Welcome to Hyliion's Tech Fireside Chat. Today, I'm joined by Josh Mook, our Chief Technology Officer, and we're gonna be diving into our KARNO generator. So this is a solution that we see being able to solve distributed power generation, where you actually make your own electricity on-site, and reduce your dependency on the grid. So this is a, this is our KARNO. It is a linear heat generator. A lot of people think about it as it's like a internal combustion engine. That's not the case at all. You actually need to take all you know about internal combustion engines, throw that to the side. This is a heat gen set. We'll talk about in more detail, but there are really five key things we're gonna be covering today that differentiate this. So the first is, it has superior efficiency, so we're getting near power plant level efficiency out of this small generator that would normally take hundreds of acres out of a power plant. This solution is truly fuel agnostic, can run on fuels like natural gas, hydrogen, even ammonia, and when it's running on fuels like hydrogen and ammonia, you are able to unlock having zero carbon emissions, which leads us into the third one, the low emissions profile. Zero carbon emissions on some fuels, and our unique flameless oxidation process that we're gonna show you today unlocks the ability to have much lower emissions than a normal internal combustion engine. The fourth is durability, so this gen set has no oils, no lubricants, and it's really designed to deploy it and then forget about it. And then the 5th is, it's stackable. So think about it, where each one of these shafts is about 50 kW of power output. As you need more power, you just put more shafts together to make the desired power output level. So those are the 5 benefits we're gonna kind of keep bringing up in today's session, but with that, I'll turn it over to Josh to talk about what is a heat engine, how does it work? Yeah. Thanks, Thomas. So, as we mentioned, this is not an internal combustion engine, so what we're gonna do is walk through the sort of thermodynamics, what makes the system work side to side, and then get into how we make that heat secondarily. So the system is made up of four major components: your electric machine, your compression space, your expansion space, and your reactor. So we'll go through those one by one. First, let's start with the electric machine. So inside of the electric machine, we have a shaft, and I have an example shaft here, that is oscillating back and forth inside the system. These have magnets attached to them, and those magnets move within a set of coils, which create the electricity to either go to your site or to back to the grid, depending on the application. But in order to make that movement, what we do is we expand and contract a sealed gas inside of the system, and we do that through the compression and expansion space here. So in the compression space, we're taking that trapped gas, we're cooling it down through a closed water loop, or in a combined heat and power scenario, something that's connected to your building's heating. In that case, the gas contracts and cools down and helps pull the shaft to one direction, and then simultaneously, we're heating and expanding the gas in on the other side to increase the gas pressure, and again, apply force, which moves that shaft to the other side. Both of the sides here are operating together, but out of phase with each other, such that that shaft can oscillate back and forth at its natural frequency with high efficiency. But we do have to make heat, in most cases, in order to be able to initiate this movement, and so we do that through our reactor here on the end. This is where we'll bring fuel and air together, and we'll react those using the flameless oxidation process, and that heat is then captured by our hot side and transferred into the system. Traditionally, heat generators have been really difficult to implement because it's quite hard to move hot gas through the system and just transfer heat across metal boundaries. In this case, we're using additive manufacturing as a key unlock for us, both from a design and manufacturing perspective, and we'll dig into those, both components and the manufacturing process coming up. Before we go look at some parts, as you think about that shaft being slowed down on one end, how much force is being applied to it to change the motion? Yeah. So as the shaft comes to a stop, and then we re-accelerate it, we're putting about 4,000 pounds of linear force in there to move it to the other side. Very neat. All right, let's go look at some parts. We now wanna show you what some of these parts look like within the KARNO. So as Josh mentioned, you really have four main components: your linear motor, which is just, you know, coils and magnets, and then you have these three parts on the outside, which these are the parts made through additive manufacturing. Now, one of the questions we get asked a lot is, "Well, do you need to use additive? Can't you just do conventional manufacturing?" And the unique thing with each one of these parts is, there are geometries within these that really just offer major unlocks to get us that efficiency, to help improve the size of the system that you couldn't get if you made this through conventional manufacturing. So, you know, Josh, maybe to start us off, can you share a little history of, you know, where additive was 10 years ago, where we are today? And, I mean, this is something that you personally have had a huge influence on. Yeah, absolutely. So, you know, 10 years ago, additive was really being brought up through the aerospace industry, specifically for use in jet engines. So, you know, critical components that had high expectations in terms of durability and performance and all the same things we're talking about here, but really, you know, high consequence of failure. And so, as a result, we really focused on developing the materials, developing the process, developing the machines to be able to produce these highly capable parts like you see here in front of you today. So the other question we get asked a lot is cost, right? So if we take, you know, a component like this one, from the outside, it looks really basic, right? But here's a cutaway of the inside, and you can see, I mean, that is extremely complex, right? You could only unlock that through additive manufacturing. You couldn't even make that through conventional practices. But, you know, cost-wise, where are we at on, on this curve of, of is it economical to use additive? Right, yeah. So there's a couple things that drive cost in additive. One is the speed of the process. So additive is very much on sort of a Moore's Law of its own, where it's increasing in speed dramatically year over year, and we're certainly taking advantage of that in our process. The other is, how much material do you use, and are you using