Catalyst with Shayle Kann - Heavy duty decarbonization

Episode Date: May 30, 2024

Batteries are making their way into more passenger cars and commercial vehicles than ever before, but the limits of electrification mean that we’ll likely need alternative fuels to decarbonize heavy transport like ships, planes, and trucks.  So what are those fuels and what modes of transport do they suit best? In this episode, Shayle talks to his colleague Andy Lubershane, partner and head of research at Energy Impact Partners. They talk through the limits of electrification and the alternatives for decarbonizing trucks, ships, and planes, drawing on Andy’s recent blog post, “How will we move the big, heavy things?”. They cover topics like: The main limitations of batteries: density and infrastructure Volumetric and gravimetric density, and why they matter for different types of vehicles How fossil fuels would beat out even a theoretical “uber-battery” multiple times denser than current batteries Why upgrading “always-on” grid infrastructure can be lengthy, expensive, and disruptive  The alternatives to electrification: biofuels, hydrogen, and e-fuels The advantages and limitations of each for different modes of transport Recommended Resources: Port of Long Beach: Our Zero Emissions Future Enterprise Mobility: Electrifying Airport Ecosystems by 2050 Could Require Nearly Five Times the Electric Power Currently Used Catalyst: Understanding SAF buyers Utility rates could make or break the energy transition – so how do we do it right? On June 13th, Latitude Media and GridX are hosting a Frontier Forum to examine the imperative of good rate design, and the consequences of getting it wrong. Register here. And make sure to listen to our new podcast, Political Climate – an insider’s view on the most pressing policy questions in energy and climate. Tune in every other Friday for the latest takes from hosts Julia Pyper, Emily Domenech, and Brandon Hurlbut. Available on Apple, Spotify, or wherever you get your podcasts.

Latitude Media, podcast at the frontier of climate technology. I'm Shail Khan, and this is Catalyst. Like lithium ion batteries compared to fossil fuels, they just suck. They're good enough for light and medium duty vehicles, so they don't suck so badly that they've ruled themselves out. But it will quickly become a constraint for certain classes of heavier-duty vehicles. This week, how are we going to move the big things and the heavy things? and the big heavy things.

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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. I'm Shail Khan, invest in revolutionary climate technologies and energy impact partners. Welcome. All right, so this was sort of unintentional, but there's a nice thread through a few of our recent conversations that we've found on this podcast. We had Julio Friedman recently from Carbon Direct who talked about what are we going to do with all the CO2 that we capture. And part of that conversation was well, should we use that CO2 along with hydrogen to turn it into fuels to fuel heavy-duty transportation? Then we talked to Amelia DeLuca from Delta Airlines about sustainable

aviation fuel and what they're purchasing there. And now, today, I'm talking to my partner, Andy Lubershane, who you've heard many times on this podcast before, who has been thinking a little bit bigger picture about, as he calls it, how are we going to move the big, heavy things? So what are going to be the fuels of choice for aviation, for maritime, for heavy-duty ground transportation, and thinking through the puts and takes there of the various options that we've got at our disposal ranging from electrification to those electrofuels and things in between. So we got into everything from the limits to battery energy density and the challenges that'll present in some of these sectors to the role biofuels might play to ultimately what we're

going to have to do to turn over the big hubs where a lot of this transportation is centered. But no further ado, here's Andy. Andy, welcome back. I'm excited to be back again relatively soon. This time to talk about one of my favorite topics. I think we're going to touch on, which we were joking about in the beginning, which is battery swapping. We'll get there. Let's not get ahead of ourselves. I don't want to get straight there. We're going to ease our way into this topic. The broader topic that we're going to talk about today, is how we're going to move, as you said, how will we move the big heavy things?

So let's start with what are the big heavy things that you're talking about here? Most things that we move around are big heavy things, right? So we're talking about everything beyond what I would call like light and medium duty ground transport. And the reason we're talking about everything beyond light and medium duty ground transport

is because we don't really have much of a question of how we're going to move those things in the future anymore, which is a great place to start, right? Like for passenger vehicles, for, you know, medium duty trucks and delivery vans and that sort of thing, maybe even all the way up to like large buses, we sort of have the presumption of electrification at this point, right? Like that's, it's not maybe 100% settled, how we'll decarbonize all of that stuff. But it's about as settled as you get in the realm of, you know, pathways to decarbonization. Right. So we'll talk about everything else, which is generally bigger and heavier.

