Green Giants – Episode 58

Mats Larsson (00:59)

Well, I realized at an early stage, around 2005, that we can’t continue to rely on petroleum fuels for very long into the future, and we need to prepare for the change. And at that time, I realized, if we want to move to another type of fuel, to another type of transportation system, we need to really build the systems that we will need in order to run transportation in a different way. And these systems consist of many different subsystems like fuel production, fuel distribution, vehicle production, vehicle development, vehicle distribution, and so on.

So, we need to take care of all of those in order to change to a new transportation system. And we can’t just focus on the vehicles, the charging solutions. We need to take a broad view of all the aspects and manage the entire change across all subsystems.

Wes Ashworth (02:14)

Yeah, absolutely. I love just the way you think about that holistically and kind of just viewing the entire picture, how it all connects. And I think that’s what’s missed a lot of times. So, as I mentioned, you spent over two decades pushing for electrification at scale. What belief or insight has remained constant for you throughout that time? And maybe what’s the opposite, what’s shifted most dramatically?

Mats Larsson (02:36)

Well, what’s remained constant is this system’s perspective and the realization that, for example, the Apollo program wouldn’t have been successful if NASA had not managed all the aspects of the change and they had built a space center, launch ramp, a crawler, the vehicle that took the rocket from the vehicle assembly building up to the launch ramp, etc. So, without all these activities, the Apollo program would not have succeeded. And when we look at the transportation systems, there are thousands of different companies that need to be involved in different parts of the change.

And now that we know that we are changing to electricity, there are utilities and there are hundreds of them in many countries. There are providers that provide technologies for power generation, for power distribution, and for charging infrastructure.

There are operators of the charging infrastructure. There are vehicle providers, well, automotive companies, and there are a host of other types of players that need to be involved. Not only private companies, but also public organizations like municipalities, regional authorities, state governments in the US, and the federal government in the US need to take different roles.

And in order to do this, there is a need for coordination and for management of the change. Because it’s not only a matter of getting all these to understand what they are doing. They need to act and make investments, and conduct activities in a way that makes sense from the overall change perspective. So that has remained constant in my vision of the change.

What has probably changed the most in my view is the perspective of the fuels that may be possible. And at an early stage, I realized that electricity would be the only fuel or type of energy that could be produced on a large enough scale to fuel all vehicles on the planet. Biofuels, there’s simply not enough raw material to produce enough grain-based or cellulose-based biofuels to make it possible to run all transportation on any of those.

So, electricity is the only one, and I realized that at an early stage, but I have become even more convinced of this as we have made progress. And I have also realized that hydrogen, which is often seen as an alternative to electricity or even a way to charge using electricity, because hydrogen is produced using large amounts of electricity. Hydrogen could not be used on a large scale, as far as I understand, because so much that there is such a need for large amounts of power to produce hydrogen that we could not realistically build the power generation necessary to produce hydrogen to fuel all transportation.

I wouldn’t say that this has changed dramatically for me as a person, but it has changed dramatically in terms of the view of the automotive industry and sustainability advocates, and other people who are interested in the change. Because when I started out to analyze the change, most people believed that biofuels would be the future. And even Volvo Trucks, which was at that point the leader outside of China in the heavy trucks industry. They developed seven different engines for trucks based on biofuels.

At that time in 2009, none of these engines were electric in any way. So, they developed seven different engines that could use biogas or ethanol, methanol, and different combinations of biofuels. And they didn’t at that point realize that electricity could be used to run trucks as well. But that has changed a lot since then. And that has changed for me as well because I believed at that time that, well for heavy transportation, we will have to stick to either petroleum fuels or perhaps to some type of biofuel.

Wes Ashworth (07:36)

Yeah, absolutely. Really, a lot of great perspective in there, and I would agree with it. I would say I’m not a chemical engineer. I did talk to one yesterday who agreed with you on the hydrogen point. But I do think we’re seeing some, like very specific use cases and applications, where those absolutely do make sense. But when you’re talking about at scale, just electrifying all vehicles, fueling all vehicles. I agree wholeheartedly with all that you shared there.

I want to, I’ll come back to it. really want to dig in a little bit to the Apollo program parallel. I love that parallel, but I want to focus a little bit, just quickly, on the Global Energy Transformation Institute. Just kind of what went into it, how it was founded, and then how you describe the core mission of it to someone hearing about it for the first time.

