Tucker Perkins, CEO of Propane Research & Education
Potentially the most contentious interview that we’ve down to date we explore the role propane and natural gas plays in the transition to clean, renewable energy.
As the CEO of the Propane Education & Research Council Tucker Perkins has decades of experience across the energy sector and helps to put natural gas into context across the energy needs of our modern world.
As we transition to renewable energy there is a segment of the energy mix where energy density is critical (think shipping and logistics) where solar, wind & storage battle to be viable so the critical question is what liquid fuels (that have the requisite energy density) and how are they created.
We explore the differences in what gas is burned which then impacts the level of either CO2 and other greenhouse gases such as methane released. Beyond how it’s used, how it is sourced is an even bigger lever. New approaches to liquid fuel creation, through the use of biofuels, provides the promise of CO2 free energy, that is accessible and affordable to bring the quality of life we are used to in the developed world in the developing world
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00:00
Hello and welcome to Shape the System.
00:04
where we find and tell the stories that help people to rethink the way the world works. We interview people from all over the world who are helping to change our systems for the better. Shape the System is an independent podcast with support from KPMG High Growth Ventures, who help ambitious founders and their teams scale up for success. More about KPMG High Growth Ventures after the interview. We hope you enjoy this episode.
00:33
Hi everyone. Welcome back to another episode of the show. In probably an unusual move for us, I think, and I want to get on the front foot with that, we're going to be talking about natural gas today. And we're going to be talking to Tucker Perkins over at Propane Research. They're a group. I'm going to let him more introduce it in a minute based over in the US. And I had to do more research for this episode than I've ever done in any other episode because I really wanted to understand a whole lot about this before I went into and even-
00:59
agreed to this interview, but I'm, I really am interested in, in, in talking about and deep diving in this. And so before we dive into natural gas and propane and a whole bunch of the stuff that we're going to be talking about today, Tucker, if you could just introduce yourself, talk a little bit about where you're from and we'll dive in from there. Thank you. Well, sure. All right. My name is Tucker Perkins. I'm the president and CEO of the Propane Education and Research Council, which is probably a one of a kind organization around the world chartered to
01:27
Really make sure their propane is used safely. The people who use it are well-trained that we know how to talk about its features and benefits to builders and to material handlers and to homeowners and farmers, and that we really innovate both in the fuel and the applications into systems that use it the best. That really ties all together. As we think about the environmental conversation that we should be having, it really gives us.
01:56
a firm grasp on how we're going to look in the next 20, then 30, and maybe 40 years. Okay. Wonderful. And I'm going to use the umbrella of natural gas and pull me up and correct me on terminology that I use if it's not the correct terminology. But I want to, like anyone understand at the moment, I guess the nature of natural gas today, like where does it sit in the energy mix? And give us some of the detail in there as well because
02:22
Not all gas is gas. It's all coming from a whole bunch of different places and it's a spectrum of things. And I think it's unfair to call it all natural gas. So maybe just help us understand that the nature of natural gas in our energy mix today and not just in the electricity generation, but how we move objects as well, obviously the broader applications. Yeah. I think so one, certainly all fossil fuels have been painted with the same broad brush that all fossil fuels are evil. And I'm quick to say that coal or oil or wood are pretty dirty.
02:51
And if you make electricity from coal or the wood, I might say it's even dirtier. Natural gas, as you've already alluded, is a big provider of natural gas generation. But natural gas, depending on where you are, has a little bit of a different context. Here in North America, particularly, we're dominant with natural gas or a natural gas distribution system. It's just everywhere. It's almost omnipresent, if you will. And so we not only have a lot of abundant natural gas,
03:20
We actually have a very strong distribution network. So it's not quite the same for Africa. It's certainly not the same for parts of Europe, but natural gas is relatively clean when it's used properly. Propane, just to continue on for a second, comes from generally natural gas. Propane is either one of the heavier things found when you're looking for natural gas, or it's one of the lighter things found when you're looking for crude oil. So.
03:50
to a degree, Russia, a lot of crude processing. They too will have a lot of propane, but here in the United States, almost all of our propane comes from cleaning up natural gas. And that's like unusually, so let's like dive into a little bit of the chemistry here. Cause I, this is part of what I had to dive into to appreciate the reality here of the differences in these gases. And let's do it in the context of energy mix as well. And we can focus on North America. I think that's fine. We'll assume that there's
04:20
that thing is being extracted already from whichever source. And we'll talk about those a bit later. What have we got here? We've got two types of primary gas. Like just talk us through some of the chemical composition here and the impact of the difference between them. Yeah. So the chemical formula for natural gas is one atom of carbon, four atoms of hydrogen, so CH4 almost always is a gas. It's generally found as a gas. It's transported as a gas, unless we'd super cool it to form LNG, which
04:48
The Europeans would immediately understand liquefied natural gas, but the normal way natural gas is found and transported is as a gas. It has all the features and benefits of being easily put in a pipe, but not very easily put in a truck or a ship. Right. And it contains methane, right? Methane is a pretty bad greenhouse gas. Unburned. CH4 is methane. That's right. Oddly enough, propane is C3H8. So. In the.
