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The lowly circuit breaker was first patented by Thomas Edison and hasn’t been updated much since — until Atom Power CEO Ryan Kennedy came along and made a digital version. In this episode, he describes the basics of the digital circuit breaker, the ways it’s making a difference in the EV charging market, and its gamechanging potential. (PDF transcript)(Active transcript)Text transcript:David RobertsThere is perhaps no building block of the electricity grid more fundamental, ubiquitous, and overlooked than the humble circuit breaker. Every electronic device that is attached to the grid runs through a circuit breaker, a device that automatically shuts off current in the case of a fault or surge.Currently, though they have become extremely reliable, circuit breakers still rely on technology that was patented by Thomas Edison. They operate purely through electromechanical forces, with no digital control.My guest today, Ryan Kennedy, is the first person to develop, patent, pass UL testing with, and commercialize a digital circuit breaker. It is solid state — that is, it has no moving parts — and current is controlled entirely through semiconductors.In addition to being faster and safer than electromechanical equivalents, each digital circuit breaker contains within it its own firmware and software, which can be programmed to emulate, and thereby replace, any number of other software-driven devices like demand management systems, load controllers, meters, and surge protectors.Kennedy's company, Atom Power, is currently focused on the electric-vehicle charging market, offering smart load balancing and management from a centralized circuit board, replacing the need for complicated hardware and software in the EV chargers themselves.But the ultimate applications for a digital circuit breaker are endless. Everywhere they are attached, a grid becomes a smart grid and appliances become smart appliances. If even a substantial fraction of today's circuit breakers could be replaced with digital equivalents, it would bring unprecedented visibility and control to millions of distributed energy devices, enabling all sorts of sophisticated demand management.I was extremely geeked to talk to Kennedy about the basics of circuit breakers, their application to EV charging, and the many possibilities that lie beyond.Alright, then. Ryan Kennedy, welcome to Volts. Thank you so much for coming.Ryan KennedyDavid, thank you for having me.David RobertsThis is awesome. I'm so interested in this widget and its possibilities, but I think to help people get their heads around it. Before we get too deep into anything, let's just start at the most basic level. For those of us who were humanities majors and never took any electrical engineering or anything, let's just talk about what is a circuit breaker. I know people are very vaguely aware of circuit breakers. They are in a circuit box in your garage. Occasionally, your power goes out, and you wander out to your garage and flip switches around and try to see what works.But, I think that's probably the extent of most people's knowledge. So let's just start there.Ryan KennedyCircuit breakers, electrically speaking, are one of the oldest products on the market. They first were invented, at least patented by Thomas Edison to show you how far back they go. But, they're effectively a method of interrupting the flow of electricity when things go wrong. Too much current, short circuits, things like that. The purpose of the circuit breaker is to simply open the circuit when those things happen and protect from fire, primarily.David RobertsAnd, presumably, protecting the appliances and the things on the other end of the wire, too right.Ryan KennedyGenerally, that's the assumption, though I don't know that it's necessarily the explicit purpose. I think the more explicit purpose is to prevent fire. That could mean your equipment may go bad, in the process, but generally speaking, to prevent fire and hazardous conditions from electricity.David RobertsAnd so, every appliance, or device, or anything that uses electricity from the grid is connected to the grid through a circuit breaker. Is that true? Is that a universal rule?Ryan KennedyThat's right. Actually, the easiest way to visualize that is to think about the home or apartment, where you have a panel with breakers in it that typically open the front door and you can see breakers in there, and you flip switches and things go wrong. So basically, you have a big power feed from the utility that comes into that home to that panel, and then out of that panel, power gets distributed through each one of those little circuit breakers out to individual loads in your home, such as hot water, HVAC, lights, receptacles. That scales out. Commercial buildings and industrial buildings and data centers are the exact same thing.I mean, there's more breakers, and they often get bigger, but it's the exact same architecture across the entire planet. Or the circuit breaker always is the thing that sits in front of the thing that consumes energy.David RobertsRight. And so, the purpose of these things is to basically shut off current if something goes wrong. How do they do that currently?Ryan KennedyThere's a couple of different ways, but the most predominant way is it gets into a little bit of engineering speak. So I'll try not to dive too deep, but basically, it's through thermals and magnetics. So, there's kind of two situations you would have. Let's just pick on the home a little bit because the same problems scale upward to commercial, industrial buildings. When you say, plug in way too many things into the outlet, the breaker will trip. And that's tripped through thermals, means that too much current is flowing, things get hot, and some expansion happens inside of the circuit breaker. And, mechanically speaking, it flips a spring, and causes the breaker to open.David RobertsSo it's not a heat sensor. It's literally the heat expands something physical, and the physical change trips something.Ryan KennedyIt literally expands the metal inside of the breaker to open it up. That's what happens. The second, there's two methods—that was thermal—the second is called magnetic. That mechanism, it operates physically the same way. The actual springs and levers inside of the breaker open up the same way. But what causes it is different. So, magnetic happens when you have, say, a short circuit. Don't do this at home, but if you took one of your wires from your home and just put it into a pool. Lots of current flow all of a sudden, really really fast. That's called a short circuit.And you don't want to wait for things to heat up because that's when really bad things happen. So what happens is an enormous amount of current starts flowing through that circuit breaker, creates a pretty quick magnetic field that basically pushes the metals apart inside of the breaker to open it up, as well. So it's very much a passive device in the sense that there's nothing in them that say, oh, that's that, or this is that, so, therefore, I need to do this. It's a reaction of the metals inside of the product itself. It's quite an old technology, actually.If you open up the circuit breaker, it looks like a mousetrap condensed.David RobertsYeah, tiny little mousetrap that's basically set off by heat or a magnetic field. You think about electricity these days. You think about all our sort of digital devices and digital controls. And it's a little bit wild that on every single line going to every single device, there's this mousetrap, just so old fashioned. That always struck me. It's so weirdly old fashioned. A little piece of metal with, like, springs on it that springs shut to cut off your electricity. So it's very mechanical. Let's say electromechanical, as you say.Ryan KennedyYes, very established technology that is, in today's world, relatively ancient from a technological standpoint. But, to achieve those basic results of circuit protection, they work. The basic results of circuit protection.David RobertsRight. And it's passive, as we say, just responds to perturbations, and, I guess you would say, dumb, in that, it doesn't know there's no awareness of what's happening or why it's happening. It's just metal expands, it flips, it cuts off.Ryan KennedyThat's correct.David RobertsSo there must be millions and millions and millions of these things. I mean, if there's one of these things between every electrical load and the grid, there must be billions out there in the world.Ryan KennedyLikely, yes. I think your first number was correct. Millions and millions and millions.David RobertsSo what you've done is make a digital circuit breaker, which works differently than the electromechanical. So why don't we just start with if it's not a physical reaction, if it's not a physical thing happening inside this digital circuit breaker, what is happening? How does it work?Ryan KennedyWe can dive into the technical and how it works, and then it'd be good to talk about kind of why we're doing that. So first, the technical. And the reason I say that is because, well, breakers work. Why do anything to them? Right? But technically speaking, what we've done is we've created a digital circuit breaker. More specifically, we call that a solid state circuit breaker. What that is is saying, hey, instead of using mechanics or mechanical devices, meaning like metal on metal, the things we just talked about to conduct electricity through a breaker, let us use semiconductors instead.So semiconductors are a broad ranging topic, but basically means that you can control current with a small digital input much like you can on your phone or computer, et cetera. But scale that up to power and say well, let's make a circuit breaker with semiconductors so that you can now interrupt, in the case of protection, the circuits when bad things happen with semiconductors instead of mechanics. With that, we overlay. So, what happens when you go to a semiconductor approach? It is very much an analog, as if you said what's the difference in a rotary phone versus a smartphone?It's making that leap all at once. Because now with digital control being semiconductor control at the breaker, it means that you can now put smart things inside of the breaker and make it do things and add value that it typically didn't have. That's what we're doing.David RobertsI just want to stress on the core function of shutting off current in danger. Even on that core function, it's faster. It's better and faster than a mechanical device. Is that right?Ryan KennedyThat's correct. By multiple orders of magnitude. So to give you an idea, we are, roughly speaking, about 3,000 times faster than most mechanical breakers in the market. That equates to two things. One is safety. There's some old footage of us, that we don't do so much anymore, of slapping hot wires together to kind of show that safety function. Don't try that at home either. So that's one thing which is actually quite important when you scale into larger buildings because there's more energy and more utility and short circuits can be explosive events. So it definitely helps in that regard.David RobertsAnd you say conventional circuit breakers work, but we should note that there are faults, there are fires, there are arc—what do they call them? Arc.Ryan KennedyArc flash.David RobertsWhatever—yeah. They're not 100%.Ryan KennedyThat's right. What's interesting about—not so much in residential although this can't happen in residential—but when you scale up to, like, the larger buildings, commercially in the industrial space and especially in data centers where the utility services are very large, you can have catastrophic events from short circuits that are balls of fire. Now, the breakers will open, but that doesn't mean a ball of fire didn't happen in the process. Right. So that does happen. I mean, in the worst case in my in my past life, I used to design buildings and also worked for, you know, a contracting firm.So I've seen, particularly in one instance in a high rise building where there was a short circuit in the electrical room on, like, the 19th or 20th floor, and it blew the doors off of the electrical room. And these are like commercial grade steel doors that got blown off the electrical room. So it's an amazing force that can be had when you get into the bigger buildings. But, I digress a little bit. It certainly eliminates that problem. Let's put it that way. Go into a semiconductor just purely based on speed.David RobertsAnd that's just because a digital signal travels at the speed of light. Right. And it's just faster than any mechanical reaction.Ryan KennedyYeah, inherently a semiconductor is going to be, like I said, including propagation delays and things like that within the compute and sensing, we're around 3000 times. And to give you an idea, that's in the microsecond range as opposed to millisecond range or millisecond spurl in the case of mechanical circuit breakers. Now, okay, micro milli. But electricity does move virtually at the speed of light. So arc flash propagates not quite that quick but pretty quick. Whereas that time really really matters. So yeah, the impact to the safety is effectively arc flash just doesn't happen on the output of our product, even in the largest utility services.David RobertsSo you get the basic function of the circuit breaker is faster and better. But then, as you say, you have this device that has semiconductors in it and you can put other stuff in there too. So maybe just describe like, I know what a circuit breaker looks like. It sort of fits in the slot in my circuit box, so I have the vague idea kind of what it looks like. What does your thing look like? Is it the same size? Does it, what is it composed of? What does it look like?Ryan KennedyToday, what we have on the market doesn't look so much like what you would see in your home. It looks more the size of a commercial grade circuit breaker. So can't fit in the residential panel yet, with a strong emphasis on yet, but we do have a similar form factor of commercial grade circuit breakers.David RobertsAnd is that just the difficulty of shrinking down little computers and stuff? I mean, is it that simple?Ryan KennedyNot quite the compute, it's more the power semiconductors that actually do the switching. So we're on this incredible curve that probably could take up a large portion of this conversation but also simplify it to basically mean that the world of power semiconductors is advancing quite under the hood actually of everything else that's happening. Power semiconductors are what enable electric vehicles to be as efficient and as effective as they are. Power conversion and solar—UPS has lots of things power conversion related. They are advancing at a pretty rapid rate from a power density standpoint. Power density meaning like how much power you can actually pack into that power semiconductor.So power density is going up, size is getting smaller. That plays into our own internal strategy as a company to optimize the form factor in the coming couple of years to where it becomes much more of a universal product that can fit into existing panel boards. But today, we have—it looks like a small box that fits into our—we manufacture panel boards as well, so you don't have to figure that out, but we figured all that out for you. Make panel boards, circuit breakers, everything as a whole system.I always say that there's two major components to a solid state breaker. There's a brain and a heart. The brain is the control system, the stuff that software defined, that makes the thing work, provides cybersecurity, things like this. And then there's the heart, which is the power semiconductor that the control system attaches to. Yeah, very much like a phone, in a way, in the sense you have a brain, you have a heart and a phone as well. And that combination creates a pretty powerful component. And electrically speaking, that's what we're doing in this space is really enabling far more than we used to.David RobertsRight. So maybe one way to think about it is that electromechanical, old school circuit breakers, only had hearts. And now you've added a brain to the equation.Ryan KennedyYou could see it that way. Yeah, absolutely.David RobertsAnd so if all these things are digital and if everyone has a little computer in it, basically, if we could think of these as tiny, tiny, tiny little smartphones, I know one thing that comes to people's mind whenever I discuss digitizing anything is security, cybersecurity. So if your power in your home or your commercial building or whatever, if every bit of it is running through a tiny little computer, people, I think, naturally wonder, like, what happens if they get hacked or someone takes over, can control the power flow through my entire building, et cetera, et cetera. So how do you deal with security?Ryan KennedyUltimately, circuit breakers are life safety devices. That's the core function. That's the phone call and the phone right? It has to make the phone call.David RobertsRight.Ryan KennedySo we're life safety devices. So when you shift from purely hardware to software defined hardware, in any industry, the right approach is that cybersecurity is the number one priority in software. That's been our approach the whole time. Now, there's a couple of ways to dice that. One is to say, the way we describe it is, there's Stuxnet and then there's hackers. And so we want to guard against both, and we call it Stuxnet as in, if you know what that is, that was the uranium enrichment thing that read all about that some other time. But the point is, in that case, the biggest threat is to make a critical device be something that it's not supposed to be or do something that it's not supposed to do.So that is priority one to say, okay, above all things, the breaker can't be made to be something that is fundamentally not and create an unsafe condition. So how we're attacking that is really good. I'll just tell you that, There's some secret sauce there that effectively amount to there's built in safeties that are still digital, but you basically can't get into under any circumstance. So that's priority one. And then the next priority says, okay, well, if we solve that, which we have, then the next one is to say, well, how do we keep folks from coming in and just say, shutting power off or doing funny things.Shutting power off is probably the number one funny thing there. But how do we prevent that? So, I'd like to say that in the world of software, there's this standard out there, and you follow that standard and you're good. That is not the case with cybersecurity for anybody. It's always evolving, and you're always trying to tackle it and address issues as we go along. But the core things that we do is end encryption on both software and hardware, which means that we have encryption elements physically on the breaker, encryption elements physically on our onsite management tools and cloud software.So that's actually quite critical, is to have the physical encryption as well as the software based encryption. There's many ways you could go about cybersecurity in the sense of many different entities have cybersecurity standards, but the one that we're headed towards now is called FedRAMP. That's really the direction we're headed from a standard standpoint. That's to do work for the federal government. Things like this, you have to be FedRAMP compliant or certified. So that's the direction we're headed. We're not certified, yet. We anticipate later this year we will be. But nonetheless, that's kind of how we've addressed it. That is one of those areas that I wish there were this, like, gold star. You got that. So everyone's good.David RobertsRight. Because there is a gold star in the circuit breaker safety. The heart part, the UL standard is pretty well...Ryan KennedyYeah, UL is kind of our FDA equivalent in the world of circuit breakers. Yes.David RobertsRight. And you guys have passed those tests?Ryan KennedyWe have. We're the first and only company in the world who have ever done that, for a solid state digital circuit breaker.David RobertsYeah. And one thing, I don't know if we mentioned this, but this made an impression on me when I first learned about it, so I just want to throw it out there. I think when people think of networked devices, they think it won't work without the network. So it's just worth sort of emphasizing, here, that every one of these circuit breakers has the firmware and the software and the operating system inside it. So it is, in some sense, a self contained little machine like, it does its thing, even absent networking.Ryan KennedyYes. We just call that