How Corporate America Is Paying For EV Infrastructure (Podcast)

Bloomberg dot com. We are broadcasting live from the Bloomberg New Energy Finance Summit at the Grand Hyatt in New York City, and one of the big questions here Paul is how do you develop an infrastructure to allow electric vehicles to really gain a popularity that would change the fossil fuel emissions of the United States. Joining us to

discuss that is Pascual Romano. He is President, chief executive officer of charge Point, normally based in Campbell Campbell, California, but he decided to come here even though it is not the weather of Campbell, California. Pasquale, So let's talk about this your business, How exactly is it establishing some sort of framework network charging stations for those electric vehicles? Um, the the key is cars charge where their park most of the time, it's a car's about a four percent

utilized asset. So of the time, it's kind of like your cat. It just sleeps all day, and where it sleeps is at home while you're sleeping, or at work. Uh, and a little bit of retail and around town. So the problem seems daunting if you have to populate all

those parking lots that you see when you're driving around. Um, but if you view it, if you create a business model like we have that lets each business engage with the v charging and pay for their portion of it, or each property manager, it's actually a completely tractable problem. So that's how how we've done it is essentially using businesses to crowdfund a very large network could be charging,

and we introduce models to make it really simple. So pass well, just get let us step back a little bit. Where are we in this country in terms of adoption of electric vehicles? I see more and more of them out there. I see more and more charging stations. Actually bloomberg downa Princeton has a charging station. Uh. Just generally, kind of where are we and where do you think

we are? Realtive that tip point to really encourage mass adoption. Yeah, So The way we look at it is it's uh, you know, if you talk to consumers that own an electric vehicle, they'll never go back to a gas car. The problem is there are enough makes and models to fit all the lifestyle choices and and affordability requirements of most of most consumers. Half the US market instructs and suvsh So until there's enough choice and trucks and SUVs,

you have a limited penetration. With all that said, Um, it's going about as fast as it can go given how fast cars turn over. Uh. So we're super encouraged. You know, you had you know, three thousand cars sold last year in the US that that had to plug. You have more coming this year and uh this and next year is a literally a model you're extravaganza for most of the O E M s that are really dot. What is the cost of filling up a car with electricity? Uh,

compare with filling up a car with gas? Yeah, it's a it's a great question. Um, if you fill up a car, if you charge your car off peak or you use commercial rates at work. By the way, most employers give the power away, It's about the cost of coffee to give someone although we have good coffee. We do have good coffee, so that coffee probably is a little more exposive. But I do have to wonder though,

even if somebody is bearing that cost. So if the if the company is bearing that cost, then that means that they're going to be less inclined to build out this network. If the cost is is priviitially expensive, Yeah, it's actually not compared to other things. So first of all, let's talk about how much it actually costs. It's about four three to five hundred bucks a year, depending on the utility rate that you're charging the car on to basically uh fuel it to the average drive miles a

year about their car per car. Now, let's look at what corporations currently spend. They spend about three thousand dollars subsidizing cafeterias. They spend about two per employee. They spent about two thousand per employee on health and wellness Jim's things like that. So when you eat that sandwich or go to that yoga class at work, your employers really

subsidizing your uh, you know, your benefit there. Um, they spend a three to fos a year on coffee per employee, and it's that or less to give people both the infrastructure on our subscription services for infrastructure, they can fund that plus the energy, so it's not that much more money than coffee. They've viewed as pretty insignificant. So how many clients are customers do you have with your charging stations? And well, what's kind of the growth you guys are seeing.

It's about about eight thousand UH clients and customers all over the United States and Canada now in Europe where we entered Europe about a year and a half two years ago. UM, so it's growing very, very very quickly. To give you a stat that's interesting because I think it's a leading indicator. fIF of the fortune one d are on charge point and obviously we don't have a hundred percent market share, so that shows you what the large employers are setting as trends for the future game.