Yeah, so ships and big trucks and planes and maybe trains and maybe off-road stuff, like all the other stuff we have to move that we have to figure out a way to fuel without fossil fuel, most likely. Okay, and so as we talk about those things, I think it's still worthwhile to start with the presumption of electrification, right? and then sort of knock down the places where you can't electrify. Do you agree with that? And so, why is that a presumption that's like a reasonable place to start? I think that we should presume electrification for transport and should always be asking why not electrify.

Because, you know, frankly, just because of the cost, compared with pretty much all of the other options for, you know, decarbonizing, moving vehicles. vehicles, at this point, electrification looks relatively cost effective. And that's because of a couple different factors. You know, one, it's just because of the kind of the basic cost of the fuel itself, clean electricity, and even clean electricity, given the sort of pressure on electricity costs that we're anticipating that we've talked about on prior podcasts and because of the electricity gauntlet, even as the cost of clean electricity increases over the coming

decade or two or three, I think electricity will still look cost effective as a fuel, like the primary, you know, the energy input relative to things like biofuels or clean hydrogen, perhaps some other alternatives we can talk about, electrofuels, for example. And secondarily, kind of compounding that cost advantage is the efficiency of a battery electric drive train. You know, battery electric drive team can probably get into the realm of sort of 80% efficiency when you're talking about from electricity input into the vehicle to the wheels or, you know, turbine moving of that vehicle, right? And so, and that's just, you know, much higher than any other strategy, even, you know, fuel cell strategies with hydrogen that we know about today. So the operational

cost, the energy cost of moving any vehicle is going to be cheaper with electricity. So you, you sort of have to have a good reason not to use electricity, basically. Right. And so we obviously wouldn't be having this conversation if we thought that the answer was just use electricity everywhere, including all the big heavy things. So let's talk about then how you think about the limits. What are the limits on electrification? What drives the places where electrification actually doesn't become the solution? There's two big constraints on electrification. One is pretty obvious to most people who've thought about this at all, which is energy density of batteries. cost of batteries to some degree, although I think we have increasing confidence that cost of batteries

is not going to be the constraint on basically electrifying any class of vehicle. But density of batteries definitely does matter. Even today, despite pretty good progress we've made on energy density of lithium ion batteries over the past, well, many decades, but especially over the past 10, 15 years, you know, if you look at any chart of either volumetric density, the amount of energy you can store in a given space, or gravimetric density, the amount of energy you can store in a given amount of mass. Like lithium ion batteries compared to fossil fuels, they just suck. I mean, they're really bad at both of those things. They're good enough for light and medium duty vehicles,

so they don't suck so badly that they've ruled themselves out. But it will quickly become a constraint for certain classes of heavier duty vehicles. Let's talk about that in a moment. But the other constraint I want to mention, which I think we'll come back to, is infrastructure. And that's a big one that I think people think less about, but is maybe just as important. Before we get to the infrastructure one, I do want to spend a little more time on that. On the energy density one, I think people know they suck more or less lithium ion batteries relative to fossil fuels. I think we should quantify it a little bit more because the degree to which they suck is probably worth reiterating.

So, you know, from a volumetric energy density basis, a lithium ion battery is like a couple of megajoules per liter, right? That's right. A couple megajoules per liter compared with, let's say, 35-ish megajoules per liter for gasoline and diesel, right? So way, way less energy in any given amount of space. And it's actually, it's worse even for gravimetric energy density because batteries are heavy, even though lithium is the, lightest metal, the third lightest element on the periodic table, they just still weigh a lot on an energy basis relative to fossil fuel. So it's like, in terms of megajoules per kilogram, don't make me do that math in my head, but it's tiny, whereas we're, you know, up in the, you know, 45 to 50 range for gravimetric energy density for fossil fuel. So it's just, they're not even in the same league, really. And that's one thing that's sort of important to remember just in the context of

like when we talk about, oh, we're going to build a battery that's much more energy-dense. And indeed, probably we will, right? Like, energy-density of batteries is going to improve of lithium-ion batteries specifically. But, you know, in our grandest ambitions, I don't think anybody is projecting lithium-ion batteries to ever get anywhere into the ballpark from an energy-density perspective that we have with fossil fuels. Right. I mean, the lithium-ion battery industry at this point is so big. and there's so many engineers working on trying to improve density in any number of ways.