fully autonomous. So, yes, they're fully autonomous devices.David RobertsRight. And one more thing I wanted to mention about the move from conventional to digital and circuit breakers is that this eliminates a lot of equipment that traditionally goes around circuit breakers in sort of commercial and high value areas. Sort of safety equipment that kind of gets larded around circuit breakers. So maybe just talk a little bit about that, sort of like the kinds of things that you've consolidated into one device here.Ryan KennedyYeah, absolutely. So it's worth stating that the easy part of the power distribution world or electricity is that, as we said, there's a circuit breaker that sits ahead of everything that consumes energy. The hard part comes in where if you look at, well, what do we actually do with electricity? All electrical things require really three things. So any application of electricity requires protection, visibility, and control. This is related to HVAC, certainly related to EV charging. In the case of HVAC, you have protection in the sense of a circuit breaker that feeds the HVAC system. Inside the HVAC system, you have a control mechanism that actually controls the flow of energy in its own little way. And then you have visibility either through software or through the thermostat. You could say the same thing for basically everything, electrically speaking. EV chargers, certainly same thing. Every EV charger that's been built out there, with the exception of Atom Power, is fed from a breaker, always, inside the EV charger, whether it's a pedestal or wallbox, there's visibility and control. And you could say the same about elevators and many, many other things that we use electricity for.So basically the way we look at it is what do we do with electricity? Well, we want to protect it, but we also want visibility and control. So what we've done is basically to say, okay, well, let's offer superior circuit protection, but let's also have the ability to have visibility and control because, well, that's what we do with electricity. All within the circuit breaker. And so I think you asked a sort of broader question like what are we doing that's kind of adding some of those things in. Inherently being a semiconductor device, it's easy to control the flow of energy. As simple as that sounds, that's monumental because it is extraordinarily difficult to make a circuit breaker that can universally control energy. Meaning, universally, as in the home or in the data center, or in a commercial building or industrial building with the same device.David RobertsYeah, we should pause here, just to add, because I don't know that we ever actually mentioned it, but physical circuit breakers, old school circuit breakers are also designed for a specific voltage, right? They're sort of locked into a specific voltage. Whereas if you're doing it with computing power, you can adjust to different voltages with the same circuit breaker. Is that right?Ryan KennedySo, think of it more as different amperages.David RobertsAmperages. Sorry, I get those confused.Yeah, it's okay. So if you go to, name your hardware store. If you go there and you go say, "I want to buy breaker." The questions are going—your menu, I should say, is going to be, well, do you want a 15 amp, a 20 amp, a 25, a 30, a 40, 50, 60, etc. And then, you know, you, you buy that product for what it is, say, call it a 30 amp breaker to feed my, I don't know, hot water heater. That's going to be fairly typical. It's always going to be a 30 amp breaker forever and ever and ever. Which means from a UL standpoint and a safety standpoint, you can only put that on 30 amp circuits.Right?Ryan KennedyI will say, yeah, that is an interesting benefit that I think evolved along Atom Power's way, which says, well, now that you become a digital circuit breaker, you can effectively be a lot of circuit breakers in one, which is what we do. And you can program our circuit breakers from 15 amp all the way up to 100 amp. And it's you all listed for each increment in between. So that's pretty powerful when you consider, roughly speaking, it depends on your metric. About 90% of the breakers on the planet are 100 amp and less. So we're hitting a huge market with one single product.David RobertsRight.Ryan KennedySo that's certainly one thing from a protection standpoint, and thank you for reminding me, on that. That is a feature I often gloss ever, and it is unique for what we're doing. But the visibility, obviously, through the software we have and the ability to see the breaker and control the breaker is the other thing. And to be able to tell the breaker what it is. And I think that's the key thesis within Atom Power, which is to say, well, let's not just create a digital breaker, but let's create it in a way to where you can tell the breaker what it is instead of buying a breaker.Well, because you have to for protection and then having to buy a specific built appliance for the application that you need to perform, like EV chargers are a strong symptom of that.David RobertsThis is a perfect segue here because the first time we talked years ago, I think you were sort of messing around with big commercial facilities and industrial buildings and kind of a little bit all over the place, but you just got $100 million investment to do, specifically EV charging applications. So tell us why all these things we're hearing about digital circuit breakers, why they're specifically well suited to EV charging.Ryan KennedySo you're right about the earlier engagements we had, with great customers, were in the industrial space, primarily. Certainly prior to the investment, we saw a need, a major pain point, when it came to electric vehicle charging at scale. So charging vehicles has been around quite some time. For the longest time, it's been relegated to if it's outside of the home, to be candid, often optics put a couple here, a couple there just to have them. Right. But as we've progressed, particularly in the 2020s, here we are seeing, and we saw this is why we're in this space is we saw this, that there were some major, major problems with charging at scale.Meaning like, instead of a few chargers put in hundreds into a single facility or complex, heck, even tens, but certainly in the hundreds, things become really problematic really fast.David RobertsAnd that's fleets. We're talking about basically fleets.Ryan KennedyFleet, multifamily, and hospitality.David RobertsRight.Ryan KennedyYeah, anywhere where you're going to have lots of chargers. But yeah, particularly fleets, always need lots of chargers. Multifamily, as well. So the problems start becoming quite extreme in those cases. To give you an example of what I mean by this, we, we have a project up in Queens that is roughly now it's, you know, close to 700 charging stations that's going into generally the same location that is on the same, you know, substation grid, network, etc. If you do the math on that, you're basically connecting up to between six and 7 megawatts of potential load onto that grid, just in that.So appliances don't solve that very well, which is more or less what level two chargers are today. There are appliances that sit in front of the car and you plug it in. When you start talking about that scale, it's really critical that your infrastructure is the smart thing that can actually solve pain points such as, hey, how do we not do that?David RobertsHow do we not have a bunch of cars charging at once and overload basically the substation, because you could fry a substation if everybody like if you had 700 chargers going all at once.Ryan KennedyAbsolutely. Things like that. Things like me as a customer, how do I not spend the amount of money that you would otherwise spend on the infrastructure alone to make that happen? Meaning transformers, wires, switch gear, things like that. And then, with that much energy, how do you not just say, don't overload the grid, but how do you actually, effectively, energy, manage in real time against things like peak loads, or peak demand, or time of use and keep energy cost as low as you can and charge during the right times of the day and when there's a grid event and things like this.All that requires real time infrastructure intelligence.David RobertsRight. So the EV charge has to be networked with one another. They have to be communicating with one another, basically. Is that not something they can do now? If I'm looking at a fleet with a bunch of chargers today, are the EV chargers just freestanding, isolated, or did they talk to one another now in other ways?Ryan KennedyYeah, oftentimes they are. But there's where the problems really started was in the fleet, because that started becoming apparent, right, the more that they were putting in. To answer your question, can EV chargers today, outside of Atom Power, talk to one another and do some level of energy management? The answer is certainly, yes. That's the start of the conversation though, the devil in the detail says, okay, put that in and make it code compliant with our national electrical code and get the inspector to sign off on it and guarantee the billing owner that that's going to operate always, no matter what, safely. There's where things get problematic.So, if you are the life safety device and you're already connected and you got to buy a breaker anyway, for each EV charger, things become so easy to do. Now it's built into our panels breakers. It means the National Electrical Code to the t. Inspectors have no problem with it. And there's a lot of things that become super easy all of a sudden. So without going into a ton of complexity, being the infrastructure, being the breaker, being the panel board where the breakers sit, makes it super easy to solve those major pain points with very little effort from the customers' standpoint.David RobertsRight. And I think the way to think about this, and kind of what turned the light bulb on for me, is if your intelligence, your software, your coordination, et cetera, is in the circuit breakers that are in the circuit board, that means the EV chargers themselves can be dumb. So that like the things that are out there in the parking lot can just be dumb conduits. Right. Because the control is elsewhere. And this is something that's always struck me about the EV charging space. It's just like you have these, today, you have these like really incredibly complex high power computers sitting out in parking lots. Which always kind of struck me as a little bit insane, that normal customers are interacting so directly with something so expensive and kind of complicated.Ryan KennedyWell, you're hitting on the next pain point, which is, again, at scale that becomes very problematic that your most expensive asset in that ecosystem now sits in front of the vehicle, typically outside.David RobertsRight.Ryan KennedySo the second question outside of the infrastructure cost is how do we not do that? Can the pedestal or wall box be—wallbox not the brand, but box...electrical—can that thing be very low cost, low maintenance, zero maintenance, preferably? Whereas if it did get damaged, really nothing happens, other than I can easily replace it. And the answer is yes, because... Yeah, you're right. And once you become intelligent infrastructure and you sit safely back in the electrical room, the pedestals that have the cord sets on them become very dumb in air quotes. But the system is really smart.David RobertsRight. I'm curious what sorts of things having this kind of central intelligence, controlling multiple EV chargers can do. We mentioned it's going to prevent, whatever, 700 cars from charging at once. That's the kind of baseline it's going to prevent so much power from running through the system that it fries the grid it's on. But what else can you do with that sort of central computer control?Ryan KennedyYeah, so I would say there's a ton, but the highest value ones are going to be certainly in energy management that we've been talking about here that relates more to than just to saying, hey, prevent 700 cars from charging at the same time. It says, hey, you know what, let 700 cars actually charge at the same time, but let's intelligently distribute so that they can all get a charge and not cause major problems and major electrical bills. So that's one, I mean, I would say the other one is it is extremely easy to create a campus environment as well with the system. It kind of relates to what we spoke of earlier. Like the network connectivity is completely different from any other system, as in like it's really easy to do. So it's very easy from a campus wide perspective to say, hey, how do I connect this campus of chargers to a single system, single pane of glass that also does energy management, that also saves on electric bills, things like that. So things become very easy through that network piece.There is another element to it that says, well, kind of goes off. The programmable breaker to some degree is when you buy an EV charger today. This is another pain point. Again, at scale, it can sometimes also be a pain point, not at scale, but when you buy one today, it's fixed. In other words, level two charging, which is most of the charging, goes all the way up to 80 amps. All right, so just take that as a number. Well, if you buy a charger, it's going to come in several different flavors. You can get a 24 amp charger, you can get a 32 amp charger, a 40 amp, a 48 amp, and then on rare occasion an 80 amp because 80 amps kind of hard to do for various reasons. There's just less of those.But nonetheless, what you buy is what you buy and you're stuck with that. So if you buy a 32 amp charger, which is most of them on the market, that's it. You're not going to get 48 amp, you know, that a Tesla needs. You're not going to get 80 amp. That a Ford f 150 needs. You got 32. So you're probably picking up this a little bit, that with a programmable breaker now, on the other hand, what I can do is we can just simply go the full range of charging through the same product.David RobertsRight.Ryan KennedyYou're buying a full level two now, regardless. You just tell it what it, again, tell it what it is. And that can happen real time. You know, I could start off as 48 amp charger and then move up to an 80 amp charger, you know, a couple of years from now as more demand picks up for adm charging with the same infrastructure with no stranded assets. And that's absolutely critical. So let's say that's another one.David RobertsSo I got the intelligence is in the circuit board and they've got these sort of dumb chargers out in the parking lot. So like a bolt could pull up and charge at that charger and the circuit board knows the right amperage level. And then an F-150 could pull up to the same charger and get more charge because the circuit breaker knows.Ryan KennedyCorrect. But it's not enough to say, because you were mentioning network a minute ago. It's not enough to say, well, a programmable breaker alone solves that. It solves a major chunk of it, which says, well, I can now program my system to be 80 amp, not 48, yes. But there's another element to it which says, well, to do that, then again, think of that example of 700 chargers. Now, if I, if I boost, say, these chargers over here to 80 amp, say, call it 50 of them, right?David RobertsRight.Ryan KennedyNow, the entire system has to communicate amongst itself because, well, they sit on the same utility to say, well, oh, those have 80 amp now. So we need to see how we can spread the rest of them intelligently, so these other folks get a charge while these get an 80 amp charge. So it's still a system level network event. Right. And we make that easy and out of the box effectively. Whereas it becomes extraordinarily difficult, if not impossible, the way things have been done today.David RobertsRight. Because I guess if you're buying multiple ones today, you're just sort of bricolaging them together piece by piece.Ryan KennedyCorrect.David RobertsSeems a lot more like people are being asked to kind of wing it a little bit. And as I'm sure you know, as having interacted with customers, if I'm just like an owner of a hotel or whatever, I don't want to know, you know what I mean? I don't want to have to think about this much. I just want to plug something in and have it work. There's not going to be a lot of electrical systems management from these customers.Ryan KennedyYou are absolutely right. And that brings us to probably, I would say, the core of how we're personally selling, but also what we're seeing the market in this space look for, which is EV charging is one of those unique animals you mentioned, hospitality, where it's unique in the sense that if you offer it and it doesn't work, the perception of your facility becomes different.David RobertsRight.Ryan KennedyIf the lights out or the TV doesn't work in the hotel room or something, it causes nowhere near the impact that your EV charger not working does. There's various reasons we think that is. But anyway, so what's happening is and you're right, those hotels, especially hotels, don't want to think about this stuff. So being able to package it up in a way that is highly effective out of the box and by the way, extraordinarily reliable. Because we're a breaker now, we're falling to a completely different standard. That becomes absolutely critical that you have a super reliable, super easy...I don't have to think about energy. I don't have to think about demand. I don't have to think about this stuff, from a hospitality, or multifamily, or fleet perspective...that becomes a very powerful thing. But it's a culmination of kind of all the is stacked on top of one another. Smart breaker panel connected, dumb pedestal system level approach.David RobertsRight. And this is like if I'm the hotel owner, do I just plug and play and this thing runs itself forever...or is Atom involved, somehow, in monitoring and running? Are you involved in operations at all? Once you install these things, who takes over operations?Ryan KennedyI'd like to say we have a singular way of selling, but it's such an early market still that we don't. We sell all the way down to just hardware. All the way up to full managed services. So we have a 24/7 network operation center within our facility that we monitor key customer assets that we have service agreements with, particularly in hotels. That's one of those sectors that ask for that frequently because the hotels don't...they want to equate EV charging rightfully so to WiFi. You don't think about the router. Yyou don't think about gigabit or whatever that is. It needs to just work. I can connect to it, and it works. That's it. That's all I care about, rightfully so.David RobertsAnd one other question about these EV control systems. Obviously, the first thing on everybody's mind is the sort of EV facing part of it, managing which vehicles are charging and how much at what time. But of course, if you have this intelligence and software you also could think about communicating with the grid. And so, I wonder how much, because once you are getting up to 700 whatever. I don't know why we picked that number out. 700?Ryan KennedyIt's actually a project we have up in New York.David RobertsOh yeah. Well, you've got 700 vehicle charging stations and 700 vehicles charging, potentially. You've also got a fairly large dispatchable, at least somewhat controllable load, which seems to me could be quite helpful on some congested grids. So how big of a piece is the grid facing intelligence in these things? And I guess some of that depends on utilities and whether they're ready to do this kind of thing but I just wonder are you sniffing around in that space?Ryan KennedyI would say the way we're approaching it is, to answer your question, your hunch is dead on. That is a major utility concern at scale is to be able to have some level of at least visibility if not some level of demand responsibility in those events. We're not starting there, really. We're starting to satisfy what customers need right now, like, what are the most important things for them in the sectors we're in. So we see that as an evolution and it is happening. We are engaged in multiple utilities, just to put that out there. But today it's not so easy to say okay, well let's control that.What first needs to happen is customers need to start utilizing. The utilization picks up, that utilization picks up more. Then those discussions, the real, like, "what do we do about it" discussions will start happening with utilities we predict.David RobertsIt's going to force the question. If you've got 700 vehicle loads coming on and off your grid I mean, you kind of really can't just ignore