Could energy from the heavens answer our prayers?

0:00Mike Butcher:Welcome to Path Founders, the new tech media title about code, capital and consequences. With both the rise of AI and, of course, a potential oil crisis looming from the war in the Middle East, the energy that we all consume is now possibly the biggest issue of this half of the decade. Across Europe, demand is rising fast, driven by AI data centers electrification, while the grid itself is under increasing strain. Where are we going to get all the energy that we need? Well, today's guest is from Terraspark, a startup building towards space-based solar power. Long seen as a sci-fi concept, it's now being re-examined as launch costs fall, satellite manufacturing improves, and Europe looks for sovereign energy solutions.

0:52Mike Butcher:Terraspark has just raised over€5 million euros in a pre-seed funding round. And joining us to discuss it all is Jasper Deprez, co-founder and CEO of TerraSpark. Thanks very much for joining. Thanks, Mike, for having us. Well, this just sounds fantastical, space-based solar. And it has been sort of mooted as a concept for a long time. But what's going on? And how do you feel that you're going to be able to execute this? Yeah, so I think when you look at the concept of space-based solar, indeed, it's been already around there from i mean actually really from the 40s and then the same people that put a man on the moon looked at it again in the 70s and already then we knew that technically this was possible but in the 70s really the question was about is this economically viable right and so when you look into how they were doing it back in the 70s compared to the capabilities that we have now a lot has changed yes i mean you've already mentioned it the cost of launch obviously dropped but also So things like in-space assembly, the cost of solar cells, also just the way how we manufacture these satellites, like all of these things have changed, which now makes it a possible path towards making space-based solar also economically viable, not only technically viable.

2:11Carry on. And then the second thing that changed is probably the approach to it. So quite often if you look at these historical systems and you search space-based solar in Google or in chat GPT or whatever, you're going to get these kind of like very giant systems that are kilometer wide and set in geo and that can power 80 % of Europe, which are all fantastic. But these are too large to start. So in Terrace Park, what we're building is the smallest possible space-based solar power company that you can humanly imagine. So we make very small systems in LEO rather than going for the mega systems in GEO.

2:53Mike Butcher:I see. Right. So how are you going to sort of commercialize this? Yeah. So it actually starts already on the ground, because if we're able to send energy from space to Earth, you're also able to send energy like this. So these are already terrestrial use cases. Right. So think about anywhere in the world where it's hard to power something because of a cable. So these could be things in the sea. These could be things in valleys. Mining is a very good example. And then from there, I mean, when we talk about energy from space to Earth, the question is, for who does a certain price point make sense?

3:33so when you send energy from space to earth in the beginning it obviously is slightly higher in price right and as we progress the price drops but so you need to go and match who are those users at a certain price point that are willing to go and pay for that energy that could be in mining to give you an example those could be remote islands but those could also be data centers where the opportunity cost of not having energy is larger than the cost of energy it isn't the problem

4:00Mike Butcher:though that um as cheap as it might become to do this kind of thing from space it's surely going to get a lot cheaper a lot faster doing renewables uh from earth yes but there's this really weird concept called the day and the night and clouds right so um the problem with renewables is and by the way don't take me wrong we are not competing with renewables we need renewables to win and we problem with renewables is that it's not firm baseload energy. So it's not there 24-7, always on. So you're weather dependent or it has to be day and night. And so you're depending on cycles. With space-based solar, we're effectively able to deliver energy in any weather condition and 24-7.

4:47Mike Butcher:So what's to stop Elon Musk coming up with this himself and blowing you guys out of the water? Well, energy is kind of a really big market. It is the biggest market that we have on the planet. So there will be more than one player for sure. So we actually would welcome him. I think it would be a good idea. I guess he would confirm your thesis, I suppose. What about regulation? Because you've all got energy, you've got radio frequency transmission, you've eventually got space infrastructure. Isn't that quite a lot of regulations to deal with? Yeah, no, I mean, there's already a lot of existing regulation as well, right?

5:26So when we talk about what's the power density that you're allowed to bring to Earth, like all these things are regulated already. We operate within the existing regulation framework. And then, yeah, there are obviously topics that we need to move. But there's also topics that just have to be there, like any single energy source has to be safe, right? And so a lot of effort is being made also on ensuring that that is the case.