05:18
carbon chemistry chain, there's natural gas, then ethane, then propane, and then butane and some other heavier things. Eventually you get into gasoline and diesel fuels, but propane would really be the next carbon element past natural gas. But oddly enough, it contains no methane. So one of the things, even as we see today, modern refrigeration systems are moving.
05:47
from hydrofluorocarbons that were horrible for the environment to propane refrigerant systems around the world because unburned propane is nearly as innocuous, if you will, as CO2 when released into the atmosphere. Propane contains no methane. Other than that, propane is easily stored, transported as a liquid. So you and I will even talk in a bit later.
06:15
Even as we begin to think about a world that where hydrogen is the end goal, we're seeing and participating now places that take renewable energy, make hydrogen, mix it with carbon. And instead of doing things that you might think about, they actually make renewable propane. Right. Why? Because renewable propane is so easy to store, transport, and then use later. So
06:42
We really believe that will be something that's done routinely in the future is make renewable propane where we have abundant sun or wind or water for that matter, and then store it, transport it to where people need it. Yeah. And I want to get down to propane in a bit, because I think this is the massive misunderstanding I certainly had, but also a lot of other people may have in terms of just gas and the distinction, just even at a chemical level, but I want to initially come back to.
07:11
how natural gas went from not being part of our energy mix probably a few decades ago, I'm guessing, like probably in the 50s, tell me when it was, to being such a massive part of our energy mix at the moment, specifically in North America, but certainly in other parts of the world as well. How has natural gas generally come to be so dominant and present? And also helped me understand the distinction in terms of energy intensity or carbon intensity between kind of oil and coal versus natural gas versus renewable and obviously...
07:40
sweeping that into one big bucket as well. Like just, let's help, just help me understand a bit more about that context. Yeah. And are you interested in both energy intensity and carbon intensity or mainly just carbon intensity? I think both are important because I think one of the challenges that people overlook is it's very hard to have planes flying around that are powered by current storage methods because of just the energy density is not there. So I think energy potential is important because a lot of the things we want to do with the energy.
08:08
require certain assets. So I think both. Yeah. Okay. I love people to go back and think when there was no energy and eventually we figured out that coal exists, right? And we went from wood to coal, maybe coal to parts of oil and diesel fuel eventually became quite dominant. And then we really learned how to make natural gas. We learned how to hydraulically fracture and find
08:36
large volumes of natural gas and do it very cheaply. And coal eventually is being displaced by natural gas for two reasons. One, it's much better for the environment. It's a massive step forward for environmental benefit. And you can actually do it at not much of an additional cost to coal. In fact, if you really think about the full impact of using coal, disposing of the
09:04
wastes and everything, the environmental cost, then natural gas is probably cheaper. And we can make natural gas plants very efficient. So I would say to answer your question, how did natural gas come out of nowhere into this system? It's because we were able to find vast amounts of it by hydraulic fracturing. And then secondly, that really allowed the supply to go up and the price to come down. Yep.
09:31
And I guess just drilling into that from a little bit more, because you talked specifically about the environmental impact and I think a lot of people and you've avoided specifically the word fracking, but hydraulic fracturing, I'm guessing is the longer term for the long form of that. Yeah. I try not to slang too much unless I'm talking to a known audience, but you're right. I think actually that word probably entered the vernacular over the other one. And I don't want to go down to this rabbit hole too much, but I do want to understand, is it, are we in a place where we've already created an environment, a world?
10:01
where we have massive energy dependency and growing energy dependency. And this is the reality of the world that we live in and the reality of the world we are. So unless we're going back to the donkeys and pots on the side, to paraphrase Louis C.K., we have to accept that there's a huge amount of energy requirement to operate the way we do. And the question now is where is that energy coming from and what is the environmental impact of that, of the sourcing and the usage of that energy? You talked before about how gas, even in its current form, we'll talk about some of the new forms later.
10:31
It's still infinitely better than coal. Just help me understand that or enumerate that in some way. Yeah. And again, it does get back to the two things you mentioned earlier. One energy density would be the term I use. You use energy intensity. It's fine, but it's the amount of energy. So to that end, natural gas is relatively energy dense, not as energy dense as coal, but because it comes in pipes and if you need more, you just can make a bigger pipe and change the pressure. So you have the energy density you need.