material for, for non-really good additive application? So this part's a great example, where you see just an unbelievable amount of complexity inside of it here with the heat exchanger and the other bits to enable the flameless oxidation process. But what you don't see is a lot of sort of unused or, or I'll say, wasted material that's gonna drive cost. And so by keeping the material usage down, by keeping the machine speed up, we can keep cost at a good point. So 10 years ago, additive was really only used for aerospace, healthcare. Today, you even have automobile manufacturing companies starting to use additive for their production lines, or production processes. The thing is, though, you don't wanna make conventional parts through additive, right? If you can make it through standard manufacturing, that's not the right part to print. It's parts like this that have really unique geometries that you wanna make with additive. So we have some of our additive machines here behind us. Why don't we go take a look at how these parts are actually made? Behind us here are some of our additive machines. You can see they come in different sizes, different scales, as well as different speeds. But let's first start off with talking about additive, right? So it's kind of like 3D printing. I'm sure many of you are familiar with plastic 3D printing machines where you melt plastic, it goes around, lays down a layer, and then you do the next layer. Well, metal additive manufacturing is not that dissimilar, but the way it works is you lay down a bed of powder, a bed of metal that's in, like, a dust format, and then a laser goes around, and it actually zaps the metal, welds it to the layer below. Then, once it's done with a layer, the part drops down a little, and you lay down a new bed of powder to start that process over again. So as you're making a part, like, how many layers are actually in one of these parts? Yeah, it depends on the size of the part, but we will normally have 5,000 or so layers at a thickness of 20-100 microns per layer. So then the unlock here is, we talked about speed earlier, so how do you get these machines to be faster, or what has happened to make them faster? Yeah, it's all wrapped up around really two things. One is the design, and the other is the machine. And so from the machine perspective, it's how much energy can you put into that weld at any given time? And so we can get energy by both higher laser power, as well as more lasers working together simultaneously on a part. And, the machines over the years, you've seen that progression of more lasers, higher power, and then we take advantage of that through our material properties. And then from the design perspective, it's really only using, again, the material that you need, so you're not wasting time melting components that you don't need. But also, using the energy effectively, we nest parts, or we sometimes have multiple parts print simultaneously, and that helps reduce the cost. Now, within these machines, there's kind of two aspects. You have in here, where the actual printing process is happening, but then you also have the extraction area. So once a part's made, you actually have to remove it from that powder, and this creates another unlock, which is very limited waste. Yeah. So it's not atypical that we have 99% reuse on our powder, and we'll continue to reuse it over and over again until it's essentially eliminated. Again, only use the material you need and not anything more. So that gives you a little overview of how these parts are actually made. We next want to go take a look at the reaction process, that flameless oxidation process we mentioned, and how that works within the KARNO. We're now here in one of our test areas in the facility, where we're actually able to showcase the flameless oxidation process happening. So the components behind us here are kind of the outermost units of the KARNO generator, which is where the fuel is reacting. You can see that process happening. So we're bringing in natural gas. We're combining that with air, and then what's unique is we're reacting the fuel. You can see all the metal components around are actually glowing orange because they're so hot. But because of that unique flameless oxidation process, you actually really can't even see a flame, and that's one of the unique things that offer us that low emissions within the KARNO generator. Yeah, another interesting observation in this process versus, like, an internal combustion engine, is you'll notice this process is continuous and complete, but it's not a series of explosions like you would normally see in an internal combustion. Behind us here, this is operating on natural gas. We're now gonna shift and take a look at what this process actually looks like if we run it on a conventional fuel like diesel. As you can see here, we have the diesel system running in the flameless oxidation process. It's very similar to that you saw in natural gas. You're seeing a very clean flame with minimal soot and particulate, which just shows the cleanliness of this system versus a traditional internal combustion process. The last thing we wanted to showcase today is the KARNO generator actually running, and then we actually brought in a diesel engine as well, to be able to do an A to B comparison to showcase the size difference, as well as the noise difference between the two. So, before we fire up the KARNO generator behind me here, so this is a four-shaft alpha unit. This is one of our pre-production units. This generator will produce about 125 kilowatts of power output. The production ones that are gonna be about the same size footprint as this will be about 200 kilowatts of power output. But this gives you a good sense of just the size, scale, and the noise levels coming out of it. The diesel engine here is a 180-kilowatt engine, and one of the other things you'll notice is we've got the doors open on this one, as well as we don't have any shielding on the KARNO. So as you're looking at the decibel reader, we anticipate the KARNO deployed in a stationary production box with sound deadening around it, will be about 67 decibels at about 6 feet away. You can see our room is already even louder than that level, so you're gonna hear it be a little bit louder than that, but you'll get a good comparison of a diesel versus the KARNO with no sound deadening around it. One of the other things that we talked about in today's presentation was durability. Josh, can you cover a little bit about why we expect our system to be more durable than a conventional diesel? Absolutely. So when you think about the KARNO system, you know, we talked about how it's a sealed system with no oils or other fluids inside that need to be changed regularly. And so, as a result, you're gonna get about 20,000 hours of average life out of that system before requiring an overhaul. If you compare that to an