Catalyst with Shayle Kann - Enter the electric supercycle

Episode Date: June 18, 2026

While many energy insiders remain focused on the staggering demand coming from AI and data centers, a much larger and far-reaching shift is happening. We are entering what Energy Impact Partners’ head of research Andy Lubershane calls the "electric supercycle" — a series of interlocking technological flywheels that are accelerating the clean energy transition faster than many may realize. In this episode, Shayle sits down with Andy to map out the interconnected nature of the "electric stack.” They unpack how early investments in solar and EVs are scaling up technologies that are now feeding back into grid infrastructure, and look ahead to the massive electricity demands of the coming robotics and defense industry boom. They also consider the pressing question of the ultimate rate limiters for meeting this demand. Shayle and Andy discuss topics like: - The power grid supply crunch - Why electricity prices have tracked inflation so far, but may surge past it when equipment costs hit retail customer bills. - The four pillars of the electroindustrial tech stack: Solar PV, lithium-ion batteries, EVs, and wide-bandgap power electronics - How a "Robo-Butler" load profile compares to other household appliances - How the defense industry could catalyze climate tech, especially batteries - Why physical transmission corridors remain the top rate limiter for the energy transition - Andy Lubershane’s Substack post, “Riding the Electric Supercycle” - Catalyst: Five big questions about the future of energy (with Andy Lubershane) - Catalyst: Surprising trends in global electricity generation - Catalyst: Live from Transition-AI 2026: Inside Google’s massive AI capex - Catalyst: AI scaling pathways: On grid, on edge, off grid, off planet - Open Circuit: America’s electricity rage is here - Open Circuit: Have we run out of big ideas to fix the grid? Credits: Hosted by Shayle Kann. Produced and edited by Max Savage Levenson. Original music and engineering by Sean Marquand. Stephen Lacey is our executive editor. Tune into Critical Capital, a brand new podcast from Crux and Latitude Studios. Hosted by Crux CEO Alfred Johnson, Critical Capital explores the interlocking forces powering clean and critical infrastructure. Join us every other Tuesday for in-depth conversations at the intersection of energy, government, finance, and global markets. Listen here, or wherever you get podcasts. Catalyst is brought to you by FischTank PR, an award-winning climate and energy tech, renewables, and sustainability-focused PR firm dedicated to elevating the work of both early-stage and established companies. Learn more about their PR approach and how they can support your company’s messaging by visiting fischtankpr.com. Catalyst is brought to you by EnergyHub. EnergyHub helps utilities build next-generation virtual power plants that unlock reliable flexibility at every level of the grid. See how EnergyHub helps unlock the power of flexibility at scale, and deliver more value through cross-DER dispatch with their leading Edge DERMS platform, by visiting energyhub.com.

Latitude Media covering the new frontiers of the energy transition. I'm Shail Khan. I lead the early stage venture strategy at energy impact partners. Welcome to Catalyst. So the electric super cycle, remember that term. It's what we at EIP have started to use to describe the unprecedented times that we're in right now in the power sector and why I think most people still haven't actually woken up to just how dramatic this next phase of the market is going to be. Anyway, Andy Lubershane, if you're a right, regular listener, you know him, you love him. He's my partner and our head of research at EIP, and he wrote the first of what I think will be a bunch of pieces on the electric super cycle a

couple weeks ago. This one was focused on the hidden feedback loops within electro tech or the electric stack or whatever you want to call it that compound and drive more and more momentum in this space. So we ran through it. Andy's coming up after the break. Trillions of dollars are flowing into clean and critical infrastructure, but those investments aren't driven by technology alone. They're shaped by markets, by policy, by capital, and by the institutions that connect them. I'm Alfred Johnson, CEO of Crux,

and host of a brand new podcast, Critical Capital. Each episode, I talk with people deploying capital, shaping policy and building the clean economy. Tune in as we unpack how progress is actually made. Listen to Critical Capital on Spotify, Apple or wherever you get your podcasts. Catalyst is supported by Fish Tank PR. An award-winning PR firm focused on climate and energy tech, renewables, and sustainability.

