4-14-25 - 7am - AI Power Requirements & Coal

Episode Transcript

Speaker 1 (00:00):
Okay, Michael.

Speaker 2 (00:01):
So if I get charge of the federal crime, but
I don't have a real I d are they going
to be able to try me in a federal court
since I'm not allowed in there without a real ID.

Speaker 1 (00:15):
I don't look. I want to move on from the subject.
But what prompted it was in doing show prep over
the weekend. Of course, actually is a compilation of several things.
But I'm doing show prep over the weekend, and I

(00:37):
have to remind myself. Yesterday evening, we get back from
dinner with the kids, and I'm down in my office
and I'm putting my backpack together, and you know, I've
got to I've got stuff I need to bring here
with me for the program. But obviously there's stuff that
I don't want to haul with me to Chicago. So

(00:59):
I got to run back home and I got to
dump stuff out of my bag, and well, long story short,
for Norman, I wouldn't go back home, but I have
to go back home today for a reason before I
go back out to the airport. But I got to.
I had to remind myself, Oh, don't forget. You need
to take that certain thing that's going to get you
arrested if you don't take it out of your backpack.

(01:22):
So I was thinking through all of this stuff, and
then I got to I have a like a wallet
like thing that I carry my credentials and my Global
entry card, all of that stuff in one little thing,
and I've got that lay on my desk that I

(01:43):
got to put back in. And it made me think
about real ID. And so I go online and I
find this amazing amount of commentary about real ID and
I had not even thought about it until last night.
And some of the people that, some of the commentators

(02:03):
that I listen to that I have a lot of
respect for, or I shouldn't say I listened to because
I read them, are all apoplectic about people being upset
about real ID. And then there are people that are
that I would consider to be not nearly as libertary
as I am, that are looking at real IDA and

(02:24):
thinking to themselves, oh, this is wonderful. This is going
to protect us and make us safer, and really it's
kind of morphed now into it. They don't say this,
but when you read between the lines, they're pretty much
it's a tacit admission that a real ID driver's license,
because that's what it is. It's just a driver's license
that now meets federal standards. So a state issued driver's

(02:48):
license that meets federal standards. It seems to me there's
a little bit of a somewhat of a constitutional issue there,
but maybe so, maybe not. I didn't spend that much
time studying it. But nonetheless they're more than willing to
accept that. Now the real purpose of the real ID is, Oh,
now it has gone from national security to illegal immigration.

(03:13):
And I'm thinking, so, you've pretty much admitted that we
now have a national ID. It's just issued by the states,
but it's in compliance with federal law. And now they're
basically saying that it's federal law because the original reason
was because we didn't want to we wouldn't make sure
a terrorist didn't get on an airplane, which I find

(03:35):
hilarious because if you remember anything at all about the
nine to eleven hijackers, they were all clean skins. They
had no criminal background, they had nothing at all. And
considering today, especially today, they could go they could come
here from Saudi Arabia, and they could they could go

(03:57):
to the DMV in New York or California. I suppose
now you've been in Colorado and they could get a
real ID, they would be able to get on the plane.
Doesn't mean they could still bring their their bombs or whatever,
but they can still get on a plane. I mean,
it's just absurd anyway. There are there's also a lot

(04:17):
of stuff in the news lately about h a I
Artificial intelligence. Have you seen that stupid mean going around
dragon where they use chat GBT or one of them,
and they they make the little uh they're they're in
the plastic crimp things that toys come in, and their

(04:41):
little dolls that you make of yourself and the little
items that go with the doll or whatever your favorite
things are. Have you seen that one? No, but that
that's a real thing. You can make dolls of yourself.
I'm confused as to what you're trying to describe here.
He Well, apparently there's an AI pro where you upload

(05:01):
your photo and then you upload like what you want
your theme to be, okay, and so it produces a
photograph of you as a toy that you could buy
at a store, like a little g I Joe, Like
I would be like you know, you know, white button
down shirt with a backpack and a diet coke and

(05:22):
what would be my third thing? I don't know, a gun.
So I have a backpack of diet coca and a
gun and a button down shirt and jeans and sneakers on.
That would be me and the crimp toy. And that
would be the Michael Brown toy. I guess I'm puzzled
because this is not a new thing. So I guess. Oh,
I guess it's because it's a new thing, because it's
it's now AI thing. Okay, if you could actually buy that,

(05:45):
oh yeah, for for years. Yeah that's what if you
got me one of those for Christmas? Because I don't
care about you. Oh okay, it's obvious. Well, but the
three things I get for you, I mean you'd have
to have, like, you know, a a troll like beard, right,
bald head?

