Imagine standing at the edge of a vast canyon. Your goal is on the other side, seemingly unreachable. You lay down one brick, then another. Sometimes, despite your efforts, the other side doesn’t seem to get any closer. But you keep going, brick by brick. This requires immense mental stamina. It’s about recognizing how much you’ve done, seeing how much more there is to do, and not throwing up your hands in despair. In my interviews with startup founders, a common trait emerges—resilience. These guys and gals just don’t give up. Day after day, they show up and do the work. They call investors, reach out to clients, and coach their teams. They confront the yawning chasm between their goals and their current position every day. And they choose to step into it every day, or, more accurately, build a bridge across. Mental resilience surpasses entrepreneurial drive, motivation, and even passion. On tough days, when a client decides they don’t need your product or another investor turns you down, no pep talk or a positive attitude will push you forward. It’s your will, your grit that keeps you moving. So, to all the startup founders out there: stay strong. Stay resilient. Put your helmet of mental resilience on, and stride forth!

Startups often dream of being acquired by big corporations or growing to become such giants themselves. But to succeed in either path, understanding how corporations think about innovation is crucial. The best place to start? Clayton Christensen’s seminal work, The Innovator’s Dilemma . Christensen dives deep into the nature of disruptive technologies and why established corporations struggle to invest in them. Disruptive vs. Sustaining Technologies Consider Tesla, the iPhone, wind turbines, solar panels, AI, and now NVIDIA chips. Then think about ICE cars, mechanical excavators, 5-inch floppy disks, and old cellular phones. The latter set were once disruptive technologies, now replaced by newer disruptions. Many believe new technologies win solely because of their superior technological value. They think being better is enough. But that’s far from the truth. Clayton Christensen dissects the success factors of disruptive technologies, showing convincingly that it’s not technology that wins markets, but flexible business strategies and cost structures. Characteristics of Sustaining Technologies Christensen differentiates between sustaining and disruptive technologies. Sustaining technologies are well-established, providing high margins. Customer demands are clear, requiring massive investment for incremental gains. Think smartphones: each new model slightly improves on the last, but no groundbreaking changes or new markets are created. Characteristics of Disruptive Technologies Disruptive technologies, on the other hand, start as underdogs. They’re less sophisticated than sustaining technologies—simpler in design, often smaller, and more convenient. Their value proposition isn’t immediately clear. They don’t solve the problems of existing customers, appealing instead to small, fringe groups with small margins. Challenges in Corporations Interestingly, many disruptive innovations occur within large corporations but fail to thrive. Why? Why do industry leaders consistently miss the boat on disruptive technologies? Imagine pitching a disruptive tech investment to a corporate committee. You need market size, pricing, investment estimates, and financial returns. The problem? None of this data exists. Christensen explains, “Companies whose investment processes demand quantification of market sizes and financial returns before they can enter a market get paralyzed or make serious mistakes when faced with disruptive technologies. They demand market data when none exists and make judgments based on financial projections when neither revenues nor costs can be known. Using planning and marketing techniques developed to manage sustaining technologies in the very different context of disruptive ones is an exercise in futility.” In essence, approving a disruptive project within a corporation is nearly impossible. It will lose to existing products on margins and risk-adjusted returns, and it will cannibalize current markets. No sensible manager will allow it. The Solution: Starting Anew So, what’s the solution? Start a new company focused on the smallest viable market. This new company’s business structure, strategy, and costs will align with this small market. It will build its supply chain from scratch, becoming leaner and faster. This is the only way it works. Christensen’s research shows that new entrants were responsible for every successful instance of developing and adopting disruptive technologies, not the incumbents. Corporations that thrive long-term master the art of adopting disruptive technologies by creating new companies completely isolated from their core operations. From Disruption to Sustaining New products usually involve little new technology. They take existing tech, find the market, adapt the product, and simplify it. Starting with a small market, they grow. They develop the disruptive technology until it matches the sustaining technology, eventually becoming the new standard. Due to lower margins and a leaner structure, the new entrant eventually drives out the incumbent. Conclusion The Innovator’s Dilemma is a must-read for startups and corporations alike. For startups, it provides invaluable insights into how to navigate the challenging path of innovation and disruption. For corporations, it offers a clear roadmap on how to embrace and foster disruptive technologies without being paralyzed by traditional business practices. By understanding and applying Christensen's principles, both startups and established companies can better position themselves to thrive in an ever-changing technological landscape.

