Season 2 Ep 3 – Beyond Green: Why Energy Storage Is the Rental Industry’s Game-Changer

Kevin Sturmer 0:00
Coming up on Leading the Charge.

Michael Larsen 0:02
We’re really starting to see genuine performance at the end of the day, and an unbelievable track record and proven case studies, especially what you guys have achieved at POWR two and a lot of other manufacturers are achieving globally. So I think from the perspective of what’s next and what’s on the horizon past 2025 I think we’ll see and will love to see a continued movement and continued progression from just satisfying not only sustainability, but also generating profitable business models within rental businesses, which, at the end of the day, is what we’re all trying to do.

Kevin Sturmer 0:33
This is Leading the Charge, where we talk innovation and insights in the industry of sustainable energy. Leading the Charge is brought to you by POWR2, a global provider of energy storage solutions. Let’s simplify sustainability. And now from the POWR2 studio and broadcasting everywhere from leadingthecharge.io, here are your hosts, Tim Doling and Kevin Sturmer,

Welcome to Leading the Charge where we talk battery, energy storage, insights, innovation and the industry of sustainable energy. My name is Kevin, and I work in the marketing department of a company called POWR2, and with us, as always, is the incredible Tim Doling. He’s the vice president of innovation and a co founder here at POWR2. How are you doing? Tim, doing

Tim Doling 1:18
Well, Kevin, thanks for having me, and this is really exciting to be doing this live from Las Vegas, so that’s a first for us, and also to have some in Person guests. So this is going to be a good one.

Kevin Sturmer 1:28
Live and in person, and it’s wonderful. And we are joined by an expert. It’s perfect for ARA, actually, someone who has been in the rental industry for a while, also is the host of the Rental Journal Podcast and he’s been doing that for about 18 months, but really has hands on experience in the rental industry. His name is Michael Larson, welcome.

Michael Larsen 1:47
Kevin – a great introduction. As always, like I mentioned on The Rental Journal, what a voice you have. I need to take you on a few rounds of speed dating as a personal hype man, I think. But firstly, it’s amazing to be here in Las Vegas. It’s great to be back here stateside, being my third ARA show, and the US uncomfortably, feels like home. I love the country, your passion, enthusiasm, your your personalities are absolutely infectious, and even getting a sneak peek at the show floor this morning, walking around the outdoor exhibit that they’re hosting at the ARA and the POWR2 stand was looking unreal. I had a bit of a sneak peek through through the door, but feeling very fortunate to be here with The Rental Journal podcast again this year, having Tim on this morning for a featured episode discussing all things POWR2 and representing the Australian High and rental Association and our family rental business back home in Australia. But I’ve absolutely loved tuning into the Leading the Charge podcast over the last 12 months, and you do such an amazing job bringing forward great insights, discussions and perspectives for all of us as an industry on you know this changing dynamic of sustainable energy?

Kevin Sturmer 2:53
Wow. Well, thank you. And I think as Tim is blushing, I’m blushing as well. That’s a very kind of you to say, and a perfect fit here for ARA. Some people know there you’ve gotten questions in the past that you host the rental journal podcast. That is your job. Actually, your main job is something else that you spend time, as we sort of already alluded to, working in the rental industry. Can you talk a little bit about that at Larsen hire? What do you do?

Michael Larsen 3:20
I do. I my my main job is definitely not The Rental Journal. It’s more of a passion project for myself and work with Mark Simonson, who I’ve got a great partnership with. But yes, I do work for my family’s rental business back home in Australia. And I first must declare and provide a disclaimer that I by no means an expert on the world of sustainability, but I’m extremely fortunate to have had the opportunity to sit down and discuss these topics with global experts like yourselves, much smarter than I am on this exciting, developing and the interesting nuances of this space, on the rental journal and time across the nation with the Australian higher Association and, yeah, supporting our clients In Australia with their journey and transition towards sustainable energy, but the word sustainability is such a hot topic of discussion and considered a real buzz word at the moment, but it’s so important that we’re having this conversation because that not only the negative impacts of if we don’t make this transition, but also the requirements and the actions we must take as an industry to successfully make the transition towards sustainable energy.

Kevin Sturmer 4:22
First of all, I have to debunk you’re not an expert, because when you sit down for again, 18 months worth worth of episodes, you learn a lot and then the little time that I’ve known you, you are an absolute sponge when it comes to information and understanding of the world, and specifically the hire rental in Australia the remote applications. Tim, what’s the value having a battery, energy storage in a remote application?

