"The future is already here; it's just not evenly distributed."

           —Neuromancer, by William Gibson

The first transatlantic underwater cable was completed in 1858. That's a few years before the Battle of Bull Run—the maiden battle of the Civil War. The cable allowed for telegraph transmission, connecting the UK and Americas, and cut communication time from 2 weeks to 2 minutes. Check out the commemorative stamp with Neptune and a mermaid:

But the cable permanently failed shortly after it went live. The next one snapped halfway into the laying process across the Atlantic. The technology was called a scam by protectionist politicians, businessmen, and people following them. The media and newspapers (which international telegraph transmission certainly benefited) were called into question, accused of dishonest and excited headlines on the viability of the nascent technology. The reliability of boats was better—so went the status quo thinking—and steam power designs were making them faster. The transatlantic cable concept was very nearly abandoned, ultimately hinging on government subsidy from both the UK and US governments to complete in permanence. The subsidy was fought hard, especially in America, lobbied against by the steamship route operators of transatlantic mail. In America that subsidy passed by a single vote in the Senate. Cable technology exploded shortly after, scaled globally, was refined with Telegrapher's equations, materials science, bandwidth increases, lead to many discoveries about electrical transmission, batteries, etc.

Now holding our thumb down on the fast-forward button>>

Interconnectors:

Viking Link is an enormous achievement for HVDC (High Voltage Direct Current) power lines. It was completed a few weeks ago. She runs 475 miles underwater, connecting the British national grid's lips to Denmark, and at peak, can lactate 1400 megawatts of milk from renewable glands, enough to power 1.4M United Kingdom cradles.

This is the global dairy pattern that answers half the energy intermittence problem. The other teat is where energy storage solutions come in. First:

As the world switches from century-old AC power lines to High-Voltage Direct Current lines, larger distances get covered, less energy is lost in transmission, and these interconnectors as they're called, connect the energy grids of different countries, acting as super-highways to ferry renewable energy where it's needed most, where demand is highest, where prices are most favorable. This isn't theory, it's happening.

Eventually, much of the world will have interconnected grid(s). The concept is powerful, nothing new as some of you know, because with interconnectors, you can leverage time zones and overproduction to distribute renewable energy intermittence.

It's not just sunlight, but wind schedules, overabundances of geothermal, and hydroelectric milk. And then, combining this system with milk bottles (energy storage solutions), like say chemical batteries, gravity batteries, hydrogen via ammonia, etcetera—as these technologies develop and mature—then suddenly Buckminster Fuller's vision at the World Game simulation in the 1970s becomes reality, where the highest priority on the dymaxian map is an intercontinental grid ferrying renewable energy. We should also consider the increasing number of people who will opt-out from the grid with their own independent infrastructure using solar, wind, batteries, and geothermal cooling/heating. They can even pump their excess renewable energy into the grid like we see a lot in California et al. We should consider micro-grids too which use the same concept.

Alright, no more misogynous milk analogies, I pinky swear.

The United Kingdom and Morocco are in the final planning stages for the Xlinks infrastructure, a $25B project of "national importance", where several HVDC cables travel 2400 miles (😳) underwater, and connect Morroco's immense wind and sunlight resources in the Guelmim Oued Noun region to the United Kingdom's grid. 11GW....that's almost 4 nuclear power plants worth of energy, for less than the construction cost of a single nuclear plant, with the same build timeframe. FYI, a modern full-sized nuclear plant produces about 3GW, costs about $28B, and takes around 6 years to complete. That's not to say nuclear plays no role, because it does, just not in the *horn-gored way Twitter would have us believe.

*horn gore: violently bullish, as in charts tracing the the inner parabolic shape of a bull's horn

One of the limiting factors of underwater HVDC lines are the cables themselves—there's not enough production capacity yet—which is why I'm heavily researching opportunities in this space. Kind of a FOMO thing for me right now.

