Cleaning Up: Leadership in an Age of Climate Change

Can You Run a Grid Entirely On Renewables? Ep208: Anders Lindberg

Episode Notes

Can You Run A Grid Without Fossil Fuels?

"Yes," says Anders Lindberg, President of Energy and Executive VP at Wärtsilä, on this week's episode of Cleaning Up. It'll just cost €65 trillion extra by 2050.

Anders' team at Wärtsilä has recently published its Crossroads to Net Zero report, which argues that keeping a little bit of flexible generation on the grid will save huge amounts of money as the globe strives for net zero, while also speeding up the transition to renewables. The argument centres on what to do with the last few percent of power supply, and what forms of generation need to be built to ensure consistent electricity supply and prevent black or brown outs.

Perhaps unsurprisingly for a gas engine manufacturer, Wärtsilä's report makes the case that gas should provide the last few percentage points of electricity generation. Michael Liebreich puts that claim to the test.

Discover more:

Wärtsilä's Crossroads to Net Zero report: https://www.wartsila.com/energy/towards-100-renewable-energy/choosing-the-optimal-pathway-for-energy-transition
Can Germany’s Gas Giant Go Green? Ep206: Michael Lewis - https://www.youtube.com/watch?v=DOD-f6uSPgc
Q&A: What we do – and do not – know about the blackout in Spain and Portugal — https://www.carbonbrief.org/qa-what-we-do-and-do-not-know-about-the-blackout-in-spain-and-portugal/
ENTSO-E expert panel initiates the investigation into the causes of Iberian blackout: https://www.entsoe.eu/news/2025/05/09/entso-e-expert-panel-initiates-the-investigation-into-the-causes-of-iberian-blackout

Leadership Circle:

Cleaning Up is supported by the Leadership Circle, and its founding members: Actis, Alcazar Energy, Davidson Kempner, EcoPragma Capital, EDP of Portugal, Eurelectric, the Gilardini Foundation, KKR, National Grid, Octopus Energy, Quadrature Climate Foundation, SDCL and Wärtsilä. For more information on the Leadership Circle, please visit https://www.cleaningup.live.

Episode Transcription

Michael Liebreich

What's interesting is there are these people saying you cannot run a grid without fossil fuels. It seems to me that you cannot run a grid without a plan.

Anders Lindberg

I think that's more like it, because you can run without fossil fuels and the traditional generation. But of course, you need a plan for how to deal with this, when you shut down the coal and combined cycle gas turbine (CCGT), et cetera.

I know that in the UK, they've been planning for this for over five years. How do you actually run the UK grid when you don't have coal or even CCGT on the grid? It's not something that you decide and do overnight. This is kind of complicated stuff, right?

Yeah, and it's also long term planning that is needed, because this is a plan over many years and it takes time.

Hello, I'm Michael Liebreich, and this is Cleaning Up. There's something about the need to decarbonize our economy that brings out the absolutest in people. Either it's all about wind, solar and batteries, and those are the only technologies we should use, or it's all about nuclear. Or fossil fuels created the world we all benefit from and enjoy and they'll be with us for decades, and therefore any money that is spent on any low-carbon solutions is money wasted. The reality is, of course, we can decarbonize our economy. We can do so affordably, and we can do so whilst preserving its resilience, but we'll only do it by considering energy as a system. My guest today is a leader in the world of energy systems thinking. Anders Lindberg is president of energy and executive vice president at Wärtsilä. And Wärtsilä is, of course, a member of our Leadership Circle. Please welcome Anders Lindberg to Cleaning Up.

Anders, thank you so much for joining us here today on Cleaning Up.

Thank you for having me here.

To get started, we’'ll do what we always do, and ask you to describe who you are and what you do, the short version.

So I'm an electrical engineer by background, and I have done product business my whole life, and I'm responsible for Wärtsilä energy, which is helping customers to decarbonize their power generation.

Describe a little bit the product set that you sell. When you say, decarbonize the generation. How do you go about doing that?

Yeah, so first of all, we have a power system analysis group that helps our customers to decarbonize. And we also have energy storage products, as well as engine power plants that are flexible.

But now those products, the energy storage, if I'm not wrong, that's being sort of demerged from the energy piece, is that right?

It's still in Wärtsilä, but its own segment.

It’ll be its own segment, and your direct responsibility will be for the engines but also the analysis unit, right?

Absolutely.

And I should say for our audience that you are, and I'm very delighted that you are, a member of our Leadership Circle, so a supporter of Cleaning Up, and I think as we go through this we'll probably find out why that is. So we're at a very interesting time as we record this, because obviously you've got all of the political winds of change in the US, that's one thing. But also last week, the power cut in the Iberian Peninsula. So there's a lot of pushback against decarbonization. And you went straight in there and said, ‘we help our clients decarbonize.’ So are you noticing those winds of change, or is it just business as usual for you right now?

I mean, we are very much observing what's happening with the tariffs in the US, and, of course, analyzing also what happened in Spain last week. However, we saw that last year was also the highest year ever of renewables being implemented in the world. So we see that renewables have very much made a commercial breakthrough, increasing the amount every year. And this is where we can help our customers, because when you have renewables, they are intermittent. Solar and wind are intermittent, and you need flexibility in order to have more renewables in the system.