Tim Doling 4:49
So remote applications, by definition, is harder to get there for fuel, servicing, maintenance, those type of things. So not only is it more expensive to deliver fuel there, but it’s also creating. More carbon emissions to get the truck out there to deliver fuel. So you’ve got that aspect of embodied carbons, as well as the actual fuel delivery costs service technicians getting out there is takes longer and it’s more time consuming, and again, more carbon emissions. So remote applications, yeah, a very good application for battery. So if you can cut down the generator run time, you’re going to lengthen out those service intervals and lengthen out those refueling visits.

Kevin Sturmer 5:24
And Australia seems to be a perfect location for remote.

Michael Larsen 5:30
Yeah, I guess, starting with a bit of a background, being from Central Queensland in Australia, our region is really considered in what’s called the world’s quarry and a hub for coal and traditional grid scale power generation. You know, coal plants and the coal mining industries are a major locational focus and huge driver for local employment, and brings in around $120 billion into the state’s economy. You know, for example, one of our major clients, who’s the largest power provider in Queensland, makes up about 40% of the state’s power in the range of 19,000 gigawatt hours, and which is a combination of their primary traditional fleet. But although, on the flip side, we’re seeing them diversify and with sustainable future assets to align with environmental regulations, legislation and to satisfy our state’s SARA assessments. So I guess it’d be, it’d be good to, yeah, start with the Australian energy landscape background and Australian domestic rental applications for those listening in. But you know, for example, there’s gonna be $4.6 billion spent on renewable projects in regional Queensland alone before 2026 but I think, like you mentioned, with this domestic side and the logistical hurdles. We’re actively exploring and looking for these applications regarding best implementation, like the example that we were speaking about before we started, having recently worked on a case study with the Queensland Government on a remote hospital application, being a relatively small power requirement with maximum loads only around that 28 amps, but presented extreme load fluctuations, you know, with the minimum powder only at about three amps to run the 24/7 security lights and the security systems on the site. So in this situations, and the extreme fluctuations presented are over time, our traditional diesel unit would simply glaze and looking to hybridize, and this application makes complete sense, not only for the flexibility of the batteries at handling these alternative loads, but also for the Gen set downsizing. Optimizing our Gen set loading and the secondary win of the 24 hour emissions is just an added benefit, but the real magic for us in this situation is the logistical side, which I was talking about to Tim, you know, the site’s approximately 120 miles from our location, so the reduction of this constant refueling, servicing, minimizing our labor costs, lowering the operational costs, and streamlining our processes, allows us to focus on just getting more rentals as a rental business. So from the Australian market and domestic landscape, it’s not just the sustainability side that makes this technology useful. It’s considering the compounding costs of long term rental applications and looking to leverage these products as we as we mentioned, with the remoteness and the logistical hurdles and operational nightmare that we experience with distributed sites across the country, within Australia.

Tim Doling 8:24
That’s such a good point, because you bring up something that isn’t often spoken about, which is the efficiency and use of your manpower, your staff. So if the site is 120 miles away from you, that’s a two and a half three hour drive for a technician each way you’re tying up that technician for a whole day to go and do, whether it be an oil change or a refueling stop, something like that. So by implementing the battery energy storage system, you’re pushing those servicing tools out, you can use that technician for other higher value tasks in the meantime that he’s not being tied up on that task. So instead of him sitting doing windshield time, he’s doing other stuff.

Michael Larsen 8:56
Yeah, look, we see field techs and service techs driving 1000s of kilometers for interim services, refueling and avoidable breakdowns on an emerge, an emergency stop could be hit. And like you’re saying, that windshield time is just absolutely exponential for rental companies. And even looking at it from a qualified performance perspective, even in 2025 you know, clients do simply still want dependability from their rental equipment. So I think, and I don’t think that’s specific to Australia either. I think that’s a globally, globally important. So I think the more simplistic our products can be, removing wear points reducing the, you know, constant annual servicing in these parts that we’re having to replace, making it easier for field techs is always a net win for rental companies.