Speaker 3 (06:04):
Uh?

Speaker 1 (06:04):
You would have shorts on in your sneakers right, Uh,
some stupid T shirts, you know, stupid T shirt. But
what would be your three items? Crumble cookie? Come on,
you got Come on, what's the other two? Crumble cookie?
And what else? Maybe a video game controller? I don't okay,
see we're making progrests. Come on, buddy, you can do this. Okay,

(06:28):
so you got a crumble cookie, you gotta you got
an Xbox controller or something. And what's the third one?
Come on, come on, you can do the heck out
of me. Huh. Maybe a dumbell I don't know how to do. Yeah, okay,
yeah right, or a workout plan or something. Yeah, okay,
see that's okay. Now, now I get your Christmas figured out.

(06:49):
Well wait, wait, maybe I do, Maybe I don't. What
does that cost more than you want to spend? Oh
so it's more than ten dollars exact, then you ain't
getting it. So anyway, there are all these claims now
that artificial intelligence, as we've heard before, this is nothing new,

(07:11):
is going to take all of this power. And where
were we going to get the power? How are we going
to do all of these things that? Oh and by
the way, not only is it going to is it
going to take more power, but that's going to create
more climate change.

Speaker 4 (07:30):
One concern around artificial intelligence is it's voracious appetite for energy.
Electricity demand for AI focused data centers will quadruple in
the next five years at least, according to a new
report from the International Energy Agency, But the report also
calls claims that AI is accelerating climate change overstated. Tech
editor Peter O'Brien has been looking through all of this.

(07:50):
Now there's still quite a bit of uncertainty then about
the future of energy and AI.

Speaker 3 (07:54):
Yeah, that's right, Aaron.

Speaker 5 (07:55):
I've been looking through this this chunk here, and the
basic the takeaway is that, yes, energy demand from AI
is obviously going to increase significantly as we continue to
use it. But there are uncertainties, particularly around emissions. Is
AI going to devour so much oil, well, rather gas

(08:16):
and coal that it.

Speaker 1 (08:19):
Coal it's your lev our oil, you know, yeah, or coal.

Speaker 5 (08:26):
It's disastrous for our planets. Is it going to actually
increase efficiencies and spur innovations that allow us to reduce
emissions or is it going to fall somewhere in between?
And who better to talk about it than Thomas Spencer
who co wrote the report. Thanks for being here on
take twenty four and why do you think it was
so important to bring quite you know, close to the

(08:47):
front of the report that these claims that AI is
accelerating climate change could be overstated?

Speaker 3 (08:53):
Well, in the public debate, you see two positions being taken,
and they're quite different. The first one is that AI,
because of the technology innovation that it can bring, can
you know, in simple terms, solve climate change. And the
second is a more alarmist position that AI, because of
the acceleration and energy consumption, is going to dramatically accelerate

(09:15):
climate change.

Speaker 1 (09:16):
I love it. So AI is going to solve climate change,
but AI is also because it's going to require coal,
it's going to exacerbate climate change. By the way, when
we looked.

Speaker 3 (09:31):
Very carefully at the data, when we looked at the numbers,
when we did our analysis, we found that neither position
was really justified. What is important is that AI is
a tool, like any other tool. It's up to us
how we use it. It can help us on many
climate problems, for example integrating more renewables into our electricity systems,

(09:52):
but at the same time we need to manage the
electricity consumption growth that we are already seeing today. And
so we wanted just to let's say a little bit
of miss by let's.

