an interconnector. So I've never seen one, obviously kind of in situ in the sea. But likewise, I've seen some of the national grid of how to here is a cross section of one. And it is much smaller than you think. In my head, when I first got into energy, I imagined it was this huge like, be a month of a cable that was running under the ocean. But it's yeah, you could fit it in a backpack. You can fit it in that. You can fit in a backpack. Actually, we've we've fit them into huge carousels on big boats out at sea. And then we connect into what we call the converter station. So we're taking power AC off the grid. And so it's got that sinusoidal shape. And then we turn it into just a straight line. That's a very good way of transmitting high volumes at very low losses because sinusoidal is not very efficient way of doing it. I guess that goes back to history and the US decided on that. But DC could be sent relatively low losses and relatively straightforward. So we have a big valve tab where we take the AC, we make it into these into direct current. It then goes into the two cables. Everything's underground. That's from an environmental perspective is attractive. And then we have the replica converter station at the receiving end and then a small, normally a relatively small link of AC cable into the substation. And you're talking about landfall of interconnectors. There's a story which I just have to ask you about. So part of the backstory behind having you on the podcast, I mean, I'd already had you on my list and we met before when I was working in government. But somebody told me that Simon has possibly the best energy story that anybody has, which is about the challenges of making landfall for the interconnector. So I wonder if you could tell us about one of the unique challenges that you've had. Yeah. Each project has its own challenges and they're all challenging. But some of them can be actually almost sort of mythical. And on this particular case on Greenlink, which is another interconnector from Pembroke going across the Wexford, just north of Cork, we made landfall at freshwater west, which is a beautiful beach on the Pembroke Shacoast. And once we'd agreed with all the authorities, with all the landowners and the people who owned the beach, the local residents, how we'd make landfall, I remember BBC Wells said, could you come down and just do a quick thing? And so we stood on the beach and I explained that here's the sea, the cables all underground, it goes up through this HDD, up into the dunes, and then right at the top of the dune there, it then exits and then goes into the roads and off we go. And I sort of explained it in sort of great graphic detail. We did the shot, we finished, I went back to London and they then shared it, I guess a couple of weeks later and we got hundreds of calls, I mean hundreds of calls. And so my colleague Tom, who works in all the supermating, we're going to have to respond to these calls and I said, well, Tom, I'm super busy and he goes, no, no, we really have to respond to this. I said, well, Tom, what are they on about? And they said, well, look, apparently we're going to go straight through Dobby's grave. And I said, Dobby, who's Dobby? And they said, Dobby, I said, Dobby, I don't know, Dobby. And so Dobby in Harry Potter, you pointed out very clearly where his grave was and that the cable's going to go directly through it. And I said, well, he's a fictitious character in a fictitious book. The whole thing's fictitious. What are you talking about? No, he said it's very, very serious. And it was serious. It was serious. And so we got back with the planners and we discussed exactly how to re-root the cable. So we wouldn't go anywhere in a Dobby's grave. Actually, we weren't quite close to some real bronze age remains. But we avoided Dobby's grave. A lot of people were very happy about that. And the project's now going and Dobby's happy. Wow. So Harry Potter almost sunk a multi-million pound intercollector project. I think you've got to be flexible, agile and thoughtful. And sometimes, you know what, a 10-year-old girl, she's right. Yeah. And I do think they're actually, you know, it's kind of funny story, but I think there's a serious point behind it, which is, you know, these are huge infrastructure projects. Again, we've talked about how actually you're able to minimize the impact of them by doing certain things. But they are, you know, significant infrastructure projects in communities, often coastal communities that will want to know what the benefit is for them. They might have, kind of, reasonable reservations about the about the projects. And it's really important to be engaging with the community, listening to the community, managing public perceptions of clean energy projects. So yeah, obviously it's quite funny, quite surreal story. - It's serious for it, yeah. - But there's probably something underneath that, which is a good point to take away around listening to what people say. - Yeah, and the projects that always have first, or at least we've found, there's always something for the first time, and it's the first time we've moved for a fictitious character. The first, maybe not the last. - Maybe not the last, who knows? Who knows? - We