Speaker 1Welcome to the PEXAPART podcast. Every two weeks, we'll be bringing you fresh updates and insights on the renewable energy market, along with a guest who'll share unique perspectives on the critical trends shaping
Speaker 2our industry. Welcome to a new episode of the PEXAPART podcast. Grid is scarce almost everywhere, and almost every market is absorbing more renewables at the same time. The obvious answer is more flexibility and squeezing more out of every site, co-locating generation, storage, and flexible load behind a single connection. But the way markets actually get there varies wildly, and it's not always that market design that does the work. Sometimes it's regulation, sometimes it's policy, and sometimes the outcome isn't what anyone intended. Joining me today is a guest who's been working on the PEXAPART podcast for a long time, and today is Jenna Boyle, Chief Commercial Officer at Gridcock. Gridcock models projects across a wide range of markets worldwide, which gives Jenna a vantage point most single market players don't have. We'll discuss how grid scarcity shows up across markets, how the co-location model has emerged as an answer, what is working and what not, and what markets should learn from each other. And as I do every two weeks in the second part, I'll take a look at some of the excellent reporting from the PEXAPART team. This time, we're diving into how long-term offtake is reshaping nuclear's next 20 years, and why the return of nuclear to corporate procurement conversations matters for anyone pricing PPAs, at least in Finland. Today, I'm very happy to have with me Jenna Boyle, Chief Commercial Officer at Gridcock, and we're going to discuss. An evergreen of the energy transition, scarcity of grid sites, and how markets are reacting to it. Jenna, welcome to the show.
Speaker 3Jenna Boyle: Great to be here, Luca. Looking forward to the chat today.
Speaker 2Luca Mazzucchelli: Yeah, Jenna, tell us first a bit about you and what Gridcock is up to.
Speaker 3Jenna Boyle: Yeah, sure. So I'm Jenna, I'm Gridcock's Chief Commercial Officer and head of EMEA. I've been with Gridcock three and a half years now. In Gridcock, we are a software business, what we've developed is simulation software for energy projects. So our clients, the people really investing in driving the energy transition, the developers, the IPPs, advisory businesses, and the large load clients who are investing in these assets. And they're using Gridcock to simulate all of the different physical and commercial options for their site. So typically that, you know, drives us towards co-location and even tri-location, right? Given my grid connection, what should I, what assets should I put behind that connection to maximize my revenues, to protect my energy? To protect my risks, and also what commercial model is most optimal for my site? So what we're doing behind the scenes is the full dispatch optimization. So simulating exactly how all of those assets would trade and perform across that project lifetime, to enable our clients to make those informed decisions about the investments they pursue. And what's really fun about that as a, I guess, personally, an energy markets person by background is we get to speak with so many different clients working in, you know, over 40 different energy markets globally. So really get to spot some interesting trends and sometimes different things, different markets can learn from one another, or that are particularly in one market or the other, which I personally find fascinating.
Speaker 2Yeah. And we discussed this in our preparations of 40 markets. Maybe we'll start with the first hypothesis. So we initially said markets everywhere we see grid sites are scarce, and this is due to more renewable being available. And so what we're seeing is that there's a shift in the number of energy markets that are
Speaker 3being absorbed in the market. That's true, like over the 40 markets you see. I mean, I'd say often in energy markets, we think about, you know, what's the most scarce resource? And it's usually not sun or wind or even fuel is increasingly scarce. But actually one of the most scarce resources we have is the grid connection as we, you know, progress on the energy transition and hopefully deploy, you know, trillions of dollars of capital into renewable and flex assets. What we're seeing is often the scarce resources. It's the grid connection. And so what we're seeing through our clients is saying, hey, how can we maximize those grid connections? And often the answer to that is co-location, tri-location, behind the meter development. Because, you know, as much as we can utilize those poles and wires that are connecting these assets to grid, the less that we have to sink into upgrading the grid. And hopefully then the faster we can progress on the transition.
Speaker 2Before we start going into details. Yeah. You mentioned co-location, tri-location, if you were to define those passwords.
Speaker 3Yeah. So at its most simple, co-location, more than two assets behind the same grid connection. Tri-location, more than three. In the, I guess in the utility scale world, if we went back, you know, 10 years ago, right? You talk about utility scale asset, that is one asset class behind the same grid connection. Whether that be standalone solar, standalone wind, a standalone battery, and that's how that, that whole part of the market has worked. There's been, you know, solar experts, there's been battery experts, there's been fuel power generation experts. But what we're seeing is saying, actually, hold on, the load factor of, of solar is, you know, in a sunny market, close to 15%, somewhere like GB, closer to 11 or 12. How can I add something else behind that same grid connection where that the battery storage is, is probably your most typical asset to then maximize the utilization of that grid connection? And once you've got then that battery. You're talking about that being a co-located project. Confusingly, sometimes they can be owned by entirely different people or different SPVs, but that's, you know, part of the joy and the complexity of the energy transition.