Okay? If I was playing devil's advocate, I would say, okay, you've said it's all about decarbonization. And renewables are doing so well, lots of wind, lots of solar, you have a storage business, but you sell gas engines. How does that make sense?

It makes very much sense, because with battery storage, you can do short term storage, but when there is no wind in the winter and it's cold and you don't have sun, you still need to cover for those periods. And the engine power plants, they are very flexible, and they can start up very quickly and also be there when they are needed by the system. If you look at the system holistically, they are needed, and we have done studies globally. We did a study at the end of last year where we looked at what is the difference in the scenario if you do only renewables and storage to reach the 1.5°C that was agreed in the Paris COP, versus the second alternative when you have renewable storage and engine power plants? And there are some key findings of that study, and that is that you save — up until 2050 — you save €65 trillion if you have the flexible engines. And you reduce the CO2 emitted, because you can move much faster implementing renewables, so you save 21% of CO2 and, on top of it, you reduce the 88% curtailment that you would have if you only had renewables and storage. So there is a fundamental difference in adding flexible engine power plants compared to only having renewables and storage.

Okay, so there's a lot to unpack there. I'm trying to think, as you spoke there, I think that €65 trillion euros may be one of the larger numbers that we've had on Cleaning Up as a claim. So we're definitely going to be doing some unpacking. So let's start with that energy modeling group, right? Those are very specific numbers. It's 21% of this and 65 trillion euros of that. And so who is that group? Where do they sit? What tools do they use to come up with these figures, these claims.

So they use off the shelf tools for doing the analysis. So many utilities are using the same tools, and they sit primarily in Finland, where we have our headquarters, but also in the US. So we have a group that can do this modeling of different systems. So we have done more than 190 systems all over the world.

How many people are in the group?

It's about 10 people.

And I guess one question would be: is this in line with the findings of the IEA, or Bloomberg New Energy Finance, the team that I created, DNV, there's all sorts of people. Agora Energiewende in Germany? Are your findings in line with those? Or are they outliers?

I think they are in line with what we see from Bloomberg and other such organizations. So it's nothing. What we are doing is that we are, of course, seeing, when we do the analysis, we see the difference on the system. If we look holistically, if you add flexible battery storage and engine power plants.

Which may have something to do with the products that you have in the market being storage and flexible engines, but if it's in line with the other modelers, then that would suggest that it's correct. Why do you think, though, that this isn't generally known. What you're essentially saying is a small amount of flexible generation, particularly because the storage everybody accepts is a big piece of it, but what you're saying is a small amount of flexible generation essentially goes a long way to enable decarbonization. Why is that new news?

I think it's because we have looked at it. We have done studies on Chile and Finland, for example, where we have looked at what is the difference if you add a little bit of flexible engine power plants to the system. So in Finland, for example, we added two gigawatts, which is quite a lot in gigawatts, but it's very little running hours. So in total, it's less than 3% in 2030, of the total energy produced. But this is reducing the cost of the power, and it is also making the system more resilient.

So I love this, because I've been saying for years that we shouldn't be absolutists. You know, you have Professor Mark Jacobson saying, ‘You can only do wind, water and solar and then obviously batteries, but you don't need and you shouldn't use anything else here in the UK.’ The plan is 2030 clean power, and I think I've been warning for years that this kind of absolutism is very, very expensive. So what you've done, or that modeling group has done, is to put numbers on how much more expensive it is to be absolutist, and the numbers are colossal, right?

Yeah, they are. And this €65 trillion is of course, from today up until 2050. But it's still a colossal number. And the last percentages, so to say, are very expensive. So you can come very far with the sustainability of adding renewables, if you have the flexibility in the system, without going the last few percent where it becomes very, very expensive to have it 100% renewables only.

So I first interacted with some members of your team, Sylvia Zumarraga, who's your Latin America business development person. And the reason I was very excited to be in touch, not just because I love Finland, I spent good times there during my skiing days, but also because I was on my way to Chile, and your team at that point had done a lot of work on Chile. And I wanted to know, what would I find? And what would I be talking about? Can we just dive into Chile a little bit and the work you've done? Because Chile is a fantastic country for solar, particularly, but also very good for wind in the south, and then you've got Santiago right in the middle. It has 3,000 hours of zero-priced power, so pretty much all day, every day, there's so much solar that the price drops to zero in — it has zonal pricing — but in all of its zones, it's dropping to zero. And you know, I was worried that I would be asked how you solve this. And then I came into contact with Sylvia and through her with your modelers. So what does your Chile study suggest?

So, when we have studied Chile, where, as you point out, we have very good renewables: solar in the north and wind in the south, and then you basically have the load in the central so that's a very good starting point. But what has happened now is that you have reached quite a high level of renewable penetration, which is good, but the remaining power generation is inflexible. It's coal power plants and Combined Cycle Gas Turbine (CCGT).

And that’s about 25% of the power demand in this country?

Yes,

So you've got simultaneously zero power price, but they can't switch off the coal because it's inflexible. It just has to ride through.