Speaker 1 (10:02):
Don't gloss over that. Did you get what he just said?
So this is some tex expert talking to you know,
tech hour or whatever. On France twenty four the English
English version, so AI has this opportunity to solve climate change.
But because it's going to require so much energy, it's

(10:24):
going to exacerbate climate change, and that may interfere with
our current ability and our attempts to do what.

Speaker 3 (10:32):
We're integrating more renewables into our electricity systems.

Speaker 1 (10:35):
So we need to integrate more renewables as if that's
going to be a a persistent and consistent supplier of
power for AI. Hey guys, we got some great calculation
going on with AI, but hey, we just ran out
of electricity because well, look in Colorado today, it's snowing
in April. Shocker.

Speaker 3 (10:56):
But at the same time, we need to manage the
electricity consumption growth that we are already seeing today.

Speaker 1 (11:02):
But we need to manage the electricity consumption growth that
we're seeing today. This is precisely what the greeny Wien
He's the members of the Church of the Climate Activists
think that that's the solution rather than having a growth policy,
rather than having a growth agenda about you know, let's

(11:25):
grow and expand and become wealthier, and let's become more productive,
and let's become smarter and work smarter. No, let's regulate
how much electricity we use well, how does that, how
does that jive with AI?

Speaker 3 (11:39):
And so we wanted just to let's say a little
bit of misbusting with regard to these two diametrically opposed
to viewpoints that you hear in the public debate.

Speaker 1 (11:49):
Okay, so is it is it stabilizing climate change or
is it destabilizing climate change? Do we need to further
our use of electricity? Or can we just explain our
use of electricity?

Speaker 3 (12:03):
And when we looked very carefully at the data, when
we looked at the numbers, and when we did our analysis,
we found that neither position was really justified. What is
important is that AI is a tool, like any other tool.
It's up to us how we use it.

Speaker 1 (12:18):
This is gonna be up to us how we use it. Well,
I think you know one of the things that Trump
did last week was he ordered the EPA through another
executive order, to start deregulating the coal industry. Now, I
remember we were told by Joe Biden, remember when he

(12:39):
bent over at Staten Island or wherever the hell he was,
he didn't know where he was, and tell that little girl,
I promise you trust me. Look at my eyes, look
at my cold hearted by the way. You're really cute, sweetheart.
Look in my eyes? Can I sniff you're here? Well,
I'm going, I promise you I'm gonna get rid of
fossil fuels. Can I touch your neck? Can I remember

(13:00):
when Joe Biden did that? Coal built the power grid
of this country, and coal lifted millions into the middle class.
But somehow we treat coal as a dirty word, he taught.
Trump talks about you know that beautiful coal, beautiful clean coal.

(13:21):
And while we're sitting here denegrating it, Trump's trying to
change that. China builds more coal plants every single month
then we built in a decade. So have you ever
thought about why? If you want to assess coal fairly,
then you have to consider the history, the formation of
the current role, all the environmental impacts, the economic realities,

(13:44):
particularly compared with all of the heavily subsidized renewable energy
sources that they want you to compare coal with. So
Executive Order fourteen to two four one, signed last week
April eighth, Reinvigorating America's beautiful clean coal I left the

(14:07):
way he words these, reinvigorating America's beautiful clean coal industry
and amending Executive Order fourteen to two four one. The
purpose simply to bolster our coal industry through regulatory adjustments,
enhanced infrastructure support, and strategic economic initiatives. So let's think

(14:28):
about the formation and the finite nature of coal. Coal
is a combustible sedimentary rock formed predominantly from ancient plant
material that accumulated in swampy environments hundreds of millions of
years ago. As the plants died, they got buried under
layers of all this sediment. They became subjected to all
the heat and pressure over all these geological eons, and

(14:50):
the process transformed them first into pete, then lignite, and
eventually into higher grade coals like bitominus and anthracite. The
presence of abundant planet fossils of plant fossils in coal
seems to provide unambiguous evidence of coal's biotic origin. So,

(15:14):
unlike the ongoing debate surrounding oil and gas, it's of
a biotic origin. Fossil fuels are not from dinosaurs. The
evidence suggests that they are the remnants of past living organisms.
It's important, I think, to recognize that, regardless how much