internal combustion system, where you're gonna have a few thousand hours of life, so a significant reduction compared to the KARNO prior to overhaul. But in addition to that, you're gonna have every 100 or so hours, regular oil changes or other maintenance that needs to occur. All of that you can, you can just avoid on the KARNO completely. Perfect. All right, well, with that, we'll go ahead and fire up the KARNO. We appreciate you joining us here today for this tech overview of the KARNO generator, and we'll now go ahead and take some questions. Well, thank you again, all, for joining us today. Hopefully, that was a good overview of just how the KARNO technology works, getting a little bit more of an in-depth view of what differentiates this technology. But we wanted to focus today's call on actually taking questions from all of you, and starting to address them and hopefully shedding some more light on the solution. So with that, we've got a bunch of questions that have already come in. As a reminder, if you've joined into the webcast, please go in and submit any questions you have, and we'll do our best to answer them. But we'll start off the questions. We got our first one that came in from Twitter, from Magni, who is asking: How fast can you print the KARNO? How many prints do you need to scale up? And at last, do you need any certifications to deliver, and how close are you to achieve this? So maybe we'll start off with, let's do printing speed, and then we'll talk about certifications. Yes, sure thing. So for printing speed, you know, today, I would say our longest parts take a few hours. I'm sorry, a few days to print from start to finish. And those are increasing, like we mentioned in the video, year over year. We anticipate being in the hours mark, you know, in the not too distant future. Yeah. So print time is continuing to get faster Yep. As you said during the presentation, it's like the Moore's Law, right? Right. Printers are getting much faster. Even the ones you saw in the video, they have different speeds just 'cause of some were bought more recently versus Yep some were a little older. Another question also coming in from Twitter, from David, is: What are the specific applications where the KARNO generator is most likely to be adopted first? So this is a great question, and, you know, we see a few different opportunities. One is prime power, so that would be like, think about a hotel, a hospital, a warehouse, a facility like the one we're in, where you actually use the KARNO generator as your primary power source, and now the grid actually becomes your backup power supply. So prime power is one that's obviously a massive market opportunity. But then there are some other unique sectors, like, for instance, this morning we announced that we successfully ran the KARNO generator using gas that would normally be flared. So it was field gas from the oil and gas industry, and it specifically came from the Permian Basin, from one of our partners that we're working with, who we expect will be one of the initial customers, and we'll share more on that in the not-too-distant future. But using flare gas or field gas to produce electricity, you can similarly do that at, like, waste gas out of a landfill. Then EV charging we see as a great opportunity, as well as matching renewables, right? So if you think about wind and solar, it's a great source of electricity, except for if the wind's not blowing or the sun's not shining, so we can offset that. So those are a few of the initial market sectors we plan on going after, but you know, I think EV charging, waste gas, and then prime power are some of the really exciting ones. All right, next question that we got coming in from David is: Compared to conventional, traditional generators, what is the expected efficiency increase of the KARNO generator? So, Josh, you want to take that? Yeah. So, you know, all of this obviously depends on your baseline, but the way we think about the KARNO generator and the system is we look at it always as an entire system. And so when we talk about, you know, numbers approaching 50%, that's sort of the net system, right? If you think about generators that you would maybe use today, traditional diesel generators, it's not atypical that you'll see half of that, or at a minimum, a 20-25% reduction relative to where we're gonna be in our system. So pretty tremendous step change that really moves the needle on things like operating costs and just, you know, fuel usage as well as emissions. In the video, we had the diesel gen. Yep. I think you actually looked up the spec sheet. Yeah. What was the efficiency? That one's around 20-25%, all- when it's net, all said and done. So we're more close. You know, 50-ish number- Right is our ballpark. So, all right, so next question here is coming from Donovan Schafer from Northland Capital. And Donovan's question was: You've talked before about putting power back onto the grid to within your facility in Ohio. Can you clarify if that was done in conjunction with the utility, and all the way that it was in line with the utility's requirements, and what specifications they would require for tying into the grid? So you worked specifically on that. Absolutely. So the answer is yes, that you know, we had to work with you know, local authorities as well as the utility to get what's called a grid interconnect, which allows you to connect to the grid and be able to push or pull power from the grid. And so that was done all by. There's IEEE standards that we comply to, as well as you know, safety requirements, not only for the device but for the line workers. And all of that was complied and worked through it to do that demonstration. Sure. So next question coming in from Ralph is: Can a KARNO be used for peak shaving operations? And absolutely, yeah. So I talked a little bit about, you know, these different use cases. Peak shaving is another one that we can go after. And, you know, for anyone who maybe isn't familiar with peak shaving, so throughout the day, your power consumption fluctuates, right, in a facility, at your house. And so, in some instances, utilities will actually charge you more for when you're consuming more power. And so peak shaving allows you to kind of offset that and keep your power consumption more steady that you're pulling from the grid. So we can absolutely do that. One other thing that I think this brings up a good opportunity to highlight is, you know, the philosophy we have around the KARNO is, if you own one of these generators, you want to run it- Let them run. Right? It's very different than, you know, a diesel gen set, like the one we showed in the video, which is more, you're only gonna really use that if you can't get your grid hookup, if the grid's down and you need backup power, like, you know, the maintenance, the costs associated with those gen sets just don't bode well for prime power. Versus