Which then has the effect that you have a lot of curtailment. So we also saw in the last auctions in Chile that the price actually went up a lot because of all the curtailments that the renewable companies have seen. So if you instead then had flexible power plants in the system, you could take out the coal power plants and you could have the flexibility of switching on these power plants when they are needed, and then shut them down immediately when you have wind or solar coming back. And then you would have much less curtailment in the system, and therefore the renewables will continue to be low priced.

And that 25% coal, if you took that out and replaced it with flexible gas-based, natural-gas based generation, what would be the percentage that you would have to replace the coal with? It takes a bit of time, you have to build more renewables and presumably build some transmission, but ultimately, where do you end up in terms of the flexibility need?

So if you look at the energy generated in a year, in 2035 you would have about 4% of energy coming from fossil, meaning natural gas, if you have power plants.

So you've gone from 25% coal to 4% natural gas, which is better than coal anyway, as long as you've not got lots of losses of methane, fugitive methane emissions. But assuming you haven't got that, you've gone from — I don't want to say nasty coal — but very high emitting coal, to medium emitting gas, and from 25% to 4%. It sounds, I hate to say it, but it sounds so obvious.

Yes, I think it is obvious. Once you study a system or a country, and you look at the modeling, it is very obvious, but you need to do the study and base the decisions on the facts when you do these studies, and not being — so to say — unpragmatic and just doing renewables only, and try to combine it with the existing old coal power plants that you have in the system.

So what would be the alternatives? I mean, if you say, we’ve really got to switch off that coal, the alternatives would be, presumably, a lot more renewables, a lot more batteries. Would a lot more transmission help?

Transmission helps as well, of course, because in most systems today you have bottlenecks in the transmission. Chilem north to south; Germany, north to south, Sweden, north to south; UK, north to south. So usually it’s a north to south issue. So it would be helped as well, because that means less curtailment. Because in many of these places, you have the good renewables in the north, and you have the industry and the demand in the south. So that would also help.

Okay, so if you want to get down to 4% then, what your models have proven, if I've understood it right, is that the cheapest way to do it is flexible generation. So that saves you from a more expensive pathway with more renewables or more batteries or much more transmission.

It helps you on the investment cost. It helps you on the CO2 reductions, and it helps you on the curtailment to have less curtailments.

Ok, so it also helps to maintain the business model, as it were, to do the other side of what you need to do.. What do you do with the last 4%? Do you just throw up your hands and say, ‘Well, you know, that's not our problem.’ Or do you have a cunning hydrogen plan, or some other way of getting rid of the last 4%.

So from Wärtsilä’s side, we have, of course, invested in R&D, so we can do biofuels. We can do already today, blending with hydrogen up to 25%. We are preparing, and we have certified an engine power plant concept based on 100% hydrogen or ammonia. So there are many different options of doing carbon neutral or zero carbon fuels, to get rid of the last 4% so to say. But this is a political decision, because you can also say: okay, do we need to go all the way to 100% or should we be satisfied with 95 or 96% in the system? And do we have some better place to spend the money than to convert to 100% sustainability? But from our side, we have the products to go 100% if our customers want to go 100%.

So this is a conversation I had last week with Michael Lewis, the CEO of Uniper, about: well, how much does that last 4% — I think I was talking 2 -4% — how much does it cost? And I think you probably know I've done lots of work on hydrogen, and my sense is certainly that it starts to get very expensive. And blending 25% is a lot of money and achieves only, I think, 7 or 8% emissions reductions because of the different energy densities by volume. So you would have to go to full hydrogen or to ammonia, really, to get that last few percent, and the costs are going to be absolutely enormous. You might not mind, because you're going to sell the equipment, but for the rest of us, that feels like a lot of money for a relatively marginal final improvement.

First of all, I should say that we see natural gas as a transition fuel. So I would say up until 2035, we very much see natural gas as being the fuel. So it is the very last in the transition, so to say, to come to 100%. And we don't really know what the exact cost will be in 2035 or 2040 when the fuel will be available, because it will be scaling up, hopefully, and then we will see what the cost is. However, it will still be costly, that I think we can agree, and therefore it is a political decision at the end of the day, if it's worth that, or if it's better to go into other, more hard to decarbonize sectors and put the money there instead.

How would you deal with an activist who says, ‘he's very slick, and it all sounds great, but this is really going to lock us into natural gas.’ Because even if your target is to get down to 4%, then you're going to be building pipelines, you're going to be entering deals, you're going to be training engineers, you're going to be investing, and you're never going to go away. You're never going to get rid of this last chunk of natural gas. That's what this is really about.

I think that up until 2035, as I said, the most important thing is that we now take the steps and decarbonize as much as we can. Wide installation of more renewables and having flexibility in the system. So I think that path is the most important, because that's really when we do the majority of the decarbonization, and then we have the decision, because it doesn't need to be hydrogen. It can also be other fuels, zero carbon or carbon neutral fuels like ethanol or methanol.

Or just biogas. Look at what Denmark does with biogas. Sometimes I just think, ‘Why is everybody being so complicated about this?’

And these options you have already today with the products that you have today?

So that's Chile where, essentially, I think,if I sort of step back, it's like, ‘okay, they're stuck on 25% coal, they could be stuck on 4% natural gas, if it was used flexibly.’ If that's correct, then let's move to Finland. What's the analogous pathway then for the work that you've done on Finland? Because that's a very different energy system, different geography, different temperatures, to Chile. Where are they now, and where could you quickly get them to using flexible, if they were sort of politically allowed to just say we're going to do some flexible generation, where would they get to?

