This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeState legislatures are writing data center rules faster than they can verify the demand forecasts underneath them. Fifteen states accounted for 80 percent of data center electricity demand in 2023, a single hyperscale campus can arrive as 15 to 20 percent of a utility's demand, and the transmission to serve it takes five to 15 years to build. On this episode of Volts, David Roberts works through Climate Cabinet's Taming Data Center Turmoil series with Saleem Chapman, who leads the group's electricity affordability policy work, on why Georgia's regulated utility, PJM's capacity market, and ERCOT's competitive market each left ratepayers holding the risk, and what a state can require before it approves a project, while the facility operates, and after the deal is done.Chapters:00:00 – Introduction02:49 – How Climate Cabinet came to the data center fight03:58 – Three things that make hyperscalers unlike past industrial loads07:51 – Warning signals: forecast opacity, gas dependency, unconditional subsidies13:44 – Siting near overburdened communities and the Memphis case15:34 – State preemption versus local control18:31 – The same failure pattern in Georgia, PJM, and ERCOT23:52 – Why not just ban data centers outright28:07 – The framework, and what to require before approval34:54 – While operating: real cost pricing and on-call load flexibility37:39 – Scenario-based planning and the utility incentive problem39:37 – After the deal: new and matched clean energy43:48 – Siting standards and performance-tied incentives50:27 – Existing facilities and the threat to build elsewhere55:41 – Which states are ahead, and step one for lawmakers

This is a free preview of a paid episode. To hear more, visit www.volts.wtfVolts published eight conversations in July on subjects with nothing obvious in common: an Arizona utility board election, Minnesota smart meters, land value taxes in Spokane, silicon battery anodes. Yet six of them arrived at the same constraint. What stops energy infrastructure from getting built in the United States is more often written into law than into physics. On this episode, David Roberts pulls one stretch from each July conversation into a single hour, with two Minnesota utility regulators, a Spokane city council member, a Hawaii state senator, a co-founder of a battery materials company, and more.Chapters:00:00 Introduction: a new format for Volts01:22 Arizona: winning the utility elections nobody watches07:04 Minnesota: the smart meter data nobody uses12:40 Spokane: how property taxes reward empty lots17:31 Hawaii: the education gap in state energy policy22:13 The data center backlash is a politics story27:41 Why America can't build transit: procurement32:41 Clean energy after the IRA: the glass debate38:26 Silicon anodes: the other half of the battery44:47 Closing: tell me if this worked

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeMaterials in lithium-ion battery cathodes have continuously evolved since the 1990s, but anodes have stubbornly remained graphite. Now, finally, there’s some innovation on that side: silicon anodes, which engineers have struggled to master for a decade, are finally coming into wide commercialization. They enable up to five times the energy density of graphite anodes, charge many times faster, and are poised to revolutionize the battery market. In this episode, I talk with Rick Costantino, co-founder and CTO of Group14, which is selling a silicon-carbon composite material for anodes. They’re already selling to dozens of large battery manufacturers and expect silicon anodes to completely take over the market by 2030.Chapters:00:00 – Introduction and the graphite anode problem01:54 – Why silicon, and why it kept failing06:26 – From pharma to batteries: Rick's path09:24 – How SCC55 works: silicon in a carbon scaffold14:38 – The payoff: energy density and charge speed18:59 – A drop-in material, and scaling in South Korea21:11 – Where the batteries go: phones, EVs, drones24:29 – Cost versus graphite26:20 – Cycle life, calendar life, and safety31:26 – Supply chain and the silane bottleneck36:26 – Pairing with LFP, DOE support, and phones40:30 – Bringing the cost down, and competitors43:27 – The five-year outlook

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeThe Inflation Reduction Act (IRA) established substantial tax credits for wind and solar power. Trump’s One Big Beautiful Bill Act (OBBBA) eliminated those tax credits. How much damage did that do to the overall trajectory of clean energy in the post-Trump world? A new research commentary argues that the damage was less than many had feared and that the road forward for clean energy is less about restoring those credits than about easing the permitting and interconnection constraints inhibiting renewable energy. Today I talk with author Lily Bermel about the modeling her commentary is based on and the somewhat controversial conclusions she draws from it.Chapters:00:00 The IRA, the OBBBA, and the case for optimism03:25 OBBBA - Why Bermel ran the analysis05:50 The headline numbers: 74, 71, 6708:07 Decomposing clean: solar and batteries hold, wind takes the hit12:14 The lag analysis, and the 'glass half full' perspective15:27 2.8 gigatons, and losses you can't get back18:01 The third scenario, and Trump I versus Trump II21:49 What the model leaves out: manufacturing, LPO, loans23:07 Interior's permitting campaign against wind and solar27:22 The demand surge and behind-the-meter gas32:15 Nuclear restarts, geothermal, and clean firm35:31 Booms, busts, and the electrification wave42:22Transmission, interconnection, and the ceiling46:41 Tax credits versus permitting reform51:46 Durability, polarization, and preemptive surrender60:01 Can enough storage make renewables firm?66:48 Grid utilization versus building new grid70:52 Final reflections: 2021, and what Bermel would do with a trifecta

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeAmerica once led the world in building transit and now leads the world in what transit costs, roughly three times the international average per mile, measured not against authoritarian megaprojects but against Italy, Spain, and Japan. On this episode of Volts, David Roberts talks with Will Poff-Webster of the Institute for Progress, who put together the new Transit Abundance Playbook, and Stephanie Pollack, former head of the Massachusetts Department of Transportation and former acting administrator of the Federal Highway Administration. Their argument is that the costs are a policy choice: federal funding rules teach transit agencies to plan on a napkin and do the real work years later, to hire the lowest bidder over the one they know will deliver, and to defer to anyone holding a veto, while highways operate under looser versions of the same rules. As Pollack puts it, "if you hate transit, you should spend less on it." A surface transportation reauthorization bill is coming, and two of the playbook's proposals have already reached the House version.Chapters:00:00 Introduction: why cars work against cities03:25 Agency culture or federal law: where does the fix come from11:31 Planning: how federal funding enforces bad habits20:10 Overdesign: the Green Line stations and the frequency-first test23:40 Buses: why every agency orders a custom fleet26:53 Procurement: lowest bid versus best value32:56 Veto points and Italy’s conference of services39:56 Permitting: environmental review as a NIMBY tool45:28 State capacity: why consultant brain took over51:46 Labor costs, automation, and Section 13(c)56:19 Is any of this politically achievable?1:03:28 Final question: one reform each

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeData center opposition has gone from nonexistent to organized in about two years, roughly 120 moratoriums across 38 states, and it does not track proximity: Gallup finds 70% of Americans oppose a data center near them, while only 8% of opponents live near one. On this episode of Volts, David Roberts joins Energy Empire hosts Jigar Shah and Jamie Nolan, along with Arnab Pal of Deploy Action, for a crossover conversation, and his argument is that everyone is solving the wrong problem. The hyperscalers could buy their way to consent for a rounding error, batteries in basements, solar on roofs, funded schools, lower bills, and they refuse, which David reads as a symptom of low social trust that no amount of better modeling touches. “This is not a technocratic problem that you can just solve with a few switches,” he says. Thirty-six governors go to the ballot this fall having to answer for it.Chapters:00:00 Intro: a Volts and Energy Empire crossover01:25 Has the AI case been made? Energy vs. AI as the real revolution04:23 The backlash by the numbers, and hyperscalers' botched PR08:20 Animal spirits, low social trust, and the information environment12:46 Enshittification, lost jobs, and why governors still want data centers15:50 The local playbook: schools, bioswales, batteries in basements17:18 Bespoke industrial rates without setting a bad precedent22:33 How utilities earn: spend-to-earn, the distribution black box, efficiency30:11 Gendering the grid: gas as firm, renewables as soft37:57 NERC's level-three alert and the case for more batteries39:29 Both/and: distributed capacity as serious supply45:33 Abundance's missing half: state capacity, staffing, NEPA48:55 The midterms: 36 governors and the politics of affordability53:33 Hope vs. fear: the Mamdani lesson and the information environment

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeMost of the energy decisions that touch daily life in America get made in state legislatures, and the people making them are increasingly new to the job. In smaller states, a freshly elected lawmaker gets a pad of paper, no staff, and about 150 lobbyists at the door, then votes on billion-dollar energy budgets in a landscape where the technology changes faster than anyone can track. On this episode of Volts, David Roberts talks with Hawaii state Senator Chris Lee, co-founder of the Electric Innovation Initiative, a bipartisan network betting that education moves electrification faster than mandates: put lawmakers in front of working technology, connect them across state lines, and let affordability carry the argument where climate framing will not. As Lee puts it, "nine times out of ten, people just don't know what they don't know."Chapters:00:00 Introduction03:39 How electrification clicked: the 2008 iPhone moment06:10 The education gap: why the initiative exists11:35 Proxy staff and cross-state validation15:44 What lands on the tours: eVTOL to the data-center win-win20:51 Plain 'electrification': the bipartisan framing bet26:28 Climate hushing and Hawaii's two-track proof30:17 Policy that spreads: e-buses, heat pumps, RFPs37:37 Utility business-model reform: Hawaii's PBR law42:03 Affordability after the federal subsidies45:22 Hawaii under pressure: LNG and the Lahaina grid51:53 State power against federal hostility55:19 The ten-year vision and the closing advice

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeProperty taxes are two taxes stapled together: one on the land, one on whatever gets built on it. Put up an apartment building and the bill goes up. Pave the lot for parking and it stays low. It discourages building and rewards land speculation. The answer? Tax the buildings less and the land more. The idea of a “land value tax” goes back 150 years, but implementing it today involves navigating tricky constitutional issues. In this episode, I talk with Greg Miller of the Center for Land economics about the rationale for such taxes, and with Kitty Klitzke, a Spokane, Washington council member, about the difficulties of putting it in practice in a real city. Chapters:00:00 Introduction03:22 Henry George and the case for taxing land08:12 How property taxes work now, and what a split rate changes11:26 Land value taxes and upzoning as complements15:18 The Pennsylvania record and the reassessment problem18:51 Vancouver, and why homeowners outlast the policy24:03 Estonia, Singapore, and the Scottish Islands26:53 Washington's uniformity clause and the building exemption33:18 Kitty Klitzke on twenty years of Spokane infill43:27 What Spokane needs from the state legislature45:25 Single family homeowners and the Division corridor48:34 The assessor objection52:45 What the Spokane modeling shows59:31 The plan for next session1:01:44 Virginia, Kentucky, and cross-partisan momentum

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeMinnesota regulators Sydnie Lieb and Pete Wyckoff on why utility distribution spending — now a third of capital budgets and the biggest driver of rising bills — escapes the scrutiny the rest of the grid faces, and how to fix that.00:00 - Introduction04:23 - How distribution is regulated differently than generation and transmission09:25 - Why distribution matters now: an aging system and the build-more incentive14:00 - Contestable “mandatory” spending: undergrounding, DERMS software, capitalization22:19 - Reliability standards and the cost of chasing 100 percent28:42 - The MISO comparison: valuing a lost hour, and the scale of the numbers35:12 - Non-wires alternatives: batteries, the Xcel project, and modeling gaps40:31 - What regulators should require: AMI forecasts and beyond the prudence test47:22 - The speed objection: does more analysis slow things down?50:10 - Why spending caps and rate freezes are the wrong fix52:40 - Spending more anyway, and recent Minnesota PUC disappointments55:09 - Restructured markets: does the same logic apply?58:38 - The vision of a well-functioning process and scaling it nationally

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeFollowing a stunning clean energy victory over right-wing donors on an obscure Arizona utility board, organizers are setting their sights on a much bigger prize: the state’s powerful utility commission. I chat with Charlie Fisher and Ning Mosberger-Tang about how they used disciplined messaging to overcome massive opposition spending and historically abysmal voter turnout. We discuss whether this localized ground game can scale to a massive statewide electorate and help build a durable, nationwide clean energy political machine.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeYou might have noticed that it’s kind of hot out there. And it’s only going to get worse: global demand for cooling is projected to triple by 2050. Finding a way to cool spaces and people without frying the planet is a crucial climate challenge. I’m joined by RMI’s Ankit Kalanki to unpack the hidden world of AC refrigerants and testing standards, the crucial distinction between lowering temperatures and dehumidifying, new AC technologies on the horizon, and the building and urban design changes that can take some of the pressure off.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeIn this episode, I talk with GM Energy executive Aseem Kapur about General Motors’ move into bidirectional EV charging and home energy management. We dig into the practicalities of turning hundreds of thousands of EVs into mobile backup generators, how to navigate a patchwork of 4,000 different utilities, and what it takes to get everyday consumers to see their cars as grid assets.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeThe UK has just released its seventh carbon budget, recommitting to the aggressive climate targets suggested by its nonpartisan Climate Change Committee. Can the Labour government actually hit those targets while keeping energy prices for the British people under control, even amidst a newly hostile political landscape? In this episode, I talk with the UK’s new climate minister, Katie White, about those challenges and more.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeThe North American Electric Reliability Corporation has issued a historic warning about AI data centers. I chat with energy experts Colin McCormick and Doug Bryan about the unique electrical engineering challenges of giant computational loads that can abruptly drop hundreds of megawatts of power in the blink of an eye. We dive into the upcoming regulatory battle between hyperscalers and operators, the sudden rush for firm gas generation, and how software updates and battery storage could eventually make data centers a tool for grid stability instead of a liability.

This is a free preview of a paid episode. To hear more, visit www.volts.wtfWhy is the latest fossil fuel crisis pushing the world toward rapid electrification instead of a drilling boom? To find out, I chat with Tim Sahay and Kate Mackenzie, hosts of the Polycrisis newsletter and podcast, about the concept of “polycrisis” and the global rise of manufacturing-heavy electrostates. We examine the massive global diffusion of cheap electrotech and discuss why American climate wonks need to look past domestic policy and start paying attention to international macroeconomics.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeIn the US, clean energy tends to get bogged down in red tape, but there’s one category that you can install immediately, with no one’s permission, because it plugs right into your wall outlet. This week, I chat with James McGinniss of David Energy about plug-in DERs — specifically, small batteries that commercial tenants can install without permits or landlord sign-offs. We explore the economics behind these micro-projects, look at how they aggregate into virtual power plants, and break down why this hyper-local approach could eventually outcompete massive utility infrastructure.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeWhy is clean electrification, the most exciting, dynamic, hopeful sector of the US economy, still such a 98-pound weakling in DC backroom fights? In this episode, I talk with investor and entrepreneur Steve McBee about Amped, his new effort to boost the industry’s political influence and give it a little swagger — by telling a more compelling story, getting better information to lawmakers, and pulling hundreds of billions of dollars in stranded capital off the sidelines.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeConventional punditry loves the narrative that woolly-headed progressive standards over-burdened federal climate spending and slowed everything to a crawl. In this episode, I talk with Betony Jones about her time designing labor policies at the DOE and what she learned from interviewing dozens of companies that received federal funding. We explore the difference between bad rules and weak administrative capacity, how the DOE successfully streamlined century-old Davis-Bacon compliance, and why creating high-quality jobs is essential for global competitiveness.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeAs affluent homeowners defect to heat pumps, the massive costs of maintaining America’s aging gas pipelines are being concentrated onto a shrinking base of customers who can afford it least. To understand how to prevent an impending utility death spiral, I talk with the Building Decarbonization Coalition’s Kristin George Bagdanov and Panama Bartholomy. We discuss the legal limits of a utility’s “obligation to serve,” the potential for gas companies to transition into geothermal thermal energy networks, and why the US has suddenly become the global leader in heat pump sales.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeAre data centers and electrification going to break the US power grid, or are they the secret to making it cheaper for everyone? In this episode, I talk with Pier LaFarge of Sparkfund about Minnesota’s landmark decision to let Xcel Energy deploy batteries directly into local distribution networks. We look past the politics and map out how a battery-saturated system can socialize the benefits of load growth, ushering in an era of boringly reliable, low-cost energy by 2030.

This is a free preview of a paid episode. To hear more, visit www.volts.wtfBen Eidelson and Anay Shah run the Stepchange podcast, which recently put out a magisterial four-hour (!) episode on the history of the US electricity grid. I talk with them about some of the colorful characters and stories involved, the big fights and broad lessons learned, and how the history echoes in today’s political and technological struggles.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeBoiling water to make steam for industrial processes consumes an enormous amount energy around the globe, yet it has proven remarkably resistant to electrification. In this episode, I talk with Addison Stark of AtmosZero about why replacing the standard fossil-gas boiler requires an entirely new approach to industrial heat pumps. We discuss the engineering behind his high-temperature system, the challenges of scaling up, and the growing imperative to get free of global LNG markets.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeMost people think that coordinating the behavior of thousands of distributed energy resources requires some kind of third-party middleman, like an aggregator managing a VPP. My guest today, veteran research scientist Bruce Nordman, believes there’s a better way: dynamic, time- and location-specific retail prices, communicated directly to consumer devices, which would cut out the middleman and leave more value with customers.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeToday, coordinating a whole-home retrofit — or even just getting a heat pump — involves confusing research, a parade of contractors, and wildly varying quotes. It’s a broken system that practically pushes people to just buy another gas furnace. In this episode, I’m joined by Zero Homes CEO Grant Gunnison to discuss ways to improve this system for both customers and contractors.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeHistorically, investing in energy infrastructure has been the exclusive province of wealthy individuals and large institutions. But that’s changing, and my guest today is part of it. I’m joined by Energea co-founder Mike Silvestrini to discuss how his platform allows retail investors to back international solar projects with buy-in as low as $100. We talk about the unique risks and rewards of building microgrids in emerging markets and why an unapologetic, yield-driven approach might be the best way to do real good in the world.

In this episode, I sit down with financier Tom Steyer to discuss his 2026 run for governor of California. We dig into his pledge to cut the state’s notoriously high electricity bills by 25 percent, how he plans to break the stranglehold of investor-owned utilities through local competition and smarter grid utilization, and the delicate politics of pushing a climate-forward agenda when voters are primarily focused on the immediate cost of living. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

The think tank Ember just released its yearly Global Electricity Review. In this episode, I chat with co-authors Nicolas Fulghum & Kostantsa Rangelova about the biggest stories in the global power sector in 2025. We geek out over the record-breaking scale of solar deployment, the game-changing role of batteries in shifting midday power to the evening, and the tantalizing possibility that India will not follow China’s coal-heavy development path and that global fossil fuel generation has finally plateaued. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

This is a free preview of a paid episode. To hear more, visit www.volts.wtfHeatmap’s Robinson Meyer joins me to unpack the sheer madness of the current news landscape. We discuss the energy implications of the Iran war, the vexed politics of permitting reform, Microsoft’s retreat from carbon dioxide removal, the lessons of the IRA, the lingering pastoralism of the environmental movement, and much more.

Beth Bafford spent years designing Climate United, a revolving fund meant to push out $7 billion of Greenhouse Gas Reduction Fund money to underserved communities. She had barely begun sending out grants when Trump shut the program down and rescinded all the money. In this episode, I talk with her about that experience, the ongoing legal fight to reclaim some of the money, and the central importance of finance in clean energy policy. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I welcome back my old friend Jigar Shah to discuss the current hullabaloo around explosive electricity demand from new data centers. We dig into why its stupid for tech companies to build their own behind-the-meter natural gas plants, how this approach is wrecking equipment and destabilizing the grid, and a better, smarter, faster path forward. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeThere are some circumstances — think disaster recovery zones or forward military bases — that cry out for portable, reliable, resilient power. I talk with Lauren Flanagan about Sesame Solar’s self-contained nanogrids, which use solar PV, batteries, and hydrogen storage to provide energy that works around the clock in remote or inclement environments.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribeWhy do climate funders prefer cutting checks for electric vehicles over fighting for dense, transit-oriented housing? I talk to Ben Holland, who recently interviewed major climate foundations about their anti-urbanism bias, and returning guest Caroline Spears, who is working to pass climate-friendly housing policy at the state level. We discuss why obsessing over easily quantifiable emissions reductions is blinding the movement to massive, tractable wins, and why ignoring zoning reform is no longer an option for serious climate advocates.

It can be stomach-turning, watching the Trump administration torch federal climate policy. But what if some of what's burning wasn't working particularly well to begin with? Hannah Safford and Loren Schulman of the Federation of American Scientists' Center for Regulatory Ingenuity make the case, not for defending or trying to rebuild the status quo regulatory regime, but for imagining something better. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

The US power grid runs at about 50% capacity on average — built for its worst day, underutilized every other day. As demand surges from data centers and electrification, utilities are racing to build more infrastructure. But Ian Magruder, who heads the new industry-backed Utilize Coalition, argues there's a cheaper, faster path: better use what we've already built — it will enable faster growth and bring down ratepayer bills, potentially by billions. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Dakota Gruener of Reflective walks me through her organization's new project, which maps the gaps in our scientific understanding of stratospheric aerosol injection — currently the leading candidate for directly cooling the planet. We get into what we don't know (including a factor-of-two disagreement on basic aerosol physics), who's already doing this without oversight, and the unsettling governance question of who controls the Earth's thermostat once humanity has grabbed it. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

The explosive energy demand from data centers is breaking our grid, pushing desperate developers to build their own on-site gas plants just to get online. To figure out how we avoid locking in decades of new fossil fuels, I’m joined by Camus CEO Astrid Atkinson and Princeton’s Jesse Jenkins to break down their proposed alternative. We dig into how adopting flexible grid interconnections and clean, battery-backed “power parks” can meet this massive load growth without abandoning our decarbonization goals. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

New York Governor Kathy Hochul is trying to delay or roll back the state’s landmark climate law in the name of affordability. I’m joined by activist Pete Sikora to discuss the governor’s claims, what would actually serve affordability, and the larger politics behind this puzzling own-goal of a fight. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I’m joined by Kunal Girotra, who helped start and run Tesla’s residential energy business before leaving to start his own company. With Lunar, he has tried to create the most consumer-friendly possible battery and software ecosystem, which can seamlessly plug into solar panels, other devices, or VPPs. We talk about lessons learned and the future of residential electrification. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

I’m back with part two of my conversation with Jan Sramek, founder of California Forever, about his plan to build a brand-new city in Solano County. We get into the nuts and bolts of the urban design, discuss affordability and sustainability, get into governance issues, and look forward to what might happen next. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I’m joined by Jan Sramek to discuss California Forever, the much-debated proposal to build a brand-new, sustainably designed city in Northern California. We explore the urbanist vision at the heart of the project, including a street grid inspired by Barcelona superblocks, and address the elephant in the room — the stealthy land acquisitions and the billionaire backers. Is this an urbanist utopia in the making or a grandiose con job? This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

If the world takes its climate targets seriously, the coming decades will see fossil fuel systems shrinking as clean energy systems grow. In this episode, I talk with associate professor Emily Grubert about the issues that may arise during this “mid-transition” period. She has fascinating new study on the physical and financial cliffs that fossil fuel systems may go over as they decline and reach their “minimum viable scale” — and argues that public ownership of these dying industries might be the only way to gracefully phase them out. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I chat with Catalyst host Shayle Kann about the most pressing unresolved questions in the clean energy world today. We explore whether data center gigantism will break the grid, if the smart home revolution is destined for platform enshittification, whether billionaires should start testing solar geoengineering, and more. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

PJM is the largest wholesale power market and transmission planning region in the US. Currently, it is stuck between a rock and a hard place: on one side, rising demand from data centers; on the other, a choked and congested interconnection queue that can’t keep pace. The result: rising prices and political discontent. I talk with Clara Summers of the Citizens Utility Board about how PJM can solve this dilemma and get prices under control. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Meat is responsible for roughly a fifth of climate change, the lion’s share of deforestation, 70% of our antibiotic use, and quite possibly the next pandemic — and consumption is going up every single year, with no end in sight. In this episode, Bruce Friedrich of the Good Food Institute joins me to argue that the only way out of this mess is better meat: plant-based and cultivated alternatives that can compete on price and taste, the way renewables now compete with fossil fuels. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Utilities and their regulators are often protected by a "force field of tedium," but in this episode, I pierce the veil to discuss the complex machinery of utility profit-making. I’m joined by Joe Daniel of RMI to unpack the critical distinction between "return on equity" and "cost of equity," and why the former is almost always higher than necessary. We discuss how regulators can close this gap to lower consumer costs without hindering essential grid upgrades. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I chat with Dr. Sarah Kapnick about the core of climate science and the wild variables that have emerged in the last decade. We discuss the “accidental geoengineering” experiment of reducing shipping aerosols, the newfound ability to pinpoint methane leaks from space, and the legal implications of being able to attribute financial losses to climate change. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

How does a small, mountainous island with no interconnections and a massive industrial load clean up its grid? In this episode, I speak with Yeh-Tang “Ricky” Huang about the technical and political bottlenecks holding back Taiwan’s energy transition. We explore why the country has struggled to deploy wind and solar, the realistic prospects for advanced geothermal, and the absolute necessity of demand-side flexibility in such a constrained system. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Why do so many influential voices spend their time policing the manners of the left while the right dismantles democracy? In this episode, Michael Hobbes — cohost of the much-celebrated “If Books Could Kill” podcast — joins me to discuss the “reactionary centrist,” a type of commentator who believes that both sides are to blame for everything and demonstrates this by spending every waking moment scolding Democrats. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Rooftop solar costs nearly three times as much in the US as it does in Australia, largely due to the "paperwork tax" imposed by thousands of fragmented local jurisdictions. I talk with Nick Josefowitz of Permit Power and solar veteran Andrew Birch about how to slash these soft costs through automated permitting and standardized interconnection. We discuss how these bureaucratic fixes could unlock dirt-cheap energy for American families without the need for subsidies. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Everyone is talking about virtual power plants, but as I discuss with EnergyHub CEO Seth Frader-Thompson, not all VPPs are created equal. We get nerdy on the various stages of VPP maturity and the specific technical requirements that VPPs must meet to truly compete with conventional power plants rather than just acting as “enhanced demand response.” This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

I’In this episode, I chat with Swedish tech entrepreneur Jonas Birgersson about his radical plan to apply the architecture of the internet—packet switching, buffering, and decentralized routing—to the electricity grid. We explore how his “EnergyNet” concept uses power electronics to create galvanically separated microgrids that stop cascading failures and allow neighbors to share power directly. It is a mind-bending look at how treating electrons like data could lead to unlimited energy for a low fixed fee. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Conventional geothermal energy is limited to specific hot spots, but “closed-loop” geothermal, by going deeper and confining water to sealed boreholes, promises to work almost anywhere; it amounts to building a giant radiator, deep underground. I’m joined by Jeanine Vany and Mark Fitzgerald of pioneering closed-loop startup Eavor to discuss their newly operational plant in Germany and the many advantages of a system that requires no fracking and consumes no water. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I’m joined by Kate Slevin of the Regional Plan Association to discuss the triumphant first year of congestion pricing in Manhattan. We explore how the program defied its critics by boosting business and pedestrian traffic while reducing gridlock, without evident traffic spillover onto adjacent streets. We also cover the money that’s been raised for public transit and what the future holds for the congestion relief zone. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Hawaii Senator Brian Schatz joins me to discuss the energy policy landscape facing Democrats and how they should respond. We touch on the shift in messaging from “climate” to “affordability,” current Congressional Republican efforts on permitting reform in light of Trump’s anti-renewables crusade, the role of green groups in climate politics, and much more. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Why can Australian homeowners get rooftop solar installed in a week or less, for roughly 50 cents a watt, while Californians pay $3.30/w and wait months for interconnection? In this episode, I ask inimitable Australian energy expert Saul Griffith to walk us through the entire process — from quote to interconnection — to pinpoint exactly where the US system is broken and how we could fix it. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

The problem of misinformation in the current age, argues political scientist Samuel Bagg, is not that reliably truth-producing institutions and practices don’t exist, but that people have ceased to trust them. Changing that requires something deeper than factchecking or media literacy. It’s a matter of social identity, and solving it will mean reconfiguring the social identity landscape. I talk with Bagg about that daunting conclusion and its implications for democracy. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Senator Ruben Gallego (AZ) joins me to discuss his new energy plan, which combines elements of the Inflation Reduction Act with a new focus on permitting reform and small modular nuclear reactors. We get into all of it, from the promise of nuclear energy to the role community consultation. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Aliya Haq unpacks how her two decades in the climate movement have reshaped her view of what works. After six years working at Bill Gates’ Breakthrough Energy initiative, she has launched the Clean Economy Project, which will push for grid upgrades, market reforms, and innovation to make clean energy cheaper and more abundant. We wrestle with the politics of it all. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

I’m joined by Brian Turner and Kathleen Staks to unpack the details of the newly authorized Regional Organization for Western Energy (ROWE), a unique “à la carte” RTO designed to unify the western US grid without trampling on state independence. We discuss the transition from the existing imbalance market to a full day-ahead market, the safeguards built into the bylaws to protect state clean-energy policies, and the politics of getting 38 separate balancing authorities to cooperate. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Why is a deregulated state like Illinois suddenly embracing central planning? In this episode, I talk with Kady McFadden and John Delurey about the state’s decision to empower its utility commission to directly procure clean energy. We discuss why capacity markets are too slow for the current environment and their strategy of aggressively framing renewables and storage not just as green, but as the only “fast and cheap” way to protect ratepayers from price spikes. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

This is a free preview of a paid episode. To hear more, visit www.volts.wtfWith load growth projections all over the map and politicians zeroing in on high electricity prices, I take a step back in this audio essay to ask how we should build the grid in the face of massive uncertainty. The answer lies in modular, distributed technologies that strengthen the system regardless of whether the AI bubble eventually bursts.

Will cheap, DIY solar reach American renters? In Germany, millions of people plug solar panels directly into wall outlets like any other appliance, but in the US, red tape makes it ludicrously costly. I chat with Cora Stryker of Bright Saver about how “balcony solar” (AKA “plug-in solar”) is booming in Europe and making its way to America, starting in Utah. We discuss the technical and safety issues, the regulatory hurdles, and the solar “gateway drug” effect. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Energy strategist Kingsmill Bond joins me to explain why the transition to “electrotech” is unstoppable, whether or not politicians care about climate change. It’s not the reduced emissions, it’s physics (electrotech is more efficient) and economics (it’s cheaper). Despite political headwinds in the US, China and emerging economies are racing ahead with electrification and sector after sector is seeing peak fossil fuel consumption. There’s no stopping it: electrons will triumph over This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Environmentalism has typically focused on outdoor air quality, but climate change is pushing more people indoors more of the time, even as airborne pathogens and wildfire smoke challenge indoor air quality. I discuss the fight for better indoor air with Dr. Georgia Lagoudas, who recently coordinated a global pledge declaring it a basic human right. We dig into what pollutes indoor air, the technologies that can keep it clean, and the enormous social and economic benefits clean air in schools. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Distributed energy resources are everywhere, but connecting buyers and sellers is a coordination nightmare; I talk with James Johnston, whose company Piclo is tackling that problem head-on. He explains how they’ve built a transparent, open marketplace where utilities and other buyers can procure flexibility as a simple commodity from a wide range of sellers. We discuss how this model is already working in the UK and how it could allow data centers to pay for faster grid access in the US — potentially unlocking billions in private investment for VPPs. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I welcome back Caroline Spears from Climate Cabinet for a post-election debrief that, unlike last year’s, is full of good news. We explore how a slate of pro-climate candidates defied expectations in tough districts across the country, driven by a powerful backlash against the Trump administration. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I chat with Nick Chaset, CEO of Octopus Energy US, about bringing the company’s customer-focused, tech-forward model to America. We get into the details of how Octopus simplifies home energy management for its retail customers and its plan to help regulated utilities do the same. We also touch on ambitious ideas like the “Zero Bills” home and how to build gigawatt-scale virtual power plants that benefit both consumers and the grid. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

With the White House actively dismantling clean transportation policy, what can states do to salvage progress? I talk with former DOT policy advisor Liya Rechtman about a little-known authority that lets states transfer highway dollars to fund transit, EV charging, and bike lanes. We explore how governors can use this tool, but only if they act quickly. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Lately, everyone from Tony Blair to Daniel Yergin is calling for a “climate reset,” so I brought on clean-energy analyst Michael Liebreich to discuss his own, very different version. While others push expensive distractions, Liebreich argues that the inexorable growth of cheap renewables is already on track to displace fossil fuels, a “tortoise” strategy that will win without the need for crisis politics. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode I’m joined by Wilson Ricks and Killian Daly, who are involved in the process of updating the Greenhouse Gas Protocol that governs (among other things) corporate clean-energy procurement. We explore the proposed shift to requiring hourly, local matching for Renewable Energy Certificates (RECs), a change designed to end the “race to the bottom” where companies buy cheap, low-impact RECs to paper over the fact that being “100 percent clean” is genuinely difficult. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Redwood Materials has long dominated EV battery recycling, but what if they could drain every last drop of energy from those batteries before recycling them? I talk with the company’s CTO, Colin Campbell, about Redwood Energy, a new division doing just that by deploying used batteries as grid-scale storage at a massive scale. This isn’t just a side project; it’s a plan to turn a massive wave of incoming used batteries into a key resource for the grid. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

I chat with Sarah Goodyear and Doug Gordon, the hosts behind the unapologetic podcast “The War on Cars,” about their new book and the fight to reveal our car-dominated world as a political choice, not an inevitability. We explore the many ways automobiles suck, from the “motonormativity” that makes us angrier and more isolated behind the wheel to the devastating impact on children’s freedom and development. We also get into the positive, radical vision that animates their work: a future with fewer cars, where our streets are reclaimed for human connection and community. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

New York passed one of the most ambitious climate laws in the country, but is now struggling to meet its goals. I’m joined by Doreen Harris, president of NYSERDA, the agency on the front lines of implementing the law. We explore what’s working, from community solar to new transmission lines, and what isn’t, including the slow pace of scaling up renewables and decarbonizing transportation. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I talk with Seattle mayoral candidate Katie Wilson, a longtime transit and housing organizer who scored a surprise primary victory against the city’s establishment-friendly incumbent. Wilson makes the case for why her deep experience as a community organizer and coalition-builder is precisely the kind of leadership needed to restore faith in government and get big things done. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I chat with Quaise CEO Carlos Araque about unlocking geothermal energy on a planetary scale by drilling miles into the Earth’s crust. He explains how his company’s technology vaporizes rock with microwaves to reach depths where intense heat sends the water supercritical, packing ten times the energy density of conventional geothermal. The ultimate goal: persuading the oil and gas industry to put its capital and expertise toward mining heat rather than fuels. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Why should you care about a utility commission race in Georgia? Because it’s a national bellwether, a sign of how voters are going to react to skyrocketing power prices and a test of whether Democrats can get their act together. I talk with candidate Peter Hubbard and activist Brionté McCorkle about the state’s Public Service Commission, its coziness with utilities, and what reform would look like. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I chat with investor Clay Dumas of Lowercarbon Capital about the growing use of “advance market commitments” (AMCs). We discuss how this simple idea — a group of buyers commits to purchasing a set amount of a product if it can be produced — can derisk investment and jumpstart innovation in the climate economy’s toughest sectors. Clay explains what makes for a well-designed AMC and how it can accelerate the path to commercialization for everything from carbon removal to green steel. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Data centers are creating a grid crunch, so what if they paid to solve it by upgrading our homes? I chat with Rewiring America’s Ari Matusiak and PG&E’s Carla Peterman about a new report proposing that hyperscalers fund household electrification to free up the grid capacity they desperately need. We explore how this reframes households as crucial energy infrastructure and creates a win-win-win for tech companies, utilities, and everyday people. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

High-temperature industrial heat for things like steel gets a lot of attention in clean energy world, but its somewhat less sexy cousin low-temperature industrial heat could use a little more. In this episode, I talk with Teresa Cheng (Industrious Labs) and Richard Hart (ACEEE) about how industries like beer, milk, and paper can decarbonize with industrial heat pumps and thermal storage. We dig into how electrified industry could help the grid, confront the hidden costs of sticking with gas, and talk through how grants and financing can tip the scales. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In the past, Africa's natural resources have often proven to be a curse, leading to exploitation, corruption, and immiseration of indigenous people. Now it finds itself at the center of another resource boom, this time around the critical minerals that will fuel the clean energy transition (lithium, copper, etc.). Will this time be different? Patrick Kipalu argues that indigenous land rights and informed community consent are not barriers to investment, but the only way to ensure stable, equitable development. We explore how African nations can leverage their resources to benefit their own people. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Dry printing of battery electrodes can avoid the toxic solvents and industrial ovens involved in the conventional wet process, which means a smaller physical and environmental footprint, but engineers have struggled to make it work at the needed scale and speed. Now a company called Sakuu says it has cracked the code. It is selling machines it claims will be able to print multiple battery chemistries, at competitive costs and speeds. I talk with CTO Karl Littau about the details and what 3D printing could enable in future batteries. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I dig into the debate over reforming renewable energy certificates (RECs), the instruments that allow companies to claim they're "100% renewable." I'm joined by Michael Leggett of Ever.green and Peggy Kellen of the Center for Resource Solutions to discuss the push for a "24/7" system that matches RECs to the exact time and place of consumption. We explore whether this seemingly intuitive change is the best path forward or if going too far, too fast could drive buyers from the market and slow decarbonization This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Today's electricity grids are kept stable by the inertia of spinning masses — mostly fossil fuel generators. But what happens when those spinning masses are replaced by inverter-based resources like wind, solar, and batteries? The answer is that inverters must take over the stabilizing job, becoming "grid-forming" rather than merely “grid-following.” I chat with two experts about how grid-forming inverters work, how many are out there, and what the future holds for them. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Lithium-ion dominates the battery world, but alternative chemistries are finding their niches. I talk with Landon Mossburg, CEO of Peak Energy, about using sodium-ion batteries for large-scale grid storage. They trade some energy density for a longer life and radically lower operating costs, thanks to an innovative, passively cooled design. We also explore the geopolitical opportunity of competing in a battery market that China doesn't already completely own. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

This week I talk with Dan Stein, whose organization Giving Green seeks to align climate philanthropy with the principles of effective altruism. But what does "effective" mean in the face of fossil fuel autocracy? We discuss the difficulties of measuring systems change and debate the limits of technocratic solutions. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Movement veterans Bill McKibben and Jamie Henn have been thinking about where climate activism goes from here. They argue for a new focus on celebrating and accelerating the miraculous global boom in solar power. We get into what it looks like to fight for building stuff, how to win the online information war for clean energy, and why the sun offers not just cheaper power, but a form of liberation. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I'm joined by Frank Rambo of the Horizon Climate Initiative to discuss "uneconomic dispatch" — the costly and polluting practice of running coal plants even when cheaper, cleaner options are available. We dig into why utilities get away with this, how the Trump administration is now trying to force them to continue via bogus "reliability" claims, and why fighting this practice at the state level is a huge, bipartisan win for both the climate and consumer pocketbooks. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I'm joined by Jake Higdon and Isabel Munilla, who helped develop the original "foreign entity of concern" (FEOC) standards for the Inflation Reduction Act, which sought to encourage domestic supply chains. We explore the security risks that prompted FEOC policy, the delicate balance required to do it right, and the absolute hash that Republicans made of it in their recent budget bill, to the point that it may kill the domestic manufacturing they claim to support. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, recorded live back in May, I'm joined by the one and only Jigar Shah to discuss Washington state climate policy and post-IRA policy in general. Jigar argues that to build political durability, the climate movement must shift its focus from shiny tech to solving everyday cost-of-living problems and that smart finance is the real key to scaling the energy transition for everyone. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

I'm joined by Alon Levy of NYU's Transit Costs Project, whose work documents how expensive it is to build transit in the US relative to the rest of the world. We discuss how countries like Spain and Italy build cheaply by relying on in-house public expertise and standardized designs, while the Anglosphere is captured by a costly ideology of privatization. Levy explains how applying these lessons could make ambitious projects like high-speed rail in the Northeast not just possible but affordable. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Ann Arbor voted to create a parallel, municipal electric utility that offers only distributed renewables, and Missy Stults is the woman making it real. We explore the nuts and bolts: buying existing solar for seed revenue, building microgrids in a city still served by DTE, and why DTE is — so far — more curious than threatened. If it works, the SEU could become the blueprint for every climate-ambitious town trapped in IOU territory. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Arc CEO Mitch Lee explains why the jump from gas-powered boats to electric boats is even bigger, in terms of quality and user experience, than the jump from gas-powered cars to EVs. EBs are strikingly quieter, have greater torque, and require much less maintenance. Oh, and despite what Trump says, they are also much safer and less likely to strand their occupants. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

I chat with Kostantsa Rangelova and Dave Jones, authors of a new Ember report, who find that solar-plus-storage costs have declined so much that it can now provide baseload-level power in sunny cities for less than the cost of new nuclear or even new gas. We discuss why even energy pros are behind the curve on this, how quickly the technology is improving, and why most of the world doesn't see natural gas as a viable option the way the US does. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

This is a free preview of a paid episode. To hear more, visit www.volts.wtfIn this "What the F is Happening" episode, I'm joined by Jane Flegal and Jesse Jenkins to perform a wake for the Inflation Reduction Act after the passage of the GOP's "Big Beautiful Bill." We sift through the wreckage to see what was saved versus what was buried, analyze the political forces that determined the outcome, and debate the core theory of change behind the IRA — and what lessons advocates should and shouldn't learn as they chart a path forward.

In this episode, I talk with Montana state senators Forrest Mandeville (R) and Ellie Boldman (D) about the bipartisan housing reforms their state has passed over the last two legislative sessions — reforms so sweeping YIMBYs have dubbed them the "Montana miracle." We discuss the unlikely coalition supporting the bills, the impact of the policies, and the generational divide that increasingly separates YIMBYs from NIMBYs. Also: why "housing is the new weed"! This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

PG&E, California's notoriously troubled utility, is trying to prove it can innovate, so I invited Quinn Nakayama, head of its new GRiD program, to explain how. We discuss its strategy of publicly outlining its problems to attract partners and its shift toward faster, more flexible interconnection for new loads like EVs and data centers. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

The frantic buildout of AI data centers is threatening to overwhelm electric grids, but what if they could be part of the solution? I chat with Jeff Bladen of Verrus, a company designing data centers to be "good grid citizens" from the ground up. We discuss how their novel architecture, combining large-scale batteries with a more efficient internal power network, provides flexibility that helps utilities and allows more compute to be built with less grid impact. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I chat with fellow energy nerd-turned-ag-reporter Michael Grunwald about agriculture’s climate impact. We explore the folly of biofuels, the promise of meat alternatives, and the central importance of increasing yields. While we can imagine a future of energy abundance, land is a zero-sum game — no one’s making more — so the choices here are uniquely difficult and important. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I'm joined by two of California's leading housing champions, Assemblymember Buffy Wicks and Senator Scott Wiener, to discuss their bills to reform the state's notorious environmental review law, CEQA. We explore how a well-intentioned 1970s environmental protection has become a tool for NIMBYs, unions, and even oil companies to delay or kill housing projects — and why the politics have finally shifted enough to make progress possible. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Rep. Mike Levin and I discuss the “Big Beautiful Bill” that raises energy bills, kills 830,000 jobs, and gifts China the next industrial revolution. We unpack the fossil-fuel cash behind the carnage, the paradox of red districts cutting their own subsidies, and the optimistic playbook — centered on transmission and real climate economics — for the next Democratic majority. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Washington state just passed one of the strongest transit-oriented development bills in the nation, and in this episode, I talk with Rep. Julia Reed and Alex Brennan from Futurewise about how they got it done. We discuss why building more housing near transit is so important, what this landmark legislation entails for density and affordability, and how it positions Washington as a leader in pro-housing reform. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

On June 4, at a Canary Media event in Washington, DC, I sat down with Senator Martin Heinrich to dissect the GOP’s so-called “Big Beautiful Bill” — a sledgehammer aimed at the Inflation Reduction Act, public-lands protections, and US science. We talk about the handful of Republican votes that could still save key tax credits, why bipartisan permitting reform isn’t dead yet, and how the bill’s self-inflicted grid squeeze would jack up energy prices right when AI is poised to spike demand. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I'm digging into the surprisingly overlooked world of electric motors with Ankit Somani of Conifer, a startup aiming to revolutionize these unsung workhorses of the energy system. We explore their ambitious approach to making motors lighter, more efficient, and cheaper to build, all while ditching problematic rare-earth magnets. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I talk with Taylor Krause, who went from working on hydrogen policy at RMI to finding a quantum physicist husband and unexpected fame on Netflix's Love Is Blind. We unpack her surreal journey from clean-energy wonk to popular influencer and how she's navigating using her newfound influence. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I chat with Johanna Wolfson, co-founder of Azolla Ventures, about their unique philanthropic-backed VC model tackling the tough problem of sustainable mining for the clean energy transition. We explore the promising tech Azolla is backing to reduce mining's impact, from using electrochemistry to refine copper without dirty smelting to advanced techniques for processing low-grade ores and even waste. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

This is a free preview of a paid episode. To hear more, visit www.volts.wtfThis week on "What the F is Happening" (periodic episodes in which we reluctantly discuss current events) we talk with Adrian Deveny, a former Senate aide who was in the trenches for the IRA's creation, about the House GOP's "Big Beautiful Bill." In its current form, it amounts to wholesale destruction of the last four years of climate policy. We ponder the bill's chances of becoming less catastrophic in the Senate amid the lack of meaningful pushback from the industries being kneecapped and the predictable folding of "moderate" Republican opposition.

In this episode, I talk with Catie Gould and Alan Durning of the Sightline Institute about the "dark matter" of urban land use: parking — specifically, the municipal parking mandates that help make housing more expensive and scarce. We discuss a landmark new parking reform bill in my home state of Washington, what it does and the coalition that made it possible, and point to other places where parking reform is coming soon. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

This week, I chat with Dawn Weisz of MCE Clean Energy about the nitty-gritty of community choice aggregation, where local governments take control of their electricity procurement. We get into issues like navigating utility obstruction, the complexities of rising grid costs they don't control, and their push for smarter, more autonomous regulation. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I sit down with Page Crahan, who leads Tapestry, an audacious effort to “make the grid visible.” We explore how disparate, scattered data sources can be stitched together by AI into a coherent realtime map of the grid, to slash operation and maintenance costs and speed up the grid interconnection process. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I’m joined by Marissa Hummon, whose team partnered with NVIDIA to tuck a credit-card-sized GPU computer with AI software into the humble electricity meter. We discuss how that edge computing digests 32,000 waveform samples per second, spots failing transformers, and orchestrates VPPs — plus the guardrails that keep it from becoming Skynet. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

The hype about hydrogen is back with a vengeance, and thus, so is Joe Romm, who just issued a revised and updated version of his 2003 book The Hype About Hydrogen. We discuss the persistent economic and technical hurdles that make widespread hydrogen adoption unrealistic, explain why most applications are better served by direct electrification, and scrutinize the massive investments and motivations behind the current hydrogen push. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I chat with Kathy Hannun of Dandelion Energy about ground-source heat pumps, which are twice as efficient as air-source units but still more expensive up front. Dandelion has designed its own drills and heat pumps, and with a new 1,500-home partnership with a developer in Colorado, it’s looking to scale up and bring costs down. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I’m joined by consultant Jarrett Walker to take the pulse of US transit in a world of empty downtown office towers, surging weekend ridership, and the tech elite’s dream of transit without strangers. We unpack the myths that plague buses, reveal why Canada’s transit abundance should be our model, and map the policy battles that will determine whether US transit systems shrink or soar. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

I catch up with Span CEO Arch Rao to discuss the company's expansion from consumer panels to the utility-focused Span Edge which can be used to create a true distributed power plant. We discuss why this is key to accelerating electrification and examine how the system works to respect consumer choices while managing grid constraints. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I speak with Illinois Governor JB Pritzker, one of the depressingly few Democratic leaders showing real fight in the face of Trumpism. We get into the weeds on how Illinois is defending its climate laws, advancing clean energy and manufacturing, and tackling thorny challenges like the housing crisis, the transition away from natural gas, and the looming “fiscal cliff” facing transit agencies. Oh, and the governor explains what quantum computing is. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, the tables are turned: I'm the guest of the Climate Papa podcast, interviewed by host Ben Eidelson. We discuss the nested fractal puzzle of decarbonization, the critical importance of the grid and urban land use, and why now is the most exciting time to jump into climate work. Plus, I share some thoughts on parenting and avoiding tech-bro culture as the climate space evolves. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

My guest, Val Miftakhov of ZeroAvia, argues that hydrogen fuel cells paired with electric motors are the key to decarbonizing aviation. We discuss why he prefers his solution to sustainable aviation fuels or batteries, the challenges and misconceptions around supplying and refueling with hydrogen, and the tech roadmap from today's small retrofits to tomorrow's large jets. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

This is a free preview of a paid episode. To hear more, visit www.volts.wtfI talk to Emily Pontecorvo (Heatmap) and Jeff St. John (Canary Media) to grapple with the latest Trump administration moves impacting climate and energy policy. We discuss the executive orders targeting state climate programs and propping up coal plants, the baffling new tariffs threatening energy supply chains, and the flurry of lawsuits challenging the administration's actions.

In this episode, I dive into the UK's decarbonization journey with Lucy Yu of the Centre for Net Zero. We discuss how the UK has become a world leader in offshore wind while lagging in heat pump adoption, why electricity market reform is essential to prevent gas from setting electricity prices, and how community ownership models overcome NIMBY resistance to wind projects. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

I'm joined by “Texas Doug” Lewin to unpack the fascinating contradictions of a state that inadvertently became the nation's renewable energy powerhouse through a free market electricity system that its politicians now seem bent on strangling. Bills before the legislature would require solar and wind developers to also build gas plants, impose extreme setback requirements only on renewables, and potentially cripple the state's economy just as data centers drive unprecedented demand growth. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I'm joined by Helena Sarén to discover how Finland achieved a nearly 95% carbon-neutral electricity mix and set the ambitious goal of carbon neutrality by 2035. We dig into the country's pragmatic approach to nuclear power, how its relationship with neighboring Russia has shaped its energy independence and security strategies, and how Finnish industry is actively pushing for more aggressive climate targets rather than resisting them. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I dig into the just-released Global Electricity Review from the think tank Ember, with founder Bryony Worthington and lead author Nicolas Fulghum. Clean electricity surpassed 40 percent of global generation in 2024, driven by record solar deployment. We explore solar's rapid doubling, the pace of demand growth, and the way China's clean energy decisions shape global trends. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I talk with Antoine Vagneur-Jones, head of clean energy, trade, and supply chains for BloombergNEF, about the messy world of global clean energy supply chains. We explore China's manufacturing dominance, the faltering quest to "onshore" production in Western countries, and why blanket tariffs often undermine the very goals they're supposed to achieve. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I sit down with my old friend Sean Casten for a frank insider's take on the precarious state of clean energy policy amid our ongoing constitutional meltdown. We dive into the political knife fight over IRA tax credits (some Republicans support them), why transmission reform remains frustratingly partisan despite economic logic, and the fossil industry's fear of competition. Despite the dire political landscape, Casten makes a compelling case for why clean energy developers should keep building through the storm. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

This is a free preview of a paid episode. To hear more, visit www.volts.wtfIn this month's mailbag, I rave about my new EV (despite my lifelong aversion to cars), explain why our political system would never permit a "decarbonization Trump", wrestle with solar geoengineering, and share my thoughts on why home batteries are so much pricier than the ones rolling around in our cars.

In this episode, I talk with Patrick Robbins of Public Power NY and Johanna Bozuwa of the Climate and Community Institute about New York's groundbreaking Build Public Renewables Act, which empowers the state's public utility to build clean energy at scale. We explore how this surprising legislative victory happened, the challenges of implementation, and why public ownership might be the key to making renewable energy both politically resilient and economically accessible. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I'm joined by Toms Lumsden and Young (development manager and urban planner, respectively) to explore Blatchford, an ambitious sustainable community being built on the grounds of a former municipal airport in Edmonton, Alberta (Canada’s most conservative province). We dig into how this city-led, mixed-use development is creating a carbon-neutral community with pedestrian-first streets, a variety of housing forms, and a district energy system, right in the heart of oil country. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I talk with Devrim Celal from Kraken about ensuring all our smart home energy devices can actually talk to the grid. We discuss how Mercury will certify devices to create reliability standards, preventing your fancy EV charger or heat pump from becoming useless if a manufacturer disappears while helping utilities manage load growth. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Harvard Law's Eliza Martin and Ari Peskoe join me to unpack how data centers' skyrocketing electricity demand could leave ordinary customers subsidizing Big Tech's power bills. Most chilling is the potential alliance between utilities and tech giants that threatens to derail much-needed utility reforms while entrenching fossil-fueled infrastructure. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Why are housing and urban land use so central to climate policy? In this episode, I try to answer the question squarely, in dialogue with Matthew Lewis of California YIMBY. We discuss why EVs alone can't decarbonize transportation fast enough, how the climate-driven insurance crisis will bankrupt states, why the climate movement’s own internal NIMBYs are its greatest impediment, and when green philanthropists and leaders will finally catch up. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I'm joined by Albert Gore to discuss the fate of the electric-vehicle tax credits under the Trump administration. Gore explains how the consumer credit provides a demand-side signal to complement the supply-side manufacturing credits, and why eliminating either would primarily benefit Chinese manufacturers. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

This is a free preview of a paid episode. To hear more, visit www.volts.wtfIn this episode, I speak with Canary Media journalists Clare Fieseler and Julian Spector to assess the early impacts of Trump's executive orders on clean energy. We explore what's actually happening with offshore wind projects, manufacturing investments, and tax credits from the Inflation Reduction Act.

In this episode, I speak with Mustafa Amjad and Waqas Moosa about Pakistan's extraordinary solar boom -- nearly 30 gigawatts of panels have flooded into the country since 2020! We explore how punishingly high grid electricity prices combined with dramatically cheaper Chinese solar panels have created a bottom-up energy revolution that could become the blueprint for energy transitions worldwide. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I'm joined by James Van Nostrand. He is the top utility regulator in Massachusetts, the first state to explicitly tell gas utilities to plan their own phase-out. We explore this complex transition, including the fate of existing gas infrastructure, the potential of networked geothermal as an alternative, and protections for both workers and ratepayers. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode I'm joined by Annemarie Gray and Felicity Maxwell to discuss how the YIMBY movement is finally cracking the code on housing reform in major American cities. We examine the recent groundbreaking victories in New York City and Austin, exploring how pro-housing groups are learning from each other through networks like Welcoming Neighbors Network, and wrestle with the challenge of increasing housing supply while protecting existing communities. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

At this live event in Austin, Texas, I was joined by Austin Energy executives Lisa Martin and Michael Enger to discuss how a progressive municipal utility charts a course to clean energy in Texas. We explore their multi-pronged approach to reaching 100 percent carbon-free electricity by 2035, from expanding distributed energy resources and battery storage to piloting first-of-its-kind geothermal technology. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, recorded at a live event in Houston, I catch up with Tim Latimer, the CEO of Fervo Energy. Since the last time I interviewed him, almost two years ago, the company has proven out its technology, reduced its costs, started construction on a large-scale commercial power plant in Utah, and signed contracts for many more. We discuss enhanced geothermal’s benefits, its momentum, and its bipartisan support. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I talk with climate scientist Zeke Hausfather about how enhanced rock weathering (ERW) turbocharges a natural process to permanently store CO₂. We dig into how it profits from existing infrastructure, and the big questions around measuring and verifying the carbon captured. Zeke also explains why farmers might actually benefit from spreading all those rocks — and why ERW could become a key, if limited, piece of the broader climate puzzle. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I speak with Harry Krejsa of Carnegie Mellon about why cybersecurity experts and clean energy advocates need to work together. Drawing from his White House experience, Krejsa explains how a modernized clean energy grid could actually help defend against China's cyberthreats — for the benefit of both peaceniks and natsec hawks. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Chris Hayes — author, MSNBC host, and previous guest on Volts — is just out with a new book, The Sirens Call, about the corrosive effects of the modern attention economy. In this episode, he and I dive deep into attention: what it is, when it became commodified, why it is so easy to steal, where industry is looking for new supplies, and how the harried and distracted can defend themselves from the onslaught. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I talk with Erik Steimle of Rye Development about the new wave of "closed loop" pumped-hydro storage projects. Unlike traditional systems that rely on rivers and dams, these projects use two artificial reservoirs — providing reliable long-duration storage without impacting natural waterways. We explore the economics of these billion-dollar facilities, their 100+ year lifespans, and how they compare to lithium-ion storage. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

I'm joined by Eric Gimon to discuss "energy parks" — essentially large-scale microgrids that combine renewable generation, storage, and industrial loads behind a single grid connection. We explore how this model could accelerate clean energy deployment while creating new economic opportunities, despite some complex regulatory hurdles. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I talk with Matt Traldi, co-founder of Greenlight America, about the fight for clean energy at the local level. We discuss how small groups of opponents are successfully blocking renewable projects across the country, and how his organization is working to turn the tide by mobilizing local supporters and giving them the tools to advocate effectively at critical government meetings. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I revisit thermal energy networks with HEET's Zeyneb Magavi and Eversource's Eric Bosworth. What was once a novel concept - replacing gas networks with shared ground-source heat pumps - is now being piloted across the country. We explore the technology's remarkable efficiency and its potential to revolutionize heating and cooling — and give gas utilities a second life as thermal utilities. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I speak with Ben Brown, CEO of Renew Home, about the company's groundbreaking 1-gigawatt virtual power plant deal with NRG Energy in Texas. It will be the nation’s largest VPP, leveraging existing smart thermostats to control millions of residential HVAC systems. We discuss customer experience, data privacy, and the ability of VPPs to rapidly scale to meet rising electricity demand. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I speak with Pier LaFarge, CEO of Sparkfund, who challenges the traditional antagonism between utilities and distributed energy advocates. While investor-owned utilities have long been seen as obstacles to clean energy adoption, LaFarge argues that they're actually essential to scaling DERs in an era of explosive electricity demand. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I speak with Malcolm Woolf and Connor Nelson about hydropower's underappreciated role in America's clean energy landscape. While providing most of our energy storage and thus supporting solar and wind deployments, hydropower faces significant challenges, with a decade-long relicensing processes and inadequate market compensation. We discuss why preserving and expanding this reliable, clean firm energy source is crucial as we transition to renewables. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I chat with author Cory Doctorow about "enshittification," his viral term for how digital platforms and smart technologies inevitably get worse over time. We explore how monopoly power, aggressive IP protections, and lax privacy law enable companies to capture and exploit users — and what that might mean for the clean energy transition as our homes and vehicles become increasingly software-dependent. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I talk with Kate Gordon, CEO of California Forward, about how climate change is breaking the insurance industry. We discuss why insurers are fleeing high-risk states, the limitations of government backstops, and the looming political and financial crisis as communities face hard choices about where people can safely live. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I talk with Caroline Spears of Climate Cabinet about the results of the state and local climate races her organization tracked in 2024. We discuss the importance of these often-overlooked state and local races for climate progress, the challenges of the current political information environment, and Climate Cabinet's strategy for building power at the state level through 2030 and beyond. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I talk with Ray Minjares of ICCT and Jacqueline Torres of Forum Mobility about the electrification of heavy trucks, from drayage at ports to long-haul big rigs. We dig into charging challenges, innovative financing models, and the massive pollution cuts possible by transitioning fleets. Electric trucks are here — but they need the right policies and partnerships to scale. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I talk with activist, sex advice columnist, and progressive journalist Dan Savage about the legacy of “The Urban Archipelago,” a groundbreaking piece he commissioned and edited two decades ago in the wake of GW Bush’s reelection, urging Democrats to embrace cities as their political base and future. We explore how NIMBY-captured Democratic city leadership has stifled urban potential — and why improving and growing cities isn’t just policy; it’s party building. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I chat with Sunrun CEO Mary Powell about how residential solar is evolving into much more than just panels. We dive into Sunrun’s expansion as a “clean energy lifestyle” brand, Mary’s belief in a customer-led energy transition, and alternatives to the tech bros' virile obsession with nuclear power. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I talk with Bill Moyer, founder of the Reconnect America campaign, about the huge, untapped potential of U.S. railroads to support the clean energy transition. Bill makes the case that our privately owned rail system, focused on short-term profits, is missing out on big public benefits—like shifting freight from roads to rails, reducing emissions, and even using rail corridors to carry high-voltage transmission lines for renewable energy. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I chat with Ari Matusiak, co-founder and head of Rewiring America, which recently received a $2 billion grant from the feds to take home electrification mainstream. We dig into the practical challenges — getting local contractors on board, simplifying rebate access — and the enormous opportunities. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, we’re diving into the wonky but vital topic of performance-based utility regulation (PBR) with Cara Goldenberg and Laura Gonzalez. We discuss how traditional utility regulation creates perverse incentives for utilities — and the tools PBR offers to better align incentives with modern priorities to like resilience, equity, and decarbonization. Dozens of states have adopted some form of PBR or other, and Virginia might be next. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I sit down with Dr. Vanessa Chan, DOE’s Chief Commercialization Officer, to discuss the challenges of commercializing new clean energy technologies. Her office has helped develop a common vocabulary among stakeholders (“adoption readiness levels”) and concentrated the attention of public and private capital on certain key technologies (“pathway to liftoff” reports). It’s wonky stuff, but it has transformed and turbocharged DOE’s commercialization efforts. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Ylenia Aguilar joins me to discuss her candidacy for the Arizona Corporation Commission. We examine the ACC’s history of rubber stamping rate hikes, dismantling renewable energy initiatives, and generally pandering to utilities. Three ACC seats are up for election this year and the outcomes could have a profound impact on the state's energy future. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I sit down with Allison Clements, former FERC commissioner, to discuss her time at the commission and the challenges of grid modernization. We dive into the complexities of integrating clean energy, reforms to interconnection queues, and how the commission can take a more active role in the energy transition. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I explore the controversial Texas Railroad Commission with Virginia Palacios of Commission Shift. We discuss the commission's history, its misleading name, its cozy relationship with the oil & gas industry it's meant to oversee, and its role before and after the devastating Winter Storm Uri, where lax regulation contributed to widespread power outages and deaths. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I explore the political landscape of Pennsylvania with state Rep. Leanne Krueger. We discuss the state's nail-biting elections, the outsized political influence of fracking, and the uphill battle for clean energy legislation in a divided legislature. Krueger provides a boots-on-the-ground perspective on climate and energy politics in this key swing state. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I geek out with David Goldstein, founder of Hydronic Shell Technologies, about a novel building retrofit technology that wraps old multifamily structures in insulated panels with built-in HVAC systems. Goldstein's approach allows for energy-efficient upgrades without interior disruption, potentially solving a major challenge in building decarbonization. We dive into how the system combines exterior insulation, air sealing, and centralized heat pumps with individual window units to dramatically reduce energy demand and emissions. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, we explore the Biden administration's ambitious industrial investment strategy with Heather Boushey, a member of the President's Council of Economic Advisors and chief economist for his Invest in America Cabinet. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

California homeowners face a complex puzzle in decarbonizing their homes: electrification without rooftop solar could increase bills due to expensive electricity, while installing solar first risks oversizing or underutilizing the system. Balto Energy, a startup founded by James Quazi, uses AI to analyze utility bills and recommend the most cost-effective clean energy strategy. In this episode, we discuss Balto's tool, its potential to empower contractors, and what California's situation reveals about the future of clean energy policy nationwide.(PDF transcript)(Active transcript)Text transcript:David RobertsHello everyone. This is Volts for September 13, 2024, "A tool that enables solar first home electrification." I'm your host, David Roberts. Californians who want to decarbonize their homes face something of a conundrum. If they electrify their cars and appliances without getting rooftop solar, they could end up paying higher overall bills thanks to California's notoriously expensive electricity and cheap natural gas. If they install rooftop solar before electrifying their cars and appliances, they could either undersize the system for their eventual needs or oversize it and over-produce and export solar power to the California grid. Thanks to California's recent NEM 3.0 decision on rooftop solar compensation, utilities pay much less for that exported rooftop solar power than they used to.The most economical strategy for most homeowners is likely to be some mix of electrification, batteries, and rooftop solar. The more a California homeowner stores and consumes their own cheap rooftop solar power, the more value they get out of that solar and the lower their total bills. It is a complex calculation, though, that most homeowners are in no position to make. That's where the startup Balto Energy comes in. Founder James Quazi, a longtime energy modeler and entrepreneur, has built a tool that can use a home's utility bills to create a model of its consumption patterns, predict what they will be as appliances are electrified, and recommend the maximally economical approach.It's part of a larger effort to help contractors and solar companies navigate a post-net-metering world. I'm excited to talk to Quazi about why his tool is needed and how it works, how it will empower contractors, and what California's present says about the future of clean energy policy in the rest of the country.With no further ado, James Quazi, welcome to Volts. Thank you so much for coming.James QuaziThank you for having me. That was a great intro.David RobertsThanks. So, you know, I sort of went over it a little quickly in the intro there. But let's talk a little bit about this conundrum for Californians who are trying to decarbonize. So, just by background — I don't even know if everyone's been following the California rooftop solar wars, I kind of assume everybody has — but just by way of background, California recently basically issued a new policy on rooftop solar, and the long and short of it is that they're going to compensate homeowners much less. It used to be that basically you could get paid the retail rate for your excess solar, and now they're just going to pay much, much less than that.On the surface, this really damages the economical case for solar for homeowners, they'll get compensated much less. This has resulted in a huge blow to the solar industry in California. There are solar companies shutting down, jobs being lost, etcetera, etcetera. So, talk a little bit about the conundrum and how you think about solving it.James QuaziYeah, so about a year ago, the net energy metering policy in California changed from NEM 2.0 to NEM 3.0, now called Net Billing Tariff. The difference is, as you mentioned, that now customers get paid on a schedule. Each hour per year is a different rate. But generally, you can think of it as between like $0.05 and $0.08 for exported energy, while imported energy for me in San Diego is between $0.38 and $0.52 an hour. So it degrades the value proposition for residential solar for a homeowner. For contractors, it's also proven really difficult. So in the past, it was really easy to have rule of thumb sizing or heuristics, or if you took annual energy over the last twelve months and you designed a system that produced around that same amount of energy, it was generally going to be a good value proposition for the homeowner.But now, what you need to understand is, like, how much of that solar production is actually coincident with the load on the house, because the export of energy is devalued.David RobertsRight. So, the economics now have shifted to make it so that, I mean, maybe this was true already, but more true now that the ideal thing for Californians with rooftop solar to do is to consume as much of the generated power as conceivably possible.James QuaziThat's absolutely correct. So, if you can think of it as, and I'm sure your listeners are familiar with the terminology, like LCOE. So, the cost of solar, residential rooftop solar, is somewhere between, let's say, $0.10 and $0.12 a kilowatt-hour to produce, whereas the retail rate is much higher depending on the IOU that you're a part of. To the extent that you can consume cheap on-site electricity, you are hugely benefited as a customer.David RobertsRight. So then the question becomes, well, there's a bunch of different ways of approaching this question, but from this sort of like, if I'm trying to sell solar, right, I need a little bit of a new pitch, right? Because before, with full retail compensation, it's kind of a no-brainer, you could make a lot of money, but now you can make a lot less money. So this changes the value proposition for solar. So, explain exactly how the sort of calculation shifts.James QuaziSure, I would actually reframe it a little bit in terms of, like, I believe so in the previous net metering paradigm. We often saw simple solar paybacks in the five to seven years. I believe that those paybacks are still available to homeowners, but it's just a different set of products and services than simply rooftop solar on the roof. So, I think our goal is to help retool the solar industries, to help look at a house as a whole, maybe converting a lot of the energy on site that we previously ignored, whether that's natural gas or gasoline, and then power that all with cheap onsite renewables, and that will drive the value proposition for that homeowner.David RobertsRight. It's still worthwhile getting solar, even maybe still a comparable payoff period, but a different approach. And basically, it's going to be a little bit more of a complicated approach. Right? Like, it's one thing just to stick solar on the roof. Like, how much energy do I use, let's stick that much solar on the roof. Pretty easy. Once you bring in the whole home, just the combinatorial, you know what I mean? Just the calculations get a lot more complicated.James QuaziFor sure. So, like, I think in two respects. One, it's more complicated for the contractor to feel confident in the system that they're proposing and the financial outcome for the homeowner. And then two, from a homeowner's perspective, it's more complicated to understand and digest and comprehend a suite of services that might include solar and a battery and a heat pump and an EV, than it is simply like panels on a roof. Our goal at Balto Energy is to sort of do the modeling and ingest the complexity and then deliver it in a way that's consumable for both a contractor and a homeowner.David RobertsRight. So, talk briefly about what your tool does. What is the outcome supposed to be? What is it trying to accomplish?James QuaziYeah, so our perspective on it is that oftentimes in the past, if you asked for a solar quote, you would get maybe one option, two options, or three options, max. Really, like, if I take my own house as an example, so I live in San Diego, I can fit up to 30 panels on the roof, which is constrained by roof geometry, area shading, what have you. So let's call it maybe 20 to 30 different flavors of solar systems that I could possibly engage in. If I layer on batteries, I could have 1, 2, 3, 4 batteries. And then EVs, one or two EVs, and heat pump or not heat pump, water heater or not water heater.And our first step in the process is to ingest an address and then interval bill data. So, we need hourly electric reads and daily gas.David RobertsAnd that, just to be clear, this is the sort of raw information that's going into the model?James QuaziYeah, that's correct.David RobertsIt's utility bills. And this, these are available from the utility. There's no, it's not difficult to get this information.James QuaziSomewhat loaded question. It should be available. I just finished listening to your podcast on "Free the energy data." I have —David RobertsThat's why I ask. I'm wondering how straightforward it is to get the raw data that you need.James QuaziI would say that having been in this industry for 20 years, it's much easier now than it has ever been before. That being the case, there are still hurdles. There's a lot of missing intervals. There's patchwork to be done. There are services that provide synthetic intervals. It's not as clean of a dataset as I would ideally like, but it's generally like the authorization, and there are a couple of third-party companies now that do it and are making it easier.David RobertsIs it notably easier in California than it is in other states? Different in California than in other states? Or is this just a utility by utility thing across the country?James QuaziOur focus is in California right now. So, I have the most depth and experience there for this problem. Even within California and the IOUs, it is utility by utility.David RobertsSo are you restricted geographically where you can sell your product based on the utilities, whether you can get these to utility information or not?James QuaziOur position is that to accurately model a home's energy use and consumption profiles, you need two things. One is you need a physics-based model of the building, and then you need to be able to calibrate that with what is actually happening in the home. I've done a lot of energy modeling, auditing, that sort of thing. I think the one definitive thing that I've learned is that the best site observed data is actually bills. It will help you ferret out how people use their home, what their preferences are, and is actually the ground truth data.So, our position as a company is because we want to be able to confidently project — like, let's say if I converted a gas furnace to a heat pump, and I want to know on an hourly basis, what is the energy input to that system. To do that accurately, I believe that you need interval data.David RobertsSo you are in some sense beholden to utilities here or dependent on utilities to be forthcoming?James QuaziYeah, I think, unfortunately. And then to "Free the energy data" podcast. Yes, this is true, and it is being in some ways held hostage, and that's not great for the industry. I would say that our success rate right now is like, it's significant enough that we see this as somewhat of a hurdle, but not a deal breaker.David RobertsRight, right. So, I mean, getting utility bills seems straightforward enough. You just ask the homeowner and they give them to you. But when you say a physics-based model of the house, you have to go do that in person. Can you construct that from publicly available data?James QuaziYes, you can. We've done this in several iterations in the past. So, the background engine that does this is an NREL product called EnergyPlus. And it has, let's say, a full set of data requirements, which you can imagine has a lot of physical attributes of the specific house. And what we do ourselves and through partners, is comb, let's say, permit record databases and MLS listings. And we can get close enough with that set of information to build the first model. And then it's really, in comparing that model to the billing data, what's actually happening on an hourly basis, that allows us to calibrate it.David RobertsInteresting. So, you don't have to do a site visit to do any of this, really. You could theoretically do all of this modeling remotely?James QuaziYep. Everything like roof geometry, shading, building modeling, tariff engines, all the things that are sort of the processes to get to an output, can be done remotely.David RobertsAll right. And so, you put all this information into the model, and then what is the model supposed to do? And here's a question I had also: Am I the homeowner, interacting with this model in any way, or is the model a tool for contractors?James QuaziOur plan, at the very start, we're working with a set of contractors, and we're in Napa and Sonoma to start, most notably Northern Pacific. Our plan is to deliver a tool to a solar contractor that they can use to propose a wide range of solutions that a homeowner might want. I think that this will become a customer-facing tool or exploratory tool in the future, but we are definitely starting with solar contractors.David RobertsInteresting. Yeah, because one of the questions I had about this is just that I'm sure I'm not telling you anything as someone who's worked in energy for a long time, but just like, people are pretty lazy, and the way people make decisions about appliances and stuff like that is generally to ignore it until it breaks and then go to Home Depot. So, like this comprehensive, long-term, holistic planning, I'm just like, wondering, like, how many homeowners are really that committed?James QuaziSo, let me give you an idea of, like, what the output of the tool is, then where I see this going. So, you know, back to my house, 30 panels, batteries, EV's, all the things. What we want to do is expand the solution set for all possible outcomes for that house. So, if I permutate those things, it ends up being a set of maybe like a couple hundred to a thousand different individual pathways. It could be 28 panels —David RobertsAnd these are like mixes of the number of panels, the number of batteries, what kind of appliances, that kind of thing.James QuaziThat's absolutely correct. And then what we've created is sort of a decision-making framework that allows you to search that space for the thing that's right for you. At first, contextualized in one of three goal seeks. So the first one being a very standard solar approach, which is "Deliver me the best financial outcome." The second one, which we're seeing a sort of increasing adoption around, is like, "Yeah, I want a great financial outcome, but I also want to power this set of critical loads or my entire house through an outage of this duration. And I'm not cost-sensitive around that."So, like, if I need to add a battery or two batteries and it provides that service, that's fine. And then the third one is a sort of immersion. Ten years ago, when I was in the solar industry, it was like there was a time when we thought we had to deliver day one savings to get adoption. And it turned out there was a segment of the population, mostly retirees or people that were about to retire, who, let's say, had a $150 utility bill. And they're like, "You know, saving money isn't as important to me as, you know, I experienced the grid cost is volatile, but always volatile in the upward direction.And if you are going to put on the system and it has a 20-year lifespan, can you lock in this $150 for 20 years? And I don't experience any increase in costs." So those are starting points. I will say that I think there's more out there. So, there are a segment of customers that could be interested in just like the environmental outcome, and there's ways to calculate that based on grid dynamics. That's where we're starting, and I think we'll kind of learn our way into the solution.David RobertsRight, so you can tweak the model depending on what your goals are, depending on what your aims are. And I guess one of the questions I had about it is, like, in California at least, grid electricity is so expensive and natural gas is so cheap, and solar compensation is now so low, that it seems like the most economical outcome for homeowners is always going to be to electrify all your appliances and put a bunch of rooftop solar to power your appliances. It seems like that's always going to be the cheapest outcome, is it not? And that's also always going to be the most environmentally preferable outcome, right?Because it's zero carbon. In other words, what if I, as a contractor, just came to you and said, "Look, I can do all these complicated calculations, but trust me, you want to electrify all your appliances and put rooftop solar on your roof. That's what it's going to end up showing you." Does it ever show otherwise?James QuaziSo, if we were to implement generalized or rules of thumb, I think that would be a good one. What I have seen is there are time when your're roof constrained, so you might not have the roof capacity to power all the things, and then you'd want to make better decisions. To the extent that you have vast plains of south-facing, west-facing roof area, we want to make sure that we're installing the right amount of solar and batteries. So, I think that there's an optimization problem there. But, I think you're right in the sense that to the extent that you can self-consume a ton of energy that you generated on-site, that will be the best outcome for you.David RobertsSo then, if I'm a homeowner and I run this model, or a contractor comes to me and runs this model, and the outcome of the model is the most economical approach for you, the homeowner, is to buy a heat pump, buy a heat pump water heater, buy an induction stove, et cetera, buy a bunch of batteries and put a bunch of rooftop solar on the roof. On the one hand, I might believe, I might find it perfectly plausible that that is the end state that will yield the lowest ongoing operating costs for my house. But on the other hand, that's a daunting upfront investment. Do you know what I mean?In a sense, if I'm a homeowner and a contractor comes to me, he's like, "I'm selling solar. And by the way, I have this fancy tool that shows me that you also need to buy a bunch of other stuff from me." I guess I'm just a little suspicious.James QuaziI think the intent of the tool is to allow a homeowner to make the best decision for them. To the extent that the best decision is, in fact, a larger PV system, more batteries, maybe a heat pump, and all of those things in aggregate end up being expensive directionally , but have great payback. I think that hits on like sort of the second vein of Balto. So the first is like, how do we create a decision framework and compute engine to give you the scenarios and help you make a decision? Once you've made a decision —David RobertsWill the model also crank out a preferred order of operations for that? You know what I mean? Not just like an end state that would be best, but like, what steps in what order are economical?James QuaziThis is getting back to the solar-led electrification vision for this. Our position is that solar and storage should lead always , and we should be building 20 or 25-year products for the future energy consumption. The tool is there to say, can we share a vision of the future and what applies and things you'll be engaged in, whether that's EVs or heat pumps or whatever. Once we have that, can we build 25-year renewable infrastructure on site to support those things over time? We think that there are interesting ways. And I'll touch on the financing in a little bit about how to transact this and make it consistent.David RobertsYeah, I want to get to the financing in a minute, but before I leave this question. So, why always solar and batteries first? Or put it this way, why shouldn't I put a little bit of solar and batteries on, enough to power my current appliances? And then, you know, when I switch out my furnace for a heat pump, just stick a couple more solar panels on the roof. Why not do it incrementally like that?James QuaziYes, I myself have a background, and then we've got some deep partnerships with contractors. They are not a fan of that approach for a number of reasons. One is if I take a five-kilowatt system and then I append a three-kilowatt system on later, that is not the cost of an eight-kilowatt system. It's much more costly.David RobertsBecause just coming out to the site again and all—James QuaziRedesign, permitting. Yeah, all the things. And then separately, depending on the time lag between system one and system two, there are at times, compatibility issues with modules that make it more difficult. I think solar's gotten inexpensive enough where if you were going to engage in one of maybe the three big electrification projects, which would be EV, heat pump, heat pump water heater, I mean, you should be sizing for at bare minimum that. And I would argue for the whole thing if that's what you intend to do, on day one. And then if you're doing other things, let's say that have a more de minimis impact on your meter or your electrical consumption, like a stove, then maybe it's fine to wait.But to the extent that, like, you're considering solar and storage and one of the other things, I think it makes a lot of sense to size appropriately for future loads.David RobertsSo, you would say to any homeowner contemplating solar that the financially smartest thing to do is to size a system for your projected total need in the future, not your current need.James QuaziYeah, no, I feel strongly that that is the case. I will take myself as an example again. I have an EV. I am considering a heat pump. I have a tankless hot water heater that is in a closet and is not easily replaceable with a heat pump water heater given form factor. But given those things, I did size the PV to the anticipated heat pump. Even if that doesn't happen on day one, it might happen on year one, three, five, or seven, right?David RobertsSo, are you not then, while you have the solar that's oversized for your current needs, are you not sort of financially losing out in the interim, in the meantime?James QuaziSo, I think that again, the export value for solar today directionally is much lower. So, there is some value, it's not a lot. I would categorize it as you're not optimizing the system today.David RobertsSuboptimal, then let's see.James QuaziBut I think that what you're really doing is putting together the infrastructure to adopt more products in the future.David RobertsRight. A contractor comes to me as a homeowner, says, "Let's look at how much solar you will need once you've electrified your home," basically, and install that amount. Do you envision these same contractors who are trying to sell solar, selling these other things to homeowners as well? Sort of like offering, like moving beyond solar to offer kind of total home electrification packages type of things.James QuaziI think there's going to be a couple of different flavors, and we'll see what sorts out. In San Diego, one of the biggest residential installers actually has historically had a heat pump division of their company. That's probably not the norm. I do see a lot of solar installers — I mean, certainly, a solar installer is now installing storage by default. A lot of them install EV chargers. I've seen some interest in heat pump water heaters as the installation is quite a bit easier than heat pumps, HVAC. So, I think that we'll see some adoption of product over time.I do believe that the heat pump is probably the one thing that is a set of expertise that is probably different than what solar providers have in-house. What they can do, and we anticipate doing, is a lot of pre-wiring work. It's taken as an industry axiom that HVAC products get replaced when they break. To the extent that that infrastructure, whether it's a 240 circuit to the existing furnace location, is not in place, it's very likely that the existing thing gets replaced with something very similar, and then we're locked into this pattern for 15 years.So, we're very interested in, again, sizing appropriately, but then also doing some of the pre-work that allows these things to be adopted.David RobertsTrey, interesting. And so, from your perspective, you're going to put the tool in the hands of contractors, and then to some extent, the contractors are going to figure out exactly how best to use it and what kind of packages to offer and stuff like that. Is Balto out being a contractor, like running this, interacting with homeowners?James QuaziNo, we are not. So, what we're doing is providing a toolset, which is computational tools, finance tools that allow existing contractors today to be more effective.David RobertsGot it. And so, talk about the financial side of this. So, I'm guessing I'm borderline illiterate when it comes to money issues. But I'm guessing that part of the promise of this is that if you can more accurately and reliably project future energy needs in a home, you're going to have an easier time financing the sort of oversized solar system that you want in anticipation of those loads. Is that right? Part of this is like giving confidence to financial institutions to finance these things, right?James QuaziYeah, that's exactly right. So, I would say that the first step is having a shared vision of what the future of this home looks like. So, what are the appliances that are on the list and off the list? EVs, whatever the case is. And then, from past learnings at Solar City and Dandelion, really what you have to do is package it in a way that people can experience the savings at the same rate as they chunk off the capital cost of these projects. And then, in terms of energy savings over time and confidence, I think the goal there is, and we could think of it as if you were getting a loan.One factor in the loan might be your debt-to-income ratio. How much debt do you have, and can you actually service this loan over time? And our position is, to the extent that these suite of products actually lowers your obligations to pay, so your utility bills, that should be factored into any financial product as well. Does that make sense?David RobertsYeah. So, it's almost like future income increases, almost like.James QuaziYeah, so if I had, like, if my obligations to pay a loan provider were $1,000 a month, just randomly, and I made x amount of income, if the obligation was less, if it was $500 a month, given all these energy savings, I would have a greater ability to pay back that loan, and that should be factored in.David RobertsOh, I see, I see. So, is the idea here just for this tool you've created to give confidence to homeowners who are going to banks and stuff, or are you getting in the finance game at all?James QuaziOur intention is to provide the financing for it as well. I mean, like, I think any time we're trying to make the process as seamless as possible. So, it's sort of like a one-stop shop in terms of assessing what's right, what's the best fit for you in terms of these projects, and then packaging it in a way that — we're hoping it incentivizes people to do more sooner, but to the extent that they want to do things over time, it is also like a flexible facility that allows you to adopt a heat pump water heater in year three, if that's what you want.David RobertsSo the contractors are the ones offering the homeowners this sort of financing package?James QuaziYep, that's correct.David RobertsRight. And the contractors are able to do it because they have this information from your tool that gives them confidence?James QuaziHand in glove.David RobertsRight. So, just having gone over all this, let's rewind and just imagine I'm a homeowner, and a contractor knocks on my door. What do you envision the contractor sort of like, what is the homeowner facing pitch from the contractor? Because there's a lot of complicated stuff going on behind the scenes for the contractor. What is the homeowner hearing? What is the pitch to the homeowner?James QuaziYeah, we see it as a stepwise process. So, because our go-to market is through solar contractors, the first step is to say, if I were any other solar contractor, and you called me for a solar and potentially storage system, what I would have done is looked at your current electrical bills and size the system this way, and this is what... "You want a five kilowatt solar array and one battery, 110 kilowatt hour battery." The next step is to say, "Hey, listen, we're actually in that world. We're only looking at one of probably three silos of energy that you're using."So, we're ignoring the natural gas side of the bill. We're ignoring everything that's happening at the pump. But, if we look at your energy spend holistically, here are a suite of options that are available to you. And this is the differential sort of financial outcome versus just a solar system, versus, like, resiliency versus bill stability kind of thing.David RobertsSo, the idea here is, I go to the contractor and say, "Hey, I've been thinking about solar and battery," and the contractor says to me, "Well, hey, what about this larger package? You could have even bigger savings, and you could have resilience," and stuff like this. So, it's a little bit like an upsell for a contractor.James QuaziYeah, I mean, I would think of it as like, being able to more holistically address energy spend. Like, that's our goal, is to say, "It's not just one flavor that we're dealing with. We're looking at the entire house and things, and we want the best solution for you."David RobertsIt makes me wonder how long it will be before homeowners think that way, or if they ever will. Because homeowners just think of products as separate products. I don't know that a lot of homeowners, especially outside our world, even sort of think of the home as a system, right? With certain energetic inputs and outputs that should be dealt with as a holistic system. Like, that's just — I'm not even sure homeowners are at all accustomed to thinking that way.James QuaziI wonder if I myself am, like, blinded by sort of a friend group or whatever the case is. But I would say that, like, I don't know of a lot of people that aren't at least considering an EV, right? Even if they're not, like, actively join in. But it's like, "Hey, listen, this is actually a real option." I don't think that heat pumps are very far behind that curve. It's interesting, like when people, like historically, when people inquire about solar, we often times have thought of that as they want bill savings. But I am not entirely sure that that is the reason.David RobertsDo we know? Have we done surveys and polls? I'm so curious. I would also assume, just out of a sort of, I guess, a low, like a background degree of cynicism, that that's going to be the dominant motivation. But is it? Like, I don't feel confident about that at all.James QuaziWell, I don't either. My belief is that bill savings are part of a decision-making process, but probably very rarely the primary driver. And that is the thing. And even if you look at, like, the funnel conversion metrics of, like, the solar industry as a whole, it's just like, for every hundred people that inquire, single-digit people actually do the things. And our perspective is like, you know, they're getting stuck somewhere in the process. And it's oftentimes with questions that cannot be answered, and that's when they stall out. And that is our reason for expanding the set to everything that's possible in your home and letting you search that, because we think we'll figure out what are the motivations. I think that there's a strong cohort of people that are just anti-utility.David RobertsThat's a piece of it. There's an environmental piece of it. There's a sort of independence, anti-utility piece of it. There's a vague mix. There's just social contagion, there's just peer pressure. You see it around you. It's the whole stew of motivations. I'd love to understand that better. So, I mean, it kind of seems like what you'd want is for your tool to be in the hands of everybody involved in any of those products. Do you know what I mean? Like, if I want an EV and I go to the car dealership, you know, it'd be cool if the car dealer could say to me, "Hey, you know, save even more money if you threw in a heat pump with this and a solar panel."You know, like if, or the heat pump, people are like, "Hey, throw in an EV and solar panels." Like, it'd be nice if homeowners confronted the idea of total electrification everywhere they looked, right? I mean, that'd be ideal.James QuaziYeah, 100%. I really think that's the vision, and that's where we're going. I think the entry point into a lot of this stuff will be varied. Like, it will be through an EV at the start, or a broken furnace that gets replaced by a heat pump or whatever the case is. I think our goal is to engage homeowners in a way where we have a persistent bill connection. I think that this is why that episode resonated so much with me. If we have an address and a persistent daily, hourly, monthly, whatever the case is, bill connection, you can drive insights over time to a homeowner at very meaningful times to intercept them.Right now, I think this business, like solar in general, is very transactional. We think of it as like, we get leads in the top of the funnel, we set them at this rate, we convert them at this rate, we install them. It's a 30% gross margin, and then that's the end. Whereas, I don't believe that that's the way the products will be adopted and people will have to, I mean, internally we call it energy literacy. Like, how do I start to understand the problem and the solutions?David RobertsRight. So, in the same way, you sort of have a financial advisor, you could have like a home advisor, basically. A home energy advisor.James QuaziAnd we also think it's got to be low impact, so it can't be like, "Hey, you've got to go do this detailed sort of appliance audit or whatever the case is." So it's bills and address, and then, you know, this is a great state of change problem where utility rates are constantly changing, prices of products are changing, incentives are changing, and there's always a chance to message. I very viscerally feel this in the sense that, like, when I took four years off and then reengaged with the industry, I was like, "Wow, we like, crossed the threshold, like, the point of no return, where electrification now makes sense for everyone," and I had missed it, and this is the only thing I'd ever done.David RobertsYeah, I mean, it's moving so quickly. I will say, though, one thing I hear from, you know, and there's been articles written about this. It's just like, it's all out there from people who have tried to do this total electrification thing. It's just incredibly difficult, just incredibly difficult to synchronize everything and arrange everything. And so, in that context, the idea of having a kind of home advisor where, like, your hot water heater breaks and you just call your home advisor, you figure out, like, what's the right approach here, what's the economical approach, where to look, what kind of thing to get?A lot of people would very much welcome having one of those, I feel like.James QuaziAnd I think that this speaks to the general funnel conversion in the industry, but generally, a lead comes in, and then what we're trying to do is furiously convert them to a sale and install as quickly as possible, hopefully within 30 days, hopefully in one set. And I just don't believe that that's the way that people will consume products. It will be through a bunch of different experiences over time. And I think that's a meaningful difference. Like, you know, we're in such a rush to do all the things. Like, I'm in a rush to do all the things at once, but I think we have to also meet people where they are and, like, engage them in some way over time so they can make a decision, so they can make another decision.David RobertsI hope it changes because, honestly, like, you know, I've thought about solar. Ten years ago, we did one of those sort of, like, online audit things, and it was like, "No, you're too shaded." But I think it's just changed since then. Uh, just like, what's possible. But, like, I know that if I got a solar contractor and sat down at a table with that person, that they would just be sweaty and desperate, you know what I mean? To sell me just like it, exactly like I feel at the auto dealership, which is just like, "Ew," kind of uncomfortable, you know what I mean?And rushed and don't feel like I have a full sense of all the pieces in play, and that I can't trust the person I'm talking to, to help me out, you know what I mean? I'm sort of, like, adversarial. I hate that whole model, you know what I mean? And just like, I would be, I don't know how representative I am, but I'd be inclined to spend more money if I just had a person who was like, had the big picture, had the model, had the data in hand, said, "You know, like whenever you're ready, this is the right first step."Just like a better environment for homeowners to deal with these things and think about these things.James QuaziYeah, no, I get it. I feel very similarly. I totally understand from the other perspective, like solar sales reps are expensive and they're hired to do one thing. I just don't know that it's the way that most people want to adopt the things.David RobertsYeah, I can't believe that it's going to go to truly, truly mass penetration running on this model. It's going to have to evolve into something else. As we near the end here, let's pull the camera back a little bit and talk about the Agile Electrification project. My understanding basically is that the NEM 3.0 decision in California threw the solar contracting world into a bit of a tizzy. And there are efforts now to organize and figure out how to move forward and how to help contractors and what the right approach for contractors is in this new world.So, tell us a little bit about what the Agile Electrification project is.James QuaziIt is an industry-sponsored project that's hosted at the Design and Innovation Center at UCSD. The genesis of it was a lot of, quite honestly, hammering around NEM 3.0. It was like if you read Canary or any of these publications, a lot of it is doom and gloom. This industry is down 70%.David RobertsYeah, there's a lot of "sky is falling" sentiment flying around.James QuaziYeah, I think there have been. And you know, a lot of people are like, "Hey, listen, a lot of the bad actors are going to get flushed out with this," which I believe. I also believe a lot of some good actors will go out of business. So this is like a real issue. In times of turmoil, there's oftentimes opportunity and there's a group of people, contractors, manufacturers, investors, who have come together in this venue where sometimes it would be competitive or driven by business interests and they're coming together to solve problems for the industry. So right now it's a series of three projects to expand from there.One is like energy modeling for the entire state of California. It's something that everyone needs. We want to do it and open source it. Another one that we touched on earlier is understanding customer motivations and understanding where they got stuck and how to unstick them, because our general sense is they want to save money. And I don't know if that's the primary motivation. And then the third one is around incentives and rebates and how to, like, it's a constantly evolving landscape and just staying on top of it is like a challenge and maybe a full-time job.So, it's how to open-source that aspect of it, and how to qualify people for rebates and make sure that they're up to date, make sure they're not over-allocated, and deliver that information to the people on the ground that are actually installing the systems.David RobertsRight. And so, I'm stuck on this point. I just wanted to reiterate one more time. So, it's your belief that, because I think this sort of popular belief is that the NEM 3.0 decision has radically reduced homeowner incentives to get solar power, that it's just not as worth it anymore to get solar power. What you're saying is, with the right holistic approach, solar power is as valuable as ever and just as worth getting as ever. Is that your position?James QuaziThat is my position, yes.David RobertsDo you think that that is widely, like solar contractors believe that, or are you having to sort of buck them up and convince them of that?James QuaziWell, I think we're in a stage right now where, I mean, we set up the simplest possible website, have done very little marketing. We've had directionally 75 to 100 contractors sign up and say they're interested. I believe that the contractors are looking for solutions. For sure. That is definitively true. I think they should believe this because it is true that there is a great value proposition in homeowners. I think the issue here, maybe the persistent issue that's undeniable, is that it's more complex. Describing the value proposition has become more complex. For sure. There's no way around that.So, we're trying to find ways to — I mean, the back-end compute engine is great. The real challenge is finding ways to deliver that information to customers in a way that's actionable.David RobertsFor sure. Final question then. A lot of this seems very Californian. The fears and the solutions and all of it seems sort of very customized to California's current circumstances. How applicable is all of this, do you think, outside of California? Would your model be helpful to a homeowner in, I don't know, like Arkansas?James QuaziYeah. So, I would take it in two flavors. One is, I think there's the expectation, for good reason, that these policies in California will get exported to other states. So, it will become hugely relevant soon.David RobertsYou mean rooftop solar compensation getting cut way back? It's already happened in a couple of other states. I mean, it's definitely a trend.James QuaziYeah. So, that's true. NEM 3.0, or like the difference between export energy valuation and import and parity, does not have to be true for this general value proposition to hold true. So, to that extent, I would say that it's portable anywhere. We chose to start in California because it is by far the biggest solar market. It accounts for about 50% of solar and there was a demonstrated need. I will say that it's a very complex problem to solve and it has geographic sides to it. So, as you move location, utilities change and their tariffs change and the way that they charge and weather changes.David RobertsThe information they make available.James QuaziExactly, exactly. So, we've tactically started it in California for those reasons and constrained it. But there's no reason why this shouldn't be applicable to, like, any other place.David RobertsRight. It's sort of interesting. The big fear, or I guess the thing that solar people used to say to utilities when warning them away from NEM 3.0, is like, "Look, if you cut compensation too much, we're just going to self-consume and then install more electric appliances and then slowly wean ourselves off the grid and then not need the grid anymore. And then you're losing customers." The much-fabled death spiral. It seems like you're organizing to make that real, to make that happen.James QuaziI have some thoughts on this. I really do think, and I don't know the answer, but at some point down the road, we're going to have a fork. That fork will be either we find a way to use essentially distribution resources to cooperate, and I think that is the best societal outcome, or we find that we can't cooperate and everyone has to be their own, like a little micro picogrid, and that we have to build the infrastructure to do it. And, you know, I think that it's probably more likely that that's going to happen, which is unfortunate, but I do think that, as always, the affluent will serve themselves first and make good decisions and the rest of the costs will be pushed on to everyone else. And actually, in my heart of hearts, what I think will happen is we'll find a way to cooperate, but only after we've sort of incurred a huge amount of pain.David RobertsThat sounds like the American approach that I know and love. We'll stumble through some disasters and then eventually get our act together.James QuaziYeah, you end up doing the right thing when you're forced to. So, I think that that's the way I see it happening.David RobertsAll right, well, cool. James, this is really interesting. I've been meaning to look into solar in California, how they're dealing with all this. And this is a really interesting approach. I mean, it's never funny. Until I sort of read about this, it never occurred to me, even though it's really obvious, that like, of course, electrifying your appliances and getting your battery and getting your solar panels are — that's like the same thing. You know what I mean? Like, that's all one. That's all one thing. Like I said, it's like a switch that kind of flips in your mind.You're like, "Oh, like, it's a holistic system." It would be interesting to try to train homeowners to think that way more. Thank you so much, James. Thanks for taking the time.James QuaziThank you. Appreciate it.David RobertsThank you for listening to Volts. It takes a village to make this podcast work. Shout out, especially to my super producer, Kyle McDonald, who makes my guests and I sound smart every week. And it is all supported entirely by listeners like you. So, if you value conversations like this, please consider joining our community of paid subscribers at volts.wtf. Or, leaving a nice review or telling a friend about Volts, or all three. Thanks so much, and I'll see you next time. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Public utility commissions (PUCs) wield enormous influence in the US energy transition — they regulate the monopolistic utilities at the heart of America's electricity system but face little public scrutiny. Now, energy analyst Charles Hua is launching PowerLines, a nonprofit that aims to pull PUCs into the spotlight. In this episode, we discuss the problems with PUCs, opportunities for reform, and the coalition the group aims to organize. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