do a lot more local history, (laughs) tracking of individuals now. - Yeah, if you have someone's job, who's basically the doby finder. - The doby finder, yeah. - It's a new role. - It's also the local law of taking to the place. - I guess, generally speaking about local challenges, getting planning, things like that, engaging with local government, are there other challenges that you find come up quite frequently within to connectors? - Yeah, so I think they're relatively complex projects, although I'm sure somebody will be listening who designs nuclear submarines. But the projects in themselves are quite complex because there's always two of everything, and you're going through to two jurisdictions and quite often you're going subsea. And once you go offshore, that's always very challenging. And from an oil and gas perspective, people will know that. So I find that coordinating two of everything and trying to get in lockstep quite challenging. And ultimately, our projects are always privately financed, so they tend to end with a financial close, where debt and equity agrees to come together to go to the construction phase. So I find that quite challenging to bring that ultimately all together. It's impossible to get both sides in lockstep all the way through. There's different layers of complexity as well, not complexity, but things to do. So there's obviously the technical side of it, and we can have technical people help us with that. And I would say the technology is getting mature now. Obviously there's continual improvements, but the basic concept of ACDC is relatively well established now, and the production of the cable and the installation as well, though. The regulatory models tend to change, and this is very challenging. You may have a situation, for example, in France, when we did a light link, the UK had a quite established regulatory model, but in France, it's different. There's only one company that can own 400 KV infrastructure, and it's called RTE. So you've got a very different challenge here. How can we put an interconnector in when the law says this and all the rest of it? Ultimately, we found that we had to go through a derogation method that we could be derogated from European law partially that would allow us to install the cable and run that. And that's now now working. And the challenges of going through the urite through a tunnel, they unique, and they had three fires and trying to think it all through, but insurers. So we have the regulatory side is quite challenging. An interconnector creates dependencies between two countries, and we shouldn't shy away from that. So if you can switch it on, you can switch it off. And you don't want somebody switching it off in a moment of stress, because they're big. They're as significant and they will wobble if you switch them off. So there has to be a huge amount of trust. And therefore, ultimately, I've found that no interconnector gets built without the handshake of the two premios of that country. So you've got to work to develop that coming together that ultimately they will shake hands. And the other thing I've found that's complex and challenging is that when somebody looks down the end of an interconnector, they will see some things that are the same. They may see blotter prices, or they may see flexibility. But they may see other things that's unique to that country. That in some ways doesn't matter. Providing we can get them together to agree that, given what is common and what is different, is enough for them to shake hands and get it built. So we spend quite a lot of time thinking these more softer political issues through. And I do think that the question of interconnection, as you say, is very connected with the question of politics and how globalized, regionalized, or sometimes just nationalized, the level of political engagement is there's something that's wonderful and beautiful about interconnectors as things that literally and physically connect different parts of a continent or multiple continents even. I'm thinking, for example, of when the the Baltics basically decided to resynchronize their grid with the EU grid, as opposed to the Russian grid, sound like a very, very, very small change. But actually, it marks this huge turning in geopolitics of these states being more aligned with Russia and the USSR to be more aligned with the EU. And similarly, that kind of level of interconnection, as you say, it creates this dependency, it requires cooperation. I do sometimes worry on the other hand that as we are seeing more retreat from globalization that things like interconnectors might suffer. A really good example, actually, was relatively recently, maybe a year or two ago, when Norway decided that they were going to stimme interconnector exports because they felt that actually prices are low in our country at the moment. If we export, that means prices will rise here in order to reduce prices in the market, which we're exporting to. So the effect of we decided to kind of hinder exports through the interconnector. And I worry about the precedent that things like that set and how do you think we are able to build the consensus and the cooperation to recognize that, yes, there will be times where it's