Fish Tank is known for generating prominent and effective media coverage for the brands they work with. If you want a PR partner that's thoughtful, shoots straight, and gets results, you'll like Fish Tank PR. To learn more about Fish Tank's approach, visit fish tankpr.com. That's F-I-S-C-H-Fish-Tankpr.com. utilities need flexible capacity they can count on, they turn to Energy Hub. Energy Hub works with more than 170 utilities, coordinating over 2.5 million devices to manage 3.4 gigawatts of flexibility, built for the moments when utilities can't afford uncertainty. Energy Hub builds and operates virtual power plants that utilities actually stake their grid

planning on, coordinating EVs, batteries, thermostats, and more through a single platform built for utility scale. Predictive, verifiable, and designed to perform when it count. Learn more at energy hub.com. Andy, welcome back. Thank you, Shail. This is my first catalyst video edition. So it's a whole new world for me in podcasting. You're looking good.

Okay, so I think everybody who's listening to this probably knows that like there's lots of electricity, demand growth, et cetera, et cetera. But I think we should start by talking through some of the ways that's manifesting. Like if you're trying to build new electricity generation, or remove electricity right now. What does it look like to you? I mean, it's not just everybody that listens to this podcast. I think everybody in the world now,

anyone who's paying attention to the economy in almost any way is familiar with the impacts of the AI boom on the energy sector, and specifically the power sector, and how many bottlenecks there are, basically. I mean, that's something you and I've been talking about for the past three years, basically, is this idea of the electricity,

gauntlet, which is sort of the narrow path that the power sector, the electricity business, and anyone in it has to walk between this kind of wall of surging demand on one side and bottlenecks on supply, which are really popping up at every level of the system, I think, from generation to transmission, distribution all the way on down. And that's the state we're in today. We've been there, I think, for about 18 months. And so if you... If you are anyone in the market right now that can deliver some piece of equipment to alleviate those bottlenecks at any level of the system, you're feeling pretty good right now. Yeah, let's talk through briefly at least a couple of those things that you can sell to potentially alleviate and like what's happening in those markets. We've talked before on this podcast a little bit about gas turbines, but what's the state of the gas turbine supply chain?

what's the state of the power grid equipment supply chain, the renewable supply chain, this is pretty broad at this point. Yeah, I think overall, it's pretty similar dynamics in all of these, for each of these pieces of equipment, which is that anything you want to order today is probably going to take three plus years in the case of gas turbines,

probably more like five years, to be able to get your hands on. Anything you order today, whether it's a turbine or a truble. or a transformer or just the aluminum or copper conductor or switch gear, like any of those common building blocks of the grid is going to probably cost two to three times as much as it did five years ago. We saw these increases in prices for just about everything

in the power grid supply chain during COVID. And I think there was an expectation that after a few years, those supply chain crunches would alleviate, just like many of the other bottlenecks and global supply chains we saw throughout the economy, but that hasn't happened because demand has continued to surge so much. So prices have really remained

elevated well above inflation for all that stuff since the pandemic. And so, yeah, that's the basic story, is like things are taking three to five years to potentially deliver and costing

two to three times as much as they used to. And I think one thing people don't think about as much as they should is that the time lag between those price increases for equipment and then what retail customers see. Like affordability has become the name of the game. It's the word that's being used in every circle of electricity world. It has bled out into the broader political body, right? We see this now being issued elections and so on. And yet, actually, it still hasn't really hit yet for the most part, because it takes some time. There's a lag between when these prices of things increase and then the effect on retail rates.

So in some ways, I think it's good that affordability has become a big issue now because we're looking out into the future where, you know, the broad overarching trend is probably that it's going to get worse before it gets better. Yeah, it's frightening. I completely agree with you. The worst is kind of yet to come because so far, actually, the retail electricity price increases that we've seen in the past five years have actually tracked pretty much with inflation overall.