There has been an epic battle over the past 20 years between two types of lithium-ion batteries: nickel manganese cobalt (NMC) and lithium iron phosphate (LFP). While NMC still boasts better energy density, LFP is making a major comeback thanks to its safer, more accessible materials and improving performance. However, China still dominates the LFP supply chain. In this episode, CEO Vivas Kumar of startup Mitra Chem weighs in on why America needs domestic production of LFP materials. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

The Environmental Voter Project has a unique approach: rather than convincing people to care about climate change, it identifies people who already do, but don't consistently vote, and works to get them to the polls. In this episode, EVP founder Nathaniel Stinnett discusses how to find these voters, keep them engaged, and measure their impact. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Access to charging is a barrier to EV adoption for folks without a driveway or a garage, but what if charging your car in an urban area was as easy as charging your phone? Enter startup Itselectric, which has developed curbside level-2 chargers that connect to building electric panels, making installation quick and efficient. In this episode, co-founder and COO Tiya Gordon discusses the company’s award-winning charger design and vision for a future of ubiquitous urban charging. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Through the passage of IRA and CHIPS, the Biden administration has invested billions of dollars and created more than 100,000 manufacturing jobs in purple and red districts that have been hard-hit by globalization and disinvestment. In this episode, Julian Spector of Canary Media, reporting from these communities, shares about local reactions to this influx of new money and opportunities, and the reality that Trump’s Project 2025 wants to roll back the tax credits fueling this growth. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

After decades of talk about offshore wind, California seems closer than ever to actually supporting an industry. But to meet the state’s goal of five gigawatts of offshore wind power by 2030, a lot of as-yet-nascent pieces need to fall into place. In this episode, Adam Stern of Offshore Wind California and Jocelyn Brown-Saracino of the US Department of Energy discuss California's recent policy efforts and the state of floating-wind technology. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Most electricity ratepayers in the US have a smart meter generating real-time data about their power usage, which could theoretically be used to reduce consumption and save money, but in most cases, utilities have locked up the information in inaccessible formats. In this episode, Michael Murray, leader of business coalition Mission:data, describes the potential value of smart meter data and the group’s ongoing efforts to pry it from utilities. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Over the past five years, Colorado’s Democratic trifecta has produced a cascade of legislation on climate, energy, housing, and land use (among other things). In this episode, we dive into some of these achievements and the politics behind them with Gov. Jared Polis and his top climate policy advisor (and previous Volts guest) Will Toor. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

NYC’s Revel is trying to build urban EV fast chargers and demand for those chargers (in the form of its own EV rideshare network) simultaneously. In this episode, Revel’s Tobias Lescht discusses the challenges of urban fast charging and the company’s plans to expand beyond NYC. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

For years, perovskite solar cells have been the Next Big Thing in solar. In this episode, Joel Jean, co-founder and CEO of Swift Solar, explains what exactly perovskites are, the performance and weight advantages they promise, the challenges they face, and when they might actually reach market. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

An enormous amount of wood is harvested from forests in the southern US to be burned in Europe as “renewable energy.” Now the industry wants to open more wood-pellet facilities in the Pacific Northwest. In this episode, Rita Frost of NRDC and Brenna Bell of 350 PDX explain why that’s a bad idea and why wood pellets aren’t as renewable as they look. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Beverly Craig of the Massachusetts Clean Energy Center discusses what passive house building principles entail, the benefits they generate for building occupants and the grid, and what it would take to persuade more US builders and policymakers to adopt them. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

EVs are great for people with garages to charge them in, but what about everyone else? In this episode, Gabe Klein of DOE’s Joint Office of Energy and Transportation talks us through new approaches to EV charging for people in multifamily residences in urban settings, including new business models, new technologies, and even new vehicles. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, David Wooley and Ed Carr, lead authors of recent papers outlining policy and technology options for reducing emissions in the shipping industry, discuss the fuels (and batteries?) that could power ships of the future, the policies needed to move forward, and California's pivotal role. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

A startup called Mattiq is using a combination of nanotechnology, AI, and electrolysis to produce novel materials that could eventually substitute for carbon-intensive materials in sectors from chemicals to plastics to fuels. In this episode, CEO Jeff Erhardt and I dig into the technological and business details. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, CEO Siyu Huang of Factorial Energy talks through recent advancements in solid-state batteries, which promise significant improvements in energy density and safety and are paving the way for electric vehicles with substantially increased range to hit the market within the next few years. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

A new startup called Base Power aims to bring more stability to the volatile Texas grid by selling customers oversized home batteries at minimal costs and then using the excess capacity to trade on the market. In this episode, co-founders Zach Dell and Justin Lopas discuss their innovative business model and its potential impact in Texas and beyond. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

US public education infrastructure faces significant challenges due to years of deferred maintenance and the growing impacts of climate change. Luckily, the Inflation Reduction Act offers substantial, easily accessible financial assistance to schools in the form of direct-pay tax credits for climate-friendly upgrades. Many schools don’t even know about them. In this episode, Sara Ross and Jonathan Klein of UndauntedK12 discuss their efforts to spread the word. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode: more heat pumps! Jane Melia, co-founder and CEO of Harvest, discusses the advantages of teaming a high-end eat pump with a large thermal battery, to coordinate the timing of electricity consumption. Shifting the heat pump load can help reduce both costs and emissions. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

New York City was on the cusp of (finally) implementing a congestion pricing program when Governor Kathy Hochul announced earlier this month that it would be “indefinitely delayed.” In this episode, NY State Sen. Liz Krueger and Evergreen Action’s Justin Balik, both with deep history in New York’s congestion pricing drama, discuss Hochul’s mysterious and possibly illegal move, the apocalyptic budget implications, and what might happen next. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, CEO Kyle Clark of BETA Technologies walks us through the details of how to design, build, and operate electric planes — first for relatively short light-cargo flights, but eventually, he says, for all of aviation. I loved this conversation so much. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, recorded at a live event, Washington State Governor Jay Inslee discusses his multiple decades of climate advocacy, his political successes, and the upcoming threat to one of his crowning achievements. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In his book The Price Is Wrong, Brett Christophers argues that, contrary to recent economic triumphalism among renewables advocates, wind and solar are not profitable enough to attract the private capital necessary to scale as fast as they need to scale. In this episode, he and I dig deep (extremely deep) into the details. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I have a lively conversation with Alp Kucukelbir, co-author of a recent “Artificial Intelligence for Climate Change Mitigation Roadmap,” about the strengths and limits of AI in relation to climate, where it all might be headed, and how concerned we should be about the energy use of data centers. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

More than half a billion people on the African continent lack access to electricity, and the number is only growing. In this episode, Tombo Banda of CrossBoundary’s Mini-Grid Innovation Lab discusses the longstanding barriers to electricity access in sub-Saharan Africa, why current business models haven’t been effective, and the mini-grid innovations that could turn the tide. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Steel production generates almost 10 percent of global carbon emissions and has long been considered “hard to abate.” Enter Boston Metal, a startup that aims to make carbon-free steel using only (sing it with me!) clean electricity. In this episode, CEO Tadeu Carneiro explains “molten oxide electrolysis” and its potential to transform the industry. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Rob Gramlich of Grid Strategies comes back on the pod to discuss the suddenly sizzling transmission world, where both President Biden and the Federal Energy Regulatory Commission have recently announced significant updates to transmission planning, permitting, and funding. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Which political races should climate advocates focus on to get the most bang for their buck? (Hint: not the presidency.) In this episode, executive director Caroline Spears of Climate Cabinet explains how her organization uses data science to identify state and local races with high potential to impact climate progress. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I talk with CEO Paul Lambert of startup Quilt, which came out of stealth this week with heat pumps that are not ugly. They perform well too, and are easy to buy and install, but mostly they’re not ugly. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, California electricity guru Lorenzo Kristov shares his vision of a just, democratic, “bottom-up” grid based in distributed local energy. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Climate awareness is growing in the real world, but it remains rare in popular entertainment, as illustrated by some new research on climate in film. In this episode, Anna Jane Joyner discusses the efforts of her nonprofit, Good Energy, to help screenwriters tell climate stories better (or at all). This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Grace Van Horn and Jonas Monast of the Center for Applied Environmental Law and Policy do a deep analysis on the EPA’s recently finalized carbon pollution standards for power plants. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, longtime clean-energy analyst Michael Liebreich assesses five causes for pessimism about the net-zero transition, alongside five causes for optimism. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Joselyn Lai of Bedrock Energy describes hardware and software improvements that enable geothermal heat pumps to be installed more quickly and less expensively, even in large commercial and industrial buildings in tight urban spaces. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

What’s the best way to handle rising US electricity demand? Contrary to what some large utilities and regulators think, it’s not building new fossil gas plants. In this episode, Eric Gimon and Michelle Solomon, coauthors of a new report from policy shop Energy Innovation, make the case that utilities have more effective options to address both short- and long-term demand. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

The Inflation Reduction Act made it much easier for companies to sell clean energy tax credits that they cannot make use of themselves. In this episode, CEO Alfred Johnson of Crux Climate explains how this seemingly wonky tweak has created a market that is already providing billions in new clean-energy investment. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Is China on track to reduce its carbon emissions? If so, why is it building so much coal power? In this episode, researcher Lauri Myllyvirta brings data to bear on China’s recent decarbonization efforts and helps demystify the country’s larger intentions. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I speak with Maxine Bédat, a former fashion startup CEO and founder of the nonprofit New Standards Institute. We talk about the source of the fashion industry's emissions, what can be done to reduce them, the need for regulation, and the right way to think about fast fashion. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I speak with Heather House, a manager in RMI’s carbon-free transportation program, and Rushad Nanavatty, the head of Third Derivative, an early-stage climate tech accelerator co-founded by RMI, to better understand the role of urban land use in the overall climate picture. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

The Inflation Reduction Act included a Greenhouse Gas Reduction Fund, $27 billion to be disseminated primarily in vulnerable and under-resourced communities for clean energy and climate mitigation projects. In this episode, EPA’s Jahi Wise discusses how the program was designed, who the recipients are, and what the funding will accomplish. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Duncan Campbell of Scale Microgrid Solutions makes the case that distributed energy resources (DERs) — solar panels, EVs, home batteries, etc. — are, thanks to rising electricity demand and constraints on grid expansion, poised for a tsunami of deployment. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

This week, the Biden administration announced billions of dollars in grants for industrial emissions-reduction projects. In this episode, Rebecca Dell of the ClimateWorks Foundation and Evan Gillespie of Industrious Labs describe the types of projects being funded and assess the potential impact of this significant investment in a sector notoriously difficult to decarbonize. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I discuss the newly launched MethaneSAT — a satellite that can detect methane emissions on the ground — with Mark Brownstein of the Environmental Defense Fund. We cover how it came to be, its technical capacities, and the ways satellite detection might serve global efforts to reduce emissions. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

“Scope 3” greenhouse gas emissions — those that companies are indirectly responsible for, via supply chain, product disposal, investments, etc. — are an imprecisely measured but significant source of impact. In this episode, Laura Draucker of the nonprofit Ceres shares her expertise on all things scope 3, including the recent decision by the Securities and Exchange Commission to drop the requirement that companies disclose them. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In his recent role as Chief Advisor for the Clean Energy Transition in the White House Office of Science and Technology, Costa Samaras helped roadmap the cleantech future laid out by Democrats’ legislative achievements. In this episode, he reflects on his experience and offers a clear-eyed view of where climate policy needs to go next. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Is the Inflation Reduction Act, passed nearly two years ago, doing what it set out to do? In this episode, Trevor Houser of the Rhodium Group compares the predictions of pre-IRA energy-sector models to the real-world data on clean-energy investment since its passage. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, we go deep on industrial policy with Todd Tucker of the Roosevelt Institute. We discuss what it is, why it’s needed, what Biden’s particular version of it looks like, and how it could evolve if he wins a second term. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Huffington Post reporter Alexander Kaufman traces the recent history of US building codes, a surprisingly compelling and twisty tale of efforts at reform meeting stiff resistance from builders and natural gas companies. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Cora Wyent walks us through Rewiring America’s “personal electrification planner,” a step-by-step how-to for homeowners (and renters!) looking to electrify their homes. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I speak with Jigar Shah (head of DOE’s Loan Programs Office) about all things nuclear, including its recent performance, the strategies that could revive and accelerate it, new nuclear technologies and what small modular reactors actually are, and the role that nuclear will play in a decarbonized economy. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Reps. Sean Casten (D-Ill.) and Mike Levin (D-Calif.) discuss their Clean Electricity and Transmission Acceleration Act, explaining where Democrats have found consensus around transmission permitting and community engagement. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, journalist Hamilton Nolan shares about his upcoming book The Hammer, a deep dive into the current tattered state of unions in the US and the prospects for their future. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, I interview Fourth Power CTO Asegun Henry and CEO Arvin Ganesan, who bring high-profile experience in energy research, policy, and regulation to their new and promising thermal storage startup. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Upgrading power lines — “reconductoring,” in the biz — is a straightforward way to boost the capacity of the electrical grid by enabling it to transmit more power and leak less of it. In this episode, TS Conductor CEO Jason Huang and researcher Emilia Chojkiewicz speak to the great potential of reconductoring, if balky utilities can be convinced to deploy the new technology. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Given the trajectory of the electric vehicle industry and the expected lifespan of an EV’s lithium-ion battery, the US is only a few years out from needing large-scale, cost-effective, decarbonized ways to recycle batteries. In this episode, Steve Cotton, CEO of Aqua Metals, describes regenerative electro-hydrometallurgy — the new battery recycling method that’s not only fun to say, but run on clean, cheap renewable electricity too. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Michigan State Senator Sam Singh details the ambitious clean energy policies that have been enacted since Democrats won a legislative trifecta in 2022, including some bold reforms of clean-energy permitting. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

The Australian state of Victoria, home to the city of Melbourne, is the country’s most densely populated state and also its most dependent on fossil gas. In this episode, Lily D’Ambrosio, Victoria’s Minister for Energy, Environment, and Climate Change, shares about the state government’s aim to shift away from fossil gas, its aptly named Gas Substitution Roadmap, and the current status of its decarbonization push. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, David Doniger of the Natural Resources Defense Council explains what the Chevron doctrine is, why the federal judiciary has traditionally been deferential to agencies’ regulatory reasoning, and the potential fallout in the very real chance that the current Supreme Court does away with the doctrine entirely. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Chairman Marisa Gillett of Connecticut’s Public Utilities Regulatory Authority (PURA) talks about her aim to reform the cozy regulatory environment enjoyed by the state’s big utilities, PURA’s new Equitable Modern Grid Initiative, and how ratepayers benefit from a shakeup of the status quo. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

As Chief of Energy, Sustainability, and Transportation at the Chancellor’s Office of California State University, Lindsey Rowell is charged with developing and implementing a plan to decarbonize every aspect of the school system, on all 23 campuses, with minimal use of offsets, by 2045. In this episode, she lays out what it will take to tackle this ambitious goal.(PDF transcript)(Active transcript)Text transcript:David RobertsContemplate, if you will, the California State University system. It is the largest public-university system in the country — by some accounts, the largest in the world — with more than a half-million students and some 55,000 faculty and staff, spread across a sprawling network of 23 campuses, from the top of the state to the bottom.What if I told you that it was your job to decarbonize that entire system — the buildings, the energy infrastructure, the transportation, the food, the construction materials, all of it — and you had just over 20 years to do it. Would you panic? Possibly short circuit? I'm pretty sure I would.As it happens, though, that is someone's job. Her name is Lindsey Rowell and she is the Chief of Energy, Sustainability, and Transportation at the Chancellor’s Office. She is on the hook for developing and implementing a plan to make the entire CSU system carbon neutral by 2045, with minimal use of offsets.You might think, to accomplish something so vast, she would have a team of dozens and a budget of billions. But this is a public university system, so of course she doesn't — instead it's duct tape, baling wire, and ingenuity. I had a great time talking with her about how to approach this unwieldy project. I think you will find her pragmatism and good humor refreshing.Every policy or regulation ultimately must be implemented by someone on the ground. This is what that looks like. All right then. Lindsey Rowell, welcome to Volts. Thank you so much for coming.Lindsey RowellThank you so much for having me.David RobertsThis is really interesting, a lot of really interesting stuff here — I have a million questions to get through to ask you. But for starters, why don't you just tell us a little bit about the California State University system, which is different than the University of California system. Just getting that right up front.Lindsey RowellLet's get that out of the way. We are so different. Sure thing. So, California State University system, whether you realize it or not, you probably know it. We are the largest public university system in the country, by some metrics in the world, depending on who you ask on which day. So we have 23 campuses in the system spread across the state, from the very tippy top up in Humboldt and down to the very, very bottom of the state in San Diego. So we cover the entire space in California, and we've been educating students for about 150 years.So we have really old universities. We also have a few satellite locations that offer specialty coursework in nursing or business. And we educate about half a million students with about 55,000 faculty and staff. So we are a huge, hug organization, and the schools, probably people are most familiar with without realizing that they are CSU schools, are the California Polytechnic University at San Luis Obispo — it's one that a lot of folks don't realize as part of our system. And we have three Cal Polys now, Humboldt is a Cal Poly and Cal Poly Pomona, and then, of course, San Diego State is one of our biggest.San Diego, Fullerton, and Long Beach are three of our biggest institutions in Southern California. Reason?David RobertsAre they all four-year undergrad colleges, or are there some vocational stuff or community colleges?Lindsey RowellSo no community colleges. The community college system is a separate but friendly sister organization, complete state organization. And the CSU is a four-year institution and graduate program. So we have masters, and we do have educational doctorate programs at a few of the campuses. So four-plus years.David RobertsSo 23 campuses?Lindsey RowellYes.David RobertsAcross the state. That's a lot. So tell us, then, what laws you are like — what are your mandated goals here? And are they mandated by the state of California, or does CSU have its own separate goals, or are these all just sort of state goals that you're implementing?Lindsey RowellSo, without getting too boring into the legislative dynamic of the CSU, we're sort of a quasi-state agency. So what that usually means is that most regulatory and legislative mandates are applicable to us where we're mentioned specifically. Part of that is due to the fact that we are called out specifically in the government code. So we are our own authority having jurisdiction, if you want a technical term, and then we are self support — a portion of our work is self support through student tuition and endowments and so forth. So what that means is the CSU often sets more ambitious goals.I cannot think of anything off the top of my head where we are not, at the very least, meeting California's goals. As California gets more robust in its challenges towards climate change, I think the gap between California requirements and CSU requirements is closing. But, yes, we align with the state in pretty much everything we do, either by intent or by statute.David RobertsThe broad framework I've been thinking about this in know, I think a lot about policy and laws and politics and getting laws passed, but every law that passes, someone has to do it, right? Someone has to implement it. And so I've just been giving a lot of thought to, who are the people out on the front lines implementing these things? So part of why I'm asking is, what happens if you don't meet them. Are these self imposed goals where if you don't meet them, for whatever reason, you're just like, "Ah, we swung and missed. Bummer." Or is there some legal penalty if you don't reach them?Like, what happens if you don't meet these goals?Lindsey RowellThat's a fun question because my first answer is the world ends. That's what happens. So government, as you know, is generally a carrot sort of organization, not a stick organization. I mean, punitive response to not meeting legislation is usually reserved for the private sector. And government agencies are, you know, sort of pressured to respond to these mandates, but without, you know, punitive expectations if they don't make them. That said, though, and I'm going to offer a little prediction — this is Lindsey Rowell's prediction, this is not the CSU's prediction, disclaimer — that because the intensity of the climate crisis just ever increases. And it's funny that we're doing this today, David, because I just saw all the news of the massive waves in hitting the California coastline.I don't think I've ever seen that in my lifetime due to Pacific storms. And so what I predict is going to happen is there's going to be this sort of the incentive approach, right, where there's programs to support government agencies meeting these standards and goals, and then there'll start to be some hand slapping, maybe there will be some tightening of the purse strings with regard to funding that comes our way. And then I do think eventually there will be punitive damages in the form of carbon taxes or more direct funding cut offs.David RobertsRight. So sticks will show up eventually.Lindsey RowellI think they've got to. I mean, I think at some point you can't rely on folks to do this work voluntarily. And I think governments often have to choose between the two pennies that they have to rub together, as one of my staff likes to say, which I think is a great metaphor.David RobertsWell, actually, wait, we have to rewind because we skipped what the goals actually are, right. CSU imposes its own goals, but what is the goal? I forgot to get that on record.Lindsey RowellThat's actually a great one. We should talk about that. So, the CSU, we have a new sustainability policy. And I say new. Actually, I'm thinking that it's not so new anymore. So we passed a new sustainability policy right after I came back to the CSU. So this is January of 2022. And the new sustainability policy, the overarching goal, is carbon neutrality by 2045.David RobertsAnd is that the same as the state?Lindsey RowellYes, that's the same goal as the state. Now, campuses have individual goals that might be more aggressive. Some are targeting as early as 2030, which is terrifying, but great to see that ambition out there. So that's the overarching goal. But within that, mostly what we've done is aligned with the AASHE STARS program, if you're not familiar. AASHE is the Association for the Advancement of Sustainability in Higher Education, and they have a tracking system, and it sort of captures everything with regard to sustainability across the board, in curriculum, in student basic needs, in diversity, equity, inclusion.So we've sort of aligned our policy to tackle all of those overarching umbrella criteria and then the various credits underneath those. So we have a lot of goals, but the overarching one that is sort of the point to it all is this carbon neutrality by 2045 as a system.David RobertsAnd what's your job? You have to do that.Lindsey RowellExplaining that to my mother for like 15 years, we just had Christmas: "What do you do for a living?" Basically, our role at the chancellor's office is to sort of advise and facilitate and implement these goals through policy, through programs. So we do a lot of program development and more recently, a lot more advocacy. So you were talking about your interest in policy and legislation. We have gotten very heavily involved on the state and federal legislative side, trying to express the need that the CSU has to inform the powers that be of the group of individuals that we serve, which is, generally speaking, disadvantaged communities, underrepresented minorities, first-generation college students.So, as we sort of pursue all of this, our jobs kind of touch everything. We also do broad-scale procurement. We do direct access energy procurement for 14 of the campuses, meaning we buy energy on the wholesale market, then transmission and distribution to the utilities, and then bundled service for the rest of the campuses. So we have all of that. We do climate action planning for the campuses, water conservation, sustainable procurement, waste management, sustainable foods.David RobertsYeah, I was going to say, I mean, this is the point of all this setup, is to get this in readers' minds, is that you are sitting in your office having to think about how to get 23 campuses, physical campuses across the state, to carbon neutrality by 2045.Lindsey RowellRight.David RobertsAnd when I start thinking about that —Lindsey RowellIt gives you anxiety?David Roberts— it causes a pain behind my right eye. My hands start to shake. To me, that's just like a huge — maybe you've grown accustomed to it over time, but to me, it just seems like such a huge, sprawling thing. It kind of makes my brain short circuit.Lindsey RowellIt does that to us. We spend a lot of time sort of mentally advocating for each other, just going, "We can do this. We can do this. We got to just fly forward and it's eating the elephant just one bite at a time."David RobertsYeah, no kidding. The first thing I wanted to ask is just, this seems like, among other things, it's going to take a lot of resources. It's going to take a lot of money to do this. So I was just like, what is your budget? Do you have the budget to achieve this?Lindsey RowellTo all legislators and decision-makers listening, we do not. So we have about a $7 billion deferred maintenance backlog.David RobertsOh, goodness.Lindsey RowellYeah. And that's not, "woe is us", sort of — that's not that kind of a comment because the UC and the community colleges of the state at large, this is something we deal with. They're chronically underfunded organizations, as government organizations tend to be. I mean, when we talk about the numbers needed for this type of work, especially decarbonization, just electrification. So let's just talk about electrification plans. The numbers aren't even real numbers, David. They're not numbers that you and I — and we hear them. We hear Jeff Bezos has $65 trillion or whatever. We know that's a figure. But when someone says to you, "Oh, just to electrify your central plant, that serves a campus that occupies, I don't know, let's say, 4 million square feet, is going to cost you, for starters, $350 million for the engineering and the basic equipment change out."So that doesn't include things like switching everything over to the proper coils that can take the lower temperature hot water to circulate to buildings. That doesn't include any of the offsetting renewable energy and all of that that's required to actually get to net zero. That's an insane number. So when you start to think about that across a whole campus, the number is probably closer to 500 million, a billion per campus and then 23 campuses.David RobertsYeah, it adds right up.Lindsey RowellHuge numbers. They're huge numbers.David RobertsYeah. So I guess that's kind of where I want to start before getting into the details. Just like, how am I not to conclude that this is just impossible what they're asking you to do? The scale of what they're asking you to do with the money you have available to do it, how do you get around that basic —Lindsey RowellLet me give you some of my —David RobertsCoping strategies?Lindsey RowellI was going to say my coping strategies, the little things I hang on to as signs of progress. First of all, so for the CSU, we have managed to keep our energy use level over the past almost two decades, despite adding thousands and thousands of square feet. So we're good at energy efficiency, and we've managed to do it with no direct — we have no direct budget assigned for that kind of work. So this is usually nickel and diming an operational budget. This is capturing incentives through utility programs or federal grant programs.So we do a lot of sort of little things where we chip away at the problem, and that actually is tremendously effective. One of our campuses, one of our energy managers, his name is Kenny Seeton, and I can take his name in vain because we're good friends and he's been around for as long as I have in the CSU. And one of the things he does so well is he'll do things like he'll have $1,000 left on his purchasing, his pro card, at the end of the month, and he'll buy a bunch of lamps or he'll buy a bunch of meters and he'll just keep them in his office until he's got 100 of them. And then he'll rally his team and be like "All right, guys, this weekend we're going to go through and we're going to install all of these."He'll probably be the first campus to meet the net zero goals, and he's done it all without a dedicated energy budget.David RobertsAmazing.Lindsey RowellSo, the answer to your question is so fluid. I think the federal government is finally starting to put some real money behind these efforts.David RobertsYeah, I was going to ask, like, IRA, the Inflation Reduction Act, actually just showering money down on everything. Are you going to be able to harvest some of that?Lindsey RowellYeah, we're really, really trying. So that's a big part of our advocacy program. We've kind of got a two-path, two-pronged approach. One is sort of short term, what can we capture from the Inflation Reduction Act? Which includes stuff that we're kind of already doing, centered around investment tax credits for renewable energy. It also includes the energy efficiency tax credits, things like that, that have traditionally not — we've had to capture through third-party developers. The difficulty, and this is the second prong, the sort of longer-term approach in making legislators understand what it's like to have this money on the ground is a couple of things.One, we don't have the upfront cash for this type of work. So when a campus has to make a decision, when they say, "Oh, 40% of this or 60% even of this renewables project, the solar project that we want to do is going to come back to us." We still have to come up with the $7-$10 million upfront to do the project.David RobertsBecause you get it back in tax —Lindsey RowellExactly.David RobertsUnder taxes. Right.Lindsey RowellAnd the problem that we have with that is that that money takes away from something else. And every time I sort of bring this question up with folks, let's just say "the folks," the question is always sort of like, "Well, why don't you have money?" The question is always like, "Well, why don't you just take some money from somewhere else?" It's like, no, you don't understand. That's like saying, "I have $0 in my checking account, write a check, and then —" it doesn't work like that.David RobertsHaven't some of the tax credits been made direct pay?Lindsey RowellThey are, but they're still reimbursable. And so the issue with that upfront capital means that for us, it's typically not that much more advantageous for us to own one of — a solar system is just the easiest example because power purchase agreements have been around for a million years. When campuses do that, the benefit they have, I mentioned our $7 billion deferred maintenance backlog. Well, what does that tell you? We don't have the money to maintain things. So the last thing we need is to own a sophisticated piece of equipment. That we may or may not have the staff who really knows how to manage it other than basic maintenance.We're still going to have to contract out to switch out the inverters every 5-10 years, whatever, as they degrade. So we haven't found that particular element of the program as directly advantageous. I don't want to disparage the program because I think it's incredible that this amount of money and effort is getting put towards this work, but we need bigger chunks of money available to really invest.David RobertsAre you asking the state government? I assume you're up in Sacramento —Lindsey RowellYeah.David Roberts— nagging the relevant people.Lindsey RowellWe're working with legislators in Sacramento and in DC because a lot of this money — this amount of money has got to come from the federal level. Right. The state has, California has a lot of money —David RobertsBut a lot of debt, too.Lindsey RowellHas a lot of debt and it has a huge population that it has to serve and we need big federal dollars that are coming. And so just trying to help folks understand the actual set of circumstances when someone needs to cut a check —David RobertsThat's what it comes down to.Lindsey RowellYeah, what it comes down to because we don't want to lose a lot of money through administrative processes. And the other thing with that that I think is really important to mention that I think does not get understood on the Hill, for example, is that when you have a rigorous process for these programs, the institutions that get left behind are the same institutions and the same people that get left behind for every other social economic climate program there is: It's the poor people with no resources. They don't have the money to contract for consultants to help them do these applications.David RobertsSo the application process itself is a barrier.Lindsey RowellYeah, yeah. So there needs to be some streamlining, and I think the federal government has heard that. But, of course, when these statutes are written, they come with a lot of legal constraints that they have. So it's just tremendously complicated. It's not like someone on the Hill can wave a magic wand and just go "Oh, we'll just do it like this." Because they also are responsible for taxpayer dollars, and they better make sure that if they're going to put a trillion dollars towards something, it's going to get spent where they said it's going to get spent.David RobertsRight. Well, let's talk some nuts and bolts. So you said you have a $7 billion with a B deferred maintenance backlog. I'm wondering if there are things you can do that would serve the dual purpose of maintenance and decarbonization. In other words, could you try to dig out of that hole in a way that also serves your carbon goals?Lindsey RowellYes, 100%. That is actually our approach and has been forever. So we really look at opportunities to dovetail energy projects with maintenance projects for the simple reason that if you're going to cut into a hard lid and send some tradesperson up there crawling around, like, why do that twice?David RobertsYeah, right.Lindsey RowellJust the simple economics of that, of patching and painting and laying down equipment and bringing contractors out, is a lot cheaper to do one time than multiple times. One of the things we like to say in our unit is that all maintenance is energy efficiency. Right. You make pipes stop leaking, you make equipment more efficient, you change out fans that aren't working and dampers that are stuck and fix economizers, you're not only addressing your maintenance issues, but you are making things operate more efficiently. So we look at that approach, and luckily, this is an advantage that the CSU has with regard to how we spend our funding.We have this operational budget, and we don't have to say this money is going specifically for this project. We make that designation ourselves in our office. So as long as we're capturing it completely for the purposes of the Department of Finance, the scope can be the scope. So there's a little bit of flexibility there to make sure that money is being spent where it's supposed to be spent.David RobertsAnd I'm going to guess, as I was thinking about this, 23 campuses getting to zero carbon. My intuition was that buildings must be the big ticket item in terms of the heating and cooling, the amount of infrastructure required to heat and cool them, the construction budget itself, the embedded. Because one thing I thought was important to mention, I forgot to mention it earlier, but we should put this in the context of your goals, is that when you talk about carbon neutrality, you're also talking about scope 3 emissions.Lindsey RowellIt's so scary.David RobertsYeah, that's the most mind-blowing part to me, and I'm going to return to this later because for readers who are not familiar, scope 1 and 2 emissions are sort of the emissions from the energy that you're directly using. But scope 3 is the emissions sort of embedded in the materials you use, the energy that people use to transport themselves to the campus, like all sorts of sprawling stuff that goes well beyond the campuses. So we'll return to that later. But I'm assuming that. Am I right to say that buildings are sort of item one on the list here in terms of emissions?Lindsey RowellYeah, I think so. I mean, the estimates from the Department of Energy are all kind of — they shift a little bit, but generally we say between 30 and 40% of our emissions in the United States are attributable to buildings. Right.David RobertsYou think that's true of your system, too?Lindsey RowellYeah, I would say campuses are easiest to understand if you think of them as little cities, right. There's big buildings with various operations. All in all, it's operating on a curve that is similar to a city, right? Like early morning to midday and some into late night. And then there's a variety of practices between labs or a library or an office, whatever that's happening in there. And then they're spread out. Right. There's geography and landscaping and agriculture. There's everything.David RobertsFood. We're going to get to that later, too. But let's talk buildings. You must have some really old. You've been around a century. You must have some big old, drafty buildings, I'm guessing.Lindsey RowellYeah, Chico and San Jose have been around a very long time. Sacramento State just celebrated its 75th birthday, so there's a few things that have gotten taken care of through sort of seismic updates. After the 1989 quake, a lot of buildings across, not just for the CSU, but across the state, really got retrofitted to accommodate the moving and shaking that is our lovely state out here on the west coast. And at that time, windows, building skins, rooftops were replaced. Insulation was making buildings more efficient as part of just a general practice of making them more safe.But that said, there are still buildings from the 1980s and even the early 90s, when we were still kind of getting hip to a lot of these sort of efficiency practices. So, yeah, there's a lot of just general work to do. And then on top of that, the big thing, obviously, is the distribution of energy around the system.David RobertsYeah. Can you even generalize across 23 campuses? How are they generally heated and cooled?Lindsey RowellYeah, I can actually generalize. So pretty much every campus, in fact, I can't think of one off the top of my head, has a core campus that's served by a central, like a district energy system.David RobertsOh, all of them?Lindsey RowellYeah.David RobertsOh, interesting.Lindsey RowellSome of them have buildings that are sort of off the loop based on where they are on the campus property or who owns them, you know, if it was a public-private partnership or something like that. But, yeah, generally speaking, we have a district energy system at every campus. Some of them have co-generation. Although we had three campuses as part of the cap and trade program in California, we now are down to one. The other two have successfully decarbonized to get under the threshold for emissions to no longer need to be a part of that program. So that's really tremendous.And then we did have our one campus, Channel Islands, had a large 25 megawatt co-generation system that was partnered with the southern California energy utility for grid stability and parity. So that's generally the situation. Some campuses have really sophisticated tunnel systems, which are awesome because it makes maintenance and protection systems really great. But of course —David RobertsOh, it just like shelters the infrastructure, basically.Lindsey RowellIt does. And it means everything runs underground where temperatures stay more stable, access.David RobertsSo what are these district heating systems running on? You said there were three that were co-generation. What are the rest of them? Are most of them natural gas?Lindsey RowellNatural gas boilers, yeah.David RobertsAre there any geothermal?Lindsey RowellNo, we have no geothermal. In fact, didn't think that geothermal would really be a feasible option for us, but have recently learned that some of the newer geothermal technology, as it relates to ocean chilling could really maybe be something we use.David RobertsYes, I'm familiar and excited about those developments.Lindsey RowellThis is the best thing about this job. Right. There's always something changing in the technology that you get to learn.David RobertsSo you have lots of natural gas based district heating systems. What do you do to a natural gas based district heating system to decarbonize it? Do you just switch out the natural gas boiler for what, a big heat pump? What do you do?Lindsey RowellYeah. So that's where sort of the individual campus dynamic is going to become a bigger factor depending on how far they're moving heating — so our chilling is almost all electric. Most campuses have electric chilling, and that can be offset with renewables, which is fantastic. And then a lot of campuses have and or are looking at thermal energy storage, allowing them to benefit from that. So that's been really exciting. I love that work, and it's really just a good old fashioned energy project that's really solid.David RobertsCan I ask what kind of thermal storage people are looking at?Lindsey RowellCampuses have like a two phase ice system. Most of them have chilled water.David RobertsInteresting.Lindsey RowellLike water tanks, which works fantastic for 99% of the state. Humboldt is our little outlier up there — the place that never gets warm.David RobertsRight, the non-warm California campus.Lindsey RowellYeah, the one non-warm or San Francisco, I guess, could be —David RobertsYeah, I guess this should have occurred to me earlier, but I guess heating itself is not a big issue. Mostly you're dealing with air conditioning.Lindsey RowellRight. So, the boiler replacement is mostly — so, you know, our temperate climate gives us a couple of benefits. One, the boilers that are out there on the market can serve our purposes if we can figure out a way to lower temperature and circulation without causing major issues with our distribution system, like leaking Victaulics and other valves in the system. And also if we have coils throughout our units, our air handlers and units throughout buildings that can function on that lower temperature hot water. If they can't, then we're talking about — there's major engineering you're having to take out, replace a natural gas boiler with electric heating boiler.Can't get the water up to circulating at 185 degrees. It's circulating at 145, maybe 155. And you've got coils in your units that maybe are only thresholded at 165. All of that stuff has to get replaced.David RobertsSo if you switch out the boiler, there's a bunch of other reengineering —Lindsey RowellThere can be. And for most of our campuses, it seems like that all of those secondary effects are needed, although I don't know, if it keeps getting warmer, maybe we won't need to heat at all.David RobertsDo all of your campuses have, like, energy people, managers, somebody whose job it is to?Lindsey RowellYes, aside from vacancies that occur through attrition and things like that, part of our requirement is that every campus have an energy manager. They do a tremendous amount of work on this. But like the central plant, the district heating question with the boilers, a lot of these campuses, their domestic hot water is tied to their district hot water, their heating hot water. So for them to just — they can't just turn off their boilers in the summer. For example, one of our mechanical review board members loves to — he's like, "Why are they running the boilers in the summer?It's like, "Well, you still got to have hot water in your labs and your lavatories." So sort of this, like, well, I guess I would say lack of foresight, but it's not really that. Right? Lack of crystal ball, when years ago, these systems were created.David RobertsSo if you can get the systems onto electricity, basically, you can call that carbon neutral by buying renewable energy certificates, basically, by vouchsafing that the electricity is clean. Is that the idea?Lindsey RowellNot allowed in the CSU.David RobertsOh, really? You guys are really playing on the hard setting, then.Lindsey RowellThat's not true. It's not not allowed in the CSU. It's not allowed by Lindsey. So if someone else comes along and says, "You're stupid and this is impractical", they can —David Roberts"Good God, woman, make things easier for yourself for once."Lindsey RowellI know this is a deep, dark hole that we've dug ourselves, but my feeling about offsetting is that our points of pride in the CSU are that the community that we serve stays here. So our students tend to live and work in the communities where they go to school. One in ten workers in California has a CSU degree. I feel that buying credits is a misrepresentation of our obligation to the people that we serve. And so, our working policy now, within my group and with the support of my team, our team, is that we will not purchase offsets until we get to that point where we just, like, can't.We don't have the money, or that we're at that last 5% or 10% to get over the hump. And realistically, we'd like to keep it in the family. Right. Where we have a CSU fence line, and we go, okay, if we're buying offsets, it's through a campus over generating, and we're accounting for it at another campus that can't.David RobertsWe might be talking about two different things. Two things to keep distinct. One is carbon offsets.Lindsey RowellSure. And one is renewable energy credits, and...David RobertsOne is renewable energy credits. Offsets. I can see absolutely the case for not relying on offsets. I get. But for your electricity, if you don't rely on renewable energy credits, you are having to self generate in real time the electricity you're using —Lindsey RowellThat is what we're angling for.David RobertsWhich is super hard.Lindsey RowellYeah, it is super hard. I'm kind of conflating the two. Because —David RobertsYou don't want to do either.Lindsey RowellYeah, they're interchangeable in my mind. So really, what we want to see happen is that we exhaust all opportunity to generate on our campuses the offset that we need and own those credits. Now, the fact I was born at night but not last night, I know that that is a huge undertaking.David RobertsYeah, as part of this, you must be trying to install quite a bit of —Lindsey RowellWe are.David RobertsYeah. Renewable energy on your campuses.Lindsey RowellWe are. Tremendous amounts of renewable. And also looking at, like I said, maybe an opportunity for geothermal, like large scale geothermal that a single campus wouldn't be able to use. But we could sort of account for that again in the family.David RobertsRight. Sort of sell it to another campus, more or less, kind of. I mean, surely if you have 23 campuses in California, some of them are sitting on top of some geothermal.Lindsey RowellOh, for sure. Especially up north, and then it looks like down south and in the Imperial Valley, there's possibly some opportunities, and we're starting to investigate that as how do we do a partnership on that in a way to afford it.David RobertsWould be nice to get like a real power plant sized power plant.Lindsey RowellOh, it'd be so cool. If anyone out there wants to write me a check...David RobertsYeah. Because everything else is just like little bits here and there. So I guess you're like covering all your roofs with solar panels. Parking...Lindsey RowellYeah, mostly parking. Roofs are tricky just because of warranties and access and that kind of thing, and the age of our buildings. But we're really trying to do this to where the CSU is in and of itself, carbon neutral and net zero. And we've set the goal that way, knowing that getting to 0% is like, that's not a real thing, right? Functional zero. And knowing that we're probably going to hit a wall at some point where it's like we're constrained by finances, we're constrained by property, we're constrained —David RobertsWell, yeah, land.Lindsey RowellYeah. There's a whole bunch of potential hurdles there that might just put up a brick wall that we can't get through.David RobertsCould you theoretically own a big solar field that's not on one of your campuses, like somewhere else?Lindsey RowellI mean, some of the campuses. Cal Poly SLO has actually done that through the RES-BCT program for the PG&E. They've put in a large — you know, now, for the purposes of this discussion, don't quote me, because I can't remember if the campus actually owns the property or if it's a lease agreement, but it's off the campus proper. They've got a large system that they installed to serve, like their equine center and their ag center that are off the campus grid, basically.David RobertsIs there a campus that is generating as much electricity as it is using yet?Lindsey RowellThere's a couple campuses that are close. So Long beach is actually pretty close. I think Fullerton is pretty close. Sac State is going to be pretty close. Several of the campuses are under contract for solar and microgrid systems that are going to get them close, at the very least, going to position themselves for meeting those longer term goals.David RobertsYeah, I do see now why a geothermal power plant would really come in.Lindsey RowellThat'd be cool. It'd come in super handy.David RobertsYeah. Speaking of microgrids, I love me some microgrids. And campuses are sort of kind of the iconic place to do it. You have control of the whole system. So do you have microgrids, islandable microgrids set up anywhere yet?Lindsey RowellSo, we don't have islandable microgrids. The regulatory environment in California to actually come off grid is extremely, I'll say, complicated. You could do a whole show on that, David. Actually, it would be really interesting to hear how people characterize that situation, but we're really approaching it right now through the lens of resiliency, because since the paradise fire in northern California in 2017, the public safety shut offs that the utilities are allowed to enact to protect the grid during inclement weather has affected campuses pretty severely. They've lost power for five, six, seven days.David RobertsYeah. And it occurs to me that you must have some labs and stuff where a blackout is a big deal.Lindsey RowellYes, that's very true. We have labs, we have vivariums, we have critical ops. We have archives, all kinds of stuff that needs to be protected. And obviously, we have generators, but no one designs a generator to run for ten days. So even on e-circuits, it's still more than we're capable of supporting over a long period of time. So, we're looking at a lot of this as an opportunity to reconfigure our electrical system so that only the appropriate operations are served by emergency circuits, and that we have battery backup that offers some longer term, and then also, at least in the interim, pair it with our — some campuses have fuel cells. All of them have generators. So use that microgrid operation for a resiliency purpose. Not so much for islanding right now.David RobertsSo is there a campus currently where if the grid goes down for one of these planned outages, it can stay on? Is that, like, up and running anywhere, or is this just a gleam in your eye?Lindsey RowellWell, I guess I should ask a clarifying question. If you mean are there any campuses that could continue business as usual?David RobertsWell. How about continue some modified, reduced version of business as usual. So their vivariums, right, and labs can stay going, let's say.Lindsey RowellYeah. So every campus can do that to a degree. Right. So every campus has enough backup. But I wouldn't say — I'm going to infer what you're asking and basically say, could you go to minimal operations where some classes or some research?David RobertsYeah, yeah, yeah.Lindsey RowellBasically the answer to that is "no." There's enough backup generation to allow enough time so that a faculty member, for example, could make alternative arrangements for their critters that they're researching somewhere or something like that. Or make a note on their data that there was a disruption. There's enough time to kind of get your affairs in order.David RobertsRight.Lindsey RowellOkay, we're going minimal ops, and this one room is going to be available. Ideally, we'd have something like that, although I would say, interestingly, the pandemic has changed that. Right. Our ability to pivot to an online pedagogy has, like, wow, suddenly we can do that. So a very few classes that can't just go, "okay, we're going to catch up on labs when we get through this outage in a few days."David RobertsSo, beefing that up, it seems to me, was mostly about installing more solar and more batteries. Are you just going nuts on storage?Lindsey RowellWe are. We're really trying. It's difficult because, again, we're doing that through third party power purchase agreements. But we have a few campuses, actually, that are under contract right now for solar and battery. So kind of the building blocks of their microgrids. And then we'll look towards expanding into microgrid controllers and all of the secondary electrical work. Actually, we have quite a few. Several of the Sonoma State has broken ground on theirs. Cal Poly Humboldt, Cal State San Marcos, they're all moving forward with their microgrid plans, and that's just to name a few.David RobertsFinal electricity/building question is, since you have these semi self-contained campuses, can they serve as virtual power plants? Can they sell grid services? Is that even up and running yet in California? Is that doable yet, or is that something you have on the horizon?Lindsey RowellI'm so glad you asked that question. I'm super duper, duper excited about virtual power planting.David RobertsMe too. I need to do an episode just on them.Lindsey RowellYeah, yeah, you really should, because I'm just learning about this — yes. So the answer to your question is yes, no, yes, yes. It's not happening yet in California. There's definitely some regulatory hurdles here. There used to be sort of virtual net metering and aggregated net metering programs in place with the utilities that have gone away over the time or morphed into different things and so there's some regulatory issues to deal with there. But my team and I have really been talking about the coordination between our microgrids and our thermal energy storage as a real opportunity to virtual power plant among our campuses and also —David RobertsDemand shift.Lindsey RowellYeah, demand shift. And also as an opportunity as we're talking about these sort of what do we do with the campuses that can't put renewable energy right. Can we help support each other in this sort of regional way? So, we're just in our infancy sort of investigating this, but so excited about the possibilities.David RobertsYeah, I wonder and maybe things aren't far enough along for you to know this, but I don't have any sense of what the scale could be on that. Would you imagine being compensated for grid services in your various campuses being a real substantial income stream? Or is this more like a frill? Do you know what I mean? Like how are you thinking about it?Lindsey RowellSo my first response to that is I don't know, but my second response is based on California's history with how it operates within the confines of utility regulation and with our new NEM 3.0 requirements, I cannot see this being an income stream. That's me and my crystal ball. I would be very surprised, but I would say maybe the benefits would be more like "grid stability is good for everybody" kind of a thing.David RobertsYeah. VPPs are great just for their —Lindsey RowellFor their own merits. Right. Just the purpose.David RobertsSo one final question about buildings, which is just something that occurred to me as I was thinking about this, is, are you out building new anything, new campuses or new —? Because I would imagine building new stuff that works for these goals is a lot easier than retrofitting stuff. But are you even doing any new stuff? And is sort of tightening requirements for new stuff a big piece of this?Lindsey RowellYeah, I think we're in an interesting time for that. I mean, we are building new buildings in alignment with our master plans for campuses. Post-COVID, though, I think there's a need to analyze the asset and real estate needs. Are they the same as they were? What is the next generation going to expect with regard to their on campus experience versus their online experience? And then, you know, looking at population growth in California, which has slowed, do we look at building new institutions to serve communities that know rural or have a long commute to a four year institution?Or does that not make much sense? Do we do satellites or do we do remote learning centers? So I think there is a lot of uncertainty there. Not in a bad way, but just in a "Jeez, everybody, this was a global pandemic. What a weird thing to have happened. And now it's brought up all these questions." And then I think the other thing is, there's a very real understanding among our capital team, of which my group is a part, that the most sustainable building is the building that's already built.David RobertsYeah.Lindsey RowellSo all of the folks that I work with, my peers in the executive leadership sort of group, are very aware of this. And instead of being like, well, we're going to just do business as usual. Everybody's really cohesively talking about, do we need to rethink our strategy? Do we need to start thinking about what buildings can be saved? How can we reduce waste?David RobertsRight. Infill, versus sprawl.Lindsey RowellYes, that risk is — the liability that we have. The further out we spread our boundaries in terms of our assets is real. Right. This is all stuff, space that has to be insured. And then we've got space that if it's not serving its function anymore, do we really need to demo it or should it be retrofitted? So, I think that's a conversation we're having, and I think we're probably going to be seeing maybe a shift in how we evaluate whether a new building needs to be constructed versus an old building being rehabbed.David RobertsInteresting. Let's talk a little bit about scope 3.Lindsey RowellNo.David RobertsHonestly, for any institution, scope 3 is a little bit overwhelming and baffling. But for something like campuses, like you say, they are little cities. So, scope 3 involves a lot. The first question is just, do you feel like you have reliable tools to measure and assess scope 3 emissions? Because the whole field around scope 3 emissions seems a little bit nascent to me. What's your take on that?Lindsey RowellYeah, I was just going to say no, I don't feel like we have the tools and go farther to say that anyone that tells you that they do is lying.David RobertsPeople are working on them, allegedly.Lindsey RowellThe colleagues, the folks that I work with, we all sit around the tables going, "What are you guys doing with scope 3? What are you doing with scope — ?" Or somebody called it scope 4, because we've got scope 3, like transportation, and scope 4 is the embodied carbon piece, or scope 3a, whatever. And everybody is just going "Where do you even start?"David RobertsWhere do you begin?Lindsey RowellIt's so massive. The transportation piece is getting a little bit better configured. Although I think the definition of what is our responsibility and what is other people's responsibility and how do we avoid double counting or not counting is still a question. But we're trying to do better on sort of our programmatic elements of that related to alternative transportation and fuels and that kind of thing.David RobertsWell, I mean, if any student at any one of your 23 campuses drives their car to the campus —Lindsey RowellThat's us.David RobertsBoom, you've got some scope 3 emissions there. So you have to theoretically get all however many thousand students. You said some mind-boggling number. You have to get them all to the campuses without driving. That alone is like, how on earth do you do that? I mean, I know you can do some carpool programs, but you don't control public transit. You don't control zoning decisions —Lindsey RowellBoundary responsibility. Well, it's the same thing with embodied carbon. Right? Like, I don't control how lumber is milled and where it comes from.David RobertsThis was my other question, which is, even if you could measure the amount of embodied carbon coming in through building materials, say, that doesn't necessarily mean that there's a source of carbon-free building materials even available to you.Lindsey RowellSo where we are with this now, which is to say, not far. So there are some firms, like, working on sort of software tools to help start tracking this. The state of California does require environmentally preferable purchasing or reporting on construction materials and things like that. So we do do that. The cynic in me is like, is this even close to, like, is this even accurate enough to merit tracking?David RobertsRight, right.Lindsey RowellBut the optimist in me is like, okay, well, we got to start somewhere. So tracking what you're using is a place to start, and then at least you can put rules of thumb to it. Right? Like, how many pounds of steel do we use? How many pounds of lumber, how many pounds of concrete? And as a rule, regardless of where it comes from, what is the carbon impact of those materials, even though the specifics of where they come from and how they're milled and all that stuff has an impact, it at least gives you some framework to start from, because where it is right now is just like pulling numbers out of the damn sky. Just don't know.David RobertsThere's a lot of dreamed up numbers in that general vicinity.Lindsey RowellI mean, for organizations like mine, or ours, not mine, right.David RobertsDo you even have the staff? Do you have the staff to do this?Lindsey RowellExactly. Like, the administrative and transactional costs associated with tracking that information is — I couldn't even begin to. You could have someone in every unit for every project doing only that. Only that.David RobertsYeah. Really seems like a place where you really badly need better tools, like standardized, off the shelf.Lindsey RowellVery, very much. I feel like this is a supply chain matter, right, ideally. But because it doesn't work to rely — we have to try and take responsibility on our own. We can't force industry to make these adjustments.David RobertsIt does seem like, though, especially in scope 3, you are, to some unavoidable degree, dependent on developments that you have no control over. Right. Like what the state does or even what the federal government does.Lindsey RowellRight, so at this point, it's more about just understanding what we use. When we feel like we can track that with some degree of accuracy, we'll feel like we've made a tremendous success. We are including scope 3 as part of our carbon reduction.David RobertsThat's crazy; that's just crazy.Lindsey RowellI'm going to retire before all this.David RobertsIn your mind's eye, when 2045 rolls around and CSU is carbon neutral, how are people getting to school? What does the zero carbon, just the transport alone, just the transport angle alone, what would it look like for that to be truly carbon free? No more gas cars, I guess. No more gas cars on the street.Lindsey RowellWe have the best chance of it in California, right. Like we're moving away from petrol, as it were, in California. So my thought is that if things were to go my way, it'd be a combination of things. Obviously, where — we have good public transit, we have good programs for students, shuttle systems and stuff that aren't necessarily related to the community programs, regional transit and things like that, that we have a little bit more control over, and then electric vehicles and mobility devices which have their own issues. I mean, we've got concerns related to lithium ions, and everything is a rabbit hole but —David RobertsOnce you scope 3 it, all of a sudden, EVs are not as uncomplicated as they seem.Lindsey RowellExactly. And I think the other combination with that is, do we have students coming to school when they don't need to be?David RobertsRight.Lindsey RowellLike, are students coming to school for classes where they really don't need to be? Could you be doing this class once a week instead of three times a week, and the rest of the class is held online? I don't know the answer to that. I don't know that that is the answer. But I think all of those avenues need to be investigated so that we understand what students need, what they want, and how we can meet these goals while giving them both of those things. The college experience that they want, and the education they need. Think about how much reduction that would be to just have someone for one class going, well, I only have to come to campus one day a week.David RobertsYeah. That's an easy lever to pull. For sure.Lindsey RowellYeah, for sure.David RobertsOne can imagine ways of decarbonizing that do not serve resilience, that leave campuses sort of brittle or vulnerable. Talk a little bit about just the effects you've seen of climate and severe weather on your campuses and how you're thinking about resilience as part of decarbonization.Lindsey RowellWell, so this is such a hard question because we just had fairly recently in California a hurriquake. Have you heard of this?David RobertsNo.Lindsey RowellNew weather phenomenon.David RobertsOh, good. Have fun.Lindsey RowellOur campus, San Bernardino, out in the inland empire, was hit by torrential rains from a hurricane. At the same time, there was an inland earthquake — and they had like four inches of water on their gym. And they're out in what we would refer to as kind of the low desert. They're not in a place where you think of flooding exactly. You definitely don't think of being impacted by a hurricane. And then they also suffer the wildfires from sweeping through the valley there. Poor campus. We use them as an example. And they're such good sports about it, but so there's that.And then, like I said, we had a couple of days ago, now I've got phone calls out to our campuses in San Jose to see if their Moss Landing Institute was impacted by these waves coming in off the coast. They've got research right up butted up against the ocean where they impacted by that? So wildfires and public safety shut offs are the main impacts. Right. And then, of course, drought across California because this is a desert state, most of it. And we go through decade long periods of drought. One of the things we're trying to do is we've developed a resilient infrastructure guidelines model.So it's a tool to allow campuses, when they're planning projects and capital construction to think about their designs in terms of the resiliency hazards, potential climate hazards and resiliency impacts their campus might face as a result of where they are geographically, their age, the condition of their infrastructure, so on and so forth, and then use that for those projects, but then also for their utility master planning efforts and their critical infrastructure reports to kind of help prioritize how they should be looking at their infrastructure upgrades. Because if you're a campus that has been experiencing drought, you're not necessarily going to think about prioritizing your stormwater plan, stormwater infrastructure. But if you don't and you find out that three other institutions in your immediate area have had massive millions and millions and millions of dollars worth of damage and shutdown resulting from water intrusion because they didn't have a good stormwater infrastructure. Maybe you need to be thinking about that a little bit more.That needs to be bumped up the priority list, perhaps more. So that's one of the tools we're using. It's actually pretty sophisticated and we've been working on it for a couple of years, and then it's intended to stay kind of a living document because the climate is changing.David RobertsIndeed.Lindsey RowellUniversities are changing.David RobertsYeah, that's truly a moving target. I've burned up all my time, so I don't have time to talk about food. But obviously I feel like I should at least mention it because among all the many other things that you have to worry about, once you're talking about decarbonization and scope 3, and everything else is food incoming food service, food waste. Could you give us like a one or two line how you're thinking about food, answer?Lindsey RowellI can summarize food by saying it is almost as difficult as scope 3.David RobertsInteresting.Lindsey RowellYeah, we should talk about this at another time. We can get into some of this, David, but it is tremendously difficult. It's another thing that crosses those boundary lines. And then the one thing that I think people in your audience definitely will not know is that the way most, this is true of most universities, not just ours, is that the way food works on their campuses is through auxiliary services, meaning they have contracts for food providers through their 501(c)(3).David RobertsRight. So once again, you're dependent on, you need someone to provide carbon free food service or else what can you do?Lindsey RowellRight, right. And then you've got all the safety policies. Right. Because we spend a lot of time on the food waste side, too, going, okay, we have students who are food insecure and you're going to throw away all this food from some box lunch thing, can we give it away? And you got to go through risk management for all that. Like everything else, it's just a rabbit hole. And that is. Oh, man, that is a tough one.David RobertsInteresting. Yeah, it's something that I think my sort of like, energy nerd world crowd doesn't think about a ton. Same with kind of agriculture.Lindsey RowellYeah. Interesting to see how they cross.David RobertsFinal question here is, just as I said earlier, it is sort of, I don't know, like amusing and poignant to me to imagine you sitting in your office thinking about basically how to transform a decent chunk of the state in the next few years. So you've been given this mandate, which, you know, thanks a lot. So what when you think about California politicians now and regulators, what do they not get? And if you had to sort of prioritize a couple of things that you would ask from them besides money, like give me some money, obviously. But in terms of law or regulatory support, are there a couple of top line items that would make your life easier?Lindsey RowellYeah, I think the government really needs to facilitate partnerships a bit more. I don't know that any one organization like ours, or even the UC, which is obviously a huge and well recognized, world renowned organization, has an easy time developing relationships with nonprofits, with commercial interests, supply chain groups, and those partnerships are imperative. And I think the thing that frustrates me with the money question is, the money is out there. We know it exists; like, the actual physical pieces of paper are available. And I tend to think that there's probably a lot more interest among the community, be it business, be it private philanthropy, anywhere, that they would like to know how they can help, how they can be a part of this.And I don't feel like the government does anything to try and facilitate those partnerships. And so we're all sort of feeling around in the dark in this room, trying to find who we are and then also not waste each other's time. Right. Do I have what you want? Do you have what I want? There is some organization that could happen here that I think would be really helpful —David RobertsAre not duplicating efforts. It seems like there's got to be lots of big organizations that need roughly the same things you need.Lindsey RowellAnd there's services, there's firms that do this kind of work, certainly, that have a lot of these contacts. But for organizations like the community colleges and the CSUs, they don't have the funding to go out and hire people for these sort of theoretical connections. So I would really like to see, other than the money — don't forget the money — but other than the money, sort of that. And then also related to these programs, just streamlining, what do you, as a legislator and your aides and the people within the organizations over whom you are responsible, what do they really need to see?Are we doing reporting? Are we punching numbers? Are we investing time and staff and money in information that you're never going to look at, is never going to get verified? It's not useful to anybody. And can that be simplified?David RobertsYeah, a lot of it. Just about. It seems like communication between legislators and regulators and people like you who are out in the implementation swamp, better communication would be a great thing.Lindsey RowellYes.David RobertsThank you so much, Lindsey. This is just fascinating. Like decarbonization in general is just a giant puzzle, and every little piece of it is a puzzle, but you've got your hands on a really big piece of the puzzle. So I'm sure it feels overwhelming and slightly ridiculous what you're being asked to do. But I will say it comforts me to know that there are people like you out there really doing the ground, the block and tackle work of making this happen.Lindsey RowellYes, it's comforting to me to know that there's people like you out there spreading the word that this work is going on.David RobertsOh, good. Well, we've comforted one another in the storm.Lindsey RowellThe marginal success of the day.David RobertsBeautiful. All right, thanks so much, Lindsey.Lindsey RowellThank you, David.David RobertsThank you for listening to the Volts podcast. It is ad-free, powered entirely by listeners like you. If you value conversations like this, please consider becoming a paid Volts subscriber at volts.wtf. Yes, that's volts.wtf. So that I can continue doing this work. Thank you so much and I'll see you next time. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Will Toor of the Colorado Energy Office shares about the state’s ambitious climate agenda and the array of energy policies they’ve been passing under a Democratic political trifecta.(PDF transcript)(Active transcript)Washington, DC, is a slow-motion nightmare right now, but out in the states — at least the states that Democrats control — climate and clean energy policy is still happening. A few weeks ago, I covered the fantastic policies recently passed in my home state of Washington (see also my podcast with Washington legislator Joe Fitzgibbon). Today, we turn our gaze to Colorado.In 2018, Democrats gained a trifecta in the state — the governorship and both houses of the legislature — for the first time since 2013. They promptly got busy passing a vast array of clean energy policies: reform of electric utilities, support for electric vehicles and charging infrastructure, new restrictions on oil and gas production. During this year’s legislative session, Gov. Jared Polis released a comprehensive roadmap to 90 percent statewide reductions in greenhouse gas emissions by 2050 and the state legislature tackled clean buildings, industry, environmental justice, reform of state transportation agencies, reform of natural gas utilities, and on and on. To discuss this flurry of activity, I turned to a man who has been involved in Colorado politics since the previous century: Will Toor.Toor was mayor of Boulder from 1998 to 2004. From 2005 to 2012, he was Boulder County Commissioner. During all that time he was also board chair at the Denver Regional Council of Governments, where he led efforts on climate policy. He then became director of the transportation program at the Southwest Energy Efficiency Project, until 2019, when the newly elected Polis appointed him to run the Colorado Energy Office.Toor has had a hand in shaping Polis’s energy agenda from the beginning, and he has been closely involved in negotiating bills through the legislature. He helped walk me through Colorado's sector-by-sector approach to emissions, what the state has accomplished so far, and what might be next for it.Listen, enjoy, and if you appreciate work like this, please consider becoming a paid subscriber to Volts.As a bonus, here’s a picture of Toor in 2003, as mayor of Boulder, hosting visiting scholar Noam Chomsky.Text transcript:David RobertsAll right, with no further ado, Will, welcome to Volts.Will ToorThank you.David RobertsSo I've been following states and climate policy for a long time, and it seemed like a few years ago, Colorado just kind of burst out of the gate at a full gallop and has been going really strong now for two sessions of the legislature. So maybe just by way of starting, tell us some about the political developments of Colorado over the last five years that put all the pieces in place that allowed this burst of activity.Will ToorYeah, really, I think what happened was that in 2018, we both elected a new governor, Jared Polis got elected governor on a platform of, among other things, 100% renewable electricity by 2040 and bold climate action, and we elected a Democratic Senate. We had had a Democratic House, but had not had a Democratic Senate since 2014. And so the combination of having a governor who was committed to climate action and a House and a Senate that were aligned and the fact that there was just kind of a pent-up demand for action on climate and clean energy really set the stage for a kind of monumental legislative session in 2019.So that year we had, depending exactly how you count it, something like 15 major bills on setting climate targets, modernizing our utility regulation to set our utilities on a pathway to at least 80% greenhouse gas reductions by 2030. A bunch of bills on electric vehicles, a bunch of bills on energy efficiency. We had a major oil and gas reform bill. One of the things that's a little unusual is that Colorado is a major oil and gas producer that is actually acting on climate and clean energy. And Senate Bill 181 completely rewrote the regulatory structure for oil and gas in Colorado.Then last year was a little bit quieter because of the pandemic that kind of shut down our legislative session partway through, although there was still lots of action at the Public Utilities Commission and the Air Quality Control Commission. But then this year has really shaped up to be another year where that kind of pent-up demand for action really came out at the legislature.David RobertsWell, I want to get into some of the specifics of the legislation, but just as a background political question, because I'm curious. Do you have a supermajority of Democrats or does Colorado — do you need a supermajority to sort of override Republican objections or sort of like, what's the disposition of the state Republican Party on all of this? Are they just irrelevantly sitting on the sidelines, or is there some engagement? What's the degree of Democratic domination, I guess, is what I'm asking.Will ToorSo, there's a large Democratic majority in the House. In the Senate, it's a much narrower majority. For 2019 and 2020, it was actually a one-vote margin, 18-17. After the 2020 elections, it's now a 19-16 margin. I would say that some of the issues have been bipartisan, but the vast majority of votes on clean energy have been primarily Democrats. There is one Republican in the Senate who is a very strong advocate for clean energy and climate action, Senator Kevin Priola, who has actually been a sponsor of many of the pieces of legislation. Where the Republican Party, I think, has had an impact has been often helping to shape some of the pieces of legislation in ways that may make them work better for their communities.They often represent rural parts of the state, and there's been a lot of interest in trying to make sure that we're moving forward on climate action in ways that can work for rural Colorado in addition to the urban part of the state. We had one major bill this year on funding our just transition effort for coal communities, and that was a very bipartisan bill.David RobertsRight, I bet.Will ToorYeah.David RobertsSo one thing that happened this year, I think prior to most of the big bills, is the governor issued his roadmap. This is a sort of roadmap whereby Colorado can reach its goals. So tell us what the targets are and sort of what is the roadmap, what was the purpose of the roadmap?Will ToorYeah. So this really came out of that 2019 legislative session. One of the pieces of legislation that moved forward for the first time created legislatively adopted GHG targets for the state of a 50% reduction below 2005 levels by 2030 and a 90% reduction by 2050. And the governor asked the energy office to convene the other major state agencies that were engaged on this — our Department of Public Health and Environment and Transportation and AG and Natural Resources — and do both a technical analysis and a stakeholder process to basically develop the strategic plan for how are we actually going to achieve the targets that we had adopted?We worked with Energy and Environmental Economics, E3, a consulting firm that's done scoping plans for a number of states over the years, and really developed a plan that was very much focused on what was achievable in each one of the major emitting sectors in the state. So transportation, electricity generation, the oil and gas industry, residential and commercial fuel use, and industrial fuel use and process emissions. Those really dominate our emissions as a state. And we developed sectoral targets and near-term action steps for each one of those areas.David RobertsRight. Maybe it would be helpful, I think, to tell listeners what is the share of each of those, like, what are the big categories to the little categories of emissions sector-wise.Will ToorSo, interestingly, if you look at transportation, electricity generation, the oil and gas industry, and then fuel use sort of combined in buildings and industry, each one of those is fairly similar. They're each around a quarter of our emissions. Transportation is the largest single source, but by a pretty small margin.David RobertsAnd it just edged ahead recently. Right. Which is the same thing that happened nationally.Will ToorYeah, basically, electricity has been decarbonizing faster than any other sector, so it used to be our largest, especially because Colorado has traditionally been a heavy coal state. Oil and gas, it depends a little bit on how you count things. So the way that we count it, the emissions of methane from the upstream oil and gas industry are one category, and then the combustion emissions that they have from the processing of oil and gas actually fit within our industrial sector. If you put those together, oil and gas would actually be the largest single source. So there's different ways that you can parse it.But the way that we generally parse it is transportation is the biggest, followed by electricity, followed by oil and gas, and then industrial and buildings.David RobertsOkay, well, let's start with electricity, because in some ways it's kind of the most straightforward. I think the policy instruments are sort of the most well understood. The road ahead is well understood. So what are the big things Colorado is doing on electricity? I know. Obviously getting rid of coal has got to be step one, right? Or at least phasing it down.Will ToorYeah. So essentially, again, coming out of 2019, we had an interesting sort of legal and regulatory structure where our largest single utility, Xcel Energy, which accounts for more than half of the generation in the state, had a voluntary commitment to achieve 80% by 2030. And we worked with them to write it into statute. So, they were legally required to submit a plan to the Public Utilities Commission to achieve 80%.David RobertsJust them or all utilities?Will ToorWell, the way that we structured it, they were legally required. Other utilities weren't technically required, but we gave a broad grant of authority to the state Air Commission to regulate them, but said that if they submitted a plan to the Public Utilities Commission that would achieve 80% by 2030, then they would have a safe harbor from additional air regulation until 2030. We then went out to every utility and said, "wouldn't you rather just do this on your own terms rather than us have to create a mini clean power plan for the state?" And essentially all of the utilities said, well "yeah, that works for us."And so we're in a place where for other utilities, they have all voluntarily come forward with plans. We've since passed legislation that actually puts an additional regulatory piece in place. And so there's now legislation that says that if any utility did not come forward with a plan, the Air Commission within nine months would have to adopt rules requiring them to get to 80%. But we're in a place where all these plans are just moving forward and it's been pretty remarkable to see our second largest utility, Tri-State Generation and Transmission is a G&T cooperative who provide the electricity for most of the rural co-ops in the state.David RobertsRight.Will ToorThey are historically very coal heavy.David RobertsYes, I was going to ask. They're legendarily problematic in all states.Will ToorYeah. They not only owned multiple coal power plants, they actually, in some ways, were a vertically integrated coal company in the northwestern Colorado. They owned a coal mine and had mine mouth power plants. And in the past, you know they were funders of climate denial at the national level. Their prior CEO was kind of legendary for a conference where he stated that, to sort of pull from the NRA, "you'll pry our coal plants out of my cold dead fingers." That completely changed in 2019. So that CEO was still the CEO when I started this job. When I came in with Governor Polis in January of 2019, by April they had new leadership.That new leadership came in to meet with me to talk about "how can I work with the Governor's office to help meet his clean energy goals." And by January of the next year, Tri-State had adopted a plan to close every coal power plant they have in Colorado and New Mexico to reduce in-state emissions 90% by 2030. And they have since submitted a plan to our public utilities Commission that would achieve 80% reduction in emissions serving retail loads. So, including the electricity they're importing from Wyoming and Arizona. Xcel recently filed their clean energy plan, and they're exceeding the minimum requirement.They're proposing approximately an 85% reduction. Our municipal utilities, one of them adopted a plan to get to 80%, another a plan to get to 90%.David RobertsHow much of all this is just going to be shutting down coal plants? I mean, I guess it's kind of the low hanging fruit. Is that the bulk of where most of this is coming from?Will ToorYeah, it's basically shutting down coal plants, adding a whole bunch of utility scale wind and solar, and a fair amount of distributed generation, adding a fair amount of battery storage, and backing it up with gas combustion turbines. There is a little bit — we have one utility, somewhat smaller, rural utility, but it's very progressive, Holy Cross Energy, who are committed to 100% carbon free by 2030. And they're doing a lot that's focused on demand flexibility, and a lot more on storage. But at the large scale, it's really shutting down coal, replacing it with renewables.David RobertsAnd renewables have gotten crazy cheap in Colorado specifically. Right? I mean, cheapest I think.Will ToorYeah, we're lucky in that we have both a good solar resource and a good wind resource. Back in 2018, a whole lot of heads turned when Xcel did their all-sources solicitation, and they were getting back bids for wind that were coming in at under two cents a kilowatt hour. And they were getting solar with storage for under three cents a kilowatt hour. And that's a lot of what's enabled this transition, is the fact that you have all these legacy coal plants that cost four, four and a half cents a kilowatt hour for operations and maintenance.It becomes a pretty easy decision to replace that with two cent a kilowatt hour wind.David RobertsWell, this actually raises another thing that happened to utilities in Colorado, I think it was this year, but they're all going to join organized markets, RTOs. What's the story there?Will ToorYes, so there was legislation this session, Senate Bill 72, that is really going to push the state towards an organized market. It both creates a transmission authority and encourages a larger buildout of transmission, not only within the state but also connecting to larger markets. It effectively requires that by 2030, our utilities join organized regional markets. It's not an absolute requirement if our public utilities commission were to find that it wasn't in the public interest or that it would somehow get in the way of meeting our clean energy goals. So it's not a 100% requirement, but given the fact that it should give us greater access to wind to the east and solar to the west, and more of an ability to average renewables over a larger area, it certainly seems very likely that it will move forward.David RobertsWhat RTO would they be joining?Will ToorSo the bill does not specify. You can look east towards the SPP market or you could look west towards ultimately Cal-ISO.David RobertsDo you know if there are, I don't want to get on a diversion, but if there are other western states that are — because this has been talked about for ages, trying to get a western market started, do you know if other states are as close as Colorado to kind of making that jump?Will ToorSo I think that there is a strong movement across the western states. You know, I don't know that people are quite ready to make the jump. There's a multi-state study that Colorado is part of that Utah is actually sort of coordinating that's looking at options. There's legislation that I think is being proposed in other states very similar to the legislation in Colorado. So I think there's a lot of interest and there's certainly a lot of discussions taking place but there's a lot of complications in getting from here to there and doing so in a way that works financially for customers and for the utilities and that ensures that the clean energy goals of the different states are honored.One of the issues that we face is there's some pretty different politics among the western states.David RobertsYes. Both of which are leery about the politics of the other.Will ToorAs a sort of interesting digression. One of the pieces of legislation that got a fair amount of play in the Colorado press from our fellow state, Wyoming, this year was when they created a fund of $1.2 million to sue other states for not buying —David RobertsI heard about that. I'm just going to assume that that has very little legal merit.Will ToorYes, I don't think that I would be very concerned with it. And the truth is we have a fine relationship with Wyoming and I don't anticipate there will be any litigation.David RobertsYou don't anticipate being forced by the Supreme Court to burn Wyoming coal? Okay, so electricity is awesome but in some sense kind of straightforward. You're going to close down the coal plants, you're going to ramp up your renewables, you're going to build a bunch more transmission, you're going to get utilities oriented in the right direction, get them in a market that seems all sort of tidy. And doable other sectors are more complicated. Let's talk about then industry. Sort of industry is known as one of the difficult to decarbonize sectors or at least less certain how to decarbonize.What's the Colorado approach to industry? And it's kind of a side question how much of what counts as industry in Colorado is just the fossil fuel industry such that it will disappear when fossil fuels disappear?Will ToorSo if you look at our kind of industrial inventory, I think right now it's about 15 million tons a year, and I think about half of that is really the combustion emissions associated with the midstream oil and gas industry. The other half are a refinery that provides a lot of the liquid transportation fuels on the Front Range, the Suncor refinery, it's the steel mills or the steel mill in Pueblo, although that steel mill now has a 250 megawatt onsite solar plant providing a large part of their electricity. Cement facilities; we've got a couple of large cement plants.We also have semiconductor like chip factories and then a lot of smaller industry that contributes also. And I would say there's a couple of different pieces that are moving there. So one is on the regulatory front; the target that we adopted in industry for 2030 is not nearly as aggressive as it is for electricity. So we're going 80% in electricity. We're headed for a 20% reduction in industry and that's a 20% below 2005 level. So it's a larger reduction from today because emissions have grown over time. But it's certainly what we see as being possible in the industrial sector is not as deep as the technology and economics allow on the electricity side.There are a series of rulemakings that are moving forward at our State Air Commission. There's one happening right now that's focused on our trade exposed, energy intensive industries, basically steel and cement. And then there will be other follow up ones over the next two years. Under legislation that just passed, there's a statutory requirement that by the — I believe it's the end of 2023 — rules need to be in place that assure will get to that 20% by 2030. The other piece that's moving forward is we're seeing a lot of activity on the carbon capture and sequestration front, which is interesting because this was something that we did not pay a lot of attention to in our first draft of the roadmap.Basically our analysis said, "okay, this is something that may be important post 2030, but we don't think we're going to see a lot of it in the near term." But then we started hearing from all of these industrial players who were working on developing projects, and we ended up not setting any target in the roadmap for what we needed in carbon capture by 2030, but instead putting together a carbon capture task force that's meeting this year and is going to come back to the governor and legislature by the end of the year with recommendations about what we should be doing on carbon capture. The big project that has a lot of momentum right now is actually at one of our cement plants, the Holcim cement plant or Holcim-Lafarge cement plant in southern Colorado. The town of Florence is working with Oxy Low Carbon Solutions on a carbon capture project for that cement plant. And they've done an initial feasibility study, they're now in a more detailed engineering study —David RobertsTo do what with the captured carbon though? What's to be done with the carbon? Are they going to bury it or are they going to try to use it somehow, or do they know?Will ToorSo I think it's a little bit of an open question. One of the things that we have in Colorado are a lot of saline formations that are actually geologically good places for sequestering carbon. There's also a carbon pipeline that crosses southern Colorado. So they would potentially have the option of using it for something like enhanced oil recovery, which is probably not — from a state perspective, we're probably a lot more interested in seeing it sequestered than seeing it used for something like EOR. We're also seeing a number of other projects that are smaller scale that are also in their sort of feasibility analysis side.So I think it's fairly likely that we're going to see some meaningful scale carbon capture projects move forward. And as a state over the next year, we're going to need to figure out what role do we see this playing in meeting our targets. How do we look at something like EOR versus true sequestration?David RobertsYeah, that's so tricky. That's so tricky from an accounting perspective, political perspective, you name it.Will ToorOne of the things that's interesting is in terms of scale, if you think about the 20% reduction that we need in the industrial sector, so we're talking there something like a 3 million ton reduction. I think that the scale of capture that they're talking about in just that Holcim project could be on the order of a million tons a year. We're potentially talking a significant role there. We're early in our task force process. We won't have recommendations to the governor until the end of the year. But at the very least, it's intriguing to really start understanding what some of the opportunities may be there.There's also, I have to say, a really interesting project that is moving forward sort of independently of the state in southern Colorado. The Southern Utes are historically producers of methane, kind of coal bed methane. They've got a natural gas industry and they are working on a proposed project that would be an Allam Cycle gas plant.David RobertsOh yeah, yeah, yeah.Will ToorWith, I think, saline storage and saline formations on the reservation. And they're looking at a fairly large — like their proposed plant, I think is a 350 megawatt plant. And we weren't really anticipating that that type of low carbon firm generation might be coming during this decade. But again, we're seeing independently a project moving forward that is very interesting.David RobertsYeah, that's such an interesting X factor. The Allam Cycle would be a great thing for Colorado to stake a claim on.Will ToorYeah.David RobertsOkay. That's industry next is the source of a lot of action and excitement. This particular section, which is buildings, this is, again, a much less straightforward area in terms of mechanics about how to get at these emissions than electricity or something like that. Review a little bit about I mean, there were multiple pieces of the buildings pushed this session. What all did you guys do?Will ToorYeah, no, this one is really exciting, and this is one that I would say has been really interesting because some of the advocates have argued that we need to focus on sort of enforceable air regulations that somehow would decarbonize buildings, and we really couldn't figure out what that looked like. But what we did come up with was a series of strategies in the roadmap that all of which amazingly moved through the legislature this year. We had, I would say, four major bills that moved forward. Three of them are sort of tools, and then one is the overall organizing principle that allows those tools to be applied.The tools were first, a beneficial electrification bill that requires our electric utilities to create electrification programs that are analogous to their energy efficiency demand side management programs, requires the Public Utilities Commission to set targets for those programs based upon all cost effective electrification. And it builds into that cost test the social cost of both carbon dioxide and methane emissions avoided, and requires the use of a discount rate of under two and a half percent. So it pushes you to the higher number from that 2016 interagency study, the same one basically that State of Washington used. So it starts at about $70 a ton for carbon dioxide in 2020 and, I forget, I think around 1400 a ton for methane.We think that that will drive significant investment in electrification.David RobertsAnd when you say electrification programs at utilities, you just mean sort of like incentives for heat pumps and things like that?Will ToorYeah. So on the residential commercial side, we think it would be primarily heat pumps and heat pump water heaters, and then they could also be doing things on the industrial side, where there's a wider variety. It also allows them to create programs to support new all electric construction. So that's one piece. Another piece focuses on the gas utilities and it basically expands existing gas utility energy efficiency programs. Right now we've got pretty large electric utility programs and quite a bit smaller gas utility programs. And what this does is it takes that same social cost of carbon and methane, builds it into the cost test, and then requires the PUC to set targets based upon all cost effective energy efficiency measures.So we think that will drive substantial additional investment in upgrading existing buildings. Third thing: piece of legislation focused on commercial buildings. Again, this may sound a little bit familiar from Washington state. We looked at some of the successful efforts there two years ago, and it requires both benchmarking of energy use by those buildings, and then it sets rulemaking at our State Air Commission to adopt performance standards for existing buildings that require that the sector as a whole needs to achieve at least 20% reduction in emissions below 2005 levels by 2030. And so that's including all of the growth in the number of buildings since then, the entire sector has to get to that 20%.And amazingly, on that one, it actually ended up being something approaching a consensus bill. It wasn't just the environmental community —David RobertsI thought real estate and builders hate that stuff, what you pull on them?Will ToorSo we just worked in good faith with all the parties. We agreed to create a task force that has significant representation from building owners of various sorts in developing the proposed performance standards. But the legislation specifies what the performance standards have to achieve, and so we need to certify that those standards will achieve the 20% by 2030. But it was endorsed by the Building Owners and Managers Association and by NIOP.David RobertsWow.Will ToorAnd labor was on board with it. That's one thing that's been very important to us is to make sure that we're moving this forward in a way that helps provide good jobs. We're making sure that any utility funded programs or high labor standards — I think it's very important to us, both substantively and in terms of holding a broad coalition together to do this in a way that works for labor and that assures that we're helping to create good jobs as we go forward. We also really wanted to avoid the kind of sort of existential battle over building electrification we've seen in some places, that we saw tank legislation this year.David RobertsBreaking out all over. There's running battles all over the country now on that stuff.Will ToorAnd that sort of feeds into then the fourth big bill that sort of pulls us all together, and which is, I think, the real innovation here. Senate Bill 264 that we refer to as the Clean Heap Standard Bill, sets carbon reduction requirements for our gas distribution utilities. And it includes in their carbon emissions, the emissions from combustion of gas by their customers. It again is aligned with our roadmap targets in that sector. So it's a 22% reduction by 2030. They're allowed to use multiple measures so they can do more energy efficiency, they can do more electrification, they can inject hydrogen into their gas lines, they can reduce leaks on their distribution system.And we allowed limited use of what some people call renewable natural gas. We refer to it as biomethane and recovered methane.David RobertsDoes that mostly come from agriculture in Colorado, or landfills or what? Where does that come from?Will ToorSo, there will be landfills, sewage treatment plants, agriculture, especially some of our dairy farms. The other place where I think there is an opportunity is there are abandoned coal mines in western Colorado that are just pouring methane into the atmosphere. And as of now, there is only one project in the state that is capturing and using that methane. So there's a number of opportunities there. The way it's structured out of the target, they can reach about a quarter of the target through the use of recovered methane or biomethane. And the rest of it has to happen from sort of on-system reduction.David RobertsWell, I have a question about this. For utilities that are electric and gas, this seems kind of straightforward. Like you just shift from the one to the other, right? Shift from natural gas to electricity would be your main tool and you're fine with that. But for natural gas utilities that are just natural gas utilities, I see the road to these 20%, 22% reductions through these kind of bricolage efforts: efficiency here, reducing leaking there. But you don't get to zero with natural gas. If you're a natural gas utility, the end of this story is you going out of business, is it not? Or how are natural gas utilities viewing all this?Will ToorSo a couple of things I'd say there. So we did structure this around there's the near term target of the 22% by 2030. The legislation also has the 90% by 2050. Sets future rulemaking proceedings for setting targets for 2035, 45 on that road to 50. So at one level, I would say people are focused on the next decade. And the way that we've framed it is that none of us really know what the ultimate solution is going to be. Some people think they know. There are certainly folks who argue that the solution is obviously full building electrification and maybe they're right.There are others who argue that we're going to figure out a way to do air capture of carbon induced synthetic methane and it will be using that or that we're going to get to a point where we can use higher percentages of carbon or of hydrogen than we think we do in the pipes. We're not trying to answer that question today because a) we don't feel like we have enough information to really answer it. The truth is, nobody has really done the level of analysis that would be required in Colorado as a cold climate state to answer: What would it really mean for us to fully electrify, what would it mean for our electric grid?Nobody really knows how some of these other technologies are going to pan out and we don't need to answer that today. So we intentionally structured something that allows us to use multiple measures today. It allows the utilities and customers to gain experience with all of these things. It's going to, I think, lead to a big increase in the use of heat pumps in Colorado and allow us to get real experience with using cold climate heat pumps and working out all the kinks and figuring out how do you get high levels of customer uptake. It will allow utilities to see what they can do in terms of making recovered methane and biomethane affordable at scale.And then over the next decade, I think we will need to answer some bigger questions about, "okay, what does it really look like post 2030?" We're not trying to prejudge those answers. And because of that, we were able to have a broad coalition that supported this legislation. Our largest gas utility, Xcel Energy, is a dual fuel utility. They actually supported the legislation other utilities were not necessarily actively supporting. But I believe in the end there were no utilities that were actively lobbying against the legislation.David RobertsOh, interesting.Will ToorAnd, you know, I think that we had all had the opportunity to watch what happened in the Nevada legislature this year where there was a sort of similar effort, but one that I think perhaps was not as focused on building consensus among multiple parties. Our sense is that we're a lot better off trying to do it the Colorado way and get as many people as possible on board, learn from it, and then we'll figure out what the next steps are.David RobertsRight. So for buildings, then you have an overall greenhouse gas reduction, target-specific boosts for energy efficiency and electrification specific targets for reducing gas, specifically gas emissions and energy performance standards. The one thing that seems to be missing is building codes. Have you tackled those or addressed those yet or what's the deal with that?Will ToorSo that's very much on our agenda for the next big thing we need to do. And we did some work on this in 2019. Colorado is a state that's traditionally a local control state on building codes. But we were able to do legislation in 2019 that put certain minimum standards on local energy codes. But it needs to be updated. It's not aligned with where we need to be to achieve our 2050 targets. And so this is something we called out in the roadmap. We didn't have the bandwidth to do that in addition to everything else this year.But I'm certainly hoping that we are going to have some vigorous stakeholder conversations over the next year and come back to how do we move forward on building codes in a way that aligns with where we need to be if we're going to have decarbonized buildings that get us to 90% or more by 2050.David RobertsAll right. Well, let's then hit the last one, the biggest one in Colorado and probably the biggest source of controversy and the biggest source of angst in climate policy generally, namely transporation.Will ToorOh, just before we jump to that, could I throw one other, which is oil and gas? In other places, may not be so big, but for us a really big part of our emissions is methane leaking from the oil and gas upstream operations. And that's one where the stars are kind of aligned, where there's real opportunities to reduce those emissions. Some of it is driven by sensing technology. There's just much better ability to actually monitor emissions than there used to be. And that means that you can actually regulate them and you can reduce them. And so we've got a target in the roadmap of at least a 60% reduction in methane emissions and that is moving forward in a rulemaking process at the Air Commission that the stakeholding is happening right now.It will be go to the Air Commission for adoption later this year and legislation that was just passed puts that into statute. So the Air Commission rules have to achieve a 60% reduction. It also requires every two years an inventory process to make sure that we're on track and requires additional rulemakings to get there if we find that sort of the real world emissions aren't on the trajectory that we think they're going to be.David RobertsIs part of the thinking behind this. I mean, this is a national problem and it's a long standing national problem, these leaks. And the industry has traditionally not been very helpful. They've demanded voluntary standards and et cetera. Is part of the goal here to sort of kick start this work and figure things out in such a way that they can be kind of exported like these sensing technologies and just ways of doing this or is it that we already know how to do it pretty well and they're just not doing it well?Will ToorThe way that I would describe it is, back in 2014, I think, Colorado adopted our first round of methane regulations, and those did become the model for the national rates that the Obama administration adopted. The Trump administration unadopted them, and they are being reconsidered. So, you know, we certainly would hope that what we're doing here could help to inform a national standard in the future. To some extent the way that we arrived at our targets was we looked at what sort of the leading oil producers with ESG commitments were saying they could do, and we said, "Well, great, just like we worked with Xcel to take their voluntary commitment and put it into the statute. We take you at your word."David RobertsCall your bluff might be another way to put it.Will ToorNo, I would say we take you at your word and we agree that the technology has evolved to the point where this is possible. And we are going to work with you to come up with a workable set of regulations to ensure that we achieve those targets and that all of the industry achieves the targets that those with ESG commitments have made.David RobertsOkay, so oil and gas leakage, a huge problem in Colorado and some other states, is being legislated as well. So we can't avoid it anymore.Will ToorTransportation.David RobertsLet's talk about transportation. The thing that grumpy environmentalists say in response to almost every state sort of climate action plan or set of legislation — they said the same thing in Washington. It's fine and dandy to do all this, but you're also spending a bunch of money on roads, you're also widening a bunch of highways. We all know, everybody knows now it's been proven a trillion times that widening roads doesn't help anything, doesn't reduce congestion.It just leads to more cars on the road and more pollution. So maybe say a little bit about the broader transportation context and how you think about that relative to steps you've taken. And then let's hear about the steps.Will ToorSo transportation, as we noted, is now the largest single source of emissions in the state. Just barely, but it's definitely a big one. And we face the same issues that, as you noted, kind of every state that is working on this does. Transportation is a really challenging sector to work on because it involves the decisions of millions of people about how they're going to get around. It is very much influenced by land use decisions that are made by local governments that include both the decisions to build very dispersed development that puts housing very far away from jobs, and the decisions by other communities to enact exclusionary zoning that doesn't allow housing near the jobs.We have a tradition of local governments having a lot of flexibility to make those decisions. And even more than building highways, that's the big thing that really drives the vehicle miles traveled.David RobertsI was going to address that later, but let's talk about that now because this is the big missing piece in all climate plans. Right? And it's like — we know from research that density, walkability, transit is one of the best and necessary ways to reduce transportation emissions. You can switch out cars for electric vehicles, but you still are left with a bunch of the problems of cars, a bunch of the long commutes, the other kinds of pollution, just the general unpleasantness. So do state governments have any instruments or tools whereby to impose some sort of reason or some sort of positive direction on those local decisions? How do you think about that?Will ToorIn the Colorado context, I think the way that I would frame it is: One big step is that as a state, we're acknowledging we have a problem. And so in the GHD Roadmap, really for the first time, we identified exclusionary zoning as an issue that we need to address as part of our attempts to address transportation emissions. And this year for the first time, we actually had two pieces of legislation that are just sort of the initial front of starting to act on this and they're incentive bills. One of them is a bill that created a new fund for affordable housing.And in order for a city to get access to the funding, they need to do at least one thing from a menu of options. And that includes making duplexes and triplexes by right in residential zoning districts. And it includes getting rid of occupancy restrictions and it includes getting rid of maximum parking requirements in at least parts of the community. There was another bill that offered something that cities have wanted for quite a while, which is greater flexibility to do inclusionary zoning requirements for rental housing. But again, in order to get permission to do that, you had to pick from one of these things that would help to increase housing opportunities and density within the community.I think there's a lot of interest in thinking about how do we continue down that pathway?David RobertsYou're surely watching California where they're trying to impose some state rules and the blowback is predictably nasty.Will ToorI think that what is going to be politically viable in Colorado, at least in the near term, will really focus on creating incentives and it may be figuring out how do we bring more money to the table and create really meaningful incentives for local governments. I don't think that the politics here would make it possible to do a Senator Wiener-like legislation from California. That's not on the table here. It's not politically viable. But we are certainly interested in starting to incentivize those local governments that are on the verge of being willing to go in this direction because in actual fact, there's a lot of benefits for the local communities.It's not just about those broad climate benefits, it's about creating communities that people can afford to live in and they can get places by walking. And there's really strong reasons why this is good for the communities, not just good for the state and where it works —David RobertsYes, but not always good for the homeowners who show up for the meetings though. That's the thing with local control.Will ToorYeah, I was a mayor for a number of years and I lived that.David RobertsYou poor man. What about transit though? Does the state have a little bit more influence over transit or is that mostly local too?Will ToorSo certainly our big transit provider in Colorado is in the Denver metro area and they are primarily funded by local sales taxes and they're controlled by an independent board. We did have a large transportation funding bill this year that I think was pretty important for starting to change the direction on transportation in Colorado. It did a number of things, and it certainly provides money for our State Transportation Department's ten year plan. That does include major highway expansions, but it also does a major investment in transportation electrification. Nearly three quarters of a billion dollars over the next decade that we think is going to be very important to achieving our EV targets both in the light duty space and in the truck and bus world.David RobertsWhat's that money go to specifically? Is it like point of sale rebates or charging stations or do you know yet?Will ToorWell, it does a number of things, and I would say we already have an existing assignable, refundable tax credit for light-duty vehicles, and actually for larger vehicles, but it's pretty small for the larger vehicles as a percentage of their cost. Because it is assignable, you can actually assign it to the car financing company at the point of sale. So for the companies that engage in that, which so far is Nissan and GM, it acts like a point-of-sale rebate. We also have existing law requiring utilities to invest and Xcel just got a plan approved to spend $100 million over the next three years, mainly in infrastructure, but it also includes enhanced point-of-sale rebates for low-income customers.David RobertsOh, cool.Will ToorBut this $730 million approximately is divided into three buckets. One bucket will go to our Department of Transportation, where it will be used to help transit agencies buy electric buses.David RobertsMy favorite.Will ToorAnother bucket goes to our Department of Public Health and Environment, where it'll be a clean fleet enterprise that will be spent on electric school buses, public vehicles, helping Uber and Lyft drivers switch to electric — and that part is actually funded by a fee on Uber and Lyft rides. And the fee is one level if you're in an ICE vehicle and a single passenger, and it's half as much if you're in an electric vehicle or have two or more passengers.David RobertsFunny.Will ToorAnd then it also will go to helping fleet transition for medium and heavy-duty trucks. And then the other bucket that lives here at the Energy Office goes to EV charging infrastructure, and it goes to supporting low- and moderate-income EV adoption. And the structure that we're looking at is kind of cribbed from what we've seen in some other states. And it's sort of like a cash for clunkers, but where we will work with you on both converting to an electric vehicle or to an electric bike, if that works better for you.David RobertsElectric bikes, that's going to make some people happy.Will ToorYeah. We started an e-bike pilot last year, and people have loved it. And we're going to use this money to grow it substantially because. It doesn't take that much money to do some pretty significant things with e-bikes. Senate Bill 260 — also this new transportation funding bill both really ramped up the state investment in things other than roads. Like historically, most of our state transportation dollars were, largely by constitution, were directed towards highways. We did manage to change that for the local government share of gas tax revenues. A few years ago, we were able to change it so that's now flexible dollars, it can be used for transit roads or bikeped.And so this new bill puts a billion dollars into that local share that can be used for whatever locals want. It puts a bunch of money into a multimodal options fund that is basically money that local governments can apply for for transit or bikeped projects. They have to match it for one for one. So it kind of doubles the amount that goes into that multimodal. They created a new air quality mitigation fund that's kind of focused on our areas that are in non-attainment with federal ozone standards and on environmental justice communities. And then it makes a bunch of changes to the planning process that will have an impact going forward.David RobertsI wanted to ask about that. Where the State Department of Transportation, you had some new planning requirements there that they include greenhouse gases in their planning, that they incorporate induced demand in road planning, which you'd think like how could any professional transportation agency not be incorporating induced demand by now? But I'm curious, I mean, maybe you can't really answer this, but sort of notoriously, this is true in Washington, like, state departments of transportation are like dinosaur agencies. They're like the caboose of the sustainable transportation thinking. I don't know why they all ended up like that, but do you have that same problem in Colorado, like, what's the level of sort of wokeness of your Department of Transportation?Will ToorSo our DOT has really changed in the last two and a half years. When Governor Polis came in, he brought in as our DOT director a woman named Shoshana Lew, who had been in the Obama DOT, where her role had actually been helping to, among other things, develop the light-duty vehicle, GHG standards and CAFE standards. And so she was the first state DOT director who I know, who really comes from a background of caring about climate.David RobertsRight.Will ToorAnd it was certainly a large cultural transition for the agency. Among other things, it was the first time that there was a young woman running that agency. And one of the things that is really striking, that is very different from other DOTs, is the extent to which many of the leadership positions there are now women from a climate background. In planning in the new Office of Innovative Mobility where they created to focus on electrification and transit and actually hired somebody away from the Energy Office who was leading our climate and transportation efforts. So the culture there has really changed.They've actually, over the last two years, really begun to do things like incorporate induced demand into their modeling and to really start thinking much more broadly about the role of transportation. Shoshana created a new program coming along with COVID to provide state funding to help with local street conversions from car-only streets to streets that could be used for walking, biking, transit, or sort of retail and restaurant use — that was super popular. People love it. We now have $115 million coming out of this transportation bill to expand that program. And so we're already seeing, I think, a much more progressive vision on transportation in Colorado than you saw in the past.But this legislation really builds in a focus both on environmental justice, creates a new division of environmental justice, requires much more modeling and mitigation of things like particulate emissions near highways, and it builds in an ongoing requirement that the DOT incorporate into its planning, helping to achieve the state greenhouse gas targets. So there's actually a rulemaking that is about to start at our State Transportation Commission to create greenhouse gas budgets for transportation plans, and future plans will have to show how they can achieve those targets.David RobertsWill any of that apply to the current highway widening plans that are set for the next ten years, or is this just for future?Will ToorSo it will certainly apply over the next ten years. It does not apply to the existing plan. Even though you describe them as ten-year plans, they get updated every few years.David RobertsRight.Will ToorAnd so the legislation explicitly requires that the next time the plan is updated, the new requirements around greenhouse gas mitigation and whatever new rules are adopted by the Transportation Commission and the Air Commission would apply both to the DOT and to our Metropolitan Planning Organizations. And it also tied some of the new funding to a requirement that in order to access that new funding, plans would need to be updated within the next three years.David RobertsOh, interesting. So there's at least a chance then that not all of the highway widening that's currently in the plan ends up happening.Will ToorSo, there are some projects that are certainly going to happen, the projects that are very far along, and the ones that most people think probably make sense. We have a highway through Denver, Highway 270, that is extremely congested, where they are planning on adding some high-occupancy toll lanes to them that is going to move forward. There are reasonable arguments as to why it should move forward and it's going to move forward. There's a project on Interstate 70 up into the mountains where the road is three lanes, and then it's two lanes for a while and then it's three lanes again where they're going to make it continuous three lanes.They're very close to starting construction. That's going to happen. But projects that are further out in the plan will certainly need to be reevaluated under the new planning rules.David RobertsRight. Okay, let's move on to the last big thing I wanted to hit before maybe the last two things. I want to talk about environmental justice quickly because there's environmental justice kind of sprinkled throughout. So what's the big story on environmental justice and sort of where are you most proud of it showing up in legislation?Will ToorYeah. So this is an issue that I think in Colorado, as in many places and as in the national conversation, this has really become a much larger part of the conversation over the last year. There's much more community engagement and organizing around this, and there's a lot of elements in legislation. The climate legislation that just passed creates a new environmental justice ombudsperson at our Public Health and Environment Department. It creates a new Environmental Justice Advisory Board and gives them some real authority over money because it's going to take environmental fines that companies pay and transition those out of our state general fund into a new fund for mitigation in EJ communities.And the Environmental Justice Advisory Board will have a huge role in how that money gets allocated. There was the creation of this new environmental justice office at CDOT to make sure that as CDOT is planning transportation projects, they're really engaging and thinking about some of those historical injustices and what the impacts of those projects will be. And then there are multiple places where various utility programs are being structured so that significant portions of the investment have to go to benefit either low-income communities or individual low-income residents. The other place that I think is going to be a significant focus is as we move forward with these new transportation electrification investments, we're really going to have a focus on deploying especially heavy-duty electrification in those communities that are most impacted by pollution.So we have an area, for example, in north Denver, where there are three major highways, tons of trucks and trucking fleets that are headquartered around there, the Suncor refinery and multiple other industrial facilities. When you think about the areas that are most polluted and where people are really being very much impacted by localized air pollution, that's not the only place in the state, but it's really a prime example. And it's a place where, when we think about fleet investments and where we're going to deploy charging, I think there will be a major focus on assuring that that's one of the areas that we focus on early.David RobertsThe one final thing I had a question about that is the advisory board — I guess when the EJ people hear about something like that, they're naturally, I think, suspicious a little bit, given history. So, what teeth does it have? Can it grind things to a halt? Can it really what are the legal mechanisms around it?Will ToorSo again, the place where it will have the strongest authority is over how those new mitigation funds are spent in EJ communities. But it will also certainly have a voice in the operations of the Department of Public Health and Environment and will have a voice in a rulemaking process. But as you said, it will certainly be an evolving process as we see exactly how it brings the EJ voice to bear in his rulemakings.David RobertsOkay, just by way of wrapping up, I've kept you long enough, now you've done so much stuff, we could just do a laundry list for 2 hours. There was some controversy along the way, some of the state environmental groups got upset. And I think, insofar as I understand it, the idea was that the roadmap that the governor released doesn't have legally enforceable caps in these sectors. It relies on sort of the sectoral policies and incentives and voluntary agreements. And so they tried to put forward a bill, Senate Bill 200, that I guess basically would have created a cap and trade system, or at least caps on all these sectors.And then there was some negotiation and now there are caps on some sectors and not others. Tell me the capsule version of that story.Will ToorYeah, I will do my best, and I think you framed it fairly well. There was certainly a narrative that was out there that the roadmap was a purely voluntary and aspirational document. I never quite understood that when we were moving forward in clean energy, plans at the Public Utilities Commission and rulemakings on oil and gas at the Air Commission had already adopted low and zero emission vehicle standards. Have a 2022 hold for medium- and heavy-duty emissions and looking at fleet rules and indirect source standards. Like, there's lots of individual sectoral policies that were enforceable. But what we did not have was an overall cap or cap and trade program.David RobertsAn economy wide program. I guess that was the source of sort of like the complaint, right? They wanted some sort of enforceable economy wide cap, right?Will ToorThat's right. And I think there were a couple of issues that we saw. One is that all of the work that we had done was sort of focused on this sectoral approach. And we had a set of strategies that we believe will get us where we need to go, with transportation certainly being the most challenging sector. And for a variety of reasons, the administration doesn't believe that a cap and trade program is right for Colorado and certainly not right for Colorado today. We also felt like the approach in SB 200 was such that it was going to take many stakeholders, including labor stakeholders and many stakeholders from different areas of the state and different industries who have been pretty willing to work with the state on implementing the roadmap.And it was going to turn them into determined opponents of climate action in Colorado.David RobertsBut if the targets are there, why would making them legally enforceable turn these people against them unless they weren't planning on meeting them? Do you know what I mean? I mean, that's the suspicion.Will ToorI think part of the problem was that you were looking at making things enforceable in sectors where it didn't work very well. So ultimately what the administration said was there were big parts of that bill that we liked. We liked the environmental justice provisions, we liked the small fees on GHG emissions to better fund the climate division within our public health and environment. We liked the social cost of carbon language, which broadened the use of social cost carbon for air regulatory purposes. And we were fine with having the statutory caps in areas where it aligned with strategies that made sense to us.So, we were already doing the rulemaking on oil and gas that's now statutory, and we're fine with having the legislature say "you have to achieve what we were planning on achieving anyhow." They did the same thing on the industrial sector and it added additional regulatory teeth on the electric side. That doesn't really change much because all the utilities were headed there anyhow and we already had the authority to act if we needed to if a utility didn't move forward. But it does strengthen that. So all of those we were fine with. Where we had issues were saying that the Air Commission had to adopt a cap on buildings because who are you capping?Like, we have the clean heat plans on the gas utilities. We think that that's a really creative approach to doing sort of the closest you can get to an overall regulatory requirement on buildings that makes sense. The way that it was written, we believe, would have required us to create a cap and trade program on buildings that would likely have imposed significant costs on consumers. Whereas the way we've structured it, we have a program that lives primarily at the Public Utilities Commission that requires them to work with utilities to develop the most cost-effective programs possible. That's not what we would have gotten out of a cap on the enforced through the air side.Similarly, on transportation, we know that, yes, there are models out there like TCI (Transportation Climate Initiative) in the northeastern states. But when we looked at TCI, which I think we would have been forced to do something like that, what we looked at was what, seven years now of debate over how to implement it. Most of the states —David RobertsNot implemented by any of the states yet, right? I mean, it's still —Will ToorNot implemented anywhere. And when you look at the projections of what it would actually do, it would generate revenue to invest in electrification and multimodal transportation. When you look at the amount for the four states that are talking about going forward, you look at the amount that would be invested per state. And we are getting more money invested in electrification and multimodal transportation by passing our transportation bill this year than we would if we were a TCI state. So we sort of looked at it and said, why would we do this incredibly complicated and controversial transportation cap approach when we can just work with a wide variety of stakeholders, have support from the business community and from local governments and from the environmental community on these new transportation fees and just move forward in a much more straightforward and less controversial way?It just seems like common sense to us. And ultimately we were able to get to a place with the legislative sponsors and advocates where we moved forward with the legislatively adopted emissions caps in those sectors where it works, move forward on the whole suite of buildings bills that we think is the most elegant approach to having as close as you can get to an assured approach on the building side. And we're able to take significant steps on transportation and we will continue as a state to move forward in multiple ways on transportation. We know after this greenhouse gas budget rule's adopted, we need to think about medium and heavy-duty vehicles.We then need to think about post-2025 light-duty vehicle rules, and there will be more work to do in the future.David RobertsThey're not here to defend themselves. So maybe this is not fair, but I feel like some of the people in the environmental community have an exaggerated sense of the significance of statutory caps. I mean, people are passing statutory caps all over the place that are getting violated and thrown out and — it's not magic; just because you make it statutory that it's definitely going to happen. You have to do the sort of ground-level work, the sort of detailed sector by sector work regardless even if you have the cap.Will ToorAnd the caps make more sense when you have a handful of industrial operations that you can work with — traditional regulatory approach makes great sense. When you're talking about millions of individual buildings and vehicles. You have to focus on a broader suite of strategies that get you market transformation.David RobertsWhat about a clean fuel standard like in Washington? Well, it's on the whole west coast now I guess. Did you think about that?Will ToorSo we did and it's not on our near-term agenda. We took a look at it. We did a feasibility study a year ago and the thing that gave us significant pause was when we did the analysis and looked at different scenarios for how you would comply. What we saw was a combination of both a fair amount of cost passed on to consumers but most of the money going into biofuels. And from our perspective, we think that the future is really about electrification. There may be an important role for hydrogen in the long haul heavy-duty space but at least based on our analysis to date we don't see the future as being largely about biofuels in the transportation sector.David RobertsRight.Will ToorAnd we were a little put off by an approach in which we were going to drive a lot of costs with most of the compliance happening through biofuels.David RobertsYeah, that's sort of the danger of kind of the tax approach or the incremental rising cost approach is you get the cheapest proximate solutions, right, but they might not be the ultimate solutions. And if you know the ultimate solutions why not just skip straight there instead of trying this sort of bank shot, ratchet attempt? Well, this has been very illuminating and excellent. Last question then is: I understand you don't have authorization yet from the governor's office to give specifics about your next term agenda but what in your mind are kind of the big climate wise and clean energy wise what are the big pieces left for Colorado to tackle?Will ToorAlso two of them I've already touched on and that is we really do need to take the next steps on building codes. We really do need to figure out how the state can work with local governments to help move towards better approaches to land use that will tend to reduce VMT and greenhouse gas as instead of driving higher levels of driving and actually in many cases higher levels of building energy use also.David RobertsWell, it's amazing what happens when you elect a bunch of Democrats, I got to say.Will ToorYou know, Governor Polis has been a real visionary in this stuff. I know I realized that the environmental community hasn't necessarily framed him as a climate champion in a way that we've seen in some other states. But, boy, working in the administration, I have seen the kind of all of government approach where he is building a focus on climate into every relevant department in the state and is giving us a real free hand to move creative policy.David RobertsYeah, I mean, I got to say, even though we've spent now almost an hour and a half talking about it, we've only hit kind of the big items. There's all these I mean, this is the kind of stuff I love reading about. Just this sort of really small bore, very specific stuff. Just tweaking this agency or this department or this budget. Just little things. But those are the things that add up. It's like hundreds and hundreds of those things that really add up in the end.Will ToorYep.David RobertsWell, thanks so much, Will, and maybe we'll see what y'all do next session and have you back on.Will ToorSounds good. Thank you, David.David RobertsAll right, thanks a lot. Bye.Will ToorBye. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