🌱Everyone seems to have forgotten blockchain now that AI is the hottest topic, but it’s far from dead. Recently, I discussed the potential of using blockchain for tokenizing greentech technologies with a startup founder. ⛓️It can be tempting to add flashy technology, especially to attract investors. I’m no crypto expert, although I have some experience in the crypto markets—both positive and negative. So, hear me out and help me understand. I see two potential ways blockchain tokens could be used in greentech. 💹First, the shares in a greentech startup could be converted to tokens, which are then sold, giving investors a claim to the company’s profit. This sounds simple in theory, but I imagine it would be legally complex. 🤷🏻‍♂️But why would this be necessary? Tokenization allows ownership to be divided into very small slices, possibly suitable for crowdfunding. However, most greentech hardware products require large investments that are hard to raise through crowdfunding. If you just need funds, why complicate matters with tokens? ⚡️Second, tokens could be issued based on output, like kWh from a solar plant or kg of hydrogen from an electrolyzer. My friends in the crypto world say these tokens can be traded, but I don’t understand the underlying value of the token. It could be tied to carbon credits, but that would limit it to projects actively removing CO2 from the atmosphere. ❓Maybe it’s just ex-crypto enthusiasts looking to apply their technology somewhere. While tokens can be added to greentech, I just don’t see the point. Outside the carbon offset market, it seems like additional costs with zero benefits. What’s your opinion? #Blockchain #Greentech #Startups #Innovation #Crypto

The Tyranny of Choice I've recently completed ten market research assignments for a corporate investor looking to dive into green technologies. We explored  hydrogen, carbon capture, circular materials, renewable energy, batteries, EVs, waste management,  and more. Each sector had numerous technologies, all at different stages of market readiness.  Which ones should the investor pick, and why? The IEA database lists over  550 different technologies for the energy transition.  These include renewable energy technologies, abatement technologies like CCS, energy efficiency technologies, and industry-specific innovations like electric vehicles and industrial heat pumps. How do corporations decide which ones to invest in? Greed and Fear in The Towers of Steel and Glass In 2020, I pitched an investment in lithium-ion batteries to Rosatom’s investment and scientific committees. At that time, the cost of cells was over $300 per kWh, three times what it is today. My task was to secure $100M to start the project, with an additional $500M of equity investment to come later. Despite the growing EV market worldwide, my superiors were concerned about two things: lack of demand for batteries in Russia and the risk of choosing a technology that might become uncompetitive and fast.  This scenario showcases the two main motivators in corporate ecology: fear and greed. Overcoming Fear The fear factor was overcome by demonstrating that our NMC technology was gaining market share worldwide and that we were acquiring a company with robust R&D capabilities. We also had to to a 100+ page report detailing all other chemistries of anodes and cathodes, and demonstrating that the NMC technology would survive for the next decade at least. Also, owning a battery technology could in theory make it possible to use them at nuclear power plants, making them more flexible energy generators. A sort of insurance against an overabundant grid (which was and still is the case in Russia). This reassured my superiors that our investment was sound. Leveraging Greed The company had a strategic goal of doubling its non-nuclear revenue by 2030, under a strategy dubbed “let a thousand flowers bloom,” which is a shorthand for «we have no idea how to get there». My project promised significant revenues by 2030, and the company we were acquiring was already generating revenue. The manageable risks, combined with the strategic fit, made the investment appealing. The Insider The balance between fear and greed determines whether your technology gets funding. Many startup founders mistakenly believe that corporations are eager to invest in new ventures, as they are supposed to maximize profits in the interests of their shareholders. In reality, 98% of corporate executives are terrified of investing outside their core business. Their salaries and bonuses are tied to the core business’s success, with any new venture KPI added as an afterthought. To tip this balance in your favor, you need inside help. Most successful corporate investments in new tech have a corporate insider, who champions the tech before various corporate committees and decision makers. When a fellow corporate sees such a champion, he or she is happy to let this champion handle the startup, as this champion will bear all the blame. This person usually works in the strategy department, and that is no coincidence. You need to show that your strategy is working, by matching it with potential startups. Other places, such as corporate accelerators or R&D hubs could be a good place to look for. Getting your foot in the door To get your technology deployed at scale by a corporation, consider these strategies: 1. De-risk Your Technology:  Provide robust case studies to demonstrate success. Show that technological risk is non-existent and that market risks is solved by having real customers. If those customers are currently your target corporation customers - so much the better. 2. Understand their KPIs:  Know the key performance indicators of your corporate counterparts. While none of them are likely to share theirs with you, ask leading questions like, “How can this project/technology help your department’s goals this or next year?”. Focus on the now, as KPI’s are usually quarterly or year-based. After that nobody really cares, even the guys in the strategy department. 3. Position as Insurance:  Frame your technology as a way to protect the market share of existing products or ward off competitors, not just as a new venture. 4. Find an Insider:  you’ll need a champion in the Tower. Someone, who will constantly bother other corporates about your startup, so much, that they will just give up. If you want your technology to be deployed at scale, you’ll need a corporation. But remember, the more boring and de-risked your technology appears, the better the chance it will be invested in. Understand their KPIs, position your technology strategically, and address their fears and greed to get your foot in the door. And above all - find an Insider.