in your individual interest to not be interconnected to another grid. But on net, the more interconnection we have, the better it is for everyone. It's an extremely important question. Maybe just taking one small anecdote around the one you mentioned with Norway, so they've stymied some exports into continental Europe. But we built one between the UK and NSL, between the UK and Norway. And the presumption was actually that the majority of power would go from Norway into a great Britain because of the huge hydro that's unmonetized into the UK system, which is a relatively high-price market. That does happen. But what was unexpected is all the reverse flow that we now see at night, where Norway then actually buys the power back at a very low price and pumps the water back up the hill. Is that because we've got so much wind? Because we've got wind at night and we've got a little demand. So this was unpredictable. And obviously makes a lot of sense. So perhaps the fears that everybody had didn't actually materialize. And I think it also comes back to, we're in a transition here. And so a lot of the concerns that people had, I think, are based on historic structures, historic generation patterns. And that's changing very quickly, where it's far more intermittent. And the energy's moving on connectors backwards and forwards with greater frequency than we had previously thought. So people are beginning to see that actually interconnectors can help at moments of stress. And the classic one was the beast from the east when we actually saw IFA flip on a heartbeat and go and export back to France to help France unthinkable. But it happened. And it increases trust that we can do this. If we go through the route-- and obviously I'm talking something that not everybody will believe-- but if we go through the root of being self-sufficient in every country, we can do that. It will be unbelievably expensive. And it will be unbelievably polluting and difficult for people to deal with, particularly on a small line and like the United Kingdom. I completely agree with that. The idea of autarky that you can be economically independent. In theory, maybe you can, but it's such an additional cost. And it's the same. It's really mirroring what we're seeing with some of the global trade wars that countries are deciding actually we want to be less involved in the globalized trade system. And you can do that. But it comes at a cost. Tariffs do not make your economy better off, generally speaking. Exactly. The failure in Iberia almost a year ago now was shocking. But actually, after doing all of the research, all of the evidence, the conclusion they've come to, Iberia needs more interconnection. They're very low in terms of their rates of interaction. So the view is not less interconnection, not more isolation. But actually, they need to be more interconnected to improve the integrity of the system. So I think there are obviously arguments for and against. But we see interconnection having a role to play. And the benefits that it brings are clearly quantified. Yeah. And I'm curious you'll take on this, actually. Because I have a suspicion that one of the reasons-- there are many, many reasons-- that we have high built in the UK. One of them is that we are less interconnected than some of our European neighbors, particularly comparable countries like Germany or France. And it does mean that we're more of a quite captive market. And there is less-- there are fewer places for that upward price pressure to flow. If you have a natural market price, go up. You get more supply. Interconnectors are a great way to basically just really open up the amount of supply or the potential supply that you might have feeding that demand. Am I onto something there? Am I completely wrong? No, I think you're right. England's got a history of trading. That's what we're good at. But if you look at the direction we're taking at the moment, is we are going to cover the North Sea with a lot of offshore wind. And we're going to cover a lot of our fields of solar. That's something that's a clear policy and is going forward. And the building out of offshore wind is something that's supported by all the nation states around the North seas. They've had two big summits. They're going for a 300 gigawatts of power in there. That will be the powerhouse of Europe. But as a result, when the wind is blowing, we're likely to have quite a lot of power. access. We'll store some of it and there's a long good policies about long-duration storage which we're seeing being put in place but the access will have to go somewhere otherwise it's wasted and it's inefficient. Let's send it to people who need it and they'll pay for it. And I think it comes to our natural trading nation state and that we're good at that. We have got 10 gigawatts of power of interconnection capacity with our neighbours. We had targeted 18. Let's hope we get to that. We think that will be good. However, falling out of the internal energy market following Brexit has not made the development of further interconnection with our neighbours any easier. It's probably more challenging. Yeah, bit so-bring. As you know with many things around Brexit, it's just made our ability to do what we do well