that.Ryan KennedyThat's true. But with the evolution of electric vehicles and the adoption rate, all 700 aren't going to be on today. I think that's the point is, like, as more and more vehicles come onto that system—in relatively short order the next couple of years—then things become more apparent. Right. Then things become more potentially problematic for the utility. And we do expect that there's an engagement with the utilities, at various levels, for some sort of a demand response tie in. We certainly see that, but we're not day one pitching that as part of—the product is capable, absolutely capable—it's just the connection rate from the vehicles to the chargers has to pick up more and more and more and then eventually that will begin discussions once it becomes problematic for the utility, but not before it becomes problematic, typically.David RobertsYes, that sounds right. So you're out there now selling these systems, these EV charging systems to fleets and campuses. I'm sort of curious, who are the customers so far? What sectors were most eager for something like this to exist?Ryan KennedyWell, they initially fleet, so think parcel pickup delivery fleet. That's where we kind of started off our sales, was there. Multifamily is a close second at this point because they have the same pain points. They both need to have lots of chargers and they both have pain points associated with, well, effectively becoming a gas station. Trying to minimize costs associated with that.David RobertsRight. Yeah. There's one other thing I forgot to mention when we were talking about this earlier, that since you mentioned multifamily, I'll just throw it in here. Another sort of interesting application of this is if you own condos or apartment buildings or something, you might want to have certain chargers dedicated to certain people. Or you might want to have certain chargers that are available only in certain times of day. Or you might want to have one charger that's shared between two people who live in your apartment building. And all of that is of course, you can do, if you have this central control system, you can do a lot of micro fiddling with the individual spaces.Ryan KennedyYes, already built in, super easy to do.David RobertsAnd so the EV charging space is a very obvious application of this. A place where some central control of multiple devices is most obviously needed, and the demand is rising very quickly and that whole industry or set of industries is in really kind of like it's a crazy time of ferment in and around that stuff... But as we emphasized early on, as I emphasized when I wrote about this back in 2019, really there's no end to the possibilities here because the way I think about it is every single device on the grid is connected through a circuit breaker. And so if circuit breakers can become smart computing devices, then basically every device connected to the grid becomes smart or at least somewhat smart, without having to put all that programming and smarts and computing power into the appliance itself. You're putting the intelligence in the connection to the grid. I don't know, the more I think about this, the more it kind of blows my mind. That what you could do, eventually, if some substantial portion of the millions and millions and millions of circuit breakers in the country become smart. I don't know, it just seems to open up like the sky is the limit kind of thing. So I'm just curious, like, you're moving into the EV space for obvious reasons. It's hopping. There's a serious demand for precisely this sort of thing. But do you have plans?Like what's next after that? Because I could just think of a million different...Ryan KennedyWe do, as I think, hopefully, the listeners have picked up and I think through our conversation here, it's probably become apparent that EV charging for us is viewed as an application of the breaker, but not as the thing.David RobertsRight.Ryan KennedyMuch like many other things are. That will be scaling in the near future, in a way that is unique, in a way that is very easy and primarily of which becomes truly universal. So we are, you know, evolving product into a form factor that, you know, like we're universal today from a product standpoint. In other words, you can put us in any building, anywhere, it doesn't matter, same product, and we're capturing 90% of the breaker market doing that. But we're in our own panel. As we evolve, that will shift into a form factor that fits into most panels, at least in the US. And can be adapted for the European markets and add further ability into the product to effectively be able to tell it what it is.So we see a future. That the breaker that you have to buy anyway, instead of going and buying a meter or a control device or EV charger or industrial control, whatever it is, you just tell the breaker you're that thing, and it does it. That's the world we see. Now at scale, at extreme scale, I always like to think in kind of polar extremes, extreme scale of that, because consumption defines the grid, not the other way around, is you effectively could have control of the entire grid.David RobertsYes.Ryan KennedyAlso obsolete about 80% of the electrical products on the market at extreme scale.David RobertsThat's the other thing I was thinking about is like all those things you're talking about building into the circuit breaker. Those are entire freestanding industries, like long standing industries. This is a huge amount of stuff, consolidation here, if nothing else.Ryan KennedyCorrect. I think what we're trying to do is—I hate to use the phone analogy, but it's very similar, but in a little different way—is that we are looking to electrically speaking, unify the applications and unify the customers into one platform. I mean, many other industries have done that most visibly, the phone. The applications and the phones get used by everyone. And we want the same to happen in the electrical space. That there's this massive gap...that there are more electrical products on the market than probably any other industry because just over time, as the industry has evolved, we've just made specific things for specific applications for specific customers.David RobertsRight.Ryan KennedyThat's what EV chargers are. They don't have to be that way, right? The breakers have always been there, but it's not thought about much. So let's make that thing that actually does it since, well, it's part of the electrical system, right? You have to buy it anyway. It needs to be there. So let's make that the universal thing. And I think that's where you mentioned the investment. I think that's probably where Atom Power differentiated. Because if you were going to go make that kind of investment, the 100 million into, say, an EV charging company, the problem is it may not be a problem, but I mean, the way we look at it is, well, that's all that they do.The product charges a car, you can't use it for this, you can't use it for that. That is it. That is what it's going to do. Whereas Atom Power, it's like it being an application of a universal device, means that, well, as we see this market over here take off, we apply to that market and we see this market over here, but we apply to that market. Why? Because all of them require breakers.David RobertsRight? So, like a facility with a central circuit board controlling multiple EV chargers, there's no reason that it couldn't plug other types of ICEs into that same circuit board, and it could coordinate all of them alongside the EV chargers, with the EV Chargers. There's nothing EV specific about it.Ryan KennedyExactly.David RobertsI'm thinking about scale here. One of the things I think people are starting to become familiar with are sort of smart panels at home...like this company, SPAN, has the smart panel...which is sort of doing in the home what you're talking about doing with EV chargers at big facilities, which is just controlling loads and balancing loads and timing things and all this kind of thing. So in a sense, a smart panel like this, in the home, would kind of make the home into its own little micro grid, right? This own little independently managed micro grid.And I'm curious about scale. What does it look like as you scale bigger and bigger? Is it just stacking these little circuit breakers on top of one another to eternity?Ryan KennedyThat's actually a really good fundamental question, is that breakers cover a large swath of land when it comes to electrical space, right? They go all the way from, you know, technically ten amps in the US. All the way up to 5,000 amps.David RobertsWhat does a 5,000 amp circuit breaker look like? Is it..Ryan KennedyA refrigerator, basically.David RobertsRight.Ryan KennedyBut, but the point is, is like, you know, when you get into big distribution systems, you start off with a goliath utility and you finally work your way down to the small, what's called Brandt circuit breaker. That basically means last breaker in the system. That's where we play, is in that Brandt circuit breaker, meaning the last breaker in the system. And like I said, 90% of those are 100 amp and less. And so you capture that market, you effectively capture most of the grid, you know, at scale. So in other words, it's like saying 100 amp and less, 90% of your loads are on that, you know, and that's what we focus.David RobertsI mean, if you let your mind drift in sort of futuristic utopian direction because I think about this stuff a lot. It's like what sorts of things do you think could be unlocked? What sorts of things do you think could become possible? When it's not just, you have this occasional smart load here and smart load there, but suddenly the bulk, the majority of the loads on a grid are smart controllable. I'm just curious what you think sort of like the emergent big picture effects of that will be like what will intelligence do for the grid on kind of the macro scale?Ryan KennedyI think as you scale out, especially at the extreme end, you can do some pretty granular things, like, neighborhoods, electrically, are talking to one another, and that becomes apparent where you can shed load without interrupting someone's life and save a substation or save another generator from having to come online. It kind of speaks to demand response, but in a different way that says it's not brute force, shut things off. Instead, let's all talk to one another and know that, hey, the conditions look like this. This home is unoccupied, likely because the electricity consumption is so low.The imagination, there's no limit. This is the thing, again, because the consumption of electricity is what defines everything else...is once that becomes a unified platform and understandable ecosystem made of billions of devices, that becomes very powerful in ways that I don't think we've even thought about yet. But at a high level it means that now, electrically, you can speak to one another, and it's not like by home. It's not like my home is pulling 20 kilowatts, your home is pulling 15. That doesn't tell you anything. What does tell you things is the patterns of usage, of EV charging, of HVAC, of hot water, of lights.There's a lot there that, at scale, gives you a ton of intelligence that you can do a ton of things with, that I think the sky is the limit.David RobertsYeah. At the base level, you are ensuring that every bit of electricity that's generated is used efficiently.Ryan KennedyCorrect.David RobertsAnd that alone is going to just take a huge whack off. I feel like the demand for new power plants and new capacity, you're going to be able to avoid a ton of new generators and new, maybe even new high voltage lines just by using the electricity you've got.Ryan KennedyYeah. You just hit the core of the company, our company's thesis. This is actually what we were founded on...which was in the future, and we started in 2014, there was going to be this probably once-in-a-century event of transferring a lot of energy—think of that, not electrically, just pure energy onto the grid.David RobertsYeah.Ryan KennedySo that's happened. It's certainly happening now. I think we call that the energy transition now...But we had this thesis in 2014 where we said, well, you basically have like three options there, because the grid can't sustain that level of what we were predicting what's going to be transferred on the grid, primarily by vehicles. You have kind of three options. You either create more generation, somehow, even though we're reducing generation through baseload like coal and natural gas, rightfully so. You either do that, which is going to be really hard to do, or you have large scale energy storage combined with solar, which we have one of those, not both, solar, not so much energy storage, or you have large scale demand response. But the way to do that is through a universal method, not, not a disaggregated, like, you know, thermostat adjustment or smart EV charger here, but not there thing. It has to happen at a macro level scale, at the infrastructure level. So this is fundamentally why we actually started down this path, is sort of seeing that need in the market in the future. And this was 2014.David RobertsThis comes up over and over again. You talk about transferring the heating load in the frigid Northeastern part of the country to electricity. That's A) a huge load, and B) the timing of that load is very different than the timing of the load it's adding onto. And that's just, you either meet that with brute force by building a shitload of new generators and power lines and everything else, or you just got to get much much much smarter about how you use the power you've got.Ryan KennedyYeah. And the low hanging fruit, at least conceptually, is that you can be a lot smarter. But it's hard to actually execute on that without a universal platform that fits all industries—which at the end of the day, because again, everything's fed from a circuit breaker—that needs to be the thing that is innovated on, not a new appliance. But it's really hard to do that, super hard to do. I could go into why breakers are hard to actually innovate on, but nonetheless, it is the hardest path to pick.David RobertsBut you're there for a big chunk of applications and can see, at least in the future, a form factor small enough to go into residential boxes. Right.Ryan KennedyYes.David RobertsAnd once it's in the box, it's programmable, which means it's not the same thing. It can be, like you keep saying, it can be a bunch of different—once it's in the box—it could be whatever we need it to be as needs evolve. This makes such sense to me. Like I remember when I first encountered it back in 2019, I was like, yeah. If you have one kind of device that is required for every single electric load, then why not make that the device that's smart, instead of creating new smart devices for every different kind of load. Why not just make the one lego building block, that's the whole grid, make that smart and then you've got all your smart devices in one? Seemed sort of like a smack your head obvious kind of thing to me. So why are you still the only one with a certified digital circuit breaker? Like I would think other people would be moving in this direction sooner or later.Ryan KennedyYou know what's interesting is that, I will tell you this, we were not the first ones to come up with the idea of a salt tape breaker. The idea of that actually is quite old. Traced this back to the mid-80s, of a semiconductor based circuit breaker by some large companies. So two things. One, is, I think, the natural question after that would be well, like okay, well, "why didn't anybody do it?" So, I think, there was probably—let's start there. There's probably a couple of things. One, is that the circuit breaker space is an interesting one. It really is. And the reason is because it is a super old industry. That's basically dominated by four companies, across most of the planet, who have all been building breakers for over a century each. That's just kind of the nature of this industry. So by the way, worst pitch ever. Hey, we're going to build a new breaker, where four companies dominate the planet, and it's all hardware and life safety, side note. But anyway, the point is it's a unique industry in that sense. So I think probably there were some "The Innovator's Dilemma" there a little bit because once you establish a means and methods and that's how things are done, it's really hard as a large company to move away from that and disrupt your own business.David RobertsYeah. And it seems like building tiny computers is very different than building tiny electromechanical devices.Ryan KennedyYeah.David RobertsI don't really know very well, but it doesn't seem like a lot of transferable knowledge.Ryan KennedyIt's definitely a different field. Right? I mean, once you say hey, let's build a solid state breaker, you now get into the realm of power semiconductors and physics that don't haven't historically applied in traditional circuit breakers. So, there's a few things. I think one is there were some enabling technologies that evolved since the 80s like computing, especially, in sensing and speed and power semiconductors, certainly. But I think the other piece of that is a bit of "The Innovator's Dilemma" that says, well, if I'm a company who's making breakers, but I'm also a company who's making industrial controls, and I'm also a company who's now making EV chargers.David RobertsRight.Ryan KennedyIt's so difficult, so difficult to say, well, why don't we just make that one device.David RobertsAnd cannibalize all our other product lines.Ryan KennedyYeah, look, rightfully so it's difficult. Because if you've been set up that way and your company evolved that way, I mean, they're full of smart people... It's a structural challenge, right, to go do that. So I think Atom Power came out would work in a way, and that we're all from the industry. Me, specifically, I was an electrician, so I kind of used to design buildings. So I would like to say I think Atom Power had a view of the world that was much more simple and holistic, that says, well, "why should products be defined by the application? Why can't the product define the application?" Which seemed just a natural question. But then we started from there. I think that there are since Atom Power, there are emerging, I would say, technologies within established companies, as well as some startups who are trying to do effectively what we're doing. My view on this, is we welcome it because, coming from the industry, we believe what we're doing is the right thing to do. We also know we can't service every single customer base on the planet.David RobertsIt's millions and millions, as previously discussed. Well, I'm curious, if somebody, if another company makes a digital circuit breaker, do we know already that it will communicate with yours? Or does that remain to be hashed out? Like, is there a standards are there standards issues here?Ryan KennedyWell, it depends what you mean. I mean, there's a UL standard now that basically Atom Power defined the path for and establish with UL.David RobertsBut I meant more of the software kind of intercompatibility. I don't know anything about software, so I don't even know what the question is. But insofar as this is meant to be a universal system, is it going to all be operating on the same sort of software protocols?Ryan KennedyYeah. Yes and no. So we do see a world where from an application standpoint, in other words, if you're say a facility manager and you have one pane of glass you're looking at for software, interoperability between devices is going to be necessary.David RobertsRight.Ryan KennedySo the way we structured our product is that the sort of core firmware and stuff is proprietary because, well, it's hard to open source that, because it's life safety, it's UL. It's like there's a lot of whizbang stuff that happens in the breaker to make it do what it does, but then the layer on top of that which says, well, okay, well, let's set this up as an EV charger, that layer of software, we're open protocol and API based, as well. So you could tie even today, you can tie an existing building management system into our software, for example, the way it should be for other manufacturers if they come to the market. We haven't seen you actually come to the market, yet, because, like I said, it's super hard to do this, and I think it takes so much time and energy. Atom Power is dedicated years to this, at this point. It's a hard thing to do.David RobertsWas there any sort of public policy assistance or is this all private investment, and are you making money now? I'm curious because a lot of industries, when you're going up against a super giant incumbent industry, you need help to cross those first few humps. Has this all been private money so far?Ryan KennedyIt has, yes.David RobertsAnd you're out selling things for profit now. You don't feel like you need any help.Ryan KennedyWell, I mean.David RobertsNot like you're going to turn down help if...Ryan KennedyWe always welcome help, but in the form of investment, we're capitalized for quite some time at this point, and our goal is to not ever need to raise funds again. That's kind of... So we need to be... We are post revenue, not pre-revenue, but as a company, we have to get to a sustainable level of profitability, right? Because from an investor, in a markets perspective, the markets are very harsh right now on companies in the new energy space. There's many publicly traded companies, especially the ones that went this backroute, you can see this on right now, which is kind of a Goldilocks scenario because it's a high growth market, yet if you're not profitable, investors are punishing you on valuation, specifically. So we need to become a very profitable company in this space, but to sustain ourselves and to continue to grow products, organically, right, and not continue to raise money. That's what we're headed towards.So my point is, it's really hard to make money in the energy space, as the markets have shown. So the best companies are going to be the ones who have a sustainable technology, but also a sustainable business model to where they can take the profits and continue innovating, to further advance and create solutions to the major pain points that are out there. I mean, this is our thesis. Like, we have to become a profitable company.David RobertsThis is really fascinating to think about the sort of these lego blocks that are really kind of composing the entire grid—thinking about all of them getting smart is really just, for a sort of grid geek—really lets your mind spin off and all sorts of interesting directions. So, thanks, for taking the time and explaining this all to us, and good luck in your next steps.Ryan KennedyDavid, thank you. I really appreciate the conversation today.David RobertsThank you for listening to the Volts podcast. It is ad-free, powered entirely by listeners like you. If you value conversation 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

