Redefining Energy

Founded in 1848, Lazard is one of the world’s most prestigious investment banks. But in energy, its influence goes well beyond Wall Street. For twenty years, Lazard’s Levelized Cost of Energy (LCOE) report has shaped how investors think about the economics of solar, wind, gas, coal and nuclear. It has helped change minds—and channel vast amounts of capital into the energy transition.  
The report has also attracted criticism. Its critics argue that LCOE ignores some of the hardest questions facing modern power systems: intermittency, grid integration, balancing and backup. Yet despite those shortcomings, for anyone investing in energy, the Lazard report remains the reference. The “source.”  
So what does the latest edition tell us about where energy is heading? Laurent and Gerard have the privilege of sitting down with George Bilicic, Global Head of Power, Energy & Infrastructure at Lazard. George advises some of the world’s largest companies and governments on strategy and finance and has spent decades at the heart of the energy and financial industries, working alongside legendary figures such as Felix Rohatyn and Bruce Wasserstein.  
We talk about America’s extraordinary surge in electricity demand—and what it means for the power system. We dig into the economics of solar, wind, gas and nuclear. We discuss geothermal. And we ask a deceptively simple question: what is actually the cheapest way to produce reliable electricity? 

The answer is more complicated than the headlines suggest. In the US, renewables are among the cheapest sources of new power. But geography matters. So do grids, intermittency and backup. Gas can still be remarkably competitive when those costs are taken into account.  
And there is a crucial catch: what works economically in gas-rich America does not necessarily work in countries that have to import their gas.  
Then there is nuclear. Nuclear is coming back—but don't expect a renaissance overnight. We discuss why its revival is likely to be slow, expensive and heavily dependent on governments rather than markets.  
A fascinating conversation with one of the true titans of the energy and finance industry.

Link to Lazard LCOE report
https://www.lazard.com/news-announcements/lazard-releases-2026-levelized-cost-of-energyplus-report-pr/

Last year, the nuclear industry experienced something close to a gold rush. SMRs — Small Modular Reactors — became the hottest story in energy. Private capital poured in, valuations exploded, and the industry produced an impressive collection of truly bombastic promises. The backdrop is undeniably powerful: electrification is accelerating, geopolitics are reshaping energy markets, and the world needs reliable, 24/7 clean power. Nuclear has rarely enjoyed such formidable tailwinds.  

So, what could possibly go wrong?  
Gerard and Laurent bring in Andrei Utkin, Associate Director at S&P Global Energy, and one of the more independent observers of the nuclear industry, to separate the nuclear opportunity from the nuclear hype.  
Because there is a problem. The Western nuclear supply chain has not exactly covered itself in glory this century when it comes to delivering large reactors on time and on budget. Governments are nevertheless pushing ahead — rightly so. We are particularly interested to see how smaller designs such as GE Hitachi’s reactor in Ontario and Rolls-Royce’s SMR in the UK perform. These projects have something many start-ups do not: government backing, established industrial supply chains, and companies with decades of nuclear experience. Whatever the final cost — and, for reasons that remain remarkably consistent, that cost always seems to go up — these SMRs are likely to happen.  

But the really fascinating story is the private SMR market. Today, it counts roughly 50 developers, 130 designs, 20 publicly listed companies, and more than $10 billion of private and corporate capital. Yet only a much smaller number of technologies are genuinely approaching commercial deployment.  
Some have made it to the stock market: NuScale, Oklo, X-Energy, Nano Nuclear. Their share prices all peaked around twelve months ago. Since then? Down 50% to 80% from their highs. Perhaps the public markets are beginning to tire of an industry that has delivered an extraordinary number of promises — and comparatively few reactors. Meanwhile, the executives and early shareholders of some of these companies have managed to cash out hundreds of millions of dollars.  

Then comes the small detail of economics. With nuclear CAPEX estimates somewhere around $15–20/W — your guess is probably as good as ours — and brutally long lead times, nuclear has to compete with hydro at around $10/W, gas at roughly $4/W (up from about $1/W), wind at $2–5/W… …and solar plus batteries at around $0.40/W. That is an uncomfortable competitive landscape.  

And we haven't even discussed the fuel. Russia still controls roughly 40% of the conventional nuclear fuel supply chain — and effectively 100% of the HALEU capacity required by some advanced SMR designs. So much for energy independence.  

Laurent then tackles another increasingly abused acronym in the nuclear world: FOAK — First Of A Kind. What does it really mean? And, more importantly, how many times can a technology be “first of a kind” before investors start asking when the second one is coming?  

All of this — and much more — in our yearly deep dive into nuclear: the technology, the economics, the geopolitics, the promises, and the increasingly uncomfortable gap between them.  

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Link to S&P report on nuclear
https://www.spglobal.com/energy/en/commodity/electric-power/nuclear  

Michael Barnard articles on SMRs
https://www.linkedin.com/pulse/scaling-examples-pt-1-small-modular-nuclear-reactors-smnrs-martin  
https://nbmediacoop.org/2022/07/31/smnrs-riddled-with-high-costs-among-other-unresolved-problems/ 
And of course World Nuclear Industry Status Report 2026 (WNISR2026) 
https://www.worldnuclearreport.org/World-Nuclear-Industry-Status-Report-2026 
Finally, the full text of 1953 Memo By Admiral Hyman Rickover   https://whatisnuclear.com/rickover.html

The current datacenter buildout is the biggest GDP bet in America since the railroads 150 years ago. We have never seen a frenzy quite like this. The system is running on overdrive—and the cracks are starting to show.  