as a country which is to be a trading-opened service-based economy much more difficult. Yeah, I think going back to Europe and into the internal energy market is a natural lever. It's a natural stepping stone to get as part of the reset to get closer to Europe. Yeah, because it's not a single market. Yeah, yeah. So it's a tangible thing that we can say, "Well yes, we can do that." And I think as Europe looks at us, they do see us decarbonising quite quickly. So they could see the benefit from their own transition of importing surplus green power from our wind into Europe. So hopefully that is not a Trojan horse, but it's certainly a vehicle that we can get onto. Bring us closer together with Europe. I'll take those sort of first few steps of maybe integrating it at an energy basis. And I know you've worked on it previously looking at OPs' ads and the rest of it. Wonderful. This seems like a good opportunity. Quick break. And then I've got much more to ask you when we come back. Thank you. As the energy transition accelerates, mergers and acquisitions have become a defining feature of the market, driven by net zero targets, investor demand for clean energy, and the growing strategic importance of battery and grid assets. Gowling WLG is genuinely at the forefront of this activity. I actually had Gareth Baker, one of the partners at Gowling WLG, onto the show to discuss it. And so if there's any doubt, you can go back and listen to that episode. But they've advised on some of the most significant transactions in the sector, including the 210 million pound acquisition of Harmony Energy in contrast by four sites, the recommended take private of downing renewables and infrastructure trusts by Bagmal Energy, and Gresham House Energy Storage Fund's Minority Stake Sale and Upgrade at Glassenbury. Whether it's battery, grid or generation, Gowling WLG's expert legal team brings market insights and commercial clarity to every stage of the deal. So we've spoken quite a lot about Europe for the first half of the episode. Obviously Europe is not the only place that's seeing increased levels of interconnection. One that I'm hearing a lot of, for example, is Southeast Asia, and a China has done loads of HVDC, which is maybe not technically into connection, but is basically domestic interconnection. I wonder if you could talk to me a bit about how interconnection is developing in different regions. Are there any core differences as well as to what we're seeing there, as what we're seeing in Europe? Yes. So maybe breaking interconnectors into sort of two parts, whether it's just pure transmission or whether it's a trading asset. As we look at Europe, say we take Germany where they have this north-south constraint, they need to get the power from the north down to the south to the economic powerhouse, and their interconnectors are really serving more of a transmission basis. So they've got plenty of power. It's an internal transmission. We see that in other places as well. I think one market that everybody thought would develop quickly was the US, and that we would have bootstraps along the east coast of the US taking power from areas where there was a good production of electricity and a huge concentration of demand, particularly on the east coast. For various reasons that hasn't actually developed. I think it's probably on pause and we'll come back. Asia is a very interesting market. There are some similarities that there's some very large economic centres, whether it's a huge amount of demand, and you could expect to see some transfer of power. So particularly in Southeast Asia, Singapore is one particular administration that's out here in Europe trying to understand as much as they possibly can about how we deal with interconnection, who we interconnect with, and how it's all done. So I think they're talking about the Asian grid. What's interesting about it as a developer of interconnectors is there's some very interesting things. It's not that deep, so it's not dissimilar to the North Sea. So we've got all the technology in Europe to deploy into Southeast Asia. So if we're talking about, you know, from Singapore up to Thailand or across to Indonesia or even ultimately to the Philippines, this is something that I think we have the technology in Europe to help them do. Some areas in Southeast Asia have perhaps sources of very cheap power. So Indonesia has a great supply of hydro. And to a certain extent, it would be that hydro going to Singapore. Singapore hasn't got much generation to send back. So it would be more of a sort of a generation swap. But, you know, potentially between Singapore and Thailand, it might be a two-way thing. Looking at China, it's more just about transmission. So you've got a huge amount of generation in the West, and they have, they're leading the way here. They've got overhead cables operating at more than a million volts, taking it to the East Coast where all the demand is. So we look very carefully from a technological perspective just to see what they're doing, how they're doing. Now it's overhead, so it's not the same as under the sea. But they're really pushing the boundaries to move huge quantities of power as their economy develops, particularly on the East Coast. Wow. And