The cement industry, responsible for roughly 8 percent of total global carbon emissions, is notoriously difficult to decarbonize. But a new startup, Sublime Systems, aims to manufacture zero-carbon cement that can easily be substituted for the traditional version. In this episode, Sublime CEO Leah Ellis talks through the company’s vision and process.(PDF transcript)(Active transcript)Text transcript:David Roberts:Of all the so-called “difficult to decarbonize” sectors, cement is among the most vexing. Making cement produces CO2 not merely through fuel combustion (in kilns that reach temperatures of up to 1400 C), but also through chemical processes that split CO2 off from other molecules. It is responsible for roughly 8 percent of total global carbon emissions.Most gestures at decarbonizing cement to date are fairly desultory — things like adding special additives or injecting a little CO2 when the cement is mixed into concrete. The only widely available method that could theoretically produce no- or low-carbon cement is post-combustion carbon capture and sequestration. And there are plenty of people who would question whether that's actually viable at all, much less widely available, given that it would roughly double operational costs for a cement plant.There are lots of startups out there attempting to solve this problem (as reported by Canary last month). Perhaps the most intriguing is Sublime Systems, a team that has developed something truly new and exciting: a system for manufacturing cement that requires no high heat (thus no combustion emissions) and uses inputs that contain no carbon (thus no chemical emissions). That makes the cement, at least potentially, not just low-carbon but zero-carbon. What’s more, the company says that, in form and performance, its product is a perfect drop-in substitute for traditional Portland cement, so it wouldn't even require any changes in the construction industry.A carbon-free drop-in cement substitute — at scale and at competitive cost — would be genuinely transformative. I contacted Sublime CEO Leah Ellis to talk about cement chemistry, the company’s process, and the plan for reaching megaton scale. This one was truly fascinating and educational for me; I think you will really like it.All right then. Leah Ellis, CEO of Sublime Systems, welcome to Volts. Thank you so much for coming.Leah EllisThank you so much for having me.David RobertsI'm excited today to talk about concrete, everybody's favorite subject. But first I wanted to ask you, I know you and your partner originally were trained as and educated as battery scientists. I'm just curious how you ended up here. What drew you into this area, this problem?Leah EllisYeah, my co-founder is a professor at MIT, Yet-Ming Chiang, and he's in the material science department, and I'm a chemist by training. I like to think of chemistry as the central science that combines everything from physics to biology. All of the good stuff you can sort of spread into anything from a foundation in chemistry. So I did my PhD in lithium-ion batteries. I worked with a prolific inventor, Jeff Dahn, and after that I wanted to continue working with an inventor. As you may know, in academia, there are so many different styles of research.I mean, some people like microscopy and mechanisms, but I really like the creative aspect, like discovering something that could be useful or to solve problems. And not many academics and professors think through that lens. So I've always been very lucky to work with prolific inventors, both in my master's and my PhD. So for my postdoc, I sought to work with people who thought like that. So my co-founder, Yet-Ming Chiang at MIT, is a prolific inventor and also a serial entrepreneur. So Sublime is his 7th startup, and five of the previous six have been very successful.So I didn't join him with the aspiration of becoming a founder. I really knew nothing about entrepreneurship or anything like that, but I did want to invent, and I did love the way he approaches his work from a problem-solving standpoint. So that's what brought us together.David RobertsAnd he's the one who sort of flagged the problem of concrete to you.Leah EllisThat's right. So I was always aware that cement was one of the biggest levers for decarbonization. But I suppose after my PhD, where I'd worked with one of the most illustrious battery scientists, I sort of always had thought that my career would be in batteries. Like, I thought I'd painted myself into a corner. And so when I first met Yet-Ming Chiang, he asked a question that at first I thought was a trick question. He was, "Hey, Leah, like, you've got this Canadian grant to come work with me, and I know you're a battery scientist, but aren't you a little bit bored of batteries?"And I thought that was a trick question because he's the battery guru and I didn't want to insult him, but honestly, I sort of shared his opinion that, well, maybe this isn't his opinion, maybe it's just my opinion. But I think batteries are exciting, but I think there's like sigmoidal growth in any technology where it starts out slow to build momentum, and then it goes through a period where it's super hyped, and then you sort of squeeze all of the innovations out of things. And I think with lithium-ion batteries, which was my expertise, it comes to making the cans a bit bigger and the separators a little bit thinner and tweaks. And you know — I don't know, I just want to do something totally outside the box.And I think that's what Yet offered me the chance to do when he said, "If you're bored with batteries, why don't we think of a way to apply our electrochemical toolbox to cement?" And so the way he came up with that electrochemical cement tagline was he spends a lot of time thinking about reducing the emissions in the utility sector. And I think we have all of the technology needed to do that. I mean, not saying it will be easy to deploy solar, wind, long duration storage, but at least we have the technology. So that's not necessarily where most of the early stage R&D is needed.And so he was thinking at the time, like, how do we use low cost renewables, assuming that we'll figure out all of the utility stuff and really get to low cost intermittent renewables? And how do we take intermittent renewables and apply that to decarbonizing the next biggest tranche of emissions, which is cement? So cement, if it were a country, would be the third largest emitter after China and the US. So it's 8% of global CO2 emissions back in 2018, it fluctuates, but it's like 7% or 8%. So it's big game hunting when it comes to decarbonization. So we've always worked backwards from that electrochemical cement tagline.David RobertsAnd it's 8% of current emissions. But also, you make the point that's just going to go up, right? There's just going to be more and more cement as far as the eye can see.Leah EllisRight. And as everything else, I hope, goes to zero. I think these so-called hard to abate sectors like cement and steel, they may be both seven or 8% now, but in coming years, as the grid gets decarbonized, these numbers are just going to get larger because neither cement nor steel are going to go away. And in fact, we're going to use more cement, especially in places like India and Africa, that will undergo a phase of dirty growth unless we develop and deploy these clean technologies in time.David RobertsRight. So, let's talk about cement then. I mean, if you're looking for the big problem with no solution yet, it seems like you really nailed this one. So, let's talk about cement. I've been reading sort of the background materials of your company and reading about cement in preparation for this. I have tripled my knowledge about cement over the last 72 hours, starting from an extremely low baseline. What is interesting to me is that the process whereby cement is made, the emissions mostly come from trying to get lime. So, let's talk a little bit about how cement is made.So, cement, the recipe for cement, as you say on the website and in all these briefing materials, is calcium silicate hydrate (CSH). There are, I'm sure, details that matter, but that's the basic recipe for the basic kind of cement that we've been using for hundreds of years. CSH, they call it calcium silicate hydrate, and that is made of lime and silica and water. We can talk about silica and water later, but they're pretty easy to come by. So, mostly it's about getting lime, it's about how do you get lime? And the way we get lime now is starting with limestone.So, maybe you can just briefly describe the process whereby conventional cement is made. How do we get from those raw materials to the cement that we are familiar with in bags, mixing with water, et cetera?Leah EllisYeah, as you say, cement, the principal ingredient is lime, calcium oxide. And fun fact is, that's where Sublime Systems got their name. I was looking in a rhyming dictionary for something that rhymed. No shortage of cement puns. I can keep them coming if you like. Or maybe you don't like.David RobertsThat's excellent.Leah EllisSo, lime is calcium oxide or hydroxide. It's a reactive calcium that reacts with silica and water to make cement. Or when cement reacts with water, then it becomes concrete, that calcium silicate hydrate phase you mentioned. So, today, and historically, the path to making cement has been by thermally decomposing limestone, which is calcium carbonate, which is 50% by weight CO2.David RobertsYeah, that kind of blew my mind. I don't know anything about chemistry, so all chemistry blows my mind.Leah EllisYeah, it is mind-blowing. I mean, you think of cement, which is the world's largest industry by mass. So we use more cement than any other material besides water. And the prime ingredient in cement, it's about 65% weight calcium oxide. And then that comes from limestone, which is 50% by weight, CO2. So you just do the math. It's very easy to visualize. Just the massive CO2 emissions is staggering.David RobertsSo the emissions from cement are almost all around this process of getting lime. They're 50/50 — you break it down 50/50. So 50% is getting the kiln hot enough to break limestone down, which requires extremely high temperatures. What is it, 1400?Leah EllisYeah. So the way we make Portland cement, which is the modern cement that we've been using for the past almost 200 years, is you take limestone and then heat it first to 900 degrees Celsius. And that is the temperature at which limestone decomposes into reactive lime and CO2, and then to make Portland cement, which is a specific chemistry of cement, you heat it further to 1400 degrees Celsius, at which point the lime and the silica fuse together to make a phase called alite tricalcium silicate. And then that is quenched. So it's dropped very quickly from that hot kiln and sort of freezes that phase.That when you grind the cement into a powder that now reacts very vigorously with water, it releases a lot of that extra heat and that turns into the hardened concrete.David RobertsSo just to give people a visual here, a conception, this process of heating lime up and getting the lime out of the limestone, that's where all the emissions come from. They're about 50/50 the emissions.Leah EllisYeah, about 50/50. And of course, it depends on the design of the kiln. Some of them are more efficient than others, but it's about 50% limestone emissions, 50% fossil emissions. And to get to that very high temperature, you often require a very high caloric, luminous flame, which requires bituminous coals — is often the primary fuel for this type of kiln.David RobertsRight. So it's 50% this special kind of coal heating up this special kind of kiln to the extraordinarily high temperature of 1400 C. And then the other 50% is the CO2 in the limestone being broken out and then vented, I guess emitted. Which is just the reason I'm harping on this point, is just that I think a lot of people think of decarbonization as primarily an energy thing. But it's worth noting here that even if you find a decarbonized way to get that heat, that 1400 C heat, you're still left with 50% of the emissions. Right, because you still have CO2 coming out of the limestone as it's heated.Because we've talked a lot on this pod about alternative sources of heat and about heat batteries, thermal storage batteries that conceivably could get up to 1400. They have that in their sights. But I just want to emphasize that even if that problem is solved, you still got 50% of the problem left, which is all the CO2 that's embedded in limestone attached to the lime. So that's our current cement. 50/50, heating up lime, breaking the lime out of the limestone. Let's talk about ways that people have tried to approach, before we get to Sublime's approach, let's talk about other ways people have thought about this.It's a big problem. And if you think about decarbonization long enough, you end up here. What else have people tried to do with cement? I know there are a couple of things floating around, but maybe you just tell us sort of like, what are the other alternatives here?Leah EllisYeah, there are, as you say, not many technologies, if any, besides Sublime's, that can address both halves of the cement CO2 problem, the limestone and the fossil fuel, simultaneously. So you could electrify the heat in some way with a thermal battery or find some sort of electric kiln. And electric kilns have material problems. It's difficult to get things that withstand that temperature — the heating elements — if you're using resistive heating, for example.David RobertsIs anyone doing that yet? Is there an electrified heat source specifically making cement yet, or is that just an idea?Leah EllisNot that I know of. I mean, I think that would be the obvious solution, I think is to electrify the kiln. And I know there's some efforts with plasmas and solar concentrators and stuff like that, but I think that one would be, if it was easy, someone would already be doing it.David RobertsGetting extremely high heat with electricity is vexing.Leah EllisRight. And you can do it. The challenge is, like, can you do it efficiently? And then even if you do it, have you really solved the whole problem?David RobertsRight.Leah EllisSo, there's that. And then I'd say, like, what the industry is doing right now. And to their credit, they are doing everything they can to decarbonize, especially in the past three to five years. So there's a focus on alternative fuel. So, cement actually plays an interesting role in the garbage ecosystem because it's such a high temperature. It's just a really great place to dispose of things because everything at that temperature vaporizes into CO2 within a matter of seconds. So it's a great place to burn tires. It's a very clean way to burn tires.David RobertsWhat, in cement kilns?Leah EllisOh, yeah.David RobertsThey're throwing tires in there?Leah EllisYeah, I've actually visited a kiln that had this tire injection port, and I was able to stand on top of it and watch them drop tires into this kiln. About every 20 seconds, a hatch in the kiln, rotary kiln, would open, and it would drop in. I actually have a video I can send you a link to. It's one of the coolest things I've ever seen, but, yeah. The plant manager told me that the tire turns entirely to CO2 within 20 seconds. I think many of us have seen a tire fire which creates, like, black, choking smoke.But if you get to 1400 degrees C, it just undergoes complete combustion almost instantaneously. So tires, like tar shingles, unrecyclable plastic, medical waste, solvent waste. The list goes on. In fact, I have an employee that used to work at a cement kiln close to the US-Mexican border, and they would bring all kinds of contraband that was seized at the border and they would just unload pallets of contraband into the kiln. So, almost anything goes. But that can't be your entire fuel source. So that's a supplementary fuel source.David RobertsDoes anything except coal work here? Like, is there a substitute for this specialized coal here that can get to that kind of heat?Leah EllisYeah, I mean, some of them use like a blend of natural gas and other things. And often it takes a blend of fuels to really get up to that temperature. So first you have to start with propane and get it to a certain temperature, and then you add more oxygen. More coal is the typical fuel that's used. And so besides all of these giant cement plants, if you look at them on Google maps or something, there's usually you can see a little mountain of coal besides the kiln.David RobertsRight, but for decarbonizing that, you basically just have to capture the CO2 after it's emitted, right? From the kiln.Leah EllisYeah. So the ways the industry is decarbonizing now include alternative fuels and then what's called supplementary cementitious materials. And then of course, post-combustion carbon capture, which hasn't yet been proven at scale. But there are plenty of pilot plants because that's really the only other way, in my opinion, besides Sublime Systems that can get you to a fully decarbonized cement.David RobertsI mean, theoretically, right, that there's no carbon capture working even close to 100%, as far as I know, on any industrial facility. Theoretically, we could get to mostly decarbonized.Leah EllisTheoretically. And I'm afraid to share your opinion that post-combustion carbon capture has never been successfully demonstrated at scale for cement and for coal either. I mean, I sure hope it works because I think that is, if it worked, it would be the most expedient way to decarbonize existing assets. But I think there have been many challenges in employing post-combustion carbon capture at scale.David RobertsAmong other things, it basically doubles the operating cost, right? I mean, it's just like adding another industrial facility onto your industrial facility. And I just come back just on first principles. I was like, however we solve this problem, it's not going to be through some Rube Goldberg system where we double the cost of every single concrete plant and then bury kajillion tons of — and then build CO2 pipelines to all of them and then carry all that CO2 and bury it. It's just like, there's no way that's going to be it.Leah EllisYeah.David RobertsAlthough that's kind of where people are going. That's sort of the only option.Leah EllisI like to use the leaky tap analogy when talking about climate change. So imagine you have a tap that's leaking or gushing water. There's really three ways to fix it. And one is to stop this flow of emissions and through carbon avoidance technologies like Sublime Systems like renewable energy. And then the other thing you could do is put a bucket right underneath the tap and collect it point source. And of course, that's just a patch solution if you don't have the means or the ability to fix the tap right away. And that, of course, is point source carbon capture.And then the third way you could go about fixing this problem is mopping the water off the floor. And in this case, the analogy is director carbon capture, which is collecting the water in a much less efficient, more energy-intensive, more dilute way. And I don't think it makes sense to mop the water off the floor unless you've done steps one and two to mitigate the stem of the flow of CO2.David RobertsI just want to mention these materials you're talking about adding to the process.Leah EllisYes, that's important.David RobertsJust to explain that. So you want the lime to react with the silicates. That's the point of all this. But through this process, you end up with a lot of lime sort of left over that has not reacted with a silicate. And so you add these supplemental materials and that kind of boosts more of the lime to react. Is that basically right?Leah EllisYeah, that's right. So that phase that I mentioned that is made in the kiln is called tricalcium silicate, or alite. And that is three calciums, tricalcium to one silica. And then that hardened phase of concrete that cement turns into as it hardens into concrete is calcium silicate hydrate. One calcium to one silica to one water, approximately. So Portland cement has three times more calcium than it really needs. Those two extra molecules of calcium are just on for the ride. They don't significantly contribute to the strength or to the durability — in fact, they make today's cement maybe less durable than, let's say, Roman concrete was.So this actually started decades ago. Let's say in the '60s, '70s and '80s, people started using coal fly ash, which is a silicate, and blending that into cement. And at first they did it to save cost, because at that time, coal, fly ash, people would pay you to take it off their hands and it dilutes the cement, so — they did it for cost saving reasons. But really it makes better cement when you balance out that calcium to silica ratio and you also can lower your CO2 emissions. But that being said, you can only lower the CO2 emissions of your concrete by about 30% before you start having too much silica to calcium, and then that starts deteriorating your performance.So, there's fly ash, and that is going away. So the cement industry is now moving, trying to find other sources of supplementary cementitious materials. These include natural sources of silicates like the Romans used, volcanic ash, so pumice, certain types of calcined clays. All of these are being developed as ways to dilute the Portland cement with no or low emitting minerals, which do in fact make better concrete at the end of the day. But again, these supplementary cementitious materials can't, like, they can only solve 30%. Maybe you could get to 50% if you accept some differences in performance, but they can't get you to zero because these are bringing silicates, they're not bringing that lime, and there's no way to decarbonize lime, unless I think you're going about our process, which uses renewable energy and non-carbonate sources of calcium.David RobertsRight. These materials you add, they're going to come back into our story later. A little Chekhov's gun there. All right, so I've made you and the audience wait for 20 minutes now. So let's talk about how you solve this dilemma. So we've got limestone that has to be broken down into lime. And right now, the only way we know how to do that is heating it up extremely high with a fossil fuel kiln, which emits things, and then you break it out of limestone and it gets emitted. So you need basically what you and your partner came to, where all of this sort of leads you as you sort of analyze this process, is we need some other way to get lime.Basically, that's the nub of the concrete problem. Basically, we need a way to get lime that does not involve emitting a bunch of CO2 as we break it out of limestone and does not involve super, super, super high temperatures. We need a room temperature way to create decarbonized lime. So I think anybody who sort of reviews the process of how cement is made from a carbon perspective, is going to end up there, right? Lime is the thing. So then you say in your Medium post, once the goal was clear, it took us less than a year of focused effort to invent a way to make carbon neutral lime at ambient temperature, which kind of like, blew my mind a little bit.I guess it's just that no one had looked before. Or it's just crazy to me that once you started looking, there it is. Which to me indicates that they must not have been looking very hard before.Leah EllisI think that's true. I don't think people had been looking very hard before, maybe for two reasons: So, one reason is that never before have we had a pathway to low cost renewable energy. Which is why something like this may have been invented decades ago, but it wouldn't have made sense. So I like to call Sublime the electric vehicle of cement making, because we're replacing these high temperature fossil fueled kilns with something at ambient temperature that avoids combustion but —David RobertsI love this. Can I just pause and clap here? Because I swear, like, almost every one of my pods, no matter what technology you're talking about in terms of modern technology you're talking about, it's super, super, super cheap renewables that are unlocking these possibilities, like one after the other. Stuff that it would have been too energy-intensive and expensive to do up until very recently. But renewables getting so, so, so cheap is just like one after the other, unlocking all sorts of possibilities in all sorts of areas. You wouldn't even necessarily think, right, like cement. The first thing you would think is like, renewable energy can do that, right?But it turns out there it is again. There's cheap renewables coming to our rescue yet again. Sorry, go ahead.Leah EllisYeah, well, totally. I mean, it expands your toolbox and just like an electric vehicle, if you were to power your Tesla with a coal fired power plant, I mean, there's really no point. Same with us. We use the same or similar number of kilowatt hours in terms of energy for our process. But if you're going to power that with a coal fired grid or just fuel it with coal directly, there's really no point. And so I don't think I'm really that smart. I think someone 30 or 40 years ago would have arrived at this conclusion. I think it's obvious in retrospect.David RobertsSo many discoveries seem that way, right?Leah EllisYeah. And then the other reason why I think my co-founder and I were special in being the ones to discover this obvious in retrospect pathway is that we blurred the lines. I think many people, especially in academia, they're sort of pigeonholed into their area of expertise. And I don't even credit myself for this move. I think it was my co-founder, who's a tenured professor at MIT, very celebrated. He's already made his career, so he's quite comfortable putting it on the line, being exploratory and cross-pollinating two disciplines that don't see each other. Like civil engineering, is where cement lives.Electrochemistry is in material science or in the chemistry or physics departments, and those often don't touch. And the grad students may not even meet each other on campus. And so I do think it required a certain degree of boldness and courage on the part of my co-founder. And I was just trying to make him happy and be his conspirator and co-inventor, but that original concept definitely came from him.David RobertsSo let's talk about how you do it, then, how you make lime with an ambient room temperature process that does not produce CO2. It turns out to involve another theme that comes up a lot on Volts, turns out to involve an electrolyzer. So, walk us through a little bit how you end up with lime.Leah EllisYeah, and I have to say, it may be quite simple in retrospect, although there's a lot of high tech technology and patent applications will be filed. But at a high level, it is so simple. I can explain this to someone with high school chemistry. So, when you do water splitting, you make hydrogen at one electrode, oxygen at the other electrode. But if you start with neutral pH, water or a brine, you make acidic solution at one electrode and an alkaline solution at the other electrode as a function of that water splitting reaction. Now, once you have that pH gradient, you can use it to drive a chemical reaction.In this case, the dissolution of calcium from a mineral. If you're using limestone as a source of calcium, which we don't, you can think of this as like a Mentos and Coke reaction, where you have a carbonate reacting with acid to dissolve those minerals and release the CO2. So we could use limestone, and we could capture all that CO2, which, just like the Mentos and Coke, the CO2 would be cold, clean, and compressed. If we do this in a pressurized unit, and we could likely collect a lot of money for 45Q tax credits. But we chose to abandon that path and go for that true zero approach of using a non-carbonate source of calcium.So, there are many calcium silicates, both natural minerals and also waste materials that are calcium silicates. We can dissolve the calcium from those minerals, leaving behind a reactive silicate. Those calcium silicates are inert. You put it through a reactor, the acidic side of the electrode dissolves the calcium, leaving behind a — so we've broken those inert bonds — leaving behind a reactive silicate. Then the calcium swings over to the negative electrode, precipitates as a hydroxide. Now you have reactive calcium, aka lime, and you have a reactive silicate and you dry those off into free flowing powders, blend them together, and now you have a cement that is very much like Roman cement where Romans, they didn't make Portland cement at 1400 degrees Celsius.They made what's now called a pozzolanic cement, where they took volcanic ash, the silicate, and they took lime, which they made at 900 degrees Celsius, that first step. And they blended those together with water to make a cement that has evidently stood the test of time. So we're following that old recipe.David RobertsIt's all lime, silica and water.Leah EllisAt the end of the day, yeah.David RobertsAt the end of the day you're getting your lime. So you're precipitating lime out of lime containing calcium silicates.Leah EllisThat's right.David RobertsAnd so that would be your raw material instead of limestone. So just on the materials side, you're going to need a lot of whatever that is. What is that going to be? What is that material that you're going to break the calcium out of that you're going to be able to find in bulk that does not contain CO2?Leah EllisYeah, broadly, it's basaltic minerals. So anything with 10% calcium, more or less could be a suitable input material. So basaltic minerals, this is the type of rocks that are typically used as aggregate in concrete. So we can almost use the same supply chain that people use for aggregate can be used as input for our material as well.David RobertsSo there's no choke point there. That's an abundant material. There's no worries about finding enough stuff, basically.Leah EllisYeah, that's right. There are no worries about finding stuff. Although of course, even for cement plants today, making sure that your quarries are in close proximity to your market, it is a big exercise to site a plant and to minimize transportation costs because cement is so massively produced, which makes it very cheap and it's also very heavy. So there is a game here that we are also playing alongside any other cement company about siting your plants in proximity to market or in a way that you could float it by boat, since that way it travels very inexpensively. So you find cement plants on the Mississippi River, on the Hudson, near ports where the cement can float.David RobertsGot it. You know, you're talking about using just sort of aggregate, just sort of like junk rock as an input. Is there any input you could use where getting rid of it would actually be an extra value stream? Like some sort of waste that you could dispose of by doing this.Leah EllisWe have looked at loads of waste. So we have an ARPA-E grant that looks at ponded bottom ash. So there's billions of tons of ponded bottom ash. Like historical. So this isn't the fly ash, the stuff that comes out of the top of the smokestack. This is like the bottom ash, like the stuff with heavy metals that sort of is at the bottom. It's the icky stuff that they've ponded for hundreds of years. So there's billions of tons of this that needs remediation. This is the stuff they'll pay you to take it away. And with our process of dissolving the metals, extracting it, leaving behind a silicate, and then precipitating the metals and isolating them, could be a way to clean up bottom ash.We've also looked at other things, like you could even use our system to recycle demolition debris. So dissolving the cement and turning it into fresh cement. We've looked at eggshells, we've looked at municipal incinerated waste, we've looked at clamshells, I don't know. For s***s and giggles we've tried out a laundry list of things to make sure they work. But really what we're going for is to optimize our process around materials that are widely abundant, and especially in places like India and Africa. Because Sublime's stated mission is to have a swift and massive impact on global CO2 emissions.And we know that both India and Africa are going to undergo a period of dirty growth if their population is going to grow and enjoy the same quality of life that we do, and if they build carbon intensive cement and steel plants. Those plants are designed to last 50 to 100 years. So if we work quickly to scale up this technology, we want to make sure that all greenfield cement plants in these developing regions are made with technologies that will avoid CO2 emissions for decades to come. So we really have a small window of opportunity to really get ahead of generations worth of CO2.David RobertsYeah. So you need a cheap and abundant feedstock, which makes sense. But getting back to this, like, say you're using bottom ash, the way you're getting lime out of this stuff is that lime precipitates out at a particular pH level, right? Sort of like a threshold. And presumably other chemicals will precipitate out of that mess that you throw in there at other pH levels.Leah EllisDifferent pH. Yeah.David RobertsRight. So could you, if you're just dumping a bunch of sort of bottom ash slurry into your machine, you can pull out the lime. Can you also pull out some of the other, like those heavy metals you're discussing that we don't want in our water or soil? Could you precipitate those out too? Like, can you isolate other things other than lime if you wanted to repurpose this in the future for some reason?Leah EllisYeah, you could. And in fact, if we're using basaltic minerals, those aren't only containing calcium and silica. Those are also containing iron, magnesium, aluminum, which we are isolating as a function of our process, like you say. And what my director of R&D likes to say is, "We use the whole rock just like hunters use the whole deer." So all of these things are coproducts. And in fact, things like magnesium are actually worth more than cement.David RobertsOh, really?Leah EllisWe're actually not — yeah, I mean, it's a fine chemical.David RobertsAre you pulling out enough magnesium out of these materials that that could be a —Leah EllisSo it could offset the cost?David RobertsYeah, like a meaningful value stream.Leah EllisI mean, we think so. Although our focus is cement, we know that people invest in us to have that swift and massive thing. So we are focused on doing this cement work. And everything else is just gravy. We actually haven't factored those costs in and done that business development work to see how much it sweetens our cost, because we're just focused on making the cement. And I have to say one of the reasons why Sublime has a cost advantage over other ways of decarbonizing cement is that, as you said before, we're not adding on to a Portland cement kiln.Adding carbon capture is going to at least double the cost of making cement. And because our technology is carbon avoidance, it's green cement, not blue cement. We are replacing the kiln with a new technology. Now, we may not be able to compete on cost with our first plant because cement has undergone almost 200 years of improvements and redesigns of the kiln where they had wet kilns, semi-wet kilns, and dry kilns. And finally, these five-stage preheater, precalcinator kilns, which I won't get into, but they've undergone tremendous efficiency improvements over the past 200 years. And so we think we can get really, really close.And I don't think any other technology can do that because they're always adding on to a Portland cement kiln.David RobertsI mean, it seems like if you could sell the magnesium, you bring down the cost of your cement and make it more competitive.Leah EllisTotally.David RobertsSo instead of a kiln, you have an electrolyzer, which does not require high heat. All this process you're talking about with the metals precipitating out is an ambient room temperature process. Yes?Leah EllisYup.David RobertsAnd you end up with lime. And then you can mix lime with the silicates that you also got out of your raw material. Or do you have to bring in extra silicates to mix with the lime? Once you've got the lime. And what are they?Leah EllisNo, we're using our own silicates. And of course, if we want to get the desired calcium to silica ratio, it may mean blending in certain inputs to get to the right ratio. But yeah, it's just a tweak to get the input ratios to match the output ratios of what we want.David RobertsAnd so this cement that you are producing with electricity and non-CO2 containing rocks, I assume you have produced it. And it has been through whatever tests, whatever governing bodies put cement through?Leah EllisIt has. So our cement meets what's called ASTM C1157, the performance-based specification for hydraulic cement. This was a standard that was created 30 years ago. And really this standard is so important because previously cement was defined by the crystal structure of what was made in the kiln. So that alight tricalcium silicate phase that you can only make, it's only thermodynamically stable at those volcanic temperatures. So you cannot solve for alite, you know, unless you go through that thermal process. So, actually, when we were at MIT, my co-founder and I, we believed that if you weren't making Portland cement, nobody would use it.That was the prevailing myth at the time. I got out and networked with the industry and spoke to the customers and realized that people who work at a readymix concrete producer, those folks running the spinning trucks, they don't know what alite is. They've never heard of tricalcium silicate. They talk about slump, they talk about alkali silica reactivity and set time and finishing properties. And so we realized that it was the performance of this cement that matters. It's not the chemistry and the standard bodies have prepared for this moment. And all of this work with supplementary cementitious materials, which are gaining traction, especially in Europe, is just winds of change that are blowing in the right direction.Because as you start blending cement with other things, it becomes much less about the chemistry that you're making in the kiln and more about the ultimate performance.David RobertsSo the standard is about performance.Leah EllisThere are multiple standards. So there are three standards baked into the international building code. One is for pure Portland cement. The second one is 50% Portland cement, 50% SEM. So a blended cement. And then the third one is pure performance-based. So we don't care what you do, as long as whatever you have performs this way. And there's an exhaustive list of tests that you have to do. You want durability and strength and freeze-thaw and chloride ingress and all these different things that you test to make sure that your cement is performant. So we've done those tests.We do them in-house. We have a world-class cement testing lab, but that's not good enough. We send it out to an accredited third-party lab, we test it again, and then — just so that we don't waste our customers' time — and then the third test is done by our customers. And that's really the test that matters. And so this quarter, we finished our pilot plant early January this year, and then spent a few months optimizing our production, ramping it up, testing it in-house, testing it with the third party, and now we're testing it with the customer, and the results have come back very strong, positive, and we're working with some of the best people at Boston Sand and Gravel.David RobertsWell, presumably, what you would want to hear from a customer is just nothing. They just used the cement and it worked fine and —Leah EllisIt works exactly.David RobertsThere's nothing to report. I said those supplementary —Leah EllisCementitious materials.David RobertsYes, thank you. I said they would come back into the story. Those supplementary materials that are being added into traditional cement to incrementally lower its carbon intensity, those are the silicates that you're using to mix with your lime. So you're actually just using the lime and the supplementary materials and just skipping, basically, the Portland cement kiln part of it.Leah EllisYeah.David RobertsAnd so you've produced this cement that is now passing performance tests being used in the field. It's working well. One point I did want to make before we leave behind the process part is if you use a feedstock that doesn't have CO2 in it and you use renewable energy to power your electrolyzer, then you've got bona fide zero carbon cement, the holy grail. But you make the point. And I think this is maybe just worth pointing out. Even if your process uses limestone as its feedstock and thus has CO2 in it, and even if it uses average US grid electricity.Right, which is not clean. Even if you do both those things, you still end up with cement that's lower CO2 than conventional cement.Leah EllisThat's right.David RobertsSo basically, switching to this process immediately improves the carbon performance of cement, even if you don't have your electricity and your feedstock dialed in perfectly yet.Leah EllisThat's true, although we will accept nothing less than perfection.David RobertsWell, you say in the medium post that you're currently 70% decarbonized. Does that just mean there's still some limestone in the process?Leah EllisYeah, exactly. But it is our goal to get to 90%. And so when we model our megaton plant with optimized feedstocks, optimized electricity, we just did a lifecycle assessment with Climate Earth, which is the cement industry's preferred lifecycle assessment partner. So we did show that we can get to 90% lower emissions than today's Portland cement using our process at scale.David RobertsWhy 90 though? What's the 10% left over?Leah EllisOh, I believe that was from the mining and transportation. And those are sort of outside of our gates. So again, if you're traveling by truck or going back and forth between the quarry and the kiln and that type of thing.David RobertsAh, interesting, interesting.Leah EllisBut I'm sure those will go to zero too, as all those heavy trucks get electrified.David RobertsSo, your big plant that you are envisioning here, your mega-scale plant, your full-sized plant to be certified as basically super low carbon, let's say 10%, 90% carbon-free, you're going to have to find the right quantity of feedstock, a non CO2 containing feedstock, a steady, large supply of that, and you're going to have to somehow certify that your electricity is completely clean, which is going to get you in the same sort of tricky situation that the hydrogen people are in right now, which is how do you certify that electricity is totally clean? You can't just use grid electricity, right? Because then you're taking the clean electricity from someone else. You basically are going to have to like — it's additionality.You end up with the additionality problem. I don't know, that's probably way down the road for you. Maybe you haven't even thought about that.Leah EllisWell, we do think about this. So we have a kick-ass head of project development and strategic sourcing. So shout out to Becky and she's doing the work to cite our megaton plant. And we're looking at places that have renewables. And I know the hydrogen folks, as you say, struggle with this too. So we require — anything six cents a kilowatt hour or less is fine with us. And we're looking to site first in places with a high degree of renewables. And again, it doesn't have to be zero, although zero would be great, but it's just as low as reasonably possible.David RobertsWould you ever build your own renewables attached?Leah EllisYeah, we might. We're looking at that too. And then to your question of additionality, we're actually gearing up to publish something recently that shows that because Sublime Systems is a great way to use a renewable electron because it has similar embodied energy as today's kiln. But you're not just using that renewable electron to replace a fossil electron, you're also getting avoided carbon through avoiding the limestone as well. And so when you calculate the amount of CO2 avoided per kilowatt hour, you compare that over many other technologies using that the highest and best use of a renewable kilowatt hour could be for Sublime cement.David RobertsInteresting.Leah EllisAccording to our calculations.David RobertsInteresting. So let's talk a little bit about scale and about cost. Right now you've got basically a little lab set up. You're producing this stuff, but on a very small scale.Leah EllisWell, I wouldn't call it little. It is a fully functioning, continuous pilot plant that can do up to 250 tons a year. But it is small. And we affectionately call it our cement plant for ants, if you know the Zoolander reference.David RobertsWhich is just to say that scale will bring lower costs.Leah EllisBut totally, it's all about scale.David RobertsRight. Insofar as you know, the costs now, currently, because as you say, traditional cement is very cheap. So are you currently in the ballpark or what's the sort of timeline? How do you see getting into the ballpark? Where are you now and where are you kind of targeting?Leah EllisRight. So where we are now is definitely less than cement plus post-combustion carbon capture.David RobertsThat's a low bar, but yes.Leah EllisWell, is it a low bar? So one of the things is that cement is very inexpensive, and that is a double-edged sword for us. So that makes it very difficult for us to compete on cost with a new technology that hasn't yet achieved scale. But on the other hand, that makes it — the so-called green premium — really that small. Especially when you compare it to other things like direct air carbon capture or sustainable aviation fuels. And also, if you think about the total installed cost of concrete. So 80% of the total installed cost of concrete is labor, and it's often unionized labor.The cement is 10% of that, and the aggregate is the remaining 10% so even if we were to charge a two to four x green premium, really, it doesn't really affect the overall cost of a building that much.David RobertsRight.Leah EllisBut your carbon savings are huge. So, again, if you're thinking all across clean tech, that green premium or the carbon credits, if you think of dollars per ton of CO2 captured or avoided, I think Sublime cement is really attractive. When you do that analysis, especially as we come to scale.David RobertsHow big does the green premium need to be currently to bring you down to Portland cement costs?Leah EllisYeah. So presently we're scaling up. I mean, I don't even dare calculate what it costs at pilot scale because it's so handmade. But at this next level of scale that we're doing. So between where we are now, which is pilot scale, and where we need to be at megaton scale, we do have to build what we're calling the kiloton plant.David RobertsAn in-between plant.Leah EllisExactly. An in-between plant. And that is to validate the product, the process, the economics, the performance, to enable us to attract low-cost project finance so that we can build the megaton plant, ideally many megaton plants, and work with partners to deploy this all over. So at that megaton plant, you don't have the economies of scale that we would have at the megaton.David RobertsKilotonLeah EllisYeah, at the kiloton. You know, we like to say the megaton plant is like achieving Costco level status. And at the megaton plant, I do think we'll be able to compete on costs.At the very least, we'll be able to undercut cement decarbonized by post-combustion carbon capture by a long shot. So I'm very confident saying we'll be the cheapest low carbon cement, especially after we crunch the numbers with all the co-products that you mentioned. But at the kiloton scale, I think this is at the farmers market pricing. So the people who will be taking offtake from our cement, from that plant, they will realize that they're paying a higher price for something that's special, for something that comes with the added value of a lower profile of harm against the planet.And the premium that they're paying is reinvested into our technology, into the people that are making this happen, and that it is very much catalyzing this technology that I believe will be obvious in retrospect in a post-carbon world.David RobertsRight. Well, they'll have warm feelings, but I think there are also — we'll talk about this in a second — but there are also some entities who are under sometimes self-imposed, sometimes legally imposed requirements to find low carbon cement. Some people are doing it because they need it, not just because they'll feel good about it. So, scale wise, the kiloton plant is roughly when?Leah EllisSo that depends on a lot of things, but we're ready to have that. We are on track to have that built and commissioned and operational by early 2026. But of course, that timeline requires everything to go perfectly. But we're all geared up for that.David RobertsAnd that will be a working, like, you'll be selling concrete. It'll be a full-size selling concrete plant. No longer just a test or a demonstration.Leah EllisThat's right. We'll be selling cement to concrete producers.David RobertsAnd then, assuming everything goes well. Of course, everything never goes well. Assuming everything goes well, you have your kiloton plant in early 2026, you're selling cement, it's working, your customers are happy, your financiers get more confident. They extend to you some low-cost capital for you to scale up. Then you build your megaton plant, everything goes well. When does that happen?Leah EllisThat could be as soon as 2028. Again, these are very aggressive timelines, and this assumes everything goes well. But once that kiloton plant is built and validated, assuming we have sites ready to go, those megaton plants could be built as quickly as within two years.David RobertsAnd then a megaton plant produces how much?Leah EllisA million tons a year.David RobertsA million tons a year. And so to replace any meaningful amount of cement supply, you would need a bunch —Leah EllisHundreds of them.David RobertsHundreds of those eventually. Have you thought about, I mean, you're selling cement. Have you thought about licensing the process and just having other people work on joining you and trying to scale up?Leah EllisWe do all the time. So, like I said before, we're capitalists around here, as you know. So I hope we'll make a healthy profit for the investments. But the goal is to have a swift and massive impact on global CO2 emissions as quickly and as bigly as possible. And I hope we'll make money along the way, and I expect we will, because that's how value is measured. But really, it's all about speed and scale, because we could do this ourselves. But really, I'll just be honest here, we're nerds. What gets us fired up is this technology and the product that we're making.There's a lot that we don't know. One of the reasons why the cement industry has taken so long to change is because innovation is not part of their DNA, per se. They run operations like nobody's business. They keep these megaton plants up and running around the clock with high-quality, reliable material that's distributed in the most efficient way to get everything built with minimal disruptions. It's really, truly remarkable.David RobertsYeah, you pretty quickly get beyond the science part to just logistics and stuff like that. There's like a whole set of those considerations for large-scale businesses that are unique to scale, I think.Leah EllisExactly. So the operational know-how is there. And I think we would be foolish to try and reinvent the wheel entirely by ourselves. And I mean, would we be able to build? So let's just say we address half a gigaton of CO2 emissions per year. So cement is 8%. Let's say we set our expectations low, aim for 1% of CO2 emissions or half a gigaton. That's like 500 megaton plants. So how will we get to 500 megaton plants by 2050, if that's our goal, working backwards, we would need at least ten up and running by 2030, let's say.So I really think if we're going to get this s**t done, we have to take what we do well and merge it with what the industry evidently does well, which is the operational logistics and know-how. And so, we speak to cement majors almost every week, and they're coming to us, and they have a legitimate desire to not be the world's largest CO2 emitters. And this is also an interesting fact. So cement companies, they have the highest scope one emissions of any company. You would think it's Aramco or Exxon, but no, they're making fuel that other people are burning. It's cement companies.David RobertsYeah. Scope three, that gets the oil companies.Leah EllisYeah, totally. But cement companies, it's their scope one, so they have a great big X on their back, especially in Europe.David RobertsWell, it also seems like, I know there are improvements. It's not fair to say that you're sort of stuck with what you're stuck with when you're using fossil fuels. I know there have been improvements in the kiln process and in the input and the kind of kiln, but there's a certain sort of baseline, like when you're using limestone and you're using Portland cement process, there's a certain floor, right? Whereas when you're using electrolyzers technology and you have a bunch of different feedstocks to choose from and a bunch of different metals that you can pull out of those feedstocks, it just seems like you're opening up a lot of new areas for innovation.Basically, the runway for cost declines seems huge here.Leah EllisYeah, I believe so too. And I think what's really exciting is that if Sublime succeeds, and I believe we will, that technology that we're starting to build now, and that will continue to improve over time, will be the way we make cement for the post-carbon world, like, for the next millennia. So I feel like this is a really cool place to be where cement innovation happened with the Romans. And we still go back and visit those monuments that they made. And then cement was innovated a second time by the British with Portland Cement. And now we're creating new cement in America that's for this post-carbon world.And so often when you think of buildings and the architecture, the way you make a building is often a representation of the values of the people who've built it. And so I think it's a very exciting time for us to be making this new material and to be incorporating it into the most cutting-edge buildings that we're building today. For some of the best and most forward-thinking companies.David RobertsThese electrolyzers, are they a special kind of electrolyzer that you need custom built, or are these just normal, off-the-shelf electrolyzers? What is there to say about the electrolyzers?Leah EllisThey leverage a lot of existing technology. So electrolyzers broadly are very similar. You've got electrodes, often with a carbon backing, often with a rare earth catalyst, you've got separators. There's kind of like assembling a sandwich of electrode, separator, electrode. And so many components of our electrolyzer exist and have been scaled up to megaton scale, and we're simply taking that and leveraging that for our own purposes.David RobertsSo like your own kind of sandwich, but made with standard ingredients.Leah EllisExactly. We're taking the bread and the mayo and the lettuce, and we're just slapping them together in our own special way.David RobertsRight, but in terms of electrolyzers for your process, you're the one making them. So that'll scale up too, and presumably get cheaper too.Leah EllisYeah, exactly. And I think many of the trends we see with hydrogen and all these other electrochemical things taking off, I mean, we do anticipate that as well — we've got the dropping price of renewable electricity, especially intermittent renewable electricity — and I believe we'll also see electrolyzers come down in price as well.David RobertsYeah, yeah. I talked to the woman in Iceland who's making ammonia directly with electrolyzers. I clearly need to wrap my head around electrolyzers better and do a whole episode on electrolyzers, because I had thought they were just for hydrogen, but now people are doing all sorts of other things with them. Anyway, so final, I promise, question: What sort of policies would help you? I mean, I think some of them are obvious, just like lowering, requiring lower CO2 emissions, maybe requiring government procurement. Like government could say, we're going to buy lower cost cement. What are the other sort of big buckets of policy that you think would help accelerate this process?Leah EllisGovernment procurement would go a long way because the US government, in its various forms, army, GSA, federal highway administration, DoT, procures 60% of the cement produced in the US.David RobertsOh, wow.Leah EllisSo if we don't have a commitment from them that they want this cement, it makes it more than twice as hard. But the policy change that I would really like to see, and what really grinds my gears is that when you look at tax incentives and production tax credits and also the voluntary carbon market, they reward disproportionately direct air carbon capture. For example, I'm forgetting the acronym. Is it 42? Oh my gosh. Can you remind me what?David Roberts45Q? That's the carbon capture one.Leah EllisC three. Anyway, the carbon capture one, it's $180 a ton for direct air carbon capture, $80 a ton for point source carbon capture, and zero for carbon avoidance. And we applied for a production tax credit for our low carbon production of cement and we were discouraged from submitting a full application. And I think it's unfair, using that leaky tap mop bucket analogy, that you should be incentivized more for mopping up CO2 than for fixing the tap. And I believe there should be a technology agnostic implementation of the tax credit to put all of these things on a level playing field and then let the invisible hand of capitalism choose the most efficient way to decarbonize.I don't think the government should be picking winners.David RobertsWell, this is the danger of industrial policy, right, is that once you get down in the gears, you're going to inevitably sort of get some things and skip other things and get out of balance. Presumably there are other policies besides carbon capture, policies that would help you, right?Leah EllisYeah, I actually think direct carbon capture is great. I'm definitely not anti-direct carbon capture. I'm just advocating for carbon avoidance to be valued the same as a ton of carbon removed from the air, especially when the carbon avoidance is technology enabled, like Sublime Systems. I think there's a role for this premium, this farmers market stage that we're at, to get that added boost so that we can get to a stage where we don't need that incentive anymore. But you will never get there with DAC. It'll always need to be propped up somehow.David RobertsYes, I know. Have you gotten help from the LPO? From the loans office?Leah EllisNo, they haven't helped us yet. Although had some interesting conversations with Jigar Shah and others from the LPO. And I do hope that once our kiloton plant is built, we will definitely work with LPO.David RobertsIt seems so obvious this is such a huge opportunity here and exactly at the stage of business that they're designed to help. Okay, so some sort of production tax credit would be great. Some sort of government procurement strategy. Is there anything like that in place? Is there demand pull? I know that a bunch of companies are saying they want to reduce their own emissions. A bunch of concrete companies are saying, where are we at on demand pull? Like, is there a big developing market for low carbon concrete that's going to help pull you through this?Leah EllisI am seeing huge demand for low carbon cement and I would say that our customers are leaning into us just as much as we're leaning into them and they want more of it sooner. It's one of those things, though, that's difficult to manage. And I think maybe like setting up a carbon market, people are not used to seeing new products in the cement world and so getting these advanced market commitments and these offtakes. Right now, when people build a new cement plant, cement is vertically integrated with concrete, oftentimes. So you never need an offtake for building a new cement plant and even the supplementary cementitious materials.The industry just knows that if the product meets a certain quality, that there will be, at a certain price, it will be bought.David RobertsRight, right.Leah EllisSo these offtake agreements have sort of never been done before until now. But, yeah. so we're still in the stage of figuring that out and standardizing those agreements. And one day I hope there will be a sort of book and claim model for selling our material as well as other low carbon cements.David RobertsYeah, it does seem like, especially once it's wider known that this is available and that it performs as well, it just seems like there's just going to be huge demand from every which way. Leah, this has been absolutely fascinating. I've been meaning to dive into concrete forever and this was a good excuse to learn. It's funny. I'm going to finally learn how it works right on the cusp of it changing to a new process. But thank you so much for — I feel like you've really found the right target here. This is such a leverage point for so much change.So thank you for coming on and walking us through it.Leah EllisThank you so much for having me, and for being an enthusiastic listener as I talk about my favorite subject for a full hour.David RobertsAwesome. That's what we're here for. All right, thanks so much.Leah EllisThank you.David RobertsThank you for listening to the Volts podcast. It is ad-free, powered entirely by listeners like you. If you value conversations like this, please consider becoming a paid Volts subscriber at volts.wtf. Yes, that's volts.wtf. So that I can continue doing this work. Thank you so much and I'll see you next time. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