So today, Finland has an average of about 9 gigawatts and a peak of 15 gigawatts in power demand. That's where it is today. And in Finland, the majority — 40%— the biggest generation, is from nuclear. And then you have wind, about 19% and then you have hydro, about 15%. But there is going to be, over the years, a plan to build out a lot more of the wind. And when doing that, we have done the analysis. If you do that without adding flexibility, or you add 2 gigawatts of flexibility. So 2 gigawatts can, of course, sound a lot compared to the 9 gigawatt on average today, but it's not going to run many hours. Only when there is no wind available or no sun available. So it is about 3% of the energy being generated that is going to be with the flexible engine power plants.

So again, these are very low numbers, 3%-4%. And the numbers I've always thrown around were 2 to 4%, so I'm enjoying this because you're confirming my priors. And what you're saying is, if you don't have that, there will be times when, according to the models, what happens? Because you've got that hydro, why can't the hydro provide those two gigawatts of flexible supply?

Hydro is very good in doing flexibility, with the hydro generation. But you need more, in addition to what you have. Because you only have 15% hydro, and it's very difficult to build out hydro today in Scandinavia and the Nordics. So when you increase the amount of renewables, you need to balance that with flexibility. And you cannot easily build out hydro.

Is it because there are some super peaks, maybe when it gets cold and you've got heat pumps. Is that what's happening in Finland? The capital cost of hydro, I'm guessing, is much, much higher than the capital cost of reciprocating engines that you sell. So is that the point? That is only needed for such a short time that you need to reduce the capital cost?

Yes. So typically in the Nordics, we have a couple of weeks every year where it's very cold and there is very little wind, and that's when you need extra flexibility. And of course, you need to do that at as low a cost as possible, and also what is possible to permit. And that's where we see that flexible engine power plants can be that alternative, in order to support the build out of the renewables.

Okay, so is that a dunkelflaute — what the Germans would call the dunkelflaute? It's in the winter, so there's very little solar, and the wind suddenly drops, and it leaves you with a relatively short-term problem, but it is a couple of weeks.

We always have a high pressure being parked over the Nordics when you have no wind. And as you say, the sun doesn't work very well in the winter because it's quite dark.

But it's good skiing weather, right? Because it's very sunny. I mean, it's winter sun, it’se not very strong, but it's the best skiing weather right? So why don't you just tell the Finns that they should all go skiing? Electricity demand side response, we’d call it.

I think that we have all the industries and schools and other things that still have the demand.

So with those two examples, you've got Chile, you've got Finland. Come back to your global picture. Does that kind of cover the range of different situations? I mean €65 trillion still sounds like a very big number. Where does that €65 trillion of savings come geographically?

So, I mean, this is a global study we made. We took all the generation around the world and all the demand, and looked at what happens if you do a fundamental build out of renewables and storage only, versus being pragmatic and also adding the flexible engine power plants.

Does it include getting rid of the last 4%? Or do you stop short at 4% for the €65 trillion of savings? Because it does feel like those last 4% could cost some trillions, that’s very difficult.

So on the global level, it's slightly higher than the 4%. So it's closer to 10%, if you look at the global level. And that depends, obviously, on the power mix, because if you took Finland now, there is a lot of nuclear and hydro, and if you took Chile, you have a lot of solar and wind. So of course, there are these countries where you don't have the same starting point. And therefore we have looked very much at fulfilling the 1.5°C degree commitment until 2050 when we did this global study.

But does your €65 trillion of savings include going all the way to net zero? Or does it stop at that 10% short? Or does it matter because you'll have to do that last 10% anyway?

It only goes so far as to fulfill the 1.5°C that was the base for the study.

Let's talk about, we've said flexibility, and hopefully, as I say, I've always agreed, so I'm not a difficult audience here… but why reciprocating engines rather than Open Cycle Gas Turbines — OCGT — because I've been doing this for 20 years, and until your team started to persuade me otherwise, I assumed that for this flexibility, the best thing was an open cycle gas turbine. So why would anybody buy a reciprocating engine, which, in my book, at least historically, I've always thought were sort of clunky and old school and not as efficient and so on.

In fact, the medium speed engines have higher efficiency than the OCGTs have. So that's one reason that it's actually better efficiency and therefore consumes less fuel. The other thing is the flexibility, so with the reciprocity engines, you have much better flexibility to start up the shutdown. The minimum on time and off time is better than it is with the turbines. And thirdly, if you go to a country which is very hot, you actually have full performance from minus 45 to plus 45 degrees Celsius. With the turbines, you start to taper off when it gets really hot and when you need it for the air conditioning demand that you have. So I would say these three are the main reasons why engines are better than turbines.

Okay, so the reasons are being more efficient — which is a surprise to me, I'll be completely honest — better ramping up, and flexibility in performance and then a wider operating envelope.

Yes.

What about maintenance? It strikes me that I suppose I would historically have always thought, well, there's probably more people who can repair a reciprocating engine than a turbine around the world. That might not be true in all the advanced economies. But is there a maintenance difference or not?