We're all used to visible overland cable towers, utility poles, etc, but I'm seeing a bunch of new designs for overland cables that are buried underground. In some cases they're a cheaper solution, bypass fixed legalese, and reduce liabilities (forest fires, injuries, aesthetics, etc). The company SOO Green has a cool model using the space adjacent to train tracks to bury cables and run them to various power stations, bypassing the expensive and timely legal issues to secure land, as train routes are already logistically optimized and legally settled. TransWest, the HVDC overland project that will ferry Wyoming wind power 735-miles to Las Vegas ran into the above ground problem, fighting 18-years worth of court cases; the project broke ground earlier this year. The HVDC project called the CHPE (Champlain Hudson Power Express) will be complete in 2026. This $6B masterpiece runs 1250MW of renewable energy through HVDC lines connecting Quebec and New York. The cables will be buried, and run along the bottom of lake Champlain and Hudson River, again bypassing many legal issues. Anyway, as I've suggested in a previous post, it feels like a referendum on the current mining game for large public miners. Public miners have talking points that are a bit iffy directionally. These companies (not all of course) could see their unique grid positioning challenged, because energy storage occupies the same space, and demand response gets interesting when international and intercontinental grids scale. I wish there was more about this kind of stuff from public miners, about how they'll fuse with energy storage, ratio between what's most profitable in any given hour along with HPC, what work they've done on micro-grid research, how they're deploying debt to achieve this, what inroads they've made with the IEA, what universities they've contracted with, what cool renewable companies they've invested in. But why would they? They've nested their HTML and lobbyists with the GOP while hitching their wagons to the fossil fuel industry. And rehashing a few other miner complaints I have from a previous post:

I have no clue what I'm investing in there. Network security? Transaction finality? Rare Ordinals? I'm not "investing" in gated versions of that. I'll trade them sure, otherwise I'll run my own node, and mine myself, directing hashpower to pools other than Foundry (which I couldn't do anyway because Foundry is by invite only, requiring hashpower minimums, contracts, and hardware purchase agreements). I couldn't care less if many of these miners in their current iteration get themselves specially taxed, or go bust. They heretofore have embraced the short-term benefits of friction. They seem to be following and not leading. Funny, because just a couple years ago I might've suggested the opposite. I'm not going to mince words, and appreciate any rebuttals, but I think the entire industry is on-par with KYC crypto exchanges, mostly bullshit, full of charlatans, and they've made big strides for hearts and minds amongst the bitcoin res publica. Again, I have no clue what they do deserving of an investment, or what their plan is as storage and grid marriage scale. Maybe virtue signaling. They do put out great press for this during grid strain events, and it's usually the same grid.

The industry will eventually consolidate and a bunch of these current companies will get supplanted. As it stands, many American miners have zombied towards the Texas ERCOT grid, which is a unique grid, in that Texas is the only state with an independent grid. This keeps it from most federal oversight. And because ERCOT is adding immense amounts of wind and solar capacity annually, miners can suck it up with favorable contracts, which is good for the time being. I'll posit here (I could be wrong) that the reason hashpower has pushed to multiple ATHs, even with bitcoin's USD price more than halved from its own ATH, is a response to the rapid expansion of cheap renewable energy globally; it's not just the fastest expanding type of energy, but the cheapest, by far per kWh.

Intermittence of renewable energy is the elephant in the room, but assume over the x-axis (time) intermittence gets solved, and conspires to give us advantage, regardless of what fevered noise to the contrary the expedient Twitter personalities cascade. Follow the money, the culture, the snake mating ball of innovation, and data. Natural gas has another term to serve, oil and oil economies on the other hand, are climbing a wall of worry. In some telling so is the petrodollar system. The oil industry and its political cantillionaires straight lied to us. I was watching energy markets as they opened Monday morning after Hamas broke down the gates of the open-air Gaza prison and engaged in pyrrhic war crimes against German tourists, Thai workers, American students, curiously dressed ravers, Israeli civilians, IDF soldiers, children, holocaust survivors, and random motorists. Horrible stuff. So we now have two wars, high inflation, massive reshoring of US jobs, and sanctions grinding three major oil producing nations.

