 It's Wednesday afternoon and we know what time that is, Hawaii, the state of clean energy time. I'm your host, Mitch Yuan, and our sponsor is the Hawaii Energy Policy Forum and the Hawaii Natural Energy Institute. So I'm really pleased to have, all the way from Canada, Carlos Nunes. He's the president and co-founder of Aurora Industrial Machines. And the topic of our conversation today is doing more with less. So we're gonna talk all about the Aurora Electric Motor, which is really, really breakthrough technology. So Carlos, welcome to the show and tell us all about electric motors at the top level first. Why are they so important? Well, I think really the electric motors are sort of the unsung hero of industry and commercial space. They consume a huge amount of energy and I really think that a lot of people, when they look at a map of the planet from space and they see the entire globe lit up at night, their immediate first thought is that lighting probably would represent the largest consumer of energy on the planet. And it does actually represent a large percentage, but it's actually much smaller than most people would actually realize. It's actually only 19%. And in fact, actually 49% of the world's electric power that's currently being generated once it's actually transformed and distributed goes into electric motors. So they represent a massive load on the grid and there really hasn't been a significant improvement in technology with electric motors and there's a real need, especially in today's world to look at our energy production, but also at the same time look at our energy consumption because energy is a two-sided coin. If we're only focusing on production, which isn't a bad thing, it's a good thing to look for renewable sources. We also really need to also look at consumption and see what we can do with the electrical load and the grid and how we can help balance the grid with efficient use of energy. I think you have a couple of slides that kind of illustrate the amount of energy that's used by various market segments. We have that first second slide, slide two up. So what's this telling us, Carlos? So if we took a step back in time into 2008, at that time, the International Energy Agency committed a study on electric motor driven systems globally and this really shows the aggregate of what the energy consumption was and we were in the order of 20,000 terawatt hours of energy being generated. So that's 20 petawatts of energy. So every single electron on the planet, that's what was being generated in 2008. And if you look at the bottom, you can actually see the distribution on where the energy was sourced. And you can see in that time period, about 85% of the world's power was generated from fossil fuels. So we are making strides in the future and currently and then into the future to switch from fossil fuels to renewables, which is great. But the thing that needs to be understood is that the demand curve for energy is so strong that we really need to double down on our renewables and that needs to happen today. We need to really, if we're doing a certain amount of solar, we need to really double that effort to really meet up with the demand. Cause if we go to the next slide, you can see what the projected low is going to increase to by 2035. So we remember that it was about 19 petawatts of energy. By 2035, it's estimated that it'll be north of 35 petawatts. So that's almost a doubling of energy demand on the grid. So we really need to focus on production, but consumption needs to be a new focus and we need to learn where the load is going and really try to make as many improvements as possible to the load. So let's look at the next slide cause I think that tells us where it goes. There you go. Yeah, so here is a real good distribution of where the energy is actually going. So again, to my first comment, 19% goes into lighting. Approximately 19% goes into heating. And then with the data centers that are around the world, there's an example there of a Google data center. About 10% of the world's energy is actually starting to go into data centers and that's actually growing as well. So even with all of those, electric motors exceed all of those. So there's a massive opportunity. It's literally the elephant in the room that no one realizes is there that we need to focus on because it's a massive draw. Yeah, when you told me that when I first met, I was just like totally astounded. Like whoever heard of industrial motors being like what? 46 or more percent of all the energy in the world is really boring electrical motors? Yes, that's true. And it's really in, and it's not surprising because that's not what your mind initially goes to but that actually is almost 50%, almost half of the world's power is just going into electric motors. And it's really concerning because the size of the grid, the grid is the largest machine on the planet and its tentacles stretch out to the edge of the map. It's the biggest machine we've ever invented and yet the way we distribute power and the way we use the power can improve exponentially if we deploy the right technologies in the right places. So let's look at the next slide which kind of illustrates that. Yeah, so we break it down into different sizes of motors but you can see there that motors represent a large slice of the pie in terms of the way that energy is distributed and that there are different sizes of motors around the world. There are about 2.3 billion electric motors on the planet. Let's look at the next slide because that shows it. Yeah, there we go. Okay, so 2.3 billion electric motors on the planet, 2 billion of them are actually below one horsepower and about 300 million roughly are above one horsepower but the lion's share of the energy is in the industrial motors above one horsepower. From one horsepower all the way up to 300 horsepower. That's where the lion's share of the energy is consumed in energy. It's about 64% of industrial consumption is from motors itself. But if you look at that grid a little bit in more detail you can see that when you look at that 19 Padawatts you can see that there's quite a bit lost actually in transformation. So even in the grid we lose quite a bit of energy. So from that 19 Padawatts, only 15 is actually usable. And then you can actually see that the electric motors makes up the lion's share of that usable that's actually left. So in electric motors most of that energy goes into pumps, compressors, fans, you