with the KARNO, it's more the opposite of, if you own it, we think you should be running it. It should be a very low-cost electricity and a very low maintenance cycle. All right, so next question is coming in from from Graham, from Raymond James, and question is: For the Permian Basin natural gas tests announced this morning, does the gas have to meet any specific standards regarding impurities such as sulfur content, nitrogen hydrates, or even heavier hydrocarbons? Yeah, so you- Hydrocarbons, not hydrocarbon. Hydrocarbons, right. Yeah. So, I mean, one of the advantages of the KARNO system, and the fact that it's a sealed system, so all the working fluid is sealed from where the high gas is generated, is that you're fairly tolerant to impurities and other things in the gas. And so, that, combined with using some, you know, advanced material solutions for our hot side, give us good durability to things like sulfur, as an example. That being said, you know, the gas, any of the items in the gas that are, let's say, inert or not participating in the reaction process, they're gonna pass right through the system and out the other side. We do have to still be cognizant from a, you know, from an emissions perspective of what's in that initial gas, but for the most part, the generator is fairly insensitive to the content of that gas. A follow-up question that came in on that is: Can you talk about the durability of the KARNO when used in oil and gas applications? Yeah. So I mean, this is why we're doing all the testing, right? So we can continue to learn, you know, how the durability for different gases, how it comes out. But in general, again, because that system is sealed and isolated from where the gas is made, you're not gonna see an impact on, like, the pistons or the other working elements of the generator. What we do watch very closely is any reaction that we have with the metal components of what we call the heater or the hot side heat exchanger, to watch for any degradation there. But so far, you know, I think we're lined up really well for success for a wide, broad set of gases. Maybe just on that, can you talk to, like other people refer to gens ets as fuel agnostic? Right. How do they mean Fuel Agnostic versus how do we mean Fuel Agnostic? Yeah, when we mean fuel agnostic, we mean part number identical, right? And so in other words, the same piece of hardware that was installed on one fuel can be used on another fuel as well. More typically, what you see is when people refer to fuel agnostic, they say, "Well, maybe the block is agnostic, and you need to go replace the head and the valve train and all these other components." That is not our case. We really can handle most of that in software, by optimizing, like, the fueling schedules and everything to accommodate the different gases. Yeah, and we've even seen some people say: Well, we can run on hydrogen, but only up to a certain percentage- Right of hydrogen. That's not the case for the KARNO. No. We can run 100% hydrogen. Yep. Another question that came in from Twitter, from Maestro, which is: Will the KARNO R&D for stationary applications also extend or continue for vehicles and marine applications? Could we conceive a reintroduction of the KARNO Hypertruck as a system kit? So this is a great question. I'll maybe start with just a little background over the past month for Hyliion. So as I'm sure many of you are aware, we had a pretty significant shift within the organization where, you know, we had kind of two businesses going. We had the both powertrain and then the KARNO generator. We decided, due to some changes we were seeing in the powertrain side of things, to really refocus our efforts purely towards KARNO for the time being. We do still have the Hypertruck technology, but we've put that on the shelf and saved it for later. So as we think about how KARNO is going to evolve, well, one of the, or the reason that we initially acquired the KARNO technology out of GE was we saw this as a great fit for on-road applications. So the generator that we're actually developing is designed to not only meet stationary specs, but also to meet vehicle, or as mentioned in the question, marine-type specs. And actually, fun fact, that diesel fuel you saw running was specifically focused towards marine diesel fuel. So, so we see marine as being a great use case, but then also, with the vehicle side of things, you know, we'll obviously look at the market, see how it evolves, and look for opportunities to bring the KARNO generator back into the vehicle space when the time is right. One thing that I think sheds a lot of light on this, though, is just the timeline for certification, which maybe you can touch on, like, what's, what's the certification needed for stationary versus vehicle? Yeah. You know, as you would imagine, for on-the-road applications, the certification requirements are much more stringent in terms of, you know, how that's going to interact in, like, a crash or other safety phenomenon. And so you don't have a lot of that on the stationary application. So we're able to very quickly comply with the stationary requirements while we work potentially, you know, others in parallel for on-road applications. Yeah. And not a question that has come in, but maybe talking about emissions on that end as well. So, you know, there are kinda CARB has laid out future emissions plans. Mm-hmm. Maybe just talk to where are we at on this spectrum versus those futuristic limits? Yeah, absolutely. So we're designing to the most stringent, even future limits that we've seen. So at the moment, we have a good path to compliance for even all the proposed rules that we're aware of, and certainly have significant margin relative to all today's requirements. Yep. And one question we get a lot is, do you need a catalyst? Do you need a DEF system? Because, you know, the latest discussion in the industry is, like, internal combustion's running, engines running on hydrogen, they're gonna need DEF systems, right? Yeah. Where do we sit on that? Yeah, today we don't, we don't use any after-treatment systems whatsoever today. And we're really trying to hold ourselves to that standard, because that just gives us a tremendous amount of additional runway if we wanna go even lower in the future. Great. All right, another question that came in from Twitter, from Silent Alert, is: Is the intent for, to fully print the units or use traditional subtractive methods of manufacturing? Also, can you speak more about the Libertine partnership, and how will that impact the future of the KARNO? So you wanna talk about the printing one, then I'll talk about the Libertine side of things? Sure, yeah. So for printing, I mean, we already use a mix of additive and traditional today. You know, I think in the video I try to explain, you really wanna use additive where the complexity level buys its way onto the application, right? What