It's a little different in different rate classes, and depends where you are in the country, of course. There's a lot of heterogeneity. But on average, across the United States, actually electricity prices have risen pretty much in line with inflation. So in nominal terms, they've gone up quite a bit because everything has gotten more expensive. But in real terms, they really haven't yet. And I have a very high degree of confidence that moving forward, because as you said, all this stuff is leading indicators, prices are going to rise faster than inflation overall. And because electricity is sort of a foundational good for the economy,

they'll actually be a feedback loop or they're a driver of inflation too. So, yeah, I think the affordability dialogue and the political salience of affordability is sadly just getting started. Okay, so you might listen to what we've just been talking about, and think that actually this is like a bearish statement about the future of electricity because, yes, we have all this new demand, but it has resulted in supply chains getting gummed up and then more importantly in prices rising and more to come at the retail level. And yet, I think the thing that you and I are here to talk about mostly is kind of the opposite, which is we think that there is a

super cycle that we are in the early stages of. And so despite all the challenges in getting new electricity supply online in getting that delivered to customers and in keeping rates low. I think both you and I, having spent a bunch of time on this recently, are increasingly bullish on the future of electricity. So start by making the case at the high level. Yeah, I feel like for the past three plus years, I've often been sort of the Herald of Doom in a lot of rooms with colleagues and friends in the power sector sort of describing the state of affairs, which has continued to get, you know, to get more challenging over time. But in many ways, that's because we're at the tightest pinch point in this gauntlet. And that is, of course, driven by the

just extraordinary boom and demand from data centers that is happening right now. And I'm pretty confident is going to continue to be happening for the next three to five years. And honestly, who knows after that. But I think the reason to be bullish is that, that I don't think that this phenomenon is only caused by the data center boom and the supply crunches that are occurring because of it. I think that this really is a generational phenomenon of the growing importance of electricity as a form of energy in society, which is being caused by data centers, by electrification of transport, electrification of heat. by all kinds of other new

precision manufacturing which by and large is driven by electrical processes these days and while data centers I think rightly so get a lot of the attention right now because they are by far the biggest source of new demand

in the system I think they're the least certain form of demand in my opinion when you think five, ten, 15 years out and all of these other forms of growing electricity demand around the world, largely from electrification, I think have a lot more sort of robust, very clear secular tailwinds over that period. And so I remain very confident in the

sort of steady march forward of electricity demand for really decades to come, well beyond the data center-driven crunch that we're in right now. So that's one reason, I think, to be excited about it. The other is because of technology and supply chains, which I think are increasingly creating flywheels in favor of more electrification, even though at the moment things feel pretty rough for the power system supply chain. Yeah, I want to talk about these flywheels

because I think these are what are most underappreciated. But on the first point, I periodically remind people that in Western countries, in the United States, example, electricity currently accounts for something like 20% of final energy demand. So just in terms of stealing market share, this was the trajectory we were already on prior to AI showing up, which is electrifying a bunch of things, as you said, passenger transportation in particular, and that heavy-duty transportation and heating and some industrial processes and so on. And so, like, that was like a slower, admittedly, but ongoing trend that looked like it was going to have a couple of

decades of legs in it. And then on top of that, AI shows up and supercharges demand. And in some ways, that creates a challenge for all the other types of electrification. Like, it's sucking all the oxygen out of the room. If you're trying to do, you know, electrified industrial processes, good luck finding a site that can host 100 megawatts of power that isn't already taken by a data center developer. But on the other hand, it also comes with a flood of money that is starting to be directed toward infrastructure upgrades. that are ultimately going to benefit other things as well. And so it's going to take some time,

and this is going to be this cyclical situation where sometimes it feels like the only thing that matters is AI, and other times it's going to be like AI is the catalyst that enables electrification of other things. But it is worth remembering that we have 80% of final energy demand still to eat up as a share for electricity, setting aside that net new growth that comes from AI. On balance in the near term,

this AI demand-driven crunch and price increases represent a challenge for electrification. But we've always thought that this was going to be the project of decades. There's going to be bumps in the road along the way. There's going to be a lot of regional differences in terms of where electricity demand growth is happening, where electricity is able to steal market share away from the direct combustion of fossil fuels.