In a few weeks, I'm gearing up for a road trip around eastern Turkiye. Renting a car is a must, but I want to do it in an environmentally responsible way. My algorithm is clear: go first for a fully electric car, and if that’s not available, get a hybrid. EVs are the cleanest, ICE cars are the dirtiest, and hybrids are somewhere in between. Simple, right? Still, some naysayers claim that EVs are bad for the environment. What they’re implying is that ICE cars are somehow better. These folks clearly haven’t lived near a highway or a busy city street. For those lucky enough to live in a cabin in the woods, driving gas guzzlers around tree stumps, there's now a nifty tool to compare EVs, hybrids, and ICE cars. The IEA recently launched a new interactive tool that compares all these types of cars. It’s fun to play with and takes into account years of use, average daily driving mileage, and the energy balance of a region. The only downside is the limited number of regions, but hopefully, more will be added soon. And before you come throwing sh*t at me in the comments about batteries being left in the open, higher tire wear, etc., try living in the center of Istanbul for a summer. I bet you’ll become an EV convert in no time, just like all those investors who poured record funding into EVs last year—almost $90 billion, according to Pitchbook INC. Have a nice summer! #EV #Summer #ClimateChange #Startups #innovation Here is the link to the IEA comparison tool: https://www.iea.org/data-and-statistics/data-tools/ev-life-cycle-assessment-calculator

About 8 years ago, I was working in Novawind and running several projects simultaneously - acquiring wind turbine manufacturing technology, rolling out the production of wind turbines, and developing wind farms. Given that this was the first time wind turbine manufacturing and wind farm development was done at a scale in Russia, I pitched my boss the idea of hiring consultants. He didn’t see a point but allowed me to continue. I had in mind several tasks for consultants. First, as usual, I needed consultants to review our strategy. I didn’t need their review per se, but I needed the stamp of a major consultancy on my strategy, so it would have more weight in the investment committee meeting. Second, I needed access to experienced people from the wind industry - engineers, supply chain, and factory managers. We didn’t know much about running a wind turbine manufacturing company then, and desperately needed advice. Third, I was about to manage a Russian and a Dutch team and ensure they worked well together. So I decided I needed a mixed Russian-Dutch consulting team. Finally, as our company was a part of Rosatom, a state nuclear energy company, I needed consultants with experience in complex project management with large Russian state corporations. My ToR reflected these needs pretty well. I wanted a Russian-Dutch team, with experience in managing $1Bn+ infrastructure project for a Russian state corporation, and access to at least three professionals from the wind industry with 20+ years of experience. The task included organizing project management, team integration, consulting on factory roll-out and supply chain organization, and, of course, strategy stamping review. Soon, I had a score of top consultancies to choose from. KPMG, EY, AT Kearny, and McKinsey, all submitted bids. These ranged from $ 300,000 to almost $2M. Now, the rule of dumb thumb of Rosatoms’ procurement is to go for the lowest bidder. I couldn’t afford that, as the lowest bidders matched max two of my criteria. The highest bidders also couldn’t match all criteria, especially in fielding needed industry experts. And then there was a mid-range bid from Roland Berger. I knew I couldn’t just award RB the contract, as it would go against all corporate rules. So I went to my boss with these arguments. First, they have experts with 20+ years of hands-on experience in wind turbine manufacturing. Second, they are ready to assemble a Russian-Dutch team to help us coordinate cross-cultural communication. Third, they are already working for Gazprom on the South Stream project, so they know well what it is like to work with a Russian state-owned company and run a $1Bn+ project. I visited Roland Beregers’ Moscow office shortly before the start of the Russian invasion of Ukraine. By that time, they were on their third or fourth contract with Novawind. The Russian-Dutch cooperation mechanisms, project management and reporting techniques, and much more were established and polished over the 5 years since we first hired Roland Berger. My former management saw the added value of not-so-cheap consultants and continued hiring them for new projects without my insistence. Two months later RB closed all its Russian operations and moved the team abroad.