11:00
for doing things like making electricity, heating your home, running a factory, making steel, for example. It has that, and when you think about carbon intensity, the carbon intensities can be half that of coal, or even oil. So again, the net benefit to the earth, significantly better under that singular metric of climate. Energy dense enough, I might say, and really not very much to dispose of. With a coal plant,
11:30
We have to think about what we push into the air, all of that CO2 and really a host of other things. Let's don't let's don't hide from it. And then we have to dispose of that fly ash, both of which are problematic, huge users of water, usually, where a natural gas combined cycle power plant exceeds 50% efficiency. So we really use the natural gas smartly.
11:56
doesn't require a lot of land to build a power plant like that compared to solar or wind, for example. So a really good use of land and the earth today. Now you, you've actually already opened up, here we are 15 minutes into our talk and you've gone straight to the heart of the matter, which is if we do push aside the people who are willing to sacrifice their standards of living for a cleaner earth.
12:23
We'll push them off on the side because that's not where most people are. All of us generally want to either maintain our standard of living, or many people want to improve their standard of living. Think about the developing nations, particularly. And so not only do we need to think about the current state of producing power, but we had to think about all the things that we're discussing that use new amounts of power, vehicle charging, cell phone usage.
12:51
more microwaves, three TVs instead of no TVs. And what we see is that people generally don't have robust electric systems. And so we see that we're seeing it in Europe right now in real time. They're resorting to using coal or wood to produce the amount of electricity they need. So they're maintaining their standard of living, but they're doing it by using much dirtier sources of power. And that's what we need to avoid. We need to be more.
13:20
planned and measured than that if we can. And there's probably a few things at play here. And you right up front talked about, you'd be the first, I think your words exactly were that, you'd be the first to say, hey look, coal and wood and oil. And I was gonna put whale oil in there. Forms of energy that we use or have previously used that aren't giving us great environmental benefits. And if you play it back a hundred years ago, we were not thinking about those sources that way. We were like, hey, this is this amazing energy source here. It's energy dense, let's just burn the hell out of it. The environment seems fine because we haven't burnt enough of it yet.
13:49
Is natural gas a step in that overall journey? Is that kind of, and I want to get to propane specifically in a minute, but just in terms of where natural gas plays today, is this a stepping stone? Is that how you think about it? I think it is a very necessary stepping stone. And as a guy who studies the climate and forget the fact that you can decide that I'm a shill for the natural gas industry because propane and natural gas are so inseparably linked, but that's not how we approach our day. We approach our day by trying to figure out what is the right way to get to a cleaner climate.
14:19
And frankly, I think I can have a different answer in parts of Africa that are developing. But for most of the rest of the world, I think natural gas today is a very important step forward because I know that behind natural gas comes renewable natural. And so you're going to see this steady march towards zero of the carbon intensities. And I really can get to a world, I get to a world where we do make renewable power and renewable power.
14:48
takes on different things, I think in Finland or Greenland with so much geothermal, they may look like a hundred percent renewable power, but other parts I hope would aspire to maybe a 50% mix that other 50% could easily be natural gas. And then you can, you and I can debate much later about where nuclear fission or fusion kind of enters this world. I have to say, I think we see it fairly cleanly from 2025 to maybe 2035.
15:17
from 25 to 35 to 50, maybe gets a little bit murkier. And then after 2050, all bets are off. As we think about new forms of batteries, new forms of producing power, particularly fishing and fusion. Both have probably come to a different spot. I got to tell you five years ago, no one talked about nuclear today. We now talk often about small modular. We talk about molten salt. We talk about fusion as though it's a reality. And so.
15:46
Let's see what happens after 2050. Yeah. And I guess where I'm going with it is I think we live in a society where you open a phone and you pull up an app and you get instant gratification. We've expected this is the way large infrastructure works. And the reality of the world that we're in is most of the roads that we drive on were probably made in the fifties or sixties, if you're in Italy, they were probably made two or 300 years ago. And infrastructure at the scale of humanity, not the scale of the individual moves slowly. And there's always this.
16:15
Misunderstanding, I think that you have to understand with what you can do with the infrastructure you have now, because you're making multi-year and multi-decade bets in a way, but also investments around the future of where, in this case, energy is going. And I think it's short-sighted in some respects to be saying this thing that is not ultimately going to be part of our energy mix in the way it is today. I think 100 years from now, will we be doing hydraulic fracturing or fracking and getting natural gas out and powering our world that way? 100 years?
16:45
Probably not, right? We will have. Probably not. I agree. I've developed new technology, but how do we get there faster and how do we minimize the impact along the way? I think is a practical question of what is the best way to do this. And so I think this is where the nub of this kind of dialogue is that if you're looking at a whole bunch of infrastructure, especially in North America, but in other parts of the world as well, that already enable an energy source that is infinitely better than coal to get to a place that powers energy as a stepping stone and a step in the right direction.
