This Week in Startups - Texas energy grid challenges and solutions with Base Power’s Justin Lopas | E1960

Episode Date: June 6, 2024

This Week in Startups is brought to you by… OpenPhone. Create business phone numbers for you and your team that work through an app on your smartphone or desktop. TWiST listeners can get an extra 20% off any plan for your first 6 months at https://www.openphone.com/twist⁠ Squarespace. Turn your idea into a new website! Go to http://www.Squarespace.com/TWIST for a free trial. When you’re ready to launch, use offer code TWIST to save 10% off your first purchase of a website or domain. Lemon.io - Hire pre-vetted remote developers, get 15% off your first 4 weeks of developer time at https://Lemon.io/twist Todays show: Base Power’s Justin Lopas joins Jason to discuss the critical link between energy availability and GDP per capita, focusing on Texas' deregulated energy market and recent power outages (2:16). They also dive into ERCOT's role (7:40), dynamic grid pricing (20:04), batteries' potential for grid resilience (23:09), and more! * Timestamps: (0:00) Base Power’s Justin Lopas joins Jason (2:16) Discussion on Texas energy grid and recent power outages (5:34) Deregulated energy market in Texas (7:40) How the Texas grid works and the role of ERCOT (9:35) OpenPhone - Get 20% off your first six months at https://www.openphone.com/twist⁠ (10:50) Issues with the Texas energy system, power outages, and comparison with California's energy issues (20:04) Dynamic grid pricing in Texas (23:08) ERCOT's procedures during overload conditions and the role of batteries in grid resilience (25:39) Squarespace - Use offer code TWIST to save 10% off your first purchase of a website or domain at http://www.Squarespace.com/TWIST (30:40) Cost comparison with Tesla Powerwalls (36:09) Lemon.io - Get 15% off your first 4 weeks of developer time at https://Lemon.io/twist (45:12) Current deployment status, operational challenges, and regulatory challenges in the energy market (50:32) Proposal for trusted vendor programs and preferred vendor status (1:03:41) Correlation between energy availability and GDP per capita (1:04:19) Solving the energy problem to boost human prosperity * Subscribe to This Week in Startups on Apple: https://rb.gy/v19fcp * Check out Base Power: https://www.basepowercompany.com * Follow Justin: X: https://x.com/JLopas LinkedIn: https://www.linkedin.com/in/justinlopas * Follow Jason: X: https://twitter.com/Jason LinkedIn: https://www.linkedin.com/in/jasoncalacanis * Thank you to our partners: (9:35) OpenPhone - Get 20% off your first six months at https://www.openphone.com/twist⁠ (25:39) Squarespace - Use offer code TWIST to save 10% off your first purchase of a website or domain at http://www.Squarespace.com/TWIST (36:09) Lemon.io - Get 15% off your first 4 weeks of developer time at https://Lemon.io/twist * Great 2023 interviews: Steve Huffman, Brian Chesky, Aaron Levie, Sophia Amoruso, Reid Hoffman, Frank Slootman, Billy McFarland * Check out Jason’s suite of newsletters: https://substack.com/@calacanis * Follow TWiST: Substack: https://twistartups.substack.com Twitter: https://twitter.com/TWiStartups YouTube: https://www.youtube.com/thisweekin Instagram: https://www.instagram.com/thisweekinstartups TikTok: https://www.tiktok.com/@thisweekinstartups * Subscribe to the Founder University Podcast: https://www.founder.university/podcast

Yeah, Jason, I think if you look over time, over the history, energy use has just gone up, right? And if you also look, there's a really interesting chart online that I'm happy to share, but is of GDP per capita of a country versus its energy availability, how much energy it has. And what you'll find is there's a direct correlation between these two. More energy, higher GDP per capita. This is really the sort of fundamental thing here is how do we increase the availability of energy such that we can increase human prosperity? I think that's, it's fundamental to so many industries. Obviously, the recent advances in AI, but transportation, agriculture, manufacturing, my background, it's all, it's all sort of derivative of energy.

And if we can solve the energy problem, we can build a lot more really cool stuff. This Weekend Startups is brought to you by Open Phone. Create business phone numbers for you and your team that work through an app on your smartphone or desktop. Twist listeners can get an extra 20% off any plan for your first six months at openphone.com slash twist. Squarespace. Turn your idea into a new website. Go to Squarespace.com slash twist for a free trial. When you're ready to launch, use offer code twist to save 10% off your first purchase of a website or domain.

And lemon. hire pre-vetted remote developers. Get 15% off your first four weeks of developer time at lemon.io slash twist. All right, everybody, welcome back to this week in startups. Today we're going to talk about a startup that wants to put a battery in every home, making power outages a thing of the past. And this doesn't require you to install solar panels on your roof. Justin Lopas is the co-founder and C-O of base power.

And they're making sure that when the grade goes down, your power doesn't. Justin, welcome to the show. Hey, Jason. Thanks a bunch for having me. Really appreciate it. My friend, Bestie, Brad Gersner, had told me about your startup. You're based in Texas, yeah. That's right, Austin.

In Austin, just one of my favorite cities of all time. And you've raised a bunch of money. I see you did a $68 million Series A. My friend Antonio from Valor Equity Partners is involved. Altimiter, as I mentioned, Brad Gersner is involved. in Texas, we have been seeing over and over and over again that the grid fails. So maybe you could tell me a little bit about how your solution works, who pays for the batteries, and then what impact that'll have in a place like Texas where we keep seeing these weird,

I guess you guys have had like, I don't know if it's snow or just frost or really cold temperatures and all the cables break? Is that what's actually happening there? like the wind here in California is knocking down poles and then people just turn off the electricity. The electric company just turns it off because they don't want to start fires. Tell me about what's going on in Texas and then how this all works. Yeah, Jason. So, yeah, it's a really interesting time to be in the Texas energy ecosystem.

I don't know if you've followed recently. This is just a few days ago, but actually a big storm came through Houston that knocked out power for actually over a million people at the peak. most of which in the Houston area, this is like one in 13, one in 14 electric customers in the state didn't have power at a time. So this is really timely. To your exact point, the Texas grid is a really interesting place. It is actually a grid that is islanded to the state. So there are three grids in the U.S. There's the western, there's the eastern, basically split roughly by the Rockies, and then there's Texas.

And Texas is actually its own physical grid, sort of like Hawaii is where it's a, electrical island. And so all of the energy that is consumed in the state needs to be generated in the state and vice versa. And the challenge of the Texas grid is facing is not only just weather, like what we saw in Houston over the last few days, or you're referencing winter storms of the past a handful of years that have knocked out power. But it's also, it is becoming a imperative for the Texas grid to be able to take on the increasing volatility of supply for, renewable generation. So the Texas grid is an island, like I said, and it also has the most renewables on the grid compared to any other state. So there's a ton of solar and a ton of wind

here in Texas. How did Texas become the leader in renewable energy? That's kind of a strange thing. We should pause on there for a second because you would think in oil country, you'd be burning oil. But in the great state of Texas, you are leading in renewables. And maybe you can just tell us a little bit about the ascension of solar and wind in Texas. So there's kind of two things that are happening to confluence a lot of renewable generation here in Texas. There's this concept of the wind corridor, kind of the center of the U.S. And then there's the sunbelt, right, which is the southern part of this of, kind of the southern belt of states. and Texas is in both of those locations, right?