I think that there is a maintenance difference. If you use the flexibility to turn on and turn off many times. And we have seen, we have examples today where our engine power plants start up 1,000 times a year. And if you do that with gas turbines or with OCGTs, you have extra maintenance, and your maintenance cost increases for every start and stop. And especially if you do short minimum on times and off times. So this is also an advantage that you can do this flexibility that the system needs, and still not have more maintenance than if you run flat out.

Okay, so let's do disadvantages. There must be some disadvantages, otherwise nobody would ever buy an OCGT. What about: you call them medium speed engines. These are, and I think for the audience, can we just describe one of these things? Because not everybody has an engineering background. I've hung around in generator plants. And if I go to an island on holiday, I always want to know where the power comes from. And I end up looking at some Volvo or Wärtsilä or something engine. What do they look like?

Oh, so these engines are between 10 megawatt and 20 megawatt in size, and they are big. They have a high weight, and they are big — so to say — compared to the normal engines that people have seen. So you also have high speed engines.

But just to put them in context, this is similar to the engine in a cruise line or a ship. So that's why you have a marine division

So the technology is basically the same for marine and for energy. So we have a common supply chain, and we have a common factory where we make engines both for the marine side and for engine power plants. And as you say, for cruise ships or for offshore vessels, it's the same type of engine. In energy we normally use more cylinders, so it's longer than what it is in the marine side.

And what fuel? Because in marine it would normally be burning fuel oil, shipping fuel oil now low sulfur, but formerly not. But yours are principally using natural gas, correct? Certainly fuel flexible.

So we have all kinds. We can do all kinds of fuel. So if you go historically, we have also used a lot of diesel. Today, the very, very vast majority — 80% — is gas today, natural gas, because if you have natural gas available, like in the US, and US is our biggest market today, we use gas. But there are, of course, small islands and other places in the world where you don't have access to gas, and then you can still use other fuels,

But if you're using gas, then we need to talk about slip. And for the audience who doesn't know what slip is, slip is when you've got unburned fuel, unburned natural gas, methane in the exhaust, which is very bad for the climate. So methane is an extremely powerful greenhouse gas, and you're using gas where you've got, first of all, losses upstream, which could be a few percent, and then you've got slip coming out of your engines. How much slip are you claiming now?

So first of all, we have improved the slip a lot in the last 20 years. But there is, of course, slip in the engine.

What sort of percentage? And does it go up if the engine is used flexibly? My sense is, engines generally perform well when they're at some optimum power, but then if you keep switching them on or off, or load following, then you'll get more slip.

No, no. So the advantage with an engine power plant is that if you have this 10 megawatt or 20 megawatt engines, you also always have multiple engines. So you can have 10 engines or six engines or 20 engines. And the advantage is that you can always run them optimally. So first of all, they are already quite good in varying loads, so 50% and upwards, they are good. But you can also turn off engines if you don't need them. So you can always run them in a very optimal way.

So you keep them in the sweet spot, which, of course, if you've got a much bigger OCGT, you can't. You have to actually run it at part load, which it doesn't like exactly. Okay, so you're in the sweet spot. How many percent slip?

So our slip level is well below 1%, and we continue to work on reducing the methane slip.

Because the context here is, of course, if you have 3 or 4% methane loss across the whole value chain, from extraction through to use, then you might as well just burn coal or oil or whatever, but you're confident you're not in that zone.

We are. We're less than 1%

I asked ChatGPT, ‘why would anybody buy an OCGT?’, given that reciprocating engines seem to be better on, at least all the dimensions that it came up with to start with. And it said, they use more water and they use more land area than an equivalent power output of OCGT.

So not quite right. So yes, if you look at the density, there is a disadvantage compared to the turbines,

Special density?

Yes, but if you look at the water, that is wrong, because we're using a closed-loop system. So we are hardly using any water at all on engines because it's a closed loop cooling system.

Cleaning Up is brought to you by members of our new Leadership Circle: Actis, Alcazar Energy, Davidson Kempner, EcoPragma Capital, EDP Portugal, Eurelectic, the Gilardini Foundation, KKR, National Grid, Octopus Energy, Quadrature Climate Foundation, SDCL and Wärtsilä. For more information on the Leadership Circle, please visit cleaningup.live, that’s cleaningup.live.

For an unwell or premature newborn, a power cut can be the difference between life and death. For the past eight years, I've been working with the medical team at the Government Hospital in the city of Bo, in Sierra Leone, to support their neonatal special care unit with a solar and battery mini-grid. Now with reliable electricity, the unit is able to save literally hundreds more lives every year. In February, producer Oscar Boyd and I went out to visit the unit, see how the system is working and assess what could be done to maintain and expand it. The resulting documentary episode of Cleaning Up is very moving. Please watch it. You'll find a link in the show notes for this episode.

Let's come back to this moment in history. We've talked a lot about decarbonization, where there's perhaps a moment of reset, where we get to be pragmatic. But the other thing that is going on is a much greater focus on resilience, for lots of reasons. Russia's invasion of Ukraine, we had a power cut in the UK a couple of years ago. That meant people couldn't get home from work. We've talked about Chile — there was a big power cut in Chile just a couple of months ago, and then last week, this power cut that swept across the Iberian Peninsula, Spain and Portugal. And a lot of people have said it was the renewables and this shows how foolish relying on variable renewables is, and we must stop that. And they've all got their favorite technology that they promote. So let's talk about resilience. First of all, was it the renewables?