A newly signed state law sets Minnesota on course to use 100 percent carbon-free electricity by 2040. In this episode, Minnesota House Majority Leader Jamie Long describes the decisive legislating that took an ambitious climate bill from introduction to the governor’s desk in the space of one month. (PDF transcript)(Active transcript)Text transcript:David RobertsBack in 2019, I wrote for Vox that there is one weird trick states can use to ensure good climate and energy policy. That trick is: giving Democrats full control of the government. It has worked in California, Washington, Oregon, Colorado, Illinois, New Mexico, Massachusetts, New York, Hawaii — the list goes on.As I covered in a pod a few months ago, the 2022 midterm elections brought Democrats full control — with trifectas of both houses of the legislature and the governor's office — in four new M states: Maryland, Massachusetts, Michigan, and Minnesota.Does the one weird trick still work? Well, you’ll never guess what happened in Minnesota last week. Gov. Tim Walz signed into law a historic piece of legislation that would set the state on a course to carbon-free electricity: 80 percent by 2030, 90 percent by 2035, and 100 percent by 2040.My guest today is the bill’s primary author and sponsor, Minnesota House Majority Leader Jamie Long. Long, formerly legislative director for then–U.S. Rep. Keith Ellison (D-Minn.), was elected to the Minnesota legislature in 2018 and became majority leader this year. He worked closely with Senate sponsor Nick Frentz to shepherd the bill quickly through the legislature, with no extended conference committee. It was an adept and decisive bit of legislating — not necessarily the norm for Democrats. I was excited to talk to Long about some of the ins and outs of the bill, the forces that supported and opposed it, and what's next for Minnesota energy policy. All right, then. Representative Jamie Long of Minnesota, welcome to Volts. Thanks so much for coming. And I guess the first thing I should say is congratulations.Jamie LongThank you. It's a big month out here in Minnesota.David RobertsYeah, big news. I want to get into the actual bill and the actual targets and everything, but just let's do a brief bit of history to start with. You arrived in the Minnesota legislature in 2018. I'm curious when this bill was born, basically, how long has this been cooking?Jamie LongSure. Well, this was my top-priority bill from my very first day I ran for office wanting to work on climate change and clean energy, and knew that 100% clean energy was the big bill that I wanted to focus my efforts on. So, we introduced this pretty early in my very first year in office. So actually, when we had the bill signing, I was looking back, and it was about four years to the week from when we had a bill signing that I'd introduced it. So, that was the first time we'd had 100% clean energy proposal in Minnesota, but we certainly had a lot of other renewable energy standards that had been tried and had failed over the years. The last time we'd updated our renewable energy standard was 2007 in the state.David Roberts2007. And that was, I'm guessing, the last time you had Democratic control over both Houses?Jamie LongNo, in fact, it was broadly bipartisan. It was signed by Governor Tim Pawlenty, Republican governor, who later it became a political issue when he ran for President because the Republican primary voters were not that happy that he was a clean energy leader who took climate change seriously. But it got such broad bipartisan support, it was almost unanimous in the House and Senate at the time.David RobertsWild.Jamie LongAnd that was 25% renewable energy standard by 2025 was what was passed at that time. That seemed really ambitious, but we actually met that in 2017, so we met it eight years early.So, at the time it seemed like it was going to be a big deal.David RobertsIf only we would ever learn from experience.Jamie LongI know, right?David RobertsThat's the same story with every single one of these that's ever passed anywhere.Jamie LongThat's right. But we do have only the second trifecta in the last 30 years in the state. We did have one in 2013, 2014. We didn't update the renewable energy standard then, but we did do some other good climate policy. But yes, unfortunately, since 2007, climate and clean energy has taken a turn for partisanship in the state. And so it has taken until we got this trifecta, and we have it barely in the Senate. This will sound familiar to the congressional story, but we have a one vote margin in the Senate, and we have a two vote margin in the House.David RobertsCrazy. And this was pretty rapid and decisive. Like, you guys have not been in office for that for that long.Jamie LongYou got it. Signed within a month.David RobertsThat's unusual to see the Democratic Party acting with such alacrity and clarity of purpose. I don't know what's going on here.Jamie LongWell, we felt like we heard loud and clear from Minnesota voters that this is what they wanted. There was a poll in our local paper right before the election asking voters what were their top issues for deciding on the candidates that they wanted to support. And climate was a top five issue.David RobertsNo kidding.Jamie LongOur governor, Tim Walz, has been a strong supporter of 100% clean energy since day one. He was at our very first press conference with us four years ago, and he ran on this this past election cycle for his re-election, it was in his first ad. He was one of those Democrats back in the Waxman-Markey days who voted for Waxman-Markey and thought it might have cost him his seat, and it didn't. But he's always been very proud of his climate leadership and has been a really strong leader in our state.David RobertsSo, I want to talk about some of the issues of contention, let's say in a minute, but let's just start by talking about what's in the bill. So, there's two targets for the state utilities. There's a renewable energy target and then there's a zero carbon target. So, tell us just briefly, like why are there two and what are they?Jamie LongWell, we wanted to have a renewable energy baseline. That was important for a lot of our partners and constituency groups that we were working with. We do have nuclear energy in the state, there are three nuclear plants, all owned by Xcel Energy. So, this wasn't really relevant for most utilities, but we wanted to have a baseline for renewable energy. So, there's a 55% renewable energy standard by 2035. But the big numbers are the clean energy standards or carbon-free energy standards and those are 80% by 2030, 90% by 2035 and 100% by 2040.David RobertsGot it. So, the renewable energy target is just an extension of the previous law? Yes, it's just sort of an updating of the previous renewable energy law or does it change anything substantially from that law?Jamie LongWell, it updates the previous law. So as I'd mentioned, our current law has 25% by 2025 and everybody's gotten there, so there's no real story there. So we have 55% now by 2035. We did update it some. The renewable energy definition at that time had a couple of things that we tweaked. One was that it constrained hydro to only small hydro. And the thought had been at that time that there was some concern that if we did large hydro we would basically push out all of the wind and solar. We would just go towards large hydro or we have access to Manitoba Hydro here and some other large hydro projects.And so the concern was that you wouldn't get the solar and wind development that we would want. That's less of a concern now. We aren't seeing a lot more large hydro projects being built. And particularly on the timeline that we're talking about, between now and 2035, you're not really going to get a new large dam sided and constructed. So, the question was just really, were we going to let that count for utilities that are already purchasing large hydro? And we thought that would be fair. And then the other discussion was around waste energy. And so we have a facility in my city of Minneapolis that is located next to the neighborhood that has the highest black population in the city, and also happens to have the highest asthma rates in the state, there's a lot of cumulative impacts with different industrial uses in that particular neighborhood. And so we excluded that particular facility from the definition of renewable energy.David RobertsThat's Hennepin?Jamie LongYeah, the Hennepin Energy Recovery Center is what it's known as. So we excluded that as a gesture to the community and to the county that we understand this is a facility that we don't want to see be the long term solution to our waste problems in that particular location.David RobertsI'd like to pick up both of those a little bit. On the hydro, my understanding is that this was a subject of some contention, I mean, one is what if we just get more hydro and don't do any wind or solar, as you say, that's probably not as much of a concern. Now, although, I'm curious, you're accessing this Manitoba Hydro, could you theoretically just buy more of existing Manitoba Hydro? I'm curious, have you topped out how much you can get from there?Jamie LongYeah, it's pretty well topped out. It's all spoken for between Manitoba and Minnesota. So last year there were lower water levels in Manitoba and they wound up being able to ship a little less power to Minnesota because they had to use it all from Manitoba. So both with the existing transmission and the existing need, there's no real extra capacity.David RobertsBringing on any substantial new big hydro from Minnesota would mean building new dams.Jamie LongYeah, and it would take longer than the time allotted.David RobertsI know there are sort of concerns about the pipeline from those Manitoba, the electricity lines from those Manitoba dams down to Minnesota. How did that play out? Because my understanding is that environmental groups, the reason they didn't want big hydro counted is partially because they don't want more of that. How did that sort of controversy play out?Jamie LongYeah, there were some concerns from some indigenous environmental groups around large hydro. And so that was one of the reasons why we made clear it was only existing hydro. So we didn't allow for new hydro to count towards that renewable energy standard, so that we would foreclose the possibility that new construction would be eligible. So in the law, it says only as of the effective date of the act, those facilities would count.David RobertsI see. So even if they did build new dams.Jamie LongIt doesn't count towards renewable energy standard. It would count towards carbon-free because we don't have technology limitations there. It's anything that's carbon-free. But for the renewable energy standard, it wouldn't count.David RobertsGive us a sense of where non hydro renewable energy is in Minnesota. Are the big Minnesota utilities in shouting distance of that 55% target?Jamie LongThey are. So last year in Minnesota, we were at 52% carbon-free for the entirety of Minnesota's power generation. Now 24% of that was nuclear. So about a quarter of our power in the state's nuclear, but 28% was renewable energy. So that's pretty good. And then if you look at it based on, by utility, there is a bit of a differentiation. Minnesota Power, for example, which is the utility that services the northern part of the state, they're pretty unique because they serve some really large customers. Mines, timber. They were at 90% or so coal in the 1990s, and then as of even 2015, we're at about 75% coal. And now they're over 50% renewable.David RobertsOh, wow. So they've been moving pretty quick already.Jamie LongThey've been moving very quick already. And so we've had some good leadership from utilities in the state. Xcel Energy, our largest utility, was the first in the nation to say that they wanted to move towards 100% carbon-free electricity. And then both Minnesota Power and Great River Energy, which is our generation and transmission cooperative for most of our rural electric co-ops in the state, have also committed to carbon-free. Now, all three of those had 2050 as their target dates, so we're pushing them considerably faster than they had wanted to go, but they had set the direction that they were going to move towards carbon-free electricity, and all three of them, in the end, were supportive or neutral on the final bill. So I do give them credit for setting a direction and being willing to come along even as they were being pushed.David RobertsJust to clarify sort of the goals that they had set for themselves, that was all internally driven, that wasn't in response to any sort of mandates or government product.Jamie LongThose were public announcements. And so even before the law had passed, something like 80% of Minnesota customers were already being served by a utility that had themselves, on their own, committed to decarbonizing their electric service.David RobertsSo this is mostly accelerating what your big state utilities are in the midst of doing already.Jamie LongAccelerating and mandating, which is an important distinction. But they had made these targets on their own and they weren't binding. You know, Xcel Energy at different points in time had described it as an ambition or a goal or, you know, there was a lot of flexibility in terms of how they described it and now there is not.David RobertsNow there's locked in. Let's talk a little bit about garbage incineration because this sort of like only comes up in some states and not in others, and I've had questions about it over the years and I've never really bothered to poke around and learn a lot about it. But my understanding is two things: one is that the main reason municipalities are doing this is not for energy. It's that they don't know what else to do with their trash. They don't have anything else to do with their trash. And my understanding is that environmental groups are largely opposed to it and would have preferred to exclude it from the zero carbon energy standard entirely.So tell us a little bit about, just sort of like, what are the dynamics or how did that play out?Jamie LongSo it's this interesting interplay between waste policy and energy policy, right?David RobertsRight.Jamie LongSo I think most folks agree that landfilling isn't a good outcome for our waste management system. And there's disagreement though, on how much we can do in recycling and composting, and other forms of waste diversion. Environmentalists like me tend to think that we can do a lot more than we're doing. Pushing hard at the state level to do more in the recycling and organics management side. But a lot of counties in our state have moved forward with waste burning as what they view as better than landfilling. So not the outcome that they want, but better than landfilling.You still do have to landfill though. You're landfilling all the ash that's coming out, and the ash is toxic, and you're producing localized air pollution when you're burning it. So it's certainly not an environmentally friendly solution, but nor are landfills. And so there aren't easy choices here. But when it comes to the energy space, when we're thinking about moving towards a decarbonized electric sector, when you're burning trash, it produces carbon. So right now the waste energy, at least for our 100% target, doesn't count as a fully decarbonized source. We have a few pathways that counties could pursue which I can get into if you're interested in terms of how they could continue to operate.But they are, under our bill, either going to have to change or pay a little bit more money in a renewable energy credit to be able to continue to operate. And so it will make waste to energy harder, as a long term solution.David RobertsI don't want to get too deep into incineration here, but when you say improvements that they could make, does that mean there are safer and better ways to incinerate trash, or do you mean alternatives?Jamie LongWell, so under the bill, if you are not at 100% carbon-free electricity, one option you have is to purchase renewable energy credits.David RobertsRight.Jamie LongAnd this is a pretty common way to account for that sort of last couple of percent in different standards, and it was also in our previous renewable energy standards that we've had.David RobertsYeah, I want to get into that later.Jamie LongYeah, so that would be one option that they could pursue. They could shut down the facilities, they could not sell the power to a utility. Because we're regulating the sales to utility customers in the bill. So there are a few options, but I do hope that this will prompt some conversation in our counties about how they want to manage waste 16 years from now. I feel like there's a lot of time to figure out better alternatives than burning.David RobertsIt's not super clear to me what the ideal state of the art is here. But yeah, like you say, there's time to figure that out. What about within the bill? Is there anything specifically for distributed solar or distributed energy? That's one of the things I heard back from some sort of state advocates is that the big utilities are fine going renewable, but they're more resistant to losing control over assets and having customer owned assets. So I wonder, is there anything, is that mentioned in the bill at all?Jamie LongNo, we don't have a specific carve out for distributed energy. We wanted to keep our technology neutral approach intact. As you might imagine, there were lots of different requests for specific technologies.David RobertsInteresting.Jamie LongMost of those didn't go in the direction that I would call climate friendly. So we tried to keep the overall integrity of allowing for utilities to have some flexibility in how they are getting to 100% carbon-free in the bill. Now, that said, I do believe that there's going to be an awful lot more distributed energy built because of this bill. The utilities are going to need to find as much solar and wind as they can, and it's not all going to be able to be utility scale.So I think a lot of it will be distribution grid, interconnected. But I think that a lot of that conversation is probably going to take place in other contexts later this session. So we are one month in to our legislative session, and we've been talking for a long time about our community solar program. We have the