But I thought actually this was an interesting data point, the IEA recently came out with some data recently on global electricity demand growth. And it turns out that last year in 2025, from a global standpoint, there was almost exactly as much electricity demand growth around the world from electric vehicles as there were from data centers. It's probably not going to be the case in 2026, 27, but it's worth pointing out that having a purely U.S. focus perspective anchors you a little more on data centers than looking at things from a global standpoint. Right. Okay, well, let's move on to the feedback loops bit because I think the reason, yes, there's this existing trend and, you know, AI is going to

accelerate it and so on. But I think the more interesting thing here is what you and I've been thinking through in terms of the interconnected nature of some of the technologies that are being driven in different sectors, but all tied to what people call it the electric stack or electrotech or whatever. But let's talk through a couple of these feedback loops. Give me one to start. I think the core feedback loop at the center of all of this is really between these four building blocks in the electro-industrial tech stack, which are historically and And I think for a long time to come will remain solar photovoltaics, batteries, predominantly lithium-ion batteries at this point. There may be some other branches off that family tree.

Electric vehicles and associated component tree predominantly electric motors. And then power electronics, which are sort of the lesser-known fourth leg of the stool, because they're less visible to the common person but are sort of the, connective tissue between all of that stuff. And the feedback loops, there are multiple sort of feedback loops within that system, right? For example, as you deploy more solar into power systems around the world, the value of energy storage increases. And so the ability to deploy batteries at grid scale cost effectively to make use of some

amount of excess solar energy during a few hours of the day, and then use that to support peak capacity during a few hours of the day, when you have a deficit, becomes more valuable, and that creates a new market for batteries. Similarly, electric vehicles, which I really think are the sort of the keystone species of this ecosystem, mainly because there's just so many unit sales of electric vehicles. So as that market ramped up, it created a lot more mass manufacturing demand and capacity for all of this stuff. Electric vehicles have obviously had this tremendous impact on batteries, but electric vehicles themselves benefited from early investments from the solar industry

in power electronics, in wide-band gap semiconductor materials, which enable higher voltage, higher frequency switching, which is really important for allowing a battery to run the traction motors on a vehicle and to do high-powered fast charging. So you can start to see how all of this stuff connects at a supply chain level and is sort of compounding on itself over time. Yeah, the power electronics one is interesting, because as you said,

early investments from the solar industry in wide band gap semiconductors, EVs really scale that stuff up. EVs are where silicon carbide reaches its glory. And then now a number of companies, hair and power included, which we're investors in and Drew was on this podcast a while ago, talking about it,

now taking that technology that was scaled up in EVs and then bringing it back to the grid to use for solar inverters or to use for transformer replacements on the grid and so on. So you've got this like circular nature of one portion of the electric stack, you know, invest early in a new technology. It's scaled up by another one and then it comes back to that first one ultimately. And because there's this common need to move, transport, change the voltage of power, a bunch of the things in the electric stack are all common across different parts of that ecosystem,

you get this compounding effect. Right. And then it all sort of comes back to electricity demand growth in the end, right? Electric vehicles are this vector for electricity demand growth, which creates more need to invest in grid infrastructure. And that need to invest in grid infrastructure presents an opportunity for power grid operators to experiment with new technology, kind of creates the necessity for them

to look to something like solid state power electronics at grid scale to interconnect solar, to interconnect high electric vehicle charging, to interconnect high voltage data centers. And so you're sort of simultaneously seeing compounding of need and investment in supply and technology improvement at the same time, which is at the core of these flywheels

And one of the reasons to believe this is a positive super cycle over time and not just something that is going to kind of continuously create bottlenecks and constraints throughout the system for decades to come. We're living through a profound economic shift, and energy sits at the center of all of it. Trillions of dollars are flowing into power plants, transmission lines, battery factories, data centers, but the future of energy is in shape.

by technology alone. It's shaped by markets, by policy, by capital, and by the institutions that connect them. I'm Alfred Johnson, CEO of Crux, the capital platform for the clean economy. Join me for my brand new show, Critical Capital. As I talk with people deploying capital, shaping policy and building projects. Together, we unpack how risk is priced, how incentives are structured, and how progress is actually made. Listen to Critical Capital on Spotify, Apple, or wherever you get your podcasts. Are you tired of overpaying for big-name PR firms, but not really knowing what they're delivering? Is your comms team wasting time reviewing lengthy messaging briefs and decks, instead of engaging journalists or producing content?