Mats Larsson (08:20)

Well, the core mission is developing the ideas around orchestrated change or managed change of the transportation systems. Transportation systems for cars, heavy vehicles, for goods, and for people in buses, and so on.

There are so many different aspects that need to be taken into account when we are planning the future for those. Aspects that have not so far been widely recognized by most experts and by decision makers who think that we could simply ban the sales of new petrol and diesel vehicles by 2035 or by some date in the future. And then the market forces will take care of the rest. So, the mission that I’m trying to accomplish is to inform people of the need for management and for support in various ways for this change, and also to run projects where we make these needs apparent.

Wes Ashworth (09:32)

Absolutely. So, I do want to go back to the parallels between the Apollo program and the Marshall Plan. And you often draw on those parallels, I think, is really fascinating.

When you said it, I immediately was like, gosh, that makes so much sense. I hadn’t had anybody make those parallels before. But talk to us a little bit more about that. Like what specific lessons do you think we need to take from those efforts today? And digging into that more in terms of the parallel and why you’ve made those claims?

Mats Larsson (09:57)

Yes, basically, a lot of development has been run and has been achieved over the past decades without any managed change programs. But there has been a lot of public investment, in particular, in many of the most important technologies we use today the US government has invested heavily in the early stages of development like computers where the US government financed a lot of the development from the end of the Second World War until the 1970s, 1980s and the internet where the ARPANET was the basis for the internet and the technologies developed to run the ARPANET were then applied on a larger scale to make the foundation for the internet and so on.

And there are many other examples where government financing has been necessary. But in these cases, like computers, there’s never been a deadline. No one has ever said that by this particular year, we will change to this type of computer or run the world on this particular technology. But in this case, with the change, there is like John F. Kennedy realized in 1961, and he challenged the nation to send a man to the moon and bring him safely back to earth. And he said the date that this must be accomplished by the end of the decade. And that created a need for management. Because doing all this in nine years required a lot of planning, a lot of management, and NASA had to take the overall responsibility to make sure that all the activities, all the development steps were undertaken that were needed to accomplish all the different developments of materials, technologies, solutions, miniaturizations, the vehicles involved, the spacecraft involved and so on.

So, in order to do that in only eight or nine years required a huge amount of management and coordination of the activities. And we’re in a similar situation now when governments across the world, the EU, national governments in Europe, air regulators in California, they are saying we need to ban the sales of new gasoline and diesel vehicles from gasoline and diesel cars from 2035. If we want to accomplish that, we need to develop the power infrastructure to a certain point because we would need much more power in order to fuel all vehicles using electricity instead of petroleum. And we need a lot of charging solutions, and we can’t just select any charging solutions that happen to be the best ones for the short term. We need to think ahead and say what charging solutions we need when the majority of cars are electric. Can’t we really charge all cars while on road trips across the US or across Europe?

Can we really charge all cars in the summer, during the summer driving season, standing still in stationary charging infrastructure? Or do we need other solutions? And we need to think about that now, because if we need other solutions, like battery switch solutions or electric roads, we need to start to build those now, because it will take not one, but probably two or three decades until we have fully fledged systems involving these types of solutions. We need to develop technologies and system solutions, and business models to go with them. So, there is really a big need for both analysis and to see what solutions we will need when the majority of vehicles are electric.

How can we implement those, and how can we expand access to new forms of charging, for example, so that we have them available once the majority of people have electric cars and electric trucks?

Wes Ashworth (14:34)

Yeah, such a great perspective. And again, that parallel to me paints such a good picture. And to me, it’s very accurate to where we are. And I think with that, we get a sense of vision and where you’ve come from. But I want to move a little bit into practical realities, just what it will take to actually execute a transformation on this scale, and where we are at most risk of falling short. So, in your opinion, what are the most underestimated technical and organizational challenges in the transition to electric vehicles today?

Mats Larsson (15:02)

I think the most underestimated challenges are the financial challenges and the scale of the implementation of the different technologies. Because in the US right now, and also overall in Europe, we have 3 % electric cars. In some parts, like California, there are more. In Sweden, Norway, we’re far ahead of the rest of Europe, but overall, we have 3 % electric cars. We have less than 1 % electric trucks. So, this change to electric trucks, at least heavy trucks, is at a very early stage. So, no country, I’d say, perhaps not even Norway, that is the leader in this transformation.