name it and they are ubiquitous and they are everywhere and they give them a lot of energy. So when I walk around now having met you and been fascinated by the number of motors all I see everywhere I look now are electric motors. It's funny when you change the way you look at things the things you look at change. Let's look at the next slide. So again, yes, the breakdown by sector. So industry represents about 64% and then commercial and residential around the remaining portions of the pie. But that's why we focused on industry in the beginning and we're going to continue to focus on industry to really help that sector. But we're also open to looking at commercial opportunities as well. Yeah, so your next slide talks a little bit about what do people really care about? So what do they care about? So when we looked at electric motors we really thought, you know, let's focus on durability because when you look at an electric motor most people think, well, the most important thing is the efficiency. I want the motor to be as efficient as possible or actually even prior to that the procurement we want the most affordable motor we can purchase but the most affordable motor you purchase is not necessarily the most affordable to operate. So a really good example I like to give is that a 200 horsepower industrial motor today costs $10,000 to purchase. But in the course of 20 years of operation that motor will consume $1.4 million in electrical power. And you think that's a big number, which it is. But in those same 20 years the breakdown cycles that occur and this is from an ABB study that same motor in breakdown costs would be $1.6 million. So suddenly a $10,000 purchase which seems like a lot of money at first becomes a $3 million liability. So we looked at those and really decided let's focus on the reliability piece first. And a really close second to that is the efficiency. Let's make sure this machine is as efficient as possible. So we really designed an electric motor that it has many similarities to an aircraft where we built in all redundancies to make the machine as fault tolerant as possible so it can withstand a failure and continue to operate. And that's really important in industry because if the motor is in a very specific part of a plant and you have to shut that part of the plant down that's significant cost and revenue to that particular operator. So we wanted to make sure that operators could plan their replacements and still have the operability of the machine. But then if there is a failure down the road that they could swap it up if necessary and they can make that a part of their maintenance program. So you have an interesting background Carlos because you come out of the aerospace business. So tell us a little bit about, you know how you developed this thinking about durability and backup systems, the backup systems. Yeah, I was actually 29 years in the aviation industry. My claim to fame is that I rewired Bill Gates' helicopter in 1994 from scratch. It was a belt-tool, six million ranger. Yeah, he wanted every system you can think of. Bill wanted a helicopter look like a porcupine when it was done. It had more antenna sticking out of it than you can imagine. But yeah, I've seen every fault that you can imagine on an aircraft and I've seen how systems are designed. Boeing 787s, Boeing 777s, airbuses as well. Even the Embraer 190, I've seen a lot of different manufacturers in the way that they approach design and the way that they approach system alt-tolerance. And everybody comes at it from different sort of way of thinking, but at the end of the day it's really about you have to allow for gradual soft failures that allow for the system to continue to operate. Just like if you're flying on an aircraft, on an Airbus A320, there are seven layers of cascading faults that have to occur prior to being able for the pilot to be what's called direct law. So you want to build a system, if you're gonna build a system that's a really great model to follow so that you know that when you design something it can have what's called planned endurance rather than planned obsolescence because we've done planned obsolescence and it's time to now start building things that last. And if we're gonna get out of the problems that we're having today with products being built to end up in a landfill, we really need to start thinking in a systems design perspective and building systems that can endure. Well, that's part of your corporate philosophy, is it not? Absolutely. You design the whole product life of your motor. Absolutely, yeah. We really focused on what I like to call, well, it's a cradle to cradle process where we want to be able to use products as what are called technical nutrients in the technical nutrient cycle. So if you have a product that's being replaced, that particular product's technical nutrients, the aluminum, the steel, the copper can be completely recycled or what's called upcycled back into new material. Some of the bobbins in our machine are actually recycled ocean plastic. So we make sure. Yeah, that was fascinating. Yeah, so we take the waste product and we convert it into a product that's actually perfectly usable. We simply add some carbon fiber into the mix of that plastic and we make sure that our suppliers are aware that we use all the kinds of products that we want to incorporate in our design. Right, so roll the drums. Next slide. Out of all this philosophy in design comes. Introducing the matrix machine. And it's an adaptive electric machine capable of motoring torque and are generating power. So in the same machine, we have the capability of generating power and through a variable speed load or variable speed prime mover, but we can also of course provide motoring torque to pretty much any application. And we wanted to make a machine that was very versatile and adaptable, easily fitted into various applications. And we also wanted it to be able to accept any form of power either AC or DC. So let's go to the next slide and we can drill in a little bit more of the core feature. But one of the things that struck me is that this motor quote generator could also be used in wind turbines, which I have an personal interest in. Yes, and this is actually where it became very interesting because we first approached this from the motor component. And then we realized quickly that we could also generate power with the same architecture. And it's literally the flip of a switch. The matrix