17:14
then why wouldn't you do that and get rid of coal as quickly as possible and then move from there? Is that kind of the near term argument? I appreciate the clarity of your statement because I think coal is at the end of its useful life. I think oil and diesel fuel and heating oil should be towards the end of their useful life. We now know that both of those have serious environmental consequences when used and we really haven't figured out how to use them safely and environmentally.
17:44
Soundly. And so that kind of brings us now to the next phase, which would be as I would say, natural gas and propane, but in concert with solar and wind. So they're coming on to in concert with nuclear. And that gets us to really the next step to in, in this evolution of the energy grid, to your point, we've been dealing with diesel fuel for well over a hundred years with coal for probably well over 200 years. And so that shows you for those fuels.
18:13
the pace of evolution. You know, as we'd say, we think they're towards the end of their useful life. And I will tell you, many oil advocates would say I'm wrong, right? That there's a long runway for oil. If there is a long runway for oil, it's because it's been so dominant and it's because humans are resistant to change. Yeah. But it's not, and by the way, for both of those coal and oil, I would advocate that they are replaced.
18:41
as much for human health as I would for climate. Both of those air quality in the light. Not only produce copious amounts of CO2 that we haven't learned to capture yet, they produce large amounts of particulate matter, oxides of nitrogen which are harmful to all our lungs and all our plants and all our animals. And then a couple other horrific emissions that aren't good for the planet or for the humans that inhabit it. Yeah.
19:06
And I want to move us on a little bit from just specifically natural gas and the application of natural gas today. And you touched on it before. Well, there's two parts to this. One is propane specifically. And my understanding is that when you burn propane, what you end up with is, well, what happens when you burn propane? Because it's different from when you burn natural gas in terms of what the resulting outcomes are. Just talk me through those. Well, it's actually fairly similar to what you get from natural gas with the exception of any methane. You get...
19:34
heat or whatever it is, your power, whatever it is you're looking for, you do get CO2. What you don't get would generally be particulate matter or nitrogen oxides. But as we learn to burn it better, and that's what we've done over the last 15 or 20 years, you get less and less CO2. You get more power or more heat and less emissions. Interesting.
20:01
For example, you were talking about the pace of evolution and you said, engines we worked on, I was thinking about, as you said it, I've been in a partnership with Cummins for nearly 10 years, 10 years from the time we thought about the project and began testing it to the time it'll go into the market will be almost a full decade. That shows you about how long it takes from idea to final launch in a modern world. Right. And it will be beautiful.
20:29
But to be honest, we knew five years ago, it'd be beautiful. Now it's making it robust and warranty and getting into the network. Today we're doing, we're making engines that are 25% cleaner in greenhouse gases than the last iteration of engines. And I have no doubt, I have no doubt the next iteration will be cleaner than this. Yeah. And if you put that into the macro perspective though, in terms of where 20
20:54
23 at the moment, we talk about kind of 2035 and 2050 as these big kind of markers in terms of where we need to be. Is there a way in from where you're coming from, is there a way to get there without utilizing this as part of the energy mix or is it you have to do it this way because you just cannot get to the level of scale for the other things that will come and will be a more dominant part of the energy mix in the latter half of the century? Is that kind of where we're at with natural gas and two degree propane? Yes. That's exactly where we're at.
21:23
You cannot get there to scale without sacrificing something. I don't believe anyone's going to sacrifice warmth, hot water, cooking, or a power when they need power. And in fact, a lot of people talk about that's the iron law of electricity. That people will do whatever they need to do to have abundant power. And it should be abundant and affordable. And that's the last piece we really have to add in because you can have abundant power, but that's not affordable.
21:52
And for society to move forward, your power has to be able to be afforded. What's to me, that's the essence of environmental justice to a degree. So yeah, I think this evolution, this next step, and by the way, propane is much more than providing power. If you talk, even though today we're doing, we've always been the, what you thought of for your backup generator for your home, now we've become that backup power for your commercial business or maybe your industrial business. And now we're beginning to talk about.
22:22
prime power applications, I see an opportunity for propane first in the medium duty transportation market. So not cars and maybe not even tractor trailers yet, but just that those vehicles that you see in your community every day delivering packages or flowers or bread or milk or beverages, those should be not running on diesel. Some could be electric and others will need to be on propane. And just on that distinction like...
22:51
If you look at that exact use case, why would it be necessary for some to be on propane, some versus alleged just a distance and time thing? Or what is it? Because of the payloads they carry, the distances they run, perhaps the temperatures in which they run. People don't really realize the limitations of batteries at very high temperatures or very low temperatures. Most of the fleets we work with, batteries aren't really a choice for them. Either their payloads are too heavy or their ranges are too far. And we're a long ways yet from having affordable.