Speaker 2So co-location is typically solar plus battery and tri-location would be what, what else do you add into the mix typically?
Speaker 3Yeah, solar, battery, wind is what we're seeing a lot of in the utility scale. And, you know, GridCog does have a huge volume of our clients actually modeling on the behind the meter scale as well. And by default, those projects are often, you're almost immediately into that sort of tri-location plus space because you've got load, solar, battery, maybe a backup CHP, maybe some EV chargers and so on.
Speaker 2Yeah. And now basically the hypothesis is that what we're seeing is basically co-location as the universal answer to improve on the grid sides. Is this true as well? Just as a. A general statement?
Speaker 3I mean, universal answer is, is I think a bold term, but it certainly is, I'd say an answer without a doubt. And I think one of the answers that certainly myself and, and us at GridCog see is, you know, one of the most logical answers and, and answers that honestly stacks up and, and makes sense, both from a, a grid perspective and an investment perspective as well. I think that there's ultimately to, to solve the energy transition. Grid scarcity, there's lots of answers, but co-location and utilizing those connections and bringing, bringing flexibility into the energy system has to be one of the leading, leading answers for sure.
Speaker 2How do you see actually markets reacting to grid scarcity? So co-location is answer, as you mentioned. So what types of answers do you see?
Speaker 3Yeah, I think, I mean, ultimately grid scarcity and energy markets are. Supply and demand at their most purest sense. And so when there's scarcity of supply, we obviously see energy prices go high. And, and obviously when there's too much demand, you'll see the same. And verse when there's oversupply, you'll see those prices fall. And what we're, what we're seeing is that difference between your minimum maximum price and your day ahead markets or your spot markets, again, depending on where you're speaking in the globe, it's sometimes getting much wider. We're seeing increasing negative prices, particularly in Europe. That's been a big topic after the summer. And those negative prices are impacting the business case, you know, significantly for, for solar assets was falling capture rates and so on. So you see that on the market side, the supply and demand is actually creating a very clear signal to say, Hey, at, at some times that electricity or energy is, is worth a lot. And other times, Hey, please turn up demand or turn that supply off because it's not worth, worth anything. So I think energy markets point grid, you know, grid scarcity and supply and demand very clearly, but we also see it, you know, if we're talking about grid connection scarcity, I think a common thing we all hear about in the energy industry is connection queues that they are, it takes a very, very significant amount of time to connect new generation to the grid. And that's because that requires huge infrastructure build. It's not, not a simple thing at all to connect to the grid, especially at the scale that, that a lot of the industry is pushing. And so that, that also creates a signal and a signal to, I think what we're seeing is a lot of clients say, how can I then maximize what I've got?
Speaker 2These are very much a Marcus market fundamental approach to a fully agree. There's more demand for more grid sites. How'd you see markets reacting in terms of, I don't know, changing market design, the regulatory policy angle?