So there's a ton of solar ability for solar to be installed in the west part of the state and a lot of wind in the southern part of the state. And Texas, not only is its own grid, but it's also a heavily deregulated energy market, which I'd love to spend some time on with you, Jason, and kind of how that works. But what that essentially means is that there's a much easier and faster and more free market approach to generation coming online. And so there's basically a split between those that generate the electricity and those that deliver the electricity, which doesn't happen in other states. For the most part, like where you're at in Northern California, you have PG&E that owns the whole, kind of the whole stack. Here in Texas, the stack is split up by regulation. And so that allows more sort of free market principles, aka renewables, which are typically cheaper than coal and natural gas to come on onto the grid. And that's another moment to pause here.

As incredible as at seems, building a new solar farm, I guess farm installation, I don't know what we call them these days. Solar farm, yeah. Yeah, building a solar farm, my understanding for my friend Phil Doge is that building one of these solar farms is cheaper now than forget about building a coal plant. Even like refreshing a coal plant and, you know, maintaining it is now becoming more expensive than just installing solar. This is true, yeah? Totally true. And, you know, it's funny, renewables used to be, there used to be a green premium associated with renewables, right? It would cost more to have cleaner generation or consumption. The EV would cost more than the gas car, etc. That is really no longer the case, especially on the grid. And so you'll see a lot of the, you know, you're referencing kind of Texas oil country. You'll see a lot of the oil and gas companies and folks in that ecosystem are actually investing in and participating in renewable generation. just because it's simply cheaper and more economical. And they know the business.

It's like the business of selling energy is complex, even in a place that's deregulated. So if a person wants to build a solar farm and then sell that energy, they can connect to the grid. The grid is controlled by somebody, some authority that then allows people to add supply to it. Is that correct? Yeah, that's right. So let's talk a little bit about kind of how the Texas grid works. right. So there's a nonprofit entity called Urquat that's the Electric Reliability Council of Texas. And they are responsible for managing the grid. They don't own generation. They don't own poles and

wires. And they can't sell you electricity. But they're responsible for kind of calling the shots. They've got a control center that looks sort of like a NASA emission control, so to speak. And those guys who are operating the grid. And they're also operating this marketplace. You can kind of think about them as the New York Stock Exchange of Energy here in Texas. So if I have a solar panel or if I have a battery like we have, and I want to bid that energy into the market, I go through ERCOT and ERCOT matches me with a buyer. And so they basically do all the financial settlements. So ERCOT manages it. And then there are three kind of distinct areas of ownership throughout the grid.

So there's those that generate the power. There's those that own the poles and wires, like the things that you see, transformers or substations. And then there's those that sell the power. And so we at base power are one of those that sells the power. And we also, through our batteries, kind of have a generation source, right? Because when they're discharging, we're generating power that's either supplying the home in the event of an outage or in a high-priced environment or we're pushing back onto the grid. And the way that Texas has set up its energy market is those that own the poles and wires, those guys are a sort of regulated monopoly. So there's a company that owns the Texas, the Houston area of the grid.

a company that owns kind of from Austin to Fort Worth, Dallas area. Those guys are regulated and they legally cannot own assets that generate electricity and they can't sell electricity to customers. Okay, so they're the carrier, but they don't get to participate in the buy-sell side. Exactly. They just are a carrier. So they're like the railroads. They don't get to be the factory where the distribution center.

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So what you're saying sounds like a logical, efficient system, yet I hear people complaining constantly about electricity in Texas. So what am I missing here? Why is there a disjoint between what seems like a, I don't want to say a perfect marketplace, but a functional marketplace? What's the issue here? Why is the system failing so much? And why do people complain about it so much? Yeah. So Texas, unfortunately, is one of the leaders in the nation on power outages, right?

And this is a confluence of a few factors. One is that the renewable supply is the highest in Texas, as we discussed, right? And so when the sun isn't shining and the wind isn't blowing, you have to have an alternative source of energy. And so that's where we come in with batteries. But that is one area where I think the market has not moved quite fast enough, all those moving fast with companies like us coming into the market to add batteries to sort of fill in those gaps over time. The other item is just that there's a lot of,

there's a lot of natural disasters and storms like the one we had in Houston a few days ago. So extreme weather has always existed in Texas. That's right. And so that is table stakes. That's right. That's right. And I think like, you know, the grid itself, like the middle part, the poles and wires, have not really been upgraded nearly as fast as the growth in both population and what they call load growth. Basically, people getting EVs.

So they weren't charging a car. Now they are. That's a huge strain on the system. This phenomenon is not just a Texas thing. Texas gets a lot of has a lot of people and gets a lot of press over this. But this phenomenon happens happens elsewhere, right? I mean, we're having it in California constantly. Totally.

And the amount of times the peninsula where I live in the Bay Area or Tahoe goes down is just dozen times, maybe a half dozen times a year. And, you know, sometimes it's for four days, five days. I had to move into a hotel because we didn't have power for that many days. Yeah. It was the longest ever, it was five days recently. Yeah. Yeah.

And so this problem is not just a Texas-centric problem, although it is exacerbated by the conditions I was just mentioning here in Texas. one other interesting point, Jason, that might be interesting to talk about here is in here. I'll share my screen. Right. Is if you look at energy prices here in Texas, what you'll find, and this is a chart from 2010 to 2020, hopefully you're seeing that. Yeah. What you'll see is a pretty reliable trend that is the following.

So if you're looking, if you're not watching on video, basically this is a stacked bar chart. 10 years from 2010 to 2020. And the top of the bars are roughly the same. They're at 10 cents per kilowatt hour. Units aren't really relevant for this discussion, but it's 10, you know, 10 cents for every kilowatt hour that you use. And that's remained consistent for over a decade. That's right. That's remained consistent for for over a decade. The makeup of that cost, though, is changing quite dramatically. So what you see on this graph and the yellow bars here is the delivery costs. So this is the cost for the poles and wires, basically to pay the rails, to use your analogy from earlier, to get that energy to you.

Whereas, so those costs have increased. From about 25% to 40% it looks like. That's right. That's right. And the cost to produce the power, this is the prior comment about wind and solar, just being, frankly, more affordable way to generate power, that cost is shrinking over time. That was about 70% it looks like, and it's now down to maybe 50%. That's right. That's right. Once you install the solar panels, I mean, this maybe sounds obvious. Once you install the solar panels, there's like not much ongoing costs. If you have a coal plant or an after gas plant, you have to pay for the fuel to generate the electricity. And so what we're here to do is reduce those yellow bars, reduce the delivery costs by adding batteries to the grid that reduce the strain on the grid during peak times.