So I'm just wondering. I noticed that Chevron had invested in your company. Are there other oil companies big oil UH that's investing in in this company or is it exclusive to Chevron? It's not. Our investor sets, not that there's no exclusivity in our investor set. We have two O E M s UH BMW and Dame lad. We have two large utility groups in Constellation and and UH A ep UM and and we have now Chevron UH

and there's no exclusivity. And if you see what Shell has been doing in our market, not not investing in US, but investing in acquiring companies in the space, and also BP, there's a lot of motion with oil and gas. Well, who are your big competitors? UM. It depends on the vertical. So it's hard to answer that question because we're because we've been around so long. We're an eleven year old company, raised a little over half a billion over that eleven

and years. We're the only company, regardless of size, that's in every single vertical into continents, right, So we're in home, multi family, workplace, UM, UH, Metroarria, fast Highway, fast fleet, all those different verticals. There's no other company that's doing all that. But in any given vertical, you'll see the Anil acquisition of the motor works in the home business, for example, so they're there. UM. You'll see UH with Shell, the acquisition of green Lots, you'll see UH and and

a few other things. You'll see them in lease Co in Europe, you'll see them in a few areas in the United States, So depending on the vertical, you know, we got plenty of competitors. Very good. Pascual Romano, Thank you very much. Pascual as a president and chief executive officer of charge Point based in Cambell, California, but joining us here in New York at the Bloomberg New Energy Finance someone at the Grand Hyatt d uh in New

York City. Electric vehicles obviously, you know, people are just wondering where and when is the tipping point for mass adoption, and I think it's probably gonna come from Detroit when we get the you know, a lot more choice. This maybe pay attention to the New York Auto Show coming up in April. Well, energy policymakers in Washington are frantically drying to keep up with changes in consumer behavior as

well as new technologies and the energy space. To help us kind of dig through some of those issues, we welcome Sarah Sarah lattis law director and Senior Fellow Energy and National Security Program for the Center for Strategic and International Studies based in DC. But Sarah's joining us here in New York at the Bloomberg New Energy Finance uh,

symposium Sarah, thank you so much for joining us. UM. Yeah, we read a lot about in the press U from maybe some of the new presidential candidates for about a green New Deal. UM, lots of different flavors out there. What is your sense of what some of the core components of a green New Deal might incorporate. Yeah, So the Green New Deal is a big idea. Uh, it's really important that everybody realized there's not a plan, so

it's just it's just a proposal. It's a big idea, and fundamentally it's about tying together the issue of decarbonizing the economy for the purposes of managing climate change and UM doing something about inequality and income and those types of economic insecurity issues. There's not like a prescribed policy

behind that. But on the green side of the equation, it's broadly about trying to find a way to reduce emissions in the electric power sector, to reduce emissions from the transportation sector, UM, and to do a lot of things to refurbish the kind of infrastructure we have to make it a lot more energy efficient. Are there policy creators drafters in President Trump's administration right now that are working on proposals that could move the United States closer

to reducing emissions substantially. Yeah, So I think the important thing is, uh, you know, transitioning from the Green New Deal concept, which is really a debate happening in Congress, to the executive branch, which is where the Trump administration is doing a lot of their pots happening actually now right and where they working on So a lot of what they're focusing on is really um trying to do

two things. One, deregulate the US energy sector, which they've made a lot of progress on, so remove the regulation that they see impinging on the production of energy at large across the board. And then also try to sell things like oil and natural gas and coal to other countries around the world. Right, they realize we have a huge amount of energy resources and they're so they're trying to sort of develop those things. Those are not necessarily

commensurate with trying to reduce emissions. So the on the natural gas side, to the extent that we're using natural gas in the in the US as opposed to coal, that's one of the things that they tend to focus on when they talk about the success that the US

has had in terms of emissions productions. Critics of the administration would say, you know, a lot of the regulatory efforts, whether it's through the Clean Flower Plan or through the efficiency measures that they're trying to roll back, are actually working against emissions reduction. So it's kind of certainly a mixed record in that regard. Well, certainly I'm seeing you know, as you as you drive around, you see more and more wind farms, You see more and more solar panels

on just individuals homes as well as businesses. You see big farms of solar panels. Is that being driven by just the market or is there actually policy behind it,

driving it and supporting it. Yeah, I think the really good news stories you look across the United States, there are policies that have driven renewable energy into the market um, but increasingly that's aided just by the performance of those assets, right, So things like when things like rooftop solar um are very cost competitive, utility scale solar cost competitive in a