5:50Mike Butcher:um and i mentioned elon musk as i was being flippered but there are other uh players in the space uh forgive the pun uh uk i think there's a company called space solar um there are others do you feel you have any kind of particular technical technology advantage or perhaps you're a bit further ahead on on funding and stuff like that yeah so so there's different players in there right i think the first thing that we need to really understand is who are we competing with we're competing with fossil right so really we're competing where and anywhere in the world where diesel generator is the current solution that's what we're competing with and we're gonna need more than TerraSpark alone to go and solve that and then as well you have different technology categories I guess right so you have for example reflect orbital that's using mirrors you have organizations like ataflux and overview energy that are going for lasers and then you have a school that is working on radio frequency um these different technology decisions or choices are addressing different markets and different energy needs right so it's it would be the equivalent of saying uh lovable and harvey are competing because both are an ai solution yes but they're addressing different needs in the market um well you've raised um five million euros in the precede round but this is obviously fairly capital intensive industry um what sort of projections do you feel you're going to have to get to to make this reality i know it was also shocking for me right so space tends to be expensive i know it's it's crazy um but i think the first thing that we need to understand is that the the systems indeed are expensive but they are paying themselves off right so that's the first thing that we need to understand um we will be announcing that we will be looking at additional funding obviously right and and capital is obviously one of those those stories that that is uh quite important in an endeavor and this um but we'll be sharing more details on that as we as we progress Right, will that be this year?

8:03Probably, yes.

8:04Mike Butcher:And I mean, another aspect of this is the space race, I suppose. And there's a bit of a competition going on in between Europe and the US. Where do you think you'll be launching first? Wherever we have the cheapest launch. Right, will that be SpaceX, I presume? That could be. I mean, we probably need a second or third launching company anyway, right, to really get the price down as well. But, you know, we will be launching what makes the most economical sense. Do you feel that you're getting enough backing from, you know, either governments or funders for this kind of project? What do you think might be lacking?

8:49Yeah, I actually think surprisingly that we got quite some support on this. Obviously, we want more support, right? So anyone that is watching this, we need more support. Space-based solar is one of those things. If it takes a village to raise a child, imagine what's needed to create a new source of energy. But I think that the environment is the right one. I think the awareness on how fragile energy really is, is becoming top of mind. And I can feel, at least in the conversations that we're having, that the question is not around how much does it cost or is this really needed it's more about when can we have this um which is an excellent indication right it's a good signal to to work with um i mean i don't know if you if you know the story but the the entire reason why terrorist park started was because of the blackout in spain and i don't know mike if you remember but you probably remember a bunch of spanish people partying in the streets that's usually what people remember with the videos um yeah but it was actually quite scary if you think about it the entire spain and portugal were out of energy and i have two small children and in my little village the energy went out for six and a half days and i can tell you six and a half days with two small children really makes you realize how fragile energy and how much it is needed right so i think that the climate is right uh finally to go and pull such thing off and i think it's very much needed as well that we do so i said at the top

10:26Mike Butcher:that um the the confluence of both uh the demand for energy for ai and also the crisis in the middle east and it's feeding into questions about energy supplies um you know is definitely pressure on us all right now do you think this is this is your moment as it were because of everything that's going on geopolitically i mean i think that the moment of energy is is is not only now i think that that is a you know like if you look historically civilizations are built on the amount of energy that they have access to uh we're now at one of those moments in in history where the amount of energy that we have access to versus the demand that we have is not matching and that requires us to rethink how we're going to work around these systems.

11:15And I think that that is a moment where you have beautiful solutions like fusion that are now being very well funded. Geothermal is also making quite big movements. There's quite a lot going on in batteries as well. And space-based solar also fits within that movement. So, yes.

11:35Mike Butcher:You mentioned that you might be able to use space-based solar for things which are relatively off-grid, such as in mining. Would that also apply to, say, data centers out in the middle of nowhere? Yeah. So I think the question that should be asked is that if you're not depending on the grid, or if you do not have to build real estate where the grid is and you can build it anywhere, how would we operate? yes data centers is a good example another good example is desalinization right of water is a very good example but really like even in mining there's a lot of precious material that we need but we don't go and mine in these places because getting energy to these places is simply very you know uneconomical yeah okay but if that is no longer an issue how would you operate differently and that's really the question that we're that we're answering with TerraSpark Well, we'll be watching your progress with interest.

12:33Mike Butcher:I certainly hope your solutions arrive sooner rather than later, especially given what's going on. But for now, we'll leave it there. Thank you so much for joining Path Founders, Jasper Debrez, co-founder and CEO of TerraSpark.