Speaker 3Yeah, I think there's a lot in the market design space and it's amazing how quickly energy markets have evolved. So if I speak. about you know GB as a market I guess I personally know well I've been active in the market for a while it's changed so much over the last 10 years like we've brought in a whole suite of ancillary services which have helped stabilize the grid that's also really you know built up the business case for battery storage there's obviously a lot of liquidity in different venues to trade power and wholesale energy markets there's capacity markets which we've had in GB for quite a while but for instance are now coming into the Spanish market so there's a lot happening on sort of that that market design side which is you know ultimately for flex assets and when we're talking about co-location we're invariably talking about a flex asset so let's say a battery storage asset that those new markets and new venues are creating price signals so a battery makes money by trading in a whole host of different markets and it's about that revenue stack that they're able to access which means that then that becomes an appealing business case and so markets like GB where there's there's a very deep stack with a whole load of different venues to trade power obviously is one of the reasons why GB's done well to have you know a high number of batteries and flex connectors to grid versus some of our counterparts in Europe and we're sort of seeing that that come through other markets for instance like Spain with their new capacity market really increasing that case so market design plays a huge role in in the business case for flex and also has played a huge role in the business case for renewables right like again all of these markets got renewables not only because hey the price was good for exporting solar but also for things for things reasons like the EEG in Germany from the ROX and the feed and tariffs and the CFDs and GB so there's a lot that actually breaks and markets play I guess into the broader story of renewables and then subsequently flex
Speaker 2how important is the market design and the regulatory approach if you compare markets by market like could it be generally said that this is just an accelerator because market fundamentals will anyway sold for it or how do you see the picture
Speaker 3yeah I think market fundamentals always exist but I think regs and market design can I think throw in a big blocker if they're not done right and can be a big accelerant if they they are done right so if we look at maybe we can speak about sort of four markets that I and Greg Cog know fairly well if we think about you know GB as I said we've done really well with having a very deep value staff there's been you know real incentives like FIT ROC CFDs for renewables capacity markets for batteries deep ancillary balancing markets wholesale is is it perfect no but but actually there's been some I think strong sort of tailwinds for for flex and and and renewables in GB if we look at Spain for instance they've got a lot of solar like 50 gigs of solar there is a lot of inherent flex in the Spanish energy system with pump hydro and CCGTs but they actually you know comparatively behind on battery storage if you compare them to other European neighbors and I think what we're starting to see in that market is they've realized that as have as have a lot of developers and IPPs who are you know very interested in the Spanish market and we're starting to see some of those regulatory barriers lift towards you know being more favorable towards batteries and then new markets come in like the capacity market then if we look at Germany for instance so Germany has historically had some really lucrative sort of subsidies or regimes for solar particularly the EEG what that's resulted in is so they have the same you know grid connection challenges as other parts of Europe what we're seeing Germany do is they have a background of I'd say a very liquid power market they have got ancillary services they're increasingly saturated but what we're seeing how that market's designing around okay but hold on how do we add assets and flex to the system what we're seeing in Germany is flexible connection agreements being I'd say one of the biggest and hottest topics in that market was which is actually the DSOs and TSOs saying hey sure you can connect to the grid but by the way you're under an FCA and that means you can only ramp up at let's say six percent of the cost per minute there might be some renewables curtailment there might be some wholesale freezes go on as well so that the network operator has a clearer view of how your asset will operating and can effectively provide some restrictions and get comfortable with the risk of new assets coming onto the system that is on the one hand sure because some more connections are going up accelerating it but on the other hand there's a lot of challenges for the market to understand well how material are these connection agreements and something I think is going to be a big part of a lot of grid cog clients are using us to try and figure out and sometimes they don't really make sense like if I've got a flexible connection agreement saying hey Jenna you can't export your battery because of a solar peak between let's say you know three to five all year like these windows there is no solar peak at 5 p.m in Germany and in November and so that there's also hold on how dynamic does this need to be is a challenge that I think we're seeing in that market well we're also seeing in Germany which is I think quite interesting and a bit different to other countries is the concept of a green battery which is saying hey I've got some solar on my site my solar has the eg and if I add a battery that can only charge off my solar so it can therefore only export to the grid one that can connect much more quickly two that can protect that the subsidy as well on the solar side which is on the one hand positive it's like yay great we're connecting more more flex to the grid and on the other hand it's like yeah we're connecting more flex to the grid the energy system needs more flexibility to keep the lights on to write a more renewable grid but also it feels like such a missed opportunity as well that's like yeah well in winter when the grid really needs this flex there's not much solar so there's not much generation you know that utilization of the battery isn't as strong as it could be so I'd say that's something we're seeing in the German market and then probably the only other market I mentioned here is Australia it's where grid cog was founded and I think something interesting in in the side is obviously there's a lot of solar it's a very sunny place but we're seeing a lot more happen in the demand side of the market in Australia versus I'd say other parts of Europe and particularly on the residential side so last year they introduced in Oz they call it the cheaper homes policy and what that's actually incentivized is a lot of residential storage almost I think over 11 gigawatt hours now of residential batteries in Germany which is very close to the same