(15:36):
coal we currently have, coal is not a renewal resource
on any meaningful timescale. The same geologic processes that form
coal took millions of years, far longer than the rate
at which we extract and burn it. So whether or
not we continue to use coal, it's virtually certain that

(15:58):
it cannot and certainly will not be replenished. In other words,
it won't be a major energy energy source in say
a century or two, simply because the supply cannot be replenished.
So if you're going to have any rational discussion about coal,
it should include that context that coal is not inexhaustible

(16:21):
and its future. You should be framed what as a
bridge to more sustainable, long term solutions. So when you
think about the Executive Order, some of the details I
think you ought to consider because it outlines clear policies

(16:44):
to enhance coal production and coal utilization. It identifies coal
is essential to meeting our increased energy demands. It mandates
removing all the federal regulatory barriers to coal production, and
it ensures that federal policies don't discriminate against coal. Doing so,

(17:05):
I think is racist. The Executive Order requires expedited coal
leasing on federal lands, and it lifts all the moratoriums
that Biden to put on coal, and then it prioritizes
coal related activities in order to maximize the accessibility and

(17:26):
the current utilization of whatever coal reserves we have left.
And then I don't know why if I find this
one interesting. It directs federal agencies to identify and promote
international opportunities for American coal and coal technology. In other words,
let's figure out ways that we could actually export this

(17:48):
natural resource that we have. I think part of the
reason for that is because it'll take a while to
if we're going to start reminding coal in this country's
going to take a while to ramp that back up.
P Then he also wants to accelerate development and commercialization
of advanced coal technology, including innovations in coal by products

(18:10):
like carbon fiber.

Speaker 6 (18:12):
Our Colorado legislature is trying to take away some many
of our gun rights. Over the weekend in Denver, there
were two stabbings. One was it twentieth in Pennsylvania and
the other was at sixth in federal What are our
Colorado legislatures doing about this?

Speaker 1 (18:29):
Well, I'm quite certain that we'll have, you know, they'll
introduce another sen up Billain will now have a permit
to purchase knives. We'll go the way of the United Kingdom.
So the last thing that this big, beautiful executive Order
on coal does is it instructs all federal agencies to

(18:53):
rescind any policy that discourages coal production or coal fired
electrical generation, and to ensure fair market competition among all
sources of energy. So that is a huge change in
both the tone and the policy toward fossil fuels, particularly coal. Now,

(19:16):
the real world impact has got to be considered along
the rise of a competing force in our energy landscape,
which is natural gas. Because the single greatest disruption to
coal's dominance was not renewables or green energy. It wasn't sole,
and it wasn't wind, it wasn't even government regulations. It's

(19:40):
a great example of how the marketplace, how a free
market works. The single greatest disruption of coal's dominance was
natural gas unleashed by all the revolution in directional drilling
and hydraulic fracking. So go back to the beginning of
the two thousands, those innovations directional drilling, hydraulic frycking that

(20:07):
unlocked all of the vast resources of shelle gas all
across the country, drastically lowering the price of natural gas,
which then flooded the market with what one of my
favorite phrases, cheap, abundant, and relatively cleaner burning natural gas.

(20:28):
And that transformation completely reshaped our energy economics. Power plants
increasingly shifted from coal to gas, not because of the
environmental regulations. Now, they did obviously because the regulations drove
some of that, but in compliance with the regulations, the
operators looked around and said, oh, we can easily do

(20:49):
this because we got natural gas. It was simple. It
was a simple cost benefit analysis, something that we don't
do now. Natural gas out competed hole and price flexibility
and in many cases emissions. Then with the with with
with the adoption of widespread fracking, that trans that just

(21:13):
utterly transformed energy production in places like Texas, Pennsylvania, North Dakota,
even Colorado. Of course, Dennick the Gout demonized fracking enabled
this country to become the world's top energy producer. But then,
because for a reaction, there's a reaction, it also introduced

(21:36):
new debates around water use, seismic activity, methane leakage, topics
that we've we've recognized and known about before there are
always trade offs, and again you have to do the
cost benefit of analysis to see whether not the trade
offs are worth it. And that context of the idea