There's dozens and dozens of startup companies and a bunch of different pathways, right? There's silicon anodes. There's solid state batteries. There's sulfur cathodes, yada, yada, yada. And then there's just incremental improvement on existing chemistries that we already know, which is how we've been able to make pretty good progress on density so far. We have so many shots on goal. I think it is reasonably safe to assume that we're going to get at least a 50% improvement

in lithium ion battery density for high performance batteries in the next, let's say, five to ten years. And it's not crazy to assume that we would double density, and it's theoretically possible we could even triple it. Maybe not exactly in that time frame, but if you think about sort of the long arc of battery technology, we could definitely get there. And again, you know, battery technology developers and manufacturers have proven incredibly creative and clever and, you know, are now able to scale things up relatively quickly. The one thing I'll say is that we have reached a point at which it seems like there are tradeoffs, right? So increasing battery density may be possible, but it might come at the cost of increased, you know, cost for the battery or somewhat slower charging speed, right?

it's possible we'll get that Uber battery that's two to three times as dense and costs about the same as lithium ion batteries do today. But I think that we're likely to encounter some of those tradeoffs moving forward. Regardless, we should be assuming density will continue to increase. But, you know, again, keeping in mind that context of how bad it is relative to fossil fuel today, even a two to three times improvement still puts batteries at a huge disadvantage. Right. I'm going to get these numbers slightly off, but so there's an RPE program that's called Propel 1K, and it's this like moonshot program. Can we build a battery that is 1K is 1,000 watt hours per kilogram

and 1,000 watt hours per megajoules? So this is going to be different chemistries. And that's like the moonshot vision. 1,000 watt hours is 3.6 megajoules. That is still on the order of a tenth of what we get right from a false. right? So, yeah, and that's the moonshot. That's the moonshot. And that's the moonshot. Okay.

So I think we've sufficiently made that point. Obviously, energy energy energy is a problem. We'll come back to where that's a particular problem. But you mentioned the other big problem, which is the charging capacity one, which I think is less talked about a little bit, but is obviously directly related to all the things we've talked about before on this podcast of the electricity gauntlet. So, like, as your thinking has evolved on electrification of medium and heavy duty, I guess, heavy and very heavy-duty things,

how much does the charging constraint come into play for you? I think it's a really big constraint. I mean, I think there are some areas where it's a much bigger constraint than battery density. Pretty much everything on the ground, I actually think, including the heaviest duty, at least road trucks, perhaps not like big mining vehicles and other big off-road vehicles. But even Class 8 semi-trucks, I think,

have a plausible pathway to maybe not, 100% electrification, but pretty high levels of electrification over the coming decades. But that's an area where in some places, despite the fact that you can achieve sort of technical viability and economic viability at the vehicle level with a battery electric drive train, if you have enough vehicles that all have to come together to fuel in a relatively concentrated area, we're talking about just enormous amounts of power. So the sort of canonical example, I think at this point, is ports. So the example I know best because they've put out actually a good amount of data on it is the port of Long Beach in California, which is basically right next to the port of Los Angeles.

Together, they sort of make up the largest port in the United States. And so if you just take Long Beach sort of half of that combined port infrastructure, there's the port itself put out a study on the, this topic. And they have about 1,600 trucks. They're called Dreyage trucks that serve that port. And they're basically going in and out of the port every day, picking up cargo and moving it to, you know, to locations that are just outside the port where it's picked up by other trucks, where it's moved all across the country. Which, by the way, makes them perfect for electrification, right? Like, if you're going to electrify heavy-duty trucks, draage trucks are the way to go, because they don't go long distances. They make a lot of short trips. That's right.