Got it. And so that is good for the consumer. And you have a, you know, sort of, tragedy of the commons, you know, the delivery costs and that infrastructure is like a well that the town all gets their water from. You know, somebody, you know, you have to basically protect it. I want to get graphic here. That's right. That's right. For every person who puts in solar and a battery pack or just a battery pack, the strain goes down. Therefore, and that person's delivery cost goes down, and that person, I guess, becomes potentially part of delivering power to their neighbors. That's right.

The way the analogy that I like to use here, Jason, is let's imagine that you and I are both standing on opposite ends of a lake. I have a cup of water. You have an empty cup. I pour my water into the lake. You use your empty cup. We pick up water. It's not like you didn't get my water, right?

You got water. You got water. But it's like my water contributed to the level of the lake. Got it. Right. And that's kind of the way to think about how the batteries contribute. The other important point I think that's worth, worth knowing, Jason, is when we add solar onto the grid, solar, you know, stated in the obvious here, only produces during, you know, 8 a.m. and kind of 6, 7 p.m., right? And so you have this phenomenon that happens called the duck curve.

And folks can look this up. I don't have a visual quite handy. This is really prevalent in California and it's starting to become prevalent in Texas. the curve is shaped like a duck, and the belly of the duck, the middle of the day, is when you have a lot of solar and not a lot of demand. And then everyone comes home from work, turns on their oven, plugs in their EV, turns on air conditioning, as the sun is setting. And so you have this sort of compounding effect of increasing demand during the short period of time

and decreasing supply. This is obviously bad for prices. And this is really where batteries come in. So we are charging at the middle of the day when there's that excess solar, right? for relatively low cost because there's extra solar. The solar operators would have just unplugged their panels from the grid anyways. Yeah, exactly, exactly. There's the duck.

There's the duck. And you see at 6pm, everybody gets home. That's the peak. That's the head of the duck. And then the duck's bill goes down and duck's looking down. And it goes down throughout the night. I guess you probably have your air conditioning on, whatever. And then during the day, you know, somewhere at a time around 6, 7, 8 a.m.,

you leave the house. hopefully you're not leaving your air conditioning down. So all these giant homes in Texas, everything's big in Texas, you get these big footprint homes, people turn off their air conditioning during the day. It goes way down and they're not using their washing machine. They're not using their oven. They're just using the steady state stuff, right?

And so, yeah. That's right. And so what batteries do is at the bottom of that, the duck's belly, they're soaking up that excess energy that would have just not gone anywhere, right? And then at the beak of the duck, at the peak, around 6 p.m., they're discharging to reduce the cost on the system. So the entire grid is sized for peak demand for that 6 p.m. time on August 15th here in Texas when it's 115 degrees out. The entire system needs to be sized for that. But the rest of the year, it is, you know, definitionally not as strained.

And so if you can reduce that peak, you now can have increased growth. of both load, so people coming into the state, people getting EVs, etc., as well as increased renewable generation by virtue of having batteries on the grid. It's almost the perfect system because you need to batteries let you, you know, basically shift time, right? You're shifting time of when this stuff gets used and you want to shift it to the time when it's most expensive and most in demand. And it just happens to be that I guess are migraising.

patterns as humans is to leave our homes, go to an office, go to work, go to school, and then pee, when the sun goes down. It's actually kind of brilliant, but batteries are, in fact, expensive. And I'm curious if, you know, a place like Texas can really take advantage of this because of specifically air conditioning, right? If it wasn't for air conditioning, this would not be as an acute of an issue. Am I correct? Yeah, air conditioning is a decent part of the load. EVs are sort of adding to that, though. Like imagine that as energy consumption at the end use goes from natural gas for your stove

and gasoline or diesel for your car changes into electricity, you're sort of displacing a lot of fossil fuels with electricity. So even if energy usage in total doesn't necessarily go up, its shift goes from fossil fuels more to electricity. at the end. And so does the grid charge dynamically? So the 6-10-9 p.m. window is more expensive than other times? Yes, it does. And this is in particular something that's really interesting here in Texas. And I want to show you another chart here.

So this is what I'm going to share here is from ERCOT. Remember, this is the Electric Reliability Council of Texas. These are the guys that operate the New York Stock Exchange of Texas Energy. So this is just today. We're looking at this totally live. Today is actually a pretty good indication. And so what you'll see on this graph is the x-axis here is kind of the whole day, so midnight to midnight. And then the y-axis is price.

And so this is the price that you pay for that 15-minute interval, the price changes every 15 minutes here in Texas, for energy. And what you'll see today is like an interesting day. It's not super hot. But you can see that supply and demand dictate a increasing price here. And if you look at what the, this is this dotted line right here is the day ahead market. So this is what people thought the prices were going to be for today yesterday. So they submitted a day ahead price. And they got it's $87 from $7 this morning.

I mean, so it goes, it went up 12x or so. That's right. In the same day. So if a person were to load their battery from the grid, just doing that. If you load your battery between 1 a.m. or 2 a.m. and 6 a.m. or 5 a.m. seems like the proper time to load your battery up. Yeah. And then you deploy it during that period. You paid 7. You paid 8% or something like that for your electricity compared to your name. You save 90%. That's right. And prices, again, in a sort of free market here are reflective of supply and demand. Right. So if we go back here and honestly, anybody who's interested in this, I'd strongly encourage you. like, I'm a big nerd about this, so I have this open all the time, but like, I think it's pretty interesting.

If you look here. Ercot is ERCOT and the website is urcot.com. That's right. And so prices are driven by, you know, in a free market, it's perfectly liquid by supply and demand. And this chart that we're looking at here is both is supply and demand. You can see the blue line here, that the turquoise line is demand. And the purple line is that they call committed.

capacity. This is basically supply is kind of the way to think about it. These are people who've agreed to put energy into the system. So this could be coal, it could be nuclear, it could be gas, natural gas. It can be any generation source, essentially. And if you remember on the last chart, we had that price spike to like $85 or so right around our ending, they call it 21. You can see the reason is that because demand, and supply are getting pretty close here. And what we saw just two weeks ago, actually, was that demand and supply actually touched. They got basically to a point where there was no excess supply available.

What happens when that happens when that overload condition happens? So, Erkot has a bunch of procedures and policies around this, but by and large, what happens is they actually go and ask the utilities, the people who are delivering the power, to shut off the power. This is like similar to what you mentioned, what happens in Northern California with the wildfires. You just say, hey, we're going to shut off the circuit and we're going to do a rotating outage. So they're going to spread the pain by neighborhood. That's right. And they're going to say, hey, this zip code, these thousand oms are going to get turned off for an hour, then this group for an hour.

They don't have the ability to press a button and increase supply dynamic. That's right. And one of the concerns with all of the renewable generation is like you can't, you know, if it's 7 p.m. you can't make more sun or wind, which is sort of is what it is right. It's not a windy day. Germany's learning this. Yeah.