Kevin Sturmer 9:39
And I think the savings too. I mean, that’s the one thing that struck me as we talked, and this is what we’re seeing across the board. We mentioned it on the podcast as well. It’s sustainability is nice, but it’s a secondary benefit. The primary benefit is the optimization of the process. You’re also saving a lot of fuel. We had an example where. Or somebody was going out and refueling every 12 days before implementing a battery, energy storage system. Now they’re actually only refueling every 60 days, and that suddenly becomes a time save, a fuel save, and again, as you said, windshield time. We talk a little bit about the grid. When, when we when we look at Australia, what’s the state of the grid? How can what’s the impact that BESS is having on the grid, as both in Australia and, you think, and also globally.

Michael Larsen 10:29
Yeah, I’d say our state, we have a fantastic climate, quite great wind resources and a large amount of real estate. But so I guess by nature, there’s a high emphasis on solar at the moment, and looking to leverage our close to, I think, 300 days of annual sunshine we have in Queensland. And just to put into perspective something we were discussing before, Kevin, there’s close to five and a half gigawatts of solar on domestic roofs alone, coming from a tiny state population of only five and a half million people, which is, you know, two thirds the size of New York City’s population over a state bigger than Texas. So I think, and there’s various multi 100 megawatt solar projects that haven’t been approved by the Queensland Government, and they’re all exceeding two $50 million for construction and requiring peak workforce in the hundreds of personnel to build so the natural resources, the infrastructure, the investments there. But our biggest hurdle, and the element that we’re facing in a lacking area, is currently not having the infrastructure to store this large amount of energy. We’re experiencing what they call energy spill in Australia. It’s like having a full glass of water and continually to pour water on top of it. It’s just not very efficient. So after so many chats with some of these key individuals and industry professionals, the magic for Australia to take us from good to great is increasing our firming technology and the storage technology in Australia, much like the power two product rolled out a gigawatt or grid scale, allowing us to cope with these periods of when the wind isn’t blowing and the sun isn’t shining, I guess you would say. But these projects are having a major effect in increasing the demand of construction equipment to support the build, and by nature, having a huge collective growth for the rental industry. And all of these projects are also projected to require sustainable products for the construction as a mandate with with the government. So our domestic transition presents such a complex engineering problem, and there’s definitely no on off switch from where we are today to 100% energy that’s sustainable and sustainably generated and stored. So it’s going to take time. It takes a lot of education in chats like we’re having today. And humans, by nature, hate change. And modern day humans hate change with an increased cost even more. So I think it presents a exciting opportunity for technically orientated and expert rental companies to leverage assistance support the service of these changing customer requirements. And from my perspective, can only be a net win for the rental community within the circular economy. So it’s something that we’re actively investigating as a business to support these future rental hurdles and the hurdles of our domestic transition, and these initiatives and projects that we’ve just mentioned as well.

Tim Doling 10:29
That sounds like a lot of solar. Is that specific to your state? You said Queensland, or is that Australia?

Michael Larsen 13:22
Queensland alone.

Tim Doling 13:25
Really? That’s fantastic. And so that energy spill and additional energy is that, is that utilized elsewhere in the in the country, or it’s wasted essentially as of now.

Michael Larsen 13:36
Yeah, it’s like this spill that we’re facing, you know, and that’s one of the massive growth markets for Australia. From like we’re saying this, this grid perspective, one of our major clients has just developed and testing and piloting some new ESI flow batteries, which is said to be commercially rolled out at gigawatt scale by 2027 and recently unveiled a new faith facility project with which they’ve coined in in central Queensland, which will include, I think, a 10 megawatt solar array and lithium ion firming, but most importantly, act as an R & D facility for commercially testing emergent, emerging sustainability technologies for Queensland. By Queenslanders. This energy literacy and growing the education globally is our biggest hurdle, because we’ve really been, again, focused on on one direction, with traditional grid scale power generation, so shifting that education and, you know, really prioritizing the involvement of the new people, not only coming into the rental industry, but coming into our world as engineers, as electricians, as, you know, future citizens. If this is the way we’ve got to go, then we’ve got to kind of change our mindset now approach to it so. But I think the biggest thing that we need to highlight is not only the savings of CO2 and making it environmentally responsible and being good citizens, this really does provide performance. You. So many applications. And I think it’s worth mentioning that Australia is very different to Europe, and the US being this large, long spread network, getting power from one side to the other is quite the exercise, and it’s quite the challenge. And you know, just looking at our state of Queensland being over double the land mass of Texas, our demand centers are distributed by 1000s of kilometers, whereas in Europe, demand centers are closely interconnected, and you can send power from France all the way to Germany quite quite easily. And I’m sure that’s something you’ve seen from growing up in the UK Tim. And we don’t have access to this level of cheap natural gas, and comparatively to the US, which I know is really big, and don’t have access to hydrogen fuel either. So for us as a rental company, hybrid systems or battery systems is probably the best approach to suit the majority of the scopes we encounter, and allows us to continue to utilize our existing fleets as well as a product for the future, like a POWR2.