So from a density standpoint, you know, battery density should not be a constraint for those types of trucks. And actually, the economic value proposition should be really high because there's lots of start and stop operations, which batteries and electric vehicles in general are really good at, right? But infrastructure becomes a concern because if you're going to charge those 1,600 drudge trucks, you know, in and around the port, somewhere within 50 miles of the port, for example, which is where they generally tend to go. And even if you were to charge them overnight at 100 kilowatts each, so kind of slow charging overnight, you still have 1.6 gigawatts of new peak demand sort of in and around that port. And in this interesting study, the port itself put out, if you look at the existing substation infrastructure, electrical substation infrastructure in that region, that would be adding 90 megawatts to every substation if you had to sort of use the existing footprint of those substations for

charging, which is just completely infeasible, right? So we're talking about adding, you know, multiple transmission lines worth of new power, feeding the port in one of the densest operational environments you can possibly imagine. And, you know, again, it's possible we could eventually get there, but that's just not the sort of thing you can do overnight. That's not the sort of thing you can do in 10, 15, maybe 20 years without lots of additional expense and disruption. So that's just one port, one half of this port in California. That's just slow charging the drainage trucks, right? You could want to fast charge them.

You could also add the trucks that go in and out of the port that are not draged trucks. To truly electrify the entirety of the port would be a massive undertaking from a grid infrastructure perspective. That's right. So, you know, again, Port of Long Beach is a good example just because they've thought a lot about this and put out a lot of public material on it. And back in 2011, that port started out on this 10-year effort to electrify all the cargo handling equipment and also to provide what's called shore power to ships that are basically parked at the port at one of its major cargo terminals. and they have seven major cargo terminals at this port. And it was basically that project alone,

just for cargo handling equipment and shore power, that took 10 years and required the utility, Southern California Edison, to build a new 66 kilowolte-kilovolt transmission line and four new substations into the port area. So it just gives you a sense of the kind of infrastructure challenge we're up against. So, you know, reports are, in my mind, because of that, an interesting example of where you can theoretically

electrify the vehicles, but it might make more sense to use a different approach. Okay, so we've identified these sort of like two challenges for full-scale electrification everywhere, one being the density and the other being the charging infrastructure. You just break down of the different categories of big, heavy things that we move or the ways that we move them. Like, where is density the constraint versus where is charging the constraint? The area that density is most obviously a problem is in aviation. Because from the very beginnings of human flight, right, we've been fighting a war against gravity and against weight and trying to take weight out of the vehicle as much as possible. And, you know, that's important just for the viability

of flying a plane in the sky. It's also really important for the economics, because as you add more and more weight to the vehicle and or as you take up more space in a plane with fuel, with the battery in this case. It means that you can't carry as much stuff. You can't carry as much people. You need more energy just to move it over the same distance, right? And so I think most people who've taken a serious look at aviation and even considering major step changes in battery density. Let's say a three times improvement in density from where we are today. There's just a vanishingly small share of total flight miles that can be cost-effectively electrified. And by the way, infrastructure would be an enormous problem as well for getting the amount of power that you

would need to fly airplanes any amount of distance into an airport. So I effectively rule out aviation almost entirely from electrification, both because of density and because of infrastructure. There's probably a few small airports, very small short hop aircraft that it could make sense for, but they're pretty meaningless in terms of kind of total aviation emissions. The other place that density is a real problem is for shipping. It's not as much of a no-go as it is for aviation.

And in this case, it's more about volumetric density than about gravimetric, right? We don't care so much how heavy the batteries are, but they take up too much space. That's right. I mean, gravimetric density affects the economics of fueling, because you have to push more weight through the ocean. But the amount of space that the battery takes up

is really what's a killer, because that affects the economics of how much cargo you can carry and how much you can get paid for. And then, you know, given what we were just talking about in the context of electrification of ground transport at ports, You can only imagine what kind of additional electric infrastructure would be required to power, you know, large cargo ships at a port and not just providing shore power while they're parked, but actually giving them enough energy to make a journey across the ocean. It's just not practically feasible. So, again, except for pretty small ships and, you know, some ferries in certain instances that don't really account for a large share of global.

shipping emissions, I've pretty much ruled out electrification and shipping as well. 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 energy hub.com. 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 isn't shaped 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. All right, before we move on from electrification, then, let's get to your favorite topic. The topic upon which you have gotten very excited multiple times over the many years we've now worked together, despite I think much of the world having been burned by this topic, in the 2000s by a company called Better Place, which is battery swapping. Talk to me about why you like battery swapping.