It was January 2022, I was standing outside one of the towers in Moscow City, Moscow’s skyscraper-packed business district, thinking about a job offer as the CEO of an electric vehicle charging company. This was my last check on the Greentech sector perspectives in Russia. I was planning to leave the country, as I saw no big-time opportunities for private business growth in Greentech. Having already launched two industries in the country - wind turbine manufacturing and lithium-ion cells, I saw EV charging as the last possible opening. A week later I declined the offer. Two years on, the EV-charging industry has been the third biggest recipient of investors’ cash in all EV-startup ecosystem, right after batteries and EVs. These startups seemed to be solving the biggest roadblock to widespread EV adoption - reducing charge anxiety. But the last two weeks delivered a devastating one-two punch to the industry. First, Tritium, one of the largest private charge networks went into liquidation, and then Elon Musk laid off the whole Supercharger division. This news left the industry in turmoil. Analysts scrambled for answers and from what I’ve seen, blamed anything, from overhead overruns in Tritium, to Mr. Musks’ mercurial personality. What I haven’t seen yet, is an opinion, that made me decline the offer of a corner office two years ago - most EV-charging business models don’t work. Roland Berger Consultancy had an interesting analytical piece lately, describing three main business models for EV-charging: Pure players Automobile OEMs Utilities (non-regulated income, strong balance sheets.) I agree with their classification, but I think that only one model can make it big time and over the long term. Let’s dissect them. Pure-play charge point operators (CPO) Pure-play companies focus on providing charging services, as Tritium did. They do it by installing and operating public charging or private charging points. At public points, the only way to make money is on the difference between the price per kWh sold and the cost of purchase of the same kWh from the grid. At private points, the options are a little more diverse. Charges at private locations like malls and hotels have a marketing value, manifesting in attracting higher-paying customers for longer times. This way a charge point operator could in theory decouple its income risk from the pure kWh per kWh trade. The industry sources I know are telling me that the reality on the ground is that not a single charge point operator is making money today. Several factors work against them. First, the high upfront costs of installing the charges force CPOs to leverage debt, straddling them with interest and principal repayments. Second, the current rate of utilization rate of charge points is low. In the UK, for example, the rate varies between 12% for slow charges and just 4% for ultra-rapid charges. While I couldn’t find the utilization rate for Norway, the country with the most EVs, I did find that more than 60% of the time Norwegian EV owners use home charging. Third, the price fluctuations in the power market make it hard to offer predictable charging prices to EV owners. CPOs thus end up with the constant risk of price spikes just when their customers are charging their cars at the “promo” rate. These three factors erode any chance of a successful business case for pure plays. Fixed-income contracts, like pure service contracts from private charge points in malls, hotels, and restaurants can make for a sustainable pure-play business model but are unlikely to make a unicorn. Automobile OEM’s This is the Supercharger business model of Tesla. EV manufacturers have incentives to make their charging network, as it stimulates EV sales. But how do they make money from charging? The correct answer is that they don’t. Charging points are essentially marketing costs to EV OEMs. They help sell more cars but depress the margin on each car sold. You could, in theory, reach a scale so big, that your marginal costs for the next charger are negligible. It is clear though, that Tesla could not reach that level, and they are one of the biggest EV manufacturers and CPO. Finally, as I have shown above for the pure play CPOs, automotive producers will face (and, as Tesla shows, already facing) the same problems. Elon Musk said that he will focus on getting the utilization rate up for the existing charges. The deal he struck just before firing his Supercharger team with other US automakers confirms this. To me, there is nothing spontaneous or erratic in Mr. Musk’s decision. It’s a cold and calculated strategic gambit to cut costs on a wildly successful marketing campaign of Tesla, that has served its purpose. At the same time, Telsa boosts revenues by locking in other car makers to its charging standard. If I were Mr. Musk (ah), I’d also license them my charging technology, to transfer all the costs of further developing charging infrastructure, while creating a recurring income for myself (maybe that’s exactly what Mr. Musk is doing, I don’t know). The problem with such an approach is that you can only do this once. So, no, there is no sustainable long-term business model for OEMs. Sorry guys, Elon just screwed you. Again. Utilities When thinking about EV charging, only one type of company comes to mind that is actually making money on every extra kWh sold - the grid operator. Grids profit from every kWh whizzed by their network. The more kWh they need to transfer - the better. This uniquely positions them for the EV charging business. First, they have all the necessary infrastructure in place. This infrastructure has been paid for through regulated tariffs, and the bulk of this infrastructure makes for extremely strong balance sheets of utilities. This makes it easier for utilities to attract vast amounts of cheap capital and finance projects like rolling out charging infrastructure. Second, charging stations mean additional demand for grid services, and thus, higher revenues for the core business. Third, the combination of the first two factors means that utilities can take a hit from fluctuating power prices, shrug it off, and carry on. So why are they not yet in the business? Electrical grids are not your typical run-of-the-mill business. They are natural monopolies, tightly regulated, very conservative, and a far cry from the gun-slinging VCs of the Valley. For one, in many jurisdictions, they are legally prohibited from energy trading, like being a CPO. This could be circumvented, by either setting up a separate entity or by offering free charging, while making money