No country has experienced a situation where the majority of vehicles are electric. And we haven’t experienced a situation where there is really a big demand for electricity to fuel all cars. Because in Europe, about half of our electric cars are hybrids with relatively small batteries. we have even perhaps less than 1.5 percent fully electric cars at present, and about 1.5 percent hybrids that are run on petroleum most of the time.

For example, Elon Musk has calculated and he said in an interview at the conference CodeCon 2021 that in order to charge all vehicles in the US, drive them on electricity, you’d need to double power generation. And that means 4,000 new terawatt hours of power needed in order to fuel all cars, probably also to produce batteries, and so on.

And for Europe, we need about half of the current power generation in order to run all our vehicles on electricity. So that’s a huge amount. There is no way to get around it. can’t just say, probably we’ll need, well, electric vehicles become more efficient in the future, and they’ll need less electricity because electric motors are already 93, 94, 95 percent efficient. Well, the amount of electricity needed is not likely to decrease. We can perhaps build more powerful batteries, we can build smaller batteries, being able to hold more electricity per unit weight, and so on.

We will need an amount of electricity in the future in order to fuel all vehicles using electricity. And that is a really important realization. So, we’ll need huge amounts of financing, and there will have to be very big activities in terms of reinforcement of power grids, expansion of power generation, and expansion of charging infrastructure.

So, don’t think most people or most decision makers have realized the amount of money that will need to be invested in order to build these systems and to reinforce and expand different parts of these infrastructures. And I think that will be the biggest challenge to actually get people to accept that this will be necessary to get investors to put in the money and to start enough projects and to start enough investment programs to make this possible because it will be much more it will require more financing than even the Apollo program, I think.

Wes Ashworth (19:11)

Yeah, wow. Yeah, really interesting insights there. It really just makes you stop and think and gives you a great perspective. And you’ve shared this a couple of times, but you’ve said that without the coordinated transformation programs, the electrification effort risks stalling. You’ve already shared a few things, but any other sort of like, can you explain what those programs would need to look like? If we were set up for success, what would that need to look like?

Mats Larsson (19:33)

Yeah, that’s a tough question. Because I don’t think so many people have really considered what they would need to look like. I’ve done some thinking, and I think there will have to be a structured change, managed change on different levels. Governments need to take a leading role because they need to determine how much different types of systems will need to expand. They need to communicate this to the different players, and there is no need to make these types of overall calculations in many places. They could be made in Washington, or in Brussels, or at least in each of the European capitals by governments or government agencies.

But then, doing this and managing this change, different authorities need to be involved at the state level, regional level, and at municipal level. And municipalities, for example, need to take some responsibility in planning and identifying areas in cities and towns where charging infrastructure could be built. They need to communicate with utilities to make sure that we get enough electricity to this and discuss how much power generation would need to be expanded, perhaps not on the municipal level for power generation. That could be on the state level or some other, some middle level, but power grid capacity locally, et cetera. That needs to be coordinated. And we also need to make sure that different companies that will invest in charging infrastructure know about the number of chargers that will need to be built, and so on.

And that seems to be a really tough challenge to solve how to actually make all these investments happen in such a short period of time considering the number of different organizations, companies, individuals, mean families that need to buy vehicles and cars and companies that need to buy vehicles and companies that need to invest in charging infrastructure and so on.

While coordinating and making sure that all of these parties with different agendas, different financial situations, etc., are actually prepared to do their part, or estimating how many will be. So, in case we find that only half the households can afford an electric car, and there will not be enough used cars rapidly enough for people with lower incomes to be able to buy those. How can we then facilitate the change and make it possible to move forward? If not, all utilities are able to make the investments in the reinforcement of power grids. How can we support them to make this happen, and what types of support will they need, etc.

Wes Ashworth (22:45)

Yeah, no, it’s good stuff. And another piece of this that we’ve touched on is that you’ve done extensive work on the logistics side of electrification. And I want to know, what did you learn from your analysis of the Swedish logistics hub that surprised even you?