To create a clean-energy economy, the US badly needs an advanced mining industry that can provide huge amounts of key minerals for batteries and other technologies — and it’s nowhere close to where it needs to be. In this episode, KoBold Metals CEO Kurt House describes the current state of mineral exploration, the significant changes it needs to make, and how machine learning and artificial intelligence can help it get there.(PDF transcript)(Active transcript)Text transcript:David RobertsBuilding the machines and batteries needed to decarbonize the economy will require enormous amounts of a few key minerals. The proven reserves of those minerals, sitting in mines now operating, are nowhere close to enough to satisfy what is expected to be skyrocketing demand.Without the minerals, we can’t make the clean-energy economy. And we don't know where the minerals are going to come from.What's worse, exploring for new mineral deposits has been getting less and less efficient over the last several decades, as the amount of investment needed per successful discovery has risen. We seem to be getting worse at finding this stuff right when we badly need to be getting better.That state of affairs has drawn in several new startups that endeavor to use machine learning and artificial intelligence to improve mining’s hit rate. The most talked-about is KoBold Metals. With financial backing from Bill Gates, Jeff Bezos, and other big-name investors, KoBold is now exploring for minerals on four continents.To get a better handle on mining and how we can improve at it, I contacted KoBold CEO Kurt House. We talked about the projected gap between supply and demand, the somewhat primitive way current exploration works, the massive data-gathering and coordination project the company has undertaken, and the role of justice and equity in this AI-accelerated future of mining.Kurt House, CEO of KoBold Metals, welcome to Volts. Thank you so much for coming.Kurt HouseI'm so pleased to be here. I'm a huge fan. I listen to the podcast all the time, so it's fun to talk to you live.David RobertsWe're going to talk about something that is of great interest these days, which is finding the stuff that we need to build the clean energy economy. This is something I did a series of articles on a couple of years ago, and it's come up repeatedly over the years. People talk about possible shortages of materials as one of the bottlenecks that might slow the clean energy transition. So maybe let's just start there with setting some context, talk a little bit about the big four minerals that you focus on and sort of what we know about how much we have access to and how much we project we're going to need.Kurt HousePerfect setup question. So, the energy transition is fundamentally about getting off fossil fuels. It's fundamentally about electrifying the economy to the greatest extent possible. So we electrify transport, all electric generation becomes renewable, et cetera, et cetera. That requires a lot of very specific materials and very specific materials because different elements have different physical properties, obviously, and they do different things better and worse than others. And some of those elements are really difficult to substitute for, for very, very deep physical reasons. So KoBold is focused on what we call "the materials of the future," and those are lithium, cobalt, copper and nickel.That's not at all to say that there aren't other important materials for the energy transition.David RobertsAre those four the most important? By just mass, just, we need most of those —Kurt HouseNo, by total mass, it'd probably be aluminum and steel, iron for steel. The reason these are so important, there's two orthogonal reasons that we focus on these. One is how difficult they are to substitute for in specific applications. And I'll talk about that. And then the orthogonal element to it is that they are exploration problems. So aluminum is really useful in a whole bunch of reasons, but it's not an exploration problem. There's just gobs of bauxite, aluminum silicon oxide on the planet, and we know where it is. It's just a matter of processing it in more efficient and less carbon intensive ways.So, it's a metallurgical challenge. It's not an exploration challenge. In the case of lithium, cobalt, copper and nickel, you could take any forecast you want, but basically the end state is something like 2 billion electric vehicles on the planet, plus a whole bunch of renewable energy build out. And any way you slice it, those are just gigantic numbers, and they require gigantic amounts of lithium, cobalt, copper and nickel. And then you can say, "Okay, that's how much we need at, say, 2050 to be mostly off fossil fuels by 2050, how much exists in the reserves of current mines?"So if we take all the mines that are producing today, and they're going to produce out for the next several decades, that's another number. That's another quantity. And that you also have to add in all of the other uses for these minerals. Right. If the economy just goes on, and there's lots and lots of uses for nickel and copper, in particular in stainless steel and all manner of electrical applications for copper that just happen anyway. So you have to add up those, plus the energy transition metals and compare them to existing mine supply and existing mine reserves, and you get a gap.And then, if you multiply by current commodity prices, that gap is about $15 trillion.David RobertsGood Lord.Kurt HouseWe call that — exactly — the "missing metals gap". And so it's not the total amount of metal we need. We actually need a lot more. But that's the value of the metal that we need to find, right? We need to find and then develop into mines.David RobertsThat represents metal we need, but we don't yet know where it is or where it's going to come from?Kurt HouseExactly. Because I've subtracted out existing mine supply. Right. And not just existing mine supply, but existing mine supply, plus mines that are in late stages of development. We know they're going to be mines. We've just included that in existing mine supply. So it's really the things that we need to find new deposits that no one in the world knows where they are right now. And then we need to develop them into operating mines — to build new mines. And then those mines need to go into production, and they need to operate for many, many years to produce the necessary amount of metal.And the value of that metal, roughly speaking, is $15 trillion.David RobertsAnd that all needs to happen — if you look, like, 2050 used to be a lot farther away than it is these days. And now if you look at those lines, they're going up and to the right pretty steeply. So all of that stuff needs to happen much more quickly than it has in the past.Kurt HouseExactly right, David. And that is what makes this so difficult. So, in round numbers, in very round numbers, it's about 1000 new deposits need to be found, and then 1000 new mines need to be developed.David RobertsWow.Kurt HouseAnd that, obviously, that's a function of I'm using sort of median mine production. It could be 700 if they're bigger or whatever, but it's order of magnitude 1000. It's a huge number. And then you can say, "okay, well, how fast are we building new mines today? Finding new discoveries and building new mines today?" And the answer is, "not nearly fast enough."David RobertsWell, this is something you told me about last time we talked, which has stuck in my head ever since. You called it "Eroom's law of mining," which is Moore's law backward. Explain what you mean by that.Kurt HouseYeah, precisely. So, Moore's law. The audience will be very familiar with Moore's law. Right. One of the most remarkable demonstrations of human ingenuity of all time, which is that the density of transistors on chips has doubled every 18 to 24 months for 55 years now. And the result is a ten to the 10th order of magnitude increase in computational speed, computational power. So we get better and better and better computation, and that's why you and I can talk remotely in real time from far — everything else that people know. Okay, that's Moore's law. So go back to 1990 and look at how much money the industry was spending in aggregate on exploration, and then divide that number by the number of good new discoveries they were making per year.David RobertsRight? Dollars per discovery.Kurt HouseDollars per discovery. And by good discovery, I just mean a discovery that definitely becomes a mine. It's a good tier one, tier two discoveries, we'd say, in the industry, but it becomes a mine. That number was about $300 million in today's dollars. In 2023 dollars, that was about $300 million per good discovery. Today, that number is about $3 billion. It's gotten an order of magnitude more expensive to find the next deposit. We're getting worse. So we call this Eroom's law, because over the last 40 years, we've gotten ten x worse at exploration, we have to put in ten times the amount of resources to find the same amount of stuff.Or put it another way, we'll find one 10th the stuff if we invest the same amount in exploration. And exploration expenditure is basically flat, roughly speaking. So we are way, way, way behind and we're spending roughly half a percent a year of what would be needed based on the current exploration effectiveness, dollars per discovery. So on the current rates and current expenditure investment, it will take about 200 years for humanity to find enough deposits.David Roberts$3 billion. If you think about 1000 new mines needed —Kurt HouseThere you go.David Roberts1000 times $3 billion adds up to some large —Kurt House$3 trillion. And that's just exploration expenditure. That's not including the cost to actually build the mines, which is a lot more.David RobertsSo let's break this down a little bit or unpack this a little bit, because with Moore's law, I think people get, on the one hand, getting more computing power out of tinier and tinier spaces gets harder and harder. Like the job gets harder and harder because you're working with just less space and tighter materials and et cetera. But our improvement at doing it is growing faster than the difficulty, basically. Like, we're getting better faster than it's getting harder, I guess, is the way you would put it. If we just remained the same good at doing that, productivity would be declining because it would be getting harder and harder and we wouldn't be getting better.That seems to be what's happening in mining. It's not that we're getting dumber or worse at mining, it's just that finding the stuff is harder because we've already found the easiest stuff. So finding stuff gets harder and harder, but we're just not getting better at it.Kurt HouseYou explained it perfectly. That's exactly right. Another example that I've used, that's even a better example because you just took Moore's law a step further. But another example I use is like fastballs in Major League Baseball were like 85 miles an hour in 1970, and then today they're like close to 100 mph. It's objectively harder to hit that fastball, but batting averages are about the same. Right? So pitchers got better, batters got better. Right. And your point is exactly right is that — are we actually getting dumber? I don't think so. We're not actually getting dumber. It's that the search space is getting way harder because, as you say correctly, the easy things have been found.And what is an easy thing? It's actually really easy to understand. An easy thing is a deposit, an ore body that's going to be mined, that's sticking out of the ground that a skilled field geologist walks up to the outcrop, looks at the outcrop, identifies ore minerals in the outcrop, and says, "These are ore minerals right here. We should explore this because there might be enough of them to constitute a mine here."David RobertsYeah, you told me that when we talked before, and it blew my mind a little bit because one of the things I'm finding out about this as I do this job more and more is just like normal american consumers are so used to everything going digital and everything being sort of like fancy and computerized now that when I go ask about other areas, I'm often struck by how analog they remain, sort of how kind of primitive they remain. And something you told me is that almost all, like literally almost all of the discoveries we've had and the mines we now have come from someone just seeing something on the surface, like literally the same way they found stuff to mine in 1800.Kurt HouseYeah, it's absolutely right. If you were to build a time machine and bring the best exploration geologists from 1960 to today, they would be very comfortable working in the industry. Very comfortable. You have to teach them email. Right. You have to teach them a few things —David RobertsZoom meetings.Kurt HouseExactly. Zoom meetings. But in terms of the field work and the techniques, they would be very similar.David RobertsAnd so should we envision groups of people out walking around looking, or how do we search the surface today?Kurt HouseYeah, I mean, field geology is a skill, and it's a hard skill to learn. It takes a lot of practice. And there are very skilled field geologists that KoBold employs, and they're absolutely essential to our business. They're fantastic. And just because a technology or technique is old doesn't mean it's bad. There's a lot tried and true methods just sort of continue for some good reason. Right. And so field mapping, for instance, which is basically, if you walk along the ground, think about, you're either walking along bedrock that's an exposed outcrop, or you're walking along soils or something else that's kind of covering the bedrock.And so field mapping exercises are, there's actually a lot of kind of tricky geometry to it, and it's about identifying the outcrops. It's about making measurements about where the outcrops go underground and then extrapolating in a kind of heuristic way what those rock bodies would look like underneath the cover. Those are sort of useful techniques, and that's what historic field geology is all about.David RobertsAnd so, historically, when someone finds something sticking out of the surface and they say, "hey, this looks like an ore concentration. This looks like a concentration of some ore that we would like to mine" at that point, then what, the mining company just goes in and just starts poking holes down, digging down and looking?Kurt HouseYeah. Once you find an occurrence, you might call that an occurrence, mineral occurrence. Then you go and explore to see if it's large enough and sufficiently high concentration to be an economic deposit. It's a good lead. Not every occurrence turns into a mine, but every mine at one point was an occurrence. Right.David RobertsRight. That's what I'm trying to get my head around is, what does that look like? What do those holes look like? Are they narrow, little pokey holes, or is this, like, a big operation when you're digging down, exploring?Kurt HouseSo, for the exploration component, they're very narrow holes. Think a few inches in diameter that you drill. And what you're trying, you're extracting core samples. Right. You're extracting to characterize the full geologic body and to characterize the deposit. Right. And understand what the composition is, what the grade is, how extensive it is. Does it keep going at 100 meters deep, at 500 meters deep, or does it stop at 20 meters deep? Those are all the questions that you try to answer.David RobertsOf the occurrences that geologists find and say, "Hey, mining company, this looks promising." What percentage of those pan out into a mine?Kurt HouseVery low. Yeah, very low.David RobertsOh, really?Kurt HouseYeah. Well, less than 1%.David RobertsNo shoot. No kidding.Kurt HouseNo shoot. No kidding.David Roberts1%! I guess that explains the $3 billion.Kurt HouseYeah, that's right. I'm glad you came full circle back to that, because the reason we've gotten on an underlying cause for Eroom's law, but a more directly observable cause, is that the success rate has dropped. And so you're spending — the individual success cases are sort of just as economic as ever, and they're wildly economic. The difference is your false positive rate has increased or your success rate has decreased. And so you spend more small investments on things that don't pan out. To make the numbers simple, imagine each little small investment characterization effort is $10 million.David RobertsSo that's to go poke all the little holes and look, that's $10 million.Kurt HouseExactly. That's to go see if that occurrence is actually an economic deposit. Right. And we're using round numbers here. 40 years ago, you might have gotten 1 out of 30, and today you get 1 out of 300.David RobertsYeah. So $10 million. If you're having to do it 100 times to find metals —Kurt HouseThat's the problem.David RobertsThis isn't in danger of making mining overall uneconomic. Right. If you find the minerals, you're going to —Kurt HouseRight. So the individual success cases are still as good as ever. Actually better than ever, really, because you still spend, say, $10 million, roughly, and then you fail, fail, fail. And then the person that succeeds — and these are often different groups, right — the one that succeeds spends $10 million and then has something that's worth billions.David RobertsRight.Kurt HouseAnd all of the successes, sort of, by definition, have to pay for the failures or the industry just won't attract any capital at all in the aggregate. So you can kind of assume that the successes are worth something like $3 billion, and that's about right. And so the success cases do incredibly well.David RobertsA bit of a lottery vibe to it.Kurt HouseFor sure. I mean, this is where the word eureka comes from. Literally. The unit economics of exploration are just superb. They're fantastic. They've always been fantastic.David RobertsRight.Kurt HouseAnd so if you can imagine, okay, if you could build a technology or a set of technologies to increase your success rate just marginally, just a little bit better, maybe two or three times better than the industry, then you'd have an incredibly valuable set of technology and company because you could turn exploration into a science. Yes, you're going to fail a lot, but if you fail nine out of ten times, as opposed to 99 out of 100 times, then you make superb money. Because every success —David RobertsIf you think of it as a lottery, I mean, winning the lottery twice out of 100 times is a lot more than winning it 1 out of 100 times, right?Kurt HouseExactly.David RobertsBecause the winnings are very large. And I just want to get this on the record before we move past. As we're talking about exploration, just by way of background-background. None of the things we're discussing in terms of the difficulty of finding and extracting minerals are about absolute scarcity.Kurt HouseCorrect.David RobertsAll four of the minerals you cite —Kurt Houseyes.David Robertsare, on an absolute basis, far more common than we could ever use, right?Kurt HouseAbsolutely. There's roughly in the top kilometer of the earth's crust, there's enough nickel to give every man, woman, and child on the planet about a million electric vehicles. So it has nothing to do with the number of atoms in the earth's crust. That's not a problem at all. In fact, right below your feet right now, below your house, or wherever you are, I would bet long odds that the concentration of nickel, say, in the ground below you is about 100 parts per million. That's about what it is in the background concentration of the earth. And so that's there.And we could mine it. We could do it. We could go and mine 100 ppm. In fact, that would be a spectacularly good platinum mine if you had it in that concentration. But it would cost us like $100,000 a kilogram to extract it. The current nickel price is $16 a kilogram.David RobertsRight. So what you need to find is concentrations of these things. And the reason that the vast, vast, vast majority of the concentrations we found of these minerals are close to the surface is just that the surface is where we're looking. So what we find tends to be adjacent to the surface.Kurt HouseExactly right. And it is the mother of all selection biases. Right. Understandably so. You could pose an alternative hypothesis: You could say, "Okay, yes, we found all these things at zero meter elevation, but how do we know? Maybe that's just where they form. Maybe they form when the right minerals contact the atmosphere or something." You can make up a scientific hypothesis.David RobertsMaybe they drift up toward the surface for some reason.Kurt HouseYeah, exactly. That would be a reasonable scientific hypothesis. We know for certain it's not true for these four minerals. We know for certain because we know the pressures, temperatures, and oxidation conditions in which these minerals form, and they form deep in the subsurface. So actually, that's really good news, because that tells us that as we descend into the subsurface, take 100 meters depth slice as opposed to a zero meter depth slice. Your strong expectation should be that the aerial density of deposits increases because since they form deep in the subsurface, a kilometer deeper, it's only the rare few that have been moved to the surface through tectonics and erosion and then been exposed.Right. And so we really have high confidence they're there in high concentration form. They're just way, way harder to find.David RobertsRight. And talk a little bit before we get to how your company is making that easier. Talk a little bit about what we're looking for. We talked before; you mentioned composition, depth and grade; just quickly sort of go over those. What makes for a good deposit? A promising deposit.Kurt HouseYeah, those are sort of the big three. There's lots of small details, but grade is king. That's a phrase you hear in the industry all the time. And the reason that grade is king is really obvious. Like concentration really matters. So imagine this. Imagine you're looking at two different deposits, let's call them copper deposits. Okay. One copper deposit — so the average grade coming out of copper mines around the world today is 0.6%.David RobertsYeah, I've heard about it. And that's been declining, pretty sharply declining. Right. I've been reading about that. It's very alarming.Kurt HouseYeah, it has —David RobertsBecause we need a lot of copper.Kurt HouseWe need a lot of copper. And we've been creaming the curve. We've been getting the lowest cost stuff first.David RobertsRight.Kurt HouseSo 0.6%. So that means if you mine a ton of rock, you do all the work to get a ton of rock out of the ground. You get 1000 kilograms rock. Right. And you get 6 kilograms copper. 0.6%. So you get 6 kilograms of copper for every one ton of rock that you mine.David RobertsGod, that just seems crazy.Kurt HouseIt is crazy, seems crazy, but stay with me on this. So the ton of rock, all your costs go into mining the ore. The rock. Right. The costs scale with ore. Revenue scales with metal, because you don't sell the ore, you sell the metal. Right.David RobertsRight.Kurt HouseSo now imagine a different deposit that is 6% copper instead of 0.6% that deposit. Now you spend the same amount of money to get that one ton of rock out of the ground. So their costs are the same. But now you get to sell 60 kilograms copper instead of 6. So you sort of, by definition, have a 90% plus profit margin because the costs — the other operator was there and maybe breaking even at 0.6%. And now you're selling 54 more kilograms of copper for no incremental cost.David RobertsSo find distinctions in the concentration of the mineral in the ore make a huge difference.Kurt HouseAn enormous difference.David RobertsThat's great.Kurt HouseYeah. So grade is king. The second most important variable is composition, which really gets down to the ore minerals themselves. Right. So a good example here is nickel. And so you actually can find relatively high grade nickel in silicate form. So olivine is a nickel silicate mineral that can get relatively high concentrations. It's not uncommon to get 1% nickel silicates, but it's very hard to process, very expensive to process that. Alternatively, you can get nickel sulfides at 1% or 2% that are very easy to process, relatively speaking, very easy. So a 1% nickel sulfide deposit is way better than 1% nickel and silicate deposit.And then depth obviously matters a lot. It matters kind of less than you might think. Believe it or not, there's a big distinction between whether it's an open pit mine, i.e. just a big hole that you're digging in the ground, versus an underground mine where you're digging tunnels. There's a relatively large distinction there in terms of cost of operations. But once you go underground, depth doesn't actually matter that much. I mean, up to a point, you can't go 10 km below the earth, but the difference between 300 meters and 700 meters doesn't matter that much, actually.David RobertsSo digging that additional 100 meters down is not a huge cost.Kurt HouseIt doesn't matter a lot. Yeah. I'd much rather have higher grade deeper than lower grade, shallower.David RobertsSo what would be like a really high grade, say, for copper? You say 0.6 is the average these days. That seems — I mean, what do I know about. I have nothing to compare it to, but it sounds low.Kurt HouseIt is low.David RobertsWhat's a really good grade?Kurt HouseOver 3% is superb. Like superb, superb.David RobertsGot it.Kurt HouseOver 5% is absolutely world class. And there's almost nothing like it out there.David RobertsInteresting. Okay. What we've established is currently we're finding minerals based on some exploration geologist on the surface, squinting at rocks, finding good rocks. And then you poke a bunch of holes. If you find a decent looking rock, you poke a bunch of holes around it, find out if it's down there in the 1 out of 100 times that you find suitable deposits down there. You dig down there and open a mine. And this is why 98%, 99% of mines and deposits have been near the surface or close to the surface.Kurt HouseCorrect.David RobertsSo this is all background for current mining. And the productivity of that is declining, presumably just because the big obvious surface concentrations that we could find, we've mostly found. And so now we're like squinting, we're going after harder to find stuff, et cetera. And the whole productivity of the sector is declining, even as we desperately need it to 10x its output in the next 20 years. All in all, an alarming situation.Kurt HouseThat was a perfect summary.David RobertsSo then along comes KoBold. So just tell us, how is KoBold going to help that situation? What is it you do to help miners?Kurt HouseYes. So KoBold's main objective is to improve the success rate of exploration, right? Exactly. This problem. The declining success rate of exploration is Eroom's law that's resulting in the higher cost, the more cumulative expense to make a discovery. And so our objective is to improve the overall success rate or really the exploration efficiency or effectiveness, which is dollars per discovery. That's our real goal. We want to have our own exploration success rate of closer to $100 million per discovery, as opposed to $3 billion per discovery.David RobertsAnd that's the money side. What about the percentage side? Like you said, 1% success rate. Now, we're skipping ahead a little bit here, but if KoBold continued to advance and miners really took it up and took it seriously, what would a really good success rate look like?Kurt HouseYeah, well, let me actually correct you on one thing. We're not a service company or a SaaS company at all. We don't provide, we don't sell anything to mining companies. Yeah, we are a full stack exploration, development and mining company ourselves, started in Silicon Valley. We are Silicon Valley's mining company, so to speak. Right. Your confusion is totally understandable, and it's common.David RobertsI thought you were striking deals with big mining companies.Kurt HouseWe do, but only on co investment into particular projects. We own — we don't get paid anything for services or anything for software. We make money by making discoveries, and we partner with mining companies on their properties as well as we have our own. So we have something like 60 projects worldwide, and about half of those we own 100% by ourselves, and about half of those we own in partnership with other companies. Partnerships are very important to us because we want to extend the reach of our technology. And lots of companies own a lot of ground that they're not exploring.And so we can sort of leverage that opportunity and say, "Okay, this is interesting ground. It's actually worth more in our hands than it is in your hands, because we can deploy our technology, let's work it together, and we'll both benefit from any discovery."David RobertsSo you're co-mining those, you're both involved in the mining?Kurt HouseVery common misconception and very understandable, because if you look at our team, it's about two thirds of the technical staff have never worked in the mining business before. They come from Google and Apple and Meta and Silicon Valley and all the tech monopolies that you know and love or hate, and they probably never will again. Right. They don't think of themselves necessarily as working for a mining company. I mean, of course they do. They understand the business, but they think of themselves as working for a tech company. And they are deploying their skills as data scientists, software engineering, software engineers for this purpose.David RobertsRight. So you own big machines that dig up the earth.Kurt HousePrincipal asset are licenses to deposits. Right. Our principal assets are the deposit itself or the deposit itself. And then, of course, we use all kinds of capital equipment to explore and ultimately develop the deposits.David RobertsOkay, so if you own these yourself, then you don't have to speculate what better discovery rate would look like. Presumably, you have established one. 1 out of 100 is the baseline here. What does your discovery rate look like?Kurt HouseYeah. So I prefer dollars per discovery. And the reason I prefer — I'm going to answer your question, but it's important to think about the different metrics. The reason I prefer dollars prefer discovery is we encourage lots of little projects that falsify their hypotheses fast and for low money. Right. So, there was a project we had recently where one of our scientists had a hypothesis about a particular deposit. They came up with a clear falsification criteria. We staked the property for probably $1,000. We went out to the field. They made several measurements, geochemical measurements. It falsified the hypothesis.We moved on from the project at something like $5,000. Right. It's an extremely efficient condemnation. And that's really important because there is an enormous amount of uncertainty in this business. That is the nature of the data science problem is it's a sparse data problem, and we're making inference on very select data about the physics and chemistry of the Earth crust, trying to make predictions with quantified uncertainty and then seeing how accurate those predictions are and then updating our models accordingly. So we want lots and lots and lots and lots and lots of shots on goal. So I don't actually track total number of attempts because actually the numerator is high.But dollars per discovery, I very much do track. And we are on track for we have made one major discovery, which is public. It's in northern Zambia. Cumulative exploration expenditure up to the point of that discovery was actually less than 50 million.David RobertsThat's quite a bit better than 3 billion.Kurt HouseYeah, exactly. So we're very much on track in that sense, except that we only have one that's totally unambiguous, and then we have a lot more that we're working toward. So we'll see. It'll take time, we'll see over the next five or ten years. But I'm very encouraged that we are on track at this point.David RobertsOkay, well, so let's back up. What the company does is gather data, use AI, machine learning to analyze the data in order to predict where you're going to find concentrations, basically.Kurt HouseCorrect.David RobertsThat's the nutshell. So let's talk about the data. I think when people hear this, their first thought is like, "Well, if the data was there, why weren't other people using it to find these things?" Do you know what I mean? If the data was publicly available, what's your magic sauce? So, first of all, let's just talk about, and this struck me, too, the last time we talked, is just the wild range of data that you guys are gathering. Talk a little bit about your data gathering.Kurt HouseFor sure. So that is the right question for any kind of AI/ML technology ever, any application is, what is the data? Right.David RobertsWhat are you learning from?Kurt HouseRight. The algorithms, with all due respect, the algorithms are pretty straightforward, actually. They're brilliant, but they're easy to replicate and they're kind of a commodity at this point. What the real secret sauce of any AI company is, do they have superior data source?David RobertsYeah, so I should mention, I was going to mention later, but I'll just mention now, obviously, KoBold is not alone in this. There are several companies now trying to use basically data gathering and AI to improve success rates in mining exploration. There's a bunch in Australia, I think there's one in Europe. So insofar as you're competing, I mean, it's probably a giant market, and there's room for plenty more entrants, I would imagine. But insofar as you're competing, that's going to be the arena in which you're competing is who can find the cleverest new sources of data to improve their results.Kurt HouseYeah. There's a lot of truth to what you just said. I will mention on competition — this is useful — I am really rooting for those other companies. And the reason is I literally never think about competitors. And that sounds cocky, but it's not really, because let's say we need 1000 new mines for the energy transition. If KoBold is responsible for 50 of those new mines, we are going to be wildly successful beyond my possible imagination. And that's 5% of the problem.David RobertsRight.Kurt HouseAnd so we still need other people to find and develop the other 900-plus mines. And so what is it that's going to stop KoBold from getting from 1 to 50? It is not that someone finds that one first because there's another 950 we need to find. Right. What it is, is that we just fail to find it. Right. So we are fundamentally just kind of competing with ourselves, in a sense.David RobertsRight. More of a pass-fail than a grade relative to competitors.Kurt HouseYeah, totally. It's just like, if you're like what I tell my son in track, you're just focusing on your own pr. Just get your own time down and the rest will work out. Right.David RobertsAll right, so let's talk about data.Kurt HouseYeah, so, data. So this is really interesting. Right? So humans have been collecting information about the physics and the chemistry of the earth's crust for a very long time. Yeah.David RobertsMining is real old.Kurt HouseReally, really old. Right. In some ways, they've been doing this for. I mean, we've been doing this for millennia. In some ways, certainly in the last century, been collecting information in more and more sophisticated ways. And virtually all of that information is in the public domain, actually. And the reason it's in the public domain is either it was actually collected at the public's expense in the form of various state geologic surveys around the world and then made public. That's thing one. Thing two: It was collected by academics and then made public.David RobertsRight.Kurt HouseThat's thing two. Thing three is created by private companies, but almost always, with some exceptions, the rules. The laws in every jurisdiction out there are that when you have an exploration license or a mining license, you are required to submit the data that you collect.David RobertsOh, interesting. That's by law. Everywhere by law.Kurt HouseThat's right. And these are really good rules, actually, because what you don't want, if you want efficient exploration of resources, you don't want everyone collecting the same data, proving the false positive again and again and again. Right. That's bad. So usually the way the rules work is the company gets a couple of years to husband the data by themselves, and then they have to make it public. Right. And that's true in basically every jurisdiction we operate in. So there's a huge amount of information. We'll get to what the information is in a moment. But the challenge is that this is the messy data of all messy data problems.Right? So it has been collected. You're talking about everything from modern worldview three, high resolution, high spatial, high band resolution spectral imagery all the way to 1920s handwritten drilling reports. Right? That's all the information. And there's everything in between. And so it's every media, every storage media, from paper to cloud storage, every storage media you can imagine.David RobertsMicrofiche?Kurt HouseMicrofiche, you know, magnetic tape, you name it — it's all out there. And then it's every jurisdiction; every sub-jurisiction has different formatting requirements over time.David RobertsTo what extent has there been a kind of shared format for this? Or is it all completely disparate?Kurt HouseBasically none. I mean, people could quibble with me and they could point out some standardization efforts in the past, which is not wrong. But basically, to first order, if I show you 100 data sets that we found in the public domain, they're going to be in 100 different formats.David RobertsOh, good grief.Kurt HouseYeah. So the first thing that we do, and this is a major effort, we've been doing this for five years, and we're going to continue to do it for many more years, is we identify these data stores, and then we ingest the data, bring it into our system. Which could mean, it could mean, digitizing paper records, right? And we have those operations around the world, including a very extensive one in Zambia, which is really cool. We digitize the paper records, we do various optical character recognition techniques on those records, and then we use various extraction, NLP and other extraction technologies to extract the data, transform it into what we call our universal data schemas.So we are the major effort to create a standardized format for all of this data, which is our own proprietary format.David RobertsWhen I'm thinking about this process, how much of that is done by AI and machine learning versus some poor schmuck squinting at two columns of numbers and typing things in?Kurt HouseGreat question. So I like to say that KoBold runs on AI, HI and HS. So that's artificial intelligence, human intelligence, and human sweat. And the last one may be the most important. It's hugely important. And we're automating things all the time. There's all kinds of methods of automation, but these are really hard problems, because not just is the data in all these myriad formats, but what the data is requires real scientific judgment. Right? Different. A magnetic survey collected in 1965 is just hugely different than a magnetic survey collected in 1990.David RobertsSo this is not something like, you can't hire like a teenager to do data entry kind of thing. You need an expert to be looking at.Kurt HouseYeah. The things that you could easily outsource to a low skilled person that's automated, we just automate those things. But then there's lots and lots and lots of areas where human judgment is really needed. And the technology basically makes the humans much more productive. Right. Because it enables them to see, like, kinds of data fast, to see what the units were, to see what the data collection method was. It highlights the relevant information for humans, but it is definitely a human in the loop process, and it's, for all intent and purposes, will stay that way for a very long time. It requires a lot of investment.David RobertsRight. So this sounds like the bulk of your value add then, mainly like this precisely. Gathering and standardizing information.Kurt HouseI would say it slightly differently. But I think it's a reasonable assertion. I would say it's the least ambiguous value add. Right. Like, it's clearly really valuable to get all the information and make it all usable. That is like, nobody will disagree with that. Right. And so that's definitely the case, then, once we have the information, I should talk about what the data types are in a second. Once we have the information in accessible form, then there's just a huge number of scientific computing and AI algorithms that interrogate the data and do all manner of things to predict where we're likely to find compositional anomalies and concentration anomalies.David RobertsSo what are some of the kinds of data like? Presumably people have dug down and pulled up cores.Kurt HouseYeah. So we'll start with geophysics. So the earth's gravitational field changes from place to place on the planet because the density of the rocks beneath you change from place to place. Yeah, it's really cool. And you can actually measure these changes with gravitometers that existed in terms of sufficient precision for 50 years. People have been doing gravitational surveys for many, many decades in different places and different evolving technology platforms. But that's one type of geophysical data. The earth's magnetic field changes from place to place as you go around the earth because the background field gets distorted by the magnetic properties of the rocks in the near surface.There's various types of electromagnetic data that tell you something about the distribution of conductivity of the rocks in the subsurface. Right? And there's electromagnetic data that's based on active surveys as well as it's based on passive surveys. There is all manner of imagery. Right? So aircraft and satellite imagery in the visual and in the wider non visual bands. And that can tell you lots about both outcropping rocks as well as the materials overlying outlying rocks. There's all manner of chemistry. Right? So you referenced this just now. There's groundwater chemistry, there's soil chemistry, there's sediment chemistry and streams.And then there's rock chemistry, both from outcrops and from deep drill holes. Then there's mineralogic data. So chemistry tends. We use that as a shorthand for the elemental concentrations in a rock sample. So the percentage of copper, the percentage of nickel, the percentage of cobalt, et cetera, and the percentage of weird stuff, too. And those trace elements are really important. The percentage of caesium, the percentage of tantalum. Right. This stuff tells you a lot. So you end up getting, if you have 50 or 60 element concentrations, you can do some very sophisticated high dimensionality sort of machine learning to predict how the rocks are changing in the subsurface.And then there's mineralogic data, which tells you about not just the elemental concentrations, but what minerals they're in, the forms of the molecules themselves. Right. Is it nickel in silicate, which would be less interesting than nickel in sulfur? Right. And you need to actually understand the molecular form, not just the elemental concentration.David RobertsSo how close — and maybe this is like too sprawling of a question to answer, but how close are you? Well, a) are you still finding new sources of information? And b) how close are you to ingesting and systematizing and standardizing all the data that you do have?Kurt HouseThe last question, I would say we're way ahead of anyone else in terms of aggregating all of the information about the earth's crust. And we got a long way to go.David RobertsOh, really? It's still early days with the information that's available.Kurt HouseThat's available. Yeah. I would be shocked if we've already fully aggregated a few percentage points.David RobertsOh, interesting.Kurt HouseThere's a huge amount, yeah.David RobertsSo that's good reason then to think that there's lots of Runway for improvement here as more and more information comes into the system.Kurt HouseFor sure. Maybe the neatest innovation we have, data science innovation, kind of foundational innovation, is something we call efficacy of information. And what this is is we ingest all of this legacy information and we make these predictions. We have, in most cases, very sparse data, we have little hints of data here and there. So we have a huge amount of uncertainty. And the game now is to make a set of decisions that will decrease our uncertainty. That will maximally decrease our uncertainty. Right. And so that's actually the way we think of exploration. We think of it as an information problem.That's about the maximum reduction of uncertainty. No other mining company talks that way. Right? Talks about sort of information theory and maximally reducing uncertainty. But it's fundamentally the way we think of exploration, of the exploitation process. So efficacy of information technology, what it does is it actually indicates what information we should collect that will reduce our uncertainty the most. Right. Which is different than what information you should collect to find a deposit. Like, it's a different question. It's no, how do we decrease our uncertainty the most? I'll give you a fun example, a very tangible example of this.So we have a lithium prospect in Quebec. And the way we got on to this prospect was by initially searching old records for the lithium mineral that we're looking for is called spodamine. So that's an aluminum silicate lithium mineral. And so you can imagine that you'd go look for spodamine, and there's the word in old geologic records, but it turns out that that's not very fruitful. And the reason that's not very fruitful is because unlike copper and nickel, people have not been looking for lithium for all of human history. In fact, they weren't even really looking for lithium ten years ago.It is an extremely new thing, and that makes it really interesting. So most geologists weren't even thinking about it. They weren't thinking about spodamine 40 or 50 years ago. So if they weren't thinking about it, they were less likely to see it also. And this is non obvious at all, but it turns out that the spodamine mineral is really, really hard to detect in rocks, which some minerals are easy to see for a skilled geologist, and some are really hard, and spodamine just turned out to be really hard.David RobertsSo you're looking for proxies, then it's what you end up doing.Kurt HouseExactly. So we're looking for proxies, things that we have figured out through basic science and through data science that correlate with the presence of spodamine. So we found some old reports that were just littered with those proxies. So we send people out, but we didn't send them. We actually staked a big claim, 300 square kilometers of area, and this is an area that has snow on the ground most of the year. So you have a narrow window to send people out and collect new information. And it's expensive. Right. This is another cool element of the data science challenge of exploration, is that the marginal cost of data is very high.Right. And that's really different than like a SaaS company or a social media company that's getting swamped with data, and they're trying to find subtle signals in the noise. We have this high marginal cost of data, so the whole game is to collect the most useful next piece of information. So we have this big area, we have maybe two weeks in the field, helicopter supported. So this is not cheap. Ten highly skilled people supported by a helicopter for ten days. And so we use machine learning algorithms to tell them where they're likely to find the right rock sticking out of the ground.Okay? And so the algorithms were trained on data that we had a priori, and the team goes out there and they find a couple of good examples, and they say, "Yeah, this is good. This is a pegmatite. This is the sort of rock type we're looking for." And it had this white moss growing on it, it's a white like rock and has this white moss growing on it. Most of the places that the ML sent them, most of the places were not the right rocks with that white moss growing on them. They were just fields of white moss.It was bad, it was false positives all over the place. So we sent them to all. So it was really bad, right? So they're in the field and they're on satellite, and they're like, "You guys, data scientists, this is not right, this is moss, these aren't pegmatites." But that's okay, that's the way this iterative process works. So the team goes, "Okay, we have a few true positives in the pegmatites you did find, and we have lots of true negatives now, right? Those false positives are the same thing as true negatives, right? We know those are not the right things."So that's really, really good training data.David RobertsSomebody's going to go write a moss algorithm now.Kurt HouseExactly right. So we include that into the model as not the thing we're looking for, as well as some positive cases of the thing we're looking for. The model gets way better, way more predictive in just a couple of days, inside the window of the field campaign. So then the new model, while the people are still out there, the new model says, "Okay, here's a much more precise model. Many fewer predictions, some novel new predictions, many fewer predictions. Go check out these that are like 50 km away." And they were spot on. They were exactly right.And now, the model was really predictive. Just a little bit of high quality training data made the model way, way better and got people to not just the right pegmatype deposits, but pegmatite deposits that were rich in spodamine, which is the lithium bearing mineral. So that could be a new lithium discovery, and we're able to make it way faster and for way less expense because we directed the team so efficiently in the field.David RobertsRight. This kind of gets up. My next question, which is most of what you're doing, is assessing and analyzing existing data sources that you've gathered. And the next thing I was going to ask is, are you yourself producing another data set? Are you doing any sort of large scale scanning or, I don't know, whatever it would be to produce another data set. But it sounds like you're doing something much more targeted than that.Kurt HouseYes, both. So, yes and yes. So the targeted exploration is critical for efficient exploration, and then we are collecting new data, highly selective, high quality data, like I just described, like those moss covered fields good, strong, true negatives, okay? But here's what we also did, and it was really cool. We actually have a whole hardware program where we're developing new measurement techniques and new data types, and we have something we've invented called the KoBold hyperpod, which is a camera that we designed that is the highest spatial resolution and highest spectral resolution of any camera used in mineral exploration.We mount it to the side of a Cessna aircraft or a helicopter. So after we found this remote, good outcrop, we then flew over it with the hyperpod. And the hyperpod, to make this really clear, so the satellite imagery has a pixel resolution of about four meters. So it's about a four meter spatial resolution, okay. And then it had a band resolution, spectral resolution of eight different bands. So eight different wavelengths of light. The intensity was being measured. So you can imagine for a four x four pixel, you would get eight numbers, okay? The hyperpod. The new hyperpod has, in a four x four area, 20 pixels, so it has 20 times the spatial resolution.So you get 20 different pixels for every one pixel, and then every pixel has 80 times the number of bands. So it's 80 times the band resolution going all the way up to three microns, like really long wavelength. So we collect much more rich information, 1600 times as much information about that outcrop than you had from the satellite imagery. And then we fly a wide area, we fly that camera around a wide area, looking for more of the same. So in this way, the whole exploration machine becomes much more effective at every stage, because the software enabled the more effective exploration, which found the better training data.And the novel hardware then collected really good quality data, which then gets used to find the next prospect after that.David RobertsSo you're laddering up then, and ought to be getting better and better at this, basically, because.Kurt HouseCorrect.David RobertsThe more information you get, the better data you have. So we're getting close to the end. One or two other things I wanted to get before we're done. One is just about what you found so far. You said you're relatively new at this. You found one big demonstrated deposit of what is the —?Kurt HouseCopper and cobalt, mostly copper, a little bit of cobalt in Zambia.David RobertsAnd it's new that you're looking for lithium. That was a relatively recent announcement, I thought.Kurt HouseYeah, we've been — so we started looking for nickel, copper, and cobalt. And for the first two years of the company, actually, for the first three years of the company, we exclusively looked for those three. We started our lithium program about a year and a half ago, and it's a very different search space in really interesting ways, but we've spun up a really exciting lithium program. Now we're exploring on four continents. We're exploring in Asia, Australia, North America, and Africa for lithium, and we have projects on all four.David RobertsOh, wow. So you have one big demonstrated find on your record now, and you're exploring in other places. You're exploring in a bunch of other places.Kurt HouseYeah. We have nickel, copper, and lithium projects in twelve jurisdictions, I think Greenland, Quebec, Ontario, Saskatchewan, Nevada, Alaska, Western Australia, Namibia, Botswana, Zambia, South Korea. So, yeah, we're exploring all over the world for those key metals.David RobertsOkay, and final question, and this is, I'll get yelled at by my audience if I don't ask you this, which is just, we've been discussing all this as a sort of purely mechanical kind of a technical challenge, but obviously, anytime you talk about mining, I'm sure you're very familiar, having been in the space for a while, first thing that leaps to people's mind is environmental degradation and social problems. The mining there are, quite famously, a lot of bad mines, a lot of bad conditions at a lot of mines. How do you think about the equity justice angle in your work?Kurt HouseYeah, I'm so glad you asked. It's so, so important. Right. So the mining industry has a spotted history, for sure. For sure. There's some good stories and there's some very bad stories, for sure. These are things we take enormously seriously for a whole host of reasons. Sort of with the giant picture, the big picture, which, of course, we started with in the beginning, which is just humanity has a choice, right? We either get off fossil fuels or we fry the planet. And I don't think that's an acceptable choice. And so what does it mean to get off fossil fuels?It means massive electrification, and that, just because of physics, requires a lot more of these key materials. If we're going to solve climate change, we need to find and develop these materials one way or another. My view is very strong, that if the mining industry doesn't act exceptionally well in development over the next ten years, then reasonable local stakeholder opposition to any projects will thwart that effort. Right. It'll thwart the effort to get the materials. So we have to be absolutely best in class, and we strive to lead in that way. So most companies will start a major community relations program once they're there to actually develop a deposit.We start it earlier. We start when we're exploring. Right. Even though we know most of our projects won't actually come to fruition, we want to make sure the places we are exploring are places that we are welcomed and we want to be, we want to be welcomed by the locals and we want to work with the locals so that we remain welcomed by the locals. And that means a huge number of things. But it means fundamentally, it means a really serious investment, right. With an entire group inside the company that's dedicated exactly to that. And people that spend all day, every day talking to the local community about their concerns.At this point, KoBold, the majority of KoBold employees are actually in Zambia. And so one of the things we are trying to lead on heavily is to mostly hire Zambians for our major project in Zambia. It is kind of standard operations that when there's a big project like this, western companies move in and bring in a lot of expats to do the high priced jobs. We have a strong commitment to not do that. Right. We have some expats, of course, for very specific technical expertise, but mostly we're hiring local and we're training local very aggressively. And that's in our long term interest.We want to have the best zambian workforce that we can possibly have because we don't want to just develop one project in Zambia. We want to develop ten projects in Zambia. And we're investing in all the neighboring countries. And so the more capabilities we have in that country, the more effective we'll be in the neighboring countries.David RobertsLet me ask you this, since I discovered that you're an actual mining company. It's nice that you are making efforts to do this, right in terms of dealing well with the locals and labor standards and stuff like that. Is there demand side pull for better standards? Is there now a market force pushing for better standards, as one would hope?Kurt HouseGreat question, and this is a great coda here for the conversation, because I think your audience can help here. I think demanding high environmental standards and high labor standards in your key critical materials in end use products is something that every listener can do. You guys should actually tell when you buy your next iPhone, you should ask, right? Like you should ask about these things.David RobertsAre there programs or standards or certificates or something? Like what can a consumer use to know?Kurt HouseYes, there are programs they're starting. They're nascent. Right. And so they need just grassroots consumer support. Right. So right now, no products that you buy — you don't have two different prices. Like a price for a —David Roberts"Dirty phone."Kurt HouseYeah, dirty phone or a clean phone. Maybe that's impossible because maybe no one would want to advertise their phone as a dirty phone. But you definitely want companies advertising their phones as clean phones, right? You definitely want that. And honestly, I would say the diamond industry, even though I think diamond exploration is kind of stupid and wasteful, they've actually done a pretty good job here with the so called Kimberley process and things like that, because blood diamonds were a horrendous issue.Still are. But they did a pretty darn good job with that. Such that the provenance can be relatively tracked. So there are techniques, but it really requires sustained consumer engagement so that all the companies involved, so the entire industry takes it up. The providence of our metals will be exceptional. You'll be able to track every — once we're producing, our mines aren't producing yet, but once they're producing — you will be able to track every gram all the way back in the entire supply chain in an extremely transparent way. And we hope we can set an example that way.David RobertsAwesome. Well, that's something listeners can do, especially if listeners are associated with institutions. Try to get institution procurement or government procurement aimed in the right direction is a big piece of the puzzle, too. Well, Kurt, this has been absolutely fascinating. Mining is not something I thought I would ever have to get into or care about. But as you say, you pull this string and here's where you end up. So I'm glad somebody's out there working on it. Thanks for coming on and walking us through it.Kurt HouseIt was a great conversation. Thanks so much for having me, David.David RobertsThank you for listening to the Volts podcast. It is ad-free, powered entirely by listeners like you. If you value conversations like this, please consider becoming a paid Volts subscriber at volts.wtf. Yes, that's volts.wtf. So that I can continue doing this work. Thank you so much and I'll see you next time. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, wind industry analyst Samantha Woodworth speaks to the growing pains of the offshore wind industry and what its future may hold.(PDF transcript)(Active transcript)Text transcript:David RobertsLast week, for the first time ever, a commercial offshore wind farm delivered power to the US grid. It was an important milestone — and also the rare bit of good news for an otherwise beleaguered industry. Everywhere else, costs are up, contracts are being renegotiated, and projects are getting canceled. It all sounds pretty bad, especially for a sector that barely even exists yet. What’s going on? How much of this turmoil is temporary and how much reflects lasting structural changes? Is the US offshore wind industry going to die before it even leaves its crib? To gain a little clarity on these questions, I contacted Samantha Woodworth, a senior wind industry analyst at Wood Mackenzie. We talked about the converging difficulties facing the industry right now, efforts to renegotiate contracts that were signed in the Before Times, the odd role that ships play in the whole mess, and the industry's prospects in coming years and decades.Samantha Woodworth, welcome to Volts. Thank you so much for coming.Samantha WoodworthWell, thank you so much for having me. I'm happy to be here.David RobertsThis is exciting. I have 411,000 questions. The more I dig, the more questions I have. So I'm excited to get into this. It seems like we're really at a hinge point here for offshore wind in the U.S., and there's lots of sort of contradictory signals happening. On the one hand, literally today, the day we're recording, we heard that the first power from an offshore wind turbine is being delivered in New York today. So I think, unless, correct me if I'm wrong, that marks the first actual power from offshore wind being used in the U.S.Is that correct?Samantha WoodworthEssentially, yeah. I mean, it's the first commercial-scale offshore wind farm in the U.S. flowing power to the grid. It is a super-duper exciting day.David RobertsYeah, that is exciting. And also, I think just a couple of days ago or maybe yesterday or very recently, there were some announcements of new offshore wind procurement. But then on the other hand, we have all these other stories coming. So let me just, in terms of the quote unquote crisis of U.S. offshore wind, let me summarize quickly what it seems like what I've gathered is going on, and you can fill in the details and tell me if I'm missing anything.Samantha WoodworthAbsolutely.David RobertsBasically, a bunch of contracts were signed for offshore wind amidst a period of great enthusiasm in the Before Times, like pre-2019, back when things were normal, I don't know.Samantha WoodworthYeah.David RobertsWere they normal?Samantha WoodworthMore or less.David RobertsWhat's normal? But economic circumstances, let's say, were a lot better back then. So you sign these contracts, you sign up, and these projects take a long time to build. So in between the signing and today, we've had a pandemic. Inflation. Russia invaded Ukraine and screwed up the entire globe's supply chains. Now everything looks much, much, much more expensive than it did then. And so now these wind companies are stuck with these contracts premised on much lower prices, much lower inflation, much lower interest rates, et cetera, et cetera. And they're sort of scrambling.Some of them are getting canceled, they're trying to renegotiate, et cetera, et cetera. Is that roughly accurate as a summary?Samantha WoodworthYeah, yeah, definitely the shortlist of things that has kind of compounded to be a perfect storm of issues within the U.S. offshore space. And unfortunately, it's hitting hard everywhere. It's not just the U.S. offshore wind space that's getting absolutely derailed by these issues, but because the U.S. offshore wind space is so new and so young and doesn't have the robust foundation like even U.S. onshore wind does, they're definitely feeling the effects a lot harder with a higher magnitude.David RobertsGot it. So this is a global phenomenon, though. These are not U.S. specific trends here?Samantha WoodworthThat's correct, yeah. Inflation, the pandemic recovery. There's a couple of U.S. specific things related to treasury guidance and that sort of thing. But for the most part, offshore wind is feeling these effects globally. Onshore wind is feeling these effects globally. It stinks — the timing for U.S. offshore, just because we were so close to getting all of these projects greenlit, and it just was the perfect storm of poor timing.David RobertsReally terrible. Really, really terrible timing for this industry in particular. They were just like a toddler, just sort of standing up and taking their first steps and like, now this.Samantha WoodworthYeah.David RobertsWe're talking about all these different things converging. If you had to rank them, what's the sort of biggest? Is it interest rates that are the main thing here, or could you rank them? Is it all just a mess?Samantha WoodworthProject costs and the effect of inflation are probably the biggest issue that we've been seeing with the offshore space. That's obviously what's causing the projects to come to the table and ask to renegotiate contracts or even just eating those massive termination penalties with a plan to rebid in subsequent tenders. Even local governments, the states that are soliciting offshore wind, are beginning to include clauses in these solicitations that allow for projects to index their bid price with inflation as a way —David RobertsInteresting.Samantha WoodworthYeah, to help mitigate that potential for, God forbid, inflation keep going up.David RobertsYeah, I want to get back to those tenders and the renegotiations and all that in a little bit. There's some interesting details here, but I guess one of my big questions is, if you listen to a skeptic, an offshore wind skeptic, what they will say is this shows basically that offshore wind was an artifact of weirdly low interest rates. The sort of weirdly low interest rates that held sway for the past decade. And basically, they can't compete in a world of normal interest rates. Does that seem true to you? And did no one see interest rates coming?Was all this done on the assumption that interest rates were going to stay weirdly low, near zero, forever?Samantha WoodworthI would disagree with that. I mean, we've had the sort of foundational pieces in place to make offshore wind into a successful industry, including tax credits, financing regimes and that sort of thing. It is not unreasonable to think that interest rates would increase, but I don't think anyone could have predicted that they were going to just so rampantly go out of control post pandemic. The magnitude to which this issue happened is really what was causing the projects to no longer be viable. Interest rates fluctuate a lot anyway, but it's one of those things where I think this isn't something that anybody could have really predicted or should have been able to predict.It's obviously going to cause a good amount of revisiting of how these contracts are scoped and how they're written, whether that is including index bids and whatnot. But it really is one of those things where I don't think anybody could have possibly predicted, you know. 7%, 8%, 9% —David RobertsRight. The severity of it.Samantha WoodworthYeah. And if you look at Europe, too, you have commercially viable projects there that have similar remuneration mechanisms to what's being set up in the U.S., and they remained economically viable. So again, it just has to do with the nascence of the industry and not having as robust of a foundation or backbone or infrastructure as, say, in locations in Europe.David RobertsRight. Speaking of that infrastructure, let's talk a little bit about the supply chain. So there's sort of two supply chain stories, and I'm curious how they apply to offshore wind. One is just Russia invading Ukraine, you know, and then cut off the gas from Russia, and then everybody's scrambling for clean energy, and basically supply chains get jammed up in a way that is screwed up everybody for a while, screwed up all industries for a while, but particularly this industry. That's one story. And then the other story is just specific to offshore wind in the U.S., which is just, we don't have the supply chain in the U.S. yet, just because, as you say, the industry is nascent.And now we have these laws sort of mandating that we have to use domestic content or use domestic manufacturing or use domestic ships, which we'll return to later. So now the industry is having to wait on a supply chain standing up. Which of those is responsible for the current woes?Samantha WoodworthI think it's a combination of both, really. I mean, like I had said, the whole renewables industry is feeling the effects of the supply chain disruptions caused by the pandemic, as well as caused by the conflict between Russia and Ukraine. As you mentioned, the local supply chain, especially for offshore wind in the U.S., is pretty non-existent. As it stands now, there are a number of idle facilities and newly proposed facilities that are being thought of to help address that. Unfortunately, even if all of those come online, we would need more to be able to meet demand.But it's a very good start. That being said, I think it was Siemens Gamesa announced that they're no longer planning on building a blade manufacturing facility in the U.S. because of just how volatile the offshore wind market has become here and how —David RobertsUgh.Samantha WoodworthYeah, I know, it's a huge bummer — how projects are no longer guarantees at this point.David RobertsWell, this is a chicken and egg thing, right? I mean, the problem with the supply chain.Samantha WoodworthYeah. And no one wants to spend millions of dollars to create a new manufacturing facility if the demand isn't going to be there for several years later if the project's delayed, God forbid, the project gets canceled. Right. So that's definitely one of the big issues that we're running into in the U.S. as far as just even establishing that local supply chain. We have a decently robust supply chain for onshore, but obviously we really don't have anything that can quite cater to offshore yet, just the scale and the scope. So we really need to make sure, especially this latest tranche of projects that are getting awarded, like New York's third auction, that the preliminary winners were announced a couple months ago, I think.That as well as New Jersey, Massachusetts, Connecticut, Rhode Island, you know, the onus really is to get the pricing of those contracts right so that we can have that certainty in the project pipeline again, and therefore convey that certainty into establishing a robust supply chain of labor, of manufacturing, of port infrastructure, of ships, of everything we could possibly need to really foundationally have it.David RobertsAt the same time, if you're proposing a project whether and how much that stuff will be available is very germane to the price you can ask. Right, this gets back to the chicken and egg thing. In a sense, you need that stuff around, or at least some idea that it's going to be around before you can properly assess your own project.Samantha WoodworthYeah, but you know, we kind of knew going into creating this industry that we were going to be heavily reliant on Europe for not even just best practices, but being able to source these components because they have most of the offshore wind manufacturing in Europe and we were already going to be reliant on them for vessels, installation vessels anyway. So you can kind of get an idea of what these projects are going to cost. Just knowing where you would have to source supply chain at first, really the kind of question becomes, "all right, if we were to build these in the U.S., how would the costs be different? And what certain standards do these local supply chain and these local manufacturers have to adhere to?"Actually, with regard to that Siemens Gamesa cancellation of that facility, they're still planning on honoring all their contracts and their firm orders with U.S. projects. They're just saying that they're going to have to be imported from Europe.David RobertsInteresting. So on the one hand, you have this perfect storm, right? You have interest rates making everything more expensive, you have inflation making parts, et cetera, more expensive, all this stuff. But on the other hand, you also have, just a couple, a year ago, the passage of IRA, which contained — the Inflation Reduction Act — which contained kajillions of dollars for green projects, I assume has a lot of money available for offshore wind, a lot of money available for onshoring of manufacturing. Like all that stuff is getting showered with money right now. Is that money just not enough to — is the support in IRA just not enough to sort of offset the severity of all this stuff that's happening?Samantha WoodworthThere's definitely a piece of that. I think, again, nobody wants to be the 100% footing the bill for all of this. Right? And I don't think that the way that the feds are looking at it is necessarily the same way that each state individually is looking at funding and getting all of these programs and infrastructure in place. And a lot of states are kind of acting in a vacuum too. Until very recently, with that three state, at least procurement, consortium that Rhode Island and Massachusetts and Connecticut are doing. That's the first regional agreement to actually do these projects together and will likely spur regional supply chain development, as opposed to just state by state supply chain development, which is going to be really good.But it seems like in trying to get all of this stuff established again, nobody wants to be the only one footing the bill, but it seems like each entity that's trying to get it established is operating kind of within its own vacuum.David RobertsYes. For a policy head like me, when I hear this, like, all these chicken and egg problems like, this can't happen until this happens. This can't happen until this happens. I think, hey, what about government?" What about some planning? What about some policy here? This seems like a great. But I thought IRA would have done some of that.Samantha WoodworthYeah, and that's the thing. It obviously promised a whole bunch of money towards it, but ultimately, we haven't really seen anything like an offshore wind working group or like a supply chain working group, or there haven't been any sort of results like that that have stemmed from the Inflation Reduction Act. So I would agree and say there needs to be more actual action taken. I mean, yes, you can try and throw money at problems and hope they go away, but really, there needs to just be a whole bunch of stakeholders sat down at this table to figure out, okay, realistically, how is this going to work?And realistically, where is the money going to come from?David RobertsIt's like, the bill looks a lot bigger than it did, and now you got to get back together and figure out how to divvy it up. I want to return to policy in a little bit, but in the context of all this other stuff, how big a problem is NIMBYism for offshore wind specifically? I know sort of legendarily the first offshore wind project off of Cape Wind.Samantha WoodworthOh, the Cape Wind project yeah.David RobertsJust got mired in NIMBY BS for years and eventually died.Samantha WoodworthYep.David RobertsAnd I know there's been fights like that. Is that a big piece of the puzzle in the current woes?Samantha WoodworthSo actually, it's kind of funny you bring Cape Wind up. I was an intern at the New Bedford Economic Development Council back when that project ultimately got mothballed. And I had asked the same questions, too, because it seemed like policy wise, everything was in place; they were ready to break ground. This was going to be such a boon for the New Bedford economy, and then, as you know, it just kind of fizzled out and died. And NIMBYism was a large piece of that. The reason that it is a bit less of a piece now when we're talking about U.S. offshore wind today is just purely based on the location of the projects.Cape Wind was going to be in state waters within sight of Nantucket and Martha's Vineyard instead of out on the outer continental shelf where it'll be visible somewhat, but not as in your face as the location for Cape Wind would have been.David RobertsYeah, these are like 40 miles out or something crazy like that, right?Samantha WoodworthExactly.David RobertsSurely you can't see a turbine that's 40 miles away, can you? I don't know.Samantha WoodworthYeah, I'm not sure.David RobertsIt doesn't seem like it would be particularly oppressive in your visual field.Samantha WoodworthYeah, I think you would need some binoculars or a telescope or something if you want to be that mad about it.David RobertsAre there problems where — because it does seem like the one place where NIMBYism could happen is all these farms need cables going to the shore at some point and that is some degree of disruption. And I remember reading — I don't remember the specific project, but I remember reading about a community that was rallying to fight having a cable from an offshore wind farm come under their town. Like at the end of the project, it literally wouldn't even have been visible. Just digging up and burying it. They fought and fought and blocked. Is that a pattern or is it?Samantha WoodworthYeah, the NIMBYism has definitely evolved away from the "I don't want to see the turbines" piece — obviously that still exists. But a lot of the NIMBYism pieces that we're hearing about are exactly what you said: Local towns, municipalities not wanting gigantic cables put underneath their lands, having the disruption of that construction as well as there have been a whole bunch of unexplained whale deaths and people are trying to attribute those to the pre-development sonar activities and things that are done for site assessment.David RobertsI was going to ask later about the whales, but let's just talk about the whales. Is that BS? Is there anything to that?Samantha WoodworthSo NOAA has been documenting an unexplained mortality event in humpback whale populations in the northeast for years and years and years now, well before even Block Island Wind Farm was developed. You know, I personally don't believe that offshore wind farms are killing whales, but you could make the argument that because a lot of these whale deaths are attributed to ship strikes, increased construction activities in offshore wind project areas could, in theory, cause more ship strikes, which then would cause more whale deaths. There has not been any sort of research or tracking that has said that that is the case. But it is also such a new thing that there's also not a ton of data monitoring ship strikes at offshore wind project sites.And I mean, no one in the offshore wind industry wants to kill whales. Let's be real.David RobertsAre there ways to — I mean, I guess if we don't have a lot of data and a lot of science about this we probably don't also have a great idea how to avoid it. But are there better and worse ways to do this, ways that are more or less whale friendly?Samantha WoodworthAll these projects have contracted with biologists and researchers and that sort of thing to analyze whale migratory patterns. What sort of marine life of all kinds is going to be impacted by these activities? It's kind of just more monitoring and making sure that if all of a sudden you're getting a ping that there's a whale in the vicinity, you make sure you give it a wide berth until it's gone on its way.David RobertsWhat about the disruption of fisheries? Because that's been a thing, too, isn't it?Samantha WoodworthYeah, definitely. And I think, obviously, again, the offshore wind industry isn't in it to make it so fishermen can't make their livelihood scalloping — whatever they might be fishing. But at the same time, there's always going to be some sort of impact, right, to marine life, to fisheries, to anything in the ocean when you put up these massive projects. The onus is obviously on the developer to make sure that they're mitigating as much of the disruption as possible. And that's why they have — it's called the NEPA process — that's why all these projects go to open comments multiple times, they get redesigned multiple times to try and minimize that impact on user groups as well as actual, like, the environment.So obviously, we have to have trust in the developers that they're doing everything they possibly can here to minimize that impact on user groups and the environment. But at the same time, they have a legal responsibility to do that.David RobertsAnd I've heard sort of, like, vaguely over the years also that sometimes offshore turbine platforms can sort of induce fish. I'm so out of my depth here. I have no idea what I'm talking about.Samantha WoodworthLike, create new marine ecosystems?David RobertsCreate a habitat. Thank you. That's what I was looking for. Create a habitat for fish. Is that true?Samantha WoodworthIt's not something I don't think really gets considered very often. But you figure in a lot of areas, they will strip down and sink aluminum car frames to create new reefs. If you're creating a new stable, kind of unmoving foundation down there, the ecosystem will adapt. And if it likes the components, I guess there's no reason to think that the ecosystem wouldn't grow around the foundation of an offshore wind turbine. It wouldn't create a new reef somewhere, or that sort of thing is definitely something that can happen. And I think it will. I think it's one of those things that it kind of gets overlooked that these will create additional habitats once they're put in.It's not like we're going to be pulling them out every ten years for maintenance or anything.David RobertsOne of the things I've been talking about a lot on the pod lately is this problem of NIMBYism and preparing developers better for it and how current practice is not great among developers. They're not particularly sensitive. They're not doing the early outreach that they need to be doing. They're not cognizant of the political climate into which they are wandering unprepared. So they're getting chewed up. What's the story there in the offshore wind industry? Does it seem like they are sensitive to the NIMBY issue and doing what they need to do to avoid it? Or are they kind of like stepping on rakes because they're not clued in about this?Samantha WoodworthIt kind of depends, developer to developer. We have definitely seen some developers that do a better job of it than others. I think it was really hard for the industry to conceptualize NIMBYism as it's evolved away from the "I just don't want to see the turbines." And once that became no longer the issue, I think there was a little bit of a pause. Kind of a "oh, there are other issues that people have with this?"David RobertsI mean, I can't believe people have an issue with a cable going under their town, even though I know it. So I can imagine trying to anticipate that could be difficult.Samantha WoodworthYeah. And I think that's really what it was, is once we all thought that the turbines were so far offshore you can't see them, so it shouldn't be an issue anymore. I don't think anyone was really able to anticipate what other sort of local opposition stances there would be. Naturally, the grassroots environmental concerns exist across the board, but that's something that all renewable energy developers have a decent amount of expertise with at this point.David RobertsWell, also, as I keep pounding the table, this is not spontaneous resistance that is happening in these places.Samantha WoodworthExactly.David RobertsIt's very well funded. You just have to assume it's going to be there because there's a giant well-funded movement making sure it is there.Samantha WoodworthYeah, and I think there probably was a little bit of the industry being taken aback by all the new local opposition stances that came up. But again, the onus is on the developers to make sure that they are doing an adequate job of mitigating disruptions to stakeholders due to these projects, as well as making sure that they are designing their project in a way that tries to make everyone happy. Obviously, it's not really entirely feasible to make everyone happy, but you want to get darn close.David RobertsYeah. What would make a wealthy community happy about something underneath their town? If you can't even imagine why they're mad, it's hard to imagine what would make them happy.Samantha WoodworthThat's definitely a piece of it, too. Those sorts of —David RobertsJust money? Like, they already have money. Right? They're rich.Samantha WoodworthWell, and you figure that's, I think, when you start to see the developers coming out with pledges as far as, like, economic development and we'll build a school.David RobertsBenefit sharing. I have a whole pod coming out on that. Yeah. I was just wondering if that, how sort of evolved that thinking is in this particular industry.Samantha WoodworthYeah, that's, I think, the next step at that point when you're like, I can't not put the cable underneath your town, but here I will do something good to bolster the town's economy and the town's resources and whatever. That's when you start getting into that benefit sharing piece and honestly negotiating permit approvals, especially at the local and municipal level, based on that sort of benefit sharing.David RobertsJust for listeners' benefit: So some of these wind farms, the proposals in various stages, some are in areas with wholesale energy markets, restructured utilities, as they say, where there's competition among utilities, and some of them are taking place in old school, vertically integrated monopoly utilities. And I think this is an interesting difference. So right now, the ones that are in the restructured areas, listeners will know if you're in a competitive wholesale market, you're just bidding your power, you're offering your power, and the state is choosing the lowest bid. It's a competitive process. So in those areas —So what's happened, as we said, is these big farms came in, they entered these auctions, won these auctions by saying, "we will offer our power to you, New York, at x per kilowatt hour." And now everything's gone wrong, and they cannot possibly sell power at those prices anymore. And they've been trying to renegotiate those PPAs, those off take contracts that they settled, but, like, New York, for instance, just said "no," refused to renegotiate, and now these two projects in New York have gotten canceled. So I guess one of the things I'm wondering is, what are the dynamics there?Why wouldn't New York renegotiate? What is the source of the resistance? I guess if you have an auction, and someone wins with a deceptively low price and then comes back to you afterwards, it's like, "actually, I want more money." It kind of screws the other participants in the auction. But what are the dynamics there? Why don't states want to renegotiate?Samantha WoodworthTo your point: That's a good piece of it is — you don't want to discourage the competition by allowing somebody who bids, let's say, an unrealistically low price, which I don't necessarily believe any of the winners of the previous New York auctions did. I think they bid prices that worked at the time. But part of that is maintaining that competitive process. I know that NYSERDA has been batting around the idea of doing a very quick fourth solicitation; they're calling it like a "fire" solicitation, that would allow those projects to essentially rebid as soon as that solicitation is opened.David RobertsLet's just review the facts real quick. If people have not been keeping up, there's two big projects, both by Ørsted that just got canceled.Samantha WoodworthRight. Are you talking about the ones that the PUC denied their renegotiation, or are you talking about the ocean wind projects that Ørsted just came out a couple weeks ago and said, "we're not doing these anymore."David RobertsOh, are those different?Samantha WoodworthYes. Yeah. So the two projects, the Ocean Wind projects that Ørsted just recently canceled, are located in New Jersey.David RobertsOh, New Jersey. That's what I meant. Right, right. Those are the two big canceled projects that everybody's very angsty about. And they got canceled because New Jersey wouldn't renegotiate the PPA, right? So is the idea to have another auction, is the idea that these same canceled projects might bid into this new auction and win it and then be able to go forward after all?Samantha WoodworthSo I don't believe that the Ocean Wind projects got canceled because of the PUC. So the ones that got canceled because the New York PUC denied renegotiation, that was Empire Wind, Sunrise Wind, and Beacon Wind 1 were the projects that had petitioned the Public Service Commission in New York to renegotiate the contracts. The Public Service Commission said, "nope, we're not letting you do that." Then they announced the winners of the third solicitation, and there had been some mention of a very quick follow up solicitation to, in theory, let those projects that wanted to renegotiate, cancel, eat the contract termination fees and rebid in such a quick succession that it, in theory, wouldn't affect their project timelines.David RobertsRight, assuming they win.Samantha WoodworthYes, exactly. Assuming they win.David RobertsSo those projects are not 100% for sure canceled.Samantha WoodworthCorrect.David RobertsThey're just in limbo-ish?Samantha WoodworthEssentially, yes. Developers haven't come out and said we're canceling. They haven't come out and said we're breaking our contracts and hoping to rebid. There's just been kind of radio silence from those projects.David RobertsI'm sure there's a lot of angsty meetings happening in a —Samantha WoodworthI'm certain, I'm certain.David RobertsWhen we talk about these contract cancellation fees, is that a substantial hit to them? Like, is that something they would really rather avoid?Samantha WoodworthOh, definitely. I believe Commonwealth Wind is likely to pay something along the lines of $50 million, close to it, for terminating those contracts. South Coast, I believe, is paying a little bit more than that. So, yeah, it really highlights just how much project costs have become an issue with a lot of these projects and how bad the inflation problem has affected these projects, because if you're willing to eat $50 million —David RobertsI was going to say you have to be pretty desperate. So those three New York projects are right now trying to figure out, "do we just cancel and eat everything, or do we just eat the contract cancellation cost and rebid and try to keep moving forward?"Samantha WoodworthExactly. Yeah. And I think that all hinges upon, obviously, whether or not NYSERDA does this flash solicitation that they'd been hinting at.David RobertsI have no idea how long that process takes. Could they do it quickly?Samantha WoodworthThey're going to have to get their ducks in a row really fast if they want to do it in the kind of near future. Generally, the RFP process can take anywhere from, I don't know, like eight-ish months to over a year just because you're in theory, supposed to release a draft and then allow for public comments. So it is a long process by design. So it'll be interesting to see, you know, kind of what they can do in a very quick timeframe or what they're expecting to be a quick timeframe.David RobertsSo those three New York projects are in limbo. The two New Jersey Ørsted projects are just flat canceled?Samantha WoodworthYes, those are flat out canceled. Ørsted cited project delays, permitting timelines, and inflation as the primary reasons.David RobertsPermitting timelines. I thought that had, like, I thought by the time they were at this stage, they would have had the land, or I guess it's not land, ocean land. What do they call it out there? They would have had what they need in terms of permitting, like they're still waiting for?Samantha WoodworthI think generally when they say permitting in that regard, they're looking for those state municipal, local level permits for that interconnection infrastructure where it makes landfall, especially if it has to go through any sort of sensitive habitats like marshlands and that sort of thing. Ocean Winds, neither of those projects had gotten altogether that far in the BOEM permitting process. They were still doing environmental reviews. Their construction operations plan hadn't been approved yet, so they were still kind of in the middle of that whole permitting process.David RobertsJust for listeners. BOEM is the Bureau of Ocean Energy Management. That's in charge of federal waters. And all of these post Cape Wind, all these projects are far enough out that they're in federal waters, right?Samantha WoodworthCorrect.David RobertsSo here's a thought I had, or a question I had. If you're in a wholesale energy market and you're in a competitive market and all your costs go up and you have to renegotiate your contracts, you're just like, it's a mess for you. But if you're in a vertically integrated regulated monopoly utility area, isn't this a little easier for you because you can just offload the increased costs onto your captive ratepayers? Is that — are they having an easier time?Samantha WoodworthSo in theory you can. It's the Public Utility Commission's job to make sure that you're not unduly burdening ratepayers with your cost recovery. But as we kind of saw with the Coastal Virginia project, there are a number of cost overruns, and unfortunately, they are going to end up ultimately passed to the customer. And that is kind of the big difference there, is that the utility still has to go through the process of proving need and necessity and public good of the project and getting the cost recovery approved by the Public Service Commission. So the burden of proof is on the developer, on the utility at that point.But ultimately, if that gets approved, the effect is going to be felt by ratepayers, whether, you know, up or down.David RobertsYeah, it's like the Vogtle nuclear plant in Georgia. Right?Samantha WoodworthExactly.David RobertsThey weren't competing with anyone. There was no auction. It was just them and the regulators. And they're, "ah, costs are going up again." And the regulators are very chummy with them. They're like, "yeah, take it out of the ratepayers," but at least then the projects go forward, right? At least those projects would go and get built.Samantha WoodworthYeah. So that at least at the very end there, you have a pretty much guarantee that the project is going to get built in some form or fashion because generally the utilities, too, will also tie in other, a bit more contingency planning into it in that regard. They're going to kind of tend to — I would say err on the high side of costs — when they present their numbers, as opposed to when you're in a competitive bidding scenario. You want to bid low cost.David RobertsRight, right, right. You say now that they're talking about doing a process where bids are tied in some way to inflation rates. You say that's standard in Europe?Samantha WoodworthWell, there isn't much, actually that's standard in Europe as far as remuneration mechanisms go. It really varies market to market and country to country. But at least in the Massachusetts, the most recent tender that they released, as well as the draft materials for the upcoming Rhode Island and Connecticut tenders that are being put out as part of that tri-state consortium or tri-state regional procurement, those all allow for developers to submit — you can either submit a fixed bid like you normally would, or you can submit an indexed bid. There's different stipulations around each that are very, very in the weeds, so I won't bother going into them.There are certain criteria you have to meet and to do if you want to do an indexed bid versus a fixed bid. But allowing for that indexation to inflation is obviously a good option, especially considering no one wants to think about it. But God forbid, like I said, inflation keeps going up.David RobertsYeah. If we've demonstrated anything in the past few years is that no one, including the alleged experts, has any friggin idea what's going to happen to it. So it does seem like indexing is good, although I have to say from a state's perspective, you want to be careful saying "we'll pay no matter what happens with inflation."Samantha WoodworthWell, that's why I'm saying there's other stipulations around it that, like I said, it goes really into the weeds. But that's just one way that some states are trying to address the issue of "if inflation skyrockets again, none of these projects are getting built." They want to obviously avoid that. The states have already said — they have targets, they want offshore wind energy. They've put a lot of money and investments into the industry already. So having projects get scrapped is really not good on them or for them either.David RobertsYeah, I mean, the backdrop to all this, I mean, maybe you and I probably know this, but it's just worth saying. It's just like the northeast in particular really needs some new power. It's very congested and very — this is not some luxury for them. They badly need these things. Tell us, what is the deal with ships and the Jones Act? What's going on there?Samantha WoodworthSure. Yeah. So, the reason the Jones Act was such a big talking point for the offshore industry is that it essentially precludes foreign vessels from being able to go into U.S. waters, U.S. ports, pick up components, and bring them to the project site for the offshore wind projects.David RobertsWhat exactly does it say? It's illegal for a foreign ship to carry from a U.S. manufacturer to a U.S. consumer, like a U.S. to U.S. trip. Is that specifically?Samantha WoodworthEssentially, yes. So, the whole point of it was to kind of prop up the U.S. shipping and shipbuilding industry years and years ago by making it so that any shipping activity that happens within U.S. waters between U.S. ports has to be done by U.S.-built and U.S.-flagged vessels.David RobertsYes. And so now what's happening is you need special ships for these things, yes?Samantha WoodworthCorrect.David RobertsAnd we don't have them?Samantha WoodworthCorrect.David RobertsWhich is like a real problem.Samantha WoodworthSo, you know, we have the one vessel that Dominion's building, Charybdis, that was supposed to be done this year; unfortunately, due to supply chain troubles —David RobertsDoh!Samantha WoodworthYep. I don't know, did you see that one coming? You know, the timeline for that has been delayed somewhat, I think, to next year, maybe even 2025. I'm not entirely sure on that one.David RobertsOne ship is not going to do the job, presumably.Samantha WoodworthThat's the thing. And so there was a proposition at one point that was going to say all the foreign installation vessels that we bring over have to have either a full U.S. crew or a crew flagged from the vessel's hailing port. Obviously, that's like another bunch of hurdles to jump through when we're trying to attract European vessels to come across the pond and do these projects for us. That provision never passed, thank goodness, because honestly, it probably would have choked the offshore industry a lot.David RobertsWell, how is this not just going to bring everything to a halt? Is there any way around this? You can't build one without a ship? We don't have the ships. It's illegal to bring a ship over from where they're building ships. What's the solution to this puzzle?Samantha WoodworthSo there's two hypothetical workarounds. The first is what was used to do Block Island Wind Farm, the Coastal Virginia Demonstration Project, which was to basically ferry things back and forth from a foreign port. So they set up in Halifax. And —David RobertsAh!Samantha WoodworthYeah, obviously not really a very good solution.David RobertsNot economically ideal, let's say.Samantha WoodworthEspecially if you're trying to build an 800-megawatt wind farm, as opposed to a 20-megawatt wind farm.David RobertsRight.Samantha WoodworthSo that was the first of the suggested workarounds. Scalability, obviously, huge concern with that one. The current workaround that's being used for the Vineyard Wind Project is to have U.S.-flagged feeder barges and a foreign installation vessel. So instead of having the installation vessel come to port and pick up components, the installation vessel just stays stationed at that project site, while the U.S.-flagged feeder barges are the ones going from project site to port to pick up these components. Then you transfer them to the installation vessel and then it gets installed that way. Obviously not ideal either, but —David RobertsEvery economist in the audience right now is getting hives.Samantha WoodworthI know, I know, I'm sure. Obviously not ideal, but when we look at Vineyard Wind specifically, actually, another piece of good news for today is that the first five turbines of that project already installed, and they're planning to flow power very soon. That project wasn't really adversely affected, timeline-wise, by using this feeder barge workaround.David RobertsThey did the barge thing and it worked.Samantha WoodworthYes. It didn't seem to really impact the actual construction timeline at all. Obviously, it's going to be a bit more expensive because not only are we paying a premium on getting the foreign installation vessels.David RobertsYeah, you have to get the vessels anyway. Like, you still have to get them.Samantha WoodworthYeah. And so obviously we have to pay a premium to incentivize European vessels coming over here because they have a ton of demand in Europe anyway. So it's going to be a bit more expensive using that workaround because you're paying a higher day rate for the installation vessel as well as the day rates for the barges. But at least it's not impacting timelines detrimentally. Or at least it hasn't in the one example we have. So it is a viable workaround is what we've learned.David RobertsSeems so crazy, though. Is there no prospect or chance of Congress just like for once doing a think, you know, they could just sit down and in five minutes pass an amendment to the Jones Act. You know, saying, "except for offshore wind." Is that not even on the table?Samantha WoodworthYeah, it's not really on the table. It is funny, and a little sad, because obviously the whole point of it was to prop up the shipping and shipbuilding industries in the U.S. The U.S. shipbuilding industry has just continued to decline. But that was always the question when this issue first got brought up was whether or not they would ever pass an amendment. And it was a pretty emphatic no, because it is a policy that is rooted in nationalism and a lot of people in government still believe that it is a good policy.David RobertsSo then are we going to get a shipbuilding industry? Like, is there anything on the horizon other than the one, the one ship?Samantha WoodworthThat's the interesting piece. Right. So we have the one ship that is going to be done within the next year or so. There haven't been any contracts signed about or like to build additional Jones Act installation vessels. There have been a lot of proposals and potential contracts, expected contracts around other hybrid vessels related to maintenance and that sort of thing, which, you know, obviously equally as important, once the industry gets off the ground, you don't need the installation vessel really anymore. You need those Jones Act compliant operations and maintenance vessels. So having those is going to be really important because we know that feeder barge workaround works.We can get these projects built even if we don't have more Jones Act installation vessels. A lot of the problem, though, has to do with just shipyards being able to build these. So there is a continuous kind of arms race going on in the offshore industry right now about bigger and better turbines.David RobertsYeah, I was going to ask this. What are you even building the ships for? Right. It seems like a moving target.Samantha WoodworthYeah. So most of the fleets that would be available to the U.S. right now can install turbines anywhere between 12 and 14 gigawatts in size. But we're already hearing talk of 16, 18, 20 gigawatt platforms coming in the future. So obviously, the bigger the turbine platform, the bigger the ship is going to need to be. In theory, Charybdis is supposed to be able to install those 16-megawatt turbines. But Keppel AmFELS, the shipyard where it's being built, is one of only a handful that can handle ships that big. And the other ones are contracted for military contracts and are unlikely to want to pick up a commercial vessel contract.David RobertsInteresting.Samantha WoodworthThey've already got cushy navy contracts, so why would they bother building a commercial vessel of that size.David RobertsEspecially in an industry that is in spectacular turmoil.Samantha WoodworthExactly, it is kind of another chicken and egg problem, in a way.David RobertsThat is just — what a dumb, what a dumb problem to have. It's just so dumb. So, long story short, you anticipate us hacking our way around this for the foreseeable future with barges.Samantha WoodworthYeah, exactly.David RobertsWell, that's ridiculous. But such is life. One question that comes up a ton, especially as I live out here in Seattle, is about west coast wind. You know, all the action and all the news stories are coming out of the east coast, they're way ahead. But there's a lot of thinking, dreaming out here on the west coast about offshore wind. Where is that? Is it just a gleam in our eye? Is somebody doing something? Are there laws being passed? Are there companies bidding on anything? What's happening on the west coast?Samantha WoodworthSo we had the California auction — I think that was towards the end of last year, and that was a pretty well received, well subscribed auction. California has its super ambitious offshore wind targets. Oregon has their more realistic, I'd say, offshore wind target. So obviously, the whole industry out there is expected to be floating, just given the water depth.David RobertsYeah. Just for listeners' benefit, on the east coast, they have a nice little shelf off the coast that's relatively shallow, so you can just put concrete foundations on the floor of the ocean. West coast of the U.S., it drops off like a mile or two offshore to be very deep. So you can't put anything on the floor.Samantha WoodworthExactly. So, you know, the option for technology would be floating wind turbines that are just anchored to that deep, deep, deep seabed. Floating technology is still kind of in the commercialization phase in Europe.David RobertsIs there an operating commercial floating wind turbine anywhere?Samantha WoodworthThere's a few, I believe, in Denmark and maybe Germany. But overall, the technology itself is still in the commercialization phase, still trying to figure out, "okay, is this economical? How can we do this economically?" Especially just because floating, it takes so much more of everything than fixed bottom does. More labor, more steel, more concrete, literally everything, more space.David RobertsWhy is that exactly?Samantha WoodworthThe technology is a bit more complicated because you need to make sure that you're ballasting everything right, so it's not going to capsize in the first heavy gale. And as far as needing more space, you are constructing these turbines port side and towing them to where they're going to be anchored. You're not constructing them at the project site.David RobertsBut then you don't have the ship problem, right?Samantha WoodworthThat's true. You don't have the ship problem because we have lots of U.S. flag tugboats. But, yeah, you don't have the ship problem. But then you run into the issue of you just need exponentially more port space to be able to construct these massive turbines and then tow them out of the harbor. So it has its own specific set of constraints and problems and idiosyncrasies, if you will.David RobertsHow close is that? Is there a port that could do it? Obviously, based on everything we've said to date, no one really knows, and it's very up in the air. But when might this happen?Samantha WoodworthA lot of retrofitting would need to happen to any port to be able to construct floating offshore wind. But we have some very good, large ports on the west coast that are already hubs of wind energy imports, like Long Beach, Los Angeles, even like Vancouver, Washington, Portland, that sort of thing. You know, it's definitely doable. It's going to take time, though, and I think it's going to take a lot more time than anyone really wants it to, naturally.David RobertsWell, you have to get the ports ready. You have to settle this technology question, I guess. You got to get bids like all that just based on how long it took on the east coast. It's hard to be super optimistic.Samantha WoodworthAnd, I mean, I know California has tried very hard to implement policies that would allow for fast tracking of these projects, at least through the paperwork phase, as it were, so they can start getting more focused on the physical infrastructure needed. But I think they're also still trying to figure out how the contracting mechanisms are going to work in CAISO. And frankly, they have enough problems with their electricity grid as a whole with integrating the exceptional amount of renewables that they're targeting.David RobertsWell, like some steady baseload offshore wind would be super helpful.Samantha WoodworthIn theory, yeah, as long as the existing wires can handle that much power. So California has its own grid struggles that it needs to address first, I think before it can really think about actually making these projects into a reality, I think they're going to be able to do it. I think it's going to take —David RobertsWhen is the target in law? Like, what are we saying we're aiming for?Samantha Woodworth5 megawattts operational by 2030, and I think it was —David RobertsThis is California?Samantha WoodworthYes. 