on additional kWh transmitted. Another hurdle is the decision-making process. Utilities are like oil tankers - these are hard to change course. Boards and investors are risk-averse. A long time ago, I was representing an investor in an electricity distribution company. It is ok to take 3-5 years to come to an investment decision. And grids are usually regulated on a 5-year basis, so no big decisions are made before explicit regulatory approval and a hundred hours are spent on legal consultations. Grid rules Eventually, utilities will come to own the EV-charging business, one way or another. Only for them, it makes economic sense, as only for utilities kWh are not cost, but profit centers. They have the time horizon and patience to wait while the private CPOs and EV OEMs roll out their networks and go bankrupt, and then scoop them up on the cheap. The market will leave relatively small niches for other models. Charge point service companies can make good money maintaining and repairing charges for private clients. Software companies, mapping free working chargers in real-time have a future. Off-grid charging and mobile charging will find their niches. And, of course, the charging equipment OEMs will make money as usual. All these could be good businesses, but none will be able to beat the scale of the utilities charging business. Moscow rules Two years ago I didn’t have this kind of clarity about EV-charging business models when I was standing in Moscow City. I had a nagging thought that something didn’t add up in the model. But this wasn’t what made me turn down the offer. In Russia, we have this slang word otzhat’ a business, meaning to squeeze someone out of their business without paying them a fair price. I was sure that sooner or later the Russian grid monopoly would do exactly that to all CPOs. If I would get lucky - I would get away with some meager compensation. If not - I would end up in jail on some trumped-up chargers (pun intended). That was the last time I visited the Moscow City district.

Imagine transforming your energy system into a goldmine. That’s the vision behind Virtual Power Plants (VPPs), and it’s not just a pipe dream. As the world leans into the renewable revolution, savvy investors are eyeing VPPs as a promising avenue for substantial returns over the next decade. Events like last month’s battery surge in California will soon become common, thanks to established technologies, new business models, and the power of AI.  So, let’s dive into why VPPs might just be the smartest addition to any Greentech fund portfolio yet. The new (fast) kids on the block VPPs rely on a vast array of new technologies. These technologies have several common factors: they are digitally enabled and have minimum rotating parts. VPPs are ill-suited to a conventional grid, running on bulky combined heat-and-power plants, or nuclear reactors. Key to VPPs is the speed of dispatch of an energy source or energy consumption unit. Rotating turbines of most conventional power-generating technologies take time to power up or down – anything from 20 minutes to a couple of hours. On the other hand, lithium-ion batteries, solar panels, and smart thermostats, managing your electrical heat pump, can respond within microseconds to electronic signals. Yes, in my backyard Another key factor for VPPs is the existence of distributed and largely unmanaged power sources. If you own a gas-fired turbine, you will pay a lot of attention to how and when it’s working. If you own a solar panel, most of the time you don’t think about it. This combination of power sources and power-consuming devices that could be managed every second, but are largely left unattended by their owners makes the existence of VPPs possible. The groundwork is done These enabling technologies are called the “smart grid” technologies. It is widely known that you can only manage what you can measure, so it is no surprise that the core of smart grid technologies are smart meters. These devices continually measure not only energy consumed, but also energy generated. Their readings are wirelessly transmitted. Other smart grid technologies include smart thermostats, batteries, solar panels, and digitally enabled substations. These technologies have been heavily invested in the last decade, laying the groundwork for demand response and VPPs. Demand response So, what is demand response? It is an immediate adjustment of consumption or generation of energy in response to changes in grid loads. The most primitive form would be a system operator issuing a warning of energy deficit and asking large consumers to limit their consumption in certain hours. The advanced version would be electricity tariffs, differentiated by the time of day. The VPPs however, are a whole new game in demand management. VPPs VPPs take advantage of millions of smart grid devices to manage energy generation and consumption. The owners of these devices agree to let VPP control them in exchange for a small fee. The VPP in turn regulates energy generation or consumption through algorithms, leveraging the time differences in energy prices. AI: The Steroids for VPPs Perhaps the most thrilling aspect of VPPs is their use of AI. This isn't just automation—it’s innovation. AI in VPPs handles complex decision-making processes that adapt to market conditions instantaneously, ensuring optimal operation across networks. It’s like having a supercomputer for an investment partner, one that knows exactly when and where to sell energy for the highest return. I believe that VPPs have all the potential to be the largest and most impactful AI applications in energy transition. Asset-light step The VPP model is a new utility model that is not based on owing generation or distribution assets. It is thus much less capital intensive. Thus, it presents a great opportunity for outsized returns in investments. Most of energy transition technologies require high upfront investments and rarely have a clear business model (just look at the EV-charging business). In this case, the required investment resembles your usual VC tech investment, where all you need is a team of geeks who can deliver. Time to place your bets As the energy sector evolves, VPPs stand out as a cutting-edge investment that offers both profitability and a badge of sustainability. They’re a testament to how technology can transform traditional industries and provide investors with exciting new opportunities. If you’re looking to diversify with something that promises to be at the forefront of technological innovation, VPPs deserve your attention.