volume of utility scale and what that's actually starting to happen is that you do I think is really fascinating as a sort of markets person by background is actually changing the fundamental case for storage is that she's starting to compress some of the spreads and almost like arrest the duck curve that you see from the solar generation in the middle of the day because those residential batteries are competing for the same same market and same fundamentals so yeah lots of different examples I guess across those four markets but I think in all cases there are some policies and and I think that's what we're seeing in a lot of those markets so yeah lots of different examples I guess across those four markets but I think in all cases there are some policies and and you know I think there's a lot of opportunities to do that but I think in all cases there are some policies and and you know I think that there's a lot of opportunities to do that but I think there's a lot of opportunities to do that but I think there's a lot of opportunities to do that policies and and market designs that are accelerating things and others that are
Speaker 2inhibiting yeah I'm just my head is dizzying already just looking at the European cases they seem so different like the way those markets develop and and ultimately the the question this poses is this just like by design because the markets were so different and there's simply no harmonization on even just on on the European Union side or like where does this come from I mean just also from an investment point of view it's like if you have a multi market portfolio you need to deal with so many different designs yeah
Speaker 3and I think it's a it's a challenge I think it's easy maybe to think your specific market is is special right and I've been guilty of that knowing you know historically the New Zealand and the GB market in a ton of detail I think something that I enjoy and I think we get like find an overview of it at grid cog and I guess you probably get a similar view from pecks apart by operating in quite a few different markets you can actually say hey cool although we're trying to you know the physics are dealing with the same physics challenge market design is actually often similar we're trying to incentivize supply and demand to come on at the right time that different markets are pursuing different ways of of creating the same signals to drive I think the investment they want I think sometimes we call it different things like FCA in Germany so the flexible connection agreements you know that's such a topic in Germany we're actually starting to see a little bit of that happen in Spain that's been happening in Australia for over five years and in GB we call it active network management and it's it's broadly a similar concept as well so I think it's easy for markets to sort of inwardly design something and give it a unique name but actually if you step back often it is that there is a lot of I think more harmony than you realize we all just call it slightly different things
Speaker 2and do you see a similarity little regulations the way the markets develop like the problem arises from too much demand for grid connection then typically we see this like do you see somehow a similarity in how those flex markets evolve I think
Speaker 3yes at a high level right you see an increasing need for grid connection but that increasing need for grid connection is already started from more of a fundamental market fundamentals right I'm not just going to go and ask for grid connection in the market if I'm a developer or IPP that doesn't make any sense for me. So there's sort of the fundamentals that have evolved to get there. So I think that starts from, you know, what is the generation stack? What's the fundamentals? You know, are the price spreads there and so on? Then with more intermittent generation coming on, that creates sort of a fundamental case for grid stability, right? If we, again, round back a decade ago, there's much more spinning thermal plant on the grid, that creates a different challenge for the TSO or NISO or so on to manage with less spinning thermal plant, more intermittent renewables. Therefore, that creates a case for ancillary markets. Now you start to develop this revenue stack that starts to get interesting for battery storage. And if you don't, meanwhile, market fundamentals keep happening. Right? If you take Spain as a good example, solar capture rates in Spain has plummeted from, I think it was about 90% in 2022 in spring versus 40% in spring 26. They haven't added much battery storage in that time. But what's happened is there's been more and more solar added to the system. And that sort of created then another sort of fundamental case for co-location and flexibility. So I do think there is harmony in that space that obviously, as an industry, I think we often hear about it in terms of huge connection queues. But actually, we've got there, there's a path to get there.
Speaker 2What could markets learn from each other?
Speaker 3I think a lot. I think they can learn a lot, right? I think there's different things that different markets could learn from one another. And again, maybe if I just sort of pick out a couple of examples from the markets, we know well. Something I haven't mentioned, so far on the podcast is more that sort of behind-the-meter case. I think in GB, we've done an excellent job in recent years of making that behind-the-meter flexibility case make much more sense, courtesy of a code modification P415, if you fancy a long read. And that's actually meant that a lot of sort of industrial and commercial sites can add battery storage whilst also staying on their same supply contract. I think that's really interesting. That gives the grid a lot of flexibility. And access to that flexibility that otherwise, they wouldn't have. And that's what ultimately the grid level we need. So I think that's something interesting that we're starting to see more and more of sort of appear in other markets. But I'd say that's a real leader in terms of very much on the ultra co-location side that GB is leading on. I think also the power of the residential side is interesting. I think what we've seen in Australia with the residential flexibility, come online, we're not seeing to the same extent in Europe. I think we will. And I think that's the sort of interesting view into the future from the Oz market and how that can change. And then I think ultimately you look at GB, Germany, and Spain, and I think what all of those markets are learning from each other is the need for flexibility, the revenue stack that that needs to support, and also how ultimately, you know, a standalone renewable asset has. It has a much more challenging business case and a business case that's sort of much more sort of threatened by market fundamentals than one that's more protected by having a co-located flexible asset.
Speaker 2Jenna, let's assume you will be given the next job to become the benevolent regulatory dictator in Europe. How would your perfect playbook look like for the development of a flex market? What would you mandate?