you're doing really is takes a big advantage from the complexity or the geometrical freedom that additive provides. So the one that's the most obvious is heat exchange. You can get levels of heat exchange using additive design techniques that well exceed anything you've ever seen from a traditional manufacturing standpoint, so we use additive there. There are other parts of the system like, you know, simple pressure vessels or structural components where it wouldn't make sense, and we use traditional means there. You already see a mix today, and we spend a lot of time trying to optimize that mix for, you know, maximizing performance while minimizing cost. Perfect. And then shifting over to the linear generator side of things. So, the unit that was showcased in this video, similarly, the unit we showcased at ACT Expo and publicly, that does have a Libertine linear motor in the center of it. As we move this technology into production, though, as we think about the units that we'll be deploying later next year and into 2025, our plan is actually to shift to using an in-house design and built linear generator system. And Josh's team are well underway with the design and development of that solution. And that will really give us the ability to not only own the technology around the linear generator, but then to have those three elements, right? The chiller, the heater, and the reactor, those will be all Hyliion components as well. Yep. All right, next question that came in from Matthew is: Do you anticipate the KARNO to successfully meet the military standards, such as needed in deploying in environments like high temperatures and dust found in the desert? Yeah, the simple answer is yes, and we are, o ur design already has taken all those MIL standards into account, and we're designing to those right out of the gate. All right. Another question is from Steven: For the KARNO, can you supply enough KARNOs for a project in, you know, West Texas, like out in the Permian Basin, where you'd maybe need, like, 10 megawatts of power output? So you wanna talk about how we can scale up to that? Yeah, absolutely. So, you know, as we've mentioned before, we today have these 200-kilowatt sort of building blocks, is the way I think about it, and we assemble those together into, you know, essentially whatever power level that the application would call for. There is no sort of upper limit on that, from a, like, feasibility or a technology perspective. So then it's really gonna come down to just, you know, does it make sense for that application, et cetera, et cetera. But we're very excited about the scalability of the system up to, you know, really, whatever, sky's the limit. Perfect. All right, and a question that came in from Samir is around how soon can we see KARNO set up in BEV charging? So, our deployment plans are the H2 of next year is when we're actually going to start some of these customer deployments. Great news is we have actually numerous parties on the BEV charging side of things that are intrigued and want to deploy the KARNO in their applications, and maybe just to talk about that. So what they're facing is they're trying to go out and deploy 50 EV charging pedestals, and they're going to their utility provider, and their utility is telling them, "Hey, come back in 3 years, and maybe we can then give you a grid interconnect." Or, we even heard out in California, one was, you know, quoted even closer to 10 years, or there was another instance where the utility just flat out said, "Until we start building more power plants, we are not going to have the capability of putting an EV charging site at your location." So these are some of the pain points that EV charging sites are facing. So as they look at the KARNO, they're looking at it as a way that not only can they deploy the EV charging setup faster, right? Because once we're into production, then you're just bringing your own power plant and putting it on site. But now you're also offering the ability to be fuel flexible, as well as have a very high efficiency level and lower costs of electricity generation in most instances. So, H2 of next year is when we plan on the initial BEV charging setups to be put into place. All right, next question has come from from Keith: So how does the KARNO compare to a diesel genset for fuel use or efficiency? And we've talked a little bit about the efficiency, but maybe fuel use and, you know, the difference there. Yeah, fuel use generally is gonna scale with efficiency. So if the KARNO system is running at, let's say, twice the efficiency of a comparable diesel genset, you're also gonna get half of the fuel usage in that amount of time. Or maybe another way to look at it, if you have a, you know, fixed amount of fuel, like in a storage sort of setup, you can run twice as long in the same amount of time. So it scales one-to-one with efficiency, fuel use does. Yeah. All right, a question that's come in from Keith is: How does a hydrogen-fueled KARNO compare to fuel cell in efficiency and fuel use? Yeah, so compared to a fuel cell, I mean, there's lots of different flavors of fuel cell, but if we just kinda talk about it generically, generally, the KARNO generator, on a net basis, is gonna be very similar to that of a fuel cell. You're gonna see, very similar output, you know, after all of the balance of plant and other items. So if you're just saying fuel in to electricity, usable electricity out, let's call them a wash, for most purposes. All right, so we're getting a little technical here. A question in from Samir is: Does the DC output of the generator pose any concerns about harmonics in the electrical system, and are there any measures to place to address such potential harmonic issues? Yeah, so I mean, every electrical installation is a little bit different, right? Yeah. You know, for example, when we do grid-connected electrical systems, we often have an isolation element to it, right? To isolate your system to the grid. And so I would say that in general, you know, it's not like a concern for every application, but in some it makes sense. On the demos we've done, like, islanding or battery installations, we don't have any isolation required in those instances, so very much a case-by-case basis. Also on the technical side is a question in from Keith, which was around the metals Mm-hmm that we're actually using in the KARNO generator, and are those corrosion resistant from, like, salt air or water in the environment? So you wanna touch on that a little? Yeah. So the metals, you know, we use a variety of metals, just like any application. Most of them are gonna be your steels, your aluminums, your coppers, and then we use some cobalt-based alloys, specifically for our hot side. And so for our hot side component that sees all of that hot gas and lives in that day in, day out, it is about a 50% cobalt alloy. And the beauty of that is