Yes. Yes. And so this is exactly where batteries come in. Yes. You start doing a combination actually of two things. And this is pretty interesting. You both raise this purple line, which is the capacity because you're pushing energy back into the market.

You're basically giving more supply. But you're also reducing demand when you have the battery on them. home. This is a really important point. There are multiple ways to put batteries on the grid. Our methodology is putting them at the edge of the grid on the home, co-located with where you're using the energy. Because if you put the battery upstream on the grid, let's say you buy a farm field and you kind of put it in the, you know, quote unquote the middle of the grid, you're really only helping supply. You can only move the top line here, the purple one. By putting it on the home, you can basically effectively turn off the home from the grid. And

And so you discharge that battery into the home to serve as the home's load to run your air conditioning to charge your EV, et cetera, instead of that home pulling from the grid. And so you're able to basically make this gap here that we're seeing on the screen between supply and demand widen and therefore have a more resilient grid. That's really what we're doing, is moving purple up and at certain times moving turquoise down. But you're not doing solar. So it's just batteries. So I guess the question is, why just batteries? And then we'll get to, I guess, the business model here. Are you making batteries?

Are you agnostic to batteries? And then what does it cost to put these in the average? I'm guessing the average home in Texas is 3,000 square feet? I think things are pretty big there, right? I'm about that. Yeah, yeah. One thing that drives me crazy is when I want to buy something on a website, but there's too much friction when I go to checkout.

I want a smooth and easy payment experience. And of course, it's got to be safe and secure. And sometimes I like to have other ways to pay, like through my digital wallet or even buy now, pay later, which by the way is super popular these days with a lot of people. If you're a merchant, you've got to be able to offer alternative payment methods. So called APMs in the industry. And you know who's the best of this? That's right.

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What's the standard deal you do for the standard home? Because I know constantly, when we talk about things here on this podcast and in life, people tell me, it depends. And I'm always like, my lord, I hate it depends. I like numbers. So I give you the average home. And what do you suggest as the average insol for the average utilization for the average? For the average, time off grid. I promise I won't tell you. It depends, Jason. Oh, God.

So let's maybe go over the business model and we'll go real specific on numbers here. So the high level is it costs our customers $2,000 to put a battery on their home. This is far, far cheaper than if they were to buy the battery outright from any number of different sources and own the battery themselves. Let's get to the business model here because this is like a really key piece. So our business model is we become the energy company for the customer. So again, in Texas, we can be what's called a rep, a retail electric provider. Basically, that means that we build a customer for their energy and we buy the energy

through ERCOT like we just looked at. And we, so we do that. But in addition, and we're the only ones that do this, we give a battery to the homeowner. We retain ownership of that battery. The $2,000 is just the cost of installation. It's not the capital cost of the battery. So they pay $2,000, and then they get the battery in the event of an outage. So power goes out, the battery feeds their home.

But all other times when the grid is up, we're doing exactly what we just looked at. We're decreasing demand and increasing supply, and we're bidding that energy into the ERCOT marketplace. And so on average, for the average 3,000 square foot home, we have a really simple product offering. We install the battery, we handle all of the permits, we handle all the billing, and we handle the entire process. And so $2,000 gets you a battery. You start signing up for our electricity, and then you pay us monthly for your energy. That price that you pay is, interestingly enough, not a typical rate. So basically everywhere in the U.S., including Texas, people pay on a per usage basis.

We're doing basically a flat fee, and that's enabled by the battery. because we're able to kind of smooth out the demand and supply and smooth out the prices, such that we can offer a flat bill. So people can budget for it. So you abstract the variability. That's right. And you, what if, so does that mean you have all you can eat pricing? And then people are like, oh, YOLO, I'm going to just run my air conditioning at 58 degrees.

What we've found, actually, is that people don't really change their behavior all that much based on this. I think like there's a parallel or a bit of a parallel here in kind of the cell phone, you know, marketplace where you used to pay on a per text message or per sort of minute basis. And what we found is people don't really change their behavior all that much. I will say we do have provisions for abuse. And so if somebody is actually running, you know, if they're having all the windows open and or doing Bitcoin mining, et cetera. Busted. Yeah.

So don't get any ideas, Bitcoin miners. It's a, okay. And so batteries, I know the power wall is like 12K now. or something like that. So do you use Tesla's power walls? Do you make your own? How much does the battery cost you to put in there? Because it does seem like this is a finance play in some ways

because you've got to take that cost of the battery and you've got to pick that up, I guess, release it over time. And then there's interest and that's expensive. And then how many batteries do you put into this 3,000 square foot home? And how long do people get told they can stay up and running? in the event of, like, I guess it was two Christmases ago or something. I remember during the pandemic or shortly after, all my friends in Texas were, like,

freaking out because, I mean, it was like a very serious situation because it was 30 degrees and people lost power, so there was no heat. And in some cases, and then people were, I had a friend who had like a generator and everybody was at his house. It's pretty interesting. Yeah. Yeah. Yeah.

Like I said, I was saying earlier, this just like, literally last week happened to some of our customers here in Austin and many more in Houston. So, okay, so you, you're asking about, basically, how does it, how does the kind of unit economics work? Yeah, yeah. So, yeah. So, and you also asked about the battery hardware. So today we're deploying a, mostly off-the-shelf unit that we purchased from a third party, and we put in our compute module. And that compute module allows us to talk to the battery, load our software, remotely command and control it, and get really, really accurate telemetry that we can then feed back into the grid operators to kind of give them a picture of what's going on. We are currently developing a custom unit that I'll show you here. And I'd love to just kind of give you a visual of what this looks like.

And this unit will be available early next year. And this is the base home battery. So this is a custom unit that we're developing. And what you see here is. is what looks like kind of like an air conditioning unit. So most batteries are wall mounted and they're pretty small. And that makes them very difficult to install. And it honestly doesn't make them look very good.

Yeah, you got to find the studs and stuff like that. You got to find the studs. And like, we're installing a lot of these. And so our installers have to know if it's a stud-based house or brick or stone. These things seem like, you know, not that big of a deal. When you're doing a lot of these and you're doing it very repeatedly, they become a very big deal. These look like a small refrigerator, you know, like a dorm room refrigerator. It's about four feet high.

How tall is that? Yes, about four foot, four foot tall and about two, two and a half feet kind of square on the base. And that it is all stackable internally. And so the installation is very easy. Our goal is to put a lot of batteries on the grid. We can't spend a lot, a lot of hours on every home and make it very custom for every home and go find the studs to your point. And so one of the key different differentiators for our hardware product that we're

coming out worth early next year is this concept of making it very easy to install. Typically, batteries are not used for our business case, right? Typically, batteries are purchased by the home, homeowner, and they're typically paired with solar. And so, like, the install time isn't really that big of a deal. We're, you're right, we're trying to build a business around putting batteries on homes. And so our install time is really, really important to us.