It's true. I am a sucker for battery swapping. I don't know why. I think it's just that the idea has such enormous elegance because it solves a bunch of problems at the same time, particularly now for bigger, heavier vehicles. One problem it solves is it partially addresses the issue of battery density and sort of range limitations for heavy-duty vehicles. So I'm going to talk mostly about heavy-duty trucking in this context at this point, which is where I think battery swapping or variance on battery swapping could make the most sense. You know, it's because these vehicles, when you add significant weight in a battery, right, if you add enough of, if you add enough battery capacity to make those vehicles, in many cases, go as far as

they need to go and carry as much cargo as they need to carry, you're adding so much weight to the vehicle that it limits the range of the vehicle. And in some cases, it limits the amount of cargo that vehicle can carry. And so adding a smaller battery that could be swapped in and out improves the economics of the overall endeavor in that respect. It also means that the truck can be can be effectively refueled much more quickly, right? You know, today a truck driver pulls into, you know, a refueling station, a truck stop, they can within a couple minutes if they have to, you know, pull up to a diesel pump and refuel the vehicle and be on the road again, right?

That's just not going to be the case with batteries, right? Where you need optimistically, again, maybe 15 to 30 minutes at best to charge a battery, safely given kind of current battery technology and where we see things going. And so in order to really get as close as possible to kind of approximating the operational profile, the experience of driving these kinds of trucks today, battery swapping lets you theoretically refuel by swapping a battery in and out almost as quickly as you can fuel up with diesel today, which also improves the economics because you have more time on the road and less time spent charging. And then it also helps address the infrastructure

problem, right? Because a battery that swapped out of a vehicle, instead of needing to be charged in 15 to 30 minutes, which, you know, for potentially we're talking about like a two megawatt hour battery that would be required in some of these semi-trucks in order to get any reasonable distance, you know, we're talking, if you have to charge that in 15 minutes, that's 8 megawatts of charging capacity, which is insane. I mean, we don't have chargers that can do that today. And even if we develop them, the amount of grid capacity required for multiple trucks to be charging that quickly all at once is just bonkers, right? Again, that's going to put a damper on the pace of electrification that's feasible.

But if you can swap a battery out and charge it slowly over a longer period of time, especially as the cost of the battery itself falls so that utilizing that battery is not, you know, at high, utilization levels is not so important. I think that could make a lot of sense. So I love the elegance of battery swapping. There's a company called Revoi that I'm pretty enamored with that listeners should go check out that has a really clever take on battery swapping for semi-trucks. I'll say in general for the category of heavy-duty trucks, battery swapping, I think, belongs in a broader category, which I would call partial electrification, right? there's lots of things you could do potentially with a truck to make it partially electrified that get significant carbon savings benefits, potentially some economic benefits, set you on a path,

a long-term path to electrification of that sector, but don't try to go, you know, fully electrify a vehicle up front. So there's another company called Range that has an electrified trailer that, you know, would not be looking to fully electrify all the miles that a vehicle is doing today, but is probably a much more cost-effective way than a fully electrified semi-trailer that would be doing the same and gets you started. So I really like those approaches. And I think that's probably the right pathway for decarbonizing a lot of ground transport, heavy-duty ground transport via electrification. All right. So you've made your case about battery swapping, which I think is compelling, the challenges we've, we're yet to see anyone actually succeed at it at scale. Outside China,

where I should say actually there's a lot of battery swapping going on. Surprisingly enough, Neo has a big battery swapping network in China. So interesting to consider what's different there versus everywhere else. They just appreciate elegance more in China, apparently. Perhaps that's it. Perhaps that's it. Okay, in the meantime, let's move on from electrification. I think we've sufficiently explained the challenges of full electrification of everything. Let's talk about what the alternatives are for moving these big, heavy things. What do you think of as being the sort of primary, first thing everybody's going to talk about here? Well, the first thing everyone's talking about now is probably hydrogen.

