ONS Energy Conference
Questions on ElonsFAQ asked in this interview (3)
Transcript
0:00InterviewerGood morning so far. Thank you for your questions and I want a whole lot more because our next speaker has decided that he doesn't want to give a presentation at all.
0:10InterviewerHe would like to just answer your questions and perhaps a few pesky journalistic ones from me. Can we have chairs brought up?
0:18Elon MuskYes.
0:18InterviewerSo that we can sit comfortably for the next half hour or so. Who is our next speaker? Well, we've been dropping tantalizing hints, haven't we? He's a titan of technology.
0:27InterviewerI understand he's something of a rock star. He here in Norway because. Yes, I think so. Because he has plowed in his initial fortunes from the sale of, for instance, PayPal.
0:42InterviewerDid you know this gentleman was behind PayPal? One of the co founders. And instead of retiring to a comfortable lounger in the Caribbean and spending money on wonderful yachts, or perhaps he does that too.
0:55InterviewerHe's also spent three fortunes in three audacious businesses. Tesla needs no introduction to you. Space City, sorry, Solar City is trying to put solar panels around the world, or at any rate, in all the hot and sunny parts of the world.
1:12InterviewerAnd then we have SpaceX, which has the truly jaw dropping mission of one day transporting us all to Mars. How is this man real? Well, we're going to find out for ourselves.
1:26InterviewerHis initials are E.M. please do send in your questions thick and fast. A big warm welcome to Elon Musk.
1:44InterviewerMake yourself comfortable. Elon, my gosh, we've got so many questions here already. Where do we start? Should. Shall we start with Tesla? Should we do a bunch of Tesla questions?
1:54InterviewerIs that good? Audience?
1:56Elon MuskWell, I thought I'd start off with a song.
2:00InterviewerWell, no, maybe I'll ask you this question rather than Tesla. I'm going to ask you this question, which is from me, not the audience. What exactly are you doing here?
2:08InterviewerYou know this is an oil and gas conference. Why. Why are you here?
2:13Elon MuskWell, Norway's been very supportive of electric vehicles. And so I'm here in gratitude and appreciation for what Norway's done for electric vehicles.
2:24InterviewerOkay, so it's thank you to Norway, I think from Elon Musk.
2:27Elon MuskThank you to Norway. Exactly.
2:29InterviewerSo what is it about Norway then? It's your second biggest market, I understand,
2:32Elon Muskactually, at this point.
2:33InterviewerOoh, someone else snuck in there.
2:35Elon MuskChina.
2:36InterviewerAll right, okay.
2:38Elon MuskThere's some demographic advantages.
2:41InterviewerYeah. So what is it about Norway? Is it the government support putting in all those power stations? What is it?
2:47Elon MuskI think it's a number of factors. Certainly Norway has a lot of incentives for electric vehicles, which are great, but it's worth noting that say, Denmark also has very strong incentives for electric vehicles, but sales are much greater in Norway than in Denmark.
3:05Elon MuskAnd I think in Norway there's a core group of electric vehicle enthusiasts who have really taken it upon themselves to promote electric vehicles and have done an amazing job.
3:16Elon MuskAnd, and as a result that, that has made Tesla sales in a way really, really great.
3:24InterviewerI understand there's one gentleman who owns more north more EVs than any of your customers around the world.
3:32Elon MuskYes, yes, he's in Norvik.
3:35InterviewerHe's an Arvik. Yeah. Okay. How many does he own, do you remember?
3:39Elon MuskThat's above the Arctic Circle, by the way. And he, I believe he owns, I don't know, 12 or maybe 14 now. So his name is Jens Kratholm and he's a very nice guy.
3:57InterviewerA very nice guy. So we have a question here from, from the audience which is when is your next mass market car going to be ready? Because your current one is roughly what in price?
4:08Elon MuskWell, our current one is in US dollars, it's about $70,000. So it is a premium car. And then we're coming out with an SUV version called the Axe that's coming out next year, but also that's on the same platform, so it's about the same cost.
4:27Elon MuskThe car that we're really looking forward to bringing to market is called the Model 3 and that's intended to be a mass market long range electric vehicle. It's the car that I wanted to bring out from the very beginning, but it just takes a bit of time to iterate the technology and complete.
4:43InterviewerHow long? Because I think the launch date has been pushed back and back a bit.
4:46Elon MuskWell, we're hoping for about two and a half to three years. Contingent upon that is completion of this very big battery factory called the Gigafactory that we're building.
4:57InterviewerSo tell us about that.
4:58Elon MuskSure. So the. In order to make a lot of electric cars you need a lot of batteries. And the lithium ion battery capacity of the world in terms of production capacity is really not big enough yet.