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That's fiscichfishtankpr.com. Virtual power plants are becoming a reliable way for utilities to manage capacity, but enrolling devices is just the start. What really matters is confidence, knowing those resources will perform when dispatched and being able to prove it from the control room to the living room.

Energy Hub's platform, handles the full picture, from near real-time forecasting, locational dispatch, and the kind of rigorous verification that holds up when regulators, grid operators, or leadership ask, did it deliver? Easy enrollment creates momentum, proven performance builds trust. That's why more than 170 utilities rely on Energy Hub to manage over 2.5 million devices delivering 3.4 gigawatts of flexible capacity. See what that looks like at energyhub.com. Another one that I'm just thinking about on the spot is like microgrid controllers to an extent. Because the early investment in microgrid controllers and the whole suite of things that are required to manage like a mini-grid or multiple assets at a single site, that has been ongoing for a decade plus, right?

You have off-grid situations. You have other like campus microgrids that have been developed and so on. and then increasingly with heterogeneous sources of power and storage. So batteries got included in microgrids at some point. You have usually generation, maybe some mix of like solar and a gas turbine or whatever it might be. And that's gotten more and more sophisticated. And then now you have data centers that want to see a bunch of behind-the-meter resources get connected and orchestrated in concert and then get ultimately connected to the grid

because usually what's happening is that if the data center is operating off-grid, it's temporary. It's a bridge power situation. Eventually they're going to get connected to the grid. Now you need to coordinate all those on-site resources that you have with the grid as well. And I feel like that early investment in how to manage a microgrid at a much smaller scale, admittedly, there weren't many gigawatt-scale microgrids historically. But scale up what people were doing at hospitals and campuses, and that's kind of what people are starting to think about doing at data centers now.

Right. You took an early niche, a little bit of initial investment to create the basic technology. Data centers are taking it to 11, right? They're taking it to a thousand to gigawatts scale. And actually, you could see the cycle being completed at EV charging hubs, right? Especially as we see more need for autonomous vehicle charging hubs, which I think is yet another one of the feedback loops in this cycle. But as you see, the need for charging depots at megawatt scale, maybe 10 megawatt scale, 20 megawatt scale, the same expertise in

islandable large-scale power systems that are grid-connected but can take themselves offline, can provide peak capacity to the grid, can ensure that they're never drawing beyond a certain amount of capacity from the grid. That same kind of technology, I think, will be deployed at EV charging depots as they scale up as well. And probably we'll have, by the way, batteries on site. if they are highway-based charging depots, they might even be interconnected with a solar project that is nearby.

So again, you can see these four building blocks coming together in more and more ways over time. All right, so you mentioned autonomous vehicles. We should talk about autonomous vehicles themselves and the way that they compound growth for electricity. I mean, people, I think, probably understand that autonomous vehicles are almost certainly endemically electric vehicles. Like, it makes more sense for them to be electric vehicles, and the proof is in the

pudding, all of the autonomous vehicles on the road today are electric vehicles, right? That is true of all the Waymo's, that is obviously true of the Tesla Robotaxies. Like, to the extent that we have them, they are electric. But it also, that's not coincidental. It makes more sense. And so there's this obvious feedback loop of, like, autonomy breeds electrification, which accelerates the existing vehicle electrification trend. But I think we could also extend that a little bit out more broadly beyond just autonomous vehicles into the wider world of robotics. Right. Physical AI, autonomy of all kinds of physical systems, like pretty much anything you want to create out there today that's going to be a bunch of GPUs that are disconnected from any kind of cloud-based computing because they have to do tasks in real time. they are probably going to run on electricity

because GPUs run on power and it's going to be inefficient to have a lawnmower engine on a robot or whatever system you have out there that's intended to be operating with very, very low latency in an autonomous fashion. That's true of autonomous vehicles. They're supercomputers on wheels.