yeah, for people's context, million volts is a lot. I think for here, HVDC is 400. So HVDC here tends to, yeah, it was 320, and now the new standard is 525. Okay, 525. It's half. Yeah, half of that. And, you know, basically the higher voltage is, the more you can transport with lower loss. So it's huge potential savings. Yes, you can either increase the amps or the volts. If you increase the amps, you have simply more losses because as I squared R, if you, that's where you just choose the volts and try and get that as high as possible. More volts, more insulation, more integrity issues. But we're mastering that. And there is an amazing amount of technology in Europe already. And the R&D that we're seeing, particularly with Prismium Nexins and NKT, investing hundreds of millions to develop their new products. We're very excited about that. Wow. And you talked about, as you said, as Singaporeans being over here and trying to learn what they can from Europe, have you been watching what have you learned from China, basically seeing what they're doing? Obviously, they've rolled out a lot of HVDC overhead, so different from Sub-C, but it's very, very quickly, very high voltages. And it seems at a decent cost. How have they been able to do that? Yes, the manufacturing base is not the same as in Europe. And so they can do this in a cheaper way. They're more ambitious, perhaps, and their problems or their challenges tend to be much bigger. So you talk to South China grid. They actually, their customers are the equivalent of the entirety of Europe. So they can look at things in a much bigger scale and therefore bring much greater in terms of scale and scope. Their solutions could be much greater. So we watch them. I'm not sure Europe is embracing Chinese technology at the moment. And that's a choice. That may change. So I think all we can do is watch at the moment. We don't see them participate, particularly in European systems, but that may change. And I guess probably some of the things that we talked about being very challenging, which is the politics, doesn't really apply when it's all within your country. We're having to think about, relationships between England and France or Norway or France and Spain and one of the reasons that there's lower interconnection there is that there's been some kind of competing incentive sometimes between the kind of French and Spanish governments. If you're in China and you're working between different states, yeah, you have to deal with states interests, but no, in any other level that we have to hear in the EU. Yes, that's right. I think France is pretty well known. France decided that practicing monopolistic prices was a better way to make money than having interconnection with its neighbours. Now that's clearly changed over the last 20, 30 years and probably continue to do so. And as France's nuclear fleet ages and becomes more fragile, and they themselves will probably look to get security of supply in other countries. Interesting. And are there any other regions that you feel are kind of moving ahead with interconnection, you know, parts of the world to watch in this space? We have a very big project called NATO-L North Atlantic Transmission 1 link. I mentioned at the beginning of the pod, there is a lot of interest in following the Sun. So some people could argue that the Sun is our biggest nuclear reactor and our safest one. And capturing that energy is a very clever way of storing, you know, capturing the energy. And then it comes, you know, where we capture it and then moving it. So we look very carefully from an interconnector perspective. We like to see trading of electricity. We like to see flows. If it's a single transmission line from an economic perspective, that's tricky. But if you can have it flow two ways, that's good. So if you separate, I mentioned before, if you separate by five or six hours, you're separating times of when we eat in all intents and purposes. So here it's lunchtime in the US. It's breakfast time. And if I go further east, it's dinner time. And so if you have those sort of five hour six hour separations, which we have over the Atlantic, during the course of the day, you're going to have four different humps. And therefore you can assume the electricity will move backwards and forwards. Four different revenue sets. And you start to have an economic model that's robust and financial. So we'd look very carefully at these east-west models rather than north-south ones. Yeah. And obviously the Atlantic interconnector would be a huge undertaking, kind of unprecedented in the scale to have Europe directly connected with North America through the interconnection. What are the obvious challenges? If you're doing something of this scale, how much longer would it be than the current interconnector length that we've trialled? And what are the things that just keep you up at night when you're thinking about this kind of scale of a project? So why would we do this? And I'm sure a lot of listeners will be, say, well, this is stretching, you know, sanity here. I think the way we look at it is that we're all, and a lot of the listeners and you and I, we're all working on the transition. And the transition has some symbolic goals of