23:20
medium duty trucks that are battery powered electric. I think most listeners don't realize, and I know we're moving into transportation for a second, but most listeners don't realize that the battery that's in your passenger car looks nothing like the battery that's in a truck. Most people think a battery is a battery, but I kind of love to quote the chairman of Toyota when he, cause the chairman of Toyota is very much in agreement with my views in that hybrid.
23:49
applications are brilliant for a world that needs everything at once, right? They need, and he's quick to point the batteries that go into one truck would provide enough minerals for 90 of his Priuses. Right. 90. In a world that's probably going to be constrained about battery minerals and battery processing, we have to think about some alternative ways to do it. And is some of this about buying enough time to be able to go down those rabbit holes, both on the
24:18
renewable energy, renewable gas aspect, which we'll talk about in a sec, but also in the renewable, whether it's a storage issue, there's a lot of talk at the moment, as you said, front about fusion or even other forms of fission based nuclear, but also even just battery storage generally. Like we're pretty dependent on lithium ion as our main source of how we think about batteries. Even like a sodium based battery storage option, maybe 20 years away, but if it's really good in 20 years, we still need to get from here to there. Is that part of this? Absolutely.
24:47
People that listen to me speak say, you can tell you really do believe in technology and innovation and I do. And it's getting rid and actually is having the guts to get rid of the things we should get rid of now, coal and oil and wood and move into the next things, natural gas and propane and renewable natural gas and renewable propane, uh, solar and wind and geothermal and all those other things. While to your point, not only while we are improving the things that look like they're going to be good for the next 10 or 20 years,
25:17
while we're buying some time to see what we really can do. I'm convinced that the batteries that our children will rely on aren't even in the labs today, right? They're just a thought in someone's head and they probably won't involve lithium or other minerals. And it's there. And by the way, stationary batteries are different than mobile batteries, but yeah, for sure we are on, I believe now this nice path of innovation.
25:46
as we move to a cleaner system of energy, not just power, not just electrical power, but because I do believe it's not going to be, I don't really believe that this narrow path is only via electricity. We see it too often and that's not a resilient path. And people, people need reliability. They need environmentally friendly, but they also need resilience. They need to know that when they turn on the switch.
26:16
powers there. It's going to be more important in 10 years from now. Think about, you've already talked about your cell phone twice. That wasn't even something we talked about 30 years ago, right? And now without your cell phone charged and available to you, we're all at a loss. Personally, I've had a cell phone since I was 16 and part of me can't wait to not have a cell phone. But your point is absolutely valid regardless. I want to talk just its distinction before we get onto innovation in renewable energy.
26:42
in gas and propane specifically. And I think this innovation is a really important one. Just trying to understand this distinction between electrification, turning a light on clearly as electricity, getting a plane in the air, electricity, just debatable whether you're ever gonna get the energy to wait that you need. Like what are the things we don't think about when that are really a much, much better use cases for higher density energy sources like gas, like other than planes, what else are we talking about here?
27:12
Well, we'd be talking about heavy duty industry, making steel, making cement, making fertilizer, transportation, I might argue would certainly be one. You talk about planes could very well apply to a locomotives as well. Although locomote and shipping, locomotives don't quite as much have a weight problem compared to ships or planes, but it also impacts trucks, right? Trucks, trucks are going to only carry a certain amount of weight. And.
27:41
That weight can be the goods they carry or that weight could be the batteries they carry. But at the end of the day, if they carry more batteries, they're going to carry less weight. And if they carry less weight, it's going to cost you more to receive your packages. And so people don't really realize how all of that's interrelated, but it's totally interrelated. But I think planes are the perfect example to, I would say that the world begins to accept liquid fuels. We're going to move from aviation fuel, as you know it today.
28:10
to what they have termed as SAF, sustainable aviation fuel. Sustainable aviation fuel behaves just like renewable propane to a degree. In fact, there are a lot of the plants that make one make both. But it's interesting as the world tends to push back against renewable liquid fuels, very few people do push back against renewable aviation fuel.
28:35
Cause they're like, well, we don't have any other options. So why would we push back on that? I don't think people are going to push back against renewable shipping fuel. Right. It's intuitive. And by the way, ships are a perfect example. They used to burn the heaviest, ugliest form of oil known to man because nobody cared what their emissions look like. And it was cheap. And now they're under tremendous pressure to improve their emissions. And they're searching for those. We're actually moving more ships.
29:04
today using propane than I ever dreamed we would 10 years ago. And I was a part of the group that was studying it. Yeah. Propane and liquefied natural gas, again, back to your energy density question, are two really good fuels for ships. Much cleaner, much, much cleaner, much cheaper for them than any other alternative. Okay. And that's so just because I think I needed that term liquid fuel, because that's what's useful here is to understand how you get.