largest, I guess now second largest New York just passed us, but for a long time we have the largest community solar program in the nation. There's a lot of conversation on what to do in the distributed energy space with interconnection. I think that's going to be a hot topic in session and there's going to be a lot of interest on policy fixes in that space.But for the purposes of the 100% clean energy bill, we felt it was important to keep flexibility for utilities and how to meet their targets.David RobertsInteresting. One other question about sources. I know anytime I mention energy policy on the internet, which is frequently, I get the question, well, what about nuclear? Is it nuclear just better? Why don't we just do nuclear, blah, blah, blah. You knew this was coming. So in Minnesota, you've got three nuclear plants, yes? Who are providing 25% of your power and a good chunk of existing low or no carbon, carbon-free energy. And that counts toward the standard, that energy counts toward the, the carbon-free standard for 2040. But there is also alongside that, a prohibition on new nuclear in Minnesota.And I know there was some argument on some quarters that the prohibition should be lifted, that small modular nukes should be allowed under this technology neutral standard. The bill didn't get into that. What's the status there?Jamie LongYeah, so nuclear politics is obviously complicated, not just in Minnesota. But you're right, we have three nuclear plants in the state and we have a moratorium on new nuclear plant construction.David RobertsAnd that was a bill that was legislative from previous.Jamie LongThe 90s. It dates way back. It's not a recent choice. And the reason is that we have the closest community living near a nuclear plant anywhere in the United States, and that's the Prairie Island Indian Community, which lives like a stone throw from the Prairie Island Nuclear Plant. And so it's in their backyard, right behind their houses. And so the Prairie Indian Community has had long standing concerns about the onsite nuclear waste storage, because we don't have any long term storage solution yet for nuclear waste. And so that waste happens to be stored right on site at the Prairie Island Nuclear Plant.And so when they were seeking permitting to store that waste on site, the compromise that was passed included a moratorium on new nuclear construction. So that's the history. The tribe remains concerned to this day about living that close to a nuclear energy plant in their community. So removing the nuclear moratorium is fraught. And there's also, I didn't have a single large utility come to me and say, "Hey, I'm ready to build a small nuclear modular reactor and I want this repealed so I can get this going".David RobertsYes, this discussion is extremely theoretical at all levels.Jamie LongYeah, exactly. That may be a topic of conversation that comes to the state in the future, but it didn't need to be solved in this bill because there is no real live proposal before us. All three of the nuclear reactors in the state are going through relicensing applications with the NRC. They're all at the end of their licenses or nearing them. And so that's the kind of active conversation.David RobertsYeah, are you talking about several states have taken action recently to extend the life of existing nuclear plants, is that on the table or in the discussion somewhere?Jamie LongNo, we don't really need to subsidize our nuclear plants in the state. They've been operating within competitive rates and we're regulated state, we're not deregulated. I think some of the states that have had to support their nuclear plants because they're deregulated.David RobertsRight.Jamie LongBut I think there is broad support for relicensing for those three facilities. The tribe that I mentioned is in active negotiations with the utility about waste storage next to them in a relicensing application. So there may be discussions there, but I think that there is general support for extending the life of those three plants and nothing more. We really need to do with the legislature on that. But in terms of new small modular nuclear reactors, there's no real active proposals or need to solve those problems this month.David RobertsLet's talk a little bit about utilities and their sort of disposition towards all this. Let's start a little bit, I think with munis and co-ops, municipal and cooperative utilities. I think, probably, most folks listeners live in cities and are served by big utilities and so might not be familiar with what these things are and why they tend to be resistant to the net zero push. This is not just in your state but in many states. So maybe you could just explain sort of like, what are these little utilities and why across the country do they tend to be centers of resistance to the push to clean power?Jamie LongGreat question. So municipal utilities are pretty straightforward. It's a utility that's run by municipality or at the municipal level to supply power. And they tend to be more of a distribution utility. They're often purchasing their power from somebody else.David RobertsThey're just not big enough to own assets on their own.Jamie LongMost of them don't. Yeah, there are a couple of municipal utilities in the state that do own some of their own generation, but most of the time they're purchasing the power that they sell. And then cooperative utilities are managed by local boards that are elected and they tend to be in rural communities. That's the history. It was part of the ability to get electrification to rural America, right? And the big utilities serve the cities and there needed to be a model that helped serve rural communities and so cooperatives was a model that took off. But in Minnesota it's 40% of customers or cooperative utilities or municipal utilities.So it's a big chunk. And if we're only focusing on our three investor owned utilities in the state, we're leaving out a lot of folks who have power delivery. So the cooperative utilities are very diverse in terms of their customer size, their location in the state. So we have some that now, once were rural, but now serve kind of a suburban membership, and then we have some that serve very small rural memberships. A lot of them tend to purchase power from these generation and transmission cooperatives. And so there's a handful of those that make the bulk of the decisions that then trickle down to the co-op.So I mentioned Great River Energy, in our state is the largest, and so it's complex. And in terms of why they resist, well, there's a couple of reasons. One is that they have tended to not have necessarily the same pressures to move as quickly as some of the investor owned, I think Xcel Energy, Minnesota Power, those are publicly traded companies. They've got a lot of folks who are looking at their future and what might be their risks. And for Xcel, I think part of the reason they went first on saying they wanted to be the first utility to get to 100% was to get noticed, right, to make a mark on the national stage that they were a leading utility.The boards of a lot of these local co-ops don't tend to be electricity experts. They're community members, right? They're folks who live in their communities and care about.David RobertsAnd we should say, I'll say it if you won't, rural and therefore likely quite conservative.Jamie LongYes, that's right. And so their understanding of the most up to date energy policy is sometimes a little dated. So I've met often with rural cooperative boards in our state and I even have brought graphs of the cost of solar and wind over time and showed them,"Look, it's cheaper! It's cheaper". And the feedback I'll sometimes get is, "Well, it's not reliable", right? There's always kind of something else. So there has been traditionally a lot of resistance at that level. But I'll give credit to some of the large G&Ts that work with the co-ops. They've understood that moving towards renewable energy is going to save their members money.So Great River Energy had a very large coal plant that it sold, that wasn't located in North Dakota, and it lost $170 million at that coal plant in 2019. They tried to sell that coal plant for a dollar and couldn't find anybody who would take it. So they wound up having to sell it with a very valuable high voltage transmission line, which probably down the road is going to carry mostly wind power from North Dakota to Minnesota. And by selling it, they projected that they would cut rates for their member co-ops by over 10%.David RobertsWow.Jamie LongSo, the economics are really driving a lot of the transition now for some of these rural co-ops, too. But they tend to be resistant to mandates and requirements.David RobertsSo, I was going to ask how you brought them around, but it occurs to me that maybe you just didn't and didn't have to. Did they come around?Jamie LongSo, the municipal utilities did not. They were the last holdouts. Every other utility association or utility in the state wound up being neutral or supportive. But the municipal utilities.Interesting.Were not, and in part they have local politicians who are involved in those discussions, and those tend to be from rural communities, and so you can connect the dots. For the rural cooperatives, to their credit, they came to the table. They have a very diverse membership, as I said, and there were a lot of pressure on that group. But they had one reasonable ask, which was, a lot of our co-ops are starting behind where these large utilities are. They don't have nuclear power, they don't have access necessarily to the same level of hydro as say, Minnesota Power in the north. So, they're behind. And so they asked for a longer on ramp to get to the same place. And so that seemed reasonable to me. So, we have the same standard for them in 2035 and 2040. They've got to get to 90% 2035 and 100% 2040. But for 2030, which, you know, in utility terms is very fast for planning purposes, we said, "Okay, we're going to give you 60% target for cooperative and municipal utilities in 2030". So that they had a little bit more lead time to do planning and to get on board.And that got them to neutral. So that was a big deal that they were willing to make that agreement.David RobertsA couple of other, you know, sort of what are being framed as concessions to utilities because, you know, utilities, of course, if you mandate something, they immediately come back and say, well, you know, they spin this scenario where 2040 is looming, and we don't have enough, and we're spending kajillions of dollars, and we're having blackouts.Jamie LongRight.David RobertsSo you have to formalize some sort of, well, you have in the bill an "off-ramp", quote unquote "off-ramp", which just amounts to, as I understand it, if the dates are approaching and the utility doesn't think they can meet the target without compromising reliability, it can go to the PUC and say, "Hey, we can't do this without compromising reliability". And the PUC will say, "Okay, here's a little extra time". Is that the long and short of it?Jamie LongPretty much, so a little more to it. But this has been in our renewable energy standard laws since the beginning, because there was always sort of a concern that when you got close you might not be able to get to meet it, and then you don't want the lights to go off. Right, is the argument.David RobertsI always just think it's funny, like find me a state, find me a PUC in the country that's going to be like.Jamie LongExactly.David RobertsYou can't meet the target without compromising utility reliability. Sorry, we're locked in by the law, we're all just going to have to have blackouts.Jamie LongYeah, too bad. the Republicans in the legislature called this the "Blackout Bill". And my last name is Long, so they called it the "Long Blackout Bill", which I thought was good. It was like maybe if my last name had been Short, then it wouldn't have been as scary. We can deal with a "Short Blackout", but that was "Long Blackout". So the 2007 standard, 25% by 2025, no one ever used the "off-ramp", right? No one needed to. They met at eight years.David RobertsI don't know of a utility in a state, anywhere in the country that has had to use one of these "off-ramps". Like they always meet the targets. It's always easier than they think. It's like can we learn from but.Jamie LongI think it is important to have this in the bill because I don't want to assume that we're going to come back and change this bill a bunch of times between now and 2040. If passed us any lesson, we haven't done this since 2007, it might be another 20 years until we get back to this. Who knows? And so right now I'm pretty confident that we can get to 100% clean energy by 2040. But maybe I'm wrong. Maybe we can only get to 98% and then do we really want to force that last 2%? So it does feel like it is worth having that mechanism in here.But what we did do is we made sure that there were real factors that the Public Utilities Commission would have to weigh. So yes, they have to relay weigh reliability and affordability, but they also have to weigh impact on environmental justice communities. They also have to weigh the social cost of carbon. And so what is this going to mean for the overall impact on our society? So you're right. At the end of the day, if it's going to affect reliability, and importantly now the utilities will have to establish that on the record in a public hearing through the Public Utilities Commission.So it's not just the utilities saying, "Hey, sorry, I know I'd said 100% by 2050, but Tesla couldn't do it". No, now they will have to actually put together a record and demonstrate to the Public Utilities Commission, "Hey, here is why I can't do this thing".David RobertsWe tried.Jamie LongYeah, exactly.David RobertsSo it's not an easy thing. It's not something they could just screw around for 20 years and then invoke this.Jamie LongNo, and they have to do it before the public. So does the utility want to go and say, "Hey, I'm going to have to be burning more dirty energy"? I mean, they're not going to want to do that unless they feel like they really have to. So I do think it's important to have that tool in there but, I would not be surprised if it's used very infrequently, if ever.David RobertsYeah. So the "off-ramp" did not bug me at all, but something else that's in there has kind of bugged me, and I read a bunch of articles about this and I just didn't see anybody else pick it out or examine it at all. But it also, in the bill says that utilities can buy RECs for compliance, renewable energy certificates, which basically just means someone else somewhere else generated more renewable energy than they need for their compliance and they're selling the leftovers, and you can buy the leftovers counted towards your total for compliance. To me, that's more of a red flag than the "off-ramp" thing because, as anyone who's been listening to Volts for a long time knows, these RECs are fairly cheap.Like if you just want to buy bulk solar and wind, like wind power from the Midwest RECs, they're pretty cheap. And in many, many cases they're going to be cheaper than actually reforming your own operations or acquiring new assets of your own. So why shouldn't I be worrying about that more? It seems like if there's something I'm going to worry about utilities doing, it's not just putting things off, it's just buying a bunch of cheap RECs to cover their obligations. So how do you think about that?Jamie LongYeah, well so this has been the framework that we've had in state law since the beginning of our renewable energy standard. So it's a tool that's been around and widely accepted. The renewable energy credits vary in cost and it's, you know, hard to know exactly what a 2039 renewable energy credit will cost. But they are real. So, you know, there's sometimes there is a concern around offsets in general, and I think a lot of that is valid, but renewable energy credits are a wind or solar or other renewable energy system where there's retiring their credit for a specific use.So it is additional renewable capacity that is being built on the grid and, at least for Minnesota, for the RECs that have been used to meet some of the earlier renewable energy standards, 60% of those are in Minnesota, and all of them are in the Midwest.David RobertsIs that by requirement or is that.Jamie LongNo, that's not by requirement but that's been the way, the way it's happened and I think the Public Utilities Commission has worked with trying to make the RECs as local as possible. So they so far have been all in the Midwest, and 60% have been in Minnesota. So that is additional renewable energy that's getting built in the state, and those credits can't be retired for anybody else. So if the utilities building their own renewable energy they're going to retire the RECs for themselves. So it is real. In some ways it acts as a carbon tax on the margins.When you're getting towards that last little bit of power that you need to meet your targets, then you're going to have to pay a fee. But we know that renewable energy is cheaper right now than fossil fuels and this is only going to put even more of a finger on the scale towards renewable energy. And if you're an investor owned utility you're going to have to go in front of the Public Utilities Commission and demonstrate why it is cheaper for your ratepayers to have a fossil fuel plant where you're paying RECs on it than wind and solar. And I just don't think that is likely to happen.David RobertsSo you are not worried about RECs forming any substantial chunk of compliance?Jamie LongNo, I'm not. I think that the most likely use for that will be when you have a last one or 2% and you have some sort of, I don't know, hydrogen peaker that uses some hydrogen that made from fossil fuels or something like that, that it'll take over that last couple of percent. Or something like waste energy, that I was describing before, where there's some other public policy good that you're dealing with. We have a big emerald ash borer problem in the state right now, and are cutting down a bunch of our ash trees, and we have a couple of facilities that are burning that and making energy out of it so. That produces carbon and there might be a need to have a REC for something like that.David RobertsAnd I also just sort of idly wonder when we're getting up to 2030, 2035 if compliance won't be, if more and more utilities are under compliance standards whether there are still going to be so many.Jamie LongWell that's right.David RobertsExcess RECs to sell, right? I wonder if that market is going to tighten up.Jamie LongMarket is going to tighten up. I mean these are going to be needed for a lot of different reasons. Corporate purchasers want RECs, utilities want RECs. We're seeing these standards become more common. So, I don't know that we can count on cheap RECs forever. And there does need to be I think some mechanism to account for these hard to deal with marginal sources. And we could say that you can't burn trash and you can't burn wood, but I probably couldn't have passed that bill.David RobertsRight. A couple of things about the bill itself. I'm sure you're aware one of the bigs from ongoing conversations in the clean energy world these days is about permitting and sighting and the difficulty thereof, that being kind of a bottleneck. Sort of like, even if you have willing capital and willing utilities and willing everything else, you have this process of permitting and sighting that is sclerotic and slowing things down. Did you take that on at all in the bill?Jamie LongWe did, yeah. We know that transmission is going to be a big challenge. It's a big challenge right now. We have a very constrained grid in Minnesota and a lot of renewable energy projects aren't getting built that otherwise could because the transmission costs are too high. And our regional ISO, the Midcontinent ISO in Minnesota, has announced recently a $10 billion new transmission investment in Minnesota and the region, that's the largest in US History.David RobertsOh yes, we did a pod on that last year.Jamie LongYeah, I listened to it. It was great. So frankly, myself and the former Republican Energy Committee chair and the Senate pushed really hard on MISO to move as quickly as they could on this because there were so many constraints. So we've been working at that level, but we also are trying to help at the state level. And we have several provisions in the bill that are designed to help with siting. One would remove a specific certificate that independent power purchasers are currently required to do, that was designed for utilities with ratepayer customers, and so it wasn't