In 2021, I was running a lithium-ion battery manufacturer, when the chips crisis hit us like a freight train. What used to take 1-2 months for chip delivery suddenly stretched to a painful 9-12 months, forcing us to delay our projects. It was a stark reminder of how critical these tiny things are to almost everything we do.   These memories came back last week, as I listened to a podcast featuring Tim Ferriss and Matt Pottinger, the former US Deputy National Security Advisor. The discussion turned to Taiwan, and Pottinger's message was clear and alarming: China is highly likely to attack Taiwan within this decade. This isn’t just a geopolitical issue; it’s a direct threat to the tech industry because Taiwan Semiconductor Manufacturing Company (TSMC) produces 90% of the world’s chips. So, we're all riding the TSMC rollercoaster whether we like it or not.   Then I saw the news, which was just shy of being a year old: TSMC is investing over €10 billion in the EU to build a new factory dedicated to producing chips for the transport and industrial sectors. This is a rational move in future-proofing their (and also your) business. Here’s why:   1. The Reality High Impact Events: The COVID-19 pandemic and the Russian invasion of Ukraine are stark reminders that unexpected, high-impact events are very real. These events disrupt global supply chains and have far-reaching consequences. Now, unlike Black Swans, these are well known in advance, so it is essential to hedge against such risks proactively.   2. Anticipating Future Disruptions: The potential conflict between China and Taiwan is a clear and present danger. The tech industry, heavily reliant on Taiwanese manufacturing, must brace for possible disruptions. Diversifying production and investing in alternative manufacturing hubs are smart strategies to mitigate these risks.   3. TSMC’s Strategic Move: By expanding its manufacturing footprint into the EU, TSMC is not just hedging against geopolitical risks but also ensuring stability and resilience in its supply chain.   As someone working with investors and startups on a 3-5 year timeline, with a keen eye on where the money will flow in the subsequent 5-10 years, I find myself constantly accounting for these high-impact risks. Buying from a Chinese supplier? No problem, if you are just sourcing solar panels for your next project, but if your next 10-year equipment maintenance program or component supply depends on it? Not a good idea.   Risk hedging doesn’t come cheap. It reduces your IRR and complicates supply chain setups. Take TSMC – manufacturing in EU is not the cheapest way to make stuff. Still, some people I talk to seem to think that the COVID-chips-crisis-war-hottest days on record—all within a span of just three years—should not concern their 10-year planning. Well, good luck with that.   Instead of a Conclusion   Currently, I'm reading "Chip War" by Chris Miller. Although I haven’t finished it yet, the ongoing narrative feels very much like the current state of the tech industry—a battlefield. The race to secure chip supply chains, the geopolitical tensions, and the strategic maneuvers by companies like TSMC all point to an industry in the midst of a silent but fierce war. The stakes are incredibly high, and the outcomes will shape the future of global technology and economics. Not taking it into account in your daily life or your business, is akin to burying your head in the sand.