sort of 2030, 35, where we hope to be decarbonized. And probably what that means, particularly in Europe, is that we'll have a meshed grid in the North Sea. And as part of that mesh grid, we will have hubs and little islands to facilitate that. But when the wind's not blowing in those hubs in those areas, everything's quite quiet and those assets are not being used at all. But they're beautifully set up to either import or export power. So what we're thinking is that let's not, we won't make landfall with NATO well. We'll just, and on the Canadian side and how the facts know the Scotiore and then down into the New Year England area, whilst it's a little bit unhauled at the moment, they have similar plans. They have similar models of shore meshed grids. So logically these cables will go across and connect into those grids so that they wouldn't come ashore. But they'll be just part of the next step, the next part of the transition. They'll be the next step where we connect the big basins of the world from a new perspective. We join those together. So it's not a stopping, it's a continuation. I broke all my teeth on putting gas into places where they had coal and heavy diesel oil, cities like Bogota and Bangkok and Minila, where you choked every time you went there. The first step was to take all that out and put gas into it. Now people have a pleasant life. The next step is renewables, but it doesn't stop. We will keep going. Then we join it all up so that we don't build too much and we use all the resources we've got in the best way. And of course, as you said, some of the distance of maybe skeptical, OK, this is a great idea. Usually ambitious. Is it pie in the sky thinking? I guess probably some of the main challenges would be around security. You kind of, if you've got this huge cable across the North Atlantic, what if Russia comes around with a pair of scissors and decides to do some cutting? And then I guess the politics, can you get the US Canada, potentially Ireland, if that's going to be what you're making landfall in Europe to interact with each other and engage and come to a shared agreement basically to maintain and build this really significant infrastructure project? What were your answers to those challenges be? Well, there are quite a few questions in there, but let's take the technical ones, which is the ones that most people come up with first. It's at the limit of what we can do today, but everything is going across there. We can do so the depths today, but we're already doing land cables at those depths. Maybe not long lengths, but we do have boats that can lay at the depths. We've spent some time looking at different routes to avoid the deepest trenches and the most difficult terrain or the steepest cliffs in the Atlantic. So we're beginning to work through how could we do that? But we won't be doing it tomorrow. This is a project maybe for 2040, and therefore we're beginning to think now and talk to the market. We'd like to do this. We need to have high voltage cable. Could you build it for us? Can you do the R&D now? So we're beginning to think of all those technical challenges, break them down methodically, one by one, the voltage level, installation, the boats and all that. And people are working with us because people are excited about it. Because from a technical perspective, that is the future. So I was going to ask, how high would the voltage need to be, do you think, on the technical side? So to have less than five or around 5% losses, it needs to be 800 KV. OK, so that's not given that we've just spoken about trying to do a million. This would be obviously under sea capals, but there are a couple of manufacturers out there that have got documentation out that they are moving to 800. They're spending the money and the time and the R&D to do that. So we're looking at technology that is there or will be very soon there to respond to that. Coming back to the political violence and war, what's the first thing I do when we do an interconnector? I go and sit with the insurers. That's the first thing we do. Go and talk to the insurers. There's no point in doing a project that can't be insured because you'll never get finance and it'll never get built. The insurers are clearly more wary and we talk more about political violence and war than we've ever done before. And everybody who has probably just seen the outcome of North Stream claimed by the insurers around whether it was war, whether it's political violence. But the biggest risks to interconnectors we've seen over history is just cable. It's an anchor strikes. It hasn't been Russian snipping at them. And across the Atlantic and across Europe, there are hundreds of fiber optic cables. And they're carrying extremely wealthy, not wealthy, but extremely valuable pieces of information that will be logical to cut up. Now, there's resilience because if you do cut one, it can go through another or it can go through a satellite. Cables are more, you know, there's less resilience because they're less often. But our plan is to have three sets, maybe have different routes. We will bury them as we do in North Europe anyway. We bury them up to 100 meters. We'll bury them. And they're after they probably get laid on the surface