29:32
the level of energy density for a whole bunch of applications. And to your point, the ability for, if you turn it on, it's there, you don't need to worry about some externality and a battery as a source of that, as long as you can make the power to weight ratio work. So I want to get onto innovation a little bit, and I want to just try to bridge this through two kind of lenses, I think one is the, and the innovation in the context of environmental impact specifically. And so I'm interested in two lenses, one being the environmental impact of getting the thing or making the thing.
30:01
And then the environmental impact in using the thing, because I think those two lenses are both important, right? If it's really a non-energy, environmentally sound to pull this thing out of the ground and doesn't affect the environment at all when you do it, then okay, that looks fine. But then if you burn it, it has a really negative environmental impact. So why don't we just start with what innovations we're seeing in liquid fuels and that we can use that broadly to cover propane, natural gas, whatever else we want. Firstly, in the production and the manufacturer or the sourcing of these gases. And then we can talk about...
30:31
the actual usage. I want to commend you because you've already described something that I find very few people want to talk about. And we won't start a conversation without thinking about what we would tend to call the full economic impact or the full economic analysis, cradle to grave, well to wheels. It's often used, but it's so important to think about this as a system from beginning to end. The classic example to me is most people refer to their car. They use drive a battery electric car.
30:59
as a zero emission vehicle. Right. Well, they could call it a zero tailpipe emission vehicle if they want. And I probably would not be offended, but it's highly offensive to me and probably to people that live near the power plant when the power plant's output is two times what it used to be because they're driving an emission free vehicle. It's not, it's not emission free. The emissions have been pushed upstream. So when you talk about this cradle to grave analysis, I'm very supportive. And then there's a term for it, right? It's the.
31:29
full economic impact or the full economic analysis of that system. So now I'm going to ask you a question because that's where we are with renewable fuels. And by the way, we've been working with renewable fuels for probably about a decade, but we've moved further in the last two years than we moved in the previous eight. So in renewable fuels, you start with a feedstock and then you have to think about how you convert that feedstock to what it is you're trying to make.
31:57
Sometimes that's efficient. Sometimes it's not efficient. So we think about this on a very big scale first. Where are there lots of abundant feedstocks? Classic example, used cooking oil, waste agricultural products, manure from farm animals, right? All of those things are quite numerous. And actually if you could capture them and turn them into energy, it's a double benefit.
32:27
You're taking a waste product and now turning it, if you can turn it efficiently, into a useful form of energy. And that's exactly what the propane industry has been doing. The natural gas industry actually to a degree, even renewable diesel or sustainable aviation fuel is looking for these waste products. The natural gas industry has been doing it for some time with the methane that's coming off of landfills, solid waste landfills.
32:54
They convert that meth, they capture that methane and then use it. They call it renewable natural gas. But instead of going into the atmosphere, they capture it and allow it to be. Used in their systems. Okay. So one of the buckets here is there's a whole bunch of waste materials that could be leveraged to be turned into an energy source and we're not doing that today. And by not doing it, we're either having environmental degradation where we leave these waste materials and, or the.
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byproduct of not doing it is that it gets into the environment anyway, without us being able to utilize it. And so therefore, let's leverage that. And I think there's another bucket of this kind of innovation that's happening in liquid fuels around actually creating the environment or the conditions to create a feedstock, as you called it. And I'm thinking here about biofuels and that there's a whole spectrum of biofuel options. Can we talk about both the other side of that as well?
33:47
Yeah. So would you be thinking about like allergies or kelp or some of those kinds of things? Yeah. Where we're looking to take products again, that we can create that efficiently convert into energy. So a couple that come to mind for me would be the classic would be talking about allergies or products that we can grow that convert. We're actually actively involved in finding on food cover crops. So
34:15
completely out of the debate of food versus fuel. And we take a genetically modified drought tolerant cover crop. So farmers don't stop growing corn or soybeans or whatever they grow, but when their crop is in, they plant this, it germinates quickly. They combine it with their normal materials and it produces really three things. Food for their animals, a bean that easily crushes that we can turn into propane, and to a degree, a little bit of
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waste material that they put back on the soil as a soil ingredient. So there's a classic example of, of something that we have devised just over the last five or six years that will easily become energy, but it plays exactly in with the farmer's natural rotation of crops in his system. And we make money from that. Yeah. And what's, there's two things that I'm curious about with this. One of them is more a comment.
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which is that there is an existing system, in this case, the farm system and the energy system, and what you're doing is putting innovation that actually allows that system to be even better utilized for the creation of a better form of energy rather than digging it out of the ground. So that's the first aspect of that. The second aspect of this is just the time scale in which this operates, right? So if you develop this plant that can go in between crop cycles, how quickly is it that a farmer who has a meaningful amount of land can find the economic...