Each year Bloomberg New Energy Finance (BNEF) drops New Energy Outlook - an overview of where we are on the energy transition path and what should happen until 2050 to reach the Net-Zero Scenario (NZS). While no battle plan ever survived first contact with the enemy, it pays to have a battle plan and understand where you are now and what forces are at play. This article is a collection of the posts I've been writing this week, bringing together various themes from the New Energy Outlook 2024, such as the breakneck speed of the fourth energy transition, the emerging business of heat pumps, slow fizzling out of hydrogen and a huge question mark about carbon capture technology. The report itself has much more details about these and other aspects of energy transition. I’ve highlighted in this text the ones that I see most relevant to supercharging energy transition right now, rather than in a couple of decades. The Fourth Energy Transition: A Global Shift by 2030 I've been raving a lot recently about the rapid pace of energy transition, spotlighting countries like Turkey and trailblazing companies like Ørsted. These examples show that if you are tough and don't take any nonsense from oil and gas execs, you can quickly stage a renewable energy takeover. Now, fasten your seatbelts, because according to BNEF by 2030,  half of the world's electricity will come from solar and wind power.  That’s right, we're talking about a global shift happening in this decade. And the best part? This revolution will happen without any additional policies. Solar and wind are already competitive enough to lead the charge. But don't break out the champagne just yet. The BNEF report also lays out the Herculean task ahead. To hit net-zero goals, the power sector must slash emissions by 93% by 2035 and triple its capacity to 11 TW by 2030. That's a lot of ground to cover, and there's no room for complacency. Pumping Up the Heat One of the standout highlights from the BNEF New Energy Outlook 2024 is the rising prominence of heat pumps. These devices are set to be the unsung heroes of the energy transition. Alongside their flashier cousins, electric vehicles (EVs), heat pumps are set to abate 15% of all CO2 emissions by 2050. That’s right, these (literally) quiet achievers will help save the planet while you stay cozy indoors. Only wind and solar will avoid more CO2 emissions this decade, but let’s not get into a sibling rivalry here. BNEF’s classification of heat pumps as an “electrification” technology is intriguing, as simultaneously they also identify "energy efficiency" as a separate source of emissions reduction. Any experienced heat pump installer will tell you that the energy efficiency of a building is crucial when determining the appropriate heat pump system. It's like installing a state-of-the-art security system but leaving the front door wide open. Addressing potential heat leaks, fixing windows, and other efficiency improvements are necessary steps before installation. Thus, each heat pump installation inherently includes an energy efficiency upgrade. It's like getting a bonus feature without the cheesy sales pitch. The forecast is ambitious: over 500 million heat pumps by 2050, a tenfold increase from today’s numbers. That’s a lot of pumps! Despite this anticipated growth, BNEF currently doesn’t consider heat pump technology as mature as wind or solar. They remain expensive to install, and gas boilers continue to be the budget-friendly choice. Hydrogen: The Slow Burn Now it is the hydrogens’ turn. The report makes it clear that there will be a negligible amount of clean hydrogen in this decade, whatever the hydrogen boosters say. It starts growing from 2031 onwards, and only after 2040 will it contribute to a sizable 11% reduction in CO2. The total demand for hydrogen is expected to quadruple by 2050. However, this growth will take off later in the next decade as other technologies scale up more quickly. It's important to note that this forecast has been reduced by almost a quarter from the last BNEF forecast. As for hydrogen use cases, BNEF still holds out hope for hydrogen use in heavy transport, but in my opinion, this will never happen at any meaningful scale. This leaves replacing ammonia with green ammonia, energy storage, and some heavy industry decarbonization. The BNEF report confirmed my position on hydrogen - the hype is slowly fizzing out. CCS: A Long Way To Go CCS will remove 35% and 34% of CO2 emissions in the steel and cement sectors, respectively. However, cement sector emissions are still expected to rise by 27%, which is puzzling because cement made with CCS is already price-competitive with traditional cement. The power sector, however, will be the biggest contributor in volume, with about three-quarters of all CO2 reductions coming from CCS in power generation. That’s the message on CCS for 2050 from the BNEF New Energy Outlook 2024, estimating the total amount of CO2 captured by CCS at about 8 gigatons per year. Considering that current CCS volumes in power generation are essentially zero, it has a long way to go, but plenty of time to get there. However, there’s a catch. For CCS to be truly effective, it needs credible demonstrations of reliable point capture and significant cost reductions. The technology is still seen as costly and unproven at scale. Without a carbon price in some form, introduced fast, this will be almost impossible to pull off. Still, there exists an industry where CCS could establish a foothold now and “cement” its role as another commercialized green technology. Yes, you guessed it - it’s cement. Today, cement made with CCS technology is already price-competitive with traditional cement. Instead of Conclusion The BNEF New Energy Outlook 2024 paints a dynamic picture of the future energy landscape, highlighting significant shifts and emerging technologies that will drive the next phase of the energy transition. From the dominance of solar and wind to the rise of heat pumps and the potential of CCS, the report underscores both the challenges and opportunities ahead. If you’re involved in greentech as a startup or an investor, let’s connect and explore how we can drive these innovations forward together. Also, I am currently in the process of raising our pre-seed round for ETR - the heat-by-susbcription startup, and if you're passionate about driving the energy transition forward—or just enjoy investing in the future—I’d love to connect. Drop me a line, and I’d be more than happy to share our pitch deck with you. Who knows? You might just find yourself at the forefront of the next big thing in energy. And hey, you’ll have a great story to tell at dinner parties.