So first of all, I think that the conclusion is not drawn yet of what was really the cause. The investigation is still ongoing, so I think it's premature to draw a conclusion, but what we saw, when we looked at what happened, was that there was subsynchronous oscillations between Spain and Central Europe, and there is a quite weak link between Spain and France. And then we saw that there were also two solar PV farms in Spain that were shut down. And let's now see what was causing and what was the effect of this? But what you can say is, of course, that when you study and do the modeling of a system which is complex and where you add a lot of renewables, you have, of course, to plan the system accordingly, to make sure that you have the flexibility, as we talked about, already in the system, but also that you have the inertia and the short circuit currents in the system. Because when you add renewables, you will have less turbines and coal power plants, where you have a lot of inertia in the system and short circuit current. So you need to plan for that, and there are ways of adding that with synchronous condensers, or what we can do with our engine power plants, we can have a clutch between the generator and the engines and thereby provide the synchronous condenser functionality with the generator of the engine power plants.

This is great, again, a lot to unpack there, and we're very privileged — I feel very privileged to have a proper electrical engineer that I can ask all my stupid questions of. So you talked about the frequency — what did you call it? — between Spain and France.

Subsynchronous resonance.

So what is sub synchronous resonance?

So that is actually that the frequency in Central Europe and in Spain is not synchronized exactly. So it's actually oscillating between these two countries.

So for those watching on YouTube, they will have seen Anders doing things with his hands going up and down, different hand, different time. But for those on the podcast, what that means is that we're trying for a 50 hertz system, but no system stays exactly on 50 hertz, because if there's too much load, it slows down, and too much supply, then it speeds up. And what you're saying is, instead of doing that at the same time across all of the regions of Europe, you've got Spain where it's dropping and France where it's going up, and then vice versa. So it's kind of galloping, almost. And was that apparent before anything switched off?

So what has been seen is that these oscillations were there. And then, as I mentioned, there were also two solar PV farms in Spain that shut down. And what was the cause and the effect? I am not aware of that yet. That will be seen by the investigation.

Power stations shutting down is a pretty normal thing. I mean, all power station, any type, in fact, there's been situations where nuclear, big power stations, have fallen off the grid, bringing down gigawatts in a few minutes. So this isn't something that's a renewable problem — even if it was the two solar farms that shut down first, the system ought to be able to cope with that. Ought it not?

If the system is designed in a resilient way, it should, of course, be able to cope with that.

Because I think the other thing that happened was at that point there's too much load for the generating capacity. So the frequency drops, and then it looks like a lot of other power plants drop out — a lot of solar, because solar was providing 60% of the power at that time. So it happened that it was a lot of solar, but it would have been anything. It all dropped out. It dropped out it looks like at the same moment, which seems a bit foolish, to have it all trigger at the same exact point.

Yeah, but I think that normally, there are limits of where you have to decouple from the system if you're outside a certain frequency.

49.2 hertz, or 48.8 or whatever you set it at. But should you have all the power stations set to drop out at the exact same time, at the exact same frequency. I'm just put in mind of, I think it was around 2007 or 2008 where, in Germany, they discovered that the software that was in all of the solar rooftops all triggered at the same frequency. So you could have this very unpredictable, very uncontrollable mass switch off at the same point, and then there was a change to the software that was mandated by the grid operator.

So apparently you should not, in that case, have exactly the same trigger point, so to say, for when we shut off the power generation.

Because what's interesting is, there are these people saying you cannot run a grid without fossil fuels. It seems to me that you cannot run a grid without a plan.

I think that's more like it, because you can run without fossil fuels and the traditional generation. But of course, you have to plan it in that way. And I know that in the UK, for example, there has been added inertia and short circuit capability in the form of synchronous condensers, etc, because the grid operator has seen that is needed by the system, and there have been specific auctions. I also know that from our side, we also have grid-forming battery storage as well to help with the grid. So there are things that you can do in order to get the system without, so to say, the old traditional rotating masses. But you have to take extra care, and you have to see this when you plan. So you need a plan for how to deal with this when you shut down the coal and CCGT, et cetera.

So there you have it, folks. This is not just an electrical engineer, but an electrical engineer whose business it is to sell engines, saying that you can run a grid without fossil fuels, but you do need to have a plan. He's of course, also saying that it'd be a lot more expensive to run fully without fossil fuels, certainly in the near term. So there's that flexible capacity that helps a lot, as we heard earlier in the conversation, but you cannot run it without a plan. You've used another few words that I'd like to unpack. You've used synchronous condensers and grid forming and so on. So what is a synchronous condenser?

So a synchronous condenser is an electrical machine which has a lot of inertia, and by having this inertia, which the system needs, in case you have a fault, you can also provide a short circuit current, which is needed in order to trip the system when it needs to be tripped. So you need inertia and short circuit currents in the system, and that capability. And the problem is when you only add renewables and you take out the traditional power generation, you will have too little inertia and too little short circuit current. So then you add this rotating generator in the system which can provide this inertia and the short circuit current in the system. And that's the synchronous condenser.