So that's, that's the hardware. And they seem like they're extendable. You had two in the picture there. there were different heights. So I guess if somebody has a 5,000 or a 10,000 square for them, they can have four of these. I think the reason for the thin walls was most people put these in their garage. And aesthetically, you know, a two foot deep one is going to take up your garage space. Maybe you've got a tight garage.

Now you can't pull the car in. So maybe these. But again, in Texas, people have pretty big garages, I think. Yeah, these are intended to be installed outside, Jason. Oh, they're outdoor. Oh, okay. That's interesting. That's right.

And so this is like, so they go right next year. 115 degree heat. We have built it, built it for that purpose. So, well, we know, we know our market well. We personally live with the 115 degree heat every day in the summer. And so, yeah, we've designed it with that use case in mind. But basically, the way to think about this is these go next to the meter. And they are the homes interface to the grid.

So it goes basically, the grid flows into the meter that you're likely familiar with, goes into our system. And then our system goes into the home. And again, it's all stackable and easy to, easy to, easy to assemble. How long does the home stay up and running then? So the home, it depends. So I said I wouldn't say it depends. I said I wouldn't say it depends.

I will take that back. Average home. Average home, 3,000 square foot of one of these units is about a day. It's about a day. So that's more than enough. And if you know you're on a day. That's right. And it's extending.

Well, maybe you don't run your washing machine for that day. And maybe you turn off your refrigerator in the garage and consolidate. or you don't run the air conditioner at full speed. Yeah. And if you look at outages, Jason, like the long ones get the press. Of course. What we've found, right, is we've a bunch of customers just north of the city here. And we've had a handful of customers that have only been with us for a handful of weeks.

And they have had multiple outages. And they're like 15 minutes, 30 minutes, 45 minutes. We looked at a lot of outage data as we're building our, you know, building the company here. And what we found is that our system, as just as I just showed you, we protect folks from 97% of outage hours, basically. And so the vast majority of our outages, you're covered the entire thing. And what's really cool is that because it's a battery, it can turn on just like that instantaneously. If you have a generator, power goes out, you know, you generator spools up, everything reboots. We had a customer that was watching National Championship football game, actually.

Yeah, you're on a Zoom call. You're reporting a podcast. and yeah, no problem. Totally. And he didn't even know it. Right now, startups have to do more with less. We all know that. And founders have to be smart with how they deploy capital.

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I will say that the power wall is a much smaller in terms of energy. So this is a 30 kilowatt hour system, comparable power wall and others, N phase, et cetera, on the order of 10 to 15 kilowatt hours. The units don't really mean much, I know, but it just kind of give you a rough sense of kind of the size. And look, we're incentivized to put as much energy storage on your home as we can because we already got the truck there. We've already acquired the customer, right? This is, this is a much different, you know, thing for us than it is for, for others. Normally, a customer would have to

buy two or three or four power walls or whatever in order to get similar capacity. We're incentivized to go put as much energy and power onto your home as we can because there's some fixed costs associated with putting those batteries on the homes. Got it. So if you put in two days or six hours, whatever, it doesn't matter because it's the same install cost. And you get to pour more cups of water into the lake as to your earlier metaphor. So if you're and you're filling up the batteries at the lowest point of the day and you're deploying it at the highest cost point. That's right.

And you may not need to be refre depending on, I guess, the usage patterns, you don't have to refresh it every night. If the person's on vacation or if it's, they're not using air conditioning, it's a temperate day, it's fine. You don't even, you may not need to even refill the battery all that much, huh? Yeah, look, we look at usage patterns, but we also look at pricing. And we also look at outages, right? So we want to make sure that that battery, you know, has full charge prior to outages.

And so the way we look at it is it's typically like I was showing you on the graph there of pricing. The prices are high for a relatively short period of time. It's really almost very typically. End of the day, sun is setting, supply is going down, people are all coming home. It's a relatively predictable time. Now, every once in a while, I'll have a morning peak or a midday peak because a generator went offline or something. But oftentimes we're kind of discharging for that short window. Prices come right back down.

We're able to charge right back up. Yeah. Amazing. And so this is a real world business. You raised a bunch of money. You've got to go out and employ this. I'm assuming getting these into, I know that Texas is one of these places where you have these planned communities. And these builders building hundreds of homes at a time, Belterra, Caltera, all these terrors being built all over Austin around the surrounding of Austin.

And so would it not be the most efficient to work with those folks to add this as a feature to those planned communities? Because if you bring a truck with 200 of these battery packs and you have the installers there for a month, you could just put these in when the homes are built. as they're built. Yeah, that's right. New construction is certainly easier from an install perspective than retrofits on existing homes where the homes can be old or have, you know, new work done to them. So you're very right. This is something that we're looking into and working on now. The sales cycles there and sort of the time to deploy is relatively long and, you know, better than anyone else, right? We're trying to get our product into market. We're, I should say, we have a product in market now, direct to customers that, you know, they can sign up on our website,

Tuesday or Wednesday, we can install, depending on all of the permitting and such, which I want to spend some time with you on by Friday, right? So we actually had a customer a few weeks ago that was interested on Tuesday and we installed on Friday. And that can't happen really with new builds because there's this long process associated with the relationship with your firm for. So there's two different relationships. There's the energy services and then there's the battery.

The energy services are a year by year. And that's pretty standard in the market. And then the battery is a, is a, is a, is a, is a, is a, is a, is a, agreement. However, uh, you have the ability to transfer it to a new homeowner, to take it with you to buy the battery if you'd like to it, uh, you know, what does it cost to buy the battery out. Yeah. You want it to go it on your own. Yeah. Yeah, it depends on the, what the, what's the, standard battery. Yeah. Yeah. Yeah. So if, if,

in the 10s, the low 10,000. Uh, but yeah. So if, if, because that would be my fear, like, what if something happens to your company or startup or like how do I know that if there are you know I don't know it advances in electricity in my area that you're the deal I sign up with you at a flat rate and what does it wind up being compared to if I didn't have the battery like what's my savings typically 10 20 30 percent it's it's the energy prices and the and the deals that people sign with their providers today are really wildly varied so some folks get a very competitive price. Some folks had a very uncompetitive price. We're typically able to match or beat, given the fact that we have

this battery, basic, you know, most are all today. So you look at their patterns or the homeowner looks at their pattern for the last two years. They look at their electrical bill. They give it to you, or you look at it, or you just have an off-the-shelf deal. How do you calculate all that? Because that would be the only, that's the only blocker for me. If I had a home, I'd be like, wait a second and now I'm locked into this. What if prices get cheaper? Did I, you know, and I'm paying a higher price to you? Yeah.

How do you deal with that? Or is it dynamic pricing? In other words, if you can make it lower, do we both share in the gains or only you share in the gains? Yeah. So we, so the short answer is we both share in the gains. So the pricing, we look at the pricing every year. So that's why it's a year by year deal. And you're very right.