that it's highly resistant to things like oxidation and corrosion that you would be concerned about for having, let's say, not so clean fuels, as an example. These inert elements are very nearly impervious to those and gives us a huge advantage. A follow-up on that one was: Will diesel-fueled KARNOs meet the Tier 4 requirements? Absolutely, yes. All right, a question that came in from Twitter. Apologies, I just lost the question. There it is. So, from Ivan, which is also getting a little deep on where we get the heat from here. So does the KARNO have additional applications, i.e., in nuclear or geothermal or hybrid solar, where you can actually use other sources of heat to actually produce electricity? Yeah, this is a great question because we often talk a lot about fuel as a source of heat, and that's because, you know, in the infrastructure that we mostly have, that's the most practical. However, as we've, you know, hopefully said multiple times, the engine element of this generator itself only needs heat, right? And so whether that heat comes from nuclear or geothermal or concentrated solar are absolutely valid ways to get that heat and then move it into the system. And for all intents and purposes, the system won't know the difference between heat entering that comes from nuclear versus heat entering that comes from fuel and a chemical release. It works exactly the same after that point. That is also what gives us a lot of excitement around the potential of just how, you know, future-proof a system like this is to those adapting sort of heat sources in the future. Yeah. You know, one thing that we've even discussed is, as you think about that linear generator setup, you have the three outer parts Yeah and then the linear motor in the middle. If you change what type of, of heat source you're using, it's really only the end part- The output part. the reactor that actually needs to change, right? Yeah. The heater, the chiller, the actual gen set, that can all stay the same 'cause that, that sealed, you know, middle section there, all it needs is heat coming in- Yeah And that's what's going to make the electricity. So it's a, it's a fascinating concept. We've obviously had a lot of discussions with, like, customers around this, and it's, it's very common they get into the call, and people think it's a linear internal combustion engine, right? Right. We've heard it time and time again, and then it takes a little while to like, "Wait a second, this thing actually makes electricity off of heat, and gas is expanding?" Like, you need to change the way you think about it, but Yeah it's almost like the difference between a internal combustion engine and a fuel cell, right? Different. We're kind of a different way of producing electricity. We're really heat in, fuel o r heat in, electricity out, as opposed to fuel in, electricity out. Yeah. It's a good way of thinking. All right, so a question that came in from John is: If natural gas was available, how would you determine the economics of using the KARNO as a prime power source? So it's a good question. I mean, the best way to think about it is, if you have natural gas, you're gonna know what your cost of natural gas is, and then you're gonna have about a 50% efficiency of converting the, you know, the BTUs of natural gas into kilowatt hours of electricity. And so, you know, that's the very simplest way. Mm-hmm. That's how we usually calculate it for customers. It's just a 50% efficiency. Now, there is another element that we get into when we're talking with people about prime power applications or industrial applications, which is: Is there a way to use the wasted heat, right? So there's combined heat and power cycles, which allows you to not only have our 50% efficiency of taking the fuel and making electricity, but now there's also that other 50%, or not exactly Mm-hmm because there's some losses due to blowers and things like that, but maybe another 40-ish% of, of power that is heat, right? And, or energy that is heat. And so if you have a facility actually like our one up in Ohio Yeah where there's a thermal loop already in the building, we can just pump that heat into that and use that to heat the building. Absolutely. Yeah, Combined Heat and Power, you know, you can achieve total efficiencies in excess of 95%, which just again lowers that operating cost significantly and almost makes the application a no-brainer. One question that's come in from Dave is: Has the KARNO engine to date already received any emission certifications? Or maybe talk about the path to get there. Yeah. So no certifications, like, officially yet, but all of our testing, we test to the same standards and using the same process that will be used to achieve those certifications here in 2024. And so we have high confidence that we will comply to all those, but no certifications yet officially. Question, another question in from Donovan, from Northland Capital, is: I have a question about the use of untreated natural gas in the Permian. Since this untreated gas would presumably have some impurities, where do those impurities go if they don't turn into emissions or pollution of some kind? Yeah, so, you know, the way to think about the system is we take all the hydrogen bonds that are in the system, or as many as we can, we break those apart, right? So whether those are a hydrocarbon or just, you know, hydrogen, we pull the heat out of those, the energy. But anything that it does not participate in that reaction, like sulfur, as an example, is gonna just find its way out the same way basically that it came in. And so we do need to make sure, you know, we work with customers very closely on making sure that they comply with all the emissions requirements for that. But from the perspective of the KARNO generator, it doesn't really see those or have any influence on those whatsoever, kinda in and out the other side. Another question from Samir is: What is the minimum and maximum load in comparison of a 30%-80% for a conventional generator? So, this is a great question. If you think about, like, the normal efficiency of an internal combustion engine, there's kind of a sweet spot that you would wanna operate it in, where you're gonna get most efficient use of the fuel. If you're below that sweet spot, then you're you know gonna have a less efficiency or similarly, if you're well above that sweet spot at, like, 100% power, your efficiency goes down, even though your power level is going up. With the KARNO, what's really unique is it's got a very flat, in comparison, efficiency curve, right? And so, I think it's around, we're saying, like, 40%-100%. Is that or what? Yeah, kind of the sweet spot- Yeah. -is kind of that 40-100%. would be where you're getting a pretty flat efficiency band within the KARNO. And this is great for applications where, you know, you might have oscillating power levels, and now you're not giving