While Anthropic and OpenAI announce dizzying financing numbers, measured in the trillions, the markets are beginning to cough: force majeure—effectively a default—at Oracle’s Jupiter datacenter; SB Energy abandoning its IPO; private credit funds restricting redemptions; and certain neoclouds’ bonds being priced as riskier than those of Zambia or Angola.
And still, the buildout goes on.  

Yes, half of the announced datacenters may never be built. Yes, local politics are turning increasingly toxic, with moratoriums spreading. And yet the buildout continues—and could move even faster if only the supply chain could keep up.  

So, who should we believe: the bulls or the bears? Gerard and Laurent bring on one of the leading specialists in datacenter development, Eugene McGrane, Executive Managing Director at Cushman & Wakefield, one of the world’s largest real estate services firms. Cushman & Wakefield provides specialized real estate, financial, and strategic advisory services to the digital infrastructure and datacenter sector. Eugene’s team works with investors, developers, and technology occupiers on site selection, power procurement, land acquisition, lease negotiations, and project construction.

We have a freewheeling conversation about what hyperscalers really want, the insatiable demand for compute, credit risks, political backlash, and how this industry seems to reinvent itself every few months.   Who are the winners? Who is most exposed? And where is this extraordinary journey ultimately heading?
So, is the glass half full or half empty? It depends on your vantage point.  

What seems clear is that demand for compute is not slowing down. And the sheer scale of the datacenter buildout is forcing the energy system to mobilize capital, infrastructure, and technology at a pace that could accelerate its modernization.  

The AI boom may be chaotic, financially extreme, and politically contentious. But the buildout is still going.  

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The global market for Virtual Power Plants is assessed around 100GW (+/- 20GW). It is a 7bnUSD expected to grow at a CAGR above 20% in the next 5 years to reach 40bnUSD within a decade.   VPP are a digitally coordinated flexible network of distributed resources: cheaper than central stations. They manage behind the meter assets like Solar, batteries, HVAC, EV…  

VPP is a term invented 30 years ago by US economist and finance scholar Dr Shimon Awerbuch, who died 20 years ago in a light plane crash over the Alps. Only aged 51, he leaves a great legacy. His foundational work in 1996 was called “The Virtual Utility” where he demonstrated that Electricity generation must be treated like a financial portfolio. He proved that Renewables (even if they were very expensive at the time) were a powerful hedge against fossil fuel volatility.  

In our series about how digital is transforming the how we track, trade, and optimise energy, Gerard and Laurent have invited Marc Rühs, CEO Next Kraftwerke, the world largest VPP with 15GW Capacity. Connecting more than 14,000 decentralised electricity producers, consumers, and storage facilities, the company contributes to grid stability and optimizes electricity production and consumption based on price signals. It trades its electricity on various European exchanges via its own 24/7 electricity trading platform. Next Kraftwerke has been part of the Shell Group since 2021.

We have a deep conversation about how VPP work, their impact on flexibility, and the fact that they used to be ignored or discarded by incumbents. But that is changing with the arrival of AI providing better systems and increased demand.  

Along the way, we pop some balloons, such as V2G or Heating management, which work great in theory but are non-significant from a volume point of view. Maybe they will in the next decade.   As Shell is reducing its footprint in Clean Energy transition assets, it is reinforcing its position in the VPP market, as Next Kraftwerke is fully integrated into Shell trading organisation.  

Marc demonstrates that the future of energy lies in intelligently connecting renewable generation, storage, demand-side flexibility, and trading capabilities to create a more resilient and sustainable energy system.

Joseph J. Romm (1960–2026) was an MIT-trained physicist who became one of the most prominent voices in the U.S. climate movement after serving as Acting Assistant Secretary for Energy Efficiency and Renewable Energy at the U.S. Department of Energy in the 1990s.  

He founded the Climate Progress blog, authored ten books—including The Hype About Hydrogen and Hell and High Water—and was named a Time “Hero of the Environment” and one of Rolling Stone’s “100 People Who Are Changing America” in 2009.  

Later, as a Senior Fellow at the University of Pennsylvania’s Penn Center for Science, Sustainability, and the Media, Romm continued to challenge what he regarded as dead-end technologies and costly distractions, including hydrogen, carbon offsets, and carbon capture.   Romm died unexpectedly at the age of 66 on September 14, 2026, in Washington, D.C.  

Michael Barnard and Joe shared a long history of friendship and collaboration, strengthened by a memorable conversation 18 months ago following the release of the second edition of Joe’s seminal book, The Hype About Hydrogen.  

That conversation between Joe and Michael was a fascinating and uniquely candid dialogue about the real solutions to climate change—and about technologies they believed risked diverting attention and investment from more effective pathways, including hydrogen, carbon capture and storage (CCS), direct air carbon capture (DAC), and some proposed approaches to green steel.

Joe had an extraordinary influence on the climate and energy-transition debate over the past three decades. His rigorous analysis, willingness to challenge conventional wisdom, and ability to communicate complex energy issues shaped the way many of us think about the transition to a clean-energy economy.  

He will be deeply missed. He will not be forgotten.