Mats Larsson (23:01)
Yes, we did an analysis last fall of the Swedish logistics hub here in southern Sweden. We’re only 10 million people here. So, we need many fewer goods here than compared to what you do in the US. We’re a long country from north to south. So, a lot of the goods that are transported by truck come in at the southern part. So, 80 % of our fruit and vegetables that are imported to Sweden are imported via a town called Helsingborg and a particular logistics area there, where these are transported into logistics centers and are reloaded to be distributed further up north in Sweden. And there are at this center, even though we’re only 10 million people, there are 1,400 trucks every day coming into this logistics hub, and they are, at present, diesel trucks. All of them are heavy trucks. And we have 24-meter trucks. That’s about 70 feet long trucks here in Sweden. As opposed to the rest of the EU, where they have 18-meter trucks. Amounting to about 53-54 feet.

I think. So, we have larger trucks, but still, we have 1,400 trucks visiting this area. And only one of those trucks at present, or at the time we did this analysis, was electric. But over the coming years, the EU has decided to rapidly phase out diesel trucks. Automotive companies need to sell more electric trucks. Logistics companies and transportation companies need to buy them. And they need to implement them. According to the plans, a lot more electric trucks will be used over the coming decade by 2035, 2040, and a large share of all trucks used will be electric. So, of those 1,400 trucks, maybe in 2035, half of them may be electric or more.

What we found is that if we want to continue to run transportation systems, in the same way as we’re doing today, with short stops and a high rate of utilization of vehicles. That will require very large, very high capacity for charging at each point for each truck. And trucks that are charged at high capacity need much more capacity than most other uses of electricity. One truck that’s charged at 300 requires twice as much capacity as 100 dishwashers or 100 heat pumps. So that’s a huge amount. And the transportation industry they are thinking in terms of charging at one megawatt, which is three times the capacity of the 350 kilowatts that I mentioned. So, 1 megawatt is a huge amount. Actually, the top load, the peak load of electricity on this logistics area, was 11.9 megawatts. So, 12 trucks charged at 1 megawatt would require as much capacity as the entire logistics area, with 19 logistics centers and 1400 trucks visiting every day requiring a present.


So that’s an almost unimaginable amount of electricity that’s needed only to charge a small number of trucks, in case we would like to charge them very rapidly, so that we could get, say, 200 miles of range in half an hour of charging. So, in order to charge to drive 200 miles, you need to charge for half an hour at one megawatt. So, if we would like to continue to run our transportation systems, the amount of electricity needed would be very, very high. And simply not that amount of electricity or grid capacity available at present. And it will be difficult to expand ahead of demand because utilities are not allowed to invest unless there is a customer order some type of, or unless a customer has ordered or asked for an expansion of their subscription, utilities are not allowed to make an investment in reinforcing the grid at that point. They can do so to a small extent, but not across the board, like in many places where expansion or reinforcement will be needed.

So that was one of the big learnings from this project that if we want to have transportation systems in the same way as we are doing today with short stops and high utilization of vehicles, which leads to low costs of transportation for customers, we need to make huge investments in the power grid capacity and power generation in order to supply enough electricity. If we’re not prepared to do that, and if it turns out that these investments are too big to actually be viable, we will need to rethink how we transport things and how transportation systems are designed today, and how vehicles are utilized, and so on.

Either big changes will be needed in the utilities industry and or big changes will be needed in the transportation industry, depending on the level of investment that will be needed in order to achieve the changes that will be necessary.

Wes Ashworth (29:45)

Yeah, and thinking about just those investments and some of the innovations that are coming that could accelerate or redefine the road ahead. What are some of maybe the most promising technological innovations on your radar that could accelerate this transformation?

Mats Larsson (29:59)

Yes, think electric roads are a really important and potentially very promising innovation. But large and extensive systems of electric roads with extensive installation of tracks in the road surfaces will be needed so that vehicles can charge while driving. If we had those roads across big geographies, we’d be able to charge while driving, and we could reduce the number of hours that would be needed for charging overall. And if we put a cost on the hours that would need to be used for charging, in case we have to do stationary charging, we will find that the cost of charging in stationary charges will be very high. For companies, it’s obvious that there is a cost. For truck transportation companies and so on, it’s obvious that they have to pay the driver, they have to pay for the vehicle, and they may have to increase their vehicle fleets

by a number of extra vehicles, say by 10 % in order to make up for the time that will be used in order to charge in stationary charges. But for private citizens, it’s not as apparent that there’s a cost connected to us charging. If we are driving in the summer over long distances, we’ll need to stop to charge, maybe every 200 or 300 miles, depending on the capacity of our batteries. There’s a cost to that, there’s a need. There is also a cost to accommodating the size of the charging infrastructure to peak demand.