lot of different places. Where you're seeing right now is state level policies that are looking out and saying, hey, we've actually been able to increase renewable kinnetration into our electric power sector. We think it's been a good thing. It's created jobs, it's reduced emissions. There's an industry here for this kind of stuff now, and they're doubling down on some of those policies. UM particular ones. When you talk about deregulation, we focus a lot on oil drilling

in the United States. We focus less on our relationship with nuclear power and some of these issues that might affect national security in a way that people might be uh, not me as aware of where are we with that and how much has deregulation kind of changed the game there. So I think in the on the nuclear power side of the equation, the administration is focusing on national security

implications of not having a nuclear sector. And so you just saw Secretary Perry go down to Georgia and to um announced additional loan guarantees for the sort of ailing nuclear plants that are that are being built there. And I think that's one of the reasons why you've seen both the administration in the Hills sort of talking about how do we support nuclear power so that it has a future in the United States. Really, it's relatively cost constrained.

We don't have a lot of projects that have come online that have been under cost or on time. They've all been over cost and overtime UM. And then you're seeing a lot of state level policy that's trying to advantage even existing nuclear plants that can't compete in the markets. And so I think what's happening is is there's a more active dialogue, certainly UM one that this administration is engaging in on whether or not having a vibrant nuclear

industry yields national security benefits for the United States. What about exporting the nuclear energy UH technology to other countries. Yeah, that's a much more controversial topic. I think in the past. You know, whether or not we export nuclear power technologies to other countries really depends on the recipient country and the level of commitment that we have from them that it's going to be safe, that I won't have proliferation risk,

all of those sorts of things. I think the US is really concerned because the US is not as competitive internationally as it is anymore, especially relative to people like countries like China and Russia that are offering entirely different kinds of deals for these other countries, and so, UM, the US has really high standards for what it's going to export to other countries, and so it's a it's a fairly controversial issue as to how to get more

competitive in that field. Sarah lautus Law, we could spend the next hour speaking with you, Sarah lattus Law, Thank you so much for being with US, Director and Senior Fellow for the Energy and National Security Program at c s i S. The Center for Strategic and International Study is based in Washington, d C. But joining us here Lave from the Blueberg New Energy Finance Summit in New York City. But we're here live at the Bloomberg New Energy Finance Summit at the Grand Hide Hotel in New

York City. And one of the key issues being debated here is security, a security of the energy grid, security of the US infrastructure. And to help us kind of dig down on some of these issues, we welcome edgard Captivil. He is CEO of Nozomi Networks, Inc. Based in San Francisco, but it got it joins us here in New York. And I must note that this morning no Zomy Networks was named a twenty nineteen New Energy Pioneer by Bloomberg

New Energy Finance. So congratulations at Gardener thank you very much. So talk to us a little bit about I guess the security and industrial securities. We think about more and more of industry being automated. That raises the risk for cybersecurity issues. What is your sense of the lay of the land right now, Um, Paul, that is absolutely correct.

I think automation is increasing and that dramatic pace. Traditional industrial control networks are converging to be more like I T networks and that means more exposed, more vulnerable to to again exposure an attack. And Um, there are several verticals in what we would call critical infrastructure that are affected by this. Not only oil and gas, electric power,

of flavors of power, manufacturing, transportation, chemicals, pharmaceuticals. All these articles rely heavily critically on their industrial control networks for revenue and production. And again, as we converge and those networks get more exposed, we try to get more data out of those networks. UM, folks are more vulnerable to attack. So Edward, what actually do you do to prevent these attacks? Absolutely, we have an appliance that connects to these industrial control networks.

And first the first thing we do is, you know, you can't protect what you can see. So the first thing you want to do is provide a layer of visibility in industrial control network which traditionally have been under instrumented from a bunch of legacy reasons. There were there were um a little bit backwards. When it comes to technology advancement, there's been um there's been a belief that

they're isolated. But with this convergence, exposure and modernization is accelerating, and again people want to get more out of those networks from a data analytics point of view, and therefore they're connecting them and that makes in them, makes them more exposed. So after we provide that initial layer of visibility, we learned about the process behavior being operated in network,

and we provide anomaly detection will never reality management. All the cybersecurity infrastructure that allows you to monitor and protect industrial control networks as if they wear I T networks. So how about we've seen in the past very high profile news stories about financial institutions being hacked and so on and so forth, how would you characterize the United States industrial plant in terms of cyber security. Cybersecurity in general is not too different from the United States than

than other places. I think the reason you have not seen, you know, something like an industrial nine eleven or or a major attack. Is that attacks or or these these events have to align, you know, vulnerabilities with intent and and and an author who is going to do this. So when you look at industries in other regions like the Least, et cetera, for them, industrial cybersecurity attacks are not a theoretical scenario that happens in a fairly significant way.