We now have two newly made hockey sticks - one for stationary storage (ESS) and one for the EV batteries. The ESS one was made with two parts. Find out what they are below. In 2021 the company I was running completed our first lithium-ion battery installation. It was just 300 kWh of batteries, stuffed in a 20Ft container. We’ve built it for an energy supply company, that in turn used it to provide load management services to a manufacturing plant. When the energy supplier announced another call for proposals the same year, we were able to drop the price by 30%. Mind you, at that time we just had around 200 MWh of manufacturing capacity, and that was making NMC cells, which are by far better suited for EV’s than for ESS, and are more expensive than LFP cells. Last year, according to the IEA, the volume of installed batteries skyrocketed to over 40GW of installed capacity. Going from less than 10 GW, it is an impressive 4x growth in a year. But don’t get too excited. To put this in perspective - it’s about 40% of the total energy capacity of Turkey. Worldwide, this is a drop in the ocean. The growth of the EV battery market was also impressive, but in this post, I want to focus on grid batteries. While the EV market was driven by technological innovation, growing scale, falling prices, and higher adoption rates, the market for ESS has a different story, albeit, tied to the EV and growth in installed renewable energy capacity. Here are the two main reasons for the hockey stick in ESS: Drop in battery prices due to output ramp-up for EV market. Co-location requirements for new on-grid renewable energy power plants, first of all, in China, but then in other countries as well. Renewable energy installations grew fast, and in some places reached the tipping point, where additional intermittent generation requires a balancing of the grid with batteries. So, the ESS segment is riding on the back of two great waves - EV and renewable energy.  With the expected tripling of renewable energy capacity by 2030, batteries would continue this growth at least for a couple of years. This “Tesla-like” acceleration is a clear sign that batteries are fast on the way to becoming a commodity. #ev #batteries #energystorage #ess #energytransition #renewableenergy

The world is heating up, and while we're all doing our part to cool things down, we've got a long road ahead. In the meantime, understanding which temperatures are merely uncomfortable and which ones are downright deadly is crucial. Let’s break it down. When the heat is on, our bodies rely on sweating to cool down. Sweat evaporates from our skin, taking heat with it. But what happens when the sweat can't evaporate anymore? Stay in this condition long enough, and you risk organ failure and death. Ever been to a sauna? You can handle higher temperatures in a dry sauna. But when your buddy pours water on the hot rocks, suddenly it feels like the temperature jumped a few degrees. This is because humidity makes the heat more dangerous. Adding stuff so that Lana can make a video. Enter the Wet Bulb Temperature (WBT), a metric that combines air temperature and humidity to tell you when the heat becomes truly hazardous. Here are some quick rules of thumb that I use: - 100% Humidity: Air temperature equals WBT. - 50% Humidity: Subtract 2.8°C from the air temperature to get WBT. - 0% Humidity: Subtract 5.6°C from the air temperature to get WBT. Now, let’s decode what these WBT numbers mean for your safety: - Up to 26°C WBT: Generally safe. - 26°C to 29°C WBT: Prolonged exposure or physical activity can lead to heat stress, especially for the elderly, children, or those with health conditions. - 29°C to 31°C WBT: Things get dangerous. Even healthy people can experience heat stroke. - Above 31°C WBT: The human body can't effectively cool itself. Spending too much time outside at this WBT is life-threatening. - Over 35°C WBT: Lethal. You won't survive long in these conditions. Let’s put this into perspective. Right now, I'm sitting outside in Istanbul. The air temperature is 27°C, and the humidity is 43%, according to my iPhone Weather app. So, my WBT is 27 - 2.8 = 24.2°C, which is within a safe range. In Sholapur, India, the air temperature is 39°C with 29% humidity, giving an approximate WBT of 33°C. If I were there, I'd be indoors with the AC blasting. Stay safe and enjoy your summer! And remember, knowing your WBT can be the difference between a fun day in the sun and a trip to the hospital. #sun #summer #climatechange #safety