We look at your past year or two, depending on how much data. we're able to collect of usage and that you give us access to. So you share basically a number with us and then we're able to, you sign some paperwork that says, hey, you're okay to get my usage data. You look at that and we calculate basically what you did pay on average, what our rate is, which is typically lower, and then we show you that. The whole thing here is, and what you'll see a lot in the Texas energy market is the standard retail electric providers are not very transparent in their pricing. They have weird pricing schemes

like free nights or like weird rate structures. Yeah, it's not, it's not very consumer-friendly typically. We give you, we give you all of our data. We say, hey, look, here's what you used. Here's what you are paying now. Here's what we would charge you over the next year. And then we'll just reevaluate it and we'll give you the same reevaluation every year based on your usage. and that combined with the flat rate, we think is much more sort of consumer friendly and just much more we think that people want to think about their energy

less, not more. And so we're like, hey, look, we're going to show you how we're giving you a good deal. And by the way, you get all this outage protection that you wouldn't have otherwise had or you would have had to pay a lot to buy the battery or a generator. And so it's a win-win both for us

because we get to a place to put the battery on the grid and it's a win for the consumer because they get the outage protection and the more affordable rate and the sort of transparency that comes with it. But it's a win for the state because you're now taking load off of the grid. Therefore, the grid, people managing the grid have less to worry about your home has become independent. How many of these have you deployed so far? You're in beta right now. You've installed 10 of them, 100. Where are you at with the company?

Yeah. So we are doing about one install a day. We just started installing a few weeks ago. We've built a, it's a very operationally intensive business, right? The customer says that they want battery to we have one installed in their home. There's 12 different steps. We handle all of that internally, and that's what we're building out. And so we're on the order of, I think, 27, 28, but that number keeps going up every day

with the goal of hitting in the hundreds later this year and really, really scaling up. Here, focused in Texas, there's just so much to make. and so much need. We just launched the company a few weeks ago publicly. Yeah, I know. So we're just getting started with... Are the regulators helping you or slowing you down?

In California, if you try to do anything here, they're just... Yeah, they're going to throw up roadblocks. I think even now, like, the number of power walls are allowed to put up, you know, solar, selling back into the grid. They've thrown up all kinds of roadblocks in California because I think they don't want people to compete with them because it's not like in marketplace.

That's my understanding of it. I'm, you know, you can correct me if I'm wrong if you know, but are the regulators there in your corner trying to help you get this out there because they have this problem of the grid going down or people see you as a threat? How are you getting perceived in the market? Yeah, that's a great question. You know, I think overall pretty well. I think like the Texas energy market, as I was mentioning earlier, is quite deregulated such that it's really just a sort of best idea and best product and best service and best price win. And so, look, we're competing on merits. I will say that local municipalities typically have to permit the installation. So the city of wherever you live, Waco, Houston,

Dallas, Austin, et cetera, has to give you a permit, just to have us a permit, I should say, to put the battery on the home. And, man, the variability from city to city is wild. So you'll see some that are, hey, thumbs up, you're doing something really great for the grid. And, you know, you gave us all of your sort of safety certifications and all the safety on the hardware and all that. And so we're not going to kind of get in your way. Some cities are much less sort of open, open to that. And this is one of the big challenges of building in the energy space broadly. This is, this is really, for anybody that is building physical grid infrastructure or physical home devices that touch the energy grid or touch even home electrification, there's a slew of testing and

certification regulatory hurdles, and so... Which are designed to keep the house from going on fire, right? I mean, like, it's to save people's lives. Totally. All good there. What's the longest it takes you to pull a permit? Which area is the worst? Which areas is the fastest?

I'm curious. Well, I don't want to call out any... I don't want to call out any specific. Well, give me the range. Like, what does it take in Austin to do this? Austin seems like a pretty progressive city. I could be wrong, but Houston seems to be the most. I mean, you go to Houston.

They're just building like lunatics there. Yes, yes, Houston is quite easy. It tends to, it's not always this way, but it tends to be actually that the bigger cities are more difficult than the more rural communities. And so it ranges from two, three days for a permit to four or six weeks. And look, this is this is the one of the key operational challenges that we run into is making sure that both we have the right expectation and we've set the right expectation for the customer on the timeline. We would like everyone to be, like there's a handful of cities north of Austin here that are quite quick in the span of a handful of days. And look, they're doing all the same safety reviews. They're looking at the same documentation.

This is all, as you exactly pointed out, for safety. It's just a matter of speed of execution and sort of ability to do it. And it's going into a home. That's right. The hundredth one going into a community, they should give you a different dispensation if you're like a, trusted provider with a trusted hardware set that's done a certain amount of homes. Or what does it cost to pull a permit in one of these towns? Like, $100, $50, they should give you the ability to pay $300, like five times as much

to get a same-day permit or a 24 or 40-out-a-perment. Do they offer that? Or are these municipalities kind of just, you know, lolly-gagging? Jason, can I bring you into some of these meetings or can we hire you? Like, man, that's what you totally, totally agreed. Yeah, the short answer is no, they typically don't have this sort of expedited process. And you're exactly right. Wasted opportunity for revenue for them.

Wasted opportunity for revenue, I agree. And also, I think it's like a, it's a, you know, it's a new model. So some of these, some cities have relatively quick permitting structures for solar as an example. But batteries are still relatively new. Got it. And they're kind of this new thing. Some have relatively quick structures for generators. We don't necessarily get that same treatment, although we're working very closely, especially with some of the smaller municipalities and like to some of their credit here in Texas.

They're very forward thinking. Some are more than others. Yeah. But your idea of expedited permits and, hey, it's the same thing every time we should be kind of looking at it as a portfolio as opposed to each individual one is different. Totally aligned there. And this is something that we're working on with a number of municipalities. They should let you have a trusted vendor program. where you have insurance, you have, you go through some training, whatever, some agreement as to the quality of what you're doing, you pay them $5,000 per year.

They get a reoccurring revenue stream. You're a preferred vendor, preferred vendors, you know, get to have their permits in 48 hours. You know, if the city would have a thousand of these, you know, some tiny municipality have a thousand of these preferred vendors or something. You know, they make another half million, another $5 million a year. They had a thousand of them, man, that's real money to go to school. to go to roads, to you know, whatever. I mean. And these benefit the community.

They add value to homes. They're good for the grid. Yeah, look, very much... You do it in a heartbeat, right? Speed is what matters for a surpeed. And I'm like, this is one of... And so, and to the people who are going to email me and say, like, well, that's not fair.