really the right fit.Another would, for very short tie lines for solar projects, that right now have to get county approval, would move that to the Public Utilities Commission. A lot of the counties don't want to deal with that anyway. So we were trying to do some of these easy streamlining things and they all wound up being really non controversial. But to help just make it a little easier to get some of this renewable energy deployed.David RobertsAnd do you feel like there's more to do there? Like, is that something that's going to come up again in the legislative session, do you think?Jamie LongWell, there may be. We had four specific fixes in the bill, and these had been around for a few years, we've been working on them for a while. There may be other changes that are needed to help out. The big thing we need to do is just figure out how we can get some of these projects built in our state that MISO has approved and we need to keep those on track. Minnesota Power has proposed a really innovative transmission line in northern Minnesota that's going to connect to some new wind power in North Dakota. And so that will be an important project too.I think they're getting some federal support for that transmission line, it was recently announced. So we have to build some of these projects out and I think there's going to be some state support to do that. For example, we're going to try to pass a pretty hefty package of state matching dollars to help out with the Federal Inflation Reduction Act, available money for transmission, and we're hoping that that will help deploy some of these projects.David RobertsI'm curious both about the prevailing wage provisions, and sort of beyond that, the general disposition of labor toward all this, like the role they played in all this.Jamie LongI think that was one of the best parts of the coalition work we did was having the broad support of our building trades and labor partners. It's not always been an easy conversation with building trades and clean energy transition, but I think seeing where the economics have pushed some of the coal plants in our state, and also recognizing that we have really good opportunities to build clean energy. A lot of the building trades in Minnesota have been really good partners in trying to help make sure that we are moving towards clean energy and that we are doing so with good union jobs. So because Minnesota was kind of an early mover in clean energy, even though we haven't been that active in recent years, we did get an early mover advantage in our, kind of the 90s into the 2000's, and we have two of the largest wind and solar installers in the country, based in Minnesota. And combined, they tell me that they've installed over 50% of all wind turbines in the US In the last decade. So we have a lot of opportunity that Minnesota workers have seen over the years to build renewable energy projects.David RobertsAnd an existing workforce that's presumably helping you, lobbying with you for all this.Jamie LongThat's right, that knows that these are good jobs. So we put a prevailing wage requirement for all new large energy projects in the bill, which is a big deal. And then we also included local worker considerations for the Public Utilities Commission, so that they could weigh when they were approving projects if they were in fact helping employ local workers. We also put in there preference for projects that are going to be in energy transition communities where coal plants, for example, will be retiring. So that we're trying to help backfill some of the tax base in those particular communities.So we worked hard with our labor partners and I don't know if there have been other states where the entire building trades, the statewide coalition supported 100% clean energy standard, but in Minnesota they did. And we had the bill signing at the Labor Center in St. Paul to mark what a strong partnership this was.David RobertsWell, it seems to me like nothing but a good thing that this element of the legislation, the sort of prevailing wages, local workers, all this kind of stuff seems to be a standard part of these state bills now. Washington, my home state of Washington, did some great stuff on this, but it seems like now it's just sort of like a standard piece of the puzzle, which strikes me as all to the good.Jamie LongI think that's right. And I think President Biden deserves a lot of credit on that too, to having made this labor climate partnership a real cornerstone of his clean energy agenda.David RobertsSo, before we wrap up with just a couple of political questions. You've said a couple of times that Minnesota is the purplest, let's say, state to pass one of these things.Jamie LongYes.David RobertsWhich is true, but, you squint close up, and it's party line vote in both chambers. So, I mean, this almost feels silly to ask, but was there anything helpful or supportive from anyone on the Republican side throughout this process or did you just come into this thinking, "We're Democrats, we got to figure it out among ourselves, there's no hope"? Was that as predictable as I would have expected?Jamie LongWell, unfortunately it was. It was fully party line in both the House and Senate. We have had some bipartisan clean energy wins in recent years. We were one of the only split legislators in the country in the last four years, and when I chaired the Energy Committee, we had some good wins on energy efficiency and solar deployment. But for the big changes that we really need, we really weren't able to find the partnership that we wanted across the aisle. I don't think that that's true with Minnesota public, though. When you look at the public polling, and we have some public polling on our bill, it's broadly supported by the Minnesota public.There are partisan differences, though, even in the polling. So it does show that unfortunately, we are at a place where climate clean energy policy is more polarized than I think is healthy. But I think that the good news is, we have broad buy-in now from our utilities, from our labor partners. And I think if we look back on this in ten years, you'll find that the public is going to be very supportive and the politics on this will change. I think that when the public sees the benefits that this will have for job creation, for overall cost of utility bills, and of course, for climate public health, I think that support will grow.But I don't want to undersell what we accomplished either, which is that with a one vote margin in the Senate.David RobertsYeah, I mean, let me just ask about that directly, because the Inflation Reduction Act was a friggin miracle.Jamie LongRight.David RobertsBecause it all came down to the whims of one vain, relatively illinformed person and just sort of woke up on the right side of the bed. We sort of touched on some of the elements of this story, like, you brought the utilities around, at least to be neutral, not against it. Labor was for it. I mean, there weren't a lot of big organized commercial interests, seems like, against it. It's just Republicans against it. So how did you manage to keep every single senator on line?Is there some magic dust?Jamie LongSo Senator Frentz, who was a lead author in the Senate, and I worked really closely together throughout the entire process. And he's a rural moderate Democrat, I'm an urban progressive Democrat. So we were a good partnership. But when the Senate flipped to Democratic control, I was taking a look at some of the new members and hoping that we would be able to pass a bill as strong as the one we passed. And there was a member who won, who was the majority maker, who won in the Trump district, bright red district in the far northwest part of the state, around Morehead.And then I started reading up on his background and turns out he's a meteorologist who has been talking about climate change on the air for 20 years in his community, and the impact that this has on agriculture. He spoke on the floor on the Senate talking about how if we don't act now, the agricultural impact in our state is going to be enormous.David RobertsIt's kind of a lucky stroke.Jamie LongThat was a pretty good draw. We had a member who was in a challenging part of the state in the Iron Range, as we call it, in northeastern Minnesota, but we had all of his utilities that were neutral or supportive and we had the strong support of labor. And so for him, I think it was a vote that he could take and take with confidence. So, you know, the coalition that we built really helped. But we, we didn't we didn't take this to conference committee. We, Senator Frentz and I negotiated together and got to a place where we had a bill that could pass and get the support of folks in Trump districts in greater Minnesota and Minneapolis, districts in the Metro, with one bill with no amendments through the House and Senate into the governor's desk.So that took some work, but I'm really proud that we were able to get it done.David RobertsThe ability to hash this out such that it didn't need to go through a long dragged out conference committee process is really a notable level of party discipline and purpose, which we don't always associate with the Democratic Party. So it's really great to see when it comes up, like, you guys did not faff about you just went straight at this thing and passed it.Jamie LongThat's right. We knew what we wanted to do and, yeah, we got it done in a month. So it was an intense month, but I think we knew our purpose and we were aligned in our goals. And I wasn't two months ago sure that we would be able to get a bill as strong as the one we got through done. But I think Senator Frentz deserves a lot of credit for the work he did with the senators. And frankly, our partners, the utilities, deserve credit for being willing to come along, right? They understood that this is the direction we're headed.They knew this bill was going to pass. And so the asks that they made were pretty reasonable on the scale of things. And now I think we have one of the five strongest clean energy standards in the country.David RobertsTwo very brief questions to wrap up. One is North Dakota says they're going to sue Minnesota over the idea being that, you not buying their dirty power is a matter of interstate commerce. And thus your bill, something, something, dormant commerce clause. The illegal analysis I've read indicates that this suit has no merit. There was a suit back in 2007 that the Republicans won, but apparently it was on different grounds, the law was very different, it's a whole different thing now. I don't know if there's anything to say about this other than, it's likely to fail, but do you have any additional thoughts on it?Jamie LongWell, it says a lot about energy politics in the state of North Dakota. I think it says more about that than our legal chances. But we're North Dakota's biggest customer for their biggest industry. So energy is a lot of what North Dakota does and, to date, they have tended to focus on fossil fuels. Now they are moving, there is a lot of wind energy development happening in the state and to Governor Burgum's credit, he has said that he wants to move to a carbon neutral economy by 2030, or carbon neutral energy system.David RobertsYeah, they got a bunch of CCS and hydrogen fantasies to work out.Jamie LongThat's right. Yeah. So that's where most of his hopes are pinned on. But in terms of the legal challenge, no, there's nothing really there. I mean, the overall framework which is that we are regulating what Minnesota utilities sell to Minnesota customers, has been in law for all of our renewable energy standards since the inception, and North Dakota has never challenged those. So they did win a lawsuit against us after the 2007 energy bill and that was around a restriction that we had on imports of out of state coal. So that is a harder one to hold up in court and it was struck down.But in terms of this particular provision, it's not the same. And, as I mentioned, it was in law then and they didn't sue it against it because they knew that they weren't going to be able to win. So it is unfortunate. We'll probably have to go to court with our neighbors, and that's not never fun, but we're going to win this one and the law will go into effect, and hopefully North Dakota can sell us a lot of wind power.David RobertsI really wonder what North Dakota thinks it is communicating to the rest of the nation with this behavior. Like, how do they think this looks? I know they're all conservative and so they're all in the bubble, they're all watching Fox, so maybe they don't know how this looks to the rest of the country, but like good grief, suing to stop the future. Anyway, so final question this is electricity. Done and done. Check, check. What about transportation? And what about heat? What about natural gas heat? Those are the two big prizes after electricity. Are you cooking up plans to go after one or both of those?Jamie LongYes, we are. So on transportation, Governor Walz has been a real leader on vehicle electrification. He was the first state in the Midwest to sign on to the clean car standards out of California that are permitted for other states to sign on under The Clean Air Act and took a lot of flak for that, but stood up to the naysayers. And that's been a good commitment from him. But now we have the opportunity to do good work at the legislature, too, on electric vehicles. So I suspect there's going to be a really big package there and a very big package on transit, which I know has been something that we have wanted to fund at a substantial level for many years and haven't had the political support to do that.David RobertsYeah, you have some really, sort of, in those terms, kind of progressive cities in Minnesota that could use some help, I think, becoming more walkable and transit oriented.Jamie LongWe sure do. And they very much want it, and haven't had the support to get there. So we got another light rail line we're building out right now, we want to build a fourth. We have a lot of bus rapid transit that's being built in the region that we want to help support, as well as new bike-ped infrastructure. My city of Minneapolis tends to rank in the top five cities in the country for bike infrastructure, but that doesn't come for free, and they want more. So we need more. So that's going to be a big area.And then in terms of buildings, absolutely. The governor has a proposal to move our new commercial construction to net zero by 2036, for our codes, which I think would be exciting. And so that would be updating our codes every three years to get to that point. So I'm hoping that we can pass that this year. And certainly that's just the first step, we do need to make sure we're looking at existing buildings, I had a building benchmark bill last year that we are hoping can move this year, too. So there's more to be done. And luckily we have a lot of session left since we were able to get this done in month one.David RobertsRight. How novel, just to get something done quickly, and then I imagine even elements of the public who are against it, just like, everyone prefers for this just to be done, right? Nobody enjoys these full year long dragged out, miserable. No one wants that again.Jamie LongNo, yeah, we avoided the Manchin "Will he? Won't he?" for a year.David RobertsOh, thank God.Jamie LongAnd just got her done, so that was, I think, exciting.David RobertsAwesome. Well, congratulations again.Jamie LongThank you.David RobertsRepresentative Jamie Long. Thank you so much for coming, and thanks for all your great work in Minnesota.Jamie LongThanks, David. Appreciate It.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. 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In this episode, utility watchdog David Pomerantz discusses all the ways that utilities use ratepayer money to lobby against the clean-energy transition — and what regulators and policy makers can do to stop it.(PDF transcript)(Active transcript)Text transcript:David RobertsThere are many features of US public life that I believe, perhaps naively, would be the subject of a great deal more anger were they better understood. One of those is the role utilities play in climate policy.A rapid transition to a low-carbon energy system is necessary to avoid the worst of climate change. Happily, that transition is going to be an enormous net benefit to US public health and the US economy. It's good for quality of life, economic growth, international competitiveness, national security, and the long-term inhabitability of the planet.But it’s not necessarily good for the companies that actually sell energy to customers — power and gas utilities. In fact, utilities are using every tool at their disposal to slow the energy transition, from lobbying to PR campaigns to donations to, as the last few years have demonstrated, outright bribery.And here's the even more galling bit: they are fighting against the clean-energy transition using your money. They use ratepayer money — from captive customers over whom they are granted a monopoly — to fund their lobbying. They have effectively conscripted their customers, who have no choice where to get their power and gas, into an involuntary small-donor army working against the public interest.It’s outrageous. In a new report called “Getting Politics Out of Utility Bills,” the Energy and Policy Institute — one of the best utility watchdogs out there — details some of this utility corruption and offers recommendations for how to prevent it. These are not futile recommendations to Congress, but actions that fall within the current powers of state regulators and the Federal Energy Regulatory Commission.I have been ranting about utilities for years, and one of my most reliable sources on the subject has always been the report’s author, Energy and Policy Institute Executive Director David Pomerantz, so I was eager to talk to him to air some shared grievances, hear some enraging tales of utility shenanigans, and discuss what can be done to rein them in. All righty, then. David Pomeranz. Welcome to Volts. Thank you so much for coming.David PomeranzThank you so much for having me.David RobertsI was thinking of you just earlier today as I saw a new story in the Washington Post about how the gas industry is under fire and it is now hiring Democratic politicians to shill for it. And I thought: "Golly, isn't that thematically on point?". So it seems like a perfect time to be covering this report. Before we get into specifics of who's done what and how to stop them from doing it, let's just start with power utilities are out there getting involved in politics. And let's just sort of discuss what is their net effect on politics. Like, what are they pushing for and against out there in the states and at the federal level?David PomeranzThat is a great question, and I think it will be important in context for your listeners who I am count myself as a loyal one, and I know many are thinking about climate change, and energy policy, and decarbonization, and the energy transition. And if they are concerned about those things then they should be concerned about utilities, political power and their political machines. So let's talk about what their political agenda is. And we're talking about both electric and gas utilities. Oftentimes the same companies, but sometimes, you know, there are utilities that sell gas only and electricity only. And they're all relevant to this conversation.So, since you mentioned, gas utilities pushing back against building electrification, and that has certainly been in the news quite a lot this month, so we can start there, because that's really simple. The gas utilities sector is, with almost no exceptions, united in its aggressive political effort to stave off building electrification. They basically see that as an existential threat to their existence. They have for some time.David RobertsAnd it is.David PomeranzYeah, we can be honest about that, I think.David RobertsYeah.David PomeranzWe'll talk about electric utilities, of course. You know, electric utilities have not only a role to play in decarbonized world and a transition from fossil fuels, but really like the very central role to play in it. And I wish they would, more of them would get religion on that. But gas utilities don't really. Their role is, they make money from putting methane gas in pipes and sending it to buildings and factories.David RobertsThese companies that are both, you can sort of see a root out of this for them. But an exclusively gas utility really is, you know, destined for the trash bin of history, and knows it and is fighting it tooth and nail. But some of the stuff electric utilities are fighting, I