So, if at some point in say July, there is a peak demand on a certain motorway where that only happens a couple of times on Fridays when a lot of people hit the road to go somewhere. Then we need to build enough chargers to cover the need at that point or at that time along this entire road. So, every 50 miles or so, there will have to be enough charges for people to be able to charge even at these times when demand alternative could be to install or build electric road systems on a large scale. And then all cars that have the opportunity to charge while driving, if we need to install these appliances.

So, we could charge while we drive, and we could just increase the amount of electricity that is fed into the charging tracks in the road at each point to cover the peaks. So, there are a lot of advantages, and it could potentially reduce the cost over the long term, but the investment for the short term will probably not seem as if it will be worth it because at present when we have few electric cars, few electric trucks, it will not be as apparent that we will need those electric roads, but when electric car fleets, electric truck fleets increase and grow, a lot of people will experience that waiting time at charges or that they will reconsider perhaps, say, we shouldn’t go on vacation this week because there will be so much pressure on charging infrastructure. We could go next week instead.

So, people may have to adapt their behavior and their planning to the availability of charges and charging capacity if we do not have electric roads.

Wes Ashworth (34:04)

Sure, yeah, really good insights there, and just perspective thinking about the future. It’s hard to think that eventually it won’t happen, right? I think, you know, obviously it’s such a small percentage now of electric vehicles on the road, but those percentages are ticking up every year, you know, and going up every year, and eventually it will become a necessity, you know, a problem that we’ll have to solve. But nice if we could get ahead of that and think about it. But it’s a part of whatever we do, you think about, and it’s maybe a lot, it’s a lot simpler but cell phones and you think about okay well now there are chargers literally everywhere and you go to the airport and you set the thing on your armrest of your chair and it’s charging your phone and just how that’s evolved quickly and it’s hard to think you know with EVs it’s going to follow the same sort of evolution especially as the necessity increases is what I would think.

Mats Larsson (34:59)

Yes, actually, I think at this point, many people who have electric cars have another gasoline car as well. Because I have one that I use when I want to drive long distances, or if I want to pull a trailer, I use my gasoline car. But in the future, gasoline cars or diesel cars, as we have in Europe as well, will be banned. We will not have the opportunity to have a second car that’s not electric. So, all the situations where I use for convenience a gasoline car for convenience instead of my electric car, I will have to use an electric car, and that will put pressure on both drivers to actually adapt and to set aside time for charging. And that would put the pressure on operators of charging infrastructure and the governments, et cetera, to make sure that there’s enough capacity for charging for the number of vehicles that need to be charged, even at peak times.

And there are places already where the demand at some points over the year is much higher than the availability of chargers.

Wes Ashworth (36:14)

Absolutely. With that, I’ll transition a little bit, just as we come up on time and close into just looking further into the future and into the consequences of our actions or inaction. I’m thinking about that. So, what happens if we get this wrong, and what does success look like if we get it right? So, if we fail to meet our sustainability goals, what scenarios do you foresee playing out in terms of energy security and economic instability?

Mats Larsson (36:36)

Well, there is more than one driver of this change. We have primarily become aware of pollution and CO2 emissions, but there is also the aspect that oil production may come to a situation where we reach a peak, and the oil volumes will go down after that peak.

So, we may have less oil in the future than we have today, and the decrease in oil production may be steeper than we expect. Because already a number of countries, not the US, but other countries like Norway and the UK, and many others have experienced peaks, and they have seen the oil production decline over the past three decades. And Norway and the UK actually have produced less than 50 % of the amounts that they did at their peaks. So, we need to plan for this. And the worst case scenario may be that we see oil production go down without having enough resources prepared to change rapidly over to electric vehicles and we may see that we can’t transport the amount of goods that we are used to, people can’t go to work using their car in the way they’re used to because we don’t have enough gasoline or diesel in order to run transportation the way we are doing today and we haven’t perhaps invested enough in the expansion of electric transportation systems to make them prepared to take over large amounts of present transportation work.