5 gigawatts, rather, by 2030 and 25 gigawatts by 2045.David Roberts2030 is not very far away.Samantha WoodworthNo, it is not.David RobertsDo you think there's going to be 5 gigawatts of operational offshore wind off of California by 2030?Samantha WoodworthI do not think so. I think we will have one to two projects operational by then, but I don't believe we will be hitting 5 gigawatts.David RobertsIt just seems like on both coasts, there's just this hump you need to get over. You need to get the supply chain going and then build a few projects, and the costs come down each time you build a project. And the costs come down each time you scale up your manufacturing. And it just seems like there's this hump we need to get over, and things will get smoother once we're on the other side of it. But, man, it's a big hump.Samantha WoodworthYeah. And I mean, obviously the hump got a lot bigger with all of these unforeseen circumstances, post pandemic and whatnot. But we all kind of have to remember that these are the same, or at least similar growing pains that the U.S. onshore industry went through in its infancy. Storage is seeing similar growing pains right now. Solar had their fair share, too, in the infancy of that technology. So the growing pains, I think, seem a little greater in offshore just because the projects are so much bigger and so much more expensive and require so much more —David RobertsAnd we have less time and we have ambitious targets and we have a lot more media attention on the whole thing.Samantha WoodworthExactly, exactly. But as we've seen before in all the other technologies, you know, we can get these industries going in the U.S. and we can get them going in a sustainable way. So I don't really have any doubt that that's what's going to happen with offshore. We're just really in the growing pains phase right now, and it just happened to coincide with a really, really, really bad bunch of macroeconomic issues.David RobertsWhat about the Great Lakes? Is that a real thing?Samantha WoodworthSo the Great Lakes is kind of interesting. I know that Icebreaker — Ohio regulators, I think, early last year approved the project, which was totally not expected by anyone, including the developers of the project, who said, "oh, no, we need to do this now. We got to get the wheels spinning again."David RobertsIf you were building on the Great Lakes, would that be a standard platform hooked to the seabed, like just the kind they're building off the east coast? It wouldn't be any special technology or anything?Samantha WoodworthYeah, it's a fixed bottom. It's also state jurisdiction, obviously, instead of federal jurisdiction. So these are all — would be significantly smaller projects. I think Icebreaker, at most, it was going to be 20 something megawatts.David RobertsInteresting. But they're doing it. They're moving forward.Samantha WoodworthYeah, in theory, that one's moving forward. It's been radio silence since that approval. But Canada, Manitoba had looked into doing Great Lakes offshore wind way, way, way back in the day and then kind of tabled the whole thing because they said they needed to do more environmental reviews, since obviously the Great Lakes are a source of water for —David RobertsYeah, I can only imagine the NIMBYism that's going to take hold when this gets well.Samantha WoodworthAnd that's why Manitoba has a moratorium on offshore wind development in the Great Lakes at this point, while they do more research and that sort of thing. But that moratorium has been in place for, I think, like ten years now. So that one's going to come with its own set of hurdles, especially as it pertains to the fact that those lakes are drinking water for millions of people. So you're definitely going to have, permitting wise, a significant number more hurdles. But for powering load centers like Chicago and that sort of thing, I think it would be very, very beneficial.David RobertsVery handy. But if I had to pick one that's going to take longer than anybody thinks. That would be my bet.Samantha WoodworthExactly.David RobertsOne other thing. What about, and this is something I wrote about, jeez, when I was back at Grist, I want to say in, like, the mid-2000s, this idea of an east coast transmission backbone out in the ocean, that you just sort of hang projects off, because obviously, if every project has to build its own connection to the shore, that's NIMBYism, that's money, that's time. And if you could just connect to this backbone, and there could just be one or a small number of big connections to the shore, then it seems like you'd open up, you'd make things a lot easier for subsequent projects. I've heard talk about that for ages.Is that real? Is that going to happen?Samantha WoodworthSo that's definitely something that we've heard from both, like, New Jersey and New York. We're talking about doing a meshed grid system for their projects. And there are a lot of positives, let's say, about doing it that way because it's beneficial both to grid reliability, but it's also beneficial to the project, like asset owners as well, because essentially the way it works is that you have that grid interconnecting at multiple points on land and also connected to multiple projects. And so basically, if one point on land has too much power flowing to it at one time and it's congested, but another point needs more power, you can shift what point that power is getting or where that power is getting flowed.David RobertsThe whole east coast becomes one big shared grid.Samantha WoodworthYeah. And honestly, I frankly think that is a brilliant idea, and I hope that it gets built, because I think —David RobertsI loved it back in the 2000s when I wrote about it.Samantha WoodworthI think it makes a lot of sense, because then the asset owners aren't having their generation curtailed and losing money that way. While we're not adversely affecting grid reliability by injecting excess electrons into an overly congested location.David RobertsAnd plus, you just cut the whole NIMBY thing out completely. It's all taking place out in the middle of the ocean where nobody's going to see it.Samantha WoodworthWell, sort of —David RobertsExcept for the big connection spots.Samantha WoodworthYeah, exactly.David RobertsYou're reducing your NIMBY battles to a couple of key central battles.Samantha WoodworthYeah. And I mean, you still have that NIMBYism about where the lines interconnect underneath, or any sort of onshore grid expansion that would be needed to flow the power, which is just super difficult to get approval for any upgrades or new transmission lines, even if they're underground these days. So that's definitely a huge piece that needs to be addressed. And honestly, that's kind of the big piece that I always harp on is the fact that our existing onshore infrastructure needs to get addressed and those projects getting fast tracked. But as far as the mesh grid goes, overall, I think that idea makes a lot of sense.The reason that there hasn't been a ton of movement on it, I don't think is just purely because of cost.David RobertsWe'll talk about planning. I mean, that's like multiple states, the federal government. That's a lot of planning.Samantha WoodworthYeah. And God forbid that everybody talk to each other.David RobertsI know you'd have to have a lot of jurisdictions working together to get that going.Samantha WoodworthYes. So I think that's a big piece of it is like getting everybody together and getting all of the permitting and stuff, getting it done easily. I think also, again, it goes back to that question of "who's going to foot the bill?" Generally, the asset owner is the one that is paying for the lines to connect their project to land or to whatever point of interconnection. So. Okay, well, I only want to pay for the line that connects my project to one point. Who's going to pay for the interconnected interconnection?David RobertsClearly that's something the States would have to get together and somewhat pay for.Samantha WoodworthExactly.David RobertsIt would pay itself back so richly over time.Samantha WoodworthBut it's the time value of the dollar. Right. The dollar later doesn't mean as much as the dollar right now. So the states, they should have a hand in funding pieces of that, probably most of it. But as it stands now, the way that it's always worked for onshore and for solar is just the developer pays for those upgrades.David RobertsWe know how well that's going.Samantha WoodworthYes.David RobertsHow well that system is working.Samantha WoodworthYeah. So there definitely needs to be a paradigm shift, I think, if we're going to get these mesh grids built. I think, again, they are a fantastic idea, but it's just the complexities there and then, yeah, where's the money going to come from?David RobertsJust on the technology side, I mean, you have sort of two buckets here. You have the fixed and the floating. Floating, as you say, is still somewhat in the technology development stage. Is fixed — is there a set technology now or are we still in a place where we might see big, fundamental, new, different kinds of technologies come into play? Or do you think on the fixed side, is that like they know what they're doing now and they're just replicating?Samantha WoodworthThere's multiple different ways that fixed bottom is done and construction methods, let's say. And obviously, which ones get used it depends on the project location and all the characteristics of the seafloor and that sort of thing. I think that we'll continue to see technological developments on the fixed bottom side, but generally, as far as overall design goes, I think we're pretty well established as far as you have these handful of designs to choose from based on your project site characteristics.David RobertsSo we'll get incremental improvements.Samantha WoodworthExactly.David RobertsAnd some scale, some learning from scale, maybe. What about on the floating side? Because I've seen some cool, sort of like, animated demos of exciting, completely new, like the turbines that are sort of laying kind of on their side and then get blown erect by the wind when they need it, and all sorts of crazy stuff on the floating side. Where is that in terms of figuring out what we're doing?Samantha WoodworthIt's definitely more in the technology development phase. I think there's kind of the one overall design that is being kind of used as the baseline for most of these projects, but there are definitely lots of creative designs out there that are being posited. And ultimately, though, I think the one that we are currently seeing as most often used as the rendering is still proving to be what would be the most economical option.David RobertsAnd that's just like some buoys to keep it steady and cables to the seafloor?Samantha WoodworthEssentially, yes.David RobertsAnd this notion of offshore wind turbines sitting out in the middle of the ocean, not connected to any grid, but instead just making hydrogen or making ammonia and serving as kind of like an ammonia gas station for ships, is that anything other than like, a dreamy idea in someone's head? Is anyone seriously doing that?Samantha WoodworthSo there are a couple of projects that are in development in Europe that are going to be directly tied to hydrogen production. So it is not entirely a pipe dream. I know that that's also something they're talking about in Canada, because Canada wants to be a net hydrogen exporter.David RobertsOh, interesting.Samantha WoodworthSo they're proposing a couple of gigawatt scale onshore projects to power those. But then Nova Scotia is also talking about interconnecting offshore projects as part of that, because Canada itself, you know, especially in the east, in the maritimes, doesn't really need any more renewable energy. They have so much hydro power.David RobertsYeah, they need to figure out how to sell it in various forms.Samantha WoodworthRight, exactly. But I could also see them putting in these big offshore projects, using them to power their electrolyzers, but also becoming a net energy exporter to New England. We already buy hydro from them why wouldn't we buy offshore wind?David RobertsOr buy ammonia?Samantha WoodworthOr ammonia. Yeah, exactly. So in other countries, that's definitely materializing. The hydrogen economy in the U.S. is kind of a little bit on the slower side. But I think we could definitely see, especially once state targets have started to be met and there's no longer a push to have these solicitations and have these projects directly tied to the grid, I could definitely see some of these projects contracting for providing power to electrolyzers.David RobertsThat's probably a ways out.Samantha WoodworthYeah, I mean, that's definitely, you figure right now these projects are being proposed to sort of help with the decarbonization goals of all these states. So really I think we're going to just continue to see there be utility contracting and offtake until those goals are either within reach or met, and then we'll start seeing the offtake landscape changing for offshore wind as it is.David RobertsWe still need a lot of clean electricity —Samantha WoodworthExactly.David Roberts— around here. Summing up, I mean, you sort of touched on this, but I guess the big question on most people's mind, and the big question on my mind, the big question on everybody's mind is just sort of which of these troubles that have all converged on this industry at once, which are temporary and which are structural? In other words, how temporary is this versus are we, in some way, to some degree, permanently downgrading our hopes for offshore wind? Or do you think this is all in some sense temporary?Samantha WoodworthI think in some sense this is kind of all temporary. When all of these kind of macroeconomic problems kind of came together, I know that we were talking, "oh, inflation will be back to normal next year." And obviously that wasn't the case. Obviously, I think that volatile piece of it that'll eventually return to normal. But I also think that it kind of has provided us a good lens with which to look at the future for offshore wind development. And knowing that these are things that should be considered as part of the due diligence process.David RobertsLike interest rates particularly — probably going to stay. It's not going to go back down, I don't think, anytime soon.Samantha WoodworthYeah. So in order to adapt to what is kind of our new normal, to use a super cliché phrase, it is definitely requiring our understanding of how our own power markets work kind of be revisited and how getting these projects to fruition, how we revisit that as well. I think in some ways the renewable industry as a whole will be forever changed by all of these issues. But I don't think that it's going to be changed in such a way that is going to be irreversible or overly detrimental to the health of the industries. I think it's just going to force us to adapt, and I think ultimately we're going to be able to.We've seen these growing pains before in all the other technologies. It stinks that those normal growing pains are converging with unexpected exterior stressors. But overall, I think really what it's shown us over and above how susceptible these projects can be to unexpected stressors like inflation or a pandemic, I think it's really shown us to temper our expectations as far as timelines go. I don't personally believe that we're going to see a ton of these projects get canceled. I think we're just going to see a lot of timelines get extended. As far as getting those projects online.David RobertsAre there policy tools? One of the things — it comes up for me again and again, and is it would just be crazy of us to let high interest rates strangle the clean energy transition or substantially slow it down. Are there ways to carve out cheaper money for something like offshore wind? Or just more broadly, are there obvious policy steps that could be taken here to make things somewhat easier on this industry during its time of trouble?Samantha WoodworthThat's kind of a little out of my realm of expertise. I think, though, given the fact that a lot of this is tied to tax credits and essentially government subsidies, it's going to be really hard to sort of disentangle funding from the health of the economy.David RobertsYeah. Okay. Literally, final question, which is just the reason we're talking about all this, is that the potential for offshore wind in the U.S. is big. Just give us, by way of wrapping up, really wrapping up. Just give us some sense of like, what is the prize out there that makes it worth fighting through this tangle to get there?Samantha WoodworthRenewable energy. It really is kind of that light at the end of the tunnel, right. We've seen in the other technologies, we've watched it go from not technologically viable, to technologically viable, to outright economic on its own without subsidies. Offshore wind has the potential to do that as well. And it is on just such a larger scale that it really does have the potential to green our grid in an incredibly huge way.David RobertsYeah. Do we have any numbers on that? I mean, I should have told you beforehand so you could grab some, but when we talk about the potential for offshore wind in the U.S., do we have gigawatt estimations of what's out there?Samantha WoodworthAt the end of the day, we're still expecting close to 15 gigawatts operational by 2030, which is not a small number.David RobertsYeah, and that's all east coast. That's what we expect by 2030. Is all east coast or is there —Samantha WoodworthYep, it's all east coast.David RobertsAnd so is there another 15 waiting for us on the west coast? Like, is the potential on the west coast as big as it is on the east coast?Samantha WoodworthAgain, because of the technology, I think the implementation is going to take a lot longer. But floating farms are generally larger just because the economy of scale is there. So, having successful floating wind on the west coast, it has the potential to be a huge impact on the overall energy transition in the U.S.David RobertsDespite all these troubles, just the hope is pretty amazing. It's just like steady, around the clock, power generated way out where you don't have to see it. That just shows up in your cables. That seems worth fighting for.Samantha WoodworthAbsolutely.David RobertsAll right, well, thank you. I'm sorry I kept you so long. I've been digging into this stuff and it's very interesting.Samantha WoodworthDon't apologize. I could talk about this for another 2 hours.David RobertsSo many moving parts here, like social stuff, political, economic. It's just all in chaos right now. Really fascinating story to watch develop. So, thanks for coming on and walking us through it.Samantha WoodworthNot a problem. Thank you again for having me, David.David RobertsThank you for listening to the Volts podcast. It is ad-free, powered entirely by listeners like you. If you value conversations like this, please consider becoming a paid Volts subscriber at volts.wtf. Yes, that's volts.wtf. So that I can continue doing this work. Thank you so much and I'll see you next time. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Jarra Hicks of the Australian nonprofit Community Power Agency talks about addressing rural resistance to clean energy infrastructure through effective community engagement.(PDF transcript)(Active transcript)Text transcript:David RobertsTo hit its climate targets, the US must build an enormous amount of new clean energy infrastructure. Much of that infrastructure is going to be built in rural communities, and the resistance of those communities to that infrastructure is one of the greatest threats to the clean energy transition.I've done a couple of pods on this subject and will probably do more. Today, we're going to get something of an international perspective. When I was in Australia, I interacted with a broad network of scholars and activists who are thinking seriously about the social mechanics of community buy-in. One of those scholars and activists is Jarra Hicks, who got her PhD at the University of New South Wales with a dissertation on community-owned wind farms in rural (or as they call them in Australia, “regional”) communities. She now runs the Community Power Agency, a nonprofit organization that is working to ensure a “faster and fairer transition to clean energy.”Among other things, Hicks has co-authored a benefit-sharing guide and runs an online benefit-sharing course, both meant to help renewable energy developers better navigate this tricky territory.I've been meaning catch up with Hicks ever since I returned from Australia. Last week I finally got the chance — we talked about the problem of rural resistance, the balance between community engagement and speed, and the many varieties of benefit sharing. I think it will be clear to everyone how this knowledge transfers into the US context. I enjoyed it immensely and hope you do too.All right then. Jarra Hicks, welcome to Volts. Thank you so much for coming.Jarra HicksYeah, thanks for having me.David RobertsThis is a topic of great, great interest in the U.S. right now, but I thought it would be interesting to get a perspective from another country as well, especially since you seem to have devoted your life to learning about this. So I think there are going to be some lessons that are transferable, but let's just start maybe with how you came to this subject of your PhD and of your professional work.Jarra HicksYeah, sure. So I was really lucky. I got the chance to visit a lot of communities that were doing renewable energy projects, and these were communities that were really embracing renewables. They loved renewables and they were getting great outcomes for their communities and for the planet. And I wanted to see more of that. I wanted to see more communities who were really passionate about renewables and able to get a lot of great benefits from being involved in the energy transition. And I wanted to see more communities who felt positive about this change. And if we go back, I first got involved in this in the early two thousands.And at that time, there were a lot of communities who were pushing for more renewable energy uptake. And in Australia at that time, there really wasn't a ton of renewable energy, and probably similar in the states, communities were really wanting to get behind renewable energy as a means of taking action on climate change. And at that time, there was an absence of national policy supporting renewables. So it was about a grassroots movement to get renewables up and running. So we saw programs like communities coming together to organize a bulk purchase and install of solar panels at a community scale.So helping reduce the barriers for people, helping them understand the technology, helping them install it in their homes. But we also saw communities coming together to establish commercial-scale projects like little two-turbine wind farms. And this was really motivated by communities wanting to take positive action on climate change.David RobertsDid that switch at some point to resistance? Because that's the opposite of the problem we have now.Right, well, I guess, yeah. So what we're seeing now is there is emerging resistance to large scale renewable energy projects. And so it is, it's a really different landscape. But what I've learned through my years of being involved is that it's really possible for communities to not only accept renewable energy projects but to really love them and to welcome them in their communities. And it's about the way we go about these projects, and it's about the way we make opportunities for people to really be involved and to genuinely participate in that process.What was the PhD work, what was the specific focus of your PhD?Jarra HicksSo, my PhD looked at small community-owned wind farms. So using commercial-scale turbines, 900-megawatt turbines, 1 MW turbines, but just one or two or three of them at a time. So these are small wind farms that are owned by the community. And those projects, they've emerged from a community desire to have their own energy or to have clean energy to take action on climate change. And these communities went through different processes to set up these enterprises so that they could have community-owned wind farms. And my PhD was really looking at what are the social outcomes that can occur in a community when they go through this process together.And ultimately, what I was looking at is how can we do renewable energy development in a way that brings people along and that helps people to feel positive and confident and comfortable about renewable energy, and that creates a business model that delivers benefit back into communities as well. And through my career now, I've been able to learn about what is it that helps to create a positive relationship between communities and large scale renewable energy projects and to translate some of those learnings into the commercial large scale renewable energy practice of development.David RobertsSocial license, as they call it. Talk a little bit about how you think about social license, just sort of in the abstract. What is social license and why is it particularly so important for renewables?Jarra HicksYeah, so it's a term that's used to describe the ongoing relationship between a project, the project proponent, and the local community or the society hosting that project. It's a dynamic relationship. It's not a once-off license that you might get for other aspects of project approval. It's not a once-off stamp, and there it is. It's dynamic and ongoing. It's constant. It's through the development process, it's through the operation phase of the project. It's lifelong. And it's about creating and maintaining a level of acceptance and approval for a project in the community that is hosting that project.And at its strongest, it's about actually embedding that project into a place so well and so much that people can identify positively with it. Like it can even become a symbol of that place, or it can become a characteristic that people feel proud of. But when it's missing, or if there is no social license to operate, that's when we see broad-scale opposition and protests that can hamstring a project or stall it for years or even sometimes kill a project in the water.David RobertsYeah, I want to spend a little bit of time on that, on the negative side on bad process. Starting with just: Is it as big a problem in Australia as it is in the US right now? Because in the mean, I think I would rank it on top of the forces pushing back against the spread of renewables right now. I would put community opposition rank it number one. There are projects dying right and left of this stuff. Is it that big a problem in Australia? Like, is the Australian renewables community as gripped by this problem as they are over here?Jarra HicksIt's definitely a big concern, and I would say it's becoming a more difficult thing by the day in Australia. Part of what's going on is that communities are getting sick of the relationship with a company that is extractive. They're getting sick of that scenario where a big company comes in and takes something in a way that feels extractive, it doesn't feel fair, and it doesn't provide a benefit, a genuine, lasting benefit in that community. And it doesn't engage with people in a way that helps them to feel like they're being treated with respect. I have a three-year-old kid and if I just try telling him what's going on and being like, "Right, we're leaving the house now. Come on." He doesn't really like it. People don't really like just being told what to do. People respond much more positively if you're like, "Hey, it's going to be important for us to go and do this thing soon. And we could ride the bike there or we could drive the car there. And while we're there, we could do something fun for you as well." taking the example of my three-year-old kid. The renewable energy equivalent is about working with communities through a process that feels fair and good. So it's about doing your engagement well. It's about doing your engagement early enough so that communities genuinely have a role to play in designing a project that is going to be appropriate and well received in that place.It's about doing engagement in a way that allows people genuinely to influence some outcomes of the project. And it's about doing your engagement in a way that is appropriate for that community too. Like, are they online literate or do they rely really on the newspaper and the radio and face-to-face engagement? it's about all those things. But it's also about delivering positive and tangible benefits. So there's really two elements. It's about it being done well in terms of the process and done well in terms of local people's experience of the outcomes from that project. In the academic research on this that's been done across the US, Europe, and Australia, the language is around procedural fairness and distributional justice.David RobertsDo you in Australia, as we do in the US, have an active and well-funded political force pushing against you on this? In other words, trying to sow confusion where you're trying to remove it, trying to raise fears where you're trying to calm them, that kind of thing. Is there something organized like that nationwide, or is this spontaneous community pushback?Jarra HicksThere is both. I would say that there's definitely organized, particularly anti-wind sentiment that has deep links politically within conservative politics and that historically has been proven to have links with the fossil fuel industry as well. And that's been the case for over a decade with regards to the anti-wind movement in Australia. So that is a really difficult political context and they are often really good at doing fear-based campaigning and also capturing the media, and it's a real concern. Part of my way of thinking and strategy for how to address that is if we can be doing our practice well as renewable energy developers, if we can be engaging people well and with respect, we've got good process and we've got good strategies for delivering benefit locally, delivering local jobs and local procurement and other benefits, and we're in those communities having good relationships and good conversations, then that's the only thing really that we can do to inoculate against that fear-based and organized campaigning.David RobertsAnother thing that comes up when I hear this, and I've talked to some renewable energy developers about this and they feel caught in a dilemma, I guess you would say, which is there's this incredible need for speed and this incredible demand for what they want to do from the sort of nation at large, but this incredible pushback at the local level. So when they go fast they run into problems, right? They're told if they go too fast they run into problems. But the only alternative is going very slow. And going slow A, costs more money and B, doesn't serve that interest of speed that's built into the sort of climate targets that the US has.So how do you wrestle with this dilemma between process and speed? When I hear more process, more engagement with the community, especially on a bespoke — as you say, every community is different, and if you really want to do this well, you're going to do research beforehand, you're going to do polls or surveys, you're going to have someone who's there on a full-time basis. I mean I can imagine how to do it very well. All of that to me sounds very slow. How do you think about the relationship of quality, I guess, and speed when it comes to community engagement?Jarra HicksI have a bunch of thoughts on that. I think at a project level, if you have dedicated engagement staff working alongside your project development team and they are able to be on the ground doing the good work in the community, like there every step of the way with your project development team from when that project is first conceived and you're first doing feasibility studies, I don't think this needs to take any more time. In fact, the experience that I have seen with projects in Australia is that it can actually speed up the project development and approval process. So doing good engagement and good benefit sharing.You know, I've spoken to projects whose experience is that it has sped up their approval process and that that's had a really substantial dollar value for them because it's made it easier and faster. And this one particular project I'm thinking of, there had been no wind projects approved in that state for two years because wind energy projects had become quite controversial and political and they got their project approved really without a hitch because they had done great engagement, good benefit sharing, and also because it was a well-placed project, it was a strategically placed project. So I think that good practice does not need to slow you down. I guess the other points that I would make, I think that a lot is to do with the practice of developers on the ground in communities.But the scale and the pace at which we need to do this transition as whole countries and as a whole planet requires that we put some emphasis on creating the right social context for this transition so that our society and our communities really understand why it's needed, they feel comfortable with the technologies, but even more than that, they are enabled and supported to participate themselves. So what I've seen with community energy and what I really believe is that if we have policies that support people to get involved with renewables in their homes, in their businesses, in their communities, that that's going to create a social context of support that will assist us with getting large scale projects happening faster as well.David RobertsI meant to mention as you went past that, that these community engagement people at the renewable energy developers who I talk to also always say that they're underfunded relative to their opposition, that they go in completely unprepared for the scale and intensity of opposition, and that their bosses don't yet understand how important or significant their job is or how the kind of fight they're fighting. Do you have a sense that renewable energy developers are starting to get the significance of this and resource it appropriately?Jarra HicksI do feel like that's a change that's very much underway in Australia, also globally, but there's a long way to go. I think there's a recognition now that social license and the social aspects of this energy change are really important. I think people are starting to use the right words, but I think people are still learning what that means in practice, particularly when it does need to be quite nuanced and locally appropriate in different contexts. But the things that I've seen helping to shift that practice and that sort of emphasis and that resourcing towards more community engagement in Australia, the things that are helping, I think, are industry bodies who are helping people do peer-to-peer learning, and policies that reward better practice.So, for example, in Australia, we have a range of merit-based criteria that companies need to report against in order to be able to access renewable energy incentives or to be able to have grid access to new transmission lines. So that puts like weighting criteria around social outcomes and around community engagement practice, benefit sharing, local procurement, all of those things. Increasingly as well, in the private power purchase agreement market, we're seeing criteria around those social aspects included as well, like say a university who wants to sign a direct power purchase agreement. They want to know that the community has been happy with that project and it's delivering some good social outcomes as well as has good environmental credentials as well.That's also like a market thing that's helping change behavior.David RobertsA little demand pull there.Jarra HicksYeah, so I think those things are helping. One gap that my organization has helped to address as well is like writing a bunch of guides and guidelines, working with policymakers to write those guidelines, doing research to inform those guidelines. But also we have set up a professional development course that is targeted specifically to renewable energy developers and training them up in community engagement and benefit sharing practice.David RobertsYeah, I was going to say, what do you do if you're a developer? I mean, if you got into renewable energy to do renewable energy, this is not necessarily something you understand or have any strength in or — besides the guides are your guides the only guides you're aware of in terms of just like off the shelf help? Because I know a lot of developers are looking for help now, but it's hard to standardize, as you say, it's hard to standardize this stuff.Jarra HicksYeah, well, I think the industry bodies play a role there. So in Australia, it's the Clean Energy Council. They have written guides, we've written guides with them. They've also funded research that's helped us to understand better what type of practice is creating better social outcomes. And that's a piece of research that we did a few years ago. I think it is difficult because the energy industry is dominated by engineers and technical people for sure, but we need to increase the awareness that people with a community development training, community engagement training, even social work, those types of skill sets can be brought in and skilled up enough into the renewable development process that they can help on those social aspects of developing a project.David RobertsSo talk just a little bit about what a good process looks like because it seems like it would be easy, when you're talking about community benefits, it seems how it would be easy for this to look like you're just coming into a community and saying, "if you let us build this, we'll buy you a bridge." Just sort of like very transactional. So what does good community engagement look like? And what are the sorts of things that you can offer a community that don't just look like you're trying to pay them off?Jarra HicksYeah. So the key there is that it needs to be relational. So good engagement is all about forming good relationships locally. That starts with your host landowners, and it broadens out to the neighbors and then the near community and then the broader community around a project site. It's about spending as much time as possible face to face, and even if that needs to be online, but ideally in person, face to face, having direct conversations, having some of those conversations one on one, having some of them in group environments, and building that up over time, sustaining your engagement and offering a range of different ways that people can engage with the project.So, don't just do one focus group. Think about doing a few focus groups in a few different areas. Think about having an online survey. Think about having a stall in the street where people can have casual conversations with you and fill out a physical survey. Think about pairing your online comms with a letter mail out. So one of the keys, I think, is sustaining the comms and engagement over time and through a diversity of methods, but starting that conversation with the community early enough so that the input can inform the project as it develops. Like, I understand a lot of stuff is commercial decisions, but there are going to be things that actually will be useful if you incorporate local knowledge.And those are things like really obvious places in the landscape that are special to people or that have First Nations heritage and significance. If you can access local knowledge early on to know where those are, your project is going to be better off. You're going to avoid the costs of maybe making a mistake in terms of sighting. There's going to be micro sighting decisions that you can include local people in. Like you might reach out to local biodiversity or land care groups to help you understand the nuances of local riparian zones or connectivity among different areas of different vegetation types locally.These are pretty niche local knowledge — things that can really help if you reach out to local groups. And I would say every single point of connection you can make with a local person and a local organization builds up a richer, stronger network of relationships between the project and the community. And that, that gives you more resilience, I think, against the challenges when they emerge. People know who to come to if they're hearing whispers about something that doesn't sound quite right. All of those things help over time. And in terms of benefit sharing, I think the key really is that it's paired with good engagement and that that conversation starts early.So when you're first speaking to the neighbors and you're first speaking to local groups, you're saying, "Hey, we don't know exactly what it's going to look like yet, but we are going to offer a per megawatt amount to a community fund. And the amount we can offer will vary based on the commercial aspects and the generation profile of this project. But where that money goes and how it contributes to the community, we want that to be a decision we make with the community. And so we're going to be setting up a local reference group, we're going to be talking to people, and we're going to be working with you to design that benefit sharing package and then to govern it and make the decisions about where that money goes over time."So, it's really about creating opportunities for people to be involved, to participate. Fundamentally, I think that's it.David RobertsWhat do communities tend to ask for when they are allowed to be involved? Are there patterns? Are there predictable things that work?Jarra HicksA lot of projects end up setting up some kind of grant fund, like an annual grant fund, because it is really flexible and it can be really responsive to whatever it is that the community is wanting to do, or whatever the need is at the time. But I've also seen really great programs like allocating a portion of the benefit fund into a revolving loan program that can support low-income households to install solar panels or solar hot water or heat pumps, and that money is brought back and then recycled over time and can go on to help the next household. I've also seen programs where a portion is allocated to an annual grant fund and a portion is allocated to a sort of longer-term legacy fund where it might go into an interest-earning account for a few years, and then after five or so years, it's got a bigger chunk of money to do a bigger strategic project in the community, and to go out and seek matching funding from state government or whatever it is, so that the community can achieve something that is a bigger, more strategic need, that has a longer-lasting impact. So I think really it's about being able to work with a community to identify what are the things that are going to have a significant impact on the challenges that are being faced by that community, that are unique to that place, that will really help to create a step change.You know, for a lot of small regional communities renewable energy is a really unique opportunity that comes once in multiple generations. And if we can use this opportunity well, we can deliver some really awesome outcomes. And some of the great examples I've seen are renewable energy developers partnering with domestic violence organizations to be able to repurpose worker accommodation into temporary accommodation for people experiencing domestic violence. So after the project has been built, that accommodation is then able to be gifted or co-owned by a local service and a local government to be able to have an ongoing positive benefit in a community.David RobertsAnd these are all just things that developers are coming up with. Communities —Jarra HicksNo, well, in conversation with the community. It takes being on the ground, having conversations, going through a process that is basically like a community development process or a community planning process, thinking about having local conversations with people, thinking about what are the real needs here and what could we do and who could we work with to make a great impact.David RobertsThis also brings me to something that I was glad to see that you are working on and writing about, which is it seems there are going to be places where these projects are concentrated and there's going to be a bunch of projects in particular regions. And it just seems like developers going one by one by one by one by one to each of these little communities and working out bespoke deals — it seems like you could do something more regional, more regional in impact, something a little bit more with a little bit more structure and something that could pool the benefits of multiple projects and maybe do bigger things for public benefit, things that you couldn't do with the revenue from a single project. And you've been writing a little bit about that.So just describe what regional benefit sharing, what that means.Jarra HicksSure. So it's exactly that. It's in areas where there's going to be a high density of projects: How can we coordinate benefits, but how can we also coordinate other things that are going to have a significant impact but also a significant possible positive benefit for communities like coordinating housing, coordinating jobs and training, coordinating employment opportunities and local procurement opportunities? But in terms of the benefits, it's about saying, "yeah, how can we work together?" first of all, to administer our programs so that we don't overwhelm the community and confuse everyone and create engagement fatigue.David RobertsYeah, I mean, you can imagine communities like, "What did you get? Well, what did you get?" And just all the rumors going back and forth. There's just a lot of process happening over and over and over again.Jarra HicksYeah, and totally. And if there's ten different grant funds all in the same area, how do you remember which one are we applying for now? And all the time that goes into those applications? So there's a way of streamlining the administration of the benefit sharing and streamlining the governance as well. So if you've got a local committee involved in helping to make the decisions about what gets funded, being able to have one committee that might oversee a number of different grant programs that are all in the same geographic region, that makes a ton of sense, being able to have some common resourcing of the administration.So rather than having one staff person in every company, you pool that and you do it together. That makes sense. It makes it easier for the community, probably. It also makes it less cost for the company. But then there's also a whole other level is like, how do we pool some of that funding at a regional scale to do something strategic, bigger, with more lasting impact on the real issues? So with benefit sharing, there needs to be layers, right? Benefit sharing is partly about creating a positive relationship and an experience that is of fairness from a project.And so that does need to relate to the community that is most immediately affected by that project. So you need to make sure that your benefits are experienced by the neighbors and by the immediate community who are hosting the project. If it was all going to the region, that probably wouldn't feel fair for the people who are literally the ones who see it every day. So, a portion of the benefit sharing from any project needs to stay in that most immediate community. But I think a portion of the benefit sharing budget, there's an opportunity to pool it with other projects within that region so that you can have that bigger fund and you can do those more strategic projects.David RobertsBut who's doing that? Is that developers coordinating with one another? Because that seems — I don't know how well that's going to work. Is this like a nonprofit entity? Is this a government, a regional governmental thing? How would you structure this so that it feels fair to all the individual communities involved and to all the individual developers involved?Jarra HicksI think that's a great question, and to my knowledge, we're still very much figuring that out the world over. I'm not aware of examples of where this has actually been done yet.David RobertsOh, really?Jarra HicksI am aware of foundations, like existing foundations that are providing some administrative and governance services to developers around their benefit sharing programs. But I'm not aware of anybody who is regionally coordinating a bunch of projects to do something more strategic. And that's the work that we are thinking through right now. And we're basically out there seeking partnerships with other people who want to figure that out with us. But I imagine we're going to see a bunch of different models. And I think this is partly the role of the state. When we talk about needing to coordinate renewable energy development so that we can keep the lights on and meet our climate targets and our net zero emissions targets, there is a role for the state to coordinate that process, and this is part of that coordination that needs to happen.It is not just a technical change. It's also a social process. We need the state. In Australia, this is definitely the case. I can understand why it's happened, but we've been mostly focused on the technical and the market aspects of setting up this renewable energy transition, rather than resourcing and trying to coordinate or putting as much emphasis onto the social aspects. Within that, I include the impacts on housing, the need for additional training and jobs, and workforce development. There are just so many layers to it.David RobertsThis is what I always come back to as I think about these things: I can imagine things developers can do individually and in individual communities, and even some regional sharing if they can figure out models to do it. But I just keep coming back to the role of the state. It would just be so much easier, I mean, if there were a sort of prescribed minimum of here's how much you have to share with the community you're located in, or something like that. Just some baselines, just so people aren't tempted to cheat, because every developer now has to be thinking like, how can I get around this?You need everyone's cooperation to sort of lift the boat. And it would just be easier if there were some force of law behind it, don't you think?Jarra HicksYeah. So there are definitely some really strong guidelines that have emerged in Australia now and some really strong norms that are emerging, and some of that is through state governments issuing guidelines, and some of it is through the merit-based criteria for being able to access transmission lines or access renewable energy incentives. Part of it also is just like industry norms that are emerging and communities also knowing about those and holding developers to account on them. The norms that are emerging in Australia are like a per megawatt contribution that is standard for a wind farm, and per megawatt contribution that's standard for a solar farm.It's emerging now like it was still figuring it out, but emerging in terms of transmission and batteries as well. I think it's great that there's a norm around that dollar figure. It's also great that it isn't regulated, that it has to be spent in certain ways, because I'm a strong believer in the need for that to be a conversation that is led by the local community and needs to be adaptable to the local context.David RobertsHas anybody figured out what I have always thought just instinctively would be the best tool for social license: Which is, once you've been doing this a while and you have some happy communities who have your renewable energy in them and are benefiting from it and are happy that they did it. Why don't you get them to talk to the next community? Do you know what I mean? Like all of this, so much of this, is outsiders coming in. But if I'm in a regional community and someone else from a nearby regional community is talking to me, it seems like you just cut through so many layers of skepticism and doubt with that.Is that a big piece of the puzzle?Jarra HicksI think it totally is. I think people are always more receptive to a message when they hear it from someone that they trust and someone they can relate to. That has been a tactic that's been used in Australia, like taking people on bus trips to go and visit an existing wind or solar farm and talk to the farmer who owns that land, talk to them about their experience of that project. There's also nothing better than actually experiencing something for yourself. If you've heard a bunch of really quite crazy claims about what a wind turbine can do, if you're able just to go and experience it yourself, you can probably make up your own mind about whether or not those things are true or not.But I also think this points to the really important role for advocacy organizations and not-for-profit organizations. Our organization is a not-for-profit that works in this space. And there are a number of other great not-for-profits that work across Australia. It's just important to remember that we need to resource those types of organizations who do help to fill the gaps and who do help to do that kind of positive advocacy. I think there's an onus on philanthropy and governments and developers all to support those kinds of organizations and their role within this ecosystem that is going to help us achieve the transition.David RobertsOne of the things that emerges from reading your discussion papers especially, is if you want to do this right, such that you get both a positive community experience and you get scale and speed: You need a bunch of different groups of people working together who haven't always necessarily including like local governments, nonprofits, developers, maybe whatever. These possible regional organizations are just a lot of different jurisdictions and levels of things to work together. Do you feel like from the 30,000-foot perspective, things are moving in the right direction in Australia? Are people coming together around a model that is actually going to scale and go quickly?Do you feel optimistic about that?Jarra HicksI feel quite mixed about it. I think there's some really great stuff happening and I think there's some good examples of that starting to happen more and more, but there's also some really concerning trends. And part of me feels like it's probably going to get a little bit more messy before we really figure it out. I think that's often the way that change happens, and maybe to some extent that's okay. But I do think I am seeing more collaborations and more partnerships and more conversation between all those different parties trying to figure it out. For me, what I think would really help to unlock the pace and the fairness and the speed of our transition to clean energy is if we really unlock the ability for everybody to play their role in it.In Australia, we've had households keen to get behind solar for a really long time. We've now got 3.3 million solar roofs in our country that account for gigawatts of generation.David RobertsYeah, and that's just an incredible amount of personal experience with solar power too, just at a base level.Jarra HicksYeah, and we've got a bunch of community energy projects as well, and we've got even more that want to get up and running, but there haven't been consistent efforts to enable and support that scale of action. I think one of the big missing pieces for me in this is really thinking about how we can enable small and medium scale projects to tap into the distribution network. We know we need massive transmission upgrades, but they are pretty hard and they take a long time and they're expensive. How can we optimize the distribution network, and how can we support communities to do mid-scale projects in that distribution network as part of our big picture thinking towards this?Because that's going to get more people involved, more people active and understanding more people behind the transition. I heard a story just yesterday of a guy who's a dairy farmer in an area where it's called a renewable energy zone, which is the state government's way of coordinating a high density of large scale projects and planning new transmission lines into a region so that it can accommodate lots of large scale projects. So while the government and industry are planning big transmission lines and big projects and asking that local community to host those projects, this local dairy farmer is still on a really weak part of the distribution network. So much so that he cannot rely on the grid to supply his electricity, to be able to milk his cows.So, he has two diesel generators to be able to meet that need. I think these are the types of discrepancies we need to address because they lead to major community frustration. Instead, we need to be finding ways to enable people to participate. We should not be in a situation where somebody is being asked to host large-scale generation without also themselves being enabled to get involved with the renewable energy transformation.David RobertsYes, well said. Thank you so much for coming on and sharing your experience. And thank you also, I know I mentioned this up at the top, but I'll just mention it again that you and your organization have written a guide to social license for developers and others. Just people to think through how it works and some steps in how to do it well and some best practices and some examples which I think would be great if someone could do that over here too. But I think it would be valuable for everyone to look at it.So thank you for doing that as well. And thank you for taking the time.Jarra HicksYeah, no worries at all. I'll just mention as well that I mentioned that socially responsible renewable energy professional development course that we run. It's an online course and we're in the process of redeveloping it. So, it could be an online, self-paced course that could be accessible for people no matter where they are in the world. So you can go onto our website, sign up for our updates if you're interested in that course. I'm sure a lot of that content would be relevant no matter where you are.David RobertsThank you for listening to the Volts podcast. It is ad-free, powered entirely by listeners like you. If you value conversations like this, please consider becoming a paid Volts subscriber at volts.wtf. Yes, that's volts.wtf. So that I can continue doing this work. Thank you so much and I'll see you next time. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Peter Lehner, head of the food and farming sustainability program at Earthjustice, gives his expert perspective on the upcoming Farm Bill and its potential impact on agricultural decarbonization in the US.(PDF transcript)(Active transcript)Text transcript:David RobertsAs longtime subscribers know — indeed, as the name makes plain — Volts is primarily focused on the energy side the climate fight. I haven't paid much attention to agriculture over the years. I understand that agriculture is a huge piece of the puzzle, both for decarbonization and for sustainability more generally. It's just not really been my jam.However! The Farm Bill — which requires reauthorization every five years — is likely to pass in coming months, and it is arguably the most important climate bill Congress will address this session.To talk me through the agriculture/climate nexus and discuss opportunities in the upcoming Farm Bill, I contacted Peter Lehner. He is the head of Earthjustice’s food and farming sustainability program, and the author of Farming for Our Future: The Science, Law, and Policy of Climate-Neutral Agriculture.We talked about how US agriculture has evaded environmental laws and become the source of 30 percent of US greenhouse gas emissions, ways that the upcoming Farm Bill can be tweaked to better fight climate change, and what's next for agriculture decarbonization.Peter Lehner of Earthjustice, welcome to Volts. Thank you so much for coming on.Peter LehnerGreat to be here, Dave.David RobertsAs you may know, if you have read my work over the years or followed me at all, I'm pretty heavily, deeply into the energy world as the source of most of my time and attention in the climate fight. I know on some level, partially because I've been lectured by people numerous times over the years, that agriculture is a big piece of the puzzle — and land use and oceans, which are other things that I also don't spend much time on. And I fully acknowledge that they're important, they're just not my personal passion. However, I've felt vaguely guilty about that for years.And I know the Farm Bill is coming up, which is a significant marker, I think, possibly the source of some significant action. We'll discuss that in a while. But at the very least a good excuse, I think, for me to check in and just sort of see like, what's the state of climate and agriculture, you know, action stuff, what's going on there? So, that's what you're here for, Peter, because you are the expert author of a book on the subject, numerous podcasts, been studying this for a long time. So before we get into the Farm Bill, just maybe — I know that the subject of the ties between agriculture and climate and carbon and methane greenhouse gases is very complicated.You've written entire books on the subject. But I wonder, for people like me who have had their nose mostly in the energy world, if you could just summarize relatively quickly what are the big kind of buckets where agriculture overlaps with carbon and decarbonization and climate generally? What are the big areas of concern that people should have their eyes on?Peter LehnerSure, you know, I should say, Dave, that I came to this really the same as you. I'd been working on energy issues for a very long time. For three decades, I've sued many power plants. I've worked on many different environmental laws dealing with regulation of the power sector. And what happened is, over time, doing general environmental law for New York State, for NRDC, for Earthjustice where I am now, I kept seeing the impact of agriculture as really being enormous and impeding our ability to achieve our environmental and health goals unless it was addressed. So that's why I'm focusing on this now.But like you, I think most environmentalists focus much more on the industrial sector, the power sector, the transportation sector. And part of what I've come to realize is that we all should pay a lot more attention to the agriculture sector. And we'll talk about the Farm Bill coming up. But really the Farm Bill is the biggest environmental law Congress will address that most people have never heard of. Now why is that? So, I'll tell you quickly. First, agriculture uses most of our land. It uses about two thirds of the contiguous U.S.David RobertsCan I pause you there?Peter LehnerSure.David RobertsThat took me two or three seconds to catch up with that before my mind blew. Two thirds of the land of the contiguous United States is devoted to agriculture?Peter Lehner62%, yeah. And that's about using rounder numbers, about 400 million acres of cropland. About half of that is used to grow food that people eat, and about half of that is growing food that animals eat. And close to 800 million acres of grazing land, some of that is federal land, some of that is state land. A lot of that is private land. But all told, it's over a billion acres of land, almost all in the lower 48 is used for agriculture.David RobertsThat is wild.Peter LehnerSo think about it. If you fly anywhere and look out the window, what do you see? You really see agriculture, whether it be the irrigation circles or just the fields or whatever. That's what has transformed our landscape. And part of the result of that, of course, is agriculture is really the biggest driver of biodiversity loss. So much of biodiversity loss is habitat loss. And look, I've spent decades working on issues like grizzly bears and wolves. But what those issues are at bottom is agriculture because we are grazing in grizzly and wolf territory. And so much of habitat loss, whether it be land or polluted waters, is driving other biodiversity loss.So in addition to that, what I was going to mention is the environmental laws that you're probably familiar with, Clean Air Act, Clean Water Act have actually done a pretty good job of addressing air and water pollution from industrial sources, from the energy sector. But they really have not done a very good job addressing air and water pollution from agriculture, whether it be these hundreds of millions of acres of row crops. Or these hundreds of million acres of grazing. Or these more industrial scale facilities where thousands or tens of thousands or even hundreds of thousands of animals are crammed together into buildings — those are called concentrated animal feeding operations. Those are now the largest source of water pollution in the country.David RobertsDid the laws pass over them or just inadequately address them?Peter LehnerA little bit of both. What happened was in 1972, say, when the Clean Water Act was passed, Congress really wasn't thinking that much about agriculture. But also agriculture has changed tremendously since then. It has become so much more industrial. So that a small number of facilities that are gargantuan produce, for example, almost all of our meat, but those didn't exist in 1970. And as you probably know, in the Clean Water Act, it did a good job dealing with pollution coming out of a pipe. But pollution, say, coming off of city streets, that's called non-point source pollution.The regulation was much less strong, and they relied more on grants and education and sort of nudges, as we say. And much of agriculture — 400 million acres of cropland, 800 million acres of grazing land — that's not, by and large, water pollution coming out of a pipe. So essentially, the Clean Water Act doesn't cover it. And similarly, the Clean Air Act does a great job of addressing stuff coming out of smokestacks. And while there's some, like from these concentrated animal feeding operations, there's very concentrated air pollution coming out of the vents. But out of all of those acres of cropland and grazing land, those are called area sources under the Clean Air Act and are addressed much, much less.But still, air pollution from agriculture, I bet this would surprise most of your readers, kills about 17,000 people a year. It's a major source of air pollution in this country.And that is mostly methane or other criteria pollutants?Methane is actually one of the ways agriculture drives climate change. It's actually other pollutants, largely ammonia and hydrogen sulfide, which come from overfertilization and animal waste. And ammonia is a major precursor to the fine particulate matter that gets into our lungs and causes disease and kills us.David RobertsWhich we're finding out, as I've covered on the pod, is worse. You known, every time a new round of science comes out, we find out it's worse than we thought.Peter LehnerYeah. And in a place like, say, the San Joaquin Valley in central California, which has some of the worst air quality in the country, almost all of that PM, that fine particulate matter, is driven by animal agriculture.David RobertsAnd I'm also going to guess maybe you're going to get to this, but that when you take wild land and make it into agricultural land, the land subsequently captures and holds less carbon.Peter LehnerMuch less carbon. So one of the reasons why I think people don't realize that agriculture drives about as much climate change as our transportation sector is — and think about that for a minute, it drives as much climate change as our transportation sector — and yet most of the time there are conversations about climate change and conversations about agriculture. But until recently, those have been two separate conversations. Say in 2018, when we were working on the Farm Bill then, there was virtually no discussion of climate change in the 2018 Farm Bill.David RobertsI'll admit I don't think of it that way in the mental category in my head when I'm thinking about major sources.Peter LehnerYeah, well, why is that? I think that's because when we think about climate change, most people think about climate change, you think about burning fossil fuels and releasing carbon dioxide.David RobertsRight.Peter LehnerAnd that's climate change for most people. Agriculture's contribution to climate change has some of that. Agriculture uses actually a fair amount of energy for, say, irrigation and tractors and of course, food processing later on down the road. But most of agriculture's contribution to climate change is from other sources.David RobertsRight. Which is to say that even if we clean up energy sources, which everybody is working on, and even if the energy inputs to agriculture, you drive the tractors with whatever, electric tractors or electric irrigators, whatever, even if it's zero carbon energy fueling agriculture, that still leaves most of agriculture's contribution to climate change untouched.Peter LehnerExactly, that's true. And even more frightening, even if we do clean up our energy system and our industrial system to a no carbon situation where we hope to of course, that's where we're putting so much effort into, we will still almost certainly face catastrophic climate change because of the contribution of agriculture alone. In other words, if we do everything else perfectly and we don't change our agriculture system and don't address agriculture's contribution to climate change, we are blowing past 1.5 degrees centigrade, blowing past two degrees.David RobertsSo you think just taking the U.S.: The U.S. can't meet its stated Paris climate targets without reforming agriculture?Peter LehnerThat's basically correct. So let me explain a minute why this is the case. Agriculture's contribution to climate change: First, think about methane, which you've mentioned most people think about methane, oil and gas, right?David RobertsYeah.Peter LehnerActually, cows and animal agriculture emit more methane in the U.S. and around the world than the oil and gas sector. Most of that methane is called enteric methane. It's essentially belching and exhaling of cows. And their stomachs are different than ours. That's why they can eat grass in a way that you and I can't. But every time they breathe out, they're breathing out a lot of methane. So that is an enormous source of methane, which I'm sure your listeners know is more than 80 times more potent a greenhouse gas than carbon dioxide over 20 years.David RobertsNobody thought they're innovating a better cow, are they? That seems like fewer cows is the only solution to that. I mean, maybe we're going to touch on solutions later so maybe we should save this. But just like that doesn't seem like a technologically solvable problem. You just need fewer cows.Peter LehnerMost studies have shown that fewer cows, and therefore the consequent part of that is shifting diets to less beef-heavy is one of the fastest, most effective and cost-effective climate strategies and really has to be a part of any strategy. There are things you can do. Breeding has reduced the methane emissions per pound of beef. The way you raise the cows can make a difference. The way you graze them can make a difference. How long they live before they're slaughtered can make a difference. There is some research into feed additives that you'd feed cows, and that changes the bacteria in their gut to produce a little less methane.David RobertsOh, interesting.Peter LehnerAnd all of these are important. There's not one solution. But I think what is unfortunate is sometimes it's viewed by industry as only a technical solution. And the reality is it has to be both technical and essentially demand side. So, the other way methane is produced is manure. There's all those animals. We've got about 50 times more waste produced by animals than by humans in the United States.David Roberts50 times more?Peter LehnerYeah. Those animals produce a lot of waste. One dairy cow, for example, can produce about as much waste as 200 people.David RobertsJesus Christ.Peter LehnerSo all that waste, most of it sits in lagoons or essentially is handled in such a way that it creates a lot of methane. So that's another way that methane is produced and agriculture contributes to climate change.David RobertsWhen people talk about lagoons, I just want to clarify here, they just take all the manure and slough it into a giant pond of manure where it then sits. Is that what people are talking about when they talk about lagoons? There's not any fancy technical. It's just a big pool full of crap.Peter LehnerThat's basically correct. And that's the dominant way in both pig farms and dairy farms, we handle our waste. To get technical, when you put the manure into a big pit like this, because it's wet, there's water, it's transported by water, it is anaerobic. That means it doesn't have oxygen. So as it decomposes, it releases methane. And that is a really significant source of methane all around the country and contributes both locally, but also obviously, majorly to climate change. And I should say rice, also, rice production, also, if you think about it again, you have the image of a rice patty, it's flooded. So you have organic matter decomposing in an anaerobic, without oxygen, system releasing methane. But by far, most methane is from cow belching.David RobertsThat's the big source.Peter LehnerYes.David RobertsBigger than manure.Peter LehnerBigger than manure. Although manure is also very big, I don't want to minimize that. And the two together, again, are more than the oil and gas sector.David RobertsThat is wild. There's so much attention going to oil and gas methane right now, EPA rules coming, there's international treaties being signed, like on and on.Peter LehnerYep. And there should be. We obviously need to address those sources of methane. I think that what is often forgotten is we also have to address these other sources of methane. So the other reason it gets confusing is the other two ways agriculture contributes to climate change are also very different than burning fossil fuels. The second is that almost all of that cropland uses a lot of fertilizer. By and large, in the U.S. and around the world, people put on a lot more fertilizer than the plants take up, and a lot of nitrogen is added to the ground that is not absorbed by the plant.So where does that nitrogen go? Some of it runs off into the water, and then it causes eutrophication, algae outbreaks. It causes the dead zone in the Gulf of Mexico. It seeps into groundwater: You have heard of blue baby syndrome, which is too much nitrate in the groundwater. But some of it also goes into the air. And some of it goes into the air as NOx, which is sort of a local smog causing pollution. And some of it goes into the air as nitrous oxide. N2O nitrous oxide, which is about 300 times more potent than carbon dioxide as a greenhouse gas and also one of the major drivers of ozone depletion, stratospheric ozone depletion.So this is a major source of climate change, nitrous oxide pollution alone, virtually all of which comes from agriculture, virtually all of which is this overfertilization and some coming from these manure pits that we talked about before. That alone is about 5% or six percent of U.S. greenhouse gases.David RobertsOh, wow.Peter LehnerSo again, it's not burning fossil fuels, but a major contribution to climate change. And then the last way agriculture contributes to climate change is what you alluded to earlier. When you convert land, say, native grasslands or forest in Brazil or forest in the U.S. to cropland, you take this carbon that is in those healthy soils or in the grass or in the trees, and you release it, and that goes into the atmosphere as carbon dioxide. So you get two things: One is you get this slug of carbon dioxide into the atmosphere when you convert land, this conversion of land from grassland to forest.But then the second part, which EPA is only beginning to really pay attention to, is what you can think of as the lost sequestration capacity. Healthy land, grassland, forest, land is this very dynamic, wonderful system that is sequestering carbon and storing carbon. And by contrast, cropland is really — the way we treat it often is largely biologically dead. It has very little carbon life in it. And that's why we have to put so many fertilizers in it.David RobertsIs that just because of monocrops? Is that just an inevitable result of monocrops?Peter LehnerI'm not sure it's absolutely inevitable. It's in large part because of the way we grow in these sort of chemical dependent monocultures, for sure. So you have both this slug of carbon when you convert land. But, hey, look, a lot of our cropland in the U.S. was converted 100 years ago. Every year, that is not sequestering nearly as much as it could. So you were losing the sequestration capacity. That 800 million acres of grazing land — think about that, it's about 40% of the contiguous U.S. And it has been overgrazed for decades. There are reports of John Wesley Powell going out west and saying, "Whoa!"He was sent out to look after exploring some more remote areas. But everywhere he saw cattle, he said the land is getting degraded. In 1934, Congress tried to address overgrazing and erosion and soil degradation. And then 1976, they tried to do it again, so far, really not to much avail, with the result that you have hundreds of millions of acres that aren't sequestering the carbon they could.David RobertsYeah, this came up in our Biofuels discussion a few weeks ago, too. A lot of new thinking about biofuels is taking that sort of counterfactual sequestration into account.Peter LehnerExactly. And you did a great podcast with my colleague Dan Lashof, and we're working together on biofuels. That was a great podcast you did there. So if you add all of this up, what you see is that agriculture has this enormous contribution to climate change, but it's so different than the way most people think about climate change. And what happens also is EPA sort of thinks about it differently. So, first of all, their classic greenhouse gas inventory puts, say, on farm energy in a different category. They don't put that in agriculture. They put that in energy, or they put that in the manufacturer fertilizer, which itself is enormously energy intensive and releases a lot of CO2.That's in a different chapter. Land use conversion, that carbon that I was telling you about, they put that in a different chapter, and they don't even think about, in their greenhouse gas inventory about the lost sequestration capacity, this opportunity cost. So if you just look at the inventory, EPA says that agriculture contributes about 11% of U.S. greenhouse gases. But if you actually think of agriculture as a sector all, what really goes into agriculture, and you include the land use impacts, which, as I said, are usually left out, that's where you get that agriculture is basically in a par with transportation and is about a quarter drives about a quarter of climate change.And then, if you include the rest of the food system, the processing, et cetera.David RobertsFood waste.Peter LehnerAnd food waste, of course, rotting in landfills, you've got about a third or more of climate change is driven by our food system. And that's why unless we change our food system, we're not going to address climate change adequately.David RobertsWild, okay. I want to get to the Farm Bill, but one final question, which is just my — and again, this is sort of my impression from the outside over the year — is that the agriculture industry has a level of power and influence in political circles that I think most people don't appreciate. That sort of makes the oil and gas sector look like patty cakes. It's amazing. I will never forget that Oprah — I don't know if other listeners are old enough to remember this — but Oprah said on her show once, basically, "You know, beef's bad, it's not very healthy and it destroys the environment."And got taken to task by the agriculture industry and they basically took her down and forced her to publicly apologize. And if you can take Oprah down, you've got muscle.Peter LehnerYeah. And it is certainly true. There's no question that the conventional or industrial agriculture lobby is very powerful in Congress. I would point out that there's a lot of great farmers who are trying to do things right and are working to produce food, healthy food, in a sustainable way. And we work with groups like the National Sustainable Agriculture Coalition, which is itself a coalition of a lot of these groups, I wish they had the political power that conventional AG does because they do great stuff and they are really examples of what we want to be doing, how we can produce food in a way that doesn't pollute our air and water and that rebuilds soil health.But unfortunately, the political power is with the agrochemical industries, which are very dominant. They say the meat processing companies, four companies control 85% of the beef market. These are enormously politically powerful.David RobertsSo the Farm Bill then, before we get into the details of what the Farm Bill might do or what you want it to do, let's just talk about the Farm Bill as such. This is something that they pass every year or a set number of years because it just like comes up periodically. Is this something they have to do every session?Peter LehnerNo. So, the Farm Bill is so important, and for a long time, really, when it comes up, it's really only the farm community that pays attention to it. And I think what I hope you've heard is that everybody should pay attention to it. And that's why the Farm Bill is far more important than people realize. For all of us who eat, for all of us who breathe, for all of us who drink, the Farm Bill has an enormous impact. So what is the Farm Bill? The Farm Bill was first passed actually in the Depression in 1933. There was the Depression and hunger.There was the Dust Bowl, there was the crisis on farms. And so Congress stepped in. And I can give you a long history and I won't. But basically Congress did two things. One, they tried to address the hunger and they also tried to restrict supply, pay farmers not to produce, to keep prices high. And sometimes also buy some surplus to give that to the hungry also, but as a way of keeping the surplus off the market and keeping prices high.David RobertsThat's why the Farm Bill has this weird structure where it has food subsidies for the poor in it, which I think, on the surface, seems like just an odd artifact.Peter LehnerYeah. And it's also essentially a political marriage. So, the Farm Bill, on one hand, provides nutrition assistance, now called SNAP, Supplemental Nutrition Assistance, formerly Food SNAP, that helps feed about 45 million Americans every year, and that right now provides about $75-80 billion a year. It also then provides about $20 billion a year in farm subsidies. And ever since it was passed in 1933, it was amended a few times. But basically, it has to get reenacted, reauthorized every five years. And if it doesn't, these programs on which so many people depend basically stop. They won't continue without being reauthorized.So the last Farm Bill that was fully enacted was in 2018, and so it expired September 30, 2023. There was still a little extra money hanging around, so we had a couple of months. But then what Congress just did a couple of weeks ago in the continuing resolution that funded the government up to January 19, they also agreed to extend the Farm Bill until September 30, 2024.David RobertsSuch a rational —Peter LehnerYeah, exactly. We're covered right now. But it ends up being enormously important because it provides this nutrition assistance for, as I said, 45 million Americans. Really important. And it also has a series of different programs that provide enormous subsidies to farmers. And those subsidies, when you put them together, have an enormous impact on what is grown, where it's grown, how it's grown, and all of that for the reasons I was just explaining about how agriculture affects our environment, and climate change has an enormous impact on the environment. And that's why the Farm Bill is actually the most important environmental law Congress is going to address in the next couple of years.And unlike our other environmental laws that haven't been amended for decades, this one is amended every five years.David RobertsI'm so interested in the SNAP thing. I mean, it's a big safety net program, correct? That's been around since 1933, I am assuming, in fact, I know to be the case that conservatives hate social safety programs generally, and I bet they hate SNAP. So what is the magic sauce that has allowed this extremely large subsidy for poor people to survive what I can only assume are repeated conservative attempts to weaken or get rid of it? Is there some reason it has stayed in? How has it survived, I guess, is what I'm asking.Peter LehnerLook, I'm not the super political expert here, but what people have said who know this and have worked with this is, you essentially have a marriage. You have the Democrats that support the Nutrition Assistance Program, and by and large, Republicans support the farmer subsidies and neither has enough support to get either of those through separately. And in some ways there's something good there, which is that the Farm Bill has always been pretty bipartisan. And for example, right now Senator Stabenow, who is the Democratic Chair of the Senate AG Committee, and Senator Boozman who's the Republican ranking member of the Senate AG Committee, are really trying to work together because history is that this Farm Bill doesn't get passed unless it's bipartisan.David RobertsDefinitionally it will have to be this time, right?Peter LehnerExactly.David RobertsIt's going to have to go through a Republican House and a Democratic Senate. I mean, is it viewed is it widely accepted as sort of must pass, like they are going to figure something out or is there any chance at all that it could just lapse?Peter LehnerI don't think there's really any chance it would just lapse because that would largely end these programs on which so many Americans, both the Americans who need it for food — and by the way, it's often thought of as though those are urban Americans and rural Americans are the farmers. That's not the case. There are people all around the country and in many places rural communities at even higher rates that depend on SNAP assistance, on food assistance. So this is really important to everybody. And of course producing food is important. So the farm safety net is important.What could happen is, I suppose, even though I think both the House and the Senate agriculture leaders are saying they're going to work very hard to get a new Farm Bill out in the spring of 2024, if that doesn't happen, potentially they could just extend it for another year the way they just did.David RobertsThat does seem like the way we do things.Peter LehnerRight. It's not ideal, but I don't think, and people who know this area better than I do, I don't think the chances of the law just ending completely is really in the cards.David RobertsSo they're going to figure something out, so they're going to pass something. So this is a chance to get some good things through.Peter LehnerRight. And there's some good things in. And I should say one of the important elements here is the Inflation Reduction Act. And you've probably talked about that a lot and mostly focused on the many billions of dollars that went to clean energy programs. But the Inflation Reduction Act also put $20 billion into essentially Farm Bill programs, preexisting Farm Bill programs, which pay farmers to implement conservation measures. And those have always been oversubscribed, which means more farmers apply for this assistance than can get it. So the Inflation Reduction Act put an extra close to $20 billion over four years into these conservation programs, but with a twist, which we think is terrific.Most of these conservation programs are for a wide range of resource concerns: water quality, air quality, habitat, and others. In the Inflation Reduction Act these have to be conservation practices focused on reducing net greenhouse gases.David RobertsInteresting.Peter LehnerSo this was the first time — in the Inflation Reduction Act — that Congress really, in any way, really linked agriculture and climate change and said, "Here's $20 extra billion, but you got to spend it on climate change."David RobertsRight. So AG did not get completely overlooked then, in this last session, in this last round, because yeah, I hadn't really paid attention to that. I had kind of thought it was like the redheaded stepchild that got passed over. So there is $20 billion is not pocket change either.Peter LehnerNo, it's a lot of money. As I said, right now, the core Farm Bill gives farmers about $20 billion in subsidies every year. But most of those subsidies are not for conservation programs. A lot of that is for what are called either commodity support, where essentially a farmer gets paid, based on what he grew in the past, if the market price or his revenue goes below a certain price. So it's essentially a price guarantee called the reference price.David RobertsIt's an extremely Soviet sector of our economy.Peter LehnerYeah. And it's largely almost three-quarters of that goes to corn and soybean, which of course, is largely used either for animal feed or for ethanol. And then we also have crop insurance, which, again, that makes a lot of sense. We all want to eat. We need food security, there should be crop insurance. In this case, the premiums are very heavily subsidized by the taxpayer. Over 60% subsidized. And again, over about three-quarters of crop insurance went to corn, soy, wheat and cotton, those four big crops. And what happens, the environmental impact of that is it encourages farmers to essentially plant in riskier areas, which tend to be the more ecologically sensitive areas, because if it works out, they get all the benefit, and if it doesn't work out, the taxpayer funded crop insurance pays them off.David RobertsLittle moral hazard there.Peter LehnerRight, exactly. And then the last bit is these conservation programs, which got this big boost in the Inflation Reduction Act.David RobertsIs there any reason to think that that 20 billion is threatened in some way, or is that pretty secure? Is that part of the Farm Bill fight those subsidies?Peter LehnerYou nailed it. Absolutely. Much of what we've been hearing are ideas of how to essentially — we think of it as a raid on that money, that $20 billion. And some would say, well, let's put it to a broader range of conservation issues like irrigation or something, and others would say keep it within agriculture, but instead let's use it to sort of lift, say, the price guarantee that peanut farmers get. And we have been pushing very hard to try to keep this money and keep it climate focused. And fortunately, Senator Stabenow, who, as I said, is the chair of the Senate AG Committee, has been very, very firm.She has repeatedly said that it's not going to happen that we're going to lose this. Because this is really an extraordinary investment. It's big boost in conservation funding and the fact that it is climate focused is really important because this is where there has not been enough attention over the past and where there's really great opportunities. I think it's important just to pause for a moment and just remind there's a lot of things farmers can do, and some farmers are already doing, that can make a big difference in how much nitrous oxide you release, how much methane you release, how much carbon is stored in your soil. And the trouble is most of those practices are only used on about 2% or 3% of American farmland.So we know what we want to do and this is a way to really accelerate the adoption of those practices.David RobertsSo would you say that's the biggest priority here, the biggest fight, the biggest priority for the Farm Bill is preserving that money for its intended purpose?Peter LehnerYes, with a slight caveat. One is we definitely want to save the Inflation Reduction Act money, but the Farm Bill money is separate. The Inflation Reduction Act directed additional money into Farm Bill programs. But the Farm Bill itself provides money. And so we're going to want to be sure that we continue what's called the baseline amount of funding for the conservation programs in the Farm Bill and ideally make sure that those are better targeted, also more closely targeted to climate issues. And actually the federal government itself, the U.S. Department of Agriculture's Natural Resource Conservation Service has studied these practices that they're funding and they themselves have found that some of them are actually counterproductive.Needless to say, we'd like to say let's not have the taxpayer subsidize practices that the government itself recognizes are counterproductive. Let's focus on the best practices, the ones that have the best climate and environmental impact. And since there's a lot of farmer interest in these, let's really put our money where it can make the biggest difference.David RobertsYeah. So fights over the money and you mentioned also in your blogs on this subject, speaking of research, that AG research in general is undercooked, underfunded. Is there a chance to get more of that in the Farm Bill?Peter LehnerWe are certainly hoping. And again, there's two or three elements of that under President Obama, he started these climate hubs which were really areas to focus on climate aspects of agriculture. There's been a lot of research but most of it has been on productivity and what you can think of as just classic conventional agriculture chemicals. So one is to get more research. Unfortunately, publicly funded research has dropped in the U.S. And when that gets its place taken by private funded research; it's not on things like climate change, it's on things like seeds that you can sell.And then the other is that that research — so, we need more, we need it to be better focused on sustainable practices rather than on unsustainable practices. And we need it to be essentially guaranteed because research is a long-term process. If you just do it for a couple of years, you may not, especially in agriculture, things take time. And so, we need a long-term commitment to these climate hubs and to research and sustainable agriculture. There was a study done by, I think it was UC Davis — I'm not sure — that every dollar in agricultural research has over $20 in payback.It's one of the most cost-effective ways we can spend research dollars. So that's a real opportunity for us.David RobertsAnd you also mentioned the crop insurance program, which I think most — even if you just explain that to a person on the street, the opportunities for that to encourage bad behavior seem quite obvious from the structure of the thing. Are substantial reforms to that on the table at all, or is that a subject of discussion?Peter LehnerI think it's a subject of some discussion and a lot of people in different ways want to make sure we get the best benefit. They recognize we do want crop insurance because it's important to recognize crops are sort of different. Most insurance is sort of trying to pool risk. So if my house burns down, I get covered. But if my house burns down, it probably doesn't mean your house is burning down. But with crops, if I have a bad crop, chances are my neighbor does too. That's why I think some amount of government involvement in crop insurance makes sense.You really have to sort of spread the risk around. And of course, food security is really important for our country. So we want to keep crop insurance, but we also want to do it to incentivize behavior that minimizes risk. And in particular, as climate change is affecting farmers more and more with droughts and floods and changing weather patterns and increased pests, we'd like to ensure that our crop insurance system is encouraging farmers to use practices that minimize risk. Unfortunately, right now a lot of the practices that farmers use actually enhance risk. They make them more vulnerable to floods and droughts.And the good news here is that many of the same practices that the Inflation Reduction Act will be funding that will help mitigate or curb climate change will also help farmers adapt or prepare for climate change or better respond and manage climate change. The same ones that mitigate can help build resilience. And that's a real opportunity.David RobertsAnd what about the Rural Energy for America program, REAP as it's called? This came up when I raised the subject on Twitter. This came up a couple of times. Is that on your radar?Peter LehnerIt is not as much. So, I'm not an expert. But there again, there was money in the Inflation Reduction Act to help convert some of the rural energies, which I remember from my time working on energy are some of the dirtiest parts of the power sector and there's great opportunity in rural communities. One thing they have is a lot of land. And so it's a great opportunity to shift from, say, an old dirty coal plant to solar and wind. And I think that's what the Inflation Reduction Act funding will help accelerate.David RobertsAnd the final thing you mentioned in your blogs was transparency. This is another thing where on the energy side I've been following, there's a lot of talk about this, a lot of talk about like California just passed a law that forces large industrial users to report their scope 1, 2 and 3 emissions. So there's a lot of work on transparency on the energy side, I'm guessing giant AG corporations are not super transparent. What can be done on that front?Peter LehnerWell, we need to keep pushing that. That is a real problem. And I think it's a problem both in the specifics that there's very little transparency and it's not over agriculture's contribution to climate change, but agriculture's conventional air pollution. I mentioned earlier that say these concentrated animal feeding operations are the country's largest sources of hydrogen sulfide and ammonia, which are poisonous gases. And EPA for a long time exempted them from reporting under the federal statutes. And we actually sued EPA and said that exemption was illegal and the court agreed with us. And then the industry was powerful enough during the Trump administration to get Congress to amend the environmental laws —David RobertsHoly crap.Peter Lehnerto exempt them from — and again, this is just reporting their poisonous emissions.David RobertsIs there any plausible cover story for that or is that just a pure power play like we don't want to?Peter LehnerIt's hard not to see it as a power play because of course, reporting is, I think, by industry seen as the first step to potential oversight or regulation.David RobertsHeaven forbid.Peter LehnerWe were talking earlier how nobody really understands how much agriculture contributes to climate change. And of course, if they don't understand that, there's going to be no pressure politically to address that contribution. And unfortunately, right now, agriculture doesn't have to report their greenhouse gas emissions. There's been a rider in Congress for almost a decade prohibiting EPA from making industrial agriculture report its greenhouse gas emissions. And there's already proposals in Congress that if the SEC rule requiring reporting ever comes out to try to exempt agriculture from that, there has been pushback in almost every way of having agriculture to report their emissions.And the sad reality is these emissions are real. They're either causing climate change or they're causing local air pollution or both. And not reporting them doesn't mean they don't cause climate change. It just means we're not going to address them as effectively. So it's really important that people begin to understand that this is a sector that has tremendous impact and we've got to be much more open about it so that we can address it in a way that makes sense. And look, we all eat: We need to have a food sector. Nobody is saying that we should get rid of the food sector in any way.Agriculture is super important, not only to the country overall, but to every state. But we also know enough today to be able to produce healthier food in a much more sustainable way.David RobertsYeah, you've laid out some specific stuff that sort of climate aware people are pursuing here. Preserving the IRA money for conservation programs, beefing up those conservation programs, aiming those conservation programs more at climate change, beefing up research, reforming the federal crop insurance program, increasing transparency. Give me a sort of realpolitik assessment. How should we think about the chances of these good things happening? Unlike on the energy side, where nothing passing at all was always an extremely real and looming possibility here, something's got to pass. Right? So what do you think are the chances of this good stuff getting in there?Like what's? Sort of the balance of political forces? And I'm thinking specifically about the House, the Republican House, which is, as you might have heard, insane and incompetent.Peter LehnerSo I think breaking it into two pieces: Senator Stabenow is so strong on protecting the climate focused conservation funding of the Inflation Reduction Act that I would like to feel that we can think that that will remain. And that's really important. And that, of course, is going to be helping. I think it's important to remember this is money that then goes to hundreds of thousands of farmers who want to spend the money in good ways.David RobertsThis is not against farmers. None of this is against farmers.Peter LehnerNot at all. More farmers have applied for these programs than could get it. Two out of three farmers in the past have been turned away because we didn't have enough money. So this is money that is going right to farmers doing exactly what they want and what we as a country want. So that's really great. I think 2018 may be a bit of a lesson for us. In 2018, the House of Representatives passed a Farm Bill with one party. The Republicans passed a very extreme Farm Bill, unlike any before. It had always been bipartisan in both houses.And then the Senate sort of ignored that and passed a bipartisan bill that was really much, much better. And then the House came around and adopted the Senate bill. So I hope something like that may happen again. I think the Senate is going to be working hard to come up with a bipartisan bill that will make some climate improvements along the way. There's also, I should say, a long history of discrimination and of unequal access to Farm Bill programs for farmers of color. And this administration is doing a lot to try to address that, to really make sure the money is getting to farmers that have been underserved in the past.And I think we will see some improvements on that score in the Senate Farm Bill. And my guess is that although there may be some noise at the House beforehand, one can be hopeful that at the end of the day, the House will go in the direction of a more reasonable bill from the Senate.David RobertsYeah, it seems like clowning around and embarrassing themselves for a while and then just sheepishly doing what they should have done all along seems to be the pattern they've set so far. So maybe that'll happen again.Peter LehnerYeah, that happened in 2018.David RobertsYes, I know. It's like the House Republican special. I hate to be in a position where I'm depending on the U.S. Senate for anything good in life, but here we are. So a lot of this seems like I don't want to say small ball, but let's say there's nothing fundamental here on the table in the Farm Bill. We're nibbling around the edges, beefing up existing programs, tweaking existing programs. So I want you to imagine — free yourself from the fetters of politics for a while — imagine some bright future day when Democrats have another trifecta and they have, for whatever reason, power to do big things, another big swing at climate, because there are a lot, I think everybody sort of acknowledges, IRA was a big deal, but there are definitely pieces of the puzzle that IRA did not get to.And so say there's Democratic majorities and Democratic will to do big things on climate in the next Farm Bill. Think big for me here, just for a few minutes. What kind of things would you like to see that would be more transformative?Peter LehnerWell, I would focus on two. One, I mentioned earlier we would have a crop insurance program that really benefits crop risk reducing behavior, which also is climate change mitigating behavior. And so instead of just having the conservation programs encouraging behavior or practices on farms that we want to encourage, you have the much bigger and much more important crop insurance program doing that.David RobertsAnd that's stuff like just rotating crops and —Peter LehnerRotating crops, cover crops, adding trees to pasture land and to crops. Having a diversity. Part of the way you can be more resilient is having a diversity of crops if you have nothing but one crop, if there's any problem there, you're in big trouble. And diversity is both biologically much more stable, but it's also economically a lot more stable.David RobertsAnd we should note and this is, I guess, implied and obvious, but I'm just going to say it explicitly anyway if farmers were not completely insured against the risks of giant monocropping, they would naturally be moving towards more variety just to protect themselves, right? It's only because they are protected entirely by this crop insurance program that they're not buffering themselves more against risk in this way.Peter LehnerThat's certainly what you're seeing, that the farmers that are using more sustainable approaches tend to be growing a much wider range of crops and products. So they have that economic as well as biological diversity. But the other big thing that would be great to change right now, the Farm Bill directly and indirectly, very heavily supports animal agriculture. And for the reasons that I mentioned, that is where most of the climate change contribution from agriculture comes from. It's the animal manure, it's the cows belching, it is the production of animal feed. And it's animal feed is very inefficient.It takes about 15 pounds of grain to get a pound of beef. And corn is the most heavily fertilized with nitrogen fertilizer crop. And all of that nitrogen fertilizer, as I mentioned, not all of it, but a lot of it is running off as nitrous oxide. So all of this animal agriculture, which also uses up that 800 million acres of grazing land and therefore losing carbon, has this huge climate impact. It also, frankly, is unhealthy. It also isn't great for biodiversity.David RobertsYeah, I mean, beef is bad. People hate to hear this and no one wants to say it publicly, but beef is bad down the line. Pick your lens: health, you know, ecology, economics, concentration of wealth. I mean, name it.Peter LehnerWRI has some great charts. They're a great organization that compares the climate, water and land use footprint of different foods. And you will see that beef is just far more than any other food that we have. So right now, the Farm Bill really heavily supports that and provides almost no support to plant-based alternatives to a healthier diet. And if you think of what we've done in the energy system, we tried to clean up coal plants, we tried to switch to inherently clean energy like solar and wind, and we tried to reduce demand by energy efficiency.Right now, most of what we talk about in agriculture is just that first one, just trying to clean up existing production. We have to think about both shifting to inherently cleaner way of getting food and that is, for example, a plant-based diet or plant-based alternatives. And it doesn't have to be going vegan. This is just Americans eat many times more meat than any other culture. We could still have plenty of meat and eat much less than we are now, with much less of an impact. And the Farm Bill can make a big difference there.People love to think that this is all cultural, but it's also economic. Right now, meat is cheap because taxpayers pay for a lot of the bill. And that can be balanced in a Farm Bill where taxpayer subsidies, the subsidies in the farm Bill are supporting a healthier, more climate friendly food system rather than a food system that is so focused on these products that have a very big climate impact.David RobertsYeah, I hate that cultural argument. I just have to say you see that in transportation too. You have decades of public policy supporting automobile infrastructure such that average people just living normal lives have to drive all the time. And then you get a bunch of people saying, "oh, it's just cultural, Americans just like their cars." That's not really it. And I think it's really the same with beef. This whole idea that Americans just have some sort of inherent love of big steaks, big meat, it's so ridiculous. I always find that absurd, although that is a real third rail.Peter LehnerYeah, that's where economics makes a difference. And right now, as I said, we're subsidizing foods that tend to have a larger environmental impact and frankly, are less healthy, and we could and should be subsidizing food that is healthier. For example, good old fruits and vegetables get comparatively much, much less support in the Farm Bill.David RobertsYeah, that's crazy. When do you think, and this will really be the final question, but when I think about all the kind of cultural hot button issues that are involved in climate change and decarbonization, I mean, there are millions. Like, we just went through this gas stove nonsense last year. But no hot button issue is hotter of a button for some reason than diets and meat. Meat in diets is just like — we're talking about Oprah — just like you can't go there. So when do you think we'll reach a point where a mainstream politician will actually broach the subject, "hey, we should encourage Americans to eat less meat" and just say it outright?Is that ever going to happen?Peter LehnerWell, Cory Booker is already saying that to some extent, and he's very aware of this impact. Part of the reason it gets so derailed is people tend to view it as an all or nothing. And we make food choices three times a day. There are a lot of chances to just slightly shift to a diet with more fruits and vegetables. And it doesn't have to mean you're going 100% vegan and just in the same way that we can shift our transportation system — and maybe you drive a little less and you take mass transit a little more — it doesn't mean you will never, ever get into a car again.So I think the conversation about diets has been, unfortunately, torqued, and actually it makes even less sense. You will only buy a car maybe once every ten years, but, as I said, you make dietary choices three times a day, and you also have the health benefits of eating more fruits and vegetables. So it's a great opportunity. But again, I think it's important in terms of what policy can do is partly it's what foods say, for example, the federal government itself buys. But it's also in the farm Bill, which is so important to every environmental matter that we care about.It can also be supporting healthier foods and more so than it does today. That way you'd have a farm Bill that is encouraging farmers to grow different foods in places with less environmental impact in a way that is more sustainable. And that's, again, it's why this Farm Bill, most people don't think about, has this environmental impact far in excess of virtually anything else that Congress will be addressing.David RobertsAwesome. Well, Peter, thanks so much for coming on. I've been meaning to do this for ages, and it sounds like this was the right time to do it. So thank you so much for clarifying this whole subject matter for me more. As you could tell, I wandered into it more or less ignorant. So this has been absolutely fascinating. Thank you for taking the time.Peter LehnerThank you for your interest. It's great to spread the word on this; it's so important.David RobertsThank you for listening to the Volts podcast. It is ad-free, powered entirely by listeners like you. If you value conversations like this, please consider becoming a paid Volts subscriber at volts.wtf. Yes, that's volts.wtf. So that I can continue doing this work. Thank you so much, and I'll see you next time. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