5:14Elon MuskNor does it make the most advanced type of batteries that we really need for long range electric cars. So in order to solve that problem, we found there was really no choice but to build a really enormous factory called the Gigafactory, so named because we're targeting about 50 gigawatt hours of output, which for battery energy storage is quite a big number.
5:35InterviewerThat's huge. Yeah. And it sounds cool as well.
5:37Elon MuskYeah, exactly.
5:43InterviewerSo are there any links do you think, between the Battery technology that you're investing in at the moment and renewables, I mean, would there be.
5:50Elon MuskYes, absolutely.
5:52InterviewerThe stuff that you're developing is not just for cars. A bit more about that, sure.
5:57Elon MuskSo about a third of the output of the gigafactory is intended as stationary storage, primarily to be paired with renewables, but also to do grid buffering in non renewable situations.
6:12Elon MuskSo. So that you can operate the plants. Even if it's a hydrocarbon energy plant, you can operate it close to its optimum and avoid having to sort of peak.
6:23Elon MuskYeah. So I think we'll see really a very huge demand for stationary storage and this is really going to help out some of the more intermittent sources like wind and solar.
6:36Elon MuskAnd it's worth noting, I'm not sure if people are aware of this but. But the world could be powered many times over by solar if you had enough battery capacity to pair with it many times.
6:49InterviewerLike the world, I mean obviously California where you're based, but in Europe, can you really say that in Europe?
6:55Elon MuskA thousand. It's literally true. The amount of energy that reaches the Earth from the sun is staggeringly high. We have this enormous fusion generator in the sky that is lobbing out vast amounts of energy.
7:09Elon MuskAnd I'm talking about just using land area. I mean it's really amazing. In fact, here's a little tidbit. If you take a nuclear plant and you took its current output and compared that to just taking solar panels and putting solar panels on the area used by the nuclear power plant, these typically have a big keep out zone, you know, about maybe 5km or thereabouts where building houses, you know, and dense, you know, any kind of dense office or housing space.
7:41Elon MuskUsually people don't want to do that near a nuclear power plant. So there's quite a big keep out zone. And when you factor the keep out zone into account, the solar panels put on that area would typically generate more power than the nuclear power plant.
8:01InterviewerYes. And that's not a conclusion just done by you.
8:04Elon MuskI know you can just. It's very easy to do. So here's a question, if I may sort of just do just a tidbit
8:13Interviewerof math, collective math, 900 people, mental math.
8:20Elon MuskSo 1 square kilometer is a million square meters and there's 1 kilowatt per square meter of solar energy. So on 1 square kilometer there is a gigawatt of solar energy.
8:37InterviewerUh huh. With you so far? With you so far.
8:45Elon MuskSo I mean if you wanted, I mean you can get.
8:48InterviewerAnd ergo the nuclear power station doesn't give you the same. Is that the calculation?
8:52Elon MuskYeah, exactly. But like you could power the entire United States with about, let's say, 150 to 200 square kilometers of solar panels. The entire United States. Take a corner of Utah.
9:09Elon MuskNot much going on there. I've been there. There's not even radio stations.
9:15InterviewerOkay, so the question from the audience then is seeing that your big thrust into Tesla cars, which has taken off 10 years in your big ambitions for solar power, what kind of a threat do you think you are to the oil and gas industry?
9:31Elon MuskWell, I don't think we're much of a threat, I mean, yet, you know. Yes, but I mean the more obvious threat is that we're going to run out of hydrocarbons to mine and burn.
9:46Elon MuskThat's rather obvious. I mean,
9:50Interviewerno time soon, judging from the comments we've had this morning.
9:53Elon MuskWell, depends on what soon means. I mean, it's clearly getting hotter and harder. My understanding is that the cost of extraction is doubled and in some cases tripled. So it's getting harder and harder to find hydrocarbons and it's getting much more expensive to extract them.
10:13Elon MuskAnd really we're just arguing about the when hydrocarbons run out or become prohibitively expensive. Not if. I mean, I don't think there's anyone here who would say it's an if, not a when.
10:27Elon MuskThey will run out for sure. So what will?
10:31InterviewerSo you don't think, I mean, you are, you know, a tech guy, right? You're a physicist and an engineer. You call yourself the chief architect of.
10:38Elon MuskYeah.
10:40InterviewerYou don't think human ingenuity and technology and resourcefulness will mean that we will still have abundant fossil fuels available? I mean, this has been going on. They think you've reached the boundaries and yet they find more.
10:53InterviewerAnd you know, look at the whole shale gas revolution. That was stuff that people said would never be able to be extracted there.
