YouSaid · the spoken record

Jake Schmidt

lines on the record: 20
first: 2020-01-10
most recent: 2020-01-10
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“I would say for me the most surprising factor has been how underinvested the CO2 sequestration technologies have been. If we take carbon capture use and storage, which will be an absolutely key technology if we want to get to net zero carbon, they've only received less than 1% of the investment in solar or wind have received. And the reason is that there hasn't been enough broad and high carbon pricing to incentivize those new technologies. I would almost call the last decade the lost decade for CO2 sequestration. And I think that needs to change in the next 10 years.”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“Big oils can hit an attractive balance. We are on one side they continue to enhance the cash return to shareholders and on the other side they substitute an underinvested amount of money into traditional oil and gas with new attractive opportunities in renewables, in sequestration and in low carbon solution and in that way we actually believe they can lower the carbon intensity of their energy sales by 10 to 20 percent over the next decade while enhancing corporate returns.”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“Now, investors in the energy sector sometimes are just looking for return of capital, and some of those energy giants have been great returners of capital through both buybacks and dividends. Doing the kind of investment you're talking about will require redeploying some of that capital. How do investors feel about that?”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“The top questions from investors is the role that the energy industry and particularly big oils will have in decarbonization. Are they drivers of change or not? And we have delved into this issue in our reimagining big oils report where we really think about how that business can transform to enable lower carbon emissions in the future. And we believe they can. And their balance sheet and their risk manage capabilities can have a key role in enabling a broader uptake of low carbon solutions, particularly in power generation and mobility, and we'll also have a key role in funding some of the key emerging sequestration technologies.”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“Difficult to say, I think Europe is very keen to achieve it. And under the new European Commission, we'll certainly push its global peers to think about broadening and increasing the carbon price to accelerate the decarbonization process.”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“At the moment, every government, every country tends to have different incentives for low-carbon technologies. And some of these have been very successful, particularly in areas like wind, solar and batteries. But it's been inconsistent. I believe that it would be much better to have a broad technology agnostic CO2 pricing that would actually help achieve a better technological innovation in the coming years.”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“Obviously, it's a sector like our own that's heavily regulated. How would you characterize, it's hard to sum it up in very quick terms, but how would you summarize the kind of regulation that we're seeing around the world and where's the directional flow of that regulation?”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“I think you're absolutely right. It will mean less innovation, less investment, and overall less production in oil and gas, which will drive higher oil and gas prices. But on the other side, I think these corporations will put more investment and more innovation and more top management focus on the low carbon solutions. And this mix of more focus on low carbon, but on the other side, higher oil and gas prices on the back of the underinvestment is what I think will help to accelerate the decarbonization process for the global economy.”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“So, this consolidation in the industry, as I said, it's always been an industry that's favored big scale, can sometimes lead to less innovation and a little bit less investment. What is the market structure going forward for this industry mean for innovation and for new investment”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“Absolutely Jake. As we look through the oil and gas industry, the tightening of financial conditions is creating higher barriers to entry and is incentivizing consolidation to the point that we believe we are seeing the resurgence of what we call the new Seven Sisters, seven large oil and gas companies that like in the 50s and 60s dominate all large scale new hydrocarbon developments and this we believe is creating a better industry structure for energy and is creating higher returns for those companies”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“We look at the financing of hydrocarbon assets, we believe that the financial conditions have tightened so much that we're actually now into a period of structural underinvestment in oil and gas, which will mean that the way the decarbonization process will work, particularly in the next 10 to 20 years, is likely to happen through higher commodity prices, not lower commodity prices. This is actually a perfectly rational thing to happen because it achieves two key aims. The first one, to continue to incentivize the consumer to find the low carbon alternative to the energy use. And the second one, it avoids a buildup of stranded financial assets that could be destabilized into the global economy in the long term.”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“Capital markets have become very involved in climate change, and we actually think they are currently being one of the key drivers of change across global corporation. If we look, for instance, at the climate change holder resolution since 2012, they've doubled. And the support of shareholders has tripled over that time period. And this is forcing corporates to really incorporate climate change into their risk management, into their investment outlook, and into how they think about their business developing in the future. It's also completely changing the way that financing works in the energy industry with new attractive avenues to finance low-carbon solutions. And on the other side, a very severe tightening of financial conditions on traditional hydrocarbon assets.”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“A lot of these technologies have been around for a little while, but obviously you say that investment hasn't really followed at the scale that's needed. What role are capital markets taking in financing the energy transition today?”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“I think we know the technology is there. We know it works, but we know it needs to be developed in scale to really improve its economics. I think carbon capture and storage is like where solar was in the 90s underinvested with tremendous potential, but without the ability to deliver yet economies of scale. And yet the following 20 years showed that prices could go down 80-90% on the back of scaled investment. And I think we will see the same in CCUS, including the opportunity which really would resolve”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“Carbon capture and storage, the technology's been around and there has been some investment, not as much as there might should have been. What is the early research shown in some of the early technological deployment shown about its feasibility and what will it take for that innovation to accelerate?”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“leave about 50% decarbonization is achievable within reasonable carbon costs, but then the cost curve becomes very, very steep, which means that we will need either of two things. Either a real technological breakthrough, particularly in things like battery and energy storage, or we will need sequestration. And one of the fascinating thing we have seen over the past few years is how little has been invested in CO2 sequestration, either through nature-based solutions like reforestation or technologies like carbon capture users and storage that can take back the CO2 from the atmosphere and either create materials with it or a store it underground.”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“So, when we look at energy, it's two key areas where we believe technology starts to be in the money. There is plenty of opportunity in power generation through wind, solar, and energy storage. And there are some really attractive opportunities coming up in mobility, particularly in city centers for buses, for passenger vehicles, and for shipping. And we believe this will be at the core of what could be a $1 to $2 trillion investment opportunity per annum over the coming decades if we want to reach net zero carbon.”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“So we have looked at almost a hundred different technologies across a spectrum of the economy, from mobility to power generation, buildings, agriculture, industry, to try to find out what are the key technologies that can help us reach net zero carbon emissions over the coming decades. And what we discover is that there are some amazing low-cost opportunities which will drive investment in the coming years, but that they may not be enough to get to net zero carbon, and that's where it's particularly important we continue to foster technological innovation. And also on the other side, we look at new technologies that can allow us to get back the CO2 from the atmosphere through CO2 sequestration.”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“Think as climate change becomes top of mind, it's very important that we find a solution for decarbonization that makes sense financially with the lowest impact on the disposable income for the consumer, the broadest technological innovation, and the most efficient financing. That's why it becomes particularly important to look at decarbonization from an economics perspective.”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT
“We'll see. Thanks, Oscar. Now on to the carbonomics segment of the episode here with Michele de la Vina. Michaela is the Commodity Equity Business Unit leader in EMEA for Goldman Sachs Research based in our London office. Welcome, Michael.”
2020-01-10 · Goldman Sachs Exchanges · How are “Carbonomics” Reshaping the Energy Industry? · IDENTIFIED FROM THE TRANSCRIPT