Tim Doling 16:00
Yeah, just the scales and differences involved in the countries just make it so different to other regions. And we’ve definitely seen it coming from, from the United Kingdom and Europe, where everything’s so close, it just puts a whole different perspective on it and speaks to the efficiency factor we were talking about earlier.

Kevin Sturmer 16:17
Yeah, yeah. And looking more to a global perspective. I know you’ve talked with people in the rental industry around the world. What are some of the things that you’ve you’ve learned in terms of how things are expanding?

Michael Larsen 16:33
Yeah, I’d say there’s such a global push for the sustainable energy transition, not uniquely to being here today in the US or Australia. It really is a collective approach that I think a lot of nations are moving towards. You know, for example, this morning, I recently read an article about the Adani Solar Park, which I’m not sure if you’ve heard of. It’s over 30 gigawatts of solar, and the site covers 540 square kilometers, which is five times the size of city of Paris, which was just absolutely the pictures make no sense. To be honest, it was unreal for me to see. And I think we could confidently say that Europe is still the leader, I would say, and simply just from the sheer amount of time that they’ve had in the seat for developments over other nations, and I think they’ve definitely had a big start, which we can only improve on, take inspiration from and learn from. And I think you’d know that history much better than I Tim. I think the first best system come out of a European company called Firefly, back in the 2010s.

Tim Doling 17:33
Correct. Yeah, yeah. I know the founder of that company, who headed that up, there’s some debate between him and another competitor who was first, but they’ve they were in it together, pretty much seeing it in festivals and events to begin with, and then wondering how that could transfer over to the construction industry. So yeah, 2009 or 2010 something like that. So we’ll let them fight over who was exactly. Both of them are out of it now. But yeah,

Michael Larsen 17:59
No, I think you know, and it’s something that I don’t often hear being discussed, and I think it’s something worth highlighting, is the huge percentage increases in energy consumption when we’re looking at the Indian and Asian regions, especially from this global perspective, even though us as Western countries like the US, are down 30 points in energy consumption. And to meet your USA, I think it’s called the EPA, and Europe’s down over 200 points with their Paris Agreement and carbon embodied programs, but with a 40% population growth in India, this energy consumption really outweighs the reductions that we’re making by in Western nations. So it’s not only that they’re using more power, they’re simply accessing and moving towards and reaching our level of consumption. You know, for example, the energy consumption per capita in Australia is around 10,000 kilowatt hours, whereas in India, it’s only 1000 so I think with an exponential increase in population spike. I think we really do have to consider this as a global problem that we need to collectively solve. And I’m sure it’s something we can pop up on the screen for the audience at home, Kevin, is Maslow’s Hierarchy of Needs, which we discussed. It’s really a privilege that we get the opportunity to have this discussion today, because on the other side of the planet, there’s a family and millions of people living in situations where they don’t have any form of power, let alone from a sustainable source. So these people understandably have no concern or consideration of sustainable energy. They just want power. They don’t want increased barriers, and they’re not concerned about what might come along with an energy transition. So conversations like we’re having today, I think we need to consider, like we’ve mentioned many times on this podcast, is this energy literacy and collective energy literacy that we can move towards. And the questions would be, how can we lead, by example, as innovating countries, as an innovating community within the rental industry, to continue to support. Support and drive focus and emphasize the benefits that we supply as a circular economy as well.

Kevin Sturmer 20:06
I will say that does play to what we were talking about with the question at the end of the episode, it has to do with practicality. Let’s go with one example where you’ve seen the practical solution win out from a financial standpoint, from an operational standpoint.