11:01Elon MuskThere are time extensions on the game, but the game is going to come to an end. That should be absolutely certain. Obviously, frankly, I mean, to be in non renewables and it's tautological.
11:15Elon MuskEither it's renewable, it's not renewable. So if you're in non renewables, it's like being you're stuck in a room where the oxygen is gradually depleting and then outside it's not.
11:28Elon MuskSo you want to get out that room and I think the ones that get out of the room sooner will be better off.
11:37InterviewerIs that where the mission to Mars comes in?
11:39Elon MuskNo, ironically, the rockets will use hydrocarbons.
11:45InterviewerQuite a bit, I think. Isn't there an inherent contradiction then here in the project?
11:51Elon MuskNo, there isn't. I don't have any fundamental dislike of, of hydrocarbons. I simply look at the future and say what is the thing that will actually work? And using a non renewable resource obviously will not work, so we must find an alternative.
12:10Elon MuskBut if there was a button I could press to stop all hydrocarbon usage today, I would not press it.
12:15InterviewerYou would not press it?
12:16Elon MuskOf course not.
12:17InterviewerOkay. Did you expect him to say that? You would not press it would cause
12:21Elon Muskhuman civilization to come to a halt.
12:23InterviewerEvery hospital would have to close.
12:24Elon MuskThat would be ridiculous, of course. So it would be irresponsible to press that button. But what does need to happen is to, if we can accelerate the transition towards renewables, that's the sensible thing to do.
12:37Elon MuskAnd you know, if you take, say I'm going to use maybe two examples, Saudi Arabia, since the Saudi Aramco president spoke here. Saudi Arabia has an enormous amount of sunlight and that will be there for billions of years or at least 1 billion years until the sun eventually engulfs us.
12:57Elon MuskBut a billion years, Solid
13:00Interviewerbit more math there.
13:03Elon MuskYou've got a solid billion years there. So it seems that investing in the solar resource is the thing that's really going to preserve the long term future, not so much the oil and gas.
13:19Elon MuskI mean that's a temporary thing. In the future we'll look back. And by future I'm not talking about super far in the future. I'm talking about towards the end of the century.
13:26Elon MuskWe will look back on gasoline powered cars the same way we look back on coal as sort of a quaint anachronism that's in a museum.
13:36InterviewerThat's the quote for you members of the press at the back of the hall.
13:40Elon MuskYeah, but it's true.
13:41InterviewerI think there are some business models that we could perhaps all learn from. And I've been trying to do some boning up thinking. What is it that Elon is doing in his Tesla cars, for instance, in his Solar City ventures, which seem so very different from the oil and gas sector, but which perhaps there is some commonality, some points of learning.
14:01InterviewerAnd the thing that I want to ask you about is patents, patents as you call them now. A few months ago you decided to open them up, make them open source for some key areas of Tesla carbon.
14:13InterviewerWhat is the thinking behind them?
14:14Elon MuskAll of our patents.
14:15InterviewerOh, all of them, okay. What is the thinking behind them? And is that something that perhaps the oil and gas industry should Consider when developing things like say, carbon storage and things like that, very, very difficult new projects, should they get together and just junk the patents?
14:30Elon MuskYeah, I think patents are. I don't like patents personally. When I was first starting out developing technology, I got lots of patents and thought this was a good thing.
14:39Elon MuskAnd then I sort of discovered that a patent was really like buying a lottery ticket to a lawsuit. I was like, I'd rather not buy as much those tickets.
14:50Elon MuskAnd you look at sort of the battle between Apple and Samsung and who's really winning there? You know, the lawyers are winning certainly, but neither of those two companies.
14:59Elon MuskAnd in the case of Tesla, I thought, well, would Tesla ever sue some other car company if they were using our patents to try to make them stop making electric cars?
15:11Elon MuskWe would never do such a thing, so why pretend that we would?
15:16InterviewerBut. And you're not just saying recognizing that internally as a de facto position, you're saying to the world here, have them go for it. Yes. Which is a different thing.
15:26InterviewerThat's going one stage further.
15:28Elon MuskYeah.
15:28InterviewerYes. And that's not just because you think we're never going to sue them. It's presumably because you think there is some business advantage to it.
15:36Elon MuskNo, I really don't know. I mean, if there is, let me know what it is. I'm not sure. You know, I'm all ears. Maybe it will somehow turn out to be good, I don't know.
15:47InterviewerBut you boost the market, there's more investment in charging stations. You know, everybody benefits.
15:53Elon MuskGreat.
15:54InterviewerRising tide lifts all the boats, is that argument.