That's true of any robotic system out there in the world today. And robots, so robots are probably going to run on batteries if they're mobile robots. So that's yet another source of demand for lots of power-dense batteries. They are going to run on power electronics, doing conversions from direct current battery power to AC power to run a bunch of motors

because robots are also a bunch of collection of high-performance, high-power density, high-efficiency motors. So they're yet another type of equipment that is basically running on this same fundamental tech stack, these same fundamental building blocks, and they're also another source of power demand. So I did some kind of back-of-the-envelope calculations just for fun on humanoid robots. Now, I personally am not crazy bullish on humanoids as like the ultimate best form factor for robots in a lot of applications. But as you and I have talked about a few times, one application

where humanoids might make sense is households, right? Because a household robot, is going to be doing a bunch of different tasks, most likely the kind of tasks that a person does today and the form factor has to fit into a household setting, which is built for people, and you're not going to retrofit your house to fit in some sort of new exotic robotic form factor. So anyway, like just consider a humanoid or something like a humanoid, but in particular consider the power consumption needs of a humanoid robot. And it turns out that if you were to sort of extrapolate from the humanoids that are that are being built today, and you were to run one for five or six hours a day doing various types of tasks around your home and your garden,

sort of, you know, the theoretical robo butler that would consume roughly three to four times as much electricity per year as your typical refrigerator does today. So your humanoid robot would instantly become the biggest power-consuming appliance. in the home save for your HVAC system. It would be maybe a fifth of what a typical electric vehicle driver would be consuming, doing, I don't know, 10,000 miles a year or something like that. So we see this like simultaneously a new vector of demand for all these components and a new vector of demand for electricity supply at the same time. Yeah, I have been obviously curious about that question of like how much electricity

load would a really bullish view on robotics be ad. And my takeaway on that one of the humanoids is like, that's meaningful, but it's not enormous. Like it's not a scary number. If you're three to four times of a refrigerator, that would, and, you know, an aggregate, if we really, everybody ends up with one of these robo butlers, that adds up, but it's not enormous. The thing I wonder about is industrial robotics, where you're going to have some systems that are

much higher power, potentially. and predicting the number of those systems is kind of difficult. But I could imagine that in aggregate load terms for the grid, you end up with much more demand coming from industrial robotics than humanoid's in the home. And I would say industrial robotics combined with industrial electrification in general, because, again, a lot of the more advanced manufacturing processes out there, high-precision manufacturing, making semiconductors, for example,

are already highly electrified processes, because electricity is just sort of the form factor of energy that gets you the kind of precision that you need to run these sorts of things. So I've seen, you know, a large semiconductor fabrication facility, a large chip fab could be tens of megawatts up to like 100 megawatts of power demand, potentially. I think that's sort of the order of magnitude that we're talking about. So, yeah, I think advanced manufacturing, which includes a bunch of robotics within the facility and other processes that are electrically driven, you know, nothing today, the thing about AI-driven demand today and data center demand is like pretty much no matter what, it's, you know, anything you consider that's another vector of power demand growth, it's not going to compare with data centers. Like data centers are just so big that they block out the sun.

But all this stuff on the margins over time compounds, I think. And the other thing, as we were talking about at the beginning of the pod here, is I have very high conviction in all these other sources of electricity demand growth, not just today, but for the next 10, 20, 30, 40 years. You know, data center demand growth may continue to be robust over that time period, in which case we've got a whole other world of considerations on our hands. But I'm much less certain in it beyond the next, say, five-year time period. Yeah, and then also the thing that you said about what electric vehicles did for power electronics in particular,

they scaled up by you sell a large number of units, right? And that really got the silicon carbide supply chain and so on. robots could do a similar thing, right? Robots also could be high volume units, depending on the type. And robots need, as you said, power-dense batteries. So you could see a lot more investment in a certain type of battery that we're not seeing as much on the grid. They need motors. They need actuators.