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basis for them going and doing that to then be able to give you the feedstock to then turn into energy. Is that part of what's at play here? Which is you don't have to do multi-decade type investment and hopefully the R&D pays off. You already know this, all this stuff works and once it's produced, you can get it to market so you can move faster to get it to scale. Is that part of it? Yeah. Our first plan is online as we speak and we're really proving out all of these concepts. One, the farmer can make money at it and do it in a way that...
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benefits his land and benefits his land use techniques. Yes. And again, it's exciting because if this works, it will be useful, I think, in all of the continents is not uniquely American or it's drought tolerant. And as long as you have available land, I think they need an inch and a half of water during the growing season and they feel like they can make the crop. So yeah. And that's a classic example. And I think it's a great way that we're looking for this wide path of energy waste products.
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how you, and by the way, they're not going to all be propane, right? As we look at this magnitude of waste products from all things, some will become renewable propane, some will become renewable natural gas, some will be sustainable aviation fuel. Some might be renewable diesel. Some will turn into methanol or other products, right? Every feedstock kind of has its preferred way to convert it to energy using the least amount of conversion.
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And to me, sometimes I think about often land use, water, and the final end products costs, because that's what it's all about, right? To your point earlier, the system has to be sound, but we have to do it at a reasonable cost. Yeah. Well, I mean, I think there's an economic reality to everything we're doing. I think part of the thing I wanted to not challenge you on necessarily, but just dive into, because I think, I don't know, the heuristics for everyone is, well, this one looks cheap, this one looks expensive.
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but we should do the more expensive one because it's better and we have an obligation to do that. And I'm not sure if I think either both are true or both are wrong. But I think that probably doesn't fully appreciate the actual cost to deliver the thing holistically. And so if we take this example of a farmer who is going to plant a whole massive crop that is then going to be able to be turned into a biofuel or renewable form of a biofuel, if you like, that can then be utilized versus someone saying, well,
38:03
Why wouldn't you've got all this spare land in the next paddock? Why wouldn't you put solar things there? You must be in a position where you can see both of those sides of the argument and actually stack the two next to each other. Like just not worrying about the liquid versus electrification at the moment. I think that's how we try to start most of these arguments. Cause then why I'm quick to say we're always looking for ways to make sure that things are working in concert with solar and wind when it works, but going back to your energy density conversation.
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The energy densities for solar and wind are really difficult to achieve at scale. I don't really believe, in fact, we're seeing in the U S in real time that so many people are beginning to reject solar fields because it's largely benefiting urban societies, but impacting rural societies. Most, we're now seeing a pretty strong backlash against, I just don't want one more wind farm. I don't want another big solar field, but I'm quick to say.
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that we need all of those technologies working together until we perfect something that we haven't perfected yet, whether that's nuclear or hydro or pump storage or something. And I believe that's that system that comes together with absolute certainty. We want to go forward using solar and wind, low carbon solutions. They're renewable cousins. That's the only way we're going to get to an abundant and affordable energy system.
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And it doesn't really matter whether you're in Australia or North America, or you're in Sub-Saharan Africa. Yeah. Like you said this right up front, this energy systems are massively interrelated and highly complex and like oversimplification of why don't we just have enough? I think the, one of the ones that I see quite often, which I query, because when you really dig into it, it's challenging. They're like, if we enough energy from the sun hits the planet, that you could just have a solar farm of this big and you would power all the energy needs.
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for the world and I'm like, sure, but how would any of that energy gets where it needs to get to or how would it be utilized in the time that it's not available? It's not reality, it's like oversimplification of the problem. But I think part of what I'm still curious about is not only the energy manufacturing part of it, but just take for example, we're 50 years away from a massive energy breakthrough that has no emission outcome like a CO2 or methane emission outcome. If we do...
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shift to an energy mix that you're talking about where we don't have coal, we don't have oil for a lot of these heavy burning industries and we're using natural gas as a liquid fuel that has been sourced renewably. What is the energy output of using that thing regardless of where it's sourced? And is that enough? If you have 8 billion people and you're having to use that energy? Yeah. So I start by thinking about the carbon intensity of the finished product, which to me is a really good way to quantify its impact.
40:49
on the climate show. And today it's easy to say we look at the carbon intensity of the grid in America as a unit of the collection of the nuclear, the hydro and all that. And that carbon intensity today is about 150. So I can give you all the units behind it, but just work with me for the number. The carbon intensity of conventional propane or that matter, conventional natural gas is almost half that 80. Right. So as we think about today,
41:17
Would you be if you want to lower your carbon, you'd really be better to use less electricity and more natural gas or propane today. And clearly those numbers will come down. So we're all trying to get to zero. So these renewable fuels, can they in fact be zero? Could they in fact be minus 10? So go back to that camelina I'm talking about. What's camelina? Oh, I'm sorry. That's that drought tolerant non-food cover crop camelina plant. That plant that produces it today.