(21:59):
that it wasn't government regulation, although it played a small part,
but instead it was a free market and it was
the you know, this is a let me just stop
for a moment. It just really hit me that one
thing that I'm missing in my notes is this. You
know how I talk about we get so panic stricken
right now over wind and solar battery storage, all of

(22:24):
the problems we have, and that fossil fuels right now
are still the most, the cheapest, abundant, and the most
efficient way to generate electricity or generate any sort of
energy that we need for everything. Growth in just growth
in evs, or just growth in more electrical appliances, more technology,
whatever else it is. This is an example of what

(22:45):
I mean about if we would just be patient, new
technologies come along and those new technologies disrupt the old technologies. Well,
that's besides what happened with coal. It wasn't government regulation.
Something better and more fish that was cheaper came along,
and what that was a result of horizontal drilling and

(23:07):
fracking and suddenly we're like, oh shazam, we've got natural gas. Well,
let's start generating. Let's let's transform our generation capacity from
coal to natural gas, and boom, now we've got you know,
a lot of electricity at a cheaper rate.

Speaker 6 (23:26):
Well.

Speaker 1 (23:26):
I think it's that context that raises a really important
question about this executive orders effectiveness. If keep natural gas
remains the primary driver behind coal's decline, then if we
just eliminate the regulatory barriers alone, is that enough to
reverse course for coal and for coal to once again

(23:49):
become maybe not dominant, but become another Really, Uh, if
we have a portfolio of energy production, can cold become
another part of that? Can coal once again become a
part of that portfolio? Now without addressing the dominance of
fract gas, government support for coal probably is going to

(24:13):
act more as a symbolic, a symbolic nod to energy nostalgia,
rather than any sort of lever for substantive change. But nonetheless,
when you have an energy market that has been warped
by very selective subsidies, regulatory discrimination, Cole's case for doing

(24:38):
something that I think is just as important. I don't
care if it becomes dominant or not, but it levels
the playing field among all of those things that we
have in the portfolio of energy sources. And if grid reliability,
domestic job creation, geopolitical energy and dependence, if you take

(24:58):
all of those things really seriously, then you've got to
realize that just including co in that portfolio, especially if
we're going to do a transition to nuclear power, then
you can't dismiss it, and you can dismiss the idea
that we really are transitioning to nuclear Nobody wants to

(25:19):
admit that there was and I didn't keep it, and
again I can't verify whether it was really true or not,
and I don't even know if it was in the
United States, but somebody had posted on one of the
social media sites. So when the wind turbines, when their
useful life expires, you know what they do with them.

(25:43):
They bury them. And it showed this huge mine or
what would you call it landfill, I guess is what
you'd properly call it, a landfill, in which these gigantic
cranes and these gigantic bulldozers were piling all of these
wind turbines into these neat kind of all laid parallel

(26:07):
to one another. All piled on top of one another
and then filling over with dirt. Wonder how long it's
going to take that to decompose, And I wonder what
kind of toxic metals that will leach into those landfills,
you know, once they cover it with dirt, and then

(26:27):
you start getting you know, the natural weather, and you
know there'll be rain and snow, hail, sleet, whatever, even
the heat from the sun, and it starts all leaching
through the dirt that covers the soil that covers that,
and it starts hitting those wind turbines. What's going to
leach from that into the groundwater or is that going

(26:48):
to turn into another you know, super fun site because
it's gonna become so toxic that you can't grow anything,
or do anything or build anything on top of those landfills.
Everything that I'm reading points to it's not being said
while it is publicly acknowledged that we need to streamline

(27:13):
and start building more nuclear power plants. I think that's
one of the real transitions that the Trump administration is pushing.
And I think just adding coal to our portfolio of
fossil fuels is another example of Hey, if we will

(27:33):
just utilize what we have now and quit doing all
this bull crap about climate change. We can produce all
the energy we need. And it's not just it's not
just the amount of energy that we produce, which is,
don't get me wrong, is incredibly important, but it's also
the cost of that energy. Because the lower the cost

(27:57):
of that is whatever bt would, whatever produces a BTU
of energy, the lower the cost to produce that BTU
means that you have lower costs to either get yourself
from point A to point B on an airplane or
a train, or a car, or even an RTD bus
or whatever widget you manufacture. The cost of the energy

(28:21):
that it takes to manufacture that widget is going to
be lower or at least stabilized, which means that we
what start reducing inflation, we start producing more and more
and more, and we become more independent, not just in
terms of our energy, but also in terms of our manufacturing.