The first Volts post went up on Dec. 7, 2020. Believe it or not, that was almost three years ago. I want to mark Volts’ third birthday with a few reflections, a couple of fun announcements, and a request. I hope you will indulge me. Volts is subscriber-supportedThere have been a lot of new subscribers since the last time I sent out one of these notes and it occurs to me that some of you more recent arrivals — or some of you who have only heard the pod through Apple or Spotify or whatever — might not know what the basic deal is around here. So here’s the short version. I left Vox to start Volts three years ago with three goals in mind. First, I want to be useful. Clean energy is getting tons of attention these days and lots of people are curious about it, or want to get involved, or are involved and are curious what’s going on in other parts of it. I want to arm those folks with ideas and information. I’ve read and seen enough dire warnings about climate change; I want to show what people are doing about it, and by proxy, all the things you can do about it. The clean-energy transition is a vast puzzle made of many, many smaller puzzles, and they all need people working on them. Second, I want to keep myself (and my subscribers) from spiraling into climate doom, and I’ve found that the No. 1 best way to do that is to highlight all the clever, thoughtful, ambitious, good-hearted people out there trying to help. It’s like Mr. Rogers said: when you’re feeling down about looming fascism and climate chaos, look for the helpers. And third, I want to remain independent, to do this work without being obligated to or constrained by any big media organization, or the hedge-fund bros who own so many of the media organizations, or advertisers, or think tanks, or NGOs, or wealthy patrons. I don’t want to owe anything to anyone except you, the readers and listeners. So I don’t take advertising and I have no sponsors. Volts operates, and I survive, entirely thanks to the income I receive from paid subscribers. This is, I have been reliably informed more than once, a bonkers way to do things from a financial perspective, but I’m a stubborn old Gen Xer and this is how I wanna do it. But I’ll be honest: while the number of Volts subscribers has risen with gratifying consistency — there are more than 53,000 of you now and I love each and every one of you as individuals! — the number of paid subscribers not kept pace.So this is my once-annual direct ask to everyone reading or listening: if Volts has helped inform or inspire you over the last three years, consider paying to support it, and me, so that it can continue. A subscription is $6 a month or $60 a year (or you can make a one-time donation). For the price of one night out with your family or friends, I’ll give you a whole year’s worth of podcasts! It’s like a dollar a podcast! That’s an amazing price for a free podcast. Why should you pay to subscribe? The main reason is simple: pay if you find the work valuable, you want me to be able to continue doing it, and you’re in a financial position to do so. Pay so that those who aren’t in a position to pay can still benefit from it, so the ideas and information can reach the broadest audience.But just to sweeten the pot a bit, let’s discuss some changes in the works!Ch-ch-ch-changesWe’re giving Volts a few little upgrades in the coming year. Why do I say “we”? Because I’ve brought on Sam — a longtime Volts subscriber and climate professional — to advise and help with these upgrades so I can continue to focus on the main work. You’ll be seeing his name around in the comments and on emails coming from Volts. Be nice to him!I mentioned looking for the helpers. We also want the helpers to find one another. So we’re going to do more to help subscribers connect with, learn from, and collaborate with one another.We also want to add some benefits for paid subscribers. I’m pretty militant about all the pods and essays being free to everyone — as I said, I want to be as useful as possible — but that doesn’t mean we can’t have some goodies for my beloved inner circle. So what does all this mean in practice?All subscribers, paid and free, will receive the following upgrades:🔓 We’re opening up the comment sections to all subscribers. I know first-hand that subscribers have a ton of knowledge and insight to share. Moving forward, each new podcast will be an opportunity for all of you to share with one another. 🤝 In the same vein, there will be monthly community threads in which subscribers can share what they’re working on or particular challenges they’re facing. I’m always getting questions from subscribers that I can’t answer but I suspect someone else in the Volts audience can. I want to get y’all connected to one another.⚡ For newcomers, we’re developing a Jumpstart series. If you want to quickly get up to speed on transmission, or thermal storage, or state-level energy politics, we’ll gather all the podcasts and writing you need in one place.Paid subscribers will receive the following upgrades:💌 We’re starting monthly mailbag pods for paid subscribers only. You ask questions, I attempt to answer them. Ask about energy stuff, or political stuff, or how I work, or why I own so many damn jackets. Anything is fair game.🎟️ When Volts attends and/or hosts an event, we’ll offer a handful of free or discounted tickets to paid subscribers whenever possible.➕ Other paid upgrades to come …These are all subscriber-requested changes. As we get going, we may add other things — revisiting past content in other ways, contests, maybe some merch. Who knows what could happen! (We’ll be asking you soon what you’d like to see.)Sign up as a paid subscriber, become a legendSo that’s my yearly plea. If you would like to help me keep doing this work, you can help in any of the following ways:* Sign up for a monthly or yearly subscription. * Substack subscriptions auto-renew unless you tell them not to. Some people really don’t like that! Those folks may make a one-time donation here, outside the Substack system. For those who donate $60 or more, Sam will hook you up with a year’s subscription. * You can also give a Volts subscription to a friend or loved one as a green holiday gift. Why, it would make anyone merry!* And finally, even if you don’t pay, you can rate and review Volts on Apple or whatever podcast platform you use — there’s a reason every podcaster says this; it’s enormously helpful — or you can just mention Volts to friends or colleagues. Word of mouth is how we’ve grown so far!Finally, I want to conclude by expressing my endless, unbounded gratitude. Volts is the work of a lifetime for me, not only the best job I’ve ever had but the best one I can imagine. And it’s only possible because of you. So to everyone who has read it, listened to it, or otherwise engaged with or supported it: thank you, thank you, thank you. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, longtime solar industry analyst Jenny Chase, author of Solar Power Finance Without the Jargon, catches us up on the current state of the global solar industry and looks to where it’s going.(PDF transcript)(Active transcript)Text transcript:David RobertsJenny Chase went to work for the London-based startup New Energy Finance in 2005, straight out of university in Cambridge. She founded its solar analysis team and helped establish some of the first reliable indexes of prices in the solar supply chain, as well as some of the first serious industry models and projections. The solar power industry barely existed then. Now solar is the cheapest source of new power in most markets and the International Energy Agency expects it to dominate global electricity by 2050. Throughout that heady transition, Chase has run and grown the solar analysis team, even after the company was bought by Bloomberg and became Bloomberg NEF in 2009. It has become one of the most respected teams in the business and a widely cited arbiter of industry data.In 2019, Chase wrote a book summarizing what she learned over her years analyzing the industry. It is called Solar Power Finance Without the Jargon, but the title is somewhat misleading — it covers solar power finance but also solar power history, technology, and policy. It is leavened here and there with droll bits of biography or advice from Chase and contains an incredible amount of information in a highly compact and readable package, just over 200 pages. A heavily updated second edition was released this month. Also this month came Chase's yearly “opinions about solar” Twitter thread, which is highly anticipated among a certain kind of energy dork [waves].I figured it would be fun to have Chase on the pod to talk about the current state of the solar industry, whether anything but standard-issue solar PV is ever going to flourish, and what the world needs to help balance out increasing penetrations of solar. Okay then. Jenny Chase from Bloomberg NEF. Welcome to Volts. Thank you so much for coming.Jenny ChaseThank you so much for inviting me, David.David RobertsI read your book over the past week and it's just delightful. I really recommend it to anyone. I feel like the title is a little well, I guess it does say without the jargon, but I just feel like the word finance is going to scare off some readers. But it's really just a nice, extremely approachable introduction to this whole thing of solar in the markets and how it's funded and how it's proceeded over the years. So I really was charmed by it. I noticed actually that it had a little bit of kind of autobiography in the first few chapters and I thought it was really kind of funny.I had never really thought about it, but you and I have some parallels in our history. We sort of snuck into what was at the time a relative backwater in the world right around 2004, I think, both of us, and then just kind of hung around.Jenny ChaseAbsolutely. And I can't get another job, so I'm stuck doing solar at Bloomberg NEF now.David RobertsSame, we've been doing this for so long now that I couldn't really do anything else, but we just kind of planted ourselves and stuck around until the area we were in suddenly became huge around us.Jenny ChaseIt's a pretty good place to be planted, though. I mean, back in 2004, I was looking at this industry, and I started specializing in solar in late 2005. And I was like, "One day this might be 1% of global electricity supply, but, you know, that's worth working on. Even 1%, it's worth working on if we can make it clean." And last year, it was 5%, and it isn't done growing.David RobertsSame, I started covering climate change during the George W. Bush administration. I was like, maybe someday someone will do something about this. Maybe someday we'll pass legislation. And then here we are. PV dominates the world. People are targeting net zero. How things change.Jenny ChaseYes.David RobertsSo I want to ask you, you have been following now the solar industry. I mean, honestly, one of the coolest, most fun, most sort of, like, optimistic of all the dark things happening in the world. I know so many people who basically are pinning, like, 98% of their hopes for the future of humanity on this market that you follow. So what a fun thing to be following. But here I'll start with a very big, broad question. A big part of the history of solar that you recount in your book, and I've written on this before, too, and there's been academic papers on it is a series of public supports.Basically, you get the German feed-in tariffs. You get huge Chinese manufacturing subsidies. Spain had a little period of insane feed-in tariffs for a while. So it was definitely public policy that brought solar from obscurity, where it was when you first started following it, to borderline ubiquity now. And I just wonder, could solar survive now? Could solar PV would solar PV survive and thrive now without public supports?Jenny ChaseOh, absolutely. You couldn't stop solar if you wanted to stop solar, David, at this point. Those subsidies, yes, they were needed in the early years. They drove growth. They drove companies to actually make these things. But the thing about humans is that when they make things, they get better at making things. And that has been an incredibly powerful story. Solar modules cost over $100 per watt in the 1970s, in today's money. By the time we started in 2004, they cost about — it was about $4 a watt. Stayed that way for about four years because there was very strong demand, again, driven by subsidies, and then started falling again.And, you know, last week they were 12.8 U.S. cents per watt. And I am super annoyed that didn't get into the book, because, of course, I had to lock down the book four or five months ago.David RobertsWhat was the cutoff price that you managed to squeak into the book?Jenny ChaseI think it was 24 in the end. And I hope anyone reading the book realizes that I knew that was not the final price.David RobertsWell, this is the insane thing about this market, about this whole technology, is it's such a moving target. And the reason I started with that question is that I think to people in our industry at this point that has sunk in. It's clear that this is a juggernaut, that this is the cheapest thing going now and that you couldn't stop it if you want to. But I honestly don't know if that alone just that basic fact has penetrated this sort of general public consciousness. I feel like people generally still see solar as kind of a nice liberal extra whipped cream on top kind of treat you get with some extra subsidies.But it really is the cheapest source of energy now, which is such a fundamental break from when we started, that I just feel the need to repeat it.Jenny ChaseI mean, it is. I would slightly clarify that by saying it's the cheapest source of bulk electricity generation in many countries. There are some countries in northern Europe where it actually probably should be wind that's slightly cheaper. And also it is bulk electricity production. In 17 years of covering the solar sector, I have learned that the sun doesn't shine at night.David RobertsHow many years into your career were you when this sank in, when you discovered this horrendous fact?Jenny ChaseNot very many, but I have to admit that here in Switzerland, I only realized when I had a solar system installed in 2018, quite how bad it can be in the northern European winter.David RobertsYeah, we'll discuss how to get around that. So, PV is now a juggernaut, is growing at crazy rates. Prices are falling at crazy rates. It seems like every week or two brings a new record low price of modules, some sort of record in deployment, some sort of wild new forecast. Just actually, right here, tell us, because you just came out with a forecast, did you not, for solar for next year?Jenny ChaseYeah. So annoyingly, it's my job, or my team's job, to keep our forecast to 2030 updated. And apparently, we're going to have to start doing 2035 soon, which is just great because we have not nailed 2030 yet, I can tell you. We haven't nailed 2023. So, this week I've been publishing our latest update of the forecast, and our estimate for 2023 rose 5% on last quarter. So, we're now thinking that 413 gigawatts of solar modules will get installed worldwide this year, and 240 gigawatts of that will be in China.David RobertsWild. Have you ever in the 20, almost 20 years you've been doing this, forecasted too high? Like, have you ever overshot on PV?Jenny ChaseSlightly, yes, actually.David RobertsYou did?Jenny ChaseWe had a bit of a moment of over-enthusiasm in 2018, I think. And, like for specific markets, we get it wrong sometimes. I mean, I thought South Africa was going to be five gigawatts this year because of the rate they appeared to be going in May and June, but that has actually slowed down a bit and I dropped that from five gigawatts to 3.5 gigawatts. So you can be quite wrong in the granular sense. And of course, when you're covering the market quarterly, you have to cover that sort of thing. You can't just say, "oh, it all comes out in the wash," even though in the long run it kind of does.David RobertsYes, it does all seem to be coming out in the wash in the long run. The line is only pointing in one direction, as they say. So I guess one of the things I'd like to talk about then is it seems like in terms of continued and accelerated growth in PV, the technology is in place, it's cheap enough now, the manufacturing is in place, the market is fairly robust, there's a lot of supportive public policy now. There's a lot of money, you know IRA being the notable example.Jenny ChaseYes, I mean, you Americans love throwing money at things.David RobertsWell, we can't do anything else. Our government is so broken that throwing money is literally the only public policy tool remaining to us that cannot be sort of mired in process. So everything's a nail. So yeah, we're throwing a lot of money at solar.Jenny ChaseCreates a lot of green jobs.David RobertsYes, that's a lot of wind at the back of solar. So let's talk about then, what are the restraints now on solar going forward? What are the constraining factors? I don't think it's any longer money and I don't think it's any longer policy, at least big picture climate policy, what's now holding it back?Jenny ChaseSo, at the moment, it's grid. If you're sitting there with a pot of money and you're trying to put it into solar projects that will generate and sell electricity and there are a lot of people who are in that position, many of whom are my clients. The problem actually is finding somewhere where you've got land, where you can get permission, and where you can get a grid connection, and it's mostly actually the grid connection we really need to build out the grid.David RobertsIs that true everywhere? Is that true in every market you look at? Or is the U.S. particularly bad on that for some reason?Jenny ChaseNo, it's everywhere. It's literally everywhere. If you were to go to a solar conference anywhere in the world, walk into the room and say, "oh, here in South Africa" or "here in Turkey, grid is the main constraint" and everyone will say "this person knows their stuff."David RobertsYou can sound smart everywhere now. That's interesting. It sort of bespeaks, I think, something then maybe universal then, rather than some quirk of U.S. policy or something like that.Jenny ChaseExactly, I mean, basically, around the world, we've built grids for centralized power plants which made a certain amount of sense when we had centralized power plants. But to get all this cheap electricity from wind and solar to market, we are going to have to build some more wires.David RobertsYeah. And is permitting just securing land in and of itself, is that also a universal thing, or is that somehow uniquely U.S.? Because we really do have a tangle.Jenny ChaseYou do, but challenges with land, they look different in every country, but it is quite universal that it's not easy to just grab a patch of land and have the rights to long term build a project on it.David RobertsWhere are the markets where buildout is happening fastest? And is that —Jenny ChaseChina. It is China.David RobertsI guess China is always the answer to that question, it's kind of a cheat. Are they doing something with their grid that like — I mean, are they just building, is that the simple answer? They're just building a lot of it.Jenny ChaseThere's two things that China is doing. First of all, it's got a very coordinated rooftop program, so a lot of the provinces are building a lot of residential and commercial solar. And secondly, and separately, it's building energy megabases out in the desert and building ultra high voltage transmission lines out to them. So it's got this two pronged strategy. Plus it's got a bit of other utility scale being built as well. I mean, basically, China is just building everything it's got.David RobertsWho's building fastest? The answer is China, on more or less everything.Jenny ChaseAlways is. I mean, 240 gigawatts, we think will be built this year in China and the entire world market last year was 252.David RobertsYeah, that's wild. You look at these models that say we need X amount of PV to hit our targets, to hit net zero by 2050 or 1.5 or whatever it is, and they look so big and eye-popping, they look to the naked eye sort of like impossible, especially when you break them down. Like, we have to build a utility scale solar plant every five minutes from now till the end of time and they seem impossible. But China is moving at that pace. It is moving at the crazy pace we need to. It's possible.Jenny ChaseIt absolutely is. Yes, China is moving at that crazy pace. And to be honest, solar modules are super cheap and solar is actually quite easy to build compared with everything else we've built.David RobertsYeah, well, it's just Legos, right? I mean, it's more like Legos than a nuclear plant, for instance.Jenny ChaseVery much more like Legos than a nuclear plant. I mean, I think that the engineers working on solar plants would probably say that there is a certain amount of skill to doing it properly. And there is, of course, but I think you can build a decent solar plant with relatively limited technology.David RobertsIn terms of all the constraints or headwinds that you mention in the book, let's talk about these trade disputes and trade barriers, because we're hearing now about tariffs. Talk about tariffs as flying everywhere. Trump put a bunch of tariffs in place.Jenny ChaseActually, it was Obama that put the first tariffs in place.David RobertsOn solar?Jenny ChaseOn solar, yes. 2012.David RobertsInteresting. And they've been in place ever since. And I'm just wondering, on the macro level, is this just going to change where the panels go and when? Or is this going to be a constraint on absolute growth, do you think?Jenny ChaseSo, trade barriers are the reason that we generally regard the U.S. as this weird little market, not really a proper one. The U.S. would definitely be installing more solar if it hadn't been for constraints, particularly last year. First of all, modules do cost two to three times as much in the U.S. as in Europe and other markets.David RobertsThat's just because we're not buying the super cheap Chinese ones. Is that so?Jenny ChaseYou're not buying Chinese. But also, last year there was the Uyghur Forced Labor Prevention Act, which means that anything coming into the U.S. has to have a pretty strong verification chain showing that every part of the value chain was made outside the province of Xinjiang in China. And functionally, it seems to have stopped a lot of Chinese brands getting in at all, although Indian brands possibly using the same wafers don't have so much trouble.David RobertsDo you think? Because you know IRA, and recent Democratic legislation in the U.S. puts a big emphasis on trying to onshore or friendshore things, not just solar panels, but also the materials that go into them, EVs, batteries, etc. Do you think that these trade barriers, which are more I think the U.S. probably has the most of them around solar at this point, or at least as much as anybody else, are going to — like, is that price differential going to settle out? Is it possible, I guess what I'm asking is, do you think it's likely that the U.S. is going to bulk up its own manufacturing or the manufacturing of its friend countries, whoever those turn out to be, that that price will even out relatively quickly, or is it going to take a while?Jenny ChaseI think that the U.S. will probably have a lot of its own manufacturing, maybe even for the more complex parts of the value chain, because most of the solar capacity announced in the U.S. so far has just been for the module stage. And you can make a solar module in a garage if you have to. That's not the high tech bit of the chain. I don't think that the price differential will even out. I don't think that the U.S. will get to the scale and the integration of manufacturing bases that China has anytime soon. I mean, China is genuinely good at this.This is not a matter of cheap labor. It's not a matter of not even cheap energy. It's that it does the whole thing there. And they've got very, very good at it.David RobertsOh, so this is not just a matter of their stuff is cheaper because they have I mean, I think that's the sort of popular perception, right, is that they just have cheap labor and lower standards, etc., etc. But there's genuine technological expertise that's difficult for us to replicate.Jenny ChaseAbsolutely. I mean, China is the reason why solar is not a cottage industry anymore. The Chinese manufacturing industry is a juggernaut. It's viciously competitive within itself. The companies hate each other. If you're imagining some kind of monolith, that is not the case.David RobertsWell, China is very big. There's plenty of room inside it for competition.Jenny ChaseThere certainly is. So now the skill to ring out final tenths of a cent out of the cost of making a module, it's high tech engineering, it's very careful, but it's also something you've just got to have done a lot of and know exactly how it works.David RobertsIs this something you lose sleep about? Do you think the U.S. energy balance in 2030 is going to be substantially changed by the presence of these tariffs?Jenny ChaseI think that the one reason the U.S. isn't having as much of a boom as other countries in solar is the tariffs. So I hope the IRA can shift it. I mean, from an external perspective, the IRA looks like pushing down the accelerator really hard on a car that has the handbrake on.David RobertsYes, the handbrake being the trade barrier and the permitting.Jenny ChaseAnd the permitting. And the grid. To be fair, there's stuff in the IRA about the grid as well, about building that out, and I know Jay Gashar(sic.) is working on it.David RobertsAnd the final question about trade barriers: Are these more or less consensus — is there any prospect of these going away? Or do you think these are more or less kind of a permanent feature at this point? This is how we're going to do it?Jenny ChaseI think, in the U.S. and India — that's the other weird little market — they are not going away anytime soon. These are two countries that are quite committed to building a domestic manufacturing industry, even if it costs more.David RobertsAnd you think it'll be a long time before either of those are at the level of cost and technical expertise of Chinese companies?Jenny ChaseIt'll be a long time. I mean, you could say that at this point, even just making modules as good as China was making three years ago is actually all right. You could say that's good enough.David RobertsOne other constraining factor which I have been interested in for a long time and think is controversial, at least in my little corner of the world, is this notion of renewables in general, but especially solar, eating its own lunch, as they say. Price cannibalization, as you call it, in the book, which is a simple — I don't think there's anything particularly technical about — it's, just that all the solar is producing at the same time when the sun's out. So the next solar plant you build is going to be directly competing with the existing solar plant, producing solar at the exact same time and thus mildly bringing down the price. The more you build, the more the price comes down.I feel like the conventional wisdom, call it like five years ago or ten years ago, was that this phenomenon of renewables eating their own lunch is going to kick in at a lower level than has turned out to be the case. And I just wonder if you agree with that — if you agree that this is maybe less severe of a problem than we thought a while back?Jenny ChaseI think what we've realized is that most grids actually have a fair amount of flexible capacity. So you can turn down gas plants in the daytime and of course you want to because it's good if you can turn down the gas plants and burn less gas. It is starting to be a problem though we do have zero or negative power pricing events quite regularly on sunny weekends in Europe. Now California has them, bits of Australia have them. There are times of the day when power on the spot power market doesn't cost anything and you could say, well, what's the problem?And like, as a first approximation, there isn't actually really a problem.David RobertsYeah, free power doesn't seem like the worst thing that could happen to you.Jenny ChaseBut it does, of course, mean that if you want to build another power plant that's the same, you are competing with free power a lot of the time. And you can do it to an extent, because while solar is getting cheaper, you still build for those — they call them shoulder periods when solar is not at maximum and the power price is not zero. But it is still a concern. And, to be honest, that's what keeps me up at night. The fact that we will get stronger negative feedback mechanisms kicking in, particularly in places that don't have a lot of flexible capacity, who are maybe doing coal and nuclear rather than gas and hydro.On the other hand, one big update between the first edition of my book and the second is that batteries are just a thing now.David RobertsYeah. Which is newish in the world, I think. New enough that we don't totally know how it's going to affect things.Jenny ChaseYeah. And batteries have to be built and obviously they have to be manufactured, they have to be built. They are actually really expensive. I mean, when we try and calculate the economics of batteries, I'm not entirely sure why most people in Europe are building them, but they are.David RobertsYeah, you seem skeptical of the economics of residential batteries too.Jenny ChaseI am very skeptical. I attempted to calculate the payback period on my parents' battery system in the UK, and it's more than 20 years. I'm like, "Mum, did you know this was that bad when you bought it?"David RobertsAnd yet you also say that you've underestimated batteries. What do you mean by that? What are they doing more than anticipated?Jenny ChaseGetting bought. No, I mean over 70% of residential solar systems in Germany and Italy added this year now have batteries attached. And that does make a huge difference to this power price cannibalization problem because it does mean that you can shift your output to the evening and the night. And then what keeps me up at night is the seasonality thing.David RobertsYeah, so you feel "okay" then about the, sort of, sun going down problem, the diurnal problem, smoothing out, like Jesse Jenkins and I did this a few weeks ago about the sort of timing of intermittency of solar and there's second by second swings, there's minute by minute swings, there's hour to hour swings. And it sounds like you think and I think he thinks that batteries are going to sop up most of the sort of short term variability. You're more confident than that than you used to be, let's say.Jenny ChaseI certainly am, yes.David RobertsWell, this is another question I have about this. And maybe as someone who's watched markets grow and develop, you have some insight into this naively. I would think if we have this problem in a capitalist society, in a market where during certain periods of the day, we're producing this valuable commodity for free. And so it's just sitting there. It seems to me naively, that you're going to get a stampede of people finding ways to use that power, finding ways to use that excess solar power. Not just you could shift demand under those periods of high sunlight and just use it directly, or you can find new ways to store it or shift it or move it around or something.But this seems like the kind of problem that markets ought to be very good at solving. So why should I worry rather than just thinking like this will solve itself? You say high prices are the solution to high prices. It seems like free power ought to be the solution to free power also.Jenny ChaseSo I think it is. But historically, people have not always responded to power price signals. I mean, certainly on the residential level, people have not always responded to power price signals quite the way you would expect them to. And on the commercial and industrial level, you often have to spend a lot of capex to take advantage of these low prices. Like for making hydrogen, for example. You can make hydrogen with electricity, but the electrolyzer, which is the equipment that makes the hydrogen, is really expensive. So you don't want to buy all that equipment and run it for like 1000 hours a year.You want to be running it at least 50% to 80% of the year. And there's a lot that we can probably do with stuff we already have, like flexible charging of electric vehicles is an obvious thing that we should all be doing.David RobertsWater heaters, hot water heaters.Jenny ChaseWater heaters are good. Yes, heat pumps. Although again, in northern Europe, the issue with heat pumps and heat pumps are brilliant, and I have one, but the issue is that they do run a lot more in the winter, and that is when we do not always have the sun.David RobertsYes, this is back to balancing out solar, which we'll return to later. So I want to ask about — it's funny, normal people, when they get excited about solar, there are a bunch of call them sort of exotic forms of solar that people love to get excited about. And at some point in your book or Tweet threads, you have poured cold water on all of the following: thin film solar, thermal electricity, floating solar on water, agrivoltaics (i.e., solar on the farm building), integrated solar, perovskite solar. And I guess I'm just wondering, do you think that standard PV built in the standard way is such a juggernaut that all of these things are going to turn out to be more or less kind of like frivolous extras?Are any of those going to be real? Because you've broken a lot of hearts. There's a lot of people who love — in each of those categories there's a lot of fans whose feelings are hurt when you come along and say, "It's just solar PV on a boat, don't get so excited." Are any of those worth getting excited about?Jenny ChaseNo, I wouldn't get excited about any of those, sorry. I mean, some of them are worse than others. I think the best thing I could say about solar thermal electricity generation is it's not quite dead yet and floating — so the big thing about floating solar is that you could put it on water and sometimes it's really easy to get the grid and the use of the site on water. So, for example, our hydroelectric dams, the water is usually already zoned as electricity production and there's a grid connection and there's generally anticorrelation between the output from the hydro dam and the solar panels.So, like in summer, the solar panels are going into the grid so you can save some water. So it's good, but it is still solar on a boat. And agrovoltaics, I'm worried that people are a little bit overexcited about that because, if you do it wrong, it is bad solar subsidizing bad farming. There are some crops, like berries, maybe berries you can grow under things with shading, but how many berries do we want to eat as a civilization?David RobertsBut thin film, more energy dense, but higher cost.Jenny ChaseLess energy dense, I would say.David RobertsOh, wait, is that —Jenny ChaseFirst Solar is — So the only thin film player of any significance left is First Solar.David RobertsOh, right. Less energy dense, but allegedly cheaper to crank out because you can do it on a sheet.Jenny ChaseNo, it's more expensive now.David RobertsWell, then what the hell?Jenny ChaseThe reason First Solar is having a great time now is because plants in the U.S. are going to get 17 U.S. cents per watt under the IRA as a production tax credit.David RobertsGood grief.Jenny ChaseAnd because the U.S. has trade barriers on imports.So does thin film — I mean, if it's less energy dense and more expensive, then it's hard for me to think of an obvious application for it. What's left for it to do?Lower embodied carbon, actually. But when we talk about thin film, we really are talking about First Solar at this point because everyone else has failed. And to do credit to First Solar, it's a company that has met its milestones, scaled up meticulously, has a great recycling program, and has a pretty plausible claim to having lower embodied carbon per watt than crystalline silicon.David RobertsWho's using that?Jenny ChaseAmericans. Nobody else would buy them. They're more expensive and less efficient.David RobertsBut on their roof or where — ?Jenny ChaseIt's ground mounted mainly. There's no reason why you couldn't put them on the roof, but because they're less efficient, you would tend to go for the crystalline silicon option.David RobertsAnd then the one that really hurt my feelings was this about — I used to get so excited about all these ways of integrating solar into building materials, right. Like, they say you can put solar cells in windows so that they're sort of ambiently generating all the time. They say they can put it in concrete. Like you can put them on fabrics now. Like if you read the lab stuff, the MIT press release world, there's all kinds of cool stuff you can do. Integrating solar into other materials. You just poo-poo all that — is there nothing to any of that?Jenny ChaseDon't put them on fabrics. You know the really great thing about glass, it's one of the oldest materials we've got and it doesn't degrade, it doesn't flex. It's pretty hard, it stays transparent. It's a really great material to encapsulate your modules on. Every attempt to make flexible solar has ended up with worse encapsulants that will almost certainly degrade after a few years.David RobertsSo you haven't seen anything in the building integrated world that you think even on the long term has a chance of surviving.Jenny ChasePeople say it's pretty. I mean, if you want to pay more for pretty. Personally, I'm interested in electricity generation. But like most of these solar windows, they are just bad. They are just bad PV that is being sold as a gimmick and it's barely worth wiring up, in all probability.David RobertsWell, that's just a bummer. I love this sort of Sci-Fi vision of your entire infrastructure sort of ambiently generating power all the time because it's all sort of got solar cells in it.Jenny ChaseBut just put proper solar panels on the roof, it's the same thing, except it probably works better and it certainly costs a lot less.David RobertsFine. Ruin my Sci-Fi vision. And perovskites, the other great white hope of this whole world at this point are competing with SMRs to be the perpetual next big thing. The next big thing in a few years, forever? Is that going to happen? Is it happening? Is it getting closer? Are we closer now than we were three years ago? Or is it still at the pure hype level?Jenny ChaseWell, I was walking around the world's biggest solar conference in Shanghai in May, and I was having a little bit of a panic because I thought I'd more or less finalized the book saying some relatively uncharitable things about perovskites. And every single company was like, "perovskites!" I actually saw my first perovskite, and then the Chinese manufacturers were like, "oh, our research arm has got perovskites." "Oh," Hanwha Qcells was like, "oh, we've made an investment." First Solar was like, "we've made an investment." I was like, "oh, god, is this going to make my book look stupid in six months?"But to be honest, nothing has come of that. Which doesn't mean that nothing will, because it was relatively recently. But personally, I think they were just having a little moment of, "oh, everyone's saying this. We have to seem like we're ahead of the curve." And they all have a skunk works where they're investigating this sort of thing, and so they basically release some of the lab results. And I think it's at least five years away.David RobertsAnd also, one thing I've come to appreciate more looking at this stuff over time is even if the perovskite tech proves out faster and better than we expect, it's just like you're so far behind the eight ball at this point trying to catch up with PV or squeeze in past PV anywhere. That the tech thing is not even the main problem. It's just your scale wise. Like, where do you start? Where do you find a foothold?Jenny ChaseNo, really, the tech thing is the problem. The problem is that this stuff does not have a lifetime of years.David RobertsOh, it degrades quickly?Jenny ChaseExactly. I mean, the problem with perovskite is it degrades really quickly. And I don't think anyone is claiming that they have a completely stable product that's ready for commercialization at any price. But the other thing is that if perovskite does succeed, it won't be as a standalone product. It will be as a second layer on top of crystalline silicon. So it will backpack.David RobertsOh, interesting. So it will be like an improvement to existing panels.Jenny ChaseExactly. And it will make a lot of money for the company that figures it out.David RobertsAgain, sort of from the outside, it looks like your basic PV panel, your basic solar photovoltaic panel looks a lot today like it did ten years ago or 20 years ago, to my eye. But one of the things you describe in your book is that there's actually lots of micro improvements happening. There's lots of improvements happening within these PV products. So maybe just talk a little bit about sort of like what tech improvement looks like within the PV category and how much headroom is left for just the standard PV panel to get better.Jenny ChaseSo the first thing I would say is that the layperson doesn't need to know anything about exactly how a solar panel works.David RobertsThank goodness.Jenny ChaseThat said, obviously, there are incredibly talented engineers who are working really hard to make that panel more efficient and produce the same output or more output with fewer materials. And so the big improvements over the last 15 years have been wafers have got thinner, so there's much less polysilicon used per watt. It used to be about 10 grams per watt in 2008, and today it's 2.6 grams per watt.David RobertsAnd that's just a cost-saving.Jenny ChaseIt's a cost-saving. It's also an embodied carbon saving, if you care about that, because polysilicon is a very energy-intensive step of the value chain. The wafers have got bigger, so you can make them out of bigger ingots and then they're easier to handle and they have a lower ratio of the gaps between them. So the standard wafer used to be what we call 156 mm, which is the side length, and now the standard one is 182 mm. So that saves all kinds of costs. There's been a move in cell architecture, first of all, from aluminium back surface field to passivated emitter rear contact (PERC), which is currently the standard.But we're just moving to TOPCon (tunnel oxidated, passivated contact).David RobertsOkay.Jenny ChaseAnd to be honest, I can barely remember what that stands for. I never know what the difference is.David RobertsBut from the layperson's point of view, the upshot here is that they're getting cheaper and they're working a little better.Jenny ChaseAnd more efficient. And there are theoretical limits to how efficient they are.David RobertsAnd where are we at now? Like 20 — state of the art is like 22%. Is that right?Jenny ChaseState of the art is probably 24 or 25% of commercial production. Obviously, most modules are a bit worse than that. I think it's about 22% for the typical module this year. And it will be a bit better next year because next year the typical one will be TOPCon, not PERC.David RobertsAnd that 25 could get to — ?Jenny Chase34, perhaps. I think we've got a roadmap to 34%.David RobertsNo kidding. That's not a small amount.Jenny ChaseI think we hit that by 2050. It's not a small amount.David RobertsThat's a third more power coming out of our panels.Jenny ChaseThe same space, yes.David RobertsThat's more room for improvement than I thought. And that's just with polysilicon PV?Jenny ChaseJust with crystalline silicon? No, that involves a heterojunction that does involve a second junction on top of that. So another layer of another sort of semiconductor, whether that is perovskites or something else. Because when you stack your layers of semiconductor, you absorb different wavelengths of light with different semiconductors and so you get a higher efficiency.David RobertsInteresting. I didn't know there was that much headroom left. And whatever happened to concentrating? I always thought that it was very clever the concentrating solar panels, where you just use a cheap plastic lens to concentrate the light, and then you get more intense light and you can get more sort of, comparatively more power out of the light with a special kind of solar cell. Did that come to anything?Jenny ChaseCells got cheap and lenses stayed expensive. Also, if you're doing that, you've got to make sure that the angle that your panel is mounted at is correct, because otherwise it's focusing the light on the wrong place and it turns out to be way cheaper to use ordinary solar cells. And it doesn't matter that much if they're oriented right, rather than have a super duper lens thing that has to point the exact right direction. So, CPV is dead.David RobertsAnother clever tech, RIP. And what about — these are you know, we're mostly talking about improvements to the panel and the cell. What about, you know, I saw a company that is using steel for framing instead of aluminum. I think I could be getting that wrong, but I think that was it. The stuff around the panel, the brackets, and the frames and the mounts, is there a lot of headroom for improvement in that stuff?Jenny ChaseI think there probably is. So steel is heavier than aluminium, so I think this is for the frame of the module. And module frames used about 2.8% of world aluminium production last year, so it's not actually small. Now, steel is lower carbon than aluminium, but it is heavier. So I suspect the maths on that might be a little bit complicated. But if you don't have to transport them very far, that's good. And of course, when you've got solar sitting in a field held up on steel structures, then there are improvements to be made to the design of that.So it catches the wind less, so it's more sturdy with the same amount of materials.David RobertsAnd just in terms of mounting and tracking the sun, what's the state of the art? I always wondered, is it going to end up being cheaper to just make the cheapest possible panels with the cheapest possible installation? Or is it worth spending the extra money to get fiddly precise tracking of the sun throughout the day?Jenny ChaseSo modern trackers are not particularly precise, actually. They just more or less follow it from east to west, because, unlike concentrated photovoltaics, they don't have to be precise. So the really rough rule of thumb we have is that tracking costs about 4 cents per watt more in Capex and gives you 25% more output, which does mean that you put tracking in in sunny places, because 25% more output is more powerful in sunny places.David RobertsRight.Jenny ChaseSo we reckon that you don't really use tracking anywhere, like further from the equator than France, and you use tracking in sunnier places. Tracking also takes more land, but it also gives you a nicer output profile. It gives you like a table of output profile throughout the day, because you start generating first thing in the morning, whereas if you just make them south facing, you get this peak.David RobertsYou get more into those shoulder periods.Jenny ChaseExactly.David RobertsAnd what about people who think that AI and machine learning is going to revolutionize anything? Is AI or machine learning any help at all in PV, in tracking or anything like that? Or is dumb and simple better?Jenny ChaseThis is machinery tracking moves. It's stuff that's got to be reliable, it's got to be rugged. I'm sort of inclined to say that AI can't revolutionize it, but maybe machine learning can do a little bit around the edges.David RobertsIn terms of markets, one of the things you say in the book is that while the sort of macro growth has been relatively steady and predictable, there's been some surprises on where this happens. And it's funny, I thought in your forecast now you have this category "rest of the world," outside of the major markets, which you are sort of using as kind of a buffer. You're just sort of like adding a bunch of capacity in the rest of the world category just as a buffer because you keep underestimating; everyone keeps underestimating how fast things are going to go. And I know you said —Jenny ChaseWe don't do that anymore. Now we call it buffer/unknown. And then people ask me, "what's buffer/unknown?" And I'm like, "we don't know."David RobertsExactly.Jenny ChaseThey go away after that.David RobertsThis to me is funny as we've been underestimating growth in PV so long that at this point we're just like, "Here's our forecast... plus some. We don't know where or why, but there's probably going to be more."Jenny ChaseExactly. And we need it as well. Even within a single year, we tend to find it gets taken up by existing markets being more than anyone thought.David RobertsOh, funny.Jenny ChaseBut my clients do tend to get mad at me if that's more than about like 30% of world demand.David RobertsWow, 30% is a substantial amount of like, "we don't know" buffer.Jenny ChaseI mean, that is by 2030. So, there's a lot of "we don't know" by 2030.David RobertsYes, true. I wonder, I was going to ask about this later, but this seems like a good opportunity: Why is it, and this, I guess, is kind of a sociological or maybe even like a psychological question, why is it that it is so much easier and safer to make a conservative forecast that ends up being wrong on the downside, which is like 99% of solar forecasts to date, than it is to try to be as optimistic as reality? Like the one thing I come back to over and over again, and you mentioned it in the book, is like the one solar forecast that's been even close to reality was Greenpeace's sort of wild forecast early in the 2000s, where all they did — it was viewed as wildly optimistic — but all they did is just say, "Well, here's the improvement rate, here's the learning rate. What if that just keeps happening?"Jenny ChaseNo, they just took the growth rate of build and extrapolated that. Oh, it was simpler than that. They don't know what a learning rate is. And yes, it was the best mainly because it was the highest. I'm just going to say it's also not particularly useful if you're trying to decide what world markets to go into or sort of adjust your expansion strategy if someone's just telling you, well, it will be 40% growth per year forever.David RobertsRight. Well, you want something more granular than that, I guess, if you're in the business —Jenny ChaseAnd more regularly updated and where someone is actually sitting behind it, being somewhat responsible for being wrong.David RobertsRight. But why is it, why do we always under predict? And why is there no like, people seem to feel safe under predicting, whereas clearly there's a much greater fear of overestimating such that everyone's underestimated every time forever. What explains that?Jenny ChaseI mean, you can't predict complete transformation and the more you know about a market, the less you can predict that it will totally change, I think. So obviously, if you are an expert on the energy market, you can't predict it. You don't want to predict that everything becomes totally different. Also, like if you go around with wild numbers, everyone just calls you boosters and says that you're just selling something which is not entirely untrue. But mostly what I've been trying to sell is accuracy.David RobertsYeah, it's a little crazy. People would almost rather be inaccurate than risk that than risk being viewed as a booster. It seems like in a biz where you're literally predicting and projecting seems like the social penalty for inaccuracy ought to be maybe higher than the social penalty for being optimistic.Jenny ChaseThe thing is that there are no prizes for just coming up with the biggest number. I mean, you can do it, but it's not particularly helpful. I mean, throw a pin at the dartboard and if you happen to be the closest, it doesn't give you any real insight. And also, solar is weird. It's the first form of bulk electricity we ever have had that doesn't involve turning something, turning a generator. So it is a little bit unique. It's the first ever semiconductor form of electricity, so it is unique. But it's also you cannot extrapolate a growth rate forever because you end up with the whole world covered in solar panels."So you do have to recognize that there are limits to this and there are negative feedback mechanisms. And on the local level, we already see some of those negative feedback mechanisms.David RobertsI get all that, but just at a certain point, like the IEA, if I'm wildly under predicting solar again and again and again and again and again and again, eventually those arguments have to lose some of their power, don't they? Like whatever limit you're worried about or trying to predict, it's not happening statistically on the odds it's probably not going to happen next year either. There will be limits, obviously, like the learning rate and the growth rate and all that can't project out to the future the way they are forever.Jenny ChaseThe learning rate, you can actually, because it's an exponential decay, so you can double capacity as many times as you like. You're never going to get the price to zero. So the learning rate, you can theoretically go out forever. Don't ask me what's happening to my experience curve this quarter because the price is way below the experience curve, and this is causing some real construction difficulties.David RobertsReally?Jenny ChaseYeah, so I feel some sympathy for the IEA as well, because what they were trying to do was not make a prediction of solar. What they were trying to do was model world energy supply in a sort of continuous way that had worked when the world electricity, worldwide energy supply was fossil fuels and nuclear. And then they were trying to tweak the sensitivities of that model and bring it to the future. It was not a model that was designed for transformative change, and they have changed that around, and they have got whatever their equivalent to the net zero scenario is called, and they have changed that, to be fair.David RobertsYeah, people do seem to be trying to catch up, but even the people running faster and getting more optimistic are still, as far as I know, undershooting.Jenny ChaseIt's more complicated, though, than just drawing a line on the chart. At least, I mean, for my team, it isn't actually that much more complicated, but when you've got to put things together and make sense of it, be like, "okay, what is power price volatility in California in 2030 if we project this out?" Then you do get some very strange-looking effects. And you can either spend your life analyzing those strange-looking effects and trying to figure out where you should put your money in that, or you could be a little bit on the conservative side.And, I mean, we've been talking like it's all people in developed countries. And the biggest problem my team has is that analysts who have become experts on the energy of, say, Indonesia or Brazil find it very difficult to imagine this strange thing coming here and knocking it all over. And I don't feel like I can go into emerging markets and say, "guys, you're all wrong, it's going to look like this." At least not as forcibly as I maybe would like to.David RobertsYeah, there's something to that. Like, psychologically, the more you know about a particular thing, the more sort of skeptical you are about radical change happening to it, the more reasons that change won't happen that you can cite. So when someone just comes in and says, like, "I don't know, I just got a gut feeling that miracles are going to happen and it's going to be more than that," I can understand why they're greeted with skepticism. But again, if that goofball turns out to be right over and over again, repeatedly for 20 years, at a certain point you have to accept that miracles are going to happen.They keep happening. Speaking of that, where are the markets? Like you mentioned that some markets have sort of like taken you by surprise. And that's one of the things that's kind of skewed your forecast in the past, is that things take off where you don't necessarily expect. What are some examples of that? Where is solar taking off now that people might not popularly know that it's happening and where might be next?Jenny ChaseSo, I have no idea what's happening in Pakistan, but it is importing a load of modules from China, four gigawatts a year. Something's going on in Pakistan, and I have not spent enough time, but I've spent a little bit of time looking at the licensing website. It looks like there's a lot of commercial scale going in there. I am still super excited about South Africa because this is a major medium income economy that has been having crippling blackouts and one of the best solutions is just to buy a solar system and a battery.David RobertsIs this distributed that's happening there?Jenny ChaseMostly, but there's also a bunch of commercial and probably mining scale because there is actually no limit now on how big a system you can put in and have it feed into the grid. So there will be some big stuff, but so far it's been mostly rooftop, I think. So, South Africa is exciting. I'm quite excited about Nigeria because Nigeria removed its fossil fuel subsidies earlier this year, and Nigeria has about 15 gigawatts of on-grid power capacity and about 50 gigawatts, very roughly, of generators that run on diesel and gasoline.David RobertsWhoa, wait, they have more than twice the amount of personal generators than they do actual grid-connected power generation.Jenny ChaseSo the sources are not great, but it's probably more like three times.David RobertsThat's wild.Jenny ChaseIt's called "I Better Pass My Neighbour," and basically, the idea is that you've got a generator when your neighbor doesn't. And running those generators became extremely expensive when the subsidy was removed. So there has been an upswing in small solar and small batteries.David RobertsInteresting. Yeah, I was going to ask I don't know that we have time to get into it much, but I was going to ask what your sort of general temperature is on the whole enthusiasm around kind of like distributed off-grid for people in severe poverty. This idea that you can get distributed PV to people before you can get the grid to them, practically speaking. Do you put a lot of stock in that?Jenny ChaseI've been excited about that for the last 18 years. And if we're honest, the growth has not been —David RobertsYeah.Jenny ChaseIt's grown, but it's been steady and it's still pretty small. And I'm really the only member of the team that spends a lot of time on it because most people have better things to do. It is one to watch, though, and I deeply hope that what does happen with this latest fall in prices is that simple module battery systems and things that can just power a house become so affordable that just a wave of them goes in across Africa and Southeast Asia.David RobertsSo you think there's still the possibility that we could hit the S curve on that that could substantially tick up?Jenny ChaseYes, I do. I think there's still the possibility that things get so cheap that we can leapfrog over the need to build a centralized fossil fuel infrastructure to bring power to Africa.David RobertsInteresting. As a way of wrapping up the main experience, you've had everybody who's watched this market, but I assume it's more visceral for you being so close to it. The main experience you've had is just headlong growth and PV crashing through purported limits on PV, PV crashing through forecasts, crashing through markets, just crashing through things, doing things people said it couldn't do, being bigger, selling more, getting cheaper, et cetera, et cetera. It's really a wild success story. So, I mean, one of the things you address is actually, I'm going to quote your tweet here because I thought it was interesting."When you tell an energy future model to optimize a power portfolio for clean power adequacy, it will give you more wind and less solar than when you tell it to optimize for a least cost electricity sector development." In other words, if you just want your model to do the cheapest thing possible to get you as much power as possible, it's going to do a lot of solar. If you want sort of adequacy and backup and resilience, you put more wind in. First, just to say why that is.Jenny ChaseSo wind blows at night and in the winter. And it's not just better system adequacy, it's that the wind pathway is actually better if you want to get to net zero.David RobertsBetter literally for reaching the goal itself?Jenny ChaseAnd for economics like it's probably cheaper to reach net zero building a mix of solar and wind in nearly all of the world. I mean, there may be a few countries that have so low seasonality that you could just do it with solar, but for most of the world, the lower cost scenario will be at least 50% wind, 50% solar. And if you let the solar get built first, it will cannibalize the daytime and summer revenues of the wind, and the wind might not get built.David RobertsOh, interesting. And then you'll be stuck — you'll whatever, get up to 80% and get stuck. Is that the —Jenny ChaseAnd then you're stuck on a solar pathway. Yes.David RobertsInteresting. Yeah. So that was my next question. What do we make of the fact that — because as Bloomberg NEF, their latest big forecast shows that — we're actually on track to build as much PV as we need under a net zero by 2050 scenario. We're actually on track ahead of schedule, even mildly on PV, but behind on wind. And I sort of have been wondering, there's two ways you could interpret that. One is we've overshot on public policy supporting solar, we're overdoing solar, we're making a mistake basically, and we will regret this later. The other way to look at it is just solar is doing what it keeps doing over and over again, which is doing more than we think it can do and solving more than we think it can solve.And eventually, just like sheer bulk, sheer low cost is going to overwhelm these intermittency problems. And in the end, solar will just be a bigger role in the final mix than we have forecast. That solar is going to beat our forecasts again, that solar is telling us that it can do it, rather than we're making a mistake. Do you see what I mean? Which of those do you come down on there?Jenny ChaseI'm going to be really disappointing and say it's a regional story. I think we're underestimating the impact of solar in sunny places. I think solar in sunny places can absolutely go along with it. Build some transmission, build some batteries, it'll all be good. I think for places like Northern Europe, we really should be building some wind and probably, to be honest, and nuclear as well.David RobertsWhy aren't we, why are we out of balance in those places? Why is PV doing so well and those other things aren't?Jenny ChaseSo nuclear is hard. It's not popular, it's big projects. Nobody really wants to take the risk. It's not cheap. There are many reasons why it's hard to build nuclear and it will really require government determination to get nuclear built and probably not be particularly popular, but that may be changing a little bit.David RobertsThat I get. Wind is a little bit more of a mystery to me though. Why that's — ?Jenny ChaseYeah, wind is more difficult than solar, especially offshore wind, because you've got to do a more difficult thing than building a solar plant and you've got to do it out in the ocean and it's got moving parts and things. Also, because the individual projects are so big and things like the cost of steel impact it. So, I think a lot of the issues recently have been that someone's agreed to build a wind project and then found that they couldn't do it at the cost expected and that has caused the contracts to be canceled, companies to pull out. It's all been a bit rough lately. And then for onshore wind, there's just often a permitting issue that some of the, they're called easements,the amount of space you've got to leave between the wind turbine and something else is probably further than it needs to be.David RobertsWould you take that to mean if you were talking to national policymakers, that they should dial back on support for PV or just dial up support for wind?Jenny ChaseI mean, if I was a policymaker, I would probably be dialing back support for PV.David RobertsWould you? Interesting.Jenny ChaseI mean, depending on which one I was, if I had none, I might not be, but I'm not sure I would bring in extra support for PV right now. But also it saved our bacon. I mean, last year, in 2022, in the energy crisis, PV and wind, but also new PV, saved our bacon.David RobertsYeah, it's a really underappreciated story, too. I feel like somehow out of that episode, the powers that be somehow took the lesson "we need more gas from different places." But that doesn't seem to be like what the lesson they should have learned?Jenny ChaseWell, last year we did because there were so many uncertainties and last year could have 2022, the energy crisis could have gone so much worse for Europe if we'd had bad weather. Bad weather is a big one because if it gets cold, then gas demand would have gone right up. And of course, what Europe does is buys gas all summer to fill up its reserves for the winter. So you have to be making accurate projections some way in advance. And in the end, demand destruction was much more than expected as well. So high prices meant lower demand apparently.David RobertsThat's another lesson I feel like we learn over and over again and can't seem to make it stick in our heads, is that demand is much more — I've seen academic papers on this — you can get much more out of demand in emergency situations than people think.Jenny ChaseSometimes you can and sometimes you can't. That's the frustrating thing. And sometimes it takes an emergency situation to get that out. I mean, I think maybe Europeans are maybe a bit fatigued now with the whole saving electricity thing.David RobertsI've kept you long enough. As a final sort of looking ahead, if I read your book and I take just what you've said here today into account, I'm going to guess when I think about what's next for solar, it's not going to be any weird exotic offshoot, or twist, or brand new use, or brand new placement, or brand new technology. It's just going to be more and more and more of what we've got. Is there anything when you look ahead to the next five years of solar, do you just see more, more and more? Are there potential surprises?I mean, obviously them being surprises you don't know in advance.Jenny ChaseBut that's the problem. Everyone's like, "what are the things you've not predicted?" I don't know if I could predict them, I would predict them. But I think higher volumes, lower prices, more or less the same tech.David RobertsSame thing that's been happening then?Jenny ChaseWave of bankruptcy is probably coming.David RobertsAnd that's in manufacturers or installers or residential installers.Jenny ChaseManufacturing, installers. Installers tend to go bankrupt after a boom. And there's been a bit of a boom in Europe. I think there's a little bit of a hangover in some markets and maybe some — nobody ever notices when installers go bankrupt, though, it's one of the problems with a very fragmented sector.David RobertsIf it's really been commoditized, which is, I think, sort of kind of the theme coming out of this whole area for years now. If we've really settled on a commoditized, basically standardized form of PV, isn't it the case that most commodity markets consolidate over time? There's going to be a few big players? Do you expect that to happen?Jenny ChaseI don't know. The installation end is more like plumbing. And if you have a good plumber, then keep their number and give it to your friends. I think that locally skilled work people will never quite be a commodity.David RobertsRight. But in the manufacturing, on the manufacturing side.Jenny ChaseOn the manufacturing, that's a commodity, and that is vicious.David RobertsYeah. It doesn't sound like after reading your book, I'm like, "why would anyone want to go into this business?"Jenny ChaseI know. I mean the U.S. is like, "oh, we should make our own modules." And I'm thinking, why? Horrible business.David RobertsThere's low margin, frequent bankruptcies. Yeah, well, we'll see how it plays out. Thank you so much, Jenny. And I will just say again that the book was so approachable and readable and interesting, and even I learned I mean, this is like, as you say at the beginning of the book, this is the book I wish I'd had at the beginning. I agree with that completely. Like, if you're just getting into this whole area, it's just such a nice plain language introduction to the various aspects of it, all of which I think are less — they seem complex and daunting because of the terminology and jargon that surrounds them.But I think your book makes plain, like, there's nothing in here that you need a PhD in engineering to understand. These are all relatively simple concepts if someone just lays them out for you. So I appreciate your book and your threads.Jenny ChaseThank you so much. And I appreciate the work you do on your podcast explaining a wide variety of things I had no idea about.David RobertsAll right. All right, have a good one, Jenny. Thanks so much.Jenny ChaseHave a good one. Bye. Thank you.David RobertsThank you for listening to the Volts podcast. It is ad-free, powered entirely by listeners like you. If you value conversations like this, please consider becoming a paid Volts subscriber at volts.wtf. Yes, that's volts.wtf. So that I can continue doing this work. Thank you so much and I'll see you next time. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Astrid Atkinson, co-founder of Camus Energy, talks about her company’s “grid orchestration” work of helping utilities see, track, and coordinate the distributed energy resources in their territories.(PDF transcript)(Active transcript)Text transcript:David RobertsOne of my favorite things I ever wrote was a 2018 piece for Vox on grid architecture — the basic structure of the electricity transmission and distribution networks. It was about how a top-down system, with one-way power delivery from big power plants to passive consumers, might evolve into a bottom-up system, driven by local distributed energy resources. Thanks to all-star illustrator Javier Zarracina, it even has awesome animated illustrations. One person who read that piece was Astrid Atkinson, who at the time was a senior software engineer at Google. She had managed a team that shifted Google search from a top-down system to a massively distributed system, back before the term “the cloud” existed and there was no template available. She and her team had to develop the principles and best practices of getting reliable performance out of millions of unreliable, loosely coordinated machines. By doing so, they radically expanded the scale and speed of what search could do.She thought, wouldn’t it be cool if the power grid could make the same shift? Unlike some people, though, she didn’t just blog about it — in 2019, she left Google to co-found and run Camus Energy, a software company that helps utilities see, track, and coordinate the distributed energy resources in their territories. The company calls what it does “grid orchestration.”Atkinson has been a thought leader in pushing for a new grid architecture. (See Camus’ white-paper series on “the rise of local grid management.”) So I was super-excited to geek out with her on this stuff. We talked about the conceptual shift from centralized to distributed and the drivers making that shift inevitable, plus getting more out of the grid we’ve already built through coordination and efficiency, and how the utility sector can evolve to better manage local resources. I really loved this one.Okay, then. Astrid Atkinson. Welcome to Volts. Thank you so much for coming.Astrid AtkinsonThank you so much. I'm really excited to be here.David RobertsI'm so excited for this. Astrid, I have to tell you just by way of preface that I had a weirdly difficult time preparing for today's pod because I'm just so excited by this whole area, and I'm so jazzed. I have so many things to ask you about, so many things I want to say about all this stuff, and I'm kind of overwhelmed and fried my circuits. But let's start here: Let me describe for listeners what you did at Google and tell me if this is an accurate description. So you were part of a team, I think, leading a team that was shifting the way Google did things away from a model where computing was done on a relatively limited set of high-quality, extremely reliable data centers, tightly centrally controlled, to a model where computing is done not on a small set, but on thousands, millions of distributed computers living all over the place, any one of which might be unreliably connected or off periodically or weak or otherwise glitchy.So basically, moving from a model of tightly coordinated, central control, limited number of entities, to loosely coordinated millions of entities, somehow getting aggregate reliability out of massively distributed, individually unreliable machines. Is that more or less accurate?Astrid AtkinsonYeah, that's about right. So my role was in the site reliability engineering team at Google, which is a function that nobody's ever heard of outside of the kind of tech industry. But you can think of reliability engineering as being basically Google's systems engineering function. It's the entity that's kind of responsible for pulling all of the pieces together between sort of software and operations and networking and hardware and everything, and making sure that you can get them to kind of work as a reliable system overall. And I was part of the original team that kind of — it wasn't a function that existed in the industry before Google made that transition.I was part of that original team at Google and then led a lot of Google's work around scaling out that model.David RobertsAnd so now the idea, more or less is to oversee or encourage a parallel evolution of the electricity grid, basically, from a limited number of tightly centrally controlled entities to a loosely coordinated, massively distributed, huge number of smaller entities, basically.Astrid AtkinsonYeah, I mean, that's definitely the hope. And that's partly derived from the utility industry and the grid space's sense of the changes that are needed and also partly derived from my sense that there are a fair number of parallels between some of the approaches that we took and kind of had to make up on the spot to support massive growth and really significant changes in the way that we managed systems for that work at Google. And there are parallels with the changes that we need to go through on the grid side. So it's less like "there's this one piece of technology that we built at Google that will totally solve the problems" and more like "we had to develop a set of approaches and a set of kind of integrative and system level perspectives to figure out how to make that change happen."And I think a lot of those can be helpful in the grid space.David RobertsYeah, I mean, I think one of the most intriguing things about this is in doing that work, you extracted a set of principles for how to design systems like this such that they are reliable, et cetera. And it's those principles, I think it's like conceptually those principles apply to the grid. Obviously, the individual technologies might be different, circumstances are different, but the principles of how to make it work, I think are a weirdly neat fit. The reason I think we should maybe pull out, the reason that this is not something that the utility really can choose to do or not to do.Utilities kind of have to do it for a couple of reasons. One is all these distributed energy resources, Volts listeners are familiar with these distributed — with these solar panels and hot water heaters that can store energy and batteries, et cetera, et cetera. All these sort of behind the meter distribution side, distributed resources are coming online. Whether the utilities like it or not, they are swarming —Astrid AtkinsonIt's happening.David Robertsonline, it's happening. And right now utilities are just like kind of hoping it works out, we'll get into that. That's one reason. But the other reason is we're expecting, like you could say of Google, like it couldn't have scaled to the size it got, it couldn't do the amount of computing it's doing without going through this transition.You just can't at a certain point with a centrally controlled system where you're tightly controlling a limited set of entities, you just can't get big beyond a certain level. You run into sort of computational limits of your computational resources for a central controller. And we're expecting a lot more out of the electricity system in coming years, as Volts listeners are also very familiar with. We're going to two or three x the demand that it has to satisfy in a much more complex way. So I think it could be argued, and you have argued, and I think it's pretty self-evident, that the electricity system cannot achieve the scale we want out of it without going through this evolution.There's just no way for the way it's currently run to get as big as we want it to get.Astrid AtkinsonYeah, and if you want some simple examples of why that is, utilities have spent a lot of money and a lot of time in the last 10 to 15 years installing smart meters. Right? They were supposed to give us the kind of universal visibility into customer activity that I think we can all intuitively think that we would need to manage a rapidly changing grid with a lot more complexity. But most utilities don't really have particularly high-scaled data infrastructure. And so the idea of actually being able to do something useful with all of that meter data, SCADA data, kind of everything at scale on an ongoing basis in real time, using that as a foundation for analysis and visibility and those kinds of things.It's really hard for them because usually the software systems that gather and process that data, they're on premise within the utility's own data center. They're typically not really using any kind of modern scalability approaches beyond downsampling the data, which means losing some of it. And they're usually running on a single machine. So it gets really difficult to incorporate very large amounts of data when you can only use one computer.David RobertsYeah, if you talk to them, they're like, "Oh my God, we've got all this data. It's overwhelming. The reason we're not doing more with it is like, we can't do more with it, we're overwhelmed." And then you look at the scale of data involved, and to a Google it's a tiny amount of data. The scales are completely different.Astrid AtkinsonYeah. Just as a back-of-the-envelope calculation, I was trying to figure out how many data points do Google's monitoring systems collect on a daily basis? And it should be somewhere in the order of 6 to 10 trillion.David RobertsGood God. That's like whatever atoms in the universe. I don't know what the right comparison is.Astrid AtkinsonGoogle is where I learned the term exabyte. They sort of just came into this with a perspective on scale that was sort of orders of magnitude larger. And you don't really think about the amount of computing work that's required to get you the right answer in under a second to any question that you might have through search, but the short answer is hundreds of thousands of computers all at once.David RobertsRight.Astrid AtkinsonYou can just do more.David RobertsRight. And so the current way utilities are running this with sort of a single machine on premises chewing through this data serially is just not going to get anywhere close to that scale.Astrid AtkinsonYeah, and to be fair, they'll scale up to five or ten machines. But the systems that we had to build to kind of manage the Google scale tech computing, they weren't five to ten machines, they were 50 to 500,000 machines.David RobertsRight. Which you're not going to do on premises. You have to basically move to the cloud to widely distributed resources. So, Astrid, all this sort of preface, conceptual preface, is so my jam. You probably know this because I wrote a big article about grid architecture a few years ago.Astrid AtkinsonYes. And that article, if you're talking about the one from 2018, was really influential in how we started thinking about the space a little bit before starting the company.David RobertsI mean, that was literally my dream, writing that article, is that some smart person who understands how this works with computers will come over to the utility industry and bring it to the electricity system. Literally. Like, you're the answer to my prayer. But what you may not know is that this is my jam going even way farther back, like back in the midst of time, back in the midst of prehistory. I was getting a philosophy degree, I was working on a PhD in philosophy, and my whole thing was studying cognitive science and consciousness and sort of cognition and how cognition works.And one of the things I was deep into is this shift of people describing cognition as distributed and describing the human identity as distributed. Sort of this illusion of a unity that actually comes out of massively distributed, relatively dumb nodes coordinating to produce this emergent behavior that we call consciousness. So the whole idea of moving from centralized to distributed, that was in my bones even as far back as grad school. So now it's like popping up all over the world. These are really just thrilling times for me personally, I guess, is what I'm saying. It's so cool to see all this stuff come together.So one of the things you say in your presentations and such is the first — step one, if you want to do this, if you want to coordinate massive numbers of nodes to get a desired set of behaviors as an outcome, the very first thing you need is knowledge of the nodes. You need to know what's out there and what it's doing and what its capacity is. And in the computer world, we have the system on the Internet, we have the system of IP addresses, an individual address for every single computer that's connected to the Internet. And there are, as we say, millions and millions of them.So right there, it seems like right there, your attempt to pull this over into electricity looks like it grounds out because we just don't have that. Like when I hook a water heater up to the grid, I don't think it gets an individual identifier, does it? Or a solar panel, or an EV battery or EV charger, et cetera, et cetera. This is the whole problem, right, is all these devices are hooking up to the grid and utilities don't know where they are or what they're doing or when they're going to do what they're doing. And I can't — have trouble imagining a system that would individually identify them.So right there, right off the bat, how do you overcome this first and most difficult problem? Because as you say in one of your presentations, the pyramid, you show the pyramid of reliability. And the base level, the bottom, the level upon which the rest of the levels are built is monitoring. You have to know what's going on out there on the edge of your network. And in electricity we don't. So how the heck do we overcome that problem to even get to the other problems?Astrid AtkinsonYeah, so there's really, from a technical perspective, kind of two questions buried in the one that you just asked. One is about addressing. And it's true that we don't really have an IP address system for the grid. But the reason that we need that for the Internet is that we ultimately need each individual piece of work to end up at a specific location. Like an email needs to end up at a certain address or a DNS query needs to go to a certain server in order to get a response. Whereas in the electrical system, we're really sort of thinking more generally about managing need for work to ability to do work.So, managing supply to demand, it doesn't really matter which particular electron serves the need. One of the primary goals is just that there are always exactly the right number, always exactly the right amount. So the problem space is a little bit different in that perspective. It doesn't mean we don't need to know what's on the grid and where it is. But you don't have quite the same need for an absolutely universal addressing system. Just as an example: One of the ways that one could tackle this is there's a bunch of really interesting work happening in the grid management and grid architecture space in Australia, which I'd love to talk about a little bit more when we get further through this.But as part of that, they basically extended a universal identifier system that applies both to meters for one set of identifiers and then to generators for another set. And that's just kind of the country deciding to do things a certain way. And it definitely, I think, can be a helpful enabler to have that. In the absence of that, you can correlate it across multiple sources because within any given utility, they do actually have a way to identify specific assets. Typically that's something associated with the meter number. So it's usually like a site identity or like a site number or something like that that identifies a particular customer location that associates with a billing relationship and associates usually with a specific physical meter and is like kind of the identity component that ties those things together.David RobertsRight, but isn't the problem that behind any one of those meters might be multiple devices that behave very differently and have very different timing and etc.?Astrid AtkinsonYes, and should you want to be able to tie together the activity of those devices with the utilities identification mechanism, you're going to need to write some software. So one could do this today by basically just like writing software to link together the program identifier or the device asset identifier. Let's say you're talking to ChargePoint chargers. You can get like a ChargePoint charger ID, and with a modest amount of software, you can link that together with a meter ID. It's all kind of a pain in the ass, but it's doable.David RobertsWould it not be easier with something like an IP system, though? I mean, is there any talk about is that a gleam in anyone's eye?Astrid AtkinsonYeah, I do like the Australian model, I think they call it. It's like a distributed generation ID and then there's like a meter ID. It's basically just an agreement that those things are going to be unique across multiple systems. I think one of the sorts of things that could be easily extracted as an example and it certainly would help. I think there's a lot you can do without it, but it would help. The other thing that's kind of buried in your question, though, is "how can we see what's out there and know what's happening?" And when we talk about monitoring in the Internet space, as you mentioned from my diagram, which is actually drawn by a former colleague of mine, Mikey Dickerson, who went to go lead up — I don't know if you remember, but the healthcare.gov rescue team under the Obama administration.David RobertsHeroes.Astrid AtkinsonMikey was a colleague of mine at Google, and he went to go lead up that rescue effort. And so the diagram you're mentioning, which is a lovely one. It's just like a little pyramid of — kind of like Maslow's pyramid of needs, but for reliable computing — it does have monitoring and system visibility as its foundation. And what that looks like in the Internet computing space is that for every systems component, whether you're talking about an individual server or a network router or a piece of software or whatever that's operating within the construct of a larger system, you kind of want to know what it's doing.That's why Google collects so many data points for their systems, because they have quite a lot of them. But this is common across the entire modern computing industry. If you're running a large system, you would typically have a monitoring system that would pick up ongoing telemetry, so like heartbeat information and activity information from literally every component and then assemble that. Firstly store that data and then assemble it into some operator friendly dashboards and ways to keep an eye on what the system is doing. We don't really have that, particularly the distribution grid today. We do have it on the transmission side, but that's not really how the distribution grid rolls at the moment.David RobertsYeah, and so absent a system like that being put into place with unique identifiers for every little piece, ultimately it seems like you're in the end modeling, basically estimating on some level, are you not?Astrid AtkinsonIt's a mix usually. So in practice what that looks like is you do end up with unique identifiers for those assets because if you're bringing in a data stream from an EV charger or a battery or a solar inverter or something like that, you want to know which one it comes from. So in the absence of like a universal addressing scheme, the way that we would do that from a technical perspective is we'd say we've correlated this battery with this site ID, so its identity is now site-id.battery or something like that in our database. So you're actually creating that notion of identity to do that.And then we're pulling in data, or whoever is pulling in data from ideally every one of those things. Now those things are all exporting data all the time anyway. Like their vendors, their installers are always installing them along with some kind of remote monitoring capability.David RobertsRight. Just not to the utility.Astrid AtkinsonNo. And as mentioned, partly that's because the utility in general is not very good at dealing with very large amounts of data, but it's also because that's a lot of vendors to talk to and a lot of devices to talk to.David RobertsYes, and I would imagine a lot of different data formats and it must be a mess of information.Astrid AtkinsonThis is where the modeling stuff comes in because in general, there's lots of data available, but it's almost never universal, it's almost never consistent across every utility or device type or whatever. Sometimes you'll have utilities that have smart meters with 20% of their customers, but not the others. Or you might have ones where they have meters that give you a monthly read for most customers and then a small subset that can give you more frequent data. You might have utilities that know where all their rooftop solar is and have even production meters that tell you what it's doing, but most have an interconnection record that's kind of separate from any other data set.Maybe it's in their GIS. And most don't have a production meter to tell you what's happening there. And so if you want to make sense of all of that, you do need to use a fair bit of modeling so that can be from everything. Like this meter data has a bunch of drops where the network dropped out and I need to fill it in so that the time series is complete to like the meter data has a different frequency, like it's sampled every 15 minutes and SCADA data is sampled every minute and I want to compare them.So now, I need to fill in minutely data points using a model. Or it might be I want to have some idea of what rooftop solar is up to, but I don't have any production meters. I do know where there are rooftop solar installations on my system though. And we do have modeling tools that can do a forecast for rooftop solar. So then, what you can do is forecast the likely output of a panel that's yay big at location X, match that against the data that you actually have from the meter, and then form more complex and more complete machine learning models, which can then give you a model-based view of what's probably happening.David RobertsRight. So this is where the machine learning and the AI comes in.Astrid AtkinsonThat's right.David RobertsTaking the data you do have and extrapolating to a more complete —Astrid AtkinsonAbsolutely, and that's really valuable, not just for things like forecasting, which is kind of the most common use case for it, but it's also useful for understanding what might be happening right now because most utilities don't really have great visibility in real time. To anything that's sort of below the substation or feeder circuit or maybe they have reclosers or something on the line but they don't really have any visibility at the distribution transformer or at the meter that is anything like real time. Meter data usually trails by between 2 and 48 hours.David RobertsAs I was reading about this and thinking about this, my mind kept bumping up against one thing, which is that a model like this in, I don't know, like global shipping of goods, where maybe you lack certain information sets and you're deriving them from other information and making a model. A sort of like extremely educated guess. And you get close enough for government work, you get close enough to make the thing work. But in electricity systems, you really got to get it exactly right. Like the supply and demand have to be exactly matched at every second. Can you get from the limited data we have now, add a bunch of machine learning and AI to derive a global picture of what's happening? Is that global picture going to be accurate enough to meet the sort of reliability standards we require of electricity specifically? Like people are not very forgiving if you have little gaps.Astrid AtkinsonSo the key question is "reliable enough." Is it going to be perfectly reliable? Absolutely not. And for high fidelity low latency applications, you need high fidelity low latency data. But a lot of our applications are not high fidelity and low latency. And so there's a lot to unpack in terms of how much data you need for particular use cases. But broadly speaking, for things like maintaining frequency of the bulk system, that's something that needs to be done on like a subsecond basis. Obviously, it's kind of a 60 Hz basis, but we have that visibility on the transmission system, and we have transmission operators whose job it is to maintain that frequency.So if you don't have that kind of fidelity on the distribution side, that's not necessarily going to impact stability from a frequency maintenance perspective, especially if you do have fast response assets like batteries and stuff like that, that the transmission operator can call on to provide services. And there the distribution operator, even if it's distribution connected, doesn't really need to know about that as long as somebody knows that they need it and can call on it. So when we think about what we need in terms of data completeness on the distribution side, it kind of depends on the use cases, right? If we want to be able to just use flexible load to move our peak usage around so that you're not running up huge demand charge bills on behalf of the utility at peak usage times in the evening, you don't really need real-time data for that.You can just kind of move it around on a day ahead basis, right? If you want to be able to manage, let's say you've got a house with five powerwalls and you want to make sure that when you charge those powerwalls, they don't blow up the transformer that house is connected to. That's also something that benefits from more real-time data, but doesn't strictly require it because you can just kind of put a bit of a margin for error on your calculation of transformer capacity and make sure you operate within it. What you lose is a lot of additional efficiency and the more you want to actually use that active management to manage reliability and grid capacity conditions, the more you do really need the actual real-time data.But it can be a process. It doesn't have to be perfect from day one.David RobertsRight. I mean, a lot of this is just about how to get started with the crappy systems we have in front of us. I'm sort of like —Astrid AtkinsonI like to refer to it as real world data.David RobertsRight, which anyone who's dealt with the real world knows is generally pretty crappy. So what's the sort of balance of efforts of trying to organize people to produce more data on these things, right. Or harmonize data, or come up with some sort of harmonized transferable, mutually communicatable data systems versus effort put into the machine learning and AI that can make hay out of existing data? Does that make sense? Are you just running with the data you got? Or are there also efforts underway to produce better data or to harmonize data across all these systems?Astrid AtkinsonYeah, there's really both. So there's a bunch of really good work that's happening in the industry to try to get much higher fidelity data collection and reporting at either the meter or an equivalent kind of customer side component. So companies like Sense do this, SPAN panels can do this. The meter manufacturers are all working on it.David RobertsAre the smart meters that got installed in that first wave of smart meter installs, are they useful for this? Like, are they producing good data for this kind?Astrid AtkinsonThe real issue with smart meters, especially in the US, at least from my perspective, is not actually the meters themselves: They collect data every 15 minutes, which is pretty sparse in general —David RobertsSmart meters do?Astrid AtkinsonYeah, sometimes. Often it's every hour and sometimes it's every month.David RobertsThat's not super smart.Astrid AtkinsonIt's not very fast. No. And a lot of times it really has to do with the amount of data that the head end system, which is like the software system that picks up the data, can bring back. It also has to do with the bandwidth of the network that's available to the meter to bring data back to the meter as well. So in general, we collect and store a lot less data than we could. And a lot of that has to do with limitations of the communications network and of — not enough computers to bring in the data.David RobertsSo you could theoretically get more out of those in the future if you built up the infrastructure.Astrid AtkinsonYes. The big issue with the data collection from smart meters today, from my perspective, is that most of them in the US communicate via an RF mesh network, which basically uses kind of a — I don't know, you could think of it as like a bucket brigade for data. It's like kind of tossing from one meter to a repeater to an upline repeater, to an upline repeater. And God knows what it's doing out there on the network, but it takes like often 6 hours to get a message back. I like to picture the data, like, having a little picnic out there on the line because it's very slow.David RobertsIt's like The Hobbit. It's like trudging through fields and over mountains.Astrid AtkinsonYeah, and most of those systems will let you get a single point read from a single meter more quickly. But if you wanted universal, somewhat real-time visibility into what's happening at every meter today, for anyone who has those systems, the only way to get that is to forecast it. And so that's where you're really sort of looking at the role of real-time forecasting to try to fill that gap. Now, the issue with getting more instrumentation out there or even getting those kinds of technologies in place isn't really a technical one. It's more that most utilities have never had it and they haven't really felt a need for it.Right.David RobertsLike, moving around large amounts of data is a solved problem, let's say technologically.Astrid AtkinsonIt is something that we have great technologies for.David RobertsBut they're just not using it. And just as a general comment — and this is something I'd say frequently — I feel like ordinary people who are out there very familiar with tech and the Internet and all that kind of stuff would be surprised if they knew how comparatively low tech the grid is compared to the systems that they're using day to day life. It's wild that there are still people finding out about outages by getting a phone call from Bob, who's walking his dog, and that causes Jerry to have to go throw a physical switch somewhere. Like, the whole thing just seems incredibly like the more you learn about it, you're like, still in 2023?I don't know if this was your impression when you started getting into it.Astrid AtkinsonI remember going to do a tour at San Diego Gas and Electric for their operations center not that long after starting the company. And the difference between data fidelity and kind of amount of real-time operations on the transmission side versus the distribution side is pretty shocking. The transmission side is everything you'd expect. Right. I remember when we did that tour, they walked us into a conference room, gave us a little advanced talk, and then flipped a switch and the entire frosted glass wall of the conference room went transparent. And you could see their transmission operations room with their gigantic screens and all these operators in their little consoles with each one has half a dozen computers around them and it looks really high tech.You go over to the distribution side and it's like a bunch of desks people maybe have two monitors, and it's mostly people taking calls and making calls to roll trucks to fix outages. We have the technology. We even have it in the grid. We just need to scale it.David RobertsYeah. Distribution systems basically have been neglected and badly need now to be beefed up in a number of different ways because of the aforementioned flood of DERs coming.Astrid AtkinsonYeah, and if I can mention one of the parallels with my past life doing operations at Google, because part of my job was actually like on-call operations. I led the team that was responsible for Google's homepage for about five years. So you went to Google.com to see if your Internet was on between 2007 and 2012. That was my team and I carried a pager myself for it. One of our big strategic efforts as we were doing that work was really thinking critically about building tools to help operators understand system scale. So if you think about not only a very large system, but also one that's undergoing constant change, where there might be dozens or hundreds or thousands or tens of thousands of individual systems interacting, changes are happening all the time that you don't know about.And that's true even in a Google type environment where you'd think it would be all coordinated. But Google has like 100,000 software engineers. It might be 200,000 by now. And good God, they can generate new things quickly. And so from the operations side, one of your big challenges is making sure that what's happening within that changing system is comprehensible to a small group of people.David RobertsYes. Can't change human bandwidth.Astrid AtkinsonThat's right. And so one of our kind of core philosophies about that was we wanted to have tooling that would let us support exponential growth in the system with sublinear growth of the operations workforce required to support it.David RobertsRight.Astrid AtkinsonAnd so that means you're making a lot of ongoing investments in tooling and stuff like that. But it also means that that technology investment is a fundamental part of how you scale the system and that operations function is kind of intrinsically tied to how and whether you can scale the system. So, you know, when I saw that room at San Diego Gas and Electric of their distribution operators working really hard to manage the complexity of the system that they have, I kind of look at that from a systems engineering perspective and kind of a large systems perspective.And just think, like, wow, making sure that those folks have the tools that they need to understand what's happening as we go through all these changes. That's actually really close to the heart of the problem.David RobertsYeah. And is there an industry doing that? Do the utilities just cook all that stuff in house? Where are the 100,000 engineers that are helping utilities?Astrid AtkinsonWell, I have a company of about 30, so we're short a few. No, there are people, of course, across the industry that are working on this. And that's typically a mix though, of the existing kind of large scale vendors and folks within the utility trying to kind of roll their own, which is good in the sense that they know the problem space, but bad in the sense that very large scale, real-time operations, cloud computing is sort of a specialty that doesn't have a lot of overlap, necessarily with utility systems training. So we could use a lot more person power on this problem, for sure.David RobertsSo the point of all this, and this is a point I thought you made it really well in one of your talks is one way we could deal with the growth in demand that we know is coming is just to build more and more grid. But building grid is hard. There are NIMBY problems and capacity problems, money problems. And our ability to build out physical grid is rapidly going to be outstripped by rising demand. So our only real alternative here is to make more use of the grid we've got, is to use the grid we've got more efficiently.And basically what that means is coordinating the behavior of all of these millions of distributed devices so that they work in concert with generation and everything works in a big happy system together. But right now, I think Volts listeners will be familiar with crude proto versions of this, like demand response systems where the aforementioned phone calls are like someone calls you and says, "hey, will you not run your boiler on x hours of x day?" And they're like, "okay," so that's a form of coordination of those machines. But I think anyone can tell with a little bit of thinking that that's not going to scale up to millions of them.So the key here, the heart of all this is beginning to automate these things is to beginning to automate the behavior of these thousands and millions of distributed devices. And so here again, I think your experience in Google transfers pretty well since automating tasks, automating work, work routines, and subroutines is kind of at the heart of what you're doing. So talk a little bit about the hierarchy of work and the ladder of automation.Astrid AtkinsonYeah, so there are a couple of things in that. First, I guess it's maybe helpful to have a concrete example of what that looks like at Google. So one of the things that we went through at Google was reaching a point where the global load distribution system, which manages all data center traffic, was needing to be adapted to manage really rapid growth in demand for network bandwidth. And so before that, we were really just kind of moving search requests around across a set of global data centers. And that has its own constraints. You need to be able to move that traffic quickly.You need to be able to respect capacity constraints. You don't necessarily blow up substations if you get it wrong, but you actually can overload and crash servers. And it has a lot of analogs to the grid system in the sense that once you overload servers, you can cause cascade failures that will take down service globally. So there are consequences to getting that wrong even when it's just search traffic.David RobertsTo put it in electricity terms that the audience will be very familiar with, you're just trying to avoid peaks in computing load. Basically, you're trying to make the demand for computing look like a nice smooth line, even though there's tons going on beneath that line. If you can coordinate it all just right, you get a nice smooth line. And spikes, because you have to build, as you point out in your papers, any network is built to the size of its tallest peak.Astrid AtkinsonThat's exactly right.David RobertsSo the more you can smooth out those peaks, the more you can grow the whole thing without demanding more infrastructure. And that just transfers very straightforwardly to electricity. You're trying to move load demand around and coordinate it, such as to create a nice smooth demand line.Astrid AtkinsonYeah, that's exactly right. And that's kind of the fundamental capacity planning constraint for any large-scale system like that is really what's your peak demand and can you absolutely meet it, or do you have a way to shed some of that demand if you're going to cause system problems? Right, so when we transitioned to needing to be able to scale the use of network bandwidth, it was when Google bought YouTube and we needed to be able to serve lots of cat videos. We started to think about not necessarily taking every user request all the way from Azerbaijan to a data center in California, but rather could you put capacity out in Azerbaijan to serve the most popular Azerbaijani cat videos?And so we went through this really big transition of how we manage the network towards much more distributed capacity management and also software-based network automation. So really moving towards software-based management of where and how peaks occur, because you're exactly right. And then also trying to move as much work as possible to the edges of the network so that you could get more work done on the network as a whole. So the parallel in the energy system is moving as much work as possible, as close to the user as possible. So that's moving it to distribution, connected resources, and to DERs.And what that gets you is a bunch of tools for optimizing your network capacity, which, if we want to get our grid to do more without building four times as much of it, is really what we need to do now. So thinking about like, okay, what's the set of technologies that makes that kind of transition possible? If you need 10,000 times more capacity from an existing network, or let's just say like ten times more, or even four times more, which is probably about what we're going to need, you need some tools to be able to handle that. So firstly, the more of that work you can do close to the source, the more network you have to work with.Secondly, understanding what the network constraints are in a really nuanced way, and also what the need for capacity and the available supply to meet that is in a really nuanced way. The monitoring piece, like what's out there? What's available not just for the system as a whole, but on my street or your street or my substation, is a really important part of that. And then the analog to what we did at Google, which was to put caching, which is basically computers that store information close to the user. So we'd like preload the cat videos that are most popular near your house is basically storage in the grid.Right. And what that gave us was the ability to do some work locally, which increases the reliability of the system as a whole, because you don't have to have the whole network between Azerbaijan and California working perfectly all the time. A lot of times you can just do the work locally. But it also gave us a lot more flexibility around being able to handle really extreme variations in load because you could have some of that load soaked up locally, you could potentially shed a little bit of it, you could potentially move it around to other assets that could soak it up somewhere else.And so when I think about that from a grid perspective, the sorts of changes that would support that, they're not huge. We need a better sense of what's going on. We need more control over load showing up, when and how it shows up. And ideally, the ability to smooth out peaks and some reasonably large amount of storage distributed broadly across the grid to like, substation or lower would give us a lot of flexibility in how we manage that system. So if we're not exactly right about exactly how much the planned demand is going to show up, you can just kind of soak it up with local storage and not have to worry about it too much.David RobertsGet you a little buffer there.Astrid AtkinsonYeah.David RobertsSo the equivalent here is if I need an electron to run my toaster and the grid can be coordinated, such as to provide that electron from my neighbor's solar panel, let's say. You're using the minimal amount of the network and leaving as much of the network possible open for other things, basically, like you're minimizing total network load work.Astrid AtkinsonAbsolutely. And to some degree, you do that already, right. Like, let's say that your neighbor, like me, has an oversized solar panel, I have 9 kW on my garage. During the day a lot of times I'm back feeding into the system, so I'm powering my neighbor's toaster. The reason that doesn't really get us very far in terms of saving money on grid upgrades or really contributing to the health of the system today is that all parts of the grid still need to be sized as if that didn't exist because we don't have any way to guarantee that the peaks don't show up.David RobertsRight. And this is the thing, is when you're building a network, if you've eliminated 99% of the peaks, you still got to build the network as big as the last remaining peak is.Astrid AtkinsonOr you need a last-ditch alternative to be able to shed that one remaining peak. There's a couple of different ways to do it, but yes.David RobertsThere's so much in here, but this gets to the grid architecture question that I was writing about back in 2018 with my cool diagrams. That my —Astrid AtkinsonThey were so cool.David RobertsI know. I've seen that you're using variations of them in your presentations and it makes me so happy.Astrid AtkinsonI'm glad it makes you happy because we thought that they were amazing and really explanatory and found them very inspiring.David RobertsThat's Javier at Vox. I'll put a link to that piece in the show notes. But basically, the idea here is that you go to the lowest level, the edge of the grid. Let's say the distribution node, a node on the distribution grid. The idea is you satisfy as much of the demands of that distribution node with resources within that distribution node. Net that out. So the only power that the distribution node is asking for from the transmission system is whatever is left over once it has subtracted its own supply from demand or demand from supply. And then you sort of move up levels.Right. So in a sense, everything is kind of a microgrid. It's like microgrids within microgrids within microgrids. I don't even know if that's the right terminology, but islands within islands within islands.Astrid AtkinsonYeah. You ultimately be looking at a system with multiple abstraction layers where some amount of management is done locally, and then those nodes are connected to the broader system, and then the broader system does its own coordination. But the thing that's really nice about that model is that you don't have to worry about your toaster from the California ISO.David RobertsExactly. There's someone in between the California ISO and me that's worrying about my toaster. Some entity or —Astrid AtkinsonThat's right, yeah. And technically, you could build a system that did kind of coordinate from the ISO to the toaster. But what you would lose in that kind of system that I think is really important is some amount of local abstraction layers and local management entities where you can optimize for different kinds of work. So optimizing for the temperature in my house is actually kind of different than optimizing for the load on my transformer and kind of different than optimizing for overall supply and demand for the state of California. It is reasonable to have those things handled by different layers, different entities, even.David RobertsRight. And there might be neighborhood goals or values or city goals or values that are slightly different than the state goals or values and so on. And also, just as a matter of computational complexity, I mean, this gets to what I was trying to get out of my article. It's one thing for these ISOs or RTOs — these sort of entities that are coordinating transmission grids — it's one thing when you're coordinating — call it like five big power plants in a couple of dozen distribution nodes. Right. As we were saying before, that's a finite number. You can control that more or less centrally.Astrid AtkinsonModel it deterministically.David RobertsYeah, you can model it deterministically. But once you're getting to thousands and millions of devices trying to coordinate all that at every level from a single point, from a single operator at the top. It just seems to me it's rapidly going to overwhelm their ability, their ability to — and why would you want to? It just doesn't make sense to have one giant regional organization coordinating your toaster, as you say. All of this brings us to the DSO model, which is I was delighted to find beloved by both of us.Astrid AtkinsonAbsolutely.David RobertsWhich is you need an entity — you know, we can discuss whether it has to be a singular entity, but let's just call it an entity for now. You need an entity at the distribution level, at the level of that distribution node that is responsible for coordinating the activities of all these DERs within that distribution node. Matching supply and demand, netting it out, determining how much power is needed by the distribution system. And then that node, that DSO, the distribution system operator, does that work. And then the only signal it needs to send up is a single signal, like we need x amount for our distribution node.Right. So it's taking all that complexity at the local level and simplifying it before it sends it upward, basically. And you have that at every level you're simplifying and sending upward. So that once you're at the top level, the ISO, you're dealing with a tractable number of signals rather than trying to talk to every toaster.Astrid AtkinsonYeah, definitely. And even for very large scale load balancing systems like the ones that we used at Google, they were still built that way. Right? It was like local coordination across work within a single data center that was then providing a simple interface to global coordination systems, which basically were like, "hey, how much load you got? How much load can you take?"David RobertsRight?Astrid AtkinsonAnd then would readjust allocations every second or two.David RobertsRight. So from the transmission operator's perspective, a distribution node will basically just be a single machine that either has a set amount of demand or can offer a set amount of supply.Astrid AtkinsonIt would ideally look a lot like battery does on the ISO system today, I think. Where you've got a certain amount of power, need a certain amount of flexibility available, perhaps a certain amount of power available. But I think something like that would be a small enough adjustment on top of how we think about managing at the transmission level today to be practical.David RobertsDo you? There's a large amount of reform —Astrid AtkinsonDon't get me wrong. There's definitely new software components, new data components, new business model components, all the above required to do this.David RobertsWell, it's the business part and the regulatory part that's baffling to me because that's the hardest, in my experience, the hardest part to get moving on. And right now, just to be clear with everyone, there is no such entity in the US. Basically, there's no entity responsible for handling the complexity at the local level, simplifying it and then sending the signal up. So we would have to create those out of parts. So I know Lorenzo Kristov, who I drew on to write that original piece, who's kind of the guru of all this stuff, I think has been beating his head against the wall in California, trying to get them to run DSO sort of test models or create test DSOs.So who out there is doing that? And what does the DSO model look like? Is it up and running and working anywhere or is it all experiments?Astrid AtkinsonYeah. So this is where I get to talk about Australia, as promised, because Australia has a really nice large scale demonstration of this type of model that they're actually pretty far into at this point. You know, like many regions, including the UK, a couple years ago, Australia sort of took a look at the oncoming challenges associated with DERs on the electrical system.David RobertsYeah. Swarming rooftop solar per some previous podcasts here, tons of rooftop solar. Way ahead of anybody else.Astrid AtkinsonAbsolutely. And so they were a little bit more motivated, maybe, than other places to try to solve this problem. And so there was a bunch of really interesting work led up there, mostly out of AEMO, but also out of the CSIRO and some of the universities and stuff as well. And I know what this is because I'm from Australia, but what they did was come up with a couple of kind of trial models of coordination between AEMO, which is the Australian market operator this is kind of the ISO, and the distribution network operators and the aggregators and retailers that were working within some of their key markets.And one really relevant example of this work was something called Project Edge, which you can Google, although you might need to, I don't know, add AEMO or something to it, just AEMO. And what that was doing was looking at a coordination model exactly like the one that you're describing. So it was asking the distribution network operator to take on more of a DSO role. It was asking the aggregators to provide data about the location of their devices, what they plan to do with them, those kinds of things. And AMO is playing a coordinator role to kind of sponsor that and bring some of the data together.But ultimately, it's a sort of joint function between those three parties. That's just one example of how this model could work. The UK is taking a little bit of a different approach with the central regulator and kind of central operator National Grid taking a bit more of a central role in that. But still, it's kind of looking at the idea of cutting up the system into multiple localized components and then having some entity take on a distribution system operator role to collect that data about the state of the grid and the things that are participating in it.Coordinate that with data from the aggregators and coordinate that with data about market participation. And in Australia, they liked the results of that so much that they are planning on rolling it out nationwide.David RobertsInteresting.Astrid AtkinsonWhich is an advantage of being a smaller country.David RobertsYou know, they've got so much rooftop solar now that they're having duck curve problems and even some stability problems, I think. So where they've tried this, they're solving that kind of duck curve-ish problem.Astrid AtkinsonYeah. So some of the early applications in Australia particularly focus on being able to curtail rooftop solar in places where they have basically oversupply issues. So it's a duck curve problem. Right. And just given the way that sort of social license and kind of public sentiment works in Australia, if you're curtailing somebody's solar, the Australian consumer citizen will kind of expect you to pay for that just as much as they would expect you to pay for the energy that they provided when it wasn't curtailed. And so they needed a market construct to support that. The other thing that is happening within that broader model that I think is really interesting is also the ability to do basically flexible interconnections.So being able to basically say you can connect this new load, EV bus charging is my favorite example, but only if you don't exceed a certain capacity allocation. So you can connect it and it's kind of up to you to manage that. And we will give you that capacity allocation either as a fixed allocation or even better as a dynamic allocation. And that idea of like a dynamic capacity allocation that a user has to stay within is called dynamic operating envelopes. And that's a sort of technical component of that Australian work that helps the system operator to manage basically the capacity allocation to every individual DER, consumer or producer.David RobertsRight. And this is where again, automation comes in because you're not going to get every bus charger operator to sit there with their hand on the lever, no pulling it up and down as these dynamic constraints change.Astrid AtkinsonYeah, this is a job for computers, this is not a job for humans.David RobertsSo there are DSO models out there happening. In the US, let's talk about the weird US situation. So in the US, recently, FERC issued this order is it 2222?Astrid AtkinsonYeah.David Roberts2222, which says aggregators — which just in case people are not familiar with these, that's just like a third party entity that strikes contracts with dozens or hundreds or thousands of DER owners to basically give them control over those DERs so that they can treat them as an aggregate, treat them as a big, giant generator, or treat them as a big, giant battery — and then FERC's order 2222 says those aggregators can play in wholesale energy markets, basically.So you can take an aggregation of DERs and pretend to be a power plant in the wholesale power market, basically, or act as though you are a power plant in the power plant market. And that's a response to the need for our system to make more of these DERs, to use these DERs rather than just be a victim of these DERs, to take some control of them and use them in such a way that they're useful. But to me, that just feels cludgy, feels like a half-ass solution. Because you have this weird thing where pretty soon, like I said, these wholesale markets, depending on how many aggregators you have, and I'm not sure totally how that market is going to shake out, but there could be a lot of them eventually. Again, you're just like, why have the one central coordination of all those machines?It just feels like that should be resolved, that the stuff among individual DERs should be resolved at the local level and not something for the ISO to have to be dealing with. And also, so you have sort of aggregators kind of speaking directly with the ISO, kind of bypassing any DSO. It's just a weird kind of hybrid model of localness and centrality, I guess. To me this seems like a temporary fix on the way to something better. How do you feel about 2222?Astrid AtkinsonI think it's definitely a key part of a solution. I actually really like 2222 for a little bit of a roundabout reason. What it does is mandate that aggregators should have access to wholesale markets. And it is entirely silent on the interaction of the DERs that they control with the network that they're actually located on on the distribution side, which is kind of bad in the sense that you really want to know probably what's happening with any assets that are moving a lot of load around on the distribution side.David RobertsYeah, if you're running a distribution grid and a bunch of the machines within it, their behavior is being coordinated on behalf of the ISO. That might not be exactly the kind of behavior you need for stability at the local level.Astrid AtkinsonAbsolutely. It might cause a lot of problems, and I think it's actually likely to cause some problems. However, there's nothing to stop a given distribution operator/utility from deciding that they want to understand what's happening, that they want to be able to play a coordinative role or at least get data from aggregators about what they're doing and to say like, "look, I want to take on a distribution system operator role within this broader system." And there are some implementations of 2222 that are kind of going that direction. The one I'm particularly thinking of is PJM has a filing for their implementation that does include coordinative function with the local utility.And I think that's really interesting. Now it doesn't necessarily 100% meet the needs of aggregators because it basically says that the local utility should have visibility into and perhaps dispatch control over aggregate resources.David RobertsKind of a veto, right? Because it's those local needs. That ultimately are the that's the actual toaster coming on.Astrid AtkinsonSo, you don't really want to veto either. But one thing that I think is really important to remember about those aggregators and the resources that they're managing on the customer side is that they want to get paid for the services they can provide. And one way to get paid for that would be to bid them into the wholesale market. But the value of the service that those local DERs could provide is actually a lot higher to the distribution utility that they're located on. If we look at kind of all up and down the value stack, selling energy on the market is part of that value stack.But selling peak shaving at the local transformer or substation level theoretically is very valuable in practice. No one's paying today.David RobertsRight. If there were a market at the local level, this is the thing. It almost seems like the DSO should be running a local market.Astrid AtkinsonAbsolutely.David RobertsAnd the DSO should be sort of serving as the aggregator. Right. So you let the local market do its thing, and then you bid for whatever's left. You bid up into the wholesale market. Does that make sense?Astrid AtkinsonYeah. And so I think what this does is provide an opening to start having that conversation. FERC 2222 doesn't really provide the structure for that kind of DSO/ISO aggregator coordination function as we see in other countries. But it does provide kind of a stick in the kind of carrot and stick sense, in the sense that you could either choose to take a leadership role in coordinating the behavior of assets on your network as a utility, or you could just let that happen and kind of deal with the stability and cost implications on the back end.And don't get me wrong, there's probably a bunch of utilities that will end up doing the latter, but there is an opportunity to do the former, and some will go that way.David RobertsYeah. So in your efforts to cajole utilities into doing things differently, I feel like the landscape is littered with the exhausted husks of people who have spent their lives trying to get utilities to do things differently. You're focusing specifically on co-ops and munis as kind of places to experiment with this more local model, this DSO model. Why is that?Astrid AtkinsonSo, we do also work with investor-owned utilities, but primarily with ones who have a vision for taking that leadership role and really kind of want to move that direction. But one thing that's really nice about working with co-ops and munis, which are both nonprofit, typically local utility structures, is that they have a very local set of motivations around serving the community, keeping costs low within their specific community. And they're also nonprofits, which makes things a lot simpler from a business model perspective. They also are pretty sensitive to the cost of energy, which for most investor and utilities is financially speaking, it's a pass-through.It's not really part of their profit model.David RobertsRight.Astrid AtkinsonSo for a coopera-muni to save a bunch of money on the cost of the energy that they procure for their customers, it's like kind of a direct benefit because that goes back to the customer in the form of lowered bills or for co-op, they even sometimes send checks back to their members, which I think is really cool, but they care a lot about this and that's a business motivation for them. Likewise, if they are looking at substantial system upgrades because they're going to see a lot of load growth that might be from electrification. But actually for these utilities today it's more often because somebody is like planning on putting in a factory or a data center or something like that.They're open to looking at non-wireless alternatives and kind of using smart management to avoid doing a very expensive substation upgrade again because they would have to pass that cost back along to a very limited number of members. And it's not like investor and utilities don't have a similar broad motivation or care about it. But if you're a co-op executive or staff member, people come up to your front desk asking about like "hey, why is my bill $15 higher?"David RobertsWe'll run into you in the supermarket.Astrid AtkinsonThat's right. And it's just a very different relationship with the community for those utilities.David RobertsSo you think they're more open to this. Have you gotten movement? Are there US co-ops and munis that are setting the standard here?Astrid AtkinsonYeah, so there are a bunch of utilities that have been really interested in kind of moving down this path, towards a distribution system operator model and taking on a more active kind of local system operator role. And that's true across kind of all of those segments from co-op to muni to some IOUs as well. The thing that's nice about the co-ops is that they can move faster because they're small, and sometimes also they will just decide that something's working and decide to roll it out broadly. Whereas if you're at an investor and utility and you had the greatest thing in the world, you'd probably still be stuck going through a kind of regulatory approval cycle for scaling it up.David RobertsProcess, process, process.Astrid AtkinsonThere's good and bad to that. But the co-ops are often self-regulating or at least minimally regulated by the Public Utility Commission because they are deemed to be acting in the public interest so they can move quickly. And so there are a subset of co-ops which are rural electric utilities that have been experimenting with these models and are moving very quickly in this direction and it looks different depending on the utility as to what that looks like for them. Some of them have been pushing really hard on generating energy locally and avoiding the wheeling costs of shipping it across transmission and putting that money back into the community.So there's one that we work with in northern New Mexico that does that, and they serve the area around Taos, and they decided that they wanted to get to 100% of their daytime electricity load served by local solar. They're actually at about 120% now.David RobertsOh, wow.Astrid AtkinsonAnd they're starting to look at models where they can export power out of the community, which I think is a really interesting economic growth opportunity for communities like that.David RobertsYeah. Again, if you can imagine these local markets, you can also imagine markets in between distribution nodes. Right. Like, imagine if my distribution node, I'm handling all the complexity within the DSO, handling all the complexity within the distribution node, comes up with a certain amount of leftover demand that it needs satisfied. It could procure that from the next distribution node over. Right. And it's in a peer-to-peer transaction and not have to involve the ISO at all, theoretically.Astrid AtkinsonYeah. And there's probably a bunch of different ways that this might play out, but you certainly could see a world where that's the case. And it has a delightfully localized kind of quality to it in the sense that the community is mostly self-supplying in local electricity and including batteries and flexibility that get them through the night. But they also have this opportunity to potentially export a resource that they have a lot of, which is pretty cool because it's sun.David RobertsPart of the delightful locality of it is that some communities might value resilience more, so they'll want to, say, bank more of their excess solar and batteries. Some communities might want the money more so they'll be more likely to sell it across to a different distribution. You can see communities will actually have much more fine-grained control over their energy. And one of the points Lorenzo makes a lot of times is this would make it much easier for local electricity and energy policy to be coordinated with local building policy and local transportation policy, and basically, like, your local — becomes part of how you want to run your local area.Astrid AtkinsonYep. And ideally, that would include members of the local community getting paid for the flexibility that they provide, too, because that's a big part of how we get this done. One other example I'd want to give for that is there's another utility I know pretty well. It's in Colorado. They're expecting to double their load in the next five years.David RobertsJust population growth?Astrid AtkinsonNo, it's actually a mix of factories, clean energy production facilities, delightful also, and data center loads, which are really growing due to all those big cloud computing facilities that we mentioned earlier. So they're looking at doubling their current energy usage, and there's no way they're going to get enough transmission additions built out to support that.David RobertsRight. Especially since it takes 10 to 15 years to build one line.Astrid AtkinsonYes. Transmission is one of the few industries where you can pass along a single project to your children, which is not a compliment.David RobertsA legacy project.Astrid AtkinsonYeah. And so they're looking very closely at models where they can trade generation and flexibility and storage amongst their large users, particularly within their territory. Because the usage profiles for a refrigeration facility are different from that of a shipping facility. Maybe a lot of EVs charging and different again from a factory facility. A lot of those would also be inclined to put local generation into the commercial and industrial site and getting all of that stuff signed up to become part of the future overall supply profile for that territory, it requires a DSO function. There's kind of no other way to do it.David RobertsYeah. Somebody's got to be in charge of all that.Astrid AtkinsonYeah. And so that's a place where the utility taking that leadership role really makes a lot of sense because I don't know how else they would manage it.David RobertsYeah. What do you think are the prospects of basically just local distribution utilities right now which are just sort of running the wires right now and billing customers growing into the DSO role? Like when you bring it up to them, do they just blink at you? It's such a sort of cosmic upgrade of their role and importance and responsibilities, etc. Are any of them eager to do that?Astrid AtkinsonYeah, I mean, there are a lot of utilities that see this as being part of their future. I think the tricky part is it's a really big change for an industry that hasn't had load growth in 20 years. Being able to suddenly adapt to all of the technology and organizational and business model changes required to support that is going to be a lift.David RobertsYeah. It's wild. Like 20 years without load growth and without really substantial change in the industry and all of a sudden now it's like new tech, new models, new regulatory models, new legal models like boom boom boom boom boom. It's a lot.Astrid AtkinsonYeah. And so there are utilities that are definitely thinking about this. Like SCE has a public roadmap that's really nice that covers a transition to a DSO model. The only thing that's a bit of an issue with the normal utility process for this kind of change is that it tends to be very slow and in many cases we're going to need to see rapid adaptation in the next like three to five years. And for most utilities, they're used to kind of planning on a five to ten-year time horizon.David RobertsYeah. Utilities and PUCs, I mean, I'm not sure that PUCs are exactly legendary for being agile either.Astrid AtkinsonThey do compare notes. So if you get something that works well in one place, a lot of times they will try to spread that more broadly. And so, from my perspective, one of the best things that we can do to make this happen is just show it operating at scale in as many places as possible. Not all of those will be right the first time, but it's not the kind of problem that you can really sit down for five years, come up with a solution to and then implement.David RobertsRight, which is the utility way, right. You make this point in one of your talks too. It's like the whole software world model, which is that you sort of build, iterate, test, learn, rebuild, reiterate, test, learn that's foreign to the utilities.Astrid AtkinsonAnd it's not that, in the software world, it's not like we don't plan ahead or design things. Of course we do. But you design with the idea that rapid iteration is going to get you closer to the goal more quickly.David RobertsRight.Astrid AtkinsonAnd we've seen really good success with this in adjacent industries. Right. Like one of my old bosses at Google was really interested in skydiving and decided that he wanted to jump from space from a weather balloon.David RobertsSuch a Google guy.Astrid AtkinsonThis is definitely a Google problem. And so in order to do this, he acquired — this is kind of post-Google for him, but he got really interested in spacesuit design, and then worked with the company in the US, that's a premier designer of spacesuits, who had not designed a new one since, like, 1973, to rapidly develop, prototype, test and deploy new spacesuits so that he could jump from space in a weather balloon. Which by the way is a total badass move. He's an engineer from the ground up. But so they worked in a really iterative kind of rapid development and testing cycle and they got that done within a couple of years and now the same company is developing the spacesuits that are like the next generation ones that are used for SpaceX and Blue Origin and all of those.David RobertsYeah. I mean, if nothing else, this is like a chance to be a hero, right? This is a wide open field and there's just so many opportunities here for innovation, for people to try new things and show successes.Astrid AtkinsonYeah, it's a really exciting time in the industry broadly and for the subset of folks at utilities that are really actually interested in thinking about what the future of the industry is going to look like and kind of working towards building that. Boy, it's an exciting time to be in that industry too.David RobertsI know. I've been writing about this stuff for 20 years now and it is still somewhat head spinning how all of a sudden it's just all happening.Astrid AtkinsonIt's changing really fast on the ground.David RobertsIt's just waiting and waiting and then boom, all of a sudden it's all happening. So I would feel bad if we did this whole thing and I didn't give you a chance to sort of say what your company does. Your company is called Camus. Why Camus, by the way? I was thinking existentialists. This must be about the existential despair that you experience when you contemplate trying to reform utilities?Astrid AtkinsonNot exactly, but related. So we are named for this philosopher, and the reason for that is actually really specific. So Camus wrote this essay called The Myth of Sisyphus.David RobertsYes.Astrid AtkinsonThere's a short version in a longer book by the same name.David Roberts"One must imagine Sisyphus happy." One of my all-time favorite philosophy quotes.Astrid AtkinsonYeah. So the short version is only about three pages long, and I totally recommend it. But Camus is basically asking, "how do you create a sense of meaning in the face of a large, uncontrolled, potentially godless universe?" Right? Like, where do you derive a sense of purpose? And his answer for this was basically, you pick something, you work on it, you find joy in the process. Not in the notion that you're going to win, but in the everyday act of pushing a rock up a hill and following it back down.David RobertsI love it. At the base level, I think there are sort of like levels of your service. At the base level, you're just helping utilities be more aware of DERs and then sort of laddering up from there, like coordinating them, et cetera, et cetera. So, how high up do you go on that ladder?Astrid AtkinsonWell, since we've gone to the trouble of describing a DSO and what it does, our goal is really to create a software platform that will enable a utility to take on that role. So a much more real time and local operations model that can include local resources as part of the supply and demand landscape and ultimately include them into capacity management and network management for the grid and let them get paid for it.David RobertsGot it. So you're creating the tools for the DSOs for whenever they show up?Astrid AtkinsonWe are creating the tools for the utilities that want to take on that role and working with them to figure out what that looks like in practice.David RobertsRight. And we should emphasize for the utilities out there listening, this is not a binary thing, it's not like —Astrid AtkinsonIt's a process.David Robertsjumping off the high dive into the whatever. There are pieces of this you can adopt, one at a time.Astrid AtkinsonYes, that's right. It's a process. Right. The question is not like, what's it take to get to the grid of tomorrow. The question is more like what is the set of reasonable steps that you can take with the data and control capabilities of today to add more sophistication, get better visibility, add coordination, talk to aggregators, coordinate with FERC 2022 deployment and 2222 deployments, all of those kinds of things. So it's going to be a process, but it doesn't have to be impossible.David RobertsBut it's just great that this idea of making the electricity system more like the Internet goes way back. As I'm sure you're aware, Al Gore was talking about the Internet. Of course, he's trying to coin a term for it back in 2007. And I went through a period of hype for it, and being very excited about it, and DERs, and all that. And then I sort of ran up against utility and transigence and had my life force drained. But now it seems like at long last the hype cycle has come back around and it's actually happening now.Like there's actual things happening, actual movement in that direction happening.Astrid AtkinsonIt's all happening.David RobertsIt's very exciting. So final question then, and this is kind of a bit of a curveball, but I'm curious. So say we imagine our glorious future here in the US, where we have revolutionized the system. And we now have all local electricity being administered and run by DSOs, who, as we say, resolve the complexity of the local area before passing on a signal upward, maybe nested a couple of levels. Maybe like the level above them has three or four distribution nodes and the level above them, et cetera, et cetera. But by the time it gets to the transmission level, you've already maximized the use of local resources.Basically, the goal here is to maximize the use of local resources before calling on large scale distant resources. So imagining that glorious future where we've made that happen, how much of net US energy do you think will come from local resources versus still coming from big utility scale power plants on the transmission system? Do you have either a predicted or desired balance of those two in your kind of perfect world?Astrid AtkinsonSo I've seen modeled estimates that put that somewhere between 30% to 50%. And you talk to other folks in the space who do modeling on this. There's some really good work from Vibrant Clean Energy that did a bunch of work on the potential role of local resources a couple of years ago. But I think somewhere in that kind of 40% ish space is likely and practical. In Australia right now, by the way, it's sometimes 50 and sometimes 70% local. So it's just like do you mean instantaneous or overall? Because if it's instantaneous, sometimes it could be 100% or even more if we're storing.David RobertsRight. I mean overall, like on a net yearly basis —Astrid AtkinsonBut on an overall basis, because the sun does go down and the wind doesn't always blow, as you covered very well. I feel like 40% is pretty reasonable.David RobertsInteresting. That'd be a good, like something to go to one of those betting sites, start a pool on, say, 2040. What's the net balance? Well, Astrid, this has been an absolute delight, as I knew it would be. I love this whole subject. I love what you're doing. As I say, it feels like you are someone that I willed into being by writing my 2018 piece, which is I'm sure you existed before that, but —Astrid AtkinsonI certainly did. But the piece made a huge difference in how I was thinking about the space. So I'm pretty grateful for that.David RobertsAwesome. Well, it's a delight to have you on, and I'd love to have you back on again sometime once this stuff evolves some, because this is an endlessly, inexhaustibly fascinating topic. So thank you again.Astrid AtkinsonThank you so much.David RobertsThank you for listening to the Volts podcast. It is ad-free, powered entirely by listeners like you. If you value conversations like this, please consider becoming a paid Volts subscriber at volts.wtf. Yes, that's volts.wtf. So that I can continue doing this work. Thank you so much and I'll see you next time. This is a public episode. 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The Federal Energy Regulatory Commission (FERC) is poised to pass new policy that will expand regional transmission capacity, but how impactful will its new rule be? In this episode, grid policy expert Rob Gramlich gives the lay of the land.(PDF transcript)(Active transcript)Text transcript:David RobertsBy now, it’s fairly well understood that the US badly needs more electricity transmission lines to keep up with the changing generation mix and growth in demand that will come with clean electrification. But new lines, especially the much-needed longer-distance regional lines, are being built at a snail’s pace. If the US is to hit its mid-century climate goals, transmission capacity expansion must radically accelerate.Congress helped a little with money in the infrastructure bill, and the Biden administration helped by establishing a Grid Deployment Office inside the Department of Energy, but arguably the biggest opportunity for progress comes in the form of an upcoming rule by the Federal Energy Regulatory Commission (FERC). It will beef up the commission’s existing rules on regional transmission planning, but exactly how much it will strengthen them depends on the final rule, expected early next year. Transmission advocates are urging FERC to pass a rule with reel teeth — including Senate Majority Leader Chuck Schumer, who sent the commission a letter with encouragement and suggestions in July. Nobody knows more about grid policy than Rob Gramlich, founder and president of Grid Strategies, a policy analysis and strategy firm. He is executive director of the WATT Coalition, co-founded and used to run Americans for a Clean Energy Grid, serves as a board advisor to a half-dozen other groups, and has a long history in the industry, including a stint at FERC in the early 2000s. I talked with Rob about the current state of affairs in transmission policy, the scope of FERC’s authority, and the details that matter in the coming rule. Don’t let the technical-sounding subject scare you off — this was a fun one, and incredibly clarifying.Okay then, with no further ado, Rob Gramlich. Welcome to Volts. Thank you so much for coming.Rob GramlichThanks, David. Great to be here.David RobertsI am excited to talk about this. I know that perhaps FERC is not at the top of people's mind when they think about excitement and thrills, but I think people will see by the end of this why this is a very good time to tune in to what FERC's doing. So let's start here. I think we can assume for the purposes of this pod that Volts listeners understand the need for more transmission, specifically the need for more long-distance transmission for a bunch of reasons. We know that the resource mix is changing. We care more about renewables now.They're located in different places. They're located not necessarily next to load. They're remote. We're going to double or triple the amount of electricity we're using in the coming years, because we're electrifying everything. So we need more transmission for that reason. We know that connecting up a wider geographical area makes the whole system more reliable, makes the whole system cheaper. Transmission is the wonder tool of energy. It makes everything better, and yet we are not building it. So back in the late 90s, FERC, the Federal Energy Regulatory Commission, which has jurisdiction over interstate transmission, released a series of orders.So in the beginning, there were, just across the nation, just dozens and dozens of individual vertically integrated utilities, all of which were building their own transmission, more or less for their own areas. And so back in the late 90s, FERC saw this and many other people saw the need for more interregional transmission and issued a series of orders trying to kind of nudge things in that direction, doing, among other things, they created regional transmission operators and independent system operators, RTOs and ISOs, which were supposed to be regional organizations that did regional transmission planning. And there were others too, I think, going all the way up to 2011, there were other orders, basically like, "please friggin utilities, get together and start doing some planning, do some interregional planning." And yet, despite this series of orders, and despite the existence now of RTOs, we're still not building interregional transmission.I mean, we're building it at a snail's pace and not necessarily where we need it, and certainly nothing close to the pace we need to be building at. So maybe let's just start here. Why, given the existence of RTOs, which are explicitly supposed to do this, is there still not adequate regional transportation planning? Maybe you could run through the three P's here. That's going to help kind of set us up for what's to come.Rob GramlichSure. Well, first of all, thanks for your help in communicating all that. So let's stipulate that the need for transmission is understood. And that's great that it is, because a few years ago it wasn't. But you've been helpful.David RobertsIt does seem like that at least has sunk in, in the wider world.Rob GramlichI think that's right. And of course, in recent years, it's been more sort of the climate-focused policymakers and community who have understood this, which is great, as they should, for the incredible clean energy need for transmission and climate benefit. But just suffice to say, it wasn't always such a democratically tilted issue. But that's a separate conversation we could get into. But, yeah, FERC has been, in the 90s, the early 2000s, had orders trying to beg, plead and borrow the industry to get going on regional transmission. And in fact, it goes even way back. I mean, the 1935 Federal Power Act itself has some language about the voluntary, encouraging the voluntary coordination of the systems.And then there were actions in the pre-war and wartime to be able to produce the military assets and airplanes and everything by — we needed to increase the production basically out of the electric industry.David RobertsYeah, it's a bummer. We decided to build this interstate road network basically for security purposes around then, and did not decide at the same time to do the same thing for transmission. It would have been a good move on our part.Rob GramlichThat's right. But there were actions by the predecessor to FERC, the Federal Power Commission, during those same years, though, trying to strengthen the connections, but it only went so far. And then it was really when the electric industry tried to restructure to get generation competition in the 90s that it started pushing harder. There was a 1993 regional transmission group RTG policy statement, and then they said, well, that's not enough. And then they had Order 888 for open access transmission. That included a push for voluntary creation of independent system operators. That's where that term really came into practice.It was encouraged and voluntary. And then the commission tried in 1999 to require participation in the regional transmission organizations (RTOs). That's where that term was sort of defined. But Chairman Hoecker, at that time, couldn't quite get the votes to make that mandatory — so it was voluntary. And then I was part of — my full-time job was standard market design. I'm not embarrassed to say that one never made it to being even a rule because of a political backlash. Again, another story for another day. But that was at least strong encouragement. And then Order 890, when Republican Chairman Joe Kelliher came in, he had been on House Energy and Commerce and in the Bush administration, and he tried to require, well, he did require through Order 890, some strengthened planning requirements.And then Chairman Jon Wellinghoff issued Order 1000 and the commission, of course, in 2011. And that also sort of went another step further. In this process, some of those orders were challenged in the courts. Then FERC's hand was actually strengthened after all of that because the court challenges upheld FERC's authority and said, "absolutely, you can require transmission planning." So FERC's role here has only been strengthened over the years in terms of the clarity of its legal authority. And yet, as you say, it hasn't really worked yet. So here we are at the end of 2023 with an agency that actually is in charge of this and has quite clearly been claimed by the courts to be the one entity that can really do this in a significant way.And it's actually kind of exciting now, because look at this, we have this great proposed rule that Chairman Glick and the commission issued a year and a half ago —David RobertsWell, before we get to that, though, I want an explanation for why those previous ones didn't work. Like why aren't RTOs building these things?Rob GramlichYeah, there are probably a few reasons.David RobertsYeah. In like 100 words or less. Because we can't get too bogged down in this, because I know this is a tar pit.Rob GramlichI'll try to just give you a few. Look, I mean, one issue is incumbent generators don't necessarily want to enable new generation to come onto the grid. So we have these RTO entities, incumbent generation owners, whether they're part of a utility or independent, they are usually not the strongest supporters of new transmission. So that's a factor. And then those entities are active in FERC proceedings as well. That's one factor. Another factor: We had all this transmission collaboration happening in 2010 through 2013, and a bunch of transmission got built. We actually got a ton of new renewable energy connected to the grid a decade ago.From these, I'm sure many of your listeners know about the multivalue projects in the Midwest and Texas competitive renewable energy zones. So there was a little bit of a renaissance then, but then it was very short lived, and it ended like ten years ago, it stopped. Some people say Order 1000 had some unintended consequences that stopped that. I think that's part of it. Also, the cost of solar dropped and the cost of gas dropped, so a lot of that transmission was more wind driven. And when you could do a lot of gas and solar, you didn't need quite as much transmission.So I think that does factor as well. And then I just sort of think, like, inertia took over. People got used to going to regional transmission planning meetings and making sure nothing actually happened, and they got good at eating muffins and checking the compliance box, but then not actually doing anything. So, I think it's just ripe for a whole reshuffling. And that's what FERC can do.David RobertsOkay, so before we get to this FERC opportunity, let's at least give a little shout out to some movement lately, some policy wins. So in the Infrastructure Act, the Bipartisan Infrastructure Act, there's some money for transportation, which I think is nice but inadequate. And then there's this new Grid Development Office. Are those the two biggies, and how sort of like a big of a deal are those, relatively?Rob GramlichRelatively, yeah, potentially over time. The Grid Deployment Office could be huge, and it's off to a great start. I will say the current team there and the current administration and Secretary Granholm are leading, I think, a very productive and promising exercise there.David RobertsWas that created by legislation, or was that just created by an executive action?Rob GramlichTechnically just an executive action by Secretary Granholm. She can set up offices, if she so chooses —David RobertsAs an office within DOE.Rob GramlichThat's right, which — put this on your list of future policies. Let's actually formalize that in legislation. It would be nice to do that, but there was actually an attempt. But that's a longer story. But that office has financing tools, it has permitting tools, it has capabilities. They've been hiring like crazy, really good people, and that could really be a very helpful enabler of transmission, private sector investment. There's no shortage of capital that wants to invest in this sector, but it's just a morass trying to get projects done. So DOE has important tools. Many of them are now kind of all being consolidated in this Grid Deployment Office to enable transmission.David RobertsAnd what's the money in the Bipartisan Infrastructure Act?Rob GramlichRight. Well, very little, unfortunately. I mean, there's like one really great provision called the Transmission Facilitation Program. Senator Cantwell introduced that, but it's a $2.5 billion program, and it's not technically a loan, but it's sort of like a loan. It does have to be paid back, and so it's not really that much money. It's intended to be a revolving fund, but $2.5 billion in the scheme of an industry that spends that every couple of months is not transformative.David RobertsAnd there was, at one point in the Build Back Better saga, a pretty hefty tax credit for transmission, which got stripped out at some point. That would have been serious money, right?Rob GramlichThat could have been serious money. It's scored at 13 billion. But who knows? The way tax credits work is if the industry really gets excited, it's uncapped. And more could have been done, so that could have been great. And it's so hard to figure out who pays for how much. Just starting to evolve into the three P's, planning, permitting and paying that paying part is, I think, the hardest, because it's a public good and everybody benefits some, so nobody wants to pay for it. And so that tax credit could have at least made that whole problem 30% easier by covering 30% of the investment cost.David RobertsRight. So then you're having to allocate 70% rather than having to allocate 100%. And we'll get into that cost allocation in a bit. So we've had some movement, but inadequate, and there is some legislative stuff that would be relatively easy and high impact. And maybe when we get through this FERC stuff, we can touch on that before we're done. But now, in terms of the tools Biden has to use here, well, not even Biden, really, since it's supposed to be independent. But in terms of federal tools, basically we're dealing with FERC. So before we jump into the proposed rule, let's just talk for a second about FERC.As I understand it, there are supposed to be five commissioners, ideally. There are, in fact, four, and we're heading to three. So, make some sense of all that for us. Where are we with FERC in terms of the balance of commissioners?Rob GramlichYeah, that's right. There's supposed to be five, no more than three from one party. So over the years, it's typically been three-two, one direction or the other.David RobertsRight.Rob GramlichAnd Chairman Glick, his term expired, and so he is off. And that seat is open. Commissioner Danly, his term ends, well, technically, June 30.David RobertsSo, wait, Glick is gone, which left a two-two Republican-Democrat split. That's the current state of affairs?Rob GramlichThat's the current state of affairs, as we said. Yes, for, I guess, the entire year of 2023, it'll be two-two.David RobertsRight. And then Danly, who is a Republican, is stepping down when?Rob GramlichThat's right. So, yes, every year one seat opens because they're staggered five-year terms. So he will need to leave by the end of 2023 in a month or two.David RobertsGot it. Which will leave a two to one Democratic majority on FERC and those other two — we don't have to get into this, but what the hell is going on? Why is it taking so long to get new commissioners? Is it Joe Manchin? I'm just going to throw it out there. I'm just guessing. Is it Joe Manchin?Rob GramlichWell, I mean, certainly he's the chair of the committee and he has strong preferences that he expressed both on existing commissioners and potential new commissioners. And the White House technically gets to — you know, the two of them have to agree, the president and Senator Manchin, but also the history and the tradition — the practice is sort of often one party will pair with the other party, so you'll do two together, and there's just been just a lack of activity. I'm not actually sure either party. I'm not sure the president or McConnell or Barrasso or Manchin. I'm not sure any of them are like, hustling or feel a need to hustle to get a lot done right away.I think they all recognize, like in 2024, when you're down to three, then you really can start having problems. Like, you might not have a quorum just to get business done. Somebody might have a cousin who, one commissioner might have a cousin who works for a company, and they get recused from the case and you can't vote the order out, and it gets dicey like that. So just when situations like that arise, the Senate Energy Committee, knowing it's their responsibility to make sure business can get done at FERC, they'll get more active. So I do expect in early 2024 they will get active.There seems to be a name that Manchin and the White House agree on. There could be a pairing. There could be somebody that McConnell and or Barrasso recommend from the Republican side. But I think everybody's kind of holding their cards close right now. There's not a lot of —David RobertsAnd that could take a while. So what's relevant for us here, I think, is if this rule is, the rule that we're about to talk about is advanced expeditiously, it could be voted on by a three-commissioner FERC, with a two to one Democratic majority, meaning it could be made good and strong and get through with Democratic votes.Rob GramlichThat's right. I mean, the order seems close to ready. They wanted to do interconnection first. We could talk about that, but that was a major undertaking, one of the biggest orders ever. And so Chairman Phillips had to sequence things one way or another. Couldn't do them all at once. So that happened first. They seem to be getting close to ready on this big planning rule. And so I think early in 2024 they'd be ready to do that. It will be a two to one at that point. But everybody in FERC world likes to not talk about it in partisan terms.David RobertsOf course, or pretending.Rob GramlichWell, the proposal did issue as a unanimous bipartisan proposal. So the hope is that it would be a three to zero and it could be.David RobertsI mean, let's just say there's no obvious reason that this should be partisan at all. It's literally good for everyone, except maybe some utilities. It's good for society. Name your entity. Bipartisan would be nice. But should that fail, it could still get through. So tell us a little bit about this planning rule. It dates back to 2021. It was a Glick joint originally.Rob GramlichThat's right, yeah, so Chairman Glick and his team really led the development of it. The other commissioners were there, Commissioner Clements is the other Democrat on the commission who I don't think we mentioned yet, and she's very supportive of the rule. And then they had this extensive process with the states. That's part of why it's taken a lot of time, which is, I think, great and very helpful. But there's this incredibly extensive record of discussion with states on how this works through this joint federal-state task force. So it has been out there for now 18 months. And again, we had commissioners transition and a chair transition and other big orders that the commission had to get out, but I feel like it's ripe now and good and close to ready.David RobertsOne other preface question. So I saw that Chuck Schumer, Senate Majority leader, wrote a letter to FERC recently acknowledging the importance of this rule and giving some recommendations for strengthening it, recommendations that, as far as I can tell, were lifted more or less straight from this report you wrote last year with recommendations, and we're going to go through some of those recommendations. But is it the case that the current order, as it currently exists does none of these things and that's why you're recommending all these things? Or so it's unclear on how strong the extant order is and how much of these recommendations — you know what I mean? Where is it now?Rob GramlichYeah. So many things are great about the order. It has all the right analysis, I think, and record evidence and support from a really vast majority of the industry, including utilities and consumer advocates and the whole range of stakeholders who care about these things. And the proposed rule is generally, I think, excellent. And I think Chairman Glick is going to be commended or should be commended for that, as well as the other commissioners. But there were a few things that somehow ended up a little bit weak in the proposal, and I don't think, accomplished what the commission thought it was trying to accomplish.Now, there's a lot of cooks in that kitchen, and the commissioners don't talk about internal deliberations. So one can only on the outside kind of guess what happens on the inside. Where I used to be there walking up and down the hall trying to negotiate orders like this. But sometimes you can guess because the commissioners make public statements about what they like or dislike or what they would want to see in the final rule. But I thought that letter you mentioned from Senator Schumer did an excellent job of saying, "hey, here's a few things you really need to fix to make this thing do what you say it does."David RobertsYes, let's walk through some of those. So there's sort of three buckets here of recommendations. One is about planning what to require in terms of interregional planning. There's some stuff about cost allocation, paying the planning and the paying — permitting, I think is separate and will have to be dealt with separately. And then there's stuff on basically making sure the process is cost-effective with a little bit more FERC oversight. So we're going to walk through all those. So in terms of interregional planning, there are four specific recommendations about what to require of the planning process. So let's walk through those.The first is just maybe do your planning based on what you actually think is going to happen to the electricity system, forward looking rather than backward looking. Just tell us a little bit about that.Rob GramlichYeah, that's right. And by the way, the rule really is more intra-regional than interregional. They're going to do, hopefully, they'll do interregional separate, but they bit off the intra-regional.David RobertsOh, so this is planning within regions.Rob GramlichRight. As a first step. But honestly, everything in here could equally be applied. You could just a year later come through with a redline — global search and replace intra with inter. And it's all the same, things would work. But let's focus on the regional. And these are wide regions of the country, you know, the whole Midwest, the whole mid-Atlantic. The west is in three areas, but could be one merged together. There's discussion about that. But at any rate, yeah, the planning requirements. And again, the courts have said, FERC, you've got very strong authority to require planning practices, whether you can actually direct the outcome, like plan for this or that outcome.That's sort of untested. But in terms of planning methodologies, absolutely FERC, go for it. So they issued these planning methodologies and the first one, as you say, is essentially plan for the anticipated future resource mix. If you're going to plan —David RobertsI had to read this section a couple of times. I'm like, "they're not doing that?!" What else would you do?Rob GramlichYou would think that if there are these organizations around the country with regional planning in the name of the organization and in their charter of what they're supposed to do, as well as departments called regional planning and people with regional transmission planning in their title, you would think you would be forgiven if you thought, "oh, these people plan," which by any definition means like preparing for the anticipated future.David RobertsRight, right.Rob GramlichWell, that is not actually what happens. So in most of the country, they really don't do any kind of long term, they don't do an estimate of what the future resource mix is going to be. And I'm talking about load and generation and retirements and additions and all these sort of macro categories of the things that change on a transmission system. And by the way, it's not like saying, "oh well, the president wants to decarbonize the system by such and such amount, by such and such a date, therefore everybody do that." No, it's not even saying that.It's just saying "regional planner, you and your region anticipate these changes, these additions, these subtractions, these load changes, and then plan for that."David RobertsSo the critique is not even that your forecasts are inadequate or that your forecasts and modeling are flawed in some way, but just that they're literally just not —Rob GramlichONot doing it.David Robertsdoing at all. Right, that's a little crazy. Seems like an entirely reasonable request that when you're planning, you anticipate what's to come. And especially, I think this is implied, but let's just state it, because we're in a period of incredibly large scale rapid change in that very system, in what sources are coming online and retirements are accelerating all this growing load because of electrification, et cetera, et cetera.So it's just crazy that your regional planning involves no regional planning.Rob GramlichExactly right. And that's a striking thing about the official record evidence in this case of like so many, I mean, scores of utilities in states came in and say, "yeah, we basically think all these changes are happening and we need to plan for them." And those entities, states and utilities and others come from a variety of political perspectives about whether they want those changes to be happening faster or slower. But they all kind of acknowledge some baseline. And of course I'm sure in the details their estimates are different, but they're all pretty much in the ballpark and directionally all entirely consistent, that, for example, there's just going to be dramatic wind and solar and storage growth in every region, and that's when it's in the interconnection queue and every other evidence of what the changes are going to be.So there was a remarkable alignment in the record about the changes happening that need to be planned for. And so, yes, first and foremost, if your listeners have to shut off the podcast now, please don't. But that's the number one, just very basic thing that this rule would require.David RobertsNumber one requirement for planning process involve planning.Rob GramlichRight. Plan for the future, right. It seems radical, but yeah. Planning for the past — no, no, don't plan for the past — we're planning for the future. Radical idea.David RobertsSo then number two is consider all the benefits holistically. To say a little bit about sort of like what current practice is and what that would mean.Rob GramlichTransmission has multiple benefits. There's reliability, resilience. It reduces congestion on the grid, which is sort of the day to day cost that consumers have to pay when you have to ramp up expensive generators because of transmission constraints —David RobertsOr curtail solar.Rob GramlichOr curtail wind and solar, absolutely. And it's very hard to often separate out all these benefits. I mean, you build transmission for one purpose and it has all these other benefits for other purposes. Well, this is where the proposed rule got kind of weak. It sort of, here's all these benefits. But then it kind of goes back through and says, "well, those are sort of optional.You can look at this one or that one. It's sort of up to you." Well, the problem with that is that's not a regulatory requirement. That's just giving — based on the power structure of a region. If they choose not to do any of this stuff, it's giving them a get-out-of-jail-free card to not do this, to say, "well, we're just going to pick and choose our benefits." And what happens is it's like if you think of a really basic benefit cost analysis, if you're allowed to say, "well, I'm only going to consider one of the four or five or more types of benefits compared to all of the costs," you're almost guaranteed to not have the transmission lines pencil out.David RobertsRight.Rob GramlichIt's sort of like if you bought your car only for the basis of its benefit to drive to the grocery store, but not all the other reasons you use a car, you're probably not going to buy a car because it's not worth it just for that.David RobertsAnd also, let's just say there was nothing in place preventing them from considering these benefits. So telling them voluntarily, you may consider these benefits like, yeah, they could have been considering these benefits and they aren't. So clearly there's a reason they aren't, so clearly they need to be pushed to do it, not just allowed.Rob GramlichExactly. Right. So what's the point of a federal rule if it's just an encouragement to do what you're able to do before?David RobertsRight. So this would be a requirement that in those cost benefit analyses run on a particular transmission project, that all the benefits of the transmission project, including resilience, emission reductions, reliability, cost, et cetera, all be put on the benefit side of the ledger.Rob GramlichYes, that's right. Now, in the details, there are some issues. FERC didn't even go into a carbon benefit or any number of benefits you could get to that are sort of a little bit outside of normal FERC Federal Power Act jurisdiction. And without going too far into this, there's a little bit more that FERC can sort of allow and accept from regions as opposed to what it would require if it's doing a nationwide rule. So again, what I'm suggesting and what a lot of different clean energy and environmental groups suggested is very modest in terms of just doing the basics within traditional FERC regulatory domain about reliability, resilience, and congestion cost, traditional economic regulatory things that couldn't be misconstrued as making FERC be an environmental regulator for the country.David RobertsRight. So, require the basics and then maybe allow extras like emission reduction. So that's number two, consider all the benefits. Number one, plan. Number two, consider all benefits. Number three is when you are looking for solutions to congestion, etc., consider all the possible solutions. So a new transmission line is not the only possible solution to the problems solved by transmission lines. So, explain that one just a little bit.Rob GramlichSo, there are different technology options that are available today, which is great. There are grid enhancing technologies, and I know you had a recent podcast on that.David RobertsVolts listeners are familiar with these ways of getting more throughput from existing transmission.Rob GramlichSo, I recommend going there. And so those technologies were recommended. A little bit of back and forth about the exact list. Hopefully, that turns out in a good place to consider all those technologies. So that's kind of the category of like squeezing more out of the existing wires. And then another category is new wires. There's new types of conductors, high-performance conductors, I call them.David RobertsThat's called reconductoring existing lines. That's what that's about?Rob GramlichYeah, that's one way to do it where you can just put a different wire on an existing tower, or you can take the towers out and put a different type of maybe bigger, heavier cables. You can have superconductors, you could have composite core. There are different opportunities for that. So there's conductors as well, and then more broadly, there are just other technology options. And so FERC proposed these, and I think various parties are just trying to make sure that the commission requires full consideration of these technologies, in part because, look, nobody wants to have to go to new rights of way when you don't need to.David RobertsYou say maybe like from a social perspective, we don't necessarily want to do new rights of way because they're difficult and they take a long time. But it's worth saying here that the utilities, the reason this needs to be made mandatory is that the utilities make money by spending money. Right. This is something I come back to over and over again. Like from a utilities perspective, they get a big rate of return if they build a brand new transmission line, whereas some of these other technologies, I think, fall under kind of maintenance costs that they don't get a rate of return on.So this is one of those areas where utilities probably prefer building more hardware when there are alternative solutions that could avoid the need to build that. Is that accurate?Rob GramlichThat is an issue. There are a lot of utilities that are doing a lot of great stuff on their system, but it's also true that this is a regulated monopoly industry. There's a reason we have economic regulators, and their job is to ensure that we get reliable service at affordable, just, and reasonable rates. And the reason we have this whole regulatory system is because the incentives are not aligned with consumers' interests if left unregulated. And so that's just sort of what regulators are supposed to be doing. And they're supposed to make sure, and they do this at the state level and the federal level, they're supposed to make sure that the right technology is deployed and it makes sense to get that reliable service at a reasonable rate.So consumer interests are very persuasive and important at FERC on this. They want to make sure, particularly because a lot of these are very low-cost technologies. They want to make sure that these technologies are deployed in the right way at the right time. I think a lot of the folks communicating with FERC feel the same way. And again, from those who are concerned about land use have the same type of concern. They don't want to disturb previously undisturbed land with new rights of way if they don't have to. So this is where these technologies can really come in and help maximize what we get out of existing rights of way and existing transmission assets.David RobertsAnd so then the fourth, and this, I think, is a little bit more to wrap your head around. The fourth is that these organizations should select, rather than doing these cost-benefit analyses one at a time on proposed projects, FERC should require them to work on a portfolio and to do the cost-benefit analysis basically on the portfolio. So instead of choosing an individual project to maximize benefits, you're choosing the portfolio that maximizes net benefits. Is that accurate?Rob GramlichYeah, that's right. There are a lot of efficiencies there that can be uncovered when you look at all the transmission options and configurations together and find the right portfolio or the right suite of upgrades. There could be just a substation expansion or upgrade that solves a problem more efficiently than a new line would. Or when you put some technologies along with a substation here and reconductoring over there and a new line over there, the portfolio has a lot of efficiencies because it is a network. The whole thing is an integrated network. So treat it as a network, plan it as a network.And so that's kind of another sort of best practice transmission planning feature that historically — I mean, if you ask the planning engineers from 50 years ago, when we actually planned big transmission before, they would say, "of course, we do that. How could you do it any other way?"David RobertsThis is another thing that, like, "duh" —Rob GramlichRight.David RobertsOkay, so to just summarize here in the planning portion of these recommendations of this upcoming rule number one, plan for the future actually forecast what's going to happen and plan for that. Number two, consider all the benefits, not just singular benefits, not just the benefits you pick and choose three, consider all possible solutions, not just new lines, but also new ways of getting more of existing lines. And then four, apply all this to portfolios rather than individual projects. So you want considering all benefits and all solutions to different portfolios so that you can maximize the aggregate benefits of this.All of those, as you say, seem like things that are obvious and that anything going by the term regional planning would already be doing, but it is not happening. And so, FERC has an opportunity here to basically require RTOs to do this. So that's the big planning section. And that, I think, is the main event here. Those four alone, I think, would be transformative. But then we come to the second knot of the planning-paying-permitting Troika, which is cost allocation, which is a kind of unnecessarily technical term for just if you're going to build a regional transmission line that crosses boundaries from one utility to the next, from one state to the next, that crosses over all these lines, it is not obvious how to pay for it, or rather, who should pay for it.Who should pay for these lines? Is it the people building them? The people who will benefit from them? And right now, the loose rule is roughly people should pay according to the amount of benefits they get from it. But this is not, like the rest of the process, working very well. So tell us a little bit about how FERC should be trying to tweak cost allocation to work better? And is part of this just by having a formula or some sort of cost allocation formula that can be applied to every project rather than kind of like a bespoke process for every line?So just talk a little bit about cost allocation and how FERC's trying to solve it.Rob GramlichThe basic problem is, as you say, it's essentially a public good. Everybody benefits to some extent. And like with other public goods, classic public goods, like national defense or bridges and roads and public transportation, everybody would rather have the other guy pay for it and get to use it. And that's just natural. And that's why we have usually public financing right through our taxes, all of those things. Now, the electric industry is different, and it's generally a private industry, not public. And FERC isn't about to completely change that, nor is there really reason to. But we just have to figure out a way to allocate the costs in a fair way, just to make sure that sufficient infrastructure gets paid for so that it can be built.So that's why we have this challenge called cost allocation and one of the three Ps, the paying part of the three P's. So FERC's main need here and proposal here is to make sure that a decision gets made. Okay. It sets up like a process at the regional basis where the states get a chance to weigh in and figure out a solution. And hopefully that leads to agreement on how to allocate the cost of a transmission plan. Maybe they'll decide to have one formula that stays in place for all time, or maybe they'll review it based on each plan every couple of years when it comes through.But the risk now, if FERC doesn't clarify this in the final rule, is that if they don't agree, it just gets stuck. Well, that obviously doesn't solve the problem or get infrastructure built. So at the end of the day, there has to be a way to resolve a disagreement between states. And so that's pretty much all it is, just recognizing that, "look, this can be hard, it's never easy, but at the end of the day, a decision has to be made."David RobertsWell, can FERC say in this rule, you must make a decision?Rob GramlichYes, yeah. And that's essentially what hopefully they will say.David RobertsThis is, you know, continuing a theme from the previous section. But also I noticed the recommendations are that they should be assessing costs also based on portfolios, portfolios of projects maybe, rather than like who's paying for this individual project? This individual project considering a portfolio and then sort of the aggregate costs —Rob GramlichThat's right.David RobertsDoing cost allocation based on that.Rob GramlichYeah. And that helps with the cost allocation challenge. If you do all the assets and upgrades together, then the chances are greater that everybody benefits a little bit, as opposed to when you just kind of come in and say, "hey, I got a line from here to here." Well, guess what? The people in all the other places on the region say, "well, I don't want to pay a dollar."David RobertsYou end up with a mire there because it's like, where to draw the line around those benefits, as you say, mostly will be on either side of that line. But also in some second order way, a regional benefit, also in some second order way, a national benefit, I mean, benefit to humanity, to where you draw that line is somewhat arbitrary. So I think it's helpful to take at least a bigger unit of analysis.Rob GramlichThere's no magic bullet here where could say, "here's the best formula, now everybody do it." Because some regions, when I go, and I don't know, I was in the Pacific Northwest and they're like, "yeah, we could really put together something, but we need flexibility to — everybody needs to poke and prod at the benefits evaluation and come to the table and support it. In other words, get to a bespoke cost allocation agreement among parties," whereas other regions are like, "oh, man, if we had to go back and relitigate the benefits and cost allocation with every regional plan, we'd never get anything done."So there is this tension that FERC is going to have to balance between the bespoke and the formulaic approach here. And there's not a good answer that works well in every region. You know, I think they can provide very helpful guidance. They can narrow down the funnel of the things that people can agree or disagree about and get to much greater alignment about how to measure the benefits. So those types of things, as well as the process with the states, I think could be helpful.David RobertsAnd as you say, just requiring a decision, "you can't leave the dinner table until your plate is clear," type of thing.Rob GramlichWay to give it a really bad taste in people's mouths. Now everybody's thinking about the bad brussels sprouts, but, yeah, no, you got to have a decision at the end of the day.David RobertsAll right, so that's planning and cost allocation, planning and paying. So then the third section of recommendations, I think are really interesting. And my instinct, and maybe tell me if I'm wrong, is that this might be the most uncomfortable for FERC, or maybe you might find the most resistance within FERC. Tell me if I'm wrong about this, but this is just a section about FERC oversight. Basically, the recommendation is like FERC needs to take a more active hand here in ensuring that this regional planning process is being done well. It's being done in a cost-effective way, which is just going to be a little bit more active governance, a little bit more active oversight.And quoting from the report, "eliminate the multi-stage process that currently prevents inter-regional projects from being constructed." So tell us a little bit about what role you envision for FERC here, what these recommendations are about, greater oversight and sort of like what the political valence is of those recommendations.Rob GramlichRight. Well, again, FERC is the transmission regulator of the nation, and the courts have clarified that over recent years. And so I think the main thing here is to put these planning approaches out there, put it into regulations, require them nationwide. Sure, there's going to be regional flexibility and each region has a different set of institutions that will come into play and be used. I think FERC can sell this whole rule as providing plenty of regional variation and flexibility. But at the end of the day, you've got to do these planning practices and FERC has to oversee that they happen.So with any nationwide rule from a regulator, there's always the risk of you put it out, you require compliance filings, and then you kind of loosen things up on compliance and then over time they get away with things. And the regulator isn't making sure that the rule was followed.David RobertsRight. The rule only matters if there's some stick, some element of enforcement.Rob GramlichRight. And the industry does follow it. I mean, look, there were plenty of opponents of open access in the mid 90s. Now they all have open access tariffs and they follow them like they're contracts. And anybody can bring a case to FERC enforcement if the tariff is not being followed, the tariff being like the public contract. And so the same would be the case here. And so just one hopes that FERC would follow through in implementation and make sure that all these practices are followed.David RobertsWell, what can FERC do, though, if I'm an RTO and I'm not following these practices and someone brings a case before FERC saying "this, such and such RTO isn't doing what you said." What sticks does FERC have in its backpack?Rob GramlichWell, in some cases they do have enforcement authority and financial penalties. That's more in the market manipulation realm, but with the regional transmission organizations, and I should also say the planning entities that are not in the RTOs. Right, because we've got the Southeast and the West where there is no RTO, but they would also be subject to this rule. FERC just simply has to tell them — it's not a great answer to your question, but they set the rules and they are the regulator of these entities and FERC enforcement can get involved if they don't comply.David RobertsSo if it comes to it, then FERC can penalize them financially. That's basically what it's got in its.Rob GramlichI don't know the extent of that on something like a transmission planning practice, but they do have some penalty authority that came up in the interconnection context. So there may be some of that.David RobertsAnother thing mentioned in this section is the possibility that FERC could impose performance-based rate making on some of these entities. Is that a significant possibility?Rob GramlichI think there is some possibility there in certain contexts. It's not within the scope of this particular rule. There are forms of incentives. FERC got all this incentive authority in EPAC of 2005 and they haven't really — well, they've used some of it. It's been sort of back and forth. And there are definitely opportunities, like in the grid enhancing technology case to use incentives to reward utilities. And they are the economic regulator. So they have the ability to penalize utilities and say you get less rate of return if you don't do these things. So there's opportunity there. I don't think there's like a great proposal for how to kind of do that across their whole set of operations.I think there's some very narrow, tailored approaches for that. But again, FERC would have to do that in another proceeding.David RobertsJust say a little bit about how, say, FERC took this to heart, implemented this rule with these requirements for a better planning process, guidance on the cost allocation, and then this more active governance and oversight. Describe a little bit how that would look to you. What would you like to see in your dream world? What would a more active FERC look like? What would that involve? A more vigorous oversight from FERC.Rob GramlichSo let's take any region, I mean, the Midwest — MISO is the RTO there. They're doing a lot of this now, as is California, which is they look out at 20 years. They estimate generation, additions and retirements and load growth. They might do a scenario on electrification, like are we going to have a high EV deployment in this region or lower middle? And they'll put all that together and this can happen in any region.David RobertsMISO is actually one of the better — like MISO is a leader, right?Rob GramlichThey're doing a lot of this now. Yeah, MISO and California ISO are doing a fair amount. Some other regions have done some things lately. New York has done some things lately, and they're all talking about doing it partly just because FERC is driving this. And you know how, and you've talked about this many times about the two terawatts of generation in the interconnection queue. So this proposal is not about necessarily saying, let's take every proposed generator that anybody ever imagined and plan for that — because we're not going to get two terawatts by 2030 or whatever.So it's really more like start with kind of from a consumer standpoint or a load serving entity standpoint of what is needed to serve that load with the types of resources they say they want or their law says they need, and let's kind of work from that. So you make a reasonable, just objective estimate of the new generation, the retired generation, the expanded load, and those are the main factors. And then you take that set of inputs and give them to the transmission planners and say, "okay, transmission planning engineers, plan me the most efficient, reliable grid based on all that" — planning engineers, they know exactly what to do with that. That's not hard for them.Granted, they haven't been doing it for very long, and the people who did that retired ten years ago. So there's a little bit of a human resource challenge there. But generally they know how to do that. And that's essentially the vision, which, consistent with everything we've talked about here, really isn't rocket science. It's just planning for the future. And then get the transmission experts to say the right transmission grid for that future. And then what is the FERC — you're asking about the FERC role here? So FERC can kind of say, "hey, wait a minute, you didn't actually factor in these factors."Or parties can appeal to FERC and say, "wait a minute, my state has this policy," or "all of the consumers are saying they're buying this much energy. Or the load serving entities have sort of testified here or provided information about the resource mix they're going to be utilizing based on their, whatever it is, their utility targets. And you haven't factored that in." — regional planning entity. So then FERC can say, "hey, regional planning entity, do that, put all that in there." And that's how they — you know, they're not directing the outcome. They're not saying, "you need a DC line from over here to over there", but they're saying "you didn't follow the practice that we required."David RobertsRight. And I should just say, by background, I mean, maybe listeners already understand this, but the sort of background here is that the Federal Power Act requires utilities to set just and reasonable rates. That's sort of the engine of all this. The idea here is that if you're not doing this planning process in a rational way, then the resultant rates you decide on will not be just and reasonable. So, if you're reasonable, you would do these things. That's kind of the driver in the background.Rob GramlichExactly right. Exactly right. And that's a good point to kind of highlight the cost-benefit issue here, which is transmission is not cheap. Right? Nobody's claiming it's cheap. Sure, there's technology, ways to get a cheaper portfolio, but none of it's free. But the thing is, for just and reasonable rates, if you really look at it, we're actually doing things the most expensive way possible right now.David RobertsRight. Which is not reasonable.Rob GramlichRight. Which is not reasonable or just for anybody. A lot of consumer groups are saying this now to FERC, which is that, "hey, look, maybe we'd even prefer zero be spent on anything. But the reality is we're spending money on each incremental request that comes in, both on the generation and the load side, and then we're serving that need in only that need, the minimum required to serve that need. Well, it turns out with an industry that has massive economies of scale, you're necessarily doing something that costs way more per delivered megawatt than if you plan just a little bit ahead.And at the scale, like maybe the 230 kV line should be a 345 kV line or a 500 or 765. We got to call a stop to the current practice. Just can't keep doing things —"David RobertsThat's kind of the root of FERC's authority here is that the current practice is not just and reasonable.Rob GramlichThat's right.David RobertsOne other thing, which I probably should have covered up front, but let's just say a quick word about now. I think listeners know that our electricity system in its wisdom is sort of split. There's these restructured regions that have wholesale power markets and that are governed — where the transmission is governed by these regional bodies, RTOs. But then there's this other half of the country, notably the South and the West, the Southeast and the West, which are not wholesale power markets and do not have regional transmission organizations. Does all this apply to those regions just as well?And if so, who does it apply to? Who does regional planning in a region that's just balkanized utilities? Who do all these requirements apply to in those areas?Rob GramlichYeah, it does apply to all regions. And there are regional planning entities even in the regions without regional transmission organizations that were set up under Order 1000 in 2011. So, for example, there's Northern Grid and WestConnect out in the West. So it's not clear what the final rule will say. It could be those groups or they could allow different groups to do it. But it is important for this to cover the entire country.David RobertsRight. And let's just say, although, as you say, this is in a completely different pod, but let's just say it would be sure be convenient if the Southeast and the West would just get their s**t together and form regional power markets and RTOs of their own so that at least we could have consistent entities across the country when we're trying to regulate things. So just to sort of review here, there's this upcoming FERC rule. It's been proposed. It's going to be finalized soon, ideally and likely finalized in a FERC with three commissioners, two of which are Democrats.It's going to require a better planning process, better cost allocation, and it's going to boost FERC's sort of authority and oversight. That is, this rule will do those things if these recommendations are accepted and taken to heart. So maybe actually two final questions, I should never say final question. Who's the really decision maker here? What's the sort of political valence of all this in terms of the commissioners? All of this sounds so obvious and sensible in such a way that it's difficult to kind of imagine who doesn't want this? Who doesn't want sane regional planning that takes a holistic view, et cetera, et cetera.So what's the resistance here? Who needs to be persuaded on the commission?Rob GramlichChairman Phillips is the leader of the commission and on the timing and the substance, and he's going to work with his colleagues to make all the final policy calls and all the things. So he's the primary person here, and he wants to do this. He's been consistent in his public statements and his comments in the Oversight Committee hearings in Energy and Commerce and Senate Energy about this, that this is a priority for him, and I believe it is. But there's just a lot of details in here. There are powerful entities that don't want FERC rules on things.They might be utilities or they might be incumbent generators or others, and the commissioners all hear from them. And like, everybody's a little bit nervous about spending too much money because everybody wants low electricity rates. So in that uncertainty about exactly how much transmission is needed and where, I think there's a lot of room for parties to push the commission in different directions and for commissioners to say, well, yes to this and no to that. So this is so important to get right. I get nervous about those details. But all the things we've discussed on this podcast, these are the high-level things that really are important.And that would, I would just think, I mean, any average person on the street would think, "of course they got to do those things."David RobertsNot that complicated. It's just like any planning, that's what planning is, right?Rob GramlichThat's what planning is. And yeah, I don't know if you had radical ideas about how you would do networks without the need to plan and just wanted all like market-based system without regulations, who knows? But the industry, this is an interconnected, large, regional, multistate network.David RobertsJust iconically network. And all the things, all the sort of design principles that apply to networks apply here, really iconic form. And I can sort of imagine individual entities with narrow pecuniary interest in stopping this. But I can't imagine a sort of like public interest argument against, like, I can sort of imagine a utility saying, "this will reduce our profits some," but I can't even conceive of what the kind of public interest argument against this stuff is.Rob GramlichWell, remember, this is happening in Washington. We're recording this right before a potential, another government shutdown. So getting basic things done —David RobertsOkay, a really final question. There's a lot to be said about this too, but just quickly sort of, it seems unlikely that any legislation is going to pass DC ever again of any kind, really, but especially transmission. It seems a little bit like this is getting, it shouldn't be, but it is getting a little bit polarized. It seems like it's getting to be more of a Democrat versus Republican thing, even though that makes no sense. Such is our politics. But are there in your sort of realist, if we're taking a purely realist perspective here, are there legislative things that could be done that have some glimmer of chance of having bipartisan support and actually getting through a divided Congress?And if those — what are those things?Rob GramlichYes, I do think there is some possibility for bipartisan action, and I think the Senate Energy Committee is thinking and taking seriously a lot of those things. I've had very encouraging conversations, many, many conversations with both Republicans and Democrats on the Senate Energy Committee. And the one area that I think resonates with everybody is the interregional case, which again, is not so much the subject of this rule. And partly the idea is, while FERC's doing the intraregional right now, but I think there's pretty broad recognition that in the interregional case, really across between these large areas of the country, the industry historically did not grow up with any way to get those types of lines built.David RobertsYeah. Can I just ask in that case, because everything we've discussed, I can see how it could be applied relatively straightforwardly to the interregional setting, with one exception, which is, what are the entities in question? What are the planning entities to whom all these rules apply in the interregional setting?Rob GramlichYeah, that's right. Applying a rule to many dozens of entities is hard to hold anyone accountable for not doing —David RobertsRight. Is there a prospect on the table of creating such entities, or would just this just be a matter of, like, RTOs cooperating with other RTOs, like interregionally? Who's doing that?Rob GramlichWell, yeah. So there's two main options there. First of all, it will be helpful to, I think if we get some kind of recognition that that is the need, this large interregional case, we'll see what happens.David RobertsThere's plenty of evidence at this point. I mean, the DOE itself had that gigantic report that showed the benefits of national network.Rob GramlichThat's right. So then there's two policy things to do about that. One is a process like require — you could have legislation directing FERC to set up a process with many of the same planning practices we've just discussed and apply them in the interregional case, recognizing that, who exactly is the regulated entity and who do you hold accountable for not doing it? That's not easy, but it's not totally unfamiliar to FERC either. So that's one thing is a process requirement. Another is a minimum transmission capacity requirement between the regions. Just say, well, we don't necessarily know the optimum level, but let's just make sure we have a minimum level and set that level at some percentage.David RobertsBetween regions?Rob GramlichBetween regions. Right. And they do that actually in Europe.David RobertsWasn't that on the table recently or developed recently? I feel like I heard about that in the background.Rob GramlichYeah, exactly. A lot of people probably heard about that in the context of the debt ceiling deal back in late spring, or —David RobertsIt didn't happen.Rob GramlichYeah, it kind of had a glimmer of hope and it sort of had some bipartisan support. So it almost got in there.David RobertsAnd then it got summarily executed, I think, by utilities in their Republican catspaws.Rob GramlichNo comments. The fingerprints were removed, but yeah, it just turned into a report, unfortunately. But there was this big wires bill that Senator Hickenlooper and Representative Peters had introduced in their respective chambers, and that still is kicking around. It's got the bill, the idea, anyway, has a lot of support from a lot of stakeholders. So that's another possibility. Some version of that.David RobertsOkay, well, we're overtime, and this has been so fascinating. So, this is something that has come up on Volts over and over again. The need for more planning. I mean, not just in transmission, but just like, it feels like every topic I get into, you pull the string long enough, you end up in two places. One, utilities are screwing everything up, and two, we need better planning. I feel like those are the themes I end up no matter what topic I take on. So this is an opportunity here, right in front of us to do better planning.So I know people don't necessarily pay a lot of attention to FERC on a day to day basis, but this is like "rubber hits the road" time right now. So it's really important, I think, that people tune into this and do what they can to encourage FERC to go big here and to do well by this rule. By the way, is there anything like an average listener, it all seems so distant, is there anything average people can do to poke or prod FERC to do well here?Rob GramlichFor those who might have a way to engage at the state level or the regional level, that's important. No transmission really moves forward without strong support in the region. And so governors can be influential, encouraging governors to get supportive of this. I think that type of thing is useful. Even state legislators are weighing in. The National Caucus of state legislators, about 200 of them wrote a letter to FERC. So there are sort of indirect ways to encourage FERC or to encourage the regional planning entity in the region or encourage the governor or others involved in those processes to get on board with the agenda.David RobertsAll right, we will leave it there. Rob, thanks for coming on and walking through this with us. It's funny when I get into these topics that seem sort of like forbiddingly technical from the outside, and then you dig in a little bit and it's like FERC wants regional planners to plan. It's like, that's not really — turns out it wasn't that technical.Rob GramlichNow you know, and it's not that hard.David RobertsAll right, thanks a lot, Rob.Rob GramlichGreat to be with you, David. Thanks.David RobertsThank you for listening to the Volts podcast. It is ad-free, powered entirely by listeners like you. If you value conversations like this, please consider becoming a paid Volts subscriber at volts.wtf. Yes, that's volts.wtf. So that I can continue doing this work. Thank you so much and I'll see you next time. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