Speaker 3Oh, big, big role. I think I would. Look at utilization of the grid connection. I think that's something that conceptually should be utilized much more. I think at the moment, you know, again, a standalone solar or a standalone wind is using the grid connection is, you know, the scarce resource in my mind. And they're, they're using that resource between 10 and 25% of the time. And I'd say, how can we use that remaining call? It's 75% and to me, it makes sense just fundamentally to add assets and almost sort of say, hey, you want to connect, you know, use that resource to, to its full potential. I think that's something that would be really cool to see, you know, sort of challenging. I think the industry is sort of throwing that challenge back on the industry and saying, how do you design projects to utilize that scarce resource more efficiently? But to do that, you need the economics of that to stack up. People aren't just going to build things because you ask them to, right? And so it's very much about making sure that that value stack is really deep, making sure that the option for people building these assets, you know, you guys will know that well at Pixar Park, people are financing these assets with debt and equity. They need contracted revenues, making sure there are markets and off takers and structures that can work for them to do that. But ultimately, I think using the scarce resource. I guess resource of the grid connection more efficiently is something I'd love to see.
Speaker 2So basically this being the main thing what we optimize for maximizing the utilization of the grid sites.
Speaker 3Yeah, I think utilizing those connections more efficiently and with the flex and assets that the grid needs.
Speaker 2And what I hear from you is like this market stack being very important. So price signals, establishment of. Traded venues, traded markets is important.
Speaker 3Yeah, I think really important, right? Like ultimately, that's how, you know, any renewable or any generating asset pays its way, right? And earns its keep is through contracted off take structures, whether they be PPAs, whether they be tolls or floors. But all of those are ultimately underwritten by the market, which is wholesale and ancillary capacity and so on. Or demand. And so ultimately, that price signal needs to be there from ideally as many of those venues as possible to make the business case really strong. But for somebody to go and invest, right, you're not, again, going to invest if there's not a price signal for you to do that. And I think that's what we see a lot of clients looking at. And I think as someone who's come from more of a markets background, I find quite interesting to see how those structures are developing, you know, moving from purely. If we looked again back 10 years, you look at battery off take contracts have moved from being sort of profit sharing merchant contracts to tolls, floors, swaps, and actually often a combination thereof where people can also participate in the merchant markets. So I think that that space is cool. And I think we need those price signals for assets to be, ultimately, you need them for assets to be developed. And that's what we're seeing, yes, certainly on the grid cog side. There's a lot of clients. Testing different options on that commercial off take side. You know, what does it mean if I'm fully merchant? How much am I giving away if I signed on to a toll or a floor? Or, you know, what might this hybrid PPA look like versus that one? And understanding what that means for the project, both in terms of how the assets are dispatched, but also, ultimately, how they pay back.
Speaker 2Now, as you're not able to have this dictator, just wondering, on your take, so you feel like a. Regulation, policy, market design is moving in the right direction, or do you see, like, still more on the negative side, some markets really not moving?
Speaker 3I think markets are moving, and I think they they're sort of being forced to move as well. I'd say I see more moving in terms of that sort of market design, market fundamental side, and that, in my view, is going to drive how assets are developed much more than sort of, let's say, a longer term roadmap of where the market is going to move. Markets will be in ten years' time. It's, I think, sort of more the nearer term things than market design, which is driving it. But I do think it is moving. I think it's easy sometimes to be caught in the weeds of, oh, gosh, it's sort of been great if we had this two years ago, or why don't we have this price signal sorted out? But I do think actually a lot is moving. I think sometimes we don't give ourselves credit for that as an industry, that it's shifting fast and also for people designing the markets. That's a big job to sort out as well, particularly if they're launching new services or new market design. So I do think it is moving. I think, you know, you look at places like Spain that hadn't moved that much until last year, and I think that market's really shifting. And, you know, that market saw and had a strong wake-up call for, you know, the need for flex. Obviously, it wasn't a lack of batteries purely that caused a blackout in Iberia. Obviously, it's very complicated voltage stability. But, you know, that being a signal to say, hey, hold on, flex in this market would make sense. Let's try and remove some of the barriers to that, add in price signals like capacity markets for people to do things. And I think something we probably haven't spoken about on this podcast so far is the topic of data centers. That's a never changing, that suddenly changed the game again, right? We've been building generation in a market that's had actually stagnation. And so we've been building generation in a market that's had actually stagnation. it as saying, hey, electrification of heating and electrification of transport, suddenly had this whole new asset class in the data center want to connect to the grid as soon as possible and adding really new challenges, new things where, again, regulation and market design will really have to play a role here. And I was chatting with my Spanish colleague earlier this morning, and he was talking about how in Spain, you know, what the current proposed regulation is, is that actually 80% of the energy going to data centers needs to be time matched on an hourly basis, doesn't have to be from the same site, but needs, you know, that's the proposal. And it's really interesting to see how quickly markets are starting to think, well, how do we bring this demand on, but not, you know, use that as an accelerant to the energy transition and make sure that there's sort of parity and fairness with other demanders. So I think that's an, it's an interesting space. It's an area we've seen a huge uptick of interest in as well. Like they have the same challenges like flexible connection agreements that I mentioned with the generators, same thing happening on the demand side as well. So, yeah, I think interesting that sort of demand is, you know, a lot of new demand is coming in through data centers. And actually, I think it's going to be an emerging challenge for us as an industry to say, okay, how do we make this make sense? And put the right design and policy around that as well.