15:57Elon MuskI hope there is. That'd be nice. I mean, we're really trying to get relevant vantage, but maybe it can help lift the industry as a whole. And I think it generated some goodwill and I think maybe that goodwill is helpful.
16:08Elon MuskYou never know where that pays off.
16:10InterviewerOkay, so there's an idea for all of you here at ons. You know, think about patterns. Do we have to be quite so possessive about them? So kind of secretive?
16:19InterviewerIt's an idea. I want to throw another thing at you. We haven't really spoken about space exploration very much yet. And we have a question from a young man called.
16:29InterviewerLet me see if I've got his name right. Goethe. Mudson. I hope I've pronounced his name right. He's 37 years old and he's saving up to go to Mars.
16:38Elon MuskOkay.
16:39InterviewerYes. And he says he's on average earnings, which is probably quite high here in Norway. And he says how long is it going to take him before he'll be able to make this mission a reality?
16:50Elon MuskWell, I think the critical threshold is what's the cost of moving to Mars? What's the ticket for moving to Mars and what's the threshold ticket price below which a self sustaining Martian colony would be established?
17:08Elon MuskAnd I suspect that is somewhere on the half a million dollar level. So obviously we'd like to have it be lower. But I do see a path to being able to offer tickets for someone to move to Mars.
17:22Elon MuskAlso they get a free return ticket if they don't like it. So it's so trapped there. And I think if we can get that threshold below half a million dollars, which is the price of middle class home in many parts of the US
17:39Interviewerthen So you have to trade in your home.
17:41Elon MuskYeah, well, if you're moving to Mars, it's not a vacation.
17:45InterviewerAnd what's the time span on this? Two, three, four decades?
17:50Elon MuskYeah, I think we should be able to hopefully send the first people to Mars in about 12 years. And then it's going to take 12 years.
17:57InterviewerHaven't you brought that forward from your previous. No. Has it always been okay, 12 years? Wow.
18:03Elon MuskRoughly. And then probably double that to get again to get to where the cost is reduced to the half million dollar level. So it's probably, probably 25 years. Ish.
18:17InterviewerThis is dependent on obviously technological advances and cost effectiveness. Now you've already been able to put a number of vehicles into space, supplying NASA, supplying the International Space Station with cargo, and your main bid was bringing down costs dramatically.
18:36InterviewerYes. Slashing costs by what, a factor of
18:39Elon Muska third what it's compared to. We're about, we're about a third to a quarter the price of Boeing and Lockheed, which are our domestic quarter competitors in the U.S.
18:49Elon Muskand probably, I don't know, 60% of the price of the Russians or the Chinese.
18:59InterviewerAnd this is rocket based in California, which is not exactly a low cost
19:02Elon Muskproduct manufactured from scratch in Los Angeles County. So necessarily this cannot be a function of labor cost because the labor cost is very high.
19:12InterviewerSo facing an audience of people who are grappling with costs, we heard Carla Del Fala talking about how cost of exploration has doubled in the last decade. We've been, it's something that's bubbling along here.
19:25InterviewerWhat advice can you give them? How does one go about really reducing the costs of a venture?
19:31Elon MuskWell, you have to innovate, you have to do different things and there has to be a tight feedback loop on innovation. And one of the things I think is advantageous the way that SpaceX operates is that the engineering team and the production team are in the same facility and there is good communication back and forth.
19:49Elon MuskSo as the engineers see that they've designed something that is difficult to manufacture, they can adjust their design quickly to make it easier to build. And at the pace at which we're able to do new versions of the rocket is also much faster.
20:04Elon MuskSo innovation, just improving things is key.
20:07InterviewerBut you know, that actually sounds lovely and everyone talks a lot about innovation.
20:11Elon MuskThere must be an expectation.
20:13InterviewerWhat can people take away from? There has to be an expectation, establish
20:15Elon Muskan expectation of innovation and the compensation structure must reflect that.
20:21InterviewerSo you're basically incentivizing innovation and cost reduction.
20:27Elon MuskYou have to incent it. Yes.
20:28InterviewerDo you have to do the Henry Ford thing, which is every year you just expect the price to come down and the cost to come down. And that's just a kind of directive from above.
20:39Elon MuskSo there needs to be an expectation of innovation. The compensation structure must reflect that. There must also be an allowance for failure because if you are trying something new necessarily that there's some chance it will not work.
20:54Elon MuskSo if you punish people too much for failure, then they will respond accordingly and the innovation you will get will be very incrementalist. Nobody's going to try anything bold for fear of getting fired or being, you know, punished in some way.
21:09Elon MuskSo there must be. The risk reward must be balanced and favorable, taking bold moves, otherwise it will not happen.