As I previewed for Volts subscribers a few weeks ago, I attended the third annual Yale Clean Energy Conference last week. It was a blast! It’s always energizing (pardon the pun) to be surrounded by so many young people doing so much cool stuff. It gives this crusty old blogger some hope.While I was there, I recorded a podcast — live on stage! — with Sonia Aggarwal.Sonia is well-known in Energy World. She co-founded (with previous Volts guest Hal Harvey) the energy policy think tank Energy Innovation, where she worked for years before heading into the Biden administration as the (deep breath) special assistant to the president for climate policy, innovation, and deployment.She recently reemerged from the belly of that beast and is now back running Energy Innovation. I chatted with her about her experiences in the administration, what policymaking looks like close up, what she’s proud of getting into law, and what gaps remain in US energy policy. It was super-fun.Thanks to Sonia, thanks to the kind folks at Yale, and thanks to all of y’all for listening. Enjoy. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

In this episode, Ólafur Teitur Guðnason of Icelandic company Carbfix discusses his company’s approach to carbon sequestration by essentially making fizzy water and burying it deep underground. (PDF transcript)(Active transcript)Text transcript:David RobertsThe idea behind the Icelandic company Carbfix is simple: pack water full of carbon dioxide (literally carbonate it, like a SodaStream) and inject it deep underground into Iceland’s porous basaltic rock. Minerals in the rock dissolve in the water, where they react with the CO2 to become calcium carbonates. The carbon effectively becomes rock, which it will remain, for all intents and purposes, permanently. Or at least thousands and thousands of years. It is as long-term as carbon sequestration gets.The idea dates back to 2006, but pilot injections didn’t begin until 2013 and it wasn’t until 2016 that a study published in Science confirmed that 95 percent of the CO2 in the water was mineralizing within two years — far faster than most had assumed possible. Since it started, Carbfix has sequestered almost 100,000 metric tons of CO2 at its original site, but that is just a drop in the bucket compared to what it believes is possible. It has plans to make Iceland a major international carbon-burial hub and to replicate its technology in other geographies, maybe even in the shallow ocean. When I visited the Carbfix operation in October and saw it in action, I was extremely intrigued and had a million more questions, so last week I got in touch with Ólafur Teitur Guðnason, Carbfix’s head of communications, to talk about where the company gets the CO2 it buries, where it plans to get it in the future, whether burial can work in other kinds of rocks and geographies, and exactly how much carbon Iceland can store.All right, then, with no further ado, Ólafur Teitur Guðnason of Carbfix. Welcome to Volts. Thank you so much for coming.Ólafur Teitur GuðnasonThank you so much for having me.David RobertsSo, Ólafur, I visited you guys when I was out in Iceland a few weeks ago and was very taken with this idea. And I don't know how I have been covering this stuff for so long without ever hearing about it, but it sounds like you guys are sort of on the verge of expanding. So I think probably a lot more people are going to be hearing about you soon. So to begin with, for listeners who are not familiar with your company, I'm going to run through the process and tell me if I get anything wrong. So you get a source of water, and we can discuss the source of water more later.But you get water, you carbonate it more or less like a SodaStream carbonates water. You pump carbon dioxide into the water, and then you pump the water deep underground. And this carbonated water is heavier than normal water, so it tends to sink down to the bottom of the water table. And as it is sinking, the carbon dioxide in the water reacts with minerals in the rock to form calcium carbonates. Basically, the carbon dioxide in the water gets transformed into a form of rock, where it will then stay underground as rock for thousands of years. So you've permanently sequestered the carbon.Is that more or less an accurate description?Ólafur Teitur GuðnasonIt's more than more or less accurate, I think. I'll give you a ten out of ten.David RobertsExcellent. Good. Well, I have so many questions about this, but the one thing I wanted to start with is the carbonation process of the water. Is that your intellectual property here? Is that your sort of main thing that you've pioneered here as a different way of carbonating water, or is there something special about the way you carbonate water?Ólafur Teitur GuðnasonYeah, that's one part of it. There are several elements to what we feel is proprietary or what we have solved — technology that we have developed. One thing is the capture of the CO2 emissions from the geothermal power plant, where we were kind of born as a research project within the company that runs the geothermal power plant, as well as universities both in Iceland and the US and France. So that is one element, yes. The dissolving of the CO2 with the water is another element, and the third element would be the way to inject it. So, yeah, there are different elements to this and at different stages of patenting.David RobertsOh, I didn't realize that you were involved in the capture part of this. I knew that part of the CO2 that you're burying is coming from the geothermal plant, but I had kind of thought that was separate. Is this something that you're going to export if you try to export this model to other places or other countries? Is capture part of what you're promising, or are you mostly, do you think, going to be working with CO2 that someone else captured?Ólafur Teitur GuðnasonYes, mostly. Capturing is not our core field. It just comes from the fact that we were born out of this proximity to the geothermal power plant, so we needed a source of CO2, and we may, and have and are collaborating with other companies that run geothermal power plants, so our know-how is of use in that situation. But we are definitely not primarily a capturing company. There are other companies that focus on the capture part, and that has different technologies for different streams of CO2. So we're not too involved in that. We are mainly and primarily focused on getting it into the ground and mineralizing it and storing it.David RobertsSo then when you carbonate the water, the physics of it, is it basically the same thing that's going on in a soda stream? Is there anything fancy going on, or is this just the carbonization that we're all familiar with?Ólafur Teitur GuðnasonIt's not too different, in essence. We have a stream of CO2, and then we shower it with water and pressurize so that it is completely dissolved. The difference is that we don't have the bubbles that you have in the soda stream or the soda drinks, mineral water that you drink, because these bubbles, they mean that the gas is escaping the fluid, so we don't want it to escape. So we are putting more of it into the water and making sure it's completely dissolved so that it doesn't rise back to the surface. And pressure takes care of that as well, as it continues to ensure this trapping mechanism underground as well when the solution gets into the ground.So solubility trapping, as it's called, is kind of the first stage of trapping and isolating the CO2 from the surroundings or from the atmosphere. It's a pretty secure way of trapping CO2. But then, fairly soon, mineralization comes into play, as well as the second stage, and even more secure.David RobertsYou know, when people think about what is basically a geological process of a gas being transformed into a stable mineral. I think of geological time frames. But your mineralization process, by which the CO2 is pulled out of the water and becomes rock, happens in two years, you say. Two years of the water being underground, all of the CO2 will be pulled out of it and mineralized. So how is that happening so fast?Ólafur Teitur GuðnasonWell, you need favorable conditions. You need favorable rock formations that are highly porous and reactive. It was quite a surprise when the scientific studies showed the extent and speed of the mineralization. So that was indeed surprising to the scientists at the time. A lot of it actually happens even sooner. So the process starts very soon, within a few weeks. And when we're talking about within two years, that is when almost all of it has mineralized. But it doesn't wait for two years, and then suddenly everything mineralizes, it starts sooner. So it's a very rapid process. Yeah, and that was a surprising finding, and that got a lot of attention back in 2016 when the results were published internationally.David RobertsYeah, right. We should mention that this is not a new thing. You guys have been doing this for ten years now, have you been — ?Ólafur Teitur GuðnasonYeah, eleven years. Celebrated ten years of continuous mineralization last year and counting.David RobertsSo there's been plenty of testing and monitoring?Ólafur Teitur GuðnasonAbsolutely. The idea was born in 2007, and this research collaboration started designing the way to capture, to dissolve the CO2 in the water to get it into the ground, drill testing holes, make mistakes, and so on and so forth. But the first successful pilot injections took place in 2012, so that was only five years after the project really started as an idea on paper. So a fairly quick progress there. And since then, we have continuously applied this method to sequester emissions from the geothermal power plant. Now we have also added a second source of CO2, which is captured from the atmosphere by our partners at Swiss company Climeworks.David RobertsWhen you say the rock needs to be reactive, what does that mean exactly? It just needs to contain the minerals with which the CO2 is going to react?Ólafur Teitur GuðnasonYeah, it has to be rich in those minerals or metals, iron, magnesium, calcium, that tend to come out of the rock, if we can say — I'm looking for the right word in English — they get dissolved, they get into the water, and then react with the CO2 to form these new minerals. So we are really dependent on those types of sometimes called mafic or ultramafic rocks. We are working primarily with basalts in Iceland. So it's a young volcanic rock that contains high levels of these metals, about a quarter of the weight. So they have the ingredients needed to form the minerals.By the way, important to mention that this happens in nature over geologic timescales. It's one of the reasons why over 99% of all the carbon on the planet is already underground in rocks. So even though we have a crisis on our hands, it's less than 1% of the planet or Earth's carbon that is in the atmosphere and oceans and biomaterials. So, yeah, we can say it's nature's way, that we have found a way to accelerate.David RobertsAnd so when this mineralization happens, it becomes rock that is, for all intents and purposes, permanent. There's nothing that could reverse that process.Ólafur Teitur GuðnasonRight. There is a debate on what counts as permanent in the climate debate. Is it 100 years? Is it 1,000 years? Is it 10,000 years? But we are definitely above all of those and into the tens of thousands of years. So even millions of years.David RobertsInteresting. Okay, so it says on your website that you have to date buried 97,000 metric tons of CO2. So I want to ask a few questions about the capacity of the land to absorb this. So you have said, I remember you said it was very striking, and I remembered it afterwards, when I came to visit that the amount of porous reactive rock in the Iceland sort of bedrock in and of itself could store all the CO2 that humans emit. Is that accurate?Ólafur Teitur GuðnasonYeah, it's even when we expand on that thought and say all of the CO2 that would result from burning all remaining fossil fuels on the planet.David RobertsNo kidding.Ólafur Teitur GuðnasonAnd that's Iceland alone. But that is a theoretical figure, not something that anyone is contemplating.David RobertsSo theoretically, there's almost no upper limit to the amount of CO2 you could store in here, but I presume there are practical limits? So, like, say, in a particular injection well, you're pumping water down and the CO2 is reacting and becoming a rock and filling in those holes. The rock is porous, it's full of holes. The rock is filling in those holes bit by bit. So I wonder, in a particular injection well, do you reach saturation in a particular area? Like, is that a limit on your pace here?Ólafur Teitur GuðnasonWell, in the end, we assume we will. But for the decade that we have been operating the same well, we are not even close to it. One of the signs would be that the well would become less receptive to the water flowing in. But that is not happening. So we don't really know exactly how long one well can last. But we do know that for the ten years that we have been operating, admittedly on a fairly small scale, but nevertheless, for a decade and close to 100,000 tons, we estimated that we have used less than 0.01% of the capacity of this area where we are operating.David RobertsThis particular well, so there's tons more headroom even in this individual well?Ólafur Teitur GuðnasonYes, absolutely. The empty space in the rock has such a huge volume and we are depending on the empty space. In the first instance, we are depending on it for the permeability of the rock, for the water to be able to flow through, and then for a part of this empty space, a small part of it to hold the newly formed mineral that consists of the former CO2. As a rule of thumb, if your listeners are interested, a cubic meter of basaltic rock could hold approximately 100 kg. I'm using the metric system, excuse me. So 100 kg in a cubic meter as a rule of thumb.And it is hard to wrap your head around how many cubic meters of rock there are underground. When you go deep, when you have a sizable area, these very quickly amount to huge amounts.David RobertsRight. So space for the carbon is not a limiting factor?Ólafur Teitur GuðnasonNo.David RobertsI'm wondering, as you scale up, if more and more CO2 is coming to you. I'm trying to figure out what the practical limiting features are here. Is there at a certain point you max out your flow, like at a certain point you're going to max out the amount you can carbonate at a time. Right. There's presumably limits on the flow of water that you can pump.Ólafur Teitur GuðnasonIt depends on the number of wells you have. If you need more flow, you can add wells. You just need to have a reasonable space between them because each well is only using so much underground area. So you can have another one 300ft away or 500ft away or something like that. So scaling up means really adding more wells, provided you have the appropriate conditions there as well. I would say a major limiting factor is the access to CO2 that has been captured.David RobertsRight.Ólafur Teitur GuðnasonSo the problem is not really storing it, the problem is getting it in the first place and getting it not only capturing it from emitters, but then also transporting it to a suitable storage site.David RobertsYour only limiting factor is how much CO2 you can get your hands on. Practically speaking, there's no limit to the speed and quantity that you could handle if you can solve the problem of getting it to you, basically.Ólafur Teitur GuðnasonYeah. And I would also mention that, of course, we need water for this process, so there has to be access to water as well.David RobertsYes, I want to ask about that later too, but I want to start with energy though, because a bunch of people, I was talking about this on Twitter, this is the first question people have, which is sort of how much energy are we using to do this? And presumably, the energy you use to do it needs to be zero carbon, or else you're just sort of like in a loop of creating carbon to bury carbon. So this is all premised on zero carbon energy, right?Ólafur Teitur GuðnasonYes, preferably. Or at least you need to be — well, in Iceland, we don't really have that challenge. All of the energy is either geothermal or hydropower. So it is green energy, definitely. But still there is the question of displacing green energy for the purpose of carbon capture. And it's a whole debate on that, or at least some points to be made. But yeah, I mean, how net positive do you need to be to be justified? That's an open question. But in our case, the energy is completely sustainable and it is a very low energy process.David RobertsCan you put numbers on that? Like, what do we mean by low energy?Ólafur Teitur GuðnasonIt is negligible. I mean, it is running of pumps. Pumping water doesn't require a lot of energy. So it is really almost invisible in the big picture.David RobertsTheoretically, then even if you are using whatever natural gas generated electricity to do this, do you think you still might come out positive just because you're —Ólafur Teitur GuðnasonOh, definitely.David Robertsjust because you're not using much energy.Ólafur Teitur GuðnasonYeah, it's so low compared to the amounts of CO2 that we are getting rid of, irrespective of the fuel or power source. It would be vastly net positive. But that's not the full value chain of course. You need the capturing, you may need the transport.David RobertsYes. Right.Ólafur Teitur GuðnasonAnd we will maybe come back to that. So we think for our biggest project that we are preparing — next big project in Iceland as well — transport will be most likely the major source of emissions to be then, of course, fully accounted for and deducted from the benefits that we are claiming to make.David RobertsRight. And so right now, you're getting your CO2 that you're burying from two sources. One is the geothermal power plant, which I think people think of geothermal as zero carbon. But it's not really zero carbon, there are —David RobertsNo, it's not zero. I think it's 1% of a coal fired plant, approximately, but still —David RobertsEnough to capture it. And the other source of CO2, which Volts listeners will be familiar with, is from Climeworks, this direct air capture facility just down the road from you. With the big fans that are pulling air over this absorbent that's pulling the CO2 out. Presumably they are compressing the CO2 and putting it in a pipeline that comes to you. Is that how it gets to you?Ólafur Teitur GuðnasonYeah, they currently get it to us in liquefied form, so compressed and liquefied. So they break it away from their filters — I'm not the best one to explain their technology — but basically it's filters that they then collect it from the filters and compress it and send it to us.David RobertsAnd how pure of a CO2 stream do you need for your process to work? Does it need to be super purified, or — is that a limit?Ólafur Teitur GuðnasonNot necessarily from the mineralization perspective, but from other environmental considerations.David RobertsRight.Ólafur Teitur GuðnasonI mean, the European Directive on Geological Storage of CO2 stipulates that you shouldn't dump other things in there along with the process. So you should have a pure stream of CO2. So I think that's mainly an environmental consideration that makes sense generally. But that wouldn't necessarily hurt our mineralization process too much.David RobertsAre there other emitted gases that we don't like that we could capture and bury and mineralize in this same way, or is this like a carbon only kind of thing?Ólafur Teitur GuðnasonHydrogen sulfite is emitted by geothermal power plants, comes from the ground, just as the CO2 does. And in fact, Carbfix was born as a twin project of Carbfix and Sulfix to take care of hydrogen sulfide, which is, you could accurately say that that is an even bigger threat to the local environment. It's dangerous in high concentrations and really a harmful gas. So that was among the key considerations, was to get rid of that as well. And as it happens, the same process applies.David RobertsIt works same way.Ólafur Teitur GuðnasonYeah. So we get rid of the hydrogen sulfide as well, literally improving the air quality of the vicinity of the geothermal power plant and co-inject it with the CO2, and the same mineralization process happens, producing another type of mineral. But —David RobertsOh, interesting.Ólafur Teitur Guðnasonthis is specific to geothermal power plants. So we are very much focusing on CO2.David RobertsLet's talk about then getting CO2, because if you're going to scale this process up to meaningful, sort of globally meaningful levels, the big limiter is your access to variable CO2. So it's easy enough to envision how this works in Iceland, where you have lots of geothermal power plants creating gases that at this point you're quite familiar with. You know the process. There's suitable rock nearby. Talk a little bit about the Coda terminal, because you guys have very big plans to import CO2 from other places and bury it. So how is that going to work and how is that going to pencil out in emissions terms?Because obviously shipping uses energy and produces emissions, compressing the CO2, et cetera, et cetera. There's energy all along the chain there. So talk a little bit about how you're thinking about how you're going to set up a system to import.Ólafur Teitur GuðnasonThe big question was where should Carbfix scale up to the megaton scale, get to a million tons or more, which is, that's the big milestone that's ahead. Because I should add maybe for context, just to back up a little bit for half a minute. It's true that our focus needs to be on eliminating the use of fossil fuels. So the criticism is often, "well, you're distracting us from that mission." And it's true, it's a moral hazard to use carbon capture storage as an excuse to continue with business as usual. But the fact of the matter is, and the IPCC said that very clearly in their report last year, we will not reach the climate goals.Even if we manage to do really well with the energy transition to green and renewable power, we will need to capture other emissions that will remain, that we know will remain. There are industries that have emissions that have nothing to do with energy. It's the part of the process of producing cement, steel, aluminium and so on and so forth, where even if they're powered by green energy, they still have the emissions, because the emissions are process emissions. So how do we take care of those as well?David RobertsYou could also say that even if we could cut off all emissions to zero tomorrow, you could argue that there's too much CO2 in the atmosphere already to be safe. So you need to draw some of that down, even if you're not emitting anything.Ólafur Teitur GuðnasonRight. So you need carbon capture, both from these hard to abate industries, which is the reduction of the remaining hard to abate emissions, and then drawing out of the atmosphere what we know as carbon removal. So the IPCC says in its report — anyone can look it up — even in their scenario, they have several pathways of how we could reach the climate targets. They have a pathway that is highly dependent on big successes in renewable energy. So it's called the high renewable pathway. Even under that assumption, they have calculated that by 2050, the annual amount of carbon capture storage will have to be 3 billion tons.David RobertsSo, that even makes looking like the million-ton milestone look pretty small.Ólafur Teitur GuðnasonThe global total today is about 40 million per year. So we need to go from 40 to 3 billion until 2050. So that's why we can feel, we can very confidently say we are a necessary complementary action in addition to other efforts.David RobertsSo, then it becomes the question of —Ólafur Teitur GuðnasonWhere do we scale up, how to move it around? And we decided that for scaling up and proving that we can do this on a megaton scale, it would be most feasible to do that in Iceland, where we are based, where we know the geology, where we know the legislative framework and so on and so forth.David RobertsIt does seem like ideal conditions for what you want to do.Ólafur Teitur GuðnasonYes, it's ideal, both from a geological perspective, resource perspective, and makes sense, because this is where we are and where we know best. But then the challenge is, well, we don't have millions of tons of CO2 in Iceland to inject into the ground. The total emissions of Iceland, excluding land use, is about 5.5 million, approximately. That's from cars and planes and ships and so on. You won't be able to catch that. Industries in Iceland are emitting a little bit over 2 million tons, I guess. So even if we could capture all of that, which is not feasible in the near future, we would not be really utilizing the potential that we have.So the idea with this project called Coda terminal is to be a transport and mineralization hub for mineralization of CO2. And this concept of a hub is really what is happening now, it seems, around the world, when it comes to geological storage, at least you have pockets or individual areas where you can geologically store CO2, but you need to have a network to get it there.David RobertsRight. The big question here is how often do you want to build the infrastructure to bury carbon, versus building the infrastructure to carry carbon to the places where that infrastructure already exists. Which of those is better, carbon-wise?Ólafur Teitur GuðnasonYeah, we won't be able to build a mineralization facility next to every factory or emitter, next to every cement plant, every steel plant. So that's just not feasible. The conditions are not there. So in any case, even though transporting to Iceland from Europe seems excessive, there will always need to be transport for whatever distances other big projects are looking at storing beneath the ocean floor in the North Sea that will have to be transported somehow — ships, pipelines, whatever. So I think there is a lot more focus on this now. How do we make sure that we have the infrastructure in terms of the Coda terminal there will be shipping from Europe.Of course, it has to get to the ship as well before that. There are discussions of pipelines. Can you use existing infrastructure to some extent? Possibly, probably. But you also need some new ones.David RobertsI think they're a little farther along in Europe in terms of CO2 pipelines, than in the US, is my understanding. Like there's an actual plan there.Ólafur Teitur GuðnasonThey are starting to at least look very seriously into it, and adopting new legislation to make sure that we have the framework about financing, access and so on and so forth. There is actually considerable existing infrastructure in the US connected to the oil industry that is piping CO2 over some distances as well. So it is a known concept. It's not inventing anything new, really, but on a larger scale. So the plan for the Coda terminal, is to be able to receive and mineralize 3 million tons every year as of 2031, when we plan to have reached full capacity.And some of that will come from Iceland, no doubt. We are working, collaborating. The Icelandic government and heavy industries in Iceland are collaborating with us to find ways to capture and store the emissions. We have several aluminium plants in Iceland using the green energy that we have a ferrosilicon plant as well.David RobertsIn Iceland, you can build one of these next to every factory.Ólafur Teitur GuðnasonConceivably. Well, one of the plants is in east of Iceland, where there are actually the least amount of basalts, but at least for several of them, it is very feasible. And, in fact, the Coda terminal will be built next to one of these plants. So it will be fairly straightforward, once the technology is there, to capture their emissions, to get it to us, because we will be located right next door, and also there is a harbor there for receiving ships from elsewhere. But this is definitely needed. The ships. If we assume that the ships would run on traditional fuels, we estimate that the emissions of shipping would be maybe approximately 7% of the CO2 that's being transported for storage.David RobertsSo significant, but not enough to wipe out the value, right?Ólafur Teitur GuðnasonDefinitely not. But then, of course, as soon as greener fuels become available for the shipping, those will be employed immediately as they become available.David RobertsSo ideally, these would be zero carbon ships carrying this stuff from Europe to you.Ólafur Teitur GuðnasonYeah. Or at least much lower than traditional fuels.David RobertsRight. Right. And this Coda terminal, is this a gleam in your eye? Are there plans, is there money set aside?How real is this plan for this big terminal?Ólafur Teitur GuðnasonIt's very real. It last year got funding from the European Innovation Fund for €115 million, give or take a third of the total cost. So it was deemed by the European Innovation Fund to be realistic, and the technological readiness level, as they say, is very high. As we have been operating this technology already, we're not inventing new things, we're scaling up what we already know. So the plans are in full motion to secure environmental impact assessments, permits, land and so forth and all moving along quite nicely.David RobertsIs the idea that Carbfix would sort of have direct contracts with big emitters in Europe, sort of direct contracts to off-take their CO2?Ólafur Teitur GuðnasonYes. The business case is, in part, and we could say probably the biggest part of the business case is the fact that Europe has a cap on emissions from industries. So the European trading, emission trading system, ETS, is the driver for companies to take care of their emissions. So those who know how the system works will know that you get a certain amount of free allowances, and it's a total cap on the continent. The free allowances are reduced gradually, year on year, creating a kind of pressure on industries to improve. And since the emission allowances are quite expensive, there is a significant incentive to take care of it, otherwise capture it and store it.And the regulatory framework says, if you capture it and store it in a regulated geological storage site that has the appropriate permits, then you don't need to purchase the emission allowances. So this is what creates the business case. And the flip side of that is the economy of our method, which is a very economical method indeed.David RobertsYeah. Is this, as far as, you know, the cheapest form of permanent storage?Ólafur Teitur GuðnasonI'm not sure I can say that with 100% certainty. But judging from the look on people's faces when we discuss the costs, I'm thinking that they must be. The mineralization cost itself is very low, less than $20 per ton or something.David RobertsI want to talk about water, but first, actually, I got a bunch of questions about land use. But I think we should just say that the land use needs of this are really quite small. I saw one of your little domes that you build to house the pumps, and it's just like a little yurt. Like it's relatively tiny. I guess you have to count the pipelines in some respect. But in terms of land use, that doesn't seem like a kind of limiting factor. You're not taking up a lot of space.Ólafur Teitur GuðnasonDefinitely not for a single well. And even with the Coda of terminal, where we will need many more wells, of course, spreading out over a significant area, the actual footprint of the actual infrastructure is quite small and can quite easily coexist with other industries, facilities. It's not a delicate operation. It doesn't emit noise, vibration, emissions. So I think I would happily live next door to one of these injection wells.David RobertsYeah, like I could tuck one of those in my backyard. They're even kind of cute.Ólafur Teitur GuðnasonIt can easily cohabit with other industries, no question.David RobertsSo right now, because you are in this symbiotic relationship with the geothermal plant, insofar as you build next to geothermal plants, you don't really have to worry about water, because geothermal plants bring water up and then they pump water back down. So all you're doing is kind of inserting yourself and adding one additional step in that process. But the water loop is basically the same as for a normal geothermal plant. But I'm wondering, I have several questions about sort of the potential to do this in other places, in other contexts. If you didn't have a geothermal plant, how do you think about where to get water?And do you view that as kind of a limiting factor on where you can go and where you can establish one of these?Ólafur Teitur GuðnasonWe do need water to be there, but there are many places where you have access to groundwater. In fact, I read a report on groundwater in the US that said that it is an underutilized resource because it's only about 30% of the fresh water that is used in the United States is groundwater. The rest is surface water. So I think not everybody realizes the extent of water that is stored in the ground and for one reason or another, hasn't been extracted. It's certainly a precious resource. And that's why it's important to note that we are not competing with domestic uses of potable water. Definitely not going anywhere near those kinds of reservoirs. We do return the water into the ground, not having contaminated it in any way, added CO2 to it.David RobertsWhat you do to the water, does that render the water dangerous in any way? Like, can it mess up groundwater or can it pollute anything, or is there any risk to this carbonated water?Ólafur Teitur GuðnasonWell, it is mineralized water, mineral water. When you add carbon dioxide into water, it raises the acidity, so you don't want to mix it with the groundwater. And that's why we go much deeper with the injections, isolate the pipes from the surroundings and because, as you mentioned at the start of our talk, that once you have added the CO2 to the water, it's heavier than the water around it, it tends to sink and continue sinking.David RobertsSo you inject it below the groundwater that people are drinking —Ólafur Teitur GuðnasonAbsolutely.David Robertsand it sinks.Ólafur Teitur GuðnasonYeah.David RobertsSo theoretically, you could pump up the water yourself. I mean, presumably that would add a little bit of cost, but you could just pump up the water yourself out of the water table, carbonate it and pump it back down with no need for an external water source.Ólafur Teitur GuðnasonRight. Well, if the water is there at the site, yes, we, of course, need relevant permits and everything like that. But yes, the water use, because we are talking about fairly big amounts, it adds up and it's easy to calculate big numbers. I was actually looking into this a few days ago. What's the water footprint of products? And I found a website from, I guess it's an NGO that's concerned with water and water preservation and so forth. And it takes about three tons of water to make a hamburger if you calculate the life cycle of it. So, for us to take care of one ton of CO2 requires about the same amount of water that it takes to make nine or ten hamburgers or two smartphones.David RobertsBut you're not really using up the water, right. You bring it up and you put it back down.Ólafur Teitur GuðnasonWe bring it up, put it back down. We do add the CO2. The CO2 then gets released from the water again as it mineralizes. So then the water is free of the CO2 that we added to it and it goes on its way.David RobertsYeah.David RobertsSo it seems like in terms of large scale hydrological systems, you basically have very little effect. You're just kind of inserting yourself in the middle of a process that's already happening. But you're not net subtracting water.Ólafur Teitur GuðnasonWell, it depends on where you take the water and where you put it. Do you return it to the same place as where you took it? So that will be different from site to site and will need to be assessed. I would not be comfortable saying, well, we don't have any effect at all. I think that wouldn't be fair. So it is something that needs to be looked at, investigated, analyzed properly, to make sure that we are not affecting. When you extract water from one place, you can affect the hydrology of surrounding area and so on and so forth.But I would not say it's a zero concern, but I would definitely say that with the proper designs, we can make it entirely safe.David RobertsWell, one almost inexhaustible source of water is the ocean, which is sitting right next to you there in Iceland. So I wonder, what about the prospect of carbonating ocean water and injecting it underground? Because if you could do that, then you have all the water you could ever want in the world. Is this something you have been thinking about or trying to do?Ólafur Teitur GuðnasonMost certainly. We, a few years ago, started to look into this very heavily. We have already demonstrated in controlled conditions in the laboratory of the University of Iceland that the physics work dissolving CO2 in seawater, exposing it to the appropriate rocks, produces this mineralization process in much the same way as using freshwater does.David RobertsIs there any reduction in performance or anything, or does it work just as well?Ólafur Teitur GuðnasonIt more or less works well, yes. I'm not sure exactly about the details of the differences, whether you can dissolve as much or more even, or what the effects are exactly. But what I do know is that once you leave the controlled conditions of the lab and go into the field, you tend to run into unexpected things. And that's precisely why we have actually started — just a few days ago, we finally injected the first CO2 that was dissolved in seawater below the ocean floor using seawater. So the installation is at the shore. It's not offshore; it's close to the shore.So we are extracting seawater and then pumping it or injecting it under the seabed.David RobertsAnd this is like the shallow coastal seabed, right?Ólafur Teitur GuðnasonYes, but we always go a few hundred meters down into the ground and below it. So, yeah, that was a milestone for us that we have been celebrating for the last couple of days at the company, because it has such potential to be a game changer in terms of opening up new geographies, new areas where it might otherwise not be feasible.David RobertsRight. And definitely removes any worries about the availability of water.Ólafur Teitur GuðnasonYeah, absolutely.David RobertsAt that point, you've got all the world's oceans full of water. Right now. You are, as we've been sort of discussing, in what might as well have been cooked up in a laboratory to be the perfect circumstances for this. You've got the geothermal there, you've got cheap carbon free power to run it on. You've got the perfect porous, young basalt rock. Almost unlimited space down there to use, so this — Iceland is ideal for this. Have you tried to do this with other kinds of rock and other kinds of geology in other countries?Ólafur Teitur GuðnasonWe have done two small test projects abroad, so we have injected small amounts in Germany and in Turkey. Those were kind of research pilot projects, not really intended to become huge projects, more of a scientific exercise. We are looking into several locations abroad at various stages of discussion, possibly development. Basalt is actually quite common. It covers about 5% of the land mass.David RobertsOh, really?Ólafur Teitur GuðnasonYeah. So it's not only in Iceland, but it tends to be young and favorable basalt in Iceland; also, the ocean floor, the majority is basalt. So that also is about what we're discussing earlier. So there are several locations, but I could mention also the US. We have been awarded three rather than four, I think it's three grants from the US Department of Energy to study the potential of our method in the US.David RobertsInteresting. Where would that be?David RobertsWhat kind of rock would that be?Ólafur Teitur GuðnasonWell, it's basalt in the Pacific Northwest, so two projects there. And I should note that we are in collaboration with many other parties collaborating on these projects. So it's not just us, it's the Rocky Mountain Institute, the University of Wyoming and others, and others, Pacific Northwest National Labs and other partners that are collaborating on a couple of projects in the Pacific Northwest. And those have to do with basalt because there are huge basalt in that area. And then in Minnesota, we also have a feasibility study that we are going to do in collaboration with others as well, to check whether our method can be applied there in a slightly different form of rock formations.David RobertsIs there a general way to characterize what sort of geology you need? I mean, is it basalt specific, or is it just, you need porous rock, rock with a lot of these minerals in it? Are there other kinds of rock that have these features?Ólafur Teitur GuðnasonYeah, like I said, they are similar to basalt. These mafic and ultramafic rocks, which have the large amounts of the metals that we discussed, need to be there. The porosity can vary — for our approach it needs to be there to some extent.David RobertsRight.Ólafur Teitur GuðnasonAnd we know that there are other companies looking into different types of rocks that are maybe less permeable but have also potential storage capacity. So those will bring different challenges, I guess, that we are not qualified to explain fully. But at least this natural tendency and capability of rocks to store CO2 is something that is catching a lot of attention. And to my knowledge, I think I can safely say that we are the only ones actually applying it today, at least on a commercial basis.David RobertsSo it's still somewhat of an open book here. We still don't have a great idea of the full extent of types of rock that could be used here.Ólafur Teitur GuðnasonYeah, you're right. And I forgot to mention that we also got, in collaboration with scientists in Scotland, a public fund there, to also look into potentials there. I believe those are also slightly different rock types. So there is a lot of research going on and what we have to balance is to move our projects along that are based on what we know and at the same time to expand, improve and do research and development as we need to do to scale these things up. But we are quite satisfied with the project pipeline that we have already and the R&D pipeline.So we are around 43 people today. We were 15 when I started 18 months ago. We are changing fast.David RobertsIt's the right thing at the right time. Seems like there's no shortage of CO2 out there looking for places to be buried.Ólafur Teitur GuðnasonYeah, that's right.David RobertsIn terms of sort of accounting, just to take your current setup. If Climeworks captures a ton of CO2, sends it to you and you bury it, who gets the carbon credit? Who gets to sell the carbon credit there? Who gets to sort of claim to be the entity that dealt with the carbon?Ólafur Teitur GuðnasonYeah, well, that's a matter of negotiation. Under the current setup, Climeworks sells the credits to customers such as Microsoft and others. So we are providing the storage as a service. Potentially we could have a different setup where we would split those credits somehow. We were not really there at the moment.David RobertsSo that's not totally settled yet, how that's going to work?Ólafur Teitur GuðnasonFor the current setup it is definitely. But what may happen in the future potentially we also have collaborations with other direct air capture companies. So what the setup will be when those come online, we'll have to see. One fascinating question from my perspective is also the interplay of corporate accounting and national accounting.David RobertsYes, we addressed that on an episode of this very pod a few weeks ago.Ólafur Teitur GuðnasonI'll have to listen to that.David RobertsIt's a puzzle.Ólafur Teitur GuðnasonYeah. Because there is some criticism that, for example, a particular project in Denmark, where Denmark is going to count the storage project against its national targets and the credits are also sold to a private company in another country.David RobertsI think it's Microsoft, actually. I think we discussed that very case.Ólafur Teitur GuðnasonYeah. So some people call that double claiming, double counting others, and I'm a bit fond of that argument, which is that this is co-claiming where you shouldn't confuse national accounts with corporate accounts. It's two entirely different systems. So you do have countries, for example, publishing figures on employment, and then you have companies publishing exactly the same figures and one is an aggregate of the other. So you're not double counting the jobs, you're just counting them in two different. You have them in the annual report of this company and then you have them in the national economic figures of the country.So I don't think really there is necessarily a problem there as long as there are not two companies claiming the same results.David RobertsRight. Well, there's still puzzles though, because, say, in the private accounting scheme, whatever, Climeworks gets the credit and shares a little bit of it with you, that's the private thing. But for publicly, if emissions are captured in, I don't know, Germany liquefied, shipped to Iceland and buried in Iceland, is that a reduction in Germany's emissions? Does Iceland get to claim anything?Ólafur Teitur GuðnasonWell, what is, and what should be? My understanding is that under the current rules, it would be an emission reduction in Germany. Because you count at the smokestack, so to say.David RobertsRight.Ólafur Teitur GuðnasonAnd that's the same logic. The current climate accounting is you count the emissions where they happen.David RobertsRight.Ólafur Teitur GuðnasonYou could do it otherwise. You could, for example, have consumption based accounting where Iceland would have to — well, we import cars, we don't produce any cars.David RobertsRight.Ólafur Teitur GuðnasonThe case could be made that to be fair, we should be acknowledging the carbon footprint of those cars —David RobertsThe embedded emissions I think they are called.Ólafur Teitur GuðnasonYes. And at the same time, we are having in Iceland to acknowledge or bear the burden, so to speak, of having three aluminium plants. We are producing aluminium for 3% of the world's production, many hundreds of times more than what we need. We could produce our own needs in like 10 seconds or something.David RobertsYeah. Right.Ólafur Teitur GuðnasonBecause we're such a small nation of 360,000 people and you could say it's unfair that we have to account for this. And as a result of this, we have some of the highest emissions per capita in the world. But that's because we are the aluminium factory of the world. That's not really fair, you could argue. So you could argue for a consumption based, but I guess it's just not practical. So you just count at the stack in the geography where the stack is located.David RobertsI mean, if you did do a consumption based accounting, you could see Iceland being like negative emissions many, many times over. You know if they become a hub for bearing stuff.Ólafur Teitur GuðnasonYeah, if you would count all the bearing in Iceland, then you could. Yeah, but at the same time, we do consume products and they have to be shipped here and so on. But the point I'm making is maybe that there is no single best way. You have to choose an approach. And it may not be perfect, but it has to be practical. We have this principle of just counting the geography. And by that logic, I guess if emissions are reduced in a certain location, that location needs to be credited. And even though it seems a bit unfair that the country storing it doesn't get the credit, because if you couldn't store it, then what would you do with it?Personally, I feel that it is worth discussing at least whether we need for this to be recognized somehow, the contribution of countries that are storing, providing storage. Or is it simply the financial benefit of selling that service? Or should it be reflected in the climate national accounts? I mean, I don't really have a very strong opinion on it, but it's worth thinking about. And it's an interesting thought exercise.David RobertsYeah, it's quite a puzzle. You move one piece and a bunch of other pieces move.Ólafur Teitur GuðnasonYeah. I'm also sympathetic to the view that we mustn't get too caught up in bookkeeping. We need to get things done. So I don't want to give the impression that, well, Iceland will not store CO2 unless we get the credit. I mean, that's not really a very sensible position, even though you may have interesting arguments about it. The pressing issue is to get things done and not to get stuck in these details. With all due respect to proper accounting and everything, of course it has to be in place. But let's not get distracted from the task, which is to get some progress and scale up our efforts.David RobertsFor sure. One of the things that really captured my attention and my imagination —Ólafur Teitur GuðnasonNo pun intended?David Robertsexactly! Captured, but did not bury my attention and imagination, here is just how simple this whole thing is. There's no piece of this that is particularly obscure or technical, more than an ordinary person could understand. So I wonder, are there places in this process where you can foresee substantial performance improvements or innovations? Like where could you improve the performance of this process? Or is it so simple that it just is what it is, and you might get some economies of scale, but the process itself just is what it is. Or is there room here to sort of improve the performance of this?Ólafur Teitur GuðnasonYeah, absolutely. We are continuously doing that. I'm not sure that there will be an order of magnitude improvements in efficiency, but we are definitely working to use our resources more efficiently, use less water, and increase the capture efficiency from geothermal power plants. That was a big breakthrough that we had. So we have designed new capturing equipment.David RobertsOh, interesting.Ólafur Teitur GuðnasonWe've designed a mobile injection system that enables us to go into areas for test injections with much less effort than before. The seawater tests, of course, would be, if those are successful, a game changer. But you are right, I think it's more apart from the seawater, which is really a big shift, it's more honing and fine tuning, but definitely going after every bit of improvement that we can identify.David RobertsAwesome. Well, this is so fascinating, Ólafur, thank you so much for coming on and talking us through it.Ólafur Teitur GuðnasonIt's been a pleasure.David RobertsI hope to see you up here in the Pacific Northwest before too long.Ólafur Teitur GuðnasonAbsolutely. Thank you for having me. It was a real pleasure.David RobertsThank you for listening to the Volts podcast. It is ad-free, powered entirely by listeners like you. If you value conversations like this, please consider becoming a paid Volts subscriber at volts.wtf. Yes, that's volts.wtf. So that I can continue doing this work. Thank you so much and I'll see you next time. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.volts.wtf/subscribe