Tim Doling 20:25
More and more we’re starting to see sustainability. We talked about second, over and above with with practicality and a solution that makes sense coming first, and not that sustainability ever is going to be unimportant, but it’s just people are starting to realize how these other solutions can make more sense. So I just had a call before the weekend from a client in New York City who’s running some high rise blocks. They’re residential blocks, and there’s no grid power yet, so he’s having to run it off some large generators. And because there’s multiple apartments within the high rise block, the power needs just fluctuate wildly depending on who’s home, who’s running lights, who’s running heat that type of thing. So he’s got these, these 500 KW generators running in in parallel to heat this, to power this whole building, but the because of the low loading, they’re shutting down. He said he’s had his technician out there all week trying to figure out these power problems. He said, If only I could have a battery in there so the switches generators off and just come on to recharge the battery. That’s where we go from talking about sustainability, talk about a solution that’s going to actually fit the needs of the project much more exactly, provide reliable power and quality power without the need to have that technician on site. And he’s not a he’s a he’s a very good company in a decent size but he’s not a huge company. So he can’t afford to have his technician tied up at one place all day long. So this is a solution that really makes sense. And I hear what Michael’s been saying about the needs in these other countries. I’ve been to those countries where people are literally tapping off the high rise, the high poles with the electricity to try and get electricity to their encampment, those types of things. So we do really have to be cognizant of the power needs in these other places and realize that these solutions will have to make sense. So I don’t be glad of what Mike would say on that as well.

Michael Larsen 22:10
Yeah, I’d say from like, what Tim really highlighted this morning on on The Rental Journal, is now, if the tech available in 2025 we’re really starting to see genuine performance at the end of the day, and unbelievable track record and proven case studies, especially what you guys have achieved at POWR2 and a lot of other manufacturers are achieving globally. So I think from the perspective of what’s next and what’s on the horizon past 2025 I think we’ll see, and we’ll love to see a continued movement and continued progression from just satisfying not only sustainability, but also generating profitable business models within rental businesses, which, at the end of the day, is what we’re all trying to do in in rental businesses and within the rental industry. And I think just looking at it from such a low hanging fruit perspective, in a way, just it’s worthwhile mentioning the economics of Australia’s fuel just that metric alone. You know, Australia’s fuel prices are exponential, especially comparatively to the US. I see us, people complaining on how expensive fuel is per gallon. You need to come down to Australia and fill up a fill up a tanker tank of fuel. That’s for sure. The operational costs we’re experiencing and the flow and effect to the rental industry is absolutely insane in our Australian market, just from a fuel perspective, let alone adding in these other metrics, like our location issues with a distributed distributed places all around the country. So not only looking at this from a sustainability and a reduction of CO two perspective, like Tim said, we’re actually starting to see really good profits and really profitable rental businesses for the future, which is amazing.

Kevin Sturmer 23:49
Tim, what’s the expression you always say about that the profit?

Tim Doling 23:54
There’s a few of them. Kevin, which one do you want?

Kevin Sturmer 23:56
Just go with the one that pops to mind.

Tim Doling 23:59
Well, we always talk about simplifying, sustainability. We talk about things being easy, not onerous. What else is there?

Kevin Sturmer 24:05
No, that’s it. That’s absolutely it. And if you have a question, you can email us at [email protected] that’s P, O, W, R, the number two.com. Our legal team wants me to say that the views and opinions expressed by the hosts and guests here on Leading the Charge are entirely their own and do not necessarily represent the opinions or views of POWR2, their partners, or affiliates. And you can learn more. We’ll have links to everything, links to Michael’s, LinkedIn profile, The Rental Journal Podcast, everything there you can go check out leadingthecharge.io. Michael, a huge thank you for being on the podcast with us today and taking the time out at this week at the American rental Association Conference.

Michael Larsen 24:51
No thank you very much. I’m looking forward to seeing more of Las Vegas, the POWR2 stand. Hopefully you can give me one of those VR headsets and I can have a bit of a walk around and get lost on a virtual job site. So no awesome, awesome job guys. I really congratulate you on starting this podcast, driving such amazing education for all of us in the rental industry, how we can move towards a sustainable future. And I look forward to catching up with you guys soon in Australia.

Tim Doling 25:16
Thank you very much.

Kevin Sturmer 25:17
Yep, thank you so much. And we want to thank you for spending even just a little bit of your time with us. We know your time is valuable, and we really do appreciate it. So let’s keep simplifying sustainability and Leading the Charge toward a world powered by sustainable energy. See you next time.