Houston we have a [demand] problem. $85 is lower than oil traded before the war began March of 2022, when homo sovieticus thought a two week timeframe was sufficient for his special military operation. Perhaps Rasputin visited him in a dream and he woke up with sand in his eyes. It's quite possible the United States already reached peak oil demand in 2018, when we averaged 20.5M bpd of consumption. We haven't surpassed that amount in the 5 years since, even with the massive reshoring of manufacturing that we're experiencing. If we're talking about gasoline consumption specifically, then that's fallen off a cliff and I'll bet on a new low in the next 10 years:

We have a bunch of oil refiners who don't want to refine oil for gas and instead prefer transitioning exclusively to petrochemical production. Saudi Arabia and the Emirates are rapidly spending down their sovereign wealth funds to prepare their economies for oil's declining demand. Micro-transportation is revolutionizing urban mobility. Electric cars are growing. I go back to January 2016 when oil contracts fell to $26 bbl, and again in June 2020 when they went literally negative. It'll happen again. Bigger volatility swings. Deeper. High oil prices incentive renewable energy. And people can modify their behavior so fast nowadays (there's a crush of options) in response to high energy prices, that any death spike in oil (and there are sure to be a couple) will be short-lived games amongst marginal buyers. Homo sovieticus learned this lesson the hard way in failing to hold Europe's economy hostage via energy. Interconnectors, innovation, renewables, and perpendicular thinking all got fast-tracked; in other words, the fallout from the invasion is that it hastened the global transition to cleaner forms of energy. Now Russia and their soon to implode currency are trapped fighting against a hyper-efficient war design, where the US defense budget has not only been falling for years, but for a drop in the bucket of that budget, America is dramatically weakening an enemy (Russia), selling energy to allies (EU) for more money than the enemy did, while putting a resource rich country (Ukraine) in debt, and losing no men in the process. It's like an advanced Ai model output an instruction manual for the input: How do we politically embarrass, operationally dominate, and tactically outfight an enemy without ever fighting him?

Ukraine bonds remain one of the hottest investments in the world:

Peak demand for oil globally will happen this decade. The IEA agrees, the integrated oil majors agree, car manufacturers agree, a crush of unbiased studies agree, I agree. OPEC doesn't agree, but that's what happens when you have a 13-country cartel run by 12 dictators. Big chunk of their power is set to expire. I'm done with their well-funded education campaigns. What awaits them on the other side is a bit too distributed for 20th century playbooks. Dictators have been involved in every war, refugee crisis, and hyperinflation event of the last 100 years. They'll all be gone in the next couple decades. Just having to account for them costs too many resources.

I think free/cheap forms of decentralized energy, intercontinental grids, energy storage, and photonics-based silicon will revolutionize bitcoin mining.

I read through Softwar a few months back, the book by Major Jason P. Lowery that caused a stir. I think he took far too much SPITEFUL criticism, it felt like bullying, and you absolutely want young people like that adding to collective intelligence (think wisdom of crowds theory) even if you don't agree. It gets averaged out. I'm guilty of saying a whole bunch of stupid shit on this site and others. But I'm learning. We have to get it all out there. The fact Lowery caused so much outrage was reason enough for me to read it. Besides some of the technical criticisms raised by learned devs, I think power grid marriage is something under-accounted for in his thesis. Some of the other stuff was interesting.

Conclusion: Interconnectors add new layers of cooperation for nation states, incentive alignment, we might see emergent behavior that bitcoin fits right into. The renewable industry is a rabbit hole full of scams, specious ideas, amazing innovation, world-altering projects, political expedience, and opportunities. Take a flashlight down it, the future of energy and mining looks different.

Thanks for reading this abusively long post. Lots of sats for replies as always. You know the rules.