21:22InterviewerIs your door open to members of the oil and gas industry to come and see what you've done to really engineer costs out of, out of SpaceX?
21:34Elon MuskYeah, I mean there's some limitations of SpaceX because it's considered an advanced weapons technology, but within the route balance of what the US government will let us do, we're more than happy to show people around.
21:47InterviewerFantastic. Thank you.
21:48Elon MuskBut I forgot I was going to give two examples. One was Saudi Arabia, another one was Norway because it seems that that's appropriate for given the venue. Norway has tremendous natural resources in terms of hydropower also I think wind and potentially geothermal.
22:06Elon MuskAnd I really, I think there's a huge opportunity there to expand, expand those renewable sources and provide that power to the rest of Europe. So I think that really, I think would be a wise thing to do.
22:22InterviewerAnd you need it really, don't you? Because we need to clean up power generation for EV cars to be truly clean. If they're still being powered from coal fired power stations, then your EV product is not ultimately that clean, is it?
22:36Elon MuskYeah. Norway of course already has a lot of hydropower But I think expanding upon that would be wise.
22:46InterviewerGoing back to SpaceX, we have a question here from Christian Rungen who sent it in on Twitter. What collaboration do you see between SpaceX and the current oil industry in space exploration, for instance, asteroid mining.
22:59InterviewerAsteroid mining, drilling on Mars. There are commonalities.
23:05Elon MuskYeah, well the. As I said alluded to earlier, I mean rockets do burn hydrocarbons or they can burn just hydrogen as well. But the most likely Mars architecture that I think makes sense is a methane oxygen system.
23:28Elon MuskMethane is the lowest cost source fuel on Earth. And with rockets you can't really make it rocket electric because it's got to react against something. Once it gets to vacuum, there's no air or land or water to react against.
23:41Elon MuskSo you have to burn something really. So I think a methane based system is going to be what makes the most sense. Once you get to Mars, I think there will be some drilling activity, particularly to find out if we can get to underground lakes, like to find liquid water, you know, water that's sort of heated by the Mars central core.
24:11Elon MuskThat would make it a lot easier to develop propellants on Mars. So. So it's critical to any Mars colonization is the ability to generate fuel on Mars. You need to generate methane on Mars, which you can do because Mars has a CO2 atmosphere and there is a lot of frozen H2O around.
24:35Elon MuskSo you've got your CH4 and your O2. But having that propellant plant on Mars be efficient is critical to a Mars colony.
24:46InterviewerSo perhaps collaborations ahead. I've got one last question which I'm going to sneak in briefly and that is what changes would you make if you were the CEO of an oil and gas major?
24:58InterviewerGood question.
24:59Elon MuskI would invest heavily in renewables. That may sound like an obvious thing to do and there are some companies that are doing it. Total made a huge investment in sun power and I think that investment will pay good dividends in the future.
25:17Elon MuskBut I think it's important to look at renewables and take it really seriously. Don't just put like the C or D team on it, put the A team on it.
25:29InterviewerAre you listening? The A team?
25:30Elon MuskYeah.
25:31InterviewerI want to ask you a personal question, actually. It's from my son. He's 14 and his question to you is what should he study in university to become a car engineer of the future?
25:44InterviewerShould he do physics like you?
25:45Elon MuskI think physics and engineering.
25:46InterviewerWhat should he do in engineering?
25:48Elon MuskI think physics, Physics and engineering are. I mean physics provides a good framework for thinking it has the best framework for thinking, I believe particularly for discovering things that are counterintuitive.
26:00Elon MuskBut then I think also studying a bit of engineering and, and also, I mean I wouldn't completely neglect the humanities as well. I think history, history is important. I think history is something everybody should study.
26:13Elon MuskThere's lessons to learn and if you
26:14Interviewerwere to go for one. I think there's only one boy.
26:18Elon MuskOne boy.
26:19InterviewerMy son. There's one of him.
26:21Elon MuskYes.
26:21InterviewerPhysics. If you to go for one.
26:23Elon MuskYou mean just 14?
26:24InterviewerHe wants a simple answer. Yes, he's 14. He wants a simple answer.
26:27Elon MuskI think probably the best choice is physics, honestly.
26:29InterviewerOkay.
26:29Elon MuskYeah.
26:31InterviewerBear speaks to physicists.
26:32Elon MuskShouldn't just read physics though. There's other things too.
26:36InterviewerElon Musk, it's been such a pleasure having you here.
26:38Elon MuskThanks for having me.
26:40InterviewerWide ranging view of the world and the universe.
26:44Elon MuskThank you.
26:44InterviewerThank you for joining us at ONS 2014.