Very few of those get get to the press. In the US, that alignment hasn't happened of intent, uh, combined with the vulnerability aspect, not to a great extent. We have a lot of reconnaissance activity happening from different sources, and that's been in public information. But we we really haven't had a major attack in the U s s as that that has been publicly UM that has been publishedist has been publicized. That's what I'm wondering. What have we not heard about that has happened or at least

that has been blocked. I'm wondering how big of an investment are energy companies making in cybersecurity right now? It varies by industry. UM. Some of the industries that are more regulator or have tighter budgets obviously make make less of an investment. We've seen a tremendous amount investment from an oil and gas perspective, even though those those companies

don't are not necessarily the fast movers. Electric companies from downstream to upstream to downstream have also made significant investments, both in the US and globally. Chemical plants, mining plants, everybody who needs to ensure the reliability of their production. If you as you talk to your clients, um, what what areas of their industrial operations do they feel is most exposed? Is there a common threat or common exposure area?

It really depends again by by vertical um in manufacturing or mining, it's it's primarily you know, kind of one business in oil and gas and electric you have upstream downstream retail. We don't really get too much into the detail because retail side because those are more like I T networks. So I'm just wondering, how does this fit

into new energy, wind and solar. Yeah, absolutely, we call that distributed generation like everybody else UM and distribute generation has its own characteristics, but but it's absolutely UM part of part of the game. So so you know, there's industrial controls in a wind turbine, and I was just wondering because you won this this New Energy Pioneer Award

for this year. Congratulations, thank you. And I'm just thinking that this security is something that goes throughout every aspect of energy, and I'm just wondering, you know, is there something unique about sort of the new energy complex when it comes to security. Um, new energy is great. From the perspective of industrial cybersecurity and exposure is not too different other than maybe the cost structure has to be

different for those remote distributed sites. But other than the cost structure required to to serve those from our perspective, which is uh to provide visibility and protection, it's it's very very similar. Edguard cup Ta Vielle, thank you so much for being with us. Edgard Captive Villas, chief executive officer of Zomi Networks, which is based in San Francisco, but he joins us here in New York for the

Bloomberg New Energy Finance Conference. Well, Bloomberg News is reporting this morning that Theresa May is inclined to put our Brexit deal to a third vote in Parliament on Tuesday, according to people familiar with the matter. Likewise, the EU is also saying that is now prepared to handle the impact of the UK leaving without an agreement, a scenario it describes as quote increasingly likely. So a lot of

pieces are moving in the Brexit debate. To get the latest, we welcome John Author's John as a senior editor for Bloomberg Markets. He joins us in our Bloomberg Interactive Broker studio. John, thanks so much for joining us. A lot of moving pieces. As I said, what is the latest coming out of Parliament? Well, we've heard from Theresa May in the last few minutes.

She hasn't said that she's not holding a third meaningful vote to use the phrase we will got used to, but she has said I'm sure correctly that she doesn't yet have enough support to win one. Now what is intriguing is, obviously we've also had all this glorious back

sit back scenes, backstage political maneuvering going on all weekend. Plainly, a lot of the most euroskeptic, most pro Brexit MP's who've been talking to have suggested that they might be prepared to accept her deal as it stands in exchange for a copper bottomed promised from her to quit, which which is a difficult situation for her to be into present mildly sorry at least, no, no, no no, no worries it all. Does anyone have like a chance of hard brexit ometer? I mean, I feel like that's sort of

what we're all trying to get at. It's like, are we incrementally closer further away from a hard brexit that leads to, you know, catastrophe fit. Various people have attempts at hard brexit to meters, some of which have got us highest fifty percent. I mean, you can, you can try to. Unfortunately, I didn't bother to check any of