generator and the matrix motor are the identical machine. And it's as simple as either throwing a switch or changing a logic state from a zero to a one and it becomes a generator. So it has the capability of doing both. But why do you call it the matrix? The reason the matrix word came about was because we use what are called elements. So within the design core, we have, sorry, within the design core, we have active elements and they create a matrix. So this design could actually form a linear drive. So imagine if we had a series of coils and we have a series of rotor elements, they could actually be used on a linear train. But they create an array because we actually have three separate phases that are all working within an array. And the word matrix simply is a mathematical term for a grid. And in essence, that's what we've created is a mathematical grid of elements that all interpolate together and work in a tangential configuration or an axial configuration. So this machine has some very unique properties that don't exist in other machines. Okay, so without giving away all the secret sauce, I mean, you talked about how you actually achieve being able to use like up to up or more than 40% less energy. We're not talking about the efficiency of the motor. We're just talking about the fact that you don't even need to use that much power to start with, correct? Correct. So when we talk about the energy efficiency of the machine, we really make it simple. It's electrical power consumption versus another machine. The exact same load, the exact same speed, we can achieve much better electrical load and we have immense gains from in comparison to existing machines. Yes. Okay, so why don't you go through some of the highlights that we've got highlighted here in this particular slide. Let's look at this, the core feature slide. There you go. Next one, previous one, I think. Yeah, I'm just having a look at it now because it's really small on my screen. So yeah, a couple of them that I think would be really great to highlight is the versatility, the reliability. Those are really key features. Active kinetic recovery and magnetic recovery. We definitely employ a secret sauce within the design that enables that net efficiency. But the one piece that we haven't talked about is dual motion. That's one piece of the machine that is actually quite interesting. It's the world's first US patented motor that has dual motion capability. So not only will it move in this direction but it can translate for and after within the same machine. So what does that give you? So like, so what? Okay, so in a wind turbine, for example, you have the capability of having, normally you'll have a generator, a transmission and you'll have separate actuators on each one of the blades that control the pitch. So imagine being able to simplify a wind turbine from those five components down to one. So with the matrix generator, not only would you be able to translate the generational power through the prime mover but you can actually translate the rotor for and after to control the pitch of the blades. And because we do not require a specific speed to generate the 60 cycles, we control that electronically. Our active front end produces the 60 cycle output that's required. So the generator can simplify wind turbine design significantly but it also has applications in robotics. It has applications in some that we haven't even considered yet. But it's very unique in that sense that we have this new capability that didn't exist before. Okay, so let's look at the next slide. And so we'll just kind of review some of the problems that your machine solves. Yeah, so one of the key elements there is the restrictive torque and speed control. The standard AC induction motors receive a percentage of efficiency based on a specific speed. They have a torque curve and they're rated for that torque curve and they're rated for that specific speed. 1800 RPM is a standard industrial speed for motors and their efficiencies are tested in the lab at that particular speed. The benefit of the matrix is that we can maintain high efficiency throughout its operating range. So our torque curve is not as defined as a standard AC induction motor, it's much flatter. So as a good example is the Site-C dam. There were engineers that I talked to up there that were talking about how the motors on the conveyors would drop in load. The load would, the efficiency of the motor would drop from 90% down to 30% as soon as they were outside of their torque curve. The speed was outside of the torque curve and the load was outside of the torque curve. So the efficiency dropped significantly. So with the matrix that wouldn't occur, we would maintain high efficiency even if there was a change in torque and if there was a change in speed, it will maintain that independent of speed and independent of torque. We can control either at the same time. Okay. So let's look at the next slide because then we bring out the, you mentioned it earlier in our talk about the cost of ownership, which is astounding. So this is more of a breakdown I think of where those savings come from. Maybe we can talk to the slide. Yeah, absolutely. So to remind the audience, the cost to purchase the machine in this example was $10,000 to purchase the energy costs over 20 years, 1.4 million. The cost of not running the machine in terms of downtime cost is 1.6 million. So with the matrix and the, in its, you know, the onset is always to make the machine as efficient as possible, but more so as reliable as possible. So our downtime costs, we're projecting, we're gonna drop that down to zero because of the ability for the machine to continue to operate, even though it could sustain a failure but continue to operate. So there won't be any downtime costs. And then the energy efficiency that 40% that you talked about, when we calculate that and bring those two together, we estimate that over 20 years we can reduce the cost of ownership by 66%. Wow. Significant savings to the operator. Yeah, exactly. So let's talk about the business side or the product development side. Where are you in your product development? Is this all nice pictures or do you actually have some real hardware? We have some real hardware. We've built several machines. We're up to about a couple dozen now. We were actually, we've done some deployment tests. We've done some testing in the field. We're actually, we just won the BC FAST pilot program and we're working