don't think is as straightforward or obvious. Why they seem hostile to both distributed renewables, sort of consumer side stuff, and hostile to interregional transmission of the big power. So they seem hostile on sort of both ends of that. Why are they out doing that and how significant is their opposition to this stuff in the grand scheme of things?David PomeranzYeah, it's significant. It depends a bit on the issue. So maybe let's start on one end of the spectrum, with the things that they are most opposed to with the lease nuance.David RobertsRight.David PomeranzAnd I would say that that is distributed resources, customer owned resources, like rooftop solar, and energy efficiency, which we maybe don't talk about as much as we should. But, for decades now, electric utilities have opposed those because it presents a threat to their business model, right? As you have kind of, like, in the high priest of helping people to understand this, electric utilities in our current model make money when they build stuff. If people are putting solar panels on their roof, or adopting technologies to use less electricity, either one of those kind of has the same effect on the electric utility. It means they don't have to build as much stuff. And so they make less money.David RobertsYes, you're using less utility power.David PomeranzRight. So they are opposed to that. And we'll talk about some of the most scandalous things that utilities, electric utilities, have used their political machines to do in the last few years, but a lot of it roots from this almost paranoid obsession with stopping the growth of rooftop solar in some places. So that's that. On the other end of the system in terms of, like, the bulk power system, it's a little bit less monolithic and a little bit more of a spectrum within the industry. So there are absolutely electric utilities who have figured out that they can make money by retiring coal plants and gas plants, and instead building wind farms and utility scale solar farms. So Xcel Energy kind of coined the term "steel for fuel" to represent that change. And it makes sense. Now, they're all kind of in a different place on that. Some have really embraced that transition. Some of the dinosaurs in the industry, like Southern Company, or Duke Energy, or Entergy, they're not there yet for a bunch of reasons that I think are largely cultural, frankly. They just have a lot of groupthink in their leadership and their C-suites, and they haven't figured out yet that that solution sort of helps their profits and also helps customers. It's really good for everyone. And so on that, there's some heterogeneity in the whole sector.But there are companies who, utility companies, who absolutely, in the very recent past, have used their political power to slow down that transition too. So probably the canon example of that, and I think we should talk more about this because it's really such an important case study, is FirstEnergy in Ohio.David RobertsYeah, we'll definitely get into that.David PomeranzSure.David RobertsAnd the transmission thing too. I think is maybe not intuitive for people just to understand that sort of, if your power generation and transmission is confined to your utility area, you're sort of stuck with the resources you have within that area. And insofar as you connect to other areas, and potentially get cheaper power, right? You lower the price of power generally. And utilities, especially the owners of those plants that are getting those sky high prices, don't want that either.David PomeranzYeah, this is really counterintuitive for people. And I think, unfortunately, this narrative has kind of taken over that the main obstacle to building the high voltage regional transmission lines that we desperately need to transition from fossil fuels to renewables, is like some farmers and ranchers and NIMBY, "not in my backyard" protesters.David RobertsYes. Or environmentalists wielding environmental review, et cetera, and protecting salamanders.David PomeranzRight. And I'm not dismissing those things as real. There are people, you know, there is a history of landowners not wanting transmission lines going on or near their property. But in my opinion, far less of a barrier and gets much more attention than it should compared to this really big structural barrier, which is these multibillion dollar companies that don't want to see transmission built, regional transmission. And that regional part is kind of the key when it comes to utilities. So, utilities are very happy to build local transmission. In fact, they're probably gold plating their local transmission assets because they can get it approved very quickly.David RobertsYeah, super easy to get it greenlit.David PomeranzSuper easy. And it's a money making machine for them. The regional transmission assets, first of all, as with anything, they'll fight the opportunity for anybody to own those assets but them. So they will fight against any kind of merchant development of transmission, which takes a big piece of the market out that could make things cheaper for everybody. And, yeah, they'll fight against transmission lines that weaken their assets. So a good example of how this stuff all interacts is, there was a proposed transmission line to bring clean hydropower from Quebec into New England, and it was fought by local activists.But also NextEra Energy paid $20 million to bankroll, very quietly, some of those protests, and to campaign against the transmission line because they own gas plants and a nuclear plant in the region, and so that imported hydro would have undercut the profitability of those assets. There's another case, that we documented on our website, about how Entergy, utility company that operates in Louisiana and in the south, they actually hired sort of an undercover operative, like a consultant that didn't disclose they were working for Entergy, to go to some of the meetings of MISO, the Mid Continent Independent System Operator, and basically kind of try to gunk up the works, and slow down development of transmission lines that would bring lower cost wind energy into Entergy's service territory. So they fight that too. They fight distributed resources, they fight competitive regional transmission.David RobertsAnd they fight the creation of new competitive electricity markets too.David PomeranzYes, for sure. So, we have competitive wholesale electricity markets in many parts of the country. The ones we have could use some reforms to make them work better for customers. Utilities certainly will fight those. But there are also places where we don't have any, and the biggest one is the southeast. And the utilities there, companies like Duke Energy, Dominion Energy, Southern Company, they are very aggressively using their political power, including paying groups with names like Power for Tomorrow, that pay former regulators to do some of this stuff, to argue against bringing an RTO to the southeast, which many legislators in some of those states have expressed an interest in, for both parties because they want to see cheaper electricity.Large customers want to see it, because many of them want to have better access to clean energy, and a regional transmission operator would help with that. And the utilities are fighting that too. So it's really kind of up and down the system. A lot of solutions to decarbonization. Building electrification when it comes to gas utilities, certainly rooftop solar and energy efficiency, and in some cases shuttering fossil fuel assets, regional transmission... All of those are things we need, and all of those are things that in various parts of the country, one of the biggest reasons we're not getting those things fast enough, is because utilities are blocking them.David RobertsThis is one of this genre of podcast I think of as the "you should be madder pod", and people really should be madder about this. So it's kind of wild. So, anything that sort of like, brings cheaper power, and decarbonization, and customer empowerment, like all these things that are good socially, and environmentally, and economically, and politically, name it. Everybody wants all these things, except for the companies that control electricity which are out fighting them, which is just really wild. You know, like any widget maker is gonna go politically lobby against a ban on widgets, you know what I mean?Companies have, in our collective wisdom, we have decided that corporations are people, and have the right of free speech, and have the right to defend their interests, and whatever the propriety of that, it's a real thing. But, cannot make the point enough that utilities are not just another company, they're not just another private enterprise. So, give us that context too as well. Why? It's like, it's bad enough that the companies that control electricity are out comprehensively opposing better, cleaner, cheaper electricity. But these are not just normal companies, like, these are monopolies.David PomeranzYeah, they're basically state granted monopolies and that is a really important distinction. That's kind of everything. So, if you don't like the political position of some company that you buy some consumer product from, if you don't like the political position of a fast food company, you can buy your hamburgers from some other fast food company.David RobertsSo you don't like the behavior of a certain Tesla executive.David PomeranzPrecisely. You can buy an EV from some other car company. It's getting easier than ever. But if you don't like the political positions of your utility, first of all, you have no recourse. You have to buy electricity. In some cases you have to buy gas, for the time being at least. First of all, it's interesting you mentioned how in our collective wisdom, or at least the collective wisdom of the Supreme Court, we've basically created kind of, like, an anything goes campaign finance environment. And that's meant to, if you believe it, if you give credence to the logic behind those court decisions, like Citizens United, it's meant to protect the free speech rights of corporations. I disagree entirely with the construct, but that's the construct.What about the free speech rights of utility customers? Right? Like, if my utility is taking my money and spending it to sue the EPA, so that they can poison my air and water with impunity, that's political speech, you know? And I'm basically being conscripted unwillingly into an army of small dollar donors by my utility to fund that political speech. So there's case law about this. I'm not an attorney, but my First Amendment rights are being violated basically by compelling my speech. So that's one whole set of problems.David RobertsLet's just emphasize this real quick, because I don't know that we ever stated it clearly. But it is important for people to know that it'snnot just that your utility is out lobbying against your interests. And it's not just that you are a captive customer of that company and cannot get away from it, even if you disagree with its positions. It is also the case that the money you are being forced to give the company is being used for that lobbying. So you're not just an irritated bystander, you're literally paying for the companies to do this through bills that you have no choice but to pay. Which just seems like as straightforwardly.I mean, it's a little wild to me that there hasn't been lawsuits about this. It's a little crazy that we allow utilities to do this in the first place. I don't know what the positive argument is for allowing utilities to conscript their customers into being dirty energy lobbyists. Are there not lawsuits?David PomeranzThere have been some challenges and we're starting to see more of them. I think, like a lot of issues, this one kind of only rears its head and becomes salient when a lot of people start to talk about it. Utility political influence and regulatory capture kind of thrives in the shadows, and that's sort of the default resting state almost, like, if people don't talk about it, it just kind of grows and grows like fungus in the dark.David RobertsWell, it's kind of true of electricity generally, it's true of your utilities generally. You don't have to pay attention to that stuff.David PomeranzInterestingly, and this is a parallel to something you just talked about with Sage Welch on your show about gas stoves, there was more attention to some of these issues, like in the early 80s when there was a lot of skepticism and sort of public outrage about utilities for a lot of reasons. Electricity was expensive, it's coming off the back of Three Mile Island, and for a brief period, electric utilities were sort of treated more skeptically in terms of their political operations. And so, that's happened at other times in our history too, actually right after the stock market crash and the great depression in the late 1920s and early 1930s, which utilities had a big role in.There, at that time, was a massive degree of concern about the political power of investor owned utilities. A lot of that manifested at the time in this very big struggle between a much larger question of how we would serve electricity in the country, would it be investor owned utilities or public power, which you had FDR sort of pushing for public power, so they're... Detour. But a long way of saying, there have been periods in our history where people do pay attention to utilities political power, and there is a lot of outrage over it, and there tends to be legal action and legislation proposed and sometimes passed and regulation. But outside of those moments, it all kind of thrives in a lack of attention.My hope is that we are entering one of those cycles now, for a bunch of reasons.David RobertsYou would think, right? Because decarbon it is, like, existential threat, blah, blah, blah. Decarbon by 2050, blah, blah, blah. Like, this is here now. And imperative.David PomeranzYeah, now is the time for it. And one other thing I would just say quickly about that is, even if your utility is doing some good things, even if your electric utility has gotten the memo that it needs to decarbonize, maybe it's still fighting rooftop solar on the side, but at least it's switching from, you know, it's retiring its coal plants rapidly and switching to renewables, which some are. This corruption and political spending that they do, particularly what they're doing with ratepayer money, and what they're doing, that often breaks the law, that's really bad when it happens by the sort of, quote unquote, "better utilities" also, right? Because you have a bunch of opponents that clean energy transition, like fossil fuel companies and hardcore conservatives, who don't believe in climate change, et cetera, say they don't, they are all looking for a reason, in very bad faith, to criticize the whole thing. So if you have a utility who is investing in a lot of wind, but they're doing it via political corruption, that also presents a huge backlash risk. So it's kind of bad in all its forms and, as you said, the worst part is that we're being made to fund it.David RobertsYeah, I know. I think you could just say, and I think maybe you'd probably agree with this, it's just, it's ludicrous on its face, that publicly granted monopolies, who are providing an essential service that people cannot go without, are allowed to politically lobby at all. It's so familiar. I think we don't think about it, but it's just ludicrous that it's allowed at all. It ought to just be unthinkable. These should be technocratic nerds who follow instructions.David PomeranzJust as one small example of this, to put a fine point on it, you have all these, like, sports stadiums and concert venues around the country that are named like FirstEnergy Stadium or the Dominion Performing Arts Center. And once you see this stuff, I mean, once you sort of see the elements of the utilities political machine, once you know to look for it, you see it everywhere. It's like they're sponsoring every nonprofit, they're naming every venue after themselves. And part of what I think is so funny about that is like, why does a monopoly actually need to advertise?David RobertsExactly.David PomeranzThey're not competing for sales.David RobertsExactly. They are not going to lose costumers, by definition.David PomeranzRight. What does name recognition do for them? You can't leave them.David RobertsExactly. Why do they need to have PR departments at all? Customer service departments, yes. PR? Why, it is crazy.David PomeranzIt absolutely is. And that's a great juxtaposition because most of them have pretty poor customer service and massive PR departments. And that's where it can be hard to quantify and measure the full breadth of their political machine, but that is something we try to do at the Energy and Policy Institute. And when you look at it, they are among the biggest spenders in their states on everything, right? They're always among the top campaign contributors. They're among the top lobbying spenders. Their trade associations are among the best funded and wealthiest in Washington, DC where they do all their lobbying.And it comes back to that ratepayer question, right? In a perfect world, I think everyone would agree intuitively with what you just said, David. Like, why should they be allowed to practice almost any kind of politics at all, right? They're given this incredible privilege of getting a guaranteed profit margin and a monopoly. They should be essentially beholden to the will of our democratically elected officials. Not trying to shape it. But at a minimum, at a bare minimum, what we should do is make sure we get into some controls, to make sure that they're not allowed to supercharge and turbocharge that political machine using their customers money, right?That they're not allowed to hack off a few dollars out of your monthly bill every month and use it to pay for their public relations consultants, et cetera. And that is a relatively simple problem to solve with reforms. So that's what we're trying to lay out, how that can be done, in this new report that we wrote.David RobertsBefore we get to those specific reforms, and kind of the specific channels of utility influence, and how they might or might not be blocked with reforms, let's just take a brief detour for some storytelling. Because I think when people hear the lobbying is technically legal, as absurd as it is for it to be legal, but people should not take from that the impression that utilities are lobbying within legal bounds here. The fact that they are allowed to do this, allowed to use customer money to do it, is practically an open invitation to corruption and how they have answered the invitation.So let's talk about a few of the kind of higher profile examples that have come up in recent years. Because I think people, again, unless you really hear it put out plainly, it really boggles the mind, it beggars the imagination. Like, what they're doing is worse than anyone thinks. So, let's start with Ohio. I wrote a whole long thing about this and it was, what a rabbit hole! Like, every twist and turn you go, it's just nastier and nastier. But tell us what went down in Ohio.David PomeranzFor sure. This is a great time to talk about it. So, last week a criminal trial started for the former speaker of the House of Ohio, guy named Larry Householder. He is being charged with accepting bribes and being part of a racketeering scheme. Here's what happened. So, there's a large electric utility company based in Ohio called FirstEnergy. FirstEnergy for years had been trying to collect bailouts for some nuclear plants, and also for some of its coal plants that were struggling to make any money. They had tried with the Trump administration, they had tried with previous Ohio state governments, but they kept coming up empty and they found their guy in Larry Householder.So, what Larry Householder is accused of, and what I should note, this is very important since they're technically allegations for Householder until he's proven guilty, if he is. But for FirstEnergy, that's not the case. They admitted to everything I'm about to say in what's called a deferred prosecution agreement with the federal government, to avoid going on trial. So they paid $230 million and admitted guilt to all the following. They routed $60 million through different dark money organizations. So technically, these are 501c4 nonprofit groups, that do not have to disclose their donors, and FirstEnergy did not have to disclose giving them money.So it's kind of untraceable money that was then passed to Larry Householder. He used some of that just for his own personal use, which is what is at the center of some of the bribery charges. So, he