Rural community pushback to new wind and solar farms has the potential to slow the US clean-energy transition, but very little research has been done on what rural Americans actually think about renewable energy. A recent survey of thousands of rural residents about their opinions on climate change and clean energy development sheds some light; in this episode, Robin Pressman of Embold Research and Mike Casey of clean-energy PR firm Tigercomm discuss the results.(PDF transcript)(Active transcript)Text transcript:David RobertsOf the handful of forces that have the potential to stymie the clean-energy transition in the US, perhaps the most immediate and dangerous is rural NIMBYism. Rural communities will, by necessity, host most of the wind and solar farms the US needs to decarbonize, but rural resistance is already responsible for dozens of canceled projects and growing delays.What do rural Americans think about renewable energy? Where are they getting their information and what sorts of arguments are getting through? There’s been weirdly little research on this question, despite the growing severity of the problem.Into that breach comes a new poll done by Embold Research, which surveyed thousands of rural residents to uncover their opinions on climate change, wind and solar power, and the promises of energy developers. The poll was commissioned by the clean-energy PR firm Tigercomm, which also interviewed community engagement staff at energy developers to find out what they’ve been hearing in the field.I contacted Mike Casey, the president of Tigercomm, and Robin Pressman, the head of Embold Research, to discuss what the poll found and what it means for clean energy developers engaging these communities.All right then, with no further ado, Mike Casey of Tigercomm and Robin Pressman of Embold Research. Welcome to Volts. Thank you both so much for coming.Robin PressmanThanks for having us.Mike CaseyThank you, Mr. Roberts.David RobertsMike, let's start with you. Let's just talk a little bit about the background here. There are kind of two bits of research here that we're going to discuss today. On the one hand, Robin's firm has done this polling of rural Americans. I hate that I'm going to have to say the word rural over and over again in this podcast. It's my least favorite word to say. But also, your firm has done a bunch of interviews with developers, renewable energy developers, specifically the people at the renewable energy developers who are responsible for going into these communities and developing these projects.It's sort of the advanced people who are going out to talk with the rural people and live in that world. And I'm interested in both those perspectives. But maybe actually, Robin, let's start with you. So, tell us a little bit about what this poll did, who it polled, and what kinds of things you were asking about.Robin PressmanSo, we wanted to take a look at your favorite word, "rural," Americans and understand perspectives on renewable energy. We've seen a lot of polls lately that look at the country as a whole, that look at specific communities where projects are being built. We're certainly polling for people in those local communities and areas. But what we really wanted to do was to get sort of a 30,000-foot view across the country of what perspectives rural Americans have, where they are at this point in time, and how they're feeling about the renewable energy transition that is happening. And so we surveyed 2,645 rural Americans across the country, and we were able to have conversations with them, both the quantitative survey and then also the qualitative, get information from them that they could fill in so we could learn a little bit more about their perspective.So, sort of virtual conversations, not actual conversations. And we were able to really get a look and understand where they are and go beyond just sort of the loudest voices in the room, which has really been a big stumbling block in these communities, to getting these projects built.David RobertsIn the small handful of items that I would list as threats to the success of the clean energy transition, threats to the success of IRA and all the rest of the bills, NIMBYism and permitting is probably the biggest and most threatening one. And so everybody's thinking about this right now. Everybody in the energy world is thinking about this right now. And one of the big questions I think that's on everybody's mind is this resistance that we're seeing, is it a small handful of people that are being paid by right-wing groups stirring up this trouble, or are they speaking in some sense on behalf of a broader sentiment?In other words, are they articulating the true sentiments of people in those areas? So maybe the place to start is just what did you find out, that they think about renewable energy?Robin PressmanSo, to start with, there is support for these projects, both solar and wind in rural communities. And support does outweigh the opposition as a whole. When we ask people, do you support or oppose solar energy and wind energy projects separately being built in the following areas, communities across your state, in your local community, or on a property near yours, we could see that support does outweigh opposition across the board. As you get a little closer to on properties near yours, you would expect to see some of the support drop off —David RobertsYour backyard.Robin PressmanRight, and the opposition increase, but not nearly as significantly as we thought it would.And so there is sort of a core group of people that are opposed, certainly, but it's not as strong as one might think. It tends to hover between 10% and 25%, depending on how proximate the project is to you. And we can see that, for example, when we ask in your local community, we can see strong support, 37% strongly support solar and 32% somewhat support it. And for wind, similarly, 30% strongly supporting, 26% somewhat supporting. So, there's real opportunities here for having the conversations. But when we dug in underneath the top line data, what we can see is some real differences.And interestingly enough, while, as you might expect, Republicans tend to be more opposed to these projects than Democrats, we see a real difference between MAGA Republicans and non-MAGA Republicans.David RobertsAre those self-designations? Like, these are people who self-identify as MAGA Republicans?Robin PressmanYes. We ask them their party identification. And for those people who self-identified as a Republican, we then ask them if they identify as a MAGA Republican. And about 28% of the entire sample identified as MAGA Republican. And so what we see with those non-MAGA Republicans, we see real opportunity for growth. And we already have pretty strong support with independents as well. So, there are some groups there that we can talk to that are either already supportive or maybe sort of soft supporters who, when given and educated a little bit more information about understanding the impact on the community, are going to become stronger supporters.We also similarly saw interesting difference between people who self-identified living in a small town or a rural area.David RobertsWait, those are two distinct things.Mike CaseyYes, and an important distinction actually.David RobertsSpell that out a little bit. When people choose between those, what are they saying?Robin PressmanSo, this is a self-determination. So, when we created this survey, we looked at a number of things. We looked at the rural areas based on subcounty designations and then ZIP codes based on population density, to be sure that we really were talking to people in rural areas, and we are overwhelmingly so. But there are small towns, right? Within these communities, there are one-stoplight towns. There's a main street, there are shops, there's a coffee shop where people are coming. And the people who are living more closer into the small towns tend to be stronger supporters than the people who are further out, right where these projects are more likely to be built.David RobertsThat's funny. One of the things that we keep finding is that more density equals bluer, and that seems to hold at every level. Even out here in the rural areas, these smaller distinctions in density seem to matter.Robin PressmanYes, but they're not entirely blue. These are areas still, that even in the small towns, these are areas that voted, still voted for Trump overwhelmingly. Right. So, these are definitely red; they're just not as strong. But what we see is people who help build the fabric of our communities, who maybe run the small shops in town, or you know, work at the local buildings, are going to see some opportunities for growth and benefit overall. And we sort of started in the middle of this conversation and I should have premised this with this is, it's really important, the context for understanding where rural Americans are right now.And that is that they're decidedly downbeat. I mean, half think that the country is off on the wrong track, and we can dig into this further in a little bit. But their perspectives on their communities, in terms of economic opportunities, job opportunities are really, really downbeat. And so people are seeing a need for something that's going to be beneficial for their communities, but they're not necessarily believing yet that renewable energy is going to be that solution for them.David RobertsInteresting. Well, the big question to me, I mean, politically speaking, the big question here is about intensity. Like anyone who follows politics, I think, knows that wide, broad, shallow majority support cannot stand up to narrower, smaller, but more intense opposition. Right? Because intensity is what brings people out to meetings. Intensity is what makes them speak up. And if you're just sort of like mildly in favor when you're asked, that's not going to get you out to the meetings. So, do you have any way of measuring or judging the intensity of this sort of majority support versus the kind of concentrated MAGA opposition?Robin PressmanYeah, well, we can see is, like I said, when we look at some of these questions and we look at strong supporters versus those that may somewhat oppose, we can see that there is opportunity for growth. And when we look at those who just identify that they're not sure on a series of measures there is real opportunity for education and growth there, we can see that maybe when we start talking about specific aspects of what these projects are going to bring to their communities, you get about 20-25%, about a quarter saying that they're not sure what the implications are going to be for their communities as it relates to, say, tax benefits, for example. So this really opens up opportunities for conversations.And here's the important point: It's conversations with culturally credible messengers. Having companies come from outside is not necessarily welcomed or appreciated in a lot of these communities. Identifying folks that are from those communities, specifically farmers and ranchers, small business owners who can have these conversations with their friends, with their neighbors, really carry significantly more weight. There's some perspectives that we were able to uncover in the survey that really just look at how rural Americans perceive themselves as it relates to the country, and they perceive that they're looked down upon. They think that elites, liberal elites from the coasts are looking down upon them.They think that the politicians aren't paying attention to them and their needs, and they're not feeling understood in that. And so those are really important points. And so when you have outsiders coming in and making promises of tax benefits, and here's all this opportunity we're going to bring, they're decidedly suspect of that, as you might imagine, rightfully so, given their experiences and where they're coming at it from. But importantly, as we begin to share more of that education, of the information, of the opportunities that it can bring, we are able to build a coalition of supporters in these communities.Mike CaseySo, there's actually some good news here. The good news is that the poll that Robin's firm ran, that we were part of in terms of commissioning it and socializing it, mirrors what the Berkeley National Lab study in 2019 found as well. So, they looked at people who were neighbors of existing wind farms. Three miles, one mile, half mile radius. Half mile is less than most of your dog owning listeners walk their dogs at night. And among people who lived within a half mile of a wind turbine, 51% had a very positive or positive experience. 24% had a very negative or negative experience.That's actually worth taking into account. Wind is typically viewed as triggering greater opposition than solar. That was found in our poll. But yet among those who live next to it, they don't mind.David RobertsI mean, 51% is — I guess that's good news. Half and half. It's not great news.Mike CaseyWell, actually, no, check that out, though. So, 51% very positive or positive, 24% very negative or negative.David RobertsRight?Mike CaseySo it's a two to one ratio. That's actually a significant gap. And the point here is that you are right: Of the nine barriers to the clean energy transition, critical minerals, grid stability, physical infrastructure, transmission, workforce development, supply chains, government, storage, permitting is the most likely transition killer. No question. Yet people who live next to it, once it gets built, it is readily accepted. All the data show that. And the even better news is that what renewable energy can offer rural communities is an almost exact match with what rural Americans say they want for themselves and their neighbors.They want lower energy prices, they want jobs so their young people can stay in the community, and they want tax revenue to address aging infrastructure. That's exactly what renewable energy offers.David RobertsThat's what they say on the poll that they want. That's where you're getting up.Mike CaseyCorrect.David RobertsI think this is a pattern of NIMBY opposition, not just to wind and solar, but to urbanist projects. And I mean, name it. It's almost always the case that afterward, everyone's fine. Everyone's fine with the thing. It's the same with, like, a bike lane. Like, after the bike lane's built, everybody loves the bike lane. It's always that way. But that never seems to translate into making it any easier to build the next bike lane. Do you know what I mean and like so the fact that people are happy with wind farms once they're next to them, how do you translate that into making it easier to sell the next wind farm?That's the magic here. Mike, I have a bunch of questions for you about engaging with this, but just a couple more for Robin. Did you, on your poll run by these rural people, specific arguments for and against renewable energy? And if so, I'm just curious what arguments against it are catching on and grabbing people's minds? And conversely, what are the arguments for it that actually sway them?Robin PressmanAbsolutely. So, starting with what people are really for, some of the messages that really resonated focus on the fact that we're going to move away from dependence on foreign sources for energy. The increase in renewable energy decreases our energy dependence on other countries, which resonates, as well as the diversification of the grid. Renewable energy helps diversify our sources of energy, ensuring that the lights stay on even if one energy source fails. So, those really rise to the top. Some of the economic arguments that we tested in this poll didn't work quite as well. And I think that partly there's a "not sure" component here.As I mentioned earlier, about a quarter identified some of the tax benefits.David RobertsYou mean in terms of local economic benefits that these things bring?Robin PressmanYeah, exactly. And so there's some education and because it's generic. So, we've seen in other polls where we've gone into very local communities and asked the question related to specific projects that we could name that are nearby and received greater support. So, to some extent, by asking it in a generic sense, they're not sure. They're wanting to get more information.David RobertsRight.Robin PressmanAnd so the opportunities will increase as we go into these communities and we can serve up these messages again, relying on people from within the community, people who have gone ahead and had projects built in their backyard or on their land and are benefiting from it, to be able to share some of that experience with their neighbors.David RobertsRight. Speaking of trusted messengers, people from those communities.Robin PressmanYes, absolutely.David RobertsBecause it seems to me like a general rule that these sort of abstract principles that you kind of will say you're in favor of in a poll like energy independence and things like that, those things, in my experience, tend to crumble pretty quickly in the face of, "But this will hurt you specifically." And so I'm curious, what are the — you know, if I'm a right-wing group and I'm going into one of these communities to try to stir up opposition — what are arguments am I using that are working? What triggers people?Robin PressmanYeah. So, one of the greatest concerns people have is that renewable energy cannot currently meet our energy needs. And that really rises to the top of concerns. You also see some people have concerns about the use of farmland and that the benefits and energy are actually going to go elsewhere, that their community is not going to be the one to really benefit to the extent as other communities will. There is definitely skepticism at this point about renewable energy fully meeting those needs. But again, opportunities exist for education where we can see that people are identifying as either somewhat disagreeing or not sure, and we can go in and educate folks on those benefits.David RobertsWell, it seems to me that rural communities in the US have good, historically grounded reasons to think that energy companies might come in and treat them like a resource colony, mess up their land, and extract all the benefits, because that's basically what fossil fuels have done everywhere they've gone in rural US. You know, why wouldn't you think that seems quite sensible to me. So, Mike, you and your colleagues are out talking to people at renewable energy developers who are now having to deal with this. And this, I think, is not totally new, but there's certainly a rising level of opposition and just the significance and the importance of the whole thing, it's just rising.And when I think about the renewable energy developers that I've spoken to and that I know, they just do not, I say this with all love and respect, do not strike me as the kind of people who are going to be particularly adept at navigating these highly charged, fraught, very culturally specific circumstances into which they're being thrown. Like, it just seems like they're going to get chewed up. Are the people you're talking to, do they feel prepared? Are any of them actually prepared? Do they have a good sense of what they need to be doing? Do they have the same view of themselves that the rural residents have of them?Sort of like, what are you finding when you talk to these people?Mike CaseyYeah, it's a good question. So, I should just give credit where credit's due. Our Director of Community Engagement, Ayelet Hines, also teaches influence mapping at Johns Hopkins. So, this is her jam and she ran most of these interviews. But from the meta perspective, community engagement professionals have a very good sense of the dynamics in the community. They also volunteer. They feel very undertrained for the increasing political campaign aspects of their job. That's really what we found, is that if you look at the punch list of tactics that community engagement teams are facing in these communities, it reads like a political campaign.So, political campaigning is being done to them and these companies are not responding in kind. And fundamentally that's because the leadership teams of the companies who have never really had a reason to be in the room and get yelled at, so to speak, until you're there, and I have been there, you don't really get the sense of how visceral the concerns are in these communities. They really are proud of their communities. They value their way of life. And what we find in talking to developers is that MAGA voters, they're usually leading the opposition. And we suspect that's because of the following reasons: One, these voters see the culture in the country going in a direction they don't like. Now anybody can have opinions about their opinions. That's irrelevant. These are people who have the right to vote. They have the right to their opinions. They have very strong opinions. And their opinions —David RobertsWell, Mike, you say they see it. Let me just clarify: They are hooked up, trapped by, entirely captured by a gigantic propaganda machine that is pumping their heads full of the most paranoid stuff you could. I mean, they're not just seeing this happen, this story is being shaped and fed to them everywhere they look.Mike CaseyYes, I'm taking a more clinical view of it, David, I think because —David RobertsSorry, it works me up.Mike CaseyNo, totally understood. But I think that's actually a useful thing you just said. Let me take it as a microcosm. This industry is going to have to build things in rural America, and rural Americans are not going to change their existing baseline worldviews and opinions to accommodate clean energy. The only route to building in their midst is to respect their views as their views. You don't have to agree with them, but you have to respect they hold the views they have and you have to address them on their terms.It's the ultimate sign of respect. And what rural communities demand above all else is that you respect them. You come in the door respecting their way of life, their quality of life, and their values. And that really is the challenge I think the industry faces. I think in retrospect it's pretty clear that this industry committed an original sin, unknowingly. It assumed low friction permitting, and it's not what it's encountering right now. So, the people that we talk to are squeezed between an emerging reality on the ground and leadership teams who don't have a reason to fully appreciate it and the budgets are sized accordingly, and therein lies the problem.David RobertsWell, it seems to me it ought to be showing up in the numbers by now. Like, there's a lot of projects getting shot down and killed. There's a lot of projects waiting in queues. There's just a lot. I mean, at this point, it's hard to avoid the permitting problem. It ought to be, seems like it.Mike CaseyYes, you know I'm most of the way through a book called "The Polluters." It's a history of the chemical lobby. And if you read that book, if you read Robert Caro's book about LBJ, particularly "Master of the Senate", what you see is that industries mature in the way they organize and deploy their public affairs, their lobbying, around decade six or seven. Clean energy is most generously credited with being in its third decade. And here's the challenge most clean energy companies do not understand: They are not creating a new industry as Google did. They are creating a new sector within an industry dominated by powerful incumbents with decades of experience weaponizing government influence peddling and disinformation.And because of that, there is this residual amount of magical thinking, and it affects the way this industry makes its case. And the challenge and the task here for those of us working in the industry is to accelerate, unnaturally accelerate the maturation of the way this industry scales up its public case making at whatever level of government decision. And this is just one of those.David RobertsSo then, I guess, as someone who has studied and thought about and talked about and written about for a long time, the power of, the increasing power of right-wing media, the increasingly concentrated power of it, the increasing domination of rural America by it. I get your point about you have to respect their identity and their worldview. But it seems like it would be pretty easy for right-wing media to come along and tell these people, "hey, guess what part of your worldview is that renewables are bad." And if right-wing media decides to do that and has their eyeballs and their ears locked up, what power does a company, does a single company wandering into town with a project in their back pocket, what power does a single company have against that?In some sense, they just seem, even if they were well funded, it seems like they're outmatched here.Robin PressmanWe did ask some questions about understanding what news consumption people —David RobertsOh, yeah, yeah, I meant to ask about that.Robin PressmanYeah. So, about 40% identify online news sites, which can mean a wide variety of things.David RobertsI'll say.Robin PressmanBut 37% local news, you see about 21% identifying Fox News specifically the more right-wing sites, 17% identifying things like Newsmax, Breitbart, and the Blaze. What's interesting to me though is we asked a question earlier on about what are some of your concerns about renewable energy? And one of the options that was offered was sort of taken straight from the disinformation playbook, and that was that wind and solar can harm your health. And we only saw about 5% of people identifying that as a concern.And when we asked the open-ended question, just what are your concerns? It didn't come up at all. And it may be that other pieces of disinformation are sticking more than the one we asked about, but in that sense, it didn't rise to the top. And so I think people are able to sort out, of course, you'll always have a core percent of people that are going to be sort of stuck in their own perspectives and in their own loop of information. But generally speaking, their concerns seem to be grounded in some of the areas we talked about, which is reliability, use of farmland, that sort of thing.Mike CaseyDavid, to answer your question, it is the disruptor's sentence to have a disruptor's needs: large, with disruptors budgets: small. And yet that doesn't get us off the hook. It is a fundamental reality that clean energy is doing the equivalent of walking into a party, going up to the biggest guy in the party who's sitting on the couch and going, "dude, you're in my seat, move." That's what we're doing. That's what we're doing. And we have to get over ourselves that incumbents with trillions of dollars in physical infrastructure, sunk costs, are not going to just say, "You know what? You guys are right. The planet's on fire. I'll listen to the IPCC. I'm going to just convert our vast infrastructure into a home energy management company, no problem."It just is not going to happen, you know. One of my favorite sayings was Confucius: "Those who say something is impossible should not interrupt those who are doing it." And I really think that our task here is to stop whining about resource disparity and suck it up and start pooling our resources to at least do the basics better. Allow me to give you a contrast.David RobertsYeah, please tell me about the basics, because I have no, like, if you told me to go into a small town and work up support for a renewable energy installation, I would not have the slightest clue where to begin. So, what are the basics?Mike CaseyWell, I'll give you an example. So, I gathered some of this information in the research I did for a piece I wrote last year called "We're the People We're Waiting For." And it was essentially a study about how do we prevent the next Joe Manchin holdout on a critical climate solution step we've got to take. And if you're Joe Manchin, you are well aware that the oil and gas industry, really, the fracking industry in West Virginia, has a statewide annual festival. You can go to Parkersburg and go to the Early Oil and Gas Museum. Your graduating high school senior can apply to West Virginia Wesleyan for a full ride to become a fracking tech.Right. Now, what they've done, and I say this because I actually cited something you wrote a long time ago where you talked about a country western song that lionized a coal miner.David RobertsYeah, I remember that.Mike CaseyThis is 100% what we're talking about. There has been great effort, very culturally astute by incumbent polluting sectors, to put biceps and belt buckles onto the digging out of our energy supply. And the whole meme of —David RobertsAnd trucks, too.Mike CaseyRight? The whole meme of Solyndra was that if you don't dig or mine for your energy, it's beneath your dignity. Now, there are four wind farms in West Virginia. One of them, what was built, was the largest one east of the Mississippi River. And if you go on Tripadvisor right now and you search their names, you're going to see people expressing frustration. They couldn't find the things. Well, why do they want to go there? Because they want to look at it. And the crazy thing is that our industry is ghosting its host communities, places where the wind and solar farms are already built, make almost zero effort to grow, curate, and demonstrate support.Now, why is that important? Because I'll point you to research by the Republican Accountability Project. These are never-Trumper national Republicans, George Conway, et cetera. They have tracked attitudes and worldviews of Trump voters from '16 to '20 to '22 and beyond. What they've noticed is that the more legal trouble Trump gets into, the tighter the screens on information sources and validation that these voters will have, and that 100% applies to the Americans we're talking about. So, if we are ghosting, like communities. For example, two counties in Michigan, one is called Isabella County, and the county to the south of it, Montcalm County.Isabella has a huge amount of renewable energy development. Montcalm, there's a great deal of contention around renewable energy development. The best validators for Montcalm County undecided residents are Isabella County residents, because they know some of them and they look like them, and they are like them, and yet we're neglecting that. So, can we put on a festival, statewide festival with a beauty pageant? No. Can we have a museum yet? No. But for goodness sakes, we have basic block and tackle, making the most of our built infrastructure, communicating through social media. Really, Facebook, because that's the new newspaper in rural America.Proactively engaging rather than just responding with fact sheets. These are some campaigning basics that don't cost much in the way of money. You just have to work them harder. And will we close the gap entirely? No, but we can close the gap a lot.David RobertsSo, a big piece of this, then, is this going somewhere where you already won a battle, where there are happy residents next to these things and simply trying to sort of formalize and amplify that positive feeling? Get some of those people to testify on your behalf or write op-eds for you or talk to their neighbors on Facebook. What's that look like?Mike CaseyVideo testimonials. I'll give you an example. Robin and I, we did a precursor survey in the very tip of the thumb of Michigan, a county called Huron County, 33,000 residents. Ruby red, voted for Trump, 69% over Biden, and it has the highest density of wind turbines in the state of Michigan. Michigan has a very strong township structure, so it's kind of like many counties within counties. And as the years have gone by and renewable energy has been developed, moratoria have been passed in various townships. So, Robin's firm did a poll. It's brilliant. And they asked, do you want more renewable energy development or not?Negative 9%: No, we don't. By nine points: No, we do not. Now, we ask, in one question, naming three specific pieces of infrastructure, a school lab, a parking lot, and something else. And we explained to Huron County residents, this is what renewable energy has paid for. Now, how do you feel? David, opinion moved 14 points. I have read thousands of polls. I've participated in the construction of, I don't know, 100 or so. And you have to usually ask batteries of questions to get opinion to move 14 points. One question, 14 points. And what that tells us is people are open to this if you talk to them with local reference points, respecting their culture through people they're willing to listen to.Does that beat propaganda from Robert Bryce on Breitbart? I don't know. I think it remains to be seen. But we don't get to declare that it can't unless we've tried, right?David RobertsI bet there's enough for a museum. It occurs to me now, like, why isn't there a museum of renewable energy? It's been around for at least a few decades, like get some old NASA solar panels. Someone should do that. Is there a success story here, Mike? A company that's done well, or a company that is not ghosting its communities, that is staying in its communities and working up support and trying to expand support and use that to leverage more? Is there anyone who's doing this well?Mike CaseyYes, there is a high degree of variability in the sophistication of the programs. One public example is AES has the largest wind farm under construction. They just completed a second phase in Winslow, Arizona, and the community support is very strong. This is a sprawling pair of counties. One of them is quite Trumpy. I think the other one's a little bit more even, but in terms of presidential preferences, but they have really strong support. Their phase completion event was extremely well attended by the local community. And the details on how they got there, I think I'll let them share.But there are companies, an increasing number of companies that are seeing: We've got a $10 to $20 billion problem unfolding here and we're underinvested and we want to change that. I can 100% tell you that awareness is growing. I think the important thing is that the industry overall, most of the developers came out of a European utility background. EDP, Avangrid, EDF, EON/RWE. These are all companies that started as European utilities, and then they started building renewable energy overseas in their home countries, and they came over here and built renewable energy. And for brand considerations, they've had very tight controls on how they allow their staff to use Facebook.But you can't have handcuffs on your staff when you're using Facebook, because it's the conduit where community decisions are framed and the decision making gets going. And if you tie your shoes together, you can't win a race.David RobertsYes, although releasing your employees to freestyle on Facebook also carries its own risks.Mike CaseyI didn't say freestyle, and I would just assert there's a whole lot of room between "don't do anything unless we approve it at headquarters" and "do anything you want." There's a whole lot of room. So, I'm arguing for a firm midway point in that.David RobertsA lot of these companies are relatively small and I would imagine don't necessarily have the funds to staff up like whatever ten person community engagement squadron. Is this the kind of thing where there can be shared resources? I mean, a) shared resources among and between developers, but also b), it seems like this is something that they ought to be getting help with from the broader community of people who are concerned about seeing renewable energy get built, you know what I mean? Like, it'd be nice if they had a gigantic propaganda machine on their side, but at least something. So, how could we move beyond these sort of one by one battles, one by one companies and pool resources?Does that spark anything?Mike CaseyWell, I know that those are active, ongoing conversations right now. I'm a part of some of them, and I know those are taking place. And I will say that it remains to be seen how much of the traditional development processes that originated with oil and gas and real estate that are now being used for renewable energy, how much of those can and should be changed to accommodate newly emerging political campaign demands, so to speak. And our conclusion, having talked to the companies, is that fundamentally, the companies are going to have to experiment on a per company basis, how to advance and update the way they're solving for these emerging realities.I don't think there's a right way. There's a body of best practices, generic best practices for public case making, and then there's a set list of tried and true development steps. The former have to be experimentally incorporated into the latter, and the latter varies by company. So, there are some things that multi-company platforms can do. Further research from Robin's shop sharing results of pre-designed experimentation. These are things that can be done. And yet, fundamentally, the companies need to seize their own destiny and understand that even if it's a significant expenditure, it beats bankruptcy, it beats lost projects.David RobertsMy gut says that part of their reservations have to do with resources having to do with needing to spend a bunch more money on this. But I'm just guessing, based on what I know about the type of people who are in this business, that if you come to them and say: "You are now mired in politics, you are in a political campaign. There's a political campaign being run against you. And if you want to build your project, you have to run a political campaign on your own behalf." That just horrifies people. These are generally technocrats, I think, who want good information and fact sheets to carry the day and loathe partisan politics and are horrified by the thought of getting hoovered into it.How big of a factor is that?Mike CaseyIt's massive, in short. Because your descriptions are fairly on point. And I think Robin and I have seen that reaction unfold for the last two months, I think since we spoke at the trade show, and we use that term political campaigning with intention. It does push up fears and concerns, because when non-politically experienced people hear that, they think about attack ads, hyper-partisanship, bribes, like first energy cuts.David RobertsWell, politics is ugly these days. I mean, it's just ugly. That's what comes to mind is ugliness.Mike CaseyRight? And so we have to explain to them, this is the basic block and tackle. It's communicating within emotional frames. It's winning the race to define. It's using social media as an engagement tool, not a cheap form of news release distribution. And when you help people understand that their assumptions aren't matching what's needed, their concerns ease and they're just — cod liver oil is good for you to have, but it tastes like crap. And there's no getting around that it tastes like crap. So, if you want the benefits, you have to drink it. And so we just don't have enough time in the planetary hour to be hung up on ourselves and our squeamishness about the messiness of public case making.As Gandalf said in Lord of the Rings "War is upon you". You know, Gondoer. I'm sorry you don't like that, but that's just the way it is. So the orcs can pillage your castle or you can actually defend it. And that's really what we have. We are telling that big guy at the party, get off the couch, that's my seat. That's what we're doing and we have to do that. So, if we accept that and then we get over ourselves, let go of our concerns and fears, invest at scale to the best we can, I think we're going to see a lot of this difficulty be reduced. Not eliminated, but reduced.David RobertsRobin, I'm curious. My priors, my instincts are to think that rural people's opinions about renewable energy as such are relatively shallow and easily shiftable and that the deep currents here are more of what you referenced earlier. Just about: "We don't want to be disrespected. We don't want outsiders coming in and plundering our resources." Did you poll about other kinds of development? Like, did you poll about how do you feel about how would you feel about a fracker coming in and fracking? Or how would you feel about new oil wells or new oil drills? Is there anything specific to renewable energy here?Or is this mostly just sort of general feelings about culture and the culture of being rural and the culture of outsiders, that kind of thing? You know what I mean?Robin PressmanYeah, I do. It's a good question. And in short answer, no, we did not find it beneficial to do. But in every poll, you have to make decisions about what you're going to include. And what we decided to really focus in here on is attitudes and perspectives of rural Americans. We wanted to sort of dig in and really understand where they're coming from and what opportunities and concerns they see. And while 70% think that rural communities offer a better quality of life than other types of communities, around three in five identify rural America as, quote, "the true America" and think that rural Americans work harder than others.But yet 60% strongly agree that the national media and elites don't understand what life is like in rural America. And similarly, a majority strongly agree that people living in cities don't understand the problems that rural Americans face. So, beyond sort of looking at renewable energy specifically, we wanted to understand what are the concerns of rural Americans? What are the challenges they're facing? They're facing tough economic times. They're facing a situation where they don't feel like there are enough jobs moving forward for them, availability of good jobs for themselves and opportunities for young people. Significant concerns. And interestingly, also availability of low-cost energy is a concern.So, we see these economic concerns, but they're not yet hearing the solutions that they feel are going to bring them out of this difficult situation. And so that's where we chose to really explore here, is to understand what are some of the messages, what are some of the messengers? And as I mentioned earlier, through some of the open ends, just sort of try and hear directly from people talking about their struggling. They're struggling with bills, they're struggling with groceries. They really are facing these challenges. But there's an openness with some, certainly to going forward to new technologies for renewables and the jobs and the opportunities that they'll bring.So, there is some of that there, and more conversation is really going to open up more opportunities, I believe.David RobertsYeah, one of the things that occurs to me is, and this is something that whenever I talk to sort of like marketers or people like that, they always cite as one of the strongest sort of psychological forces in messaging, which is just, I think what people want to hear or are looking for is something along the lines of "people like us do things like this." That's what moves people. And so this brings back to the messenger thing. This brings back to the success story thing. This brings back to sort of know, they just need to make that mental shift where this is not something people want to do to us, this is something people like us do to better ourselves.It's like moving the locus of agency from outside to inside somehow. So, along those lines, Mike, final question for you, which, know, you said a couple of times that obviously every situation is different, every community is different. In some way, every project is different in some way, and there's not going to be an obvious kind of like mechanical algorithm to follow here. But on the other hand, as you say, there are some basic common-sense things. So, maybe just by way of concluding, you just say, if I'm a renewable energy developer and I've got my eye on a community there in rural, whatever, Pennsylvania, and I've watched your slideshow and I've read your poll, and I'm ready to do these things.What is my sort of checklist of basics? What are my block and tackle basics, like the obvious things that I need to do? I'm guessing that one of them is that I think one of the worst sins of these things that people don't do is engage early. So, the residents of these communities end up being sort of confronted, like, "here's a thing on your doorstep, yes or no," and naturally, it gets their hackles up. I'm guessing engaging early is part of it. But if you just had to give a list of like four or five, "no duh", at least do this type of things for that developer, what would those be?Mike CaseyEngage early. Start by talking to the business community. Use culturally credible messengers, gather validation from built project neighbors, and do not be afraid of a mess and cacophony that comes on Facebook. Embrace it, because that's the way community conversations are had. And David, I'll tell you an anecdote that I source as the genesis of this, the whole arc of what at least my firm is doing on this. 14 years ago, I took my then six-year-old daughter to a wedding in Idaho Falls. And so we flew to Denver and we puddle jumped to Idaho Falls.And as the plane came into Idaho Falls, it banked over a mountain range, and there was a wind farm wind project that dotted some of the peaks. At least half the people in the plane were locals. And as the plane banked and the wind farm came into view, there was an audible gasp like, "whoa, that's cool," from the locals. And out came the phones and people were taking pictures. The thing is that rural communities have a lot of really great qualities. And one of them is people aren't afraid to work. They work with their hands. They like to understand how things work and renewable energy, mechanically, it's really interesting, it's cool.And we are not making the most of that. We're instead just expecting people who don't see the problem that we solve as nearly as serious a crisis as people who listen to this show. We're expecting them to see the world our way and to accept what we're doing on our terms. If we change that, if we open our minds to how they see the world and communicate to them where they are, this is going to go significantly better and significantly more successfully.David RobertsI come back over and over again to the appropriate messengers thing because — nothing's worse, and I'm familiar with a lot of this kind of talk in the politics world, and what I've found is nothing's worse than someone trying to mimic a different culture. Do you know what I mean? A different culture, like reading off a list of things and trying to sort of sound, "hey, I'm an authentic rural guy." There's nothing cringier and there's nothing rural people spot faster than that. Right? So, it just brings me back again and again to find the people who speak the language natively and then train them like that just seems to me like it ought to be such a huge part of this.Mike CaseyIt is.David RobertsIt's a little wild to me that this is such a huge problem that we're running into. And I've been thinking about this a lot lately, Mike, I've been thinking about your nine possible blockers. And I've been thinking a lot lately about what a huge piece of the puzzle social license is to all this, just getting people to agree to let you do it and how comparatively little compared to the amount of energy system modeling and price comparisons. And just like all this technocratic quantifying and modeling and how comparatively little real tangible research and work is being done on the kind of sociological and psychological and cultural aspects of making this work.And that's like where the rubber is meeting the road now. That's where everything is happening now. And it's so weirdly, everybody's hand waving, everybody's trading priors and trading intuitions. So, it's just nice to finally see some meat on the bone here, some people actually going and researching this problem directly.Robin PressmanThank you for that. One of the benefits of our approach with polling is it allows us to be able to get into these rural communities where it's difficult sometimes with other types of polling to do with significant samples. So, it allows us to be able to launch these surveys and be able to have the information from the respondents.David RobertsYeah, it's great to hear directly from them. So, yeah, thanks for doing the research and thank you both for coming on and walking through it with us.Mike CaseyDavid, I'll throw in a final point. You can throw it on the tape or if you want, but I sound like Elrond of Lord of the Rings, "I was there 3000 years ago." But the climate community, the NGO climate community, it seems very safe to say now that we made a terrible decision 30 years ago to let the inmates run the asylum. We let wonks and lawyers do our messaging. That's why we're stuck with these terribly uncommunicative terms that ExxonMobil loves us using. Emissions, greenhouse gases, climate change. No, it's pollution. It's climate disruption.David RobertsNet metering.Mike CaseyRight. And that came because there was this technocrat's proclivity to be exact, to have the world comport with the way we are certain it is. We need not, we cannot afford to make that mistake now. We cannot let engineers run our public communications campaigns.David RobertsYour lips to God's ears. I'll just say that's not just the renewable energy community that needs to hear that.Mike CaseyI mean, obviously I say this with love and I make my living as a fan of this industry. And Robin and I funded this poll even though we got turned down. We pitched this poll to the industry to pay for. It declined and we paid for it.David RobertsThat's crazy. That's crazy.Mike CaseyThat's how strongly we feel about it. But it needed to be done. And that's okay, because if it slingshots a better approach across this industry, we're going to stand a much better chance of realizing that 40% carbon pollution footprint reduction potential in the IRA. And if we don't, we don't.David RobertsRight. Well said. All right. We'll call that the final word. Thanks, Mike. Thanks Robin. Thanks for coming on.Mike CaseyThank you, my friend.Robin PressmanThanks for having us.David RobertsThank you for listening to the Volts podcast. It is ad-free, powered entirely by listeners like you. If you value conversations like this, please consider becoming a paid Volts subscriber at volts.wtf. Yes, that's volts.wtf. So that I can continue doing this work. Thank you so much and I'll see you next time. This is a public episode. 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