Speaker 2Yeah. Huge topic, complex, developing fast. Jenna, thanks a lot for coming to the show and giving us an overview of what is happening across markets. Thanks.
Speaker 3Thank you for having me, Luther.
Speaker 2Good chat. Today, we covered the news of Google signing a 22-year, nuclear PPA with Fortum for Finland's Lovisa plant. Now, this could be read as just another story of those big hyperscaler buying big megawatt tickets. But if you step back and look at the wider data set, there is really an interesting story developing behind it. Across the US, France, and now Finland, Paxapark is tracking 14 gigawatts of existing nuclear capacity under new long-term contracts. More than three quarters of that has been signed. Since January 2025, and we see a common denominator. Every single contract in this data set is tied to CapEx in an existing asset. It is about a restart, an upgrade, or a lifetime extension of the underlying power plants. So, the buyers are not just contracting for future electricity, but they are really actually ensuring that the plant's life are extended. Why nuclear and why now? Well, in the US, it's very easy. For a US hyperscaler, it is simply about getting their hands on capacity, regardless of its source. Look at Amazon and Meta building both multi-gigawatt gas-powered sites. In that respect, Google and Microsoft are much more attuned to the carbon footprint of their procurement. It seems for them to be equally part of their commitment to source clean. And of course, all of them have the balance sheet and financial firepower to enter into such long-term contracts. Overall, when we look at the data set, hyperscalers account for roughly two-thirds of contractor capacity since 2025 for this 14 gigawatt. The rest is utilities, cooperatives, and government buyers. If you were to look for archetype of a deal in the US, look at the power plant in Clinton in Illinois. There we have actually Meta signing a 20-year deal with Constellation with COD in 2027. And that's exactly. At the date when the state's zero-emission credit program for that plant expires. Constellation itself calls it a market-based replacement for that subsidy, and it also funds a tiny upgrade, 30 megawatt. So the corporate buyer here is really stepping into a revenue support role the state used to play. Now, across the Atlantic, when the story changes a bit, and here it's mostly, or it's all about France, where we have so-called. CAPN contracts, these are nuclear production allocations across the fleet, and typically they cover much smaller slices. They run between 10 and 12 years, some longer, and the buyer is typically an industrial to secure existing load, not a hyperscaler creating new demand. We just noted here a very big deal recently with ArcelorMittal. Here we have an 18-year contract, but this was all about securing contracts. It's a very competitively priced power for their French steel production. And of course, the product is different. Buyers take a share of the actual fleet output with exposure to some availability and cost parameters. Now, if you were to look at the Lovisa deal, which covers nearly 10% of Finland's power capacity, now here we really are dealing with new demand. We have hyperscaler demand on one side, and then a European generator using the contract to fund the life of the fleet. On the other side, the deal surely will have repercussions on the market, which everyone will feel, well, because the contract capacity is so large. So some market participants are expecting quite a price impact on spot markets, especially in winter months. But overall, I believe this is a big win. First, it is a great deal for Google and for the Finnish economy. It is linked to a 12 billion euro data center. And finally, I believe it is great for clean energy expansion. Lovisa extends to 2050, and it gets some smaller upgrades. Now, man, if I were to dream, if we could bring back the German nuclear fleet in similar deals both for data center and local German industrial load, that would be fantastic. But I guess I'm dreaming a bit too big here. Thank you for
Speaker 1listening to the PEXAPARK podcast. If you're interested in more news, data, insights and analytics on the energy transition, head to our website, pexapark.com, to find out more.
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