(28:42):
And that's how Trump is going to impart start bringing
manufacturing back to this country.

Speaker 7 (28:48):
What you're describing, of course, the wind turbine graveyards sounds
like a potentially great movie, which cause pared Rokovich point, oh,
the Grandmother Years or something. I say go Keeler, new gear,

(29:10):
go new gear.

Speaker 1 (29:12):
Nuclear nuclear go nuclear nuclear is my old boss would say,
nuclear clear, nucular clear. George W. Bush nuclear nuclear. You
think about Cole's history, it really was. It gave rise
to the Industrial revolution. More than just the ascent of

(29:36):
a fuel source. It charted the foundation of modern industrial
society because it wasn't just a power source. It was
the engine behind the mechanization of labor, the expansion of railroads,
and then the emergence of steel manufacturing all across not

(29:57):
just our our country, but Europe too. In the United States,
the Appalachian region became the heart of coal country West Virginia, Kentucky, Pennsylvania.
The entire communities built around mining coal and that led
to multi generational employment, union, power, cultural identity, all shaped

(30:19):
by just the rhythms of coal extraction. And those towns experienced,
just like I've witnessed in the oil field, periods of
booms and devastating busts, depending on market swings and energy
policy shifts. But today, the socioeconomic consequences of coals decline

(30:40):
is felt all across Appalachia. Were unemployment, opioid abuse, economic stagnation.
All you can trace back to the collapse of the
coal economy, we're you know, and by the way, it's
not just Appalachia. If you look at a map showing
where coal reserves exist, yes, Illinois, Wyoming, well let me

(31:06):
skip Wyoming from a moment, uh Pennsylvania, Kentucky, West Virginia,
but also Wyoming, Illinois, Montana, Colorado, New Mexico, Utah, even
little parts of Arizona and Alaska all have coal reserves
and we're not exploiting those and we should be. When

(31:29):
you look at the top five countries and their percentage
share of world proven coal reserves as of December of
twenty twenty one, those that comes from the Energy Information Administration.
These the latest numbers I can find. We count for
almost a quarter twenty two percent of all proven coal

(31:50):
reserves across the country. So China is building all of
these coal powered plants. How much of the world's proven
coal reserves does China have They only have fourteen percent,
So we have twenty two percent. Russia has fifteen percent,

(32:10):
Australia fourteen percent, China fourteen percent, and India eleven percent.
And when you look at detailed geological maps, most of
those reserves remain underutilized, not because of the lack of access,
not because of economics, but because of government policies and

(32:32):
regulatory bottlenecks. That's what's keeping us from using it. And
if you and if you buy it all into my
theory that we can look around the corner all we want,
But I sincerely believe that there is something whether it's nuclear,
whether it's something else, I hope it. You know, I
truly hope it's nuclear power because it's somewhat limitless, and

(32:58):
it's certainly cheap, and it can produce an enormous amount
of power. But whatever it is, nuclear are otherwise some
things around the corner. Whether that's twenty twenty five, thirty
thirty five, fifty years from now, well, during that meantime,

(33:18):
we have enough cheap, abundant fossil fuels to power all
the electricity that we need for AI and everything else.
Are growing economy, and if we're going to do which
I think we can reindustrialize to some degree this country,
bring some manufacturing back into this country, we're going to
need that power. And if that reindustrialization continues to grow,

(33:44):
will need even more power. So Trump's executive order last
week is a really important cob in putting together this
entire portfolio of energy. It really is, and I'm hearting
use it lately, but it really is more than just drill, baby, drill.
It's drill mind, build particular power plants, whatever it takes,

(34:09):
do it all.