But I think the first thing we should be talking about is the biggest source of lower carbon transport fuel that we already use in the transportation industry, which is biofuels. The biofuels are really interesting, right? They already, you know, we already use a bunch of it, both in terms of ethanol derived from corn starch, as well as biodiesel derived from soy, which, you know, today corn ethanol makes up about 10%, basically by law, makes up 10% of the fuel that goes into gasoline. but the problem with biofuels ultimately is that it's such a limited supply. We already use about 40% of the total U.S. corn crop today for making ethanol, for blending into gasoline. We're now approaching about 30% of soy that's used to produce biodiesel. And so, you know, there's a limited amount of those kinds of basically food biomass resources that we can convert into fuel.

And we're probably already tapped out, frankly, on those. And then there's the additional problem, which is that the life cycle assessment of the fuel produced with those types of biomass resources just doesn't come out all that favorably for biofuels relative to fossil fuel. I mean, if you look at most studies, there is an advantage, you know, probably somewhere in the 25 to 40 percent carbon intensity benefit range relative to fossil fuels. relative to fossil fuel, but that just raises the question of, is it worth it to go through all this trouble of using so much corn and soybeans, which could otherwise be used as food crops to produce

fuel? So the question is for biofuels, can we move on to second generation feedstocks, these cellulosic feedstocks, which are more abundant, tend to have a much better carbon intensity benefit relative to fossil fuel, but are still limited. And I think that's the second, I think that's actually the first thing that the transport market should be going after is second generation biofuels that can start to make a difference for emissions of certain classes of heavy duty vehicles, even though there's just still not enough of that biomass feedstock to solve the whole problem. I think the place that we see that happening the most now is clearly in aviation, like all the sustainable aviation fuel today is biomass derived.

and to a lesser extent, we're starting to see some biomethanol in shipping. But is your view that that next step should be bio-based feed stocks for all these categories, including, for example, heavy-duty ground transport? Yeah, I mean, to some degree, I think, let the market decide. And right now it's the aviation, it's the airlines that are willing to pay the most for sustainable fuel derived from biomass. And I think because of a bunch of different factors, that's probably going to be the case for quite a while going forward. And, you know, the challenge, though, is even if you assume we unlock new methods of producing second generation biofuels.

So, you know, we recently announced an investment at energy impact partners in a company called TerraGeo, which can use cellulosic woody biomass feedstock to produce ethanol. we think much more cost effectively than kind of any approach that's come before. You know, that's great. And that could make a real difference over time for the sustainable aviation fuel market. It's a great way to get started. But, you know, even kind of optimistically, if you were to max out that resource globally and all of it were to go into the aviation fuel market, especially given the growth we're expecting to see in demand for aviation fuel, we're still talking about probably solving about

half the problem of the of the aviation industry. And that's not really touching any of the other big heavy duty vehicles out there. So, you know, biofuels are a great start if we can unlock these second generation resources. But, but they're not the whole picture for sure. Okay. So we've talked electrification. We've talked biofuels. Now let's talk about hydrogen and I guess hydrogen derivatives. How do you think about those in the context of moving big, heavy things? You know, if you think about the path to decarbonization as electrify what we can, and then as I mentioned, I think the next step is probably trying to fill in more of the gaps with second generation biofuels. I think of hydrogen and derivatives of hydrogen as step three, because there is still going to be a big gap in particularly the heaviest duty transport segments like aviation and shipping beyond that.

And, you know, hydrogen is a really interesting energy character. It's actually better when it comes to gravimetric energy density than fossil fuels. Hydrogen is even lighter than hydrocarbons, but it is worse in terms of volumetric energy density. So it's actually, it's still a little bit better than batteries. It takes up a little bit less space per a jewel than a battery does, but not that much better. We're talking about, you know, maybe two times for compressed hydrogen, maybe up to three times for liquid hydrogen relative to the volumetric density of. lithium ion batteries. And so from a pure vehicle viability standpoint, the challenge with hydrogen is that it does still require pretty significant redesign of a vehicle in order to make it work. And we'll take up more space within a vehicle than fossil fuel does today. So, you know, that means in aviation you have to have a bigger plane that more of the plane's volume is consumed with hydrogen and the same thing possibly with a ship. Now, I don't think that necessarily rules out pure hydrogen as the fuel for those vehicles, but I think most likely we'll want to do