In many ways, it's like a generator, and your generators actually can also work as synchronous condensers. But if it's purely a synchronous condenser, it's not generating power, and it's not absorbing power, it's just spinning, just sitting there, spinning, sitting there, spinning, synchronized with the grid. And then if the grid starts to slow down, then it starts to generate. And you talked about short circuit current. That's very interesting, because what's happened is you get this Iberian power cut. And by the way, the same thing happened in Australia, in southern Australia, I think it was 2016. And in Texas in 2021, and immediately there are enormous numbers of experts in inertia, most of whom have studied marketing and public policy and law and all sorts. But they suddenly come out of the woodwork, they know all about inertia, but none of them have a clue about short circuit current. What is short circuit current?

So when you have a fault in the system somewhere, you need to have enough power to drive up the current in order for the breakers to open up, and for the relays and the protection system to work. That's why you need the short circuit current in the system.

So you’ve got a fault, you could have current disappearing into the ground somewhere, and so the voltage is dropping, and a load of resources are switching off. And what you're saying is you now need something that can actually provide quite a lot of current.

To clear the fault in the system, so you get rid of the fault. Otherwise you still have the fault there, and something will break eventually, but you want the protection equipment to clear the fault as quickly as possible.

And the protection equipment needs voltage and current.

Yes, you need a certain current to open up the breakers.

I make fun of some of these armchair experts, because it is just complicated. When we say we have to have a plan. I mean, it's an engineering plan. And you know, my sense is you have a lot of people sitting in legislatures around the world, mandating this much battery and mandating this much inertia, but it really needs to be a bunch of engineers making those decisions, in my view.

Absolutely you need to study the system and understand the system. But I think that the grid operator in each country has a very good view of what is needed, and they are the true experts on the transmission system and what needs to be there.

I know that in the UK, what was then National Grid ESO, which is now the National Electricity System Operator — NESO — because it's been separated out — they've been planning for this for over five years: How do you actually run the UK grid when you don't have coal or even CCGT on the grid? It's not something that you decide and do overnight. This is kind of complicated stuff.

And it's also long term planning that is needed, because this is a plan over many years, and it takes time, of course, to adapt the system. But I'm sure that the grid operators know this very well, and they are planning for this in each country.

Well, I think the grid operators in Spain and Portugal might have had a bit of a crash course over the last few weeks, but I did like one of the things which flew past quite quickly in your first description that I said we must unpack. You said your engines also work as synchronous condensers, because you've got the engine bit and then you've got the generator bit, and you mentioned a clutch.

Yeah, so there is a clutch between the engine and the generator, when the engine is not used. Because if the engine is used, you have that inertia in the system. But when the engine is not used, you use that clutch, and you can still leave the generator spinning, just like you have with the synchronous condenser, a pure synchronous condenser. So you can also do this functionality with the generator.

To be fair, you could use that with a generator attached to a CCGT. You can have a clutch or OCGT. So it's not to do with the reciprocating engine. It's to do with how you design. And presumably what the grid operators need to do is tell people to do that, maybe make a market or pay people to, because it presumably costs a bit more to have a clutch than not to. Okay, so there's a resilience implication, not just around when it's not windy and sunny, but also riding through faults. It was one other thing that became very obvious with the Iberian power cut. But also we had an incident in the UK just a few weeks ago where one substation burnt and Heathrow Airport was down for 24 hours. It seemed to take an inordinate amount of time to bring an airport, a single airport, back up and running. In fact, they got the whole of Spain and Portugal back up and running from a near, what they call a black start. It wasn't fully black, but a near black start. They got that back up and running faster than a single airport, which is quite extraordinary. What is a black start? Why is it hard, and how do we deal with it? How do we accelerate? How do we restore power more quickly?

So first of all, I should say I don't know exactly why it took long time in Heathrow to get the power back.

If I could, the quick version of that is: I don't think it was electrical engineering. I think it was a lack of preparedness of the businesses in Heathrow to get their systems — baggage, handling, retailing, security — to get that up and running was the problem. The electricity could have been restored very, very quickly from another substation.

Because normally it should not, as you say, take that long. But what we can say is that with our engine power plants, we have the black start capability, so to say, built in. So it's easier to restore the system if you need to if you have engine power plants that can start from zero.

And why is that a difficult thing? I mean, don't you just kind of let everything start back up? What's the difficult bit? I'm addressing my best electrical engineering resource here.

Because if you have power converters, like you have with renewables, you need to be able to have grid forming power converters. It's not just following where the grid is. You actually need to form the grid. And that is more difficult.
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Grid forming being setting the frequency?

Yes. So most of the power converters today in wind or solar don't have this capability built in. So that is something that's important.

Quick question. Maybe it's an aside, but, I mean, you also spent a lot of time in your career with Orsted. I'm sure you know the answer. Why are wind turbines not used in that way? I mean, they're spinning, they're doing this. Why could they not be contributing to grid forming?

Because they have the power converters in between the wind turbine itself and the generator that you have in a wind turbine and the grid. So that is something you need to have, too.

So there’s a good technical reason why wind is not used in that way, although I understood that it could be that we could have made different decisions.