There's all this other stuff that comes with a scale-up of the robotics supply chain, much of which then could apply back into the electric supply chain in other places, too. So there's like another flywheel that robotics could. kick off, I think, if you really believe that that's coming quickly, which I think I do, actually, not necessarily in humanoid, necessarily, but like broadly. Well, there's one robotic form factor that already, like, we know is coming really quickly and being manufactured in the hundreds of millions, probably getting towards the billions already, which is drones, quadcopter drones, which now, as everyone knows, feature prominently in

defense and in warfare. And defense historically has been a sector that has a high willingness to pay for performance and willing to pay a lot for marginal improvements in performance. So drones are one area we could see, I think, a willingness to pay for further innovation in technology for batteries, for higher density power electronics, right? Which then, again, could have spillover effects for electric vehicles and for all the other stuff we've been talking about. Yeah, as you know, we have been talking with our mutual colleague, Greg Thiel, about the increasing ambitions of the federal government,

initially through ARPA-E and then now through the DOD, to find and discover and commercialize an extremely dense battery. So there was an ARPA-E program a couple years ago that was called 1K. It was supposed to get, you know, I was looking for a thousand-watt-hour per-kilogram battery, which would be, you know, what is that, like 3X, the best on the market today.

Yeah. But I just saw recently, there's a DOD initiative now to try to find a 2,000 watt hour per kilogram battery. And again, these are predominantly, I think, because of drones. Like, that's the main reason you want that. But if you had a 2,000 watt hour

per kilogram battery, and then you apply that into, for example, heavy-duty transportation, complete game changer, right? So if that happens... And the question is always like, who's going to pay for the first thousand and then how are you going to scale it up to the hundreds of millions? And drones are one way you could see that happen.

Like, the military will pay for coming down the cost curve because it's so valuable to have that increase in power density in a drone as a weapon. And then once it's proven out, you could see the unit volume is so high that it's worth

investing in mass manufacturing. That's one pathway you could see some alternative battery technology gain traction when it probably would never do so in the electric vehicle market where honestly like lithium ion batteries we have today are kind of good

enough from a range standpoint. So, like, it would be cool to have a thousand watt hour per kilogram battery, but not at four times the price. Like, I just don't, I think that would not get traction in the EV industry nearly as quickly as in defense. Right. Okay, so to wrap this all up, I mean, we are still in the gauntlet, right? Like, in fact, the gauntlet may have become, like, narrower than it was a couple of years ago. And so I guess if you had to bet on what, what will be the rate limiter. What's the thing that's going to be the hardest to scale up? If the whole premise here is that there's all these feedback loops, all these different things that are all pointing in basically the same direction, which is like increasing demand for electricity over the next decade or something

like that, what's going to stop the market from meeting all that demand? There are a bunch of possibilities here, so you have to pick one. Yeah. So broadly speaking, I think, you know, my view is it's the grid. The grid is the rate limiter. But that's a lot. That's too big picture, right? Because the grid is a big, big system with lots of individual facets. I think, and I believe this for a long time, that within the grid, the thing that is the biggest rate limiter is electric transmission. Because there's no, I have not seen a technology solution that really changes the game for the amount of investment in transmission expansion that we need. and specifically just new transmission lines, new transmission corridors that we need in most regions of the world.

And when you're building a new big transmission line across a long distance and it's high voltage and it's like big infrastructure, big towering structures, you bump up against this sort of societal willingness to pay, willingness to tolerate new infrastructure. You bump up against nimbism for which we have not yet found a technology solution. And so, yeah, that's, to me, the long pole in the tent is electric transmission. And I think we've talked a lot before on an office pod. I know you've had other guests talking about what that means for where some of this new power demand goes. I mean, I'm still hopeful, actually, that we see some AI data center growth go off-grid, not powered entirely by off-grid gas, as some projects have been so far,

but by a hybrid of solar and gas and batteries, which I think could make a whole lot of sense in some places. And if this data center boom continues for longer than the next three to five years, if it's really a robust trend that is going to be decade plus for the foreseeable future, then I don't see any other option besides going to something like large-scale, off-grid connected solutions. All right, that's a good way to wrap it. Off-grid, every conversation ends with, well, why don't we just go off-grid?

So why should this be any different? Andy, thank you, fun as always. Thanks, Shale. Take care. Andy Lubershane is a partner and head of research at EIP with me. This show is a production of Latitude Media. You can head over to Latitude Media.com for links to today's topics. This episode is produced by Max Savage-Levinson, mixing in theme song by Sean Marquan. Anne Bailey edits the video version of the show.

Stephen Lacey is our executive editor. I'm Shail Khan, and this is Catalyst.