Wes Ashworth (38:20)

Yeah, absolutely. And I think too, we’ve talked about this on the show many times, but now with the increase in demand, you know, with AI, with data centers, with electrification of everything, with, you know, reshoring manufacturing and all those kinds of things that come into play, we’re going to need more, and it’s oil is not enough and it’s a finite resource, it’s all of those things as well too.

And you think about how important energy is to your life and your livelihood and everything that you do in our economy and security and all those things that play out, it’s probably the single most important resource on the planet. And so, this is a problem we have to, you have to solve, regardless of whatever political view or country you’re in or what have you, it’s collectively coming together. And I love that, again, those analogies of the Apollo program and those sorts of things, of kind of like, hey, what are we doing? Let’s come together, find solutions all work together. It requires every piece of the puzzle to make it happen. yeah, I love all of that.

Mats Larsson (39:21)

Absolutely. You mentioned data centers, and there’s at present a surge in demand for the capacity of data centers, and there’s for AI, and there’s a surge in demand for electricity to power those data centers. So, there is already an increasing demand for electricity, but not coming from the transportation area. And this, even though this data center demand will only increase electricity demand by 1 % compared to today, the suppliers of equipment for generation, for power grids, etc. They are experiencing a boom in demand, and they’re expanding like mad at present.

These producers double their production only due to the increasing demand from data centers. And to fuel electric cars with electricity, we would need 50 times the electricity that we now expect to be needed for the data centers for powering AI so 50 times that and even with the increase for AI and the power industry or the power equipment industry is experiencing this boom and they are well expanding in any way they can in order to meet demand.

So, what we’re looking at in the near future is a really a real type of boom in demand for electricity and for electricity equipment and so on that we probably have never seen in any industry or in any type of environment before. And despite this big need that we can see on the horizon, as it’s created by government decisions to a large extent, there is no planning for this, there is no initiation of or starting up of training programs for electricians or project managers for power generation or power distribution projects or for what I often call electrification strategists or electrification architects that will be needed for the expansion of the infrastructure for power distribution and for charging and so on.

So, there will be a big need for competence and for competent individuals in these areas. But there is so far not very much planning to actually satisfy those needs.

Wes Ashworth (42:10)

I agree completely and am thankful for your work that you’re doing, books that you’re coming out with, and your work just in your organization as well too and helping to spread that education. And part of why we do this podcast is just getting as much out there as we can, making people aware. So, final question, imagine it’s the year 2045, we’re going 20 years in the future. What would success look like to you then, and what do you hope your legacy will be in that future?

Mats Larsson (42:36)

Well, success would be if we, at that point, can say that we’ve managed this change and that we have well-balanced systems for charging and for power generation, power distribution that have supported the change throughout these 20 years in the way that I, we could mention the Marshall Plan.

The Marshall Plan was closed down a year ahead of its intended final ending because it was so successful that it had already achieved the goals that were intended when they started the plan. So, that would be a type of success that we would, that we cannot expect to experience in this case, I assume, but at least being able to meet the needs in 20 years and say that we have run this expansion over the past two decades in such a way that we have foreseen the different needs, we have been able to cater to the needs for, well, the different types of resources and we have planned for the competence development, we’ve planned for the expansion of companies and industries that would be needed and so on. And we could look back on this development and say, we’ve really done a good job in planning this, like NASA could do when they sent a man to the moon in 1969 and got him safely back.

Wes Ashworth (44:11)

Yeah, with that great closing, just sentiments and vision there, and thinking about the future. So, with that, we’ll wrap up, and Mats, thank you so much for coming on the show and sharing your insights with our listeners. I hope it gave you both a sense of urgency and looking at the opportunities ahead. Mats makes it clear that if we want a sustainable future, we can’t treat it as a patch job. It’s going to take new rules, new models, new thinking, and above all, a shared sense of mission.

If you found this episode valuable, which I’m sure you did, please leave a review. Share it with someone in your network and help us get the word out. Thanks for tuning into Green Giants, and we will see you soon.