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values the carbon intensity of that as seven. So virtually zero. Now that already takes into account the farmer's diesel fuel for that tractor and actually the diesel fuel that's consumed by the train that takes it from the depot to the facility. It's all input, but I'm certain that as that system is more perfected, the carbon intensity will move closer to zero. And if you had to put solar on that graph.
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Just as an example, if you had to put solar on for that graph of 150 down to zero. So solar, very dependent on solar is never zero. No, because the panels must be made. It takes diesel fuel, but solar's relatively low. I don't, I don't know the number for solar off the top of my head, but solar and wind, really the inputs are where the big numbers are, the glass, the construction cost. Yeah. The energy to produce. It's comparable probably, but again,
42:40
Again, and that's, I think that's where we are. We always think is a, is it cleaner than the grid today? That's a step in the right direction. Is it cleaner than diesel fuel today? These. So the answer to that's clearly yes. And then is there a path to zero near zero or perhaps below zero? That's where we all begin to get excited about that as a commercially viable product. Yeah.
43:03
Yeah, wonderful. And there's probably at least another hour or two that we could go into this. And we're not going to, but there is going to be a bunch of links. I love your questions at this point. You're at a level of practicality, but also a level of thoughtfulness that very few people achieve. And I commend you for that. Thank you. Well, yeah, I definitely, as I said, right up front, I had to do a lot more research on this one, because I was like, I really have to understand this to be able to ask real questions on this. And I don't know that I've covered them all. And so I'm not going to try to cover them all. I think there's an awful lot of opportunity.
43:33
ideally to maybe have got people to think a bit differently about this stuff and hopefully to go in and dive in a bit more. Just before we finish up today, part of when I did my research was also trying to understand your background because it sounds counterintuitive to me for someone like coming off the back of being an inner city suburbanite person living in a city type stereotype to be talking to someone who is talking about natural gas but also has spent
44:00
multi-decades thinking about renewables generally, I just want to understand how you have arrived here and just the arc of that story before we finish today. Well, I think I've always thought about conservation and leaving the earth in a little bit better place than you find it. I think whether you're riding your bicycle and you stop and pick up a bottle that somebody threw on the side of the road or whether you have often thought about two things we haven't talked about today, right? Conservation in general, conservation of resources.
44:29
And then also water quality always been consumed to me. I live in a beautiful spot and I've always enjoyed hiking. I live in the United States on the East coast in Virginia, kind of on a tributary of the Chesapeake Bay, a beautiful spot where we love the sail and fish and kayak and swim and kind of live in harmony with clean air and clean water. It's a beautiful thing. But so, so then I actually started off doing land use things where we were
44:58
talking about how to design and develop walkable cities and have a better environment yet in the urban built environment. And it eventually transitioned me now to really thinking about the whole energy system, and I would say we're not trying to prove our propane fits. We're trying to look at this, at the problems and then find solutions and hope that propane is a part of that. But if it's not, we move on. So it's been a really interesting journey. I'm not.
45:27
It's funny as I was laboring early and developing neighborhoods or even building pipelines or natural gas facilities. You realize now how it all shaped you for what you're doing in the last part of your career, I think. Yeah. I, as I said, I think that I think you're definitely making it a shorter version of that overall story and that's okay. But I'm absolutely curious as to how you've arrived at that. Yeah. Super interesting for me.
45:53
Yeah. Just in terms of any final words from you with regards to, for anyone who's listening to this, to try to get them, to challenge them, to rethink natural gas or propane specifically and just liquid fuels in general, like I think let's close on that. Well, I think the part we love to talk about is this concept that electrification will be the end all solution is probably incorrect, right? That the best path is a wider path, but one that achieves the same goals, right? Let's reduce carbon emissions. Let's make our people healthier.
46:22
Let's be able to afford those solutions and let's do it as fast as we possibly can. Let's don't wait. They always say that perfect is the enemy of it, right? You know, I'm waiting for perfect to come along. Well, let's do what we can do now. It's just things that you've alluded to for this whole hour about let's make steps today that we can do today because every pound of CO2 we reduce today is beneficial to us rather than a pound reduced five years from now. So that that's part A.
46:51
The path is much broader than that narrow path of electrification. Electrification is but one path, and we can achieve transportation, the built environment, those hard to electrify sectors like rural America, maybe manufacturing to a degree. There is a broader path, and that broader path involves propane and natural gas today, renewable propane, renewable natural gas tomorrow. They are part of the solution.
47:20
Wonderful. All right. We'll leave it there. Taka. Thank you again for allowing for some of my questions and really going deep with us today. It has been a fascinating conversation and I thank you so much for having me. Absolutely.
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