00:00
Speaker A
let's stick with natural gas and I'd love to turn to turbines. So, for the AI investor podcast, lead investor Eric Bleeker has discussed how behind the meter is absolutely essential for the data center build out.
00:15
Speaker A
there's permitting, local opposition, uh grid limitations which you've written about. Um so today if you're doing behind the meter, right that requires natural gas and turbines. Um, G Vernova has a backlog of I think 116 gigawatts, which is a mind-bending number and is taking orders for 2031.
00:46
Speaker A
Siemens and Mitsubishi are booked out years as well. So, if natural gas is as affordable as it is, are turbines the real ongoing choke point in the future? Should investors be excited about this or is this a case of, you know, the the problem with choke point or you know, the solution of choke points is choke points and that they will get solved more quickly than people expect. How do you view the turbine environment right now and is that a place where
01:14
Speaker A
we should consider investing because it will be lean for years and therefore price setters or is this a solution waiting to be solved right around the corner as capacity comes online and we should look elsewhere in the industry for opportunity.
01:30
Speaker A
Yeah, look, we did a we did a piece um called Taleb's law and uh this is from, you know, um Taleb of course, who is a, you know, an interesting character, a pretty deep thinker, a brilliant man actually. Um, he posted something on Twitter that uh that I saw back in the day that kind of stuck with me and um something along the lines of um,
01:54
Speaker A
not all gluts lead to shortages, but I've never seen a shortage that doesn't lead to a glut. Um and we have a shortage of machines capable of converting natural gas to electricity today.
02:08
Speaker A
You framed it as a shortage of turbines. I would frame it as a shortage of solutions that can convert natural gas into electricity, uh cheap enough that the discount that natural gas presents can be captured. And so this is why you see Bloom energy, which is not a turbine company, but is in fact a solid oxide fuel cell company sold out as well.
02:35
Speaker A
Um we've had some mixed analysis of Bloom Energy. Um you know, it um there's a lot of questions swirling around it, but forget about the company itself and we don't do individual stock investments, but um or recommendations, but um Bloom is a manifestation of the market crying out for solutions to convert natural gas into electricity that do not um
02:58
Speaker A
do not require turbines. Elon Musk of all people have been has been making some investments in this regard. Um there is a shortage of such machines and if you follow Taleb's law, all shortages will lead to gluts. So what's the investor to do?
03:13
Speaker A
I think the G Vernova trade if you pushed us is done. Like everybody kind of knows that story what your edge. So if we were say participating in the private markets where we do a lot of our own investing, we would be looking for the startup that allows data centers to take natural gas and get data out in a way that does not uh find itself on the critical path of turbine production.
03:41
Speaker A
And there's some alternatives out there that are interesting, but that's where the money will be made. Um closing of such arbitrages is where um generational wealth is created.