You can have a battery storage today with the grid forming capability, where you can help in starting up the system again.

So we're going to need, essentially, a lot of batteries and a lot of synchronous condensers, and that's the way we can largely avoid this? But also we have to keep an eye on this grid forming capability to get back up and running quickly if I've understood correctly? Correct me, if I’ve not.

So we have, actually, one case in Scotland with Zenobe, where we have supplied grid forming capability of battery storage, here in the UK.

Let's just switch, if we might, to the markets you've mentioned. The US is your biggest market, and there's this tariff war going on. Are you having to sort of replan? Are you having to respond? Are you playing wait and see, because everything seems pretty fluid?

So first of all, I think that let's see what is the outcome of these tariff discussions that are ongoing now. They have been imposed for a certain time, and hopefully there will be clarity on what the tariffs will be going forward. I think the biggest problem is the uncertainty that this is causing, because nobody knows what to expect, and as long as our customers don't know what to expect, it's of course more difficult for them to make business decisions and investments decisions. So we are waiting to say and see. And we're studying this very closely, because on the Wätsilä energy side, our major market is the US. So for us, it's very important what is happening with these tariffs, and obviously we are hoping, like most industries around the globe, that there will be very low tariffs and that we can continue to do business without building up fences around each country, in our region in the world.

Are you stocking up? Or are your clients stocking up on spare parts? Because right now there is a 10% tariff, but it could, in the remainder of the 90 days, go up to a much higher tariff. So is a stock being built?

No, we don't see that there's been an over purchase of spares. So we see business as usual on the service side. And also on the new build side things continue very much on the engine power plants. We have seen on the storage side that customers are waiting for what is the decision? Because on the storage side, of course, as for most suppliers of storage, there’s a lot of batteries coming from China, and there, the tariffs are very high. So we can see that customers are waiting, so to say, for this to settle before they make any decisions. But on the engine power plants, there is, at the moment, only 10% tariffs. So business is going on as usual.

And how much of that business is driven by AI data centers. The other big topic du jour today's big topic? Because there are some enormous waiting lists for turbine based power plants that these huge AI data centers need. So do you think what you're seeing is kind of a mix of AI data center owners buying like crazy because they have to, and everybody else waiting or stopping because of the tariffs.

No, so I think coming to the AI boom, we also look at different forecasts, and I think you had a episode on Cleaning Up on that, and we see also the huge difference, especially in the US, where you have FERC, maybe on the lower level, both their pessimistic and optimistic scenario is quite low compared to McKinsey, which I think was one of the highest. So you have a huge difference in the outlook of what is needed for AI data centers in the US. But what we can see from our side is that there is a lot of interest in buying engines for these data centers. Traditionally, data centers have been very much connected to the grid, and you have had high speed engines because it's really only for backup, so you don't use them. And then it has smaller engines and high speed. But now when the data centers grow in size, we're talking — instead of 50 megawatt or 20-50 megawatt — we are maybe talking 50 to 250 megawatts with AI. We see that this is more the sweet spot for our engines, and many of the data centers cannot get the grid connection, so they really need to run with natural gas and engines or turbines for the first years, at least until they can get the grid connection. And this could be five to seven years. And then you need better efficiency and more power to do that. So this is really in the sweet spot for our engines, and we see a lot of interest at the moment from customers that want to have this island mode for the first years at least.

So a lot of interest? Or a lot of purchases? Let me push you.

So today in Europe, we have three projects where we deliver to data centers. In the US, we still don't have first order for data centers, but we are in, you can say, quite advanced discussions with several customers in the US.

Okay, so there we have it. We can now add data centers to this moment in history. We've got something of a potential reset on decarbonization, maybe a new pragmatism. We've got a definite new focus on resilience and maybe a whole new area of activity for your products around these data centers if it is near the upper end of those forecasts, which would then definitely be a big opportunity for you. So to wrap up with that context, if you had one final message for the audience of Cleaning Up, what would it be?

I think that we should look at the energy transition in a new way, where we basically say, what is a pragmatic way of reaching sustainability that is affordable and resilient and sustainable, of course. And then we should look at this in a holistic way, to look at the whole system. And what I explained with the flexibility that is needed in the system in order to have a good way forward, both on the affordability, but also sustainability and resilience of the system. That is what I think is needed.

So perhaps a little more sort of Scandinavian approach to it, because I see Scandinavia as being very committed to the environment and to doing things right, and to doing it in an equitable way, but also very pragmatic.

Yes, and looking at it holistically.

I don't think we can argue with that. Thank you so much for spending time with us today, Anders, it's great.

Thank you.

So that was Anders Lindberg, president of energy and executive vice president at Wärtsilä. As always, we’ve put a link in the show notes to resources that we mentioned in our conversation. So that's Episode 206 of Cleaning Up with Michael Lewis, CEO of German gas giant Uniper, Wärtsilä’s global power systems modeling report Crossroads to net zero, in which they analyze the benefit of including a modest amount of flexible generation in reducing the cost of net zero. And a link to the best and most recent information on what actually happened in the Iberian power cut. And with that, I'd like to thank our producer, Oscar Boyd, our video editor, Jamie Oliver, and the growing team behind the scenes that makes all this happen. Please join me at this time next week for another episode of Cleaning Up.