with partners in industry right now and actually developing machines for our industry partners to test the machines and verify the previous case studies. So we're actually doing much longer term case studies. The first test that we did was up at Carbon Engineering and we ran the machine there for off and on for about a month and we were able to get some good data from that. Now we're doing more of a longer term 90 day test and we're gonna recording the data and capturing that information for later tests. So what size of machine are we talking about right now? So these are 15 horsepower industrial machines. We targeted that as our first sort of foray into this market. We did a global market analysis and decided that that would be a good starting point because there's a huge number in that sort of size range. It's a good starting point in terms of size as well. But of course the matrix can go from 15 to 30 to 60 to 90 horsepower and even larger. We talked to people about the design of the machine could actually go from 10 kilowatts to a megawatts. There's really no restriction in terms of the architecture of the design. It can scale. So I have a question about that. So scaling up sometimes takes a lot of engineering a lot of time. It's not necessarily that simple, but maybe it is with yours. But can you like put two or three machines on the same shaft and get a higher torque out of it? Is that something that you can do? Or is that sound logical? Like if I wanted 30 or 40 horsepower, but you've got a 10 horsepower, 15 horsepower unit, can I gang two or three of them together and achieve a higher level of horsepower? I wouldn't recommend it. I think the best thing to do is to right size for the design. So if you have a specific load and you need 30 kilowatts let's say 30 horsepower, we can definitely design the machine to meet that particular load. And it's just a matter, in terms of the core design of the machine, all we're doing is just increasing the core size and the core diameter to meet that load. And then the power electronics have to be upgraded to obviously to handle that higher current draw. Okay, so you've had significant funding or in support from the Canadian government. You wanna talk a little bit about that? Yeah, we worked with the National Research Council early on and we were successful in getting some support from the NRC, which was fantastic. And we've continued to have that relationship with the NRC over many years. So why don't you talk, I'll just interrupt quickly because this is an American audience. So why don't you talk a little bit about what the NRC is? I mean, I know about them because I'm Canadian and they have a huge positive reputation but just talk a little bit about what they do. So the NRC is the Canadian National Research Council. They have several arms across the country and one of the key programs that they have is IRAP and it stands for Industrial Research Assistance Program. So they identify TRL level one or two technologies that need research and development funding to really bring the technology from its infancy up to and including pre-commercialization just as the machine is nearing its need to go into the field and have testing, then they guide the process to really assist small to medium enterprises to take their initial idea into an actual prototype and then you meet the milestones and you go through the program and there's a huge amount of learning that we've done over the years and I can't say enough good things about the NRC. There are fantastic support for Canadian companies. So I heard about you through the Canadian Navy. So talk about the Navy. The Navy's been great actually and we've had some great conversations and a lot of interest. So we've actually had members of the Navy at our laboratory and had them witness the machines firsthand and they have the RCN, the Royal Canadian Navy has basically said that they're very interested in testing our technology and being able to validate it. So we're working with them right now to try and demonstrate that this technology can be used in many different applications from propulsion all the way to water movement, you name it, there's a lot of applications that the Navy could use. So we've got about a minute or so left to go. So I want to talk a little bit about your business development. Like are you looking for funding and what's the deal? Or if somebody's looking at this show and they say, wow, like I did, this is great stuff and I want to be part of it. How can they do that? Is that something you're looking for or are you all set? We are in a good position. We're starting to get a lot of interest and it's great to start to see customers, potential customers coming to us and asking for orders and they're looking to test the machine. Are we open to investment? I'm always open to having people contact us interested in Navy at a later stage. For the time being, we're good but who knows what tomorrow will bring. Okay, so one last shot. What have I not covered that you would like to tell the audience? I just think that the audience needs to know that there are avenues and ways to getting to that energy resilient future that we're all looking for in terms of being able to make good use of the energy that we're producing. And I really feel that if we look at the complete picture of the energy load, we can make better use of the energy that we have and be able to distribute it equally to everyone. That way there shouldn't be a point in time in the future where there's an energy deficit for anyone. And be able to solve this problem and be able to distribute energy equally. Oh, let's have the last slide up which has your contact information. So there you go. That's how we can contact Carlos up there in Canada where it's getting colder. And we also have his website. We have his telephone number and we have his email address. So Carlos, thank you so much for sharing your technology with us. This is really breakthrough stuff. I haven't seen anything like this. I'm in the field. So well done. I love your philosophy. I love how you're using like waste plastic in the ocean. God, we have a lot of that already. And I love your company philosophy that if anybody goes to the website, they can see it and you're actually living it. So it's really good. So thank you so much, Mitch. Really appreciate the time. So we've been talking to Carlos Nunes from Aurora Industrial Machines and we're saying aloha now and we'll see you next Wednesday.