Everybody should have to wait in the same line. That's just not how the world works. Like, if there's a free marketplace, if there's an incentive for you to get these out quicker, which is saving the grid and saving people, people money, you should be able to reasonably, it shouldn't degrade the weight other people have, but I don't mind if somebody's paying for like the first class seat that costs $20,000 is going to Dubai knowing that my business class seat subsidized by that person, you know, was paying

three times as much for all close to the same experience. Yeah, look, I think it's, it's really interesting and the sort of ground game that this business requires, right? We go into a local municipality. We want to build relationships locally. We're doing on the ground marketing. Interestingly enough, Uber had a kind of a similar approach to a lot of these kind of early, early city launches. And while it's a very different business, obviously, there's a lot of lessons learned from them and from Solar City and others. And so, look, I think the world is moving more towards what you just outlined. There's some federal level work that's going into a standard permit application across multiple municipalities.

The state regulators are, I think, pretty interested in basically the vision that you just outlined. So it's moving that way, I think. And we're hoping to be a part of driving it further and faster. One thing on the battery technology, how many cycles can these go through? What is the planned obsolescence for these? I have a couple of Tesla sitting here that are over 10 years old right now. They still have 90% of their battery capacity.

and I think my original roaster's at maybe, I don't know, 15,000 miles, and my Model S signature O-O-O-1 has got maybe 25,000 miles on. These batteries don't seem to degrade, and those are the OG batteries from over 10 years ago. How long are your batteries going to last for and, like, how much they cycle, you know, they're going to last 10 years, 20 years? What are you thinking? Yeah, so we're cycling the batteries, you know, most days. And so on a one or two cycles per day, less on the order of 15 years.

So this is a newer battery chemistry than what you have in your S and Roadster called lithium iron phosphate LFP. So this is being commercialized in the auto industry. And we're able to use a lot of the core sort of R&D that has been developed for that, you know, for that market, but for stationary storage. So, yeah, it's a. Samsung is going to be able to. making them in Texas, I understand, right?

Like they're... That's a chip factory. So just right here in North of Austin, they're actually building... Oh, Sapsin was also making batteries there. Who's making the batteries? Maybe I got the wrong company. Some company that's going to be making batteries in Texas. So there's a lot of supply chain domestication on batteries that's happening here.

A number of companies, both international and U.S.-based companies. So you expect those prices to keep coming down for batteries and the quality of them to go up on some I think that's right. Yeah. Look, the auto industry, the stationary storage industry, IT, all of these are really pushing innovation on batteries and we're both benefiting from it and contributing to it in a specific area, which is this sort of residential-sized equipment. I love the fact that the new cyber truck has the inverter.

You can plug it into your wall and get to use its battery. That's a giant battery too. So that'll be interesting to see if that becomes the standard, then you could have like a double-backer. You're home's got a battery, last a day. And then, you know, you have two or three cars. And I think all the manufacturers will copy that innovation, right, to be able to... I think Rivian does it as well, right?

You can Ford. Ford does as well. Oh, okay. So those will have some... Can those... Or do you have a plan to have those be like to icing on the cake kind of for your system? Yeah, that's kind of the way we think about it. You know, we think that there's a place for stationary batteries that are mounted to your home. And the reason for that is that you can't always guarantee the grid operators

can't always guarantee that your home, that your battery, your car is there, that it's charged. Of course. And that it's ready to observe the grid. And so we look at this as more of a grid asset that we're bringing the, you know, sort of homeowners along for the journey here, as opposed to it being, you know, like a vehicle where it's a owned by the, by the consumer. It's, it's different in that, like, you can't play with or drive or get enjoyment really out of your battery.

It's just sort of there to serve. serve your home. Whereas the car, you can do all of those things, right? And people don't want, people want, if you're buying this, it's because you want to know

you're off grid and you're safe and your family safe. That's like, I think, I'm going to guess four out of five people who contact you, that's the reason.

And when you have the next outage, your phone's going to ring off the hook. So that's when you've got to do your marketing. That's when you got to plan your social media campaigns around, you know, the fear.

Because if you double, click on this. There's like a really good framework for understanding customers. I've been talking to people about it, like this sort of deep listing when you interview the customers and hopefully you're doing that when they call you. But if you double click on it, like,

it's going to be, you know, oh, well, I have bulldogs and you know, if this, or if we were to lose power with the bulldogs, they need air conditioning. Like, they could die and have a heart attack in 110 degree weather. So this is for the, this is life threatening for my dogs. Or I have

a parent who's 85 years old, I need to have this because if they're not going to survive in a 110 degree heat. And that's what happened. Tragic were like real cold. Like there were debts because of this. So that's right. There's going to be like very deep. And then there's people who are like, hey, I have a mission critical job. I need to be off the grid like I do for podcasting. I installed, um, on my ski house and here, uh, Starlink, which I use maybe 10%. I probably use it one percent at the time. But that one percent, means I don't have to cancel a podcast episode, which has advertising on it or an important meeting,

it's easily worth the combined $2,500 I pay probably. Like if it's $100 a month or $120 a month, I'm probably paying $3,000 a year to have a backup. But if you're working from home, that backup pays for itself with one episode of a podcast saved, you know, every 10 years. Yeah. Look, and we think that it's exactly like kind of your Starlink example here,

where the battery is very, very, very critical, but only for a very short period of time, but that battery should be supporting the grid all of the other times. And if you buy a battery, that's not the way it typically works. The battery should be used to support the grid and sort of bring in and usher in the era of renewables

and lower the system costs on the grid and kind of back to the original point on that stacked bar chart, decrease the delivery costs over time. Are you going to get into solar over time or did you just pick to do batteries because you can move faster in solar is like really hard to do because you're actually ripping a roof off? Yeah. We will certainly move into solar over time. But it's exactly like you said. It's a much more complex product.

The installation is far more specialized for each one. You have to map out the roof of the home. You have to go out there. You have to take a bunch of measurements. A lot of people don't want solar on the roof because there's holes in the room. into their roof? Aesthetically, it can, yeah. Yeah, that's right.

And so, and the grid needs, doesn't need more solar. I mean, you could use more solar, but it doesn't need more solar. What it needs today is batteries. Yeah. And so that's, that's really what we think adds both societal benefit as well as to the What is the grid going to look like in 10 years? Because it does seem batteries will be, have twice the density and half the price in 10 years, I'm guessing.

Yeah. So what will the average home in Texas if you succeed in 10 years from now, We see, you know, some doubling, tripling in the cost curve or cost to storage curve of batteries. What will the grid look like in Texas if you succeed? So I think the vast majority, not 100%, but the vast majority of generation goes from coal and natural gas to wind and solar and some nuclear. Nuclear is a bit of a can of worms. Maybe we go down that rabbit hole later. But I think it's just, it's purely just a economic thing.

It's not because it's like some sort of climate change driven desire. It's purely an economic thing. So I think the generation stack moves more and more away from fossil fuels and its renewables. And then the consumption stack, there's a battery in every home. There is a battery that load balances the demand such that when demand is peaking, you're discharging either into the home or onto the grid, and you're charging when demand is low. And so you basically kind of flatten the duct, so to speak.

You push down the head and you increase the best. belly and you have much less of a swing in the capacity of the grid. And you're actually using the existing infrastructure far more effectively. We can add a lot more batteries under the grid without building a lot more new infrastructure and making more poles and more wires or bigger poles and bigger wires, so to speak. Any new nuclear approved in Texas yet? No, not that I'm not that I'm tracking. Look, nuclear is really exciting.