up really, y ou know, you're not giving up a lot of efficiency if you need to change how much power you need. The other big advantage we see in that regard over fuel cells is, for anyone who's really familiar with fuel cells, they can have a very high peak efficiency. Mm-hmm. Very, actually very comparable to our peak efficiency. But then, as you get into high power levels, it falls off a cliff, right? Right. The efficiency becomes very bad if you're up at about 100% power output. So now what fuel cell providers are doing is they're saying, "Hey, you know, you're gonna really wanna operate this maybe around, like, 60% power or somewhere along those lines. So size the amount of fuel cells you need so that you're only running them at 60% power." Well, the problem with that is that becomes very costly, versus we're quoting a, you know, 200-kilowatt generator, and we're telling customers, "No, you can really run this thing at 200 kilowatts. Yeah. When we quote this rated power, which is 200 kW, the intention is you will run at 200 kW, and it will sit there potentially its entire life, and that's how it's been designed. Yeah. Another question in from Keith, which is: How do you switch between fuels, and can it be done on the fly? Absolutely can be done on the fly. That's a great question. So the beauty of, again, this continuous reaction process is that as the fuel content changes or as the energy content changes in that fuel, the system can automatically sense those changes based on how the temperatures are trending, as an example, and will adjust to compensate those, and the easiest adjustment and most practical is simply flow rate of that fuel. You need a certain, you know, grams per second for one energy content, you need a different one for another. And so that can happen seamlessly, and at any moment, without alerting the system that it's happening, it will self-detect that and adjust for that. Question in here around regulatory hurdles as well, and do we see any regulatory hurdles that could impede the adoption of the KARNO generator? This question is coming from David on Twitter. Yeah. So from a regulatory standpoint, I mean, we're working to meet and exceed all of the known and foreseeable regulation, and so we do not see today any showstoppers relative to that. We're gonna continue to try to exceed all of those, with margin. So a question coming in from Hatem, which is: What is the manufacturing period for KARNO generators in the bigger scale size, so 1,000-1,200 kilowatts? So, maybe just first thinking about, like, how do we get to 1,000 or twelve hundred kilowatts? So our plan is actually that, those shafts that we showed you, which, in production will be about 50 kilowatts power output, we're just going to kind of duplicate those, in order to produce higher power levels. So, if you needed 500 kilowatts of power output, that's roughly 10 shafts that you would need in order to produce that level of power. So as we think about, you know, 1,000 kilowatts, that would be, you would get five of these 200-kilowatt four-shaft systems in order to meet that power. So this is very different than a maybe internal combustion engine, where you hear those companies talk about they have a, a 12-liter, a 15-liter, a 70-liter, a 90-liter, engine, right? Where they actually design entirely different generators based on the power levels. The KARNO is very different, where now we just stack these shafts together in order to meet the desired power output. So our plan, in terms of bringing this into production, is our first units are going to be 200 kilowatt hour box or 200 kilowatt boxes. And then you could stack those together, and then we also see on our roadmap doing a 2+ MW container, which would be about the size of a 20-foot shipping container, where you would have a bunch of those shafts on the inside, and then you would combine together the radiator fan cooling loop system, versus in those 200-kW boxes, you're actually gonna have independent cooling loops per each 4-shaft setup. So, in terms of getting to those higher power levels, we can do it with those 200-kW boxes because you just stack them together, or our plan is also to introduce a 2+ MW container size unit as well. All right. A question in here from Gordon is: Will the KARNO be used for freight rail applications to possibly replace or exist, assist existing diesel- electric powered engines? So this is an area that we are exploring. It's probably, it's probably not gonna be the first use case for it, but one that we do see as a great application of using KARNO in the rail sector, which, as you mentioned, a lot of locomotives today are using diesel and diesel gen sets that actually already convert it into electricity. Already hybrid. Yeah, and then it's an actual electric drive locomotive. A lot of those players have also started experimenting with hydrogen and fuel cells. So we see the KARNO as a way where you could actually kind of make a fuel-agnostic locomotive, and then you could power that off hydrogen, natural gas, diesel, or whatever fuel is available in that area. So, once again, it's probably a great use case. Not the first thing we're going after, but it is something we are exploring. Question in here from Magni, which is: Can you tell me more about the adoption in the oil and gas industry, and how it will evolve out to customers? So we mentioned this morning that we tested the initial gas coming out of the Permian Basin. That actually came from a customer, someone that we're working closely with, and you know, that was the initial showcase of, hey, the KARNO can actually run on this fuel. We're now in discussions with that customer around you know, getting them into the early adoption program here for the KARNO generators, and so more to come on that in the not-too-distant future. But you know, the way we're thinking about 2024 adoption here is, we're gonna be limited, or at least how we're looking at it now, we're gonna be limited by the number of units we have versus the demand that we're seeing from individuals. So what our plan is, we're going to space those units out into a couple of different industries. So oil and gas, we're thinking, is one of them, EV charging is one, prime power is one, and then what we'll do is, build the backlog of customers in those different sectors and showcase to them, those initial deployments and then, you know, kind of use, you know, one customer in a specific use case to kind of prove that use case, and then use that to, to springboard into other, potential customers in that space as well. So, we're being really specific on, you know, who are going to be those initial adopters, what industries are they in, and trying to make sure that we cover a few of those different use cases, as opposed to putting all these just into oil and gas or putting all of them into EV charging. A question here from Yaron is: Current size is 50 kW per