better than that. And so that means taking hydrogen as an energy carrier and upgrading it into more energy dense and easier to handle molecules. You know, you mentioned methanol. That's one option. That takes a carbon atom to do. And so in order to upgrade hydrogen into methanol with a carbon neutral footprint, you have to get that carbon from, probably from captured carbon and probably from ultimately from direct air capture. And that's going to be true of all of this breed of so-called electrofuels that are basically taking clean hydrogen and adding some number of carbon atoms to it to make some sort of synthetic hydrocarbon. The benefit of that strategy is that ultimately you can produce molecules that are drop-in replacements for current fossil fuels, right? You can

produce synthetic jet fuel that is basically exactly the same as current jet fuel. You can produce shipping fuel that's exactly the same as shipping fuel. But it's the most expensive strategy because you both have to make clean hydrogen, which we don't have time to get into on this. podcast, I know you have on others, and you have to capture carbon from the atmosphere to add to that hydrogen to upgrade into hydrocarbons. And then you have to run a process to create the synthetic jet fuel using your hydrogen and your CO2, which adds more cost and energy expense. But, you know, ultimately the question is, how much is it worth going through that entire rigamarole in order to end up with a fuel where you don't have to change anything in terms of the vehicle or

or the hub infrastructure that we're dealing with, the port infrastructure or the airport infrastructure. And I think, you know, the more I've thought about this problem, the more I think if you take decarbonization really seriously, then most likely that is the biggest constraint upgrading those really expensive heavy-duty vehicles, long-lived vehicles and long-lived hub infrastructure. And probably it does make sense to find, even a very expensive fuel, to avoid going through all of that challenge.

Yeah, you know, you've made this point, which has ultimately resonated with me around paying attention to the hubs in the context of heavy-duty transportation. And I think it's true of all types of heavy-duty transportation. We talked about drainage trucks at the port of Long Beach, but you could say truck stops in general, our big hubs, obviously ports for maritime

and airports for aviation. So these are sectors wherein they are more hub-based, and that creates an opportunity in the sense that you have these centralized places where if you fix it there, you've kind of fixed it for most of the market. But on the other hand, it raises exactly the problems you described before of, like, changing over the infrastructure at a hub is a much, much bigger challenge than changing over infrastructure, little piece by little piece, for example, adding electric features. cargers to our homes. So it's a whole different ballgame in the hub context. And that does, I think, ultimately affect what's going to win out here if we do indeed decarbonize because of the both opportunity and challenge presented by the hub-based nature of these markets. Yeah, I completely agree. I mean, I think anyone who is thinking hard about decarbonizing planes or ships or trucks, you know, the next time you're at a truck stop or a port, I know most people are in a

at big commercial ports all that often. But many people are at airports very frequently. Like, stop and pay attention to everything going on around you and consider what it would really take to substantially change the infrastructure in that really complicated operation that has to be ongoing, right? It can't be interrupted. I've been flying in and out of LaGuardia Airport, for example, for the past seven years, actually, since I joined energy impact partners

and I live up in Maine. and LaGuardia has gone through this big construction project over that time frame. And I feel like in order to upgrade LaGuardia to electrify or to add hydrogen fueling in some capacity, the amount of disruption would be 10 to 100 times what I saw at LaGuardia during the past seven years as they upgraded a terminal to be just a little bit nicer. So, yeah, pay attention to the hubs. All right, Andy, fun as always to talk through yet another facet of deep decarbonization. Lots of threads to pull on here, so I'm sure it won't be long until we do it again.

Thanks again, though, in the meantime. Yeah, thanks. Andy Lubreshane is my partner and head of research at Energy Impact Partners. This show is a production of Latitude Media. You can head over to Latitude Media.com for links to today's topics. Latitude is supported by Prelude Ventures. Prelude Backs Visionaries, Accelerating, Climate, innovation that will reshape the global economy for the betterment of people and planet.

Learn more at preludeventures.com. This episode was produced by Daniel Waldorf, mixing by Roy Campanella and Sean Marquan, theme song by Sean Markwan. I'm Shail Khan, and this is Catalyst.