them before I came to the studio. So I the last I saw you had had them spike as high as fifty at one point, most of most versions of where you get from the betting on sense on a distinctly lower than that. Yeah. Well, I guess I guess that the question that also is today move us closer towards the higher than or lower. I think we are probably probably moving towards lower than fifty, but I wouldn't

want to swear to it. I suspect um that terraising may may have got to the point where her unpopularity almost begins to work in her favor. There's a lot of ardent Brexiteers who are beginning to think, well, let's just take this rather than mess around or take the risk of leaving without a deal. We'll just take this rotten nowforl deal as long as she goes straight away afterwards, and then somebody with a bit more you know, British bulldog spirit or whatever where they want to look at it,

can can take over the negotiations from there. Is there sense what's the status of a second referenum? I haven't heard that spoken too much in the less twenty four I think there's a good reason why you haven't heard it spoken very much. It's still very difficult to see how we get to a second referendum, given that the leaders of both parties are very nervous to actively propose such a thing, and that that we still have a

situation where the well, there are two key points. One is that you have a critical block of very energized brexities with the Conservative Party and the balance holding Democratic Unionist Party from Northern Ireland are plainly not up for a second referendum. And you also have a large number of labor MPs Labor as a party is largely much

more pro European these days than the Conservatives are. But a lot of Labor MPs are in working class neighborhoods where there were huge majorities for leaving and are very very mindful of that and don't want to go to the go back to their local electorates, having having sanctioned the second referendum. I suspect, yes, it's it's being here in the Zeit Guist in London. It's it almost isn't being mentioned at the moment because it's very difficult to

get there and so contentious to get there. All right, so you could take off your Brexit hat. Now we're done with that segment of this. Yes, you're happy to take off your Brexit hat put on your weather goal global markets and bond yields hat, which is of course the big conundrum right now, the fact that we're seeing the pool of negative yielding debt surge beyond ten trillion

dollars of most in September two seventeen. Big question here, will this backdrop drop push investors back towards risky assets or is this just flashing uh don't go their sign I tends it tends to be somewhat barish about this intense towards the latter, I would say that the single most important indicator we need to look to tell which though that is what the answer is, is earnings earnings per share. Generally speaking, stock earnings do badly when bond

yields are falling. Even though a falling bond yields can plainly help some stocks, all other things equal, earnings tended to do badly. They also tend to do badly when we are in a state of yield curve inversion. And you have actually seen a very sharp full in earnings expectations so far this year that the markets, the stock marketers totally ignored. I think that's where the critical point lies.

If there was still real earning power, earning capacity in the corporate sector, then you probably could see through what's happening in bonds. You could take advantage of the of the fact that money is cheap. But as it stands, I think we need more to think of the bond marketers giving us a message. It's as good an aggregator as any of of prospects for the for the economy, as you know very well yourself, and I think it probably suggests that that we should be bearish about corporate

earnings and therefore probably that we should bearish about risky assets. Hey, John, I hear from somebody in my ear that you were starting a new book club for Bloomberg. Tell us about that. Yes, yes, imaginatively called author's notes. Can't resist a pun on my surname sometimes. So the idea is Oprah style. This is this is a big attempt to buy Bloomberg. Were we recognize that a lot of our very busy readers wish

they wish they read far more. And this is like any other book club and attempt to try to use a bit of peer pressure to actually to actually get people to to read the number of people who do really start the honestly wanting to read a book a month, it's quite serious. So the idea is that Bloomberg is designating me initially to to try to be the the Bloomberg business book answer to Oprah and nominates a book free.

There's not many other ways I'm much like Oprah. So John authors, hold on a second, you are the Oprah of Bloomberg. That is what we're going to introduce you as from here on out. John Authors the Oprah of Bloomberg, also known as the Senior editor for Bloomberg. Marcus joining us from a Bloomberg Atta Active Broker Studios. We have been broadcasting live from the Bloomberg New Energy Finance Summit.

Thanks for listening to the Bloomberg pen L podcast. You can subscribe and listen to interviews at Apple Podcast or whatever podcast platform you prefer. Paul Sweeney, I'm on Twitter at pt Sweeney. I'm Lisa A. Bram Woods. I'm on Twitter at Lisa A. Bram wits one before the podcast, you can always catch us worldwide. I'm Bloomberg Radio