We're extremely pro-nuclear here. I personally am. It's a different problem, though, that's being solved, right? That's the generation. That's not the grid itself, right? You could have a 100% nuclear grid, and you would still want batteries to smooth out the demand. People think about nuclear just from the sort of generation perspective, or you think about the grid problems, I should say, from a generation perspective. But really what matters is that the system is sized for peak load.

And if you can reduce that peak load, you can now sort of effectively have more peak load. it. And nuclear certainly helps that. It certainly gets rid of the sort of supplied volatility of the sunsets and the wind, you know, dying down. But it doesn't help the sort of demand volatility of people going to work, coming home, turning on their lights, turning off their lights, etc. Yeah. It would certainly add another competitor to the mix and a consistent competitor, which means, you know, that supply demand curve, like they could say to the nuclear reactor, hey, things are getting tight. Can you turn a dial and give us more, right? So you could, I think nuclear is a little more dynamic in that way, or, hey, we got a heat wave coming this, you know, next 20 days, and we can predict that kind of stuff. They could increase the output, yeah? Some can. It's not as easy as it might seem, at least current nuclear generation technology. If you think about demand as kind of like a, say like just a like a sign wave, kind of a, you know, moving my finger here to kind of describe it. Right now, nuclear is below.

the trough of demand, right? And so if you build a nuclear plant today, you know it's always going to be running. You're going to be making money different prices all the time, but you're always going to be running. You're going to have 100% or nearly 100% what they call utilization. As you add more and more nuclear, you're above the trough. And so now you have to turn off at certain times. Yes. And so if you can make that curve much flatter, now you have more utilization of your nuclear resource or any other generation for that matter. amazing if the belly of the duck, if nuclear was above the belly of the duck, if it came up to the chest, then you would be above the low demand and you can redirect that towards batteries during that time. Exactly.

And they could start putting batteries next to things or you could put AI data centers next to these and put data centers. I mean, that's what everybody's trying to do is find the cheapest possible electricity to put batteries next to it. And that'll be like the next card to turn over is, you know, a bunch of. of batteries next to nuclear power plants or a data center next to it because who's going to complain, you know, about a data center being next to a nuclear power plant. That's right. It's not like there's thousands of people living there. Right, right.

Yeah, Jason, I think if you look over time, over the history, energy use has just gone up, right? And if you also look, there's a really interesting chart online that I'm happy to, happy to share, but is of GDP per capita of a country versus its energy availability, how much energy it has. And what you'll find is there's a direct correlation between these two. More energy, higher GDP per capita. This is really the sort of fundamental thing here is how do we increase the availability of energy such that we can increase human prosperity? I think it's fundamental to so many industries.

Obviously, the recent advances in AI, but transportation, agriculture, manufacturing, my background, it's all sort of derivative of energy. And if we can solve the energy problem, we can build a lot more really cool stuff. It can be done. China has 54 units currently active and they have 24 under construction and 300 plan. So this is like easily doable. You just have to have the will. And I think, you know, everybody can help with this. And we're going to live in a world in our lifetime when there will be no fossil fuels in our lifetime burned. except in rare cases, it's going to be very rare. Like you've got some antique car or you've got some plant somewhere like on an island that I don't know, doesn't support nuclear.

There's a small island and there's not enough solar to deal with the peak capacity for obvious reasons. And that's right, you have to burn oil or coal. It would be like this exception that like on Hawaii or, you know, whatever, Turks and Akos or wherever, you have to turn it on for some reason. But that's awesome. working on this, hard problems. And, yeah, hard problems make hard founders, hard founders, make good times, good times, make weak employees who are entitled and then the cycle renews again.

I'm glad to see we're in the part of the cycle where there's hard problems being addressed by our core founders to make great times. And thanks for coming on the pod. And we will see you all next time on this week in startups. Bye bye. Okay, founders. It's very lonely to be a founder, right? Everybody thinks you're like a mutant.

Well, guess what? I am Professor X and I have found you. And I know where the other mutants are. And I know where the mutant founders are in your town. That's why I created Founder Fridays. What is Founder Fridays? It's a monthly meetup for founders by founders. No salespeople.

No VCs. Nobody looking for a job. Founder Fridays. Four founders by founders. Now, what do we do at these 121 meetups that are occurring around the world. New York, Tokyo, Sydney, Toronto, you name it. Fifteen hundred people have attended so far, and we're in a hundred twenty-one cities. And if we're not in your city, you can start it in your city. There's only really two rules here. Four founders, by founders. So we have an assignment

for everybody coming to Founder Friday this month. What is the biggest challenge you're facing? And what's one thing you can do today to close a new customer? Think about that. If we just solve those two problems, right? If you hang out with seven other founders, eight of you, around a table, Maybe you're having pizza, coffee, dim sum, whatever your jam is. It could even be a cocktail. Maybe you're having a beer garden here in Munich and there's a beer garden. Maybe you're in Tokyo and you're at Izekiah and you're having some beers and some sushi and, you know, whatever. That's the magic of Founder Fridays.

Where you do it is up to you. What you eat, what you drink, that's up to you. But the assignment is up to me. What's the biggest challenge you're facing? You go around the table, all eight of you, explain what your big challenge is. And then you help each other. It's that simple. Because if you're facing a challenge, I can tell you.

you around that table of eight founders, there's going to be three or four that have already solved that problem. I've been doing this for over 20 years, and founders helping founders is the best way to do this. Don't go online to get help. You can listen to this weekend startups, of course. But founders hanging out with founders every month is going to make it less lonely for you, and you can then pick an accountability partner from your meetup, and then you report back to each other. Maybe you do it daily, maybe you do it weekly. Okay. And there's going to be a bunch of perks to keep you coming back. You get to be part of our Slack community where you get to keep the conversations going. Also, the hosts get a lot of social media love. You will see if you

follow me on Twitter, Instagram, other places that I constantly interact. I follow, I retweet, I reply to all the people hosting these. So if you just follow me, X.com slash Jason on what used to be called Twitter, you can see that we're all continuing these conversations online. If you attend three plus meetups or you host them, you get a personal invite to Ask Jason Live. That's where you get one-on-one time with me, your boy, J-Cal. So what I got to do is come to three meetups or host, and you get a little bit of FaceTime with J-Cal virtually, of course, or you never know. I may show up some of these.

So if there's not a local chapter near you, don't worry, we're going to help you set one up, and you can be the leader of your own local meetup. Here's your call to action. It's super simple. Head over to this weekin startups.com slash meetups. This week in startups.com slash meetups, one word, no spaces, no dashes. You'll get registered, you get involved. Mark your calendars.

The next one is June 7th, June 7th. That's right, Friday, June 7th. That's what we call it Founder Fridays. Okay, we'll see you there. Bye-bye.