of the sea bed. So we tend to, there's already some mitigation around the anchor strike, but also people digging them up and blowing them up. Interesting. So that's 100 meters below the kind of sea bed floor? No. So after depths of 100 meters is quite deep. So we could bury up to about 100 meters. But there, when you get to sort of a thousand, two thousand, it's not practical to have a plow go down there and bury it. Interesting. And yet, I think the kind of fiber optic cables is a good counterpoint because you're right. When you've kind of first told me about the North Atlantic, I do. I thought it sounds fascinating. Like immediate concern with security. But as you say, we do already have North Atlantic cables. They're just not electricity cables. They are information cables. So yes, there is a risk that in wartime, these are the kinds of things that would be cut. But that is already true for kind of that information architecture. And you're right that to an extent, the information architecture, we've got more fiber optic. You don't have the same losses that you see for electricity. And so you can also go the longer if you need to and have multiple kind of fail saves built in. Yeah. Yeah, each transmission system, operator operates. It's grid that you can never have, you can't plug in more than what we would call the maximum single in-feed loss. So if you pull the plug, the whole grid falls over. Now, you they have protective measures that it's limited to a certain amount. So our idea at the moment is, you know, we're around about two gigawatts as being the single in-feed loss in most of the European countries. We'd have three times two and plug into three different islands. Yeah, when you put it like that, it doesn't sound as crazy. It's not crazy. It's just a matter of time. And there is a lot, there is what people, some people call sticker shock. Yeah. You know what, we take each sticker, we look at it, analyze it and think how to mitigate it. Now, maybe there are some elements that will never be able to ensure. And maybe there's some things that will be difficult. But just over time, we'll get there. Yeah. And I think there's something about the importance of big picture thinking, which it's very easy for us to lose. Again, you know, I'm a historian by training and been doing a lot of kind of reading recently about histories of technology transformations in the past. And the first telegram cable was laid across the Atlantic. I don't know where in the 19th century. Yeah, I think it was. I think it was. Yeah. That would have sounded completely insane. And you'd had no history of laying large cables across continents. And yet we did it, sort of 170 odd years ago. And yes, obviously a kind of transatlantic interconnector would be hugely ambitious on a scale of nothing that we've seen. There would be lots of risks. It's actually less of a jump than, say, laying the first fiber optic or first telegram cables. Because as you say, we've done a lot of the constituent parts before. So you know, I have my, as again, pharmaceuticals, I have my initial strong risk of version. Right. I start to think of all the things that could go wrong. But I do also think it's important to have that level of ambition and excitement about what can we do in the possible, what can we do possibly in the future? Exactly. If that cable existed today, it'd be making money, making a lot of money actually. So I think there's a simple economic model underpinning this. There's a real need for it. So let's just put it into action. It is challenging. But most things are. And we just got to work to it. I also think that ultimately when we look at, we could take each of the long line interconnector projects and we've you know, we've heard about excellence and sun cable and there's some rumors from India to North Africa, this NATO, well, there are others. Whilst you can, you know, you can critiquy, critique very easily each one of them and obviously, you know, we've been some winners and losers on here. But I think as an asset class, I think they will slowly emerge and there will be a successful one and once one is done, they'll be more. And so I think we should just keep pushing and trying because ultimately storing electricity is very expensive. And creating dependencies and creating and joining up with our allies, I think is a very good way to make it a better place to live with greater security amongst our friends. That sounds like an excellent place to end the podcast. Thank you. Thank you very much for coming in Simon and sharing some things about, you know, interconnectors, challenges and some of the really exciting things that we can hope for in the future. Thank you. Thank you for listening to the Energy Revolution podcast. If you've enjoyed today's episode, do subscribe for more episodes just like it every two weeks, where we'll continue to tackle some of the most fascinating questions in the world of energy. You can follow us on LinkedIn or Blue Sky for updates as the podcast progresses. And please do consider sharing it with someone else that you think would enjoy the show, a colleague, a friend, an energy zealot or someone that's just a bit energy curious. 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