hey everybody Peter Z here coming to you from Colorado and today we're going to talk about electricity in the United States uh specifically uh Georgia Power which is one of the largest components of Southern Company which is I believe is now the second largest electricity producer in the United States covers the the Southeastern part of the country uh they filed something on Friday December 31st called an IRP an integrated resource plan and basically it's there more than back of envelope sketches for how they plan to meet power demand over the next 3 years they filed
an intermediate one last year and the big difference between last year and this year is they're anticipating uh demand growth in their region by the end of the decade growing by over two gws uh more than what they had planned for just 12 months ago and so in order to meet that demand they're adding more power by pretty much every type of generation you can imagine but the biggest change is that they're not going to decommission a couple of coal plants which of course has some environmental interests up in arms uh expect to see a
lot more of this one of the things to keep in mind when you're talking about this economic transition the United States is going through is in order to prepare for a post China world we need to double the size of the industrial plant in this country and that's before you consider trade Wars that's before you consider resource conflicts that's before you consider the green transition which will move a lot of things from fossil fuel to a more alternative system we just are going to need more power digitization is great AI is wonderful and all those
good things but ultimately if your economy is going to not just be based on Services if it's going to be based on manufacturing if it's going to be about moving things and stamping things and heating things and smelting things you're going to use a lot more electricity and the IRP that Georgia power just updated reflects that and you can only add new forms of electrical generation so quickly and that even assumes that the regulatory picture is very favorable now in Southern Company zone of operation Southern Company gets along great with all of the state legislators
and the state regulators so they face fewer obstacles than most electrical companies uh in adding new capacity but there are still upper limits on how fast you can add stuff uh one of the biggest restrictions is things like Transformers which can have a lead time of 36 to 60 months and until recently Transformers had like a two to four year waiting list based on what model you were looking at and without the Transformers doesn't really matter if you have the generation or not so there's a lot of delays that are just kind of hardwired into
this sort of problem uh but ultimately it's about generation if you can't generate the electrons to run through the system the rest of it is kind of a moot argument and Georgia power is now admitting in their IRP that coal at least in the midterm has to be part of the solution now in the long run coal is definitely going to go away in the United States anyway because natural gas is so much cheaper and as we continue to make incremental gains in solar and wind and Battery uh they are becoming more competitive uh but
the advantage you have with coal is it provides something called base load it's on 24 hours a day 7 days a week 52 weeks a year and that matches up very nicely with Mo manufacturing processes that run 247 because a lot of it's automated now and it lines up very well with things like artificial intelligence and data centers because those server Farms will be running 24 hours a day as well uh that doesn't work with solar when the Sun goes down the electricity stops uh and you really can't pair most of these new industries that
are coming in whether it's because of relocation reindustrialization or digitization they just don't pair well with Green Tech very well unless you also put in a huge amount of battery and by huge I mean massive uh the best batteries we have right now can really only discharge 4 hours of storage and there is no place in the continental United States even in the depths of Summer where you only have 4 hours of dark so you have to have something else and regardless of whether you love it or not coal is one of those something else's
so a lot of the coal plants that have been slated for decommissioning or replacement um over the course of the last decade expect most of those plants to a never be decommissioned and B if they have been decommissioned but not yet dismantled expect them to come back because we're going to need every electron we can possibly get and decarbonization For Better or For Worse is something that's going to have to wait for at least next decade and maybe the decade after e
