Name: This CEO is so passionate about solving energy transition he hasn’t taken a vacation in 20 years
Uploaded: 2024-03-06
Duration: 7 min 2 s
Description: “If hydrogen is the only solution and we are the largest hydrogen company, it is our responsibility to do that,” Air Products CEO Seifi Ghasemi said on Fortune’s Leadership Next podcast.

“If hydrogen is the only solution and we are the largest hydrogen company, it is our responsibility to do that,” Air Products CEO Seifi Ghasemi said on Fortune’s Leadership Next podcast.

This CEO is so passionate about solving energy transition he hasn’t taken a vacation in 20 years

Photo illustration by Fortune. Photograph provided by Air Products.

Leadership

Do you ever think about? Oh, jeez, I'd like to stop and go play golf for uh go fishing or, I mean, you seem very driven and there's a lot of time ahead of you on this uh uh uh on this Hydrogen challenge, you're gonna keep at it. I'm absolutely going to keep at it and I'll have no issue disclosing my age by September. I will be 80 young to be president. I love what I'm doing. I do not have an any other hobbies. I really work seven days a week and vacation. The last time I took a vacation, I was for our 35th anniversary, which was in 2004. II. I love, I really love what I'm doing. And believe me, I have more energy and I travel more and I work harder than when I was 40 years old. So I am amazed and impressed, but I do kind of want you to take a vacation at this point. I hope my wife is not listening to this podcast. Welcome to leadership. Next, the podcast about the changing rules of business leadership. I'm Alan Murray and I'm mia Air products was founded in 1940. So we are about 84 years old and uh our founding father, what he did was that in 1940 he went to the steel companies and said that, look, you are using a lot of oxygen rather than making oxygen yourself. I have a new invention with the oxygen compressor. I can come and invest, make oxygen for you and sell it to you over the fence just like as if you are buying electricity over the fence and people like that, and that is how our business got started. Then in the late 19 fifties, when the Russians sent their sputnik up into the air, the US government decided that, well, we need to have a serious space program and in order to have that you needed liquid hydrogen to put these rockets in there. So they commissioned their products and we were the first company to come up with liquid hydrogen. We developed the technology. So it's now more than 64 years that we are producing hydrogen. So our business is atmospheric gasses, then hydrogen, which is now a significant part of our business. And we are by far the largest producer of hydrogen. A lot of people think hydrogen uh may be part of the answer to our energy problem, the energy transition. I know you've made big investments in this area. Uh How quickly do you think they're gonna pay off? How close are we to having hydrogen products? That can replace the fossil fuels we're using now. Well, uh obviously, the speed that they, that they move forward depends on the customers deciding when they want to convert. But if the world wants to move to taking action to reduce global warming, there is no other option but hydrogen, hydrogen has always been and will always be our only source of energy. There is no other source of energy right now, we produce a lot of hydrogen but the CO2 goes into the air. So you either need to use hydrocarbons to produce hydrogen and capture the CO2 and sequester it or you need to make green hydrogen, which is use electricity to break down water to make green hydrogen. Right now, we are executing significant projects both in green and blue. How quickly before green hydrogen is a competitive uh energy source for uh the global economy. Well, when you say competitive, if uh you have to use it, then it is it, it is, it is not the the transition, it is not an economic transition. This is not as if you are going to go from wood to coal and you say, or coal to oil and you say it's cheaper that either the world has to do something about the CO2 that they put into the air. And it is a requirement that you cannot put CO2 or if you put CO2, there is a significant tax that is what is going to drive this thing because you cannot sit back and say I want clean hydrogen which competes with dirty hydrogen or dirty fuel. It's just not going to happen. So you have to have a mechanism to justify the additional cost because of the benefit which is by a mechanism, you need subsidies or taxes. Basically. No, we are not going to go to a low carbon board. If you do not have the support of the governments to encourage using it, it's not going to happen by itself. You've been very aggressive about this. You've pushed far further than the market wants you to push uh how much is it within the control of companies to push this energy transition forward? 100% a company like us, we had, I mean, it's not easy to go and convince your board that I'm going to invest $8.5 billion in Saudi Arabia and I don't have any customers. So we discuss these things very openly. And the fundamental thing is if we turn out to be right, that is then they are the leader and being and they will make a lot of money, maybe not next year, but 10 years from now. Well, absolutely. And the best example of it is I was involved in these discussions 20 years ago about electric cars because my company was making lithium for electric cars, previous company, previous company. And every time I talk to investors at that time, you know, electric cars. That's the dream. And they would go and talk to Mercedes and GM who were telling them that is. And besides that, if electric cars are going to happen, it's four wheels and a motor, we can do it better than somebody else. Now, we are 24 years later and we have a company with a market cap of 500 billion. And those people who say it's not going to happen have a market cap of 50 billion. And by being the first mover, they have developed the brand and all of that. So we think that in business, if you never take a risk, you never do anything. So you have to make a judgment, you have to have it what you watch call and then put your resources and make it happen.