shaft. Mm-hmm. What do you think the max size of future units will be? Yeah, I mean, from a thermodynamics perspective, there's not a maximum that says this, you know, thou shall not exceed. Well, really, the reason we settled on this 50-kilowatt size was to kind of find that right balance between power, the applications that it would go into. So, you know, not having too many for large applications, too few, you know, but not—but still meeting the needs for the smaller applications. But then in addition, our manufacturing process today does have some limitations around the size that we are, and so we've sized it to kind of, you know, optimize all those parameters. And I think that that size is probably the right size for the near future. But we certainly, as opportunities arise or as use cases arise, we'll explore other sizes also. I would say it's probably more likely for us to even go smaller before we go bigger in shaft size, just given the, that 200-kW minimum limit is still maybe above some of the, some of the use cases we could go and, and provide a solution for. And in our Investor Day, which was back in June, we even showcased that on our roadmap, not only do we see scaling up to that, 2+ MW container size, which still the shafts stay the same size, you just put more shafts together. We do see an opportunity of moving to, like, a 10-25 kW, more of like a household generator Right. size unit. Actually, it's pretty funny when we're having these customer discussions, all the customers, you know, they're looking at this from, like, they're adopting it commercially at, you know, large buildings. They then say, "Well, when can I get a household unit one, right? Can you put me first on the list for one of those?" Just 'cause I think people really like the idea of, you know, don't buy a generator for outback your house that only gets used a couple hours a year. Buy a generator that becomes prime power, and now the grid is your backup. So we'll take just a couple more questions here. But one in from David on Twitter is: How often does the KARNO generator require maintenance, and what is involved and the cost and downtime associated with that maintenance? Yeah. So the maintenance, there, you know, there are no regular, I'll say, maintenance items. It's not like, you know, there's no oil that you have to change. There's not elements that need regularly serviced, right? The system will watch its own health and obviously alert you if something, an anomaly arises. But the first planned maintenance activity is gonna be around that 20,000-hour mark on average. And during that maintenance, you know, we would anticipate there would be a single-piece part replacement, so the component that has reached end of life, you'll replace that. You know, in our lab, we could do that entire thing in a day, two days. You know, I think from a probably good opportunity to do a layout and inspection of everything, I would anticipate sort of a week timing for that. Yeah. Question in from Hafiz is: What is the maximum duty cycle of the genset, and are there considerations for continuous operation in these specific applications? So maybe to touch on the continuous operation, that is one of the big unlocks of the Mm-hmm. KARNO is, we want this thing to be running 24/7. We want it to run continuously because it's designed in such a way where it's just inherently have such low maintenance, right? Yeah. There's no oils, there's no lubricants, there's only one moving part, and even that, that part also. It actually rides on what are called air bearings. So best way to think about it, it's like a, the- Air hockey. Air hockey table, right? You know, when you're playing someone, that puck is just kind of floating along the top of the table. Well, that's almost what's happening with that shaft, even to a greater extent. Mm-hmm. And so it's designed for inherently low maintenance. And so from that standpoint, if you have one, you wanna run it. And last question we'll take here is from Donovan, which is: Would the commercialization of the KARNO generator for the use in oil and gas markets, once again, mean developing a trailer-mounted version, or is this something that can be made small enough to fit in the bed of a pickup truck? So to give you kind of rough dimensions of this 200-kW box, and this includes not only the 4-shaft system, but then also your DC to AC converters, as well as your fans, radiator setup, we're looking at about a 2-foot wide box, but then it is about 8 ft by 6 ft. From a dimension standpoint, our intent is that, you know, these will get brought out to sites on a trailer, and then they could be deployed and be stacked next to each other to be very energy-dense from a space standpoint. That's actually something we've seen compared to some of the other Mm-hmm. clean tech solutions out there. Our footprint is in the order of magnitude of, like, one-tenth compared to some of these other ones. Yeah. Not all of them- Yeah But some of them. So we actually see that this has a really strong energy density, and will allow for people to deploy or take a pretty small amount of land and actually deploy a pretty good amount of power output. So with that, maybe just in conclusion here, so we threw a lot of information at you. Appreciate all the great questions. We went pretty deep on the technical side in some areas. We like to joke, Josh can go basically as deep as anyone wants to go on the technical side, so appreciate some of those great questions. But hopefully, this gave people a snapshot of where we are at today with the development of this KARNO generator, some of the, the opportunities, the unlocks that this produces compared to other generator solutions or, or power solutions. But wanna be clear that, you know, we are still in the development of this solution, right? We are running it, at our facility. Next year, as we've mentioned, is when we actually move that to, deploying it with customers. So, today hopefully gave you a good snapshot of where we are today. And this will continue to evolve. So some of the things that we mentioned, like power outputs of shafts, you know, we'll continue to tweak those. What fuels it could be run on, right? Yeah. We obviously just announced this morning that successful testing with gas from the Permian Basin. So, we still have a lot of exciting things ahead of us here. The technology development is going very well. There's an amazing team behind this, working on this every single day to bring this into commercialization. And we continue to thank all of you for logging in, joining these discussions today, so you can be a part of this journey with us as we bring this solution forward. And, you know, hopefully bring a solution that truly can really change the way we think about distributed power generation, and where you can actually source your electricity from. So thank you for joining us, and we hope to chat again soon.