like, used it to pay down a home of his, and he used it to pay for his defense in a lawsuit. But most of the money went to his political machine. So in 2018, most of that money went to elect a slate of republicans in Republican primaries that year in Ohio, that had sort of pledged their loyalty to Householder. They were actually in all these text messages that have come out through the legal process.They're referred to as the "team Householder" candidates. And through the political power that Householder gained through the election of a lot of those folks, he was able to win kind of an internal Republican struggle to become the speaker of the House. And in exchange, his payback to FirstEnergy was to pass a law called House Bill 6, which passed, it was signed by Ohio governor Mike DeWine. It offered over a billion dollars in subsidies to FirstEnergy's coal plants and nuclear plants. Did some other things that don't get as much attention, but are pretty important. Kind of did this fake decoupling scheme where, some of your listeners probably know, but decoupling is a policy where if a utility adopts energy efficiency measures, so its customers use electricity, they can be made whole from that. This was like one reporter in Ohio, Kathiann Kowalski, described it as a spoonful of sugar without the medicine. So basically it was like, if Ohioans use electricity, absent the energy efficiency investments, FirstEnergy would still get all that money back. And that's ended up being what happened through the COVID pandemic.So it was billions of dollars in handouts and bailouts to FirstEnergy. That's not even all of it. They also have, and FirstEnergy has admitted to this, they also paid over the last ten years, over $20 million to a guy named Sam Randazzo. $4 million of that came a couple of years ago, just before he was appointed as FirstEnergy's top regulator on the Ohio, the Public Utilities Commission of Ohio. And they have basically conceded, FirstEnergy has conceded that that last $4 million payment at least, was to influence his behavior as their regulator. And he was a big driving force behind passing HB 6.David RobertsThat's not a small amount of money for a dude, for an individual dude. These are not small bribes.David PomeranzNo, they're lots of money. And in this case, we don't always know, as this money sort of works its way through the utility accounting machine, like, where it originally came from. In this case, we know, thanks to some audits and some good investigative reporting by folks in various states and some people on my team, that this was ratepayer money, at least some of it was, went into this bribery scheme. And amazingly, not even just from Ohio ratepayers. So, at this point, it seems certain that FirstEnergy also took money from ratepayers of its subsidiaries in Pennsylvania, and New Jersey, and West Virginia, and Maryland. And all of that money kind of got hoovered into this machine and ultimately came out the other side, went to these politicians in exchange for these laws.David RobertsAmazing. If there's one thing that could be more irritating than your ratepayer money being forced to lobby your state politicians, its having your ratepayer money be used..David PomeranzSome other state politician.David RobertsFor corruption in some other state. You don't even get the benefits of the corruption. I think a lot of listeners probably were aware of this, or followed this, or read my piece about it a few years ago, or a million other pieces. It was really just to sort of put a pin in it. This is not one of these things where lines were pushed or like, it's impropriety. This is very straightforward bribery and corruption. It's almost like charmingly old school in a way like this. Like, checks being handed over.David PomeranzSometimes there are gray areas and blurry lines, but not on this one. And another day that, David Anderson is one of my colleagues who's kind of led our investigative work on FirstEnergy. He said something the other day that it's wrong for utilities to spend their ratepayer money on lobbying and politics. They're not supposed to do that. They're supposed to spend shareholder money on that, which we can talk more about, but they're not supposed to spend anyone's money on bribes. Like, that's just straight up illegal. And that's what happened with FirstEnergy in Ohio.David RobertsYeah, there are a bunch of examples in your report, and we could go through this all day, but I don't want to waste too much time. But just one other one, which I thought was also telling, is in Florida, which also involved a lot of very sort of straightforward interventions in the political system to get friendly Republicans elected.David PomeranzSo in Florida case, we're talking about a utility called Florida Power and Light. Also in the news lately because their CEO is a guy named Eric Silagy, who just unexpectedly announced his early retirement.David RobertsIt's probably fine. Probably nothing going on there.David PomeranzYeah, nothing to do with anything I'm about to say. So, unlike FirstEnergy, Florida Power & Light disputes a lot of this. But it's been reported out, and it's pretty airtight, and they've kind of been dishonest throughout the process, so I take pretty much anything they say with it the biggest grain of salt you can find. What FPL is accused of having done is, they were paying some, again, their political consultants, and these consultants then routed money. Again, you see a common theme here to these dark money 501c4 groups that they basically created for these purposes.And then, what those groups did was bankroll unaffiliated independent candidates for state legislative elections, who were designed to siphon votes away from candidates disfavored by the utility. In every case happen to be Democrats, not surprisingly.David RobertsSpoiler candidates.David PomeranzSpoiler candidates. And in Florida, this has been referred to as the "ghost candidate" scandal because these people, it's not like, oh, we're going to fund a green party candidate because we think that'll take votes away from a Democrat. But it's like, a real person who really wants to hold the office and for better or worse, is running. These are people who didn't do any kind of campaigning.They were candidates only on paper. In at least one case, the main attribute of the candidate was that they had the same last name as the democrat, which is useful if you're trying to knife and go to them. And it's pretty clear why they were doing this. That CEO who's resigning that I just mentioned, Eric Silagi, he said in an email to two other FPL executives, writing about one of the targets of this "ghost candidate scandal", a guy named Jose Javier Rodriguez, a democratic senator in Florida. He said, "I want you to make his life a living hell" to two other FPL executives. And it worked. That senator went on to lose reelection by 34 votes. So, in these state races that can have really close margins, this utility money has an effect, and that's just kind of the tip of the iceberg. FPL also, the same network of consultants and dark money groups and shady characters, they paid to have private investigators follow a newspaper columnist that had been critical of the utility. They paid for a network of these kind of fake news sites designed to spread utility propaganda.David RobertsMy goodness.David PomeranzThey were trying to buy out a municipal utility in Jacksonville. And allegedly, these consultants paid by FBL created a nonprofit to advocate for marijuana legalization, and then offered one of the city councilors who was most opposed to this FPL buyout, they offered him, like, a very high paid job with the fake nonprofit they just created. So it's really like a whole massive political machine.David RobertsPretty f*****g devious though.David PomeranzIt's diabolical, man.David RobertsI guess if you're just getting millions of dollars to sit around in a room and think of fuckery.David PomeranzAnd that's literally what they do. I mean, in that sense, like other companies, this gets back to the monopoly business model issue. Like, other companies, their incentives as a business are to like, keep costs low, make better stuff, keep customers happy, grow revenues, whatever. All of the utilities profit is determined by the regulatory system, like by their public utility commissions, or appointed by governors and nominated by legislators, et cetera. So, their biggest incentive is to game all that. So that becomes the focus of the company. I mean, anything they can do. And, I think some leaders of some of these companies have maybe better ethical systems than others.But the incentive structure is for them to do anything possible, short of getting caught by law enforcement officials, to game the system in their favor. And so, we don't need to go through all the examples, it could be hours. But it's not just red states. It's not just Florida and Ohio. ComEd in Illinois, they got busted by the department of justice and paid a 200 million dollar fine for a patronage scheme with the speaker of that House. This has happened really all over the country, and I think people hear the first energy story in Ohio and think, "oh my God. Well that's got to be the bad apple". And I'm not sure that's true. I think they're the ones who were the most egregious and got caught the worst, but if it's a difference, it's maybe a difference of degree, but not of type. Most utilities are engaged in some version of this behavior.David RobertsJust to reiterate again, this behavior is not just lobbying. There's weird trade groups, there's dark money groups, there's weird public relations campaigns that are not traceable back to the utilities, there's advertising. It's really a full spectrum of fuckery going on. All of which seem sort of inevitable, based on the structural incentives. I'm sure these are a lot of scummy people involved, but if you set things up this way and make it legal for them to do this, of course they're going to do this. So one other question before we get to solutions is just insofar as these things get caught, are the punishments or the threat of punishment enough to deter future examples of this?Does anyone get strung up as an example or how far behind are lawmakers on this?David PomeranzVery far behind. Unfortunately. This is actually one of the main solution sets, is around deterrence and enforcement. But that's really a missing piece of the puzzle. And I'll give you an example of how broken this is in Ohio. Let's look at what's happened to FirstEnergy. Now, the biggest penalty they've probably actually had to pay is with investor sentiment, right? Like shareholders in the company are a little bit skittish and certainly their stock dropped after the scandal, after this CEO of Florida Power and Light just announced his unexpected retirement. Next area of the parent company, their stock dropped by about 8% that day.They may recover some of that or all of it, but they do have some price to pay on Wall Street because investors I think the sort of unspoken secret among utility investors is they see regulatory capture and utility political power as a good thing right up until the point they get caught. For them, it's like, yeah, of course we want you to control the political environment. We want you to have the Euphemism is like, good relationships with your regulators. But they don't I think they kind of are happy to hear encino evil in terms of how that happens, but they certainly don't like when it leads to, like, FBI raids and Department of justice investigations.So there is a price they have to pay there, but the bigger price ought to come from the political system, and that has not happened. So just taking a look at FirstEnergy a rational response to what they did in Ohio, which was essentially a full scale takeover, a full scale purchase, essentially, of the legislature that's supposed to be democratically elected. I think a rational proportional response to that would have been at least exploring the idea that First Energy should should lose its charter to operate, like should lose its monopoly, find another utility that can provide those services to Ohioans. Because I would argue First Energy has lost the right to be considered for that.That would, to me be a rational response.David RobertsIt's hard to think of what would justify that if not this.David PomeranzI agree.David RobertsWhat would be worse? I mean, totally.David PomeranzAnd no one with power has proposed that. I mean, people like me talk about it all the time, but no one in power to do it in Ohio has proposed that. Instead, what we've seen is really a complete abdication. First of all, they haven't even fully addressed the law that was passed via these corrupt means. So the nuclear subsidies were rolled back from HP 6, but not the coal subsidies. Those are still rolling. That law I didn't even mention it before, but that law also stripped the very meager sort of renewable incentives or renewable performance standards in Ohio.David RobertsI remember.That hasn't been returned. So they didn't even address kind of the law that was bought with it. But in terms of consequences, there's been almost nothing. The Public Utility Commission of Ohio, they say that they have some ongoing audits and investigations of FirstEnergy, those are on hold until the criminal investigations are over. We'll see what comes of that, if anything. Interestingly, they did have to pay this $230 million payment to the Department of Justice to avoid prosecution. But we should just put that in perspective. The company made $11 billion in revenue in 2021. $230 million is significant, but it's less than the ill gotten gains they got from HP 6. I mean, that was billions in subsidies.Way less.David PomeranzJust as one indicator of how broken our enforcement machine is on this stuff. Interestingly, before the HP 6 news exploded, like, before there were indictments and criminal charges, FERC, Federal Energy Regulatory Commission, they had just started an audit of FirstEnergy's Accounting practices. And not surprisingly, in that audit, FirstEnergy did not disclose to FERC the portions of the Excel spreadsheet that showed the bribe payments. They sort of left that out. So just a few weeks ago, actually, FERC announced that it was finding FirstEnergy for violating its duty of candor obligation with the commission, because when you're audited, you're supposed to provide all those documents.They didn't tell auditors about $90 million in lobbying expenses, 70 million of which were dark money payments involved in that bribery scheme. For that violation, they fined FirstEnergy $3.9 million.David RobertsOh my God.David PomeranzAnd they said, well, this is kind of a fair and equitable fine based on our practices, but that's $4 million.David RobertsHouseholder got more than that. Personally, bribes, never mind the rest of it.David PomeranzIt's a $4 million penalty for lying, about $90 million, much of it spent on a corruption scheme that netted billions for the company. So to call it a slap on the wrist is kind of an insult to slap on the wrist. And the way regulators treat this right now, it's interesting. Public Utility Commissions and FERC actually have a lot of statutory power to fine utilities. That is like a key component of what it means to be a utility regulator is that, if you want to, you can penalize them. FERC has authority to find violations that utilities commit in its jurisdiction up to a million dollars a day for every day that they're in violation.But they almost never use this authority. I mean, occasionally FERC will use it in cases of really, really egregious market manipulation. But on this stuff, I'm like lying or sort of quote unquote, "mistakenly charging customers for political expenses", that's almost never fined very, very rare cases, and the fines are very small. And when they do catch it, what they say is like, okay, well, you got to refund the money to Raypayers. But that's sort of like telling somebody who robbed a bank if a cop caught a bank robber mid act and said, "Oh, you know what? Just put the money back in the vault and we'll call it a day". That's basically the way regulators treat this kind of misbehavior. So there's almost no deterrent.David RobertsWhich is to say, even from the perspective of today, what FirstEnergy did was perfectly rational and business positive. And if I were a FirstEnergy investor, I'd be like, "Nice work, do it again". There's no reason not to do it again. They get so much more out of this than anyone penalizes them for, even if they are caught. So in terms of maximizing shareholder returns, it just seems like perfectly rational behavior on their part.David PomeranzAnd they're the ones who got caught, which is the minority, I think. Obviously, we don't know what we don't know.David RobertsRight.David PomeranzBut FirstEnergy, at least had to suffer some consequences. Like they've gone through two CEO, they fired the CEO who was responsible for much of this, and the next CEO didn't hold his job terribly long, they've had some board turnover.David RobertsI'm sure those guys are suffering, David. I'm sure they're on the soup line now, regretting their choices.David PomeranzThat's a great point. But to the extent they've had any consequences at all, it's only because they got caught and other utilities are not, or they're caught doing things that are deemed to be just on the right side of legal. So, as an example, Michigan Utilities, not caught in as much attention because there haven't been criminal charges, but they've spent tens of millions of dollars on dark money operations to control the political environment in their state and even in others. I mean, DTE Energy is a Detroit based energy company. They own some biomass plants in California as part of their unregulated part of their company.And they routed money through a dark money group, which ultimately ended at a national laboratory, which put out a report talking about how those biomass plants would be great candidates for carbon capture and sequestration, which is what DTE is trying to do. So none of that has been prosecuted. None of it's been caught. We've tried to expose some of it. Sammy Roth at the L.A. times wrote a great story about that scheme. And and I should say, by the way, just quickly, as an aside, there are reporters around the country who are working tirelessly to expose this kind of corruption.Too many for me to name individually, but they're really doing an incredible service to not just energy customers, but to democratic institutions that these utilities are undermining. But your central premise is, right, just a newspaper article or two. And even when there have been criminal prosecutions, the consequences are too low to deter utilities from doing this. And part of the reason we know that's true is because they keep doing it.David RobertsYeah, proofs in the pudding. So with our time remaining, then having griped about this, which is deeply gratifying to me, as you know, griping about this for many years now, let's talk about what can be done. Obviously, in a sane world, in a country with an operational federal apparatus, which you'd like to see is Congress to act, right? I mean, Congress could just write a law saying utilities can't do this anymore, period, full stop. And that would be nice. As we know, Congress doesn't work, et cetera, et cetera. Half of them are bought by utilities filibuster, on and on, usual.So we're left basically looking to either federal agencies, that Biden can control, or state governments. So what can those entities do that would have some actual bite and then some effect?David PomeranzYeah. A lot, thankfully. So that's what our new report is about. And usually the stuff that we do at EPI is just kind of like, try to expose and document all these problems. But we've been spending so long doing that, and it does seem like people care that we wanted to at least take a stab at saying, here's what we can do about it. And there's basically three things. One is having utility regulators. So this is mostly Public Utility Commissions simply pass rules and clarify the existing rules to close all these loopholes and just make clear that utilities cannot spend their ratepayer money on any kind of political influence activity and then define that activity really clearly.By the way, if you ask utilities right now, they would say, "Well, we don't spend any ratepayer money on politics. We certainly don't spend any ratepayer money on lobbying." But that's just sort of fun with words, like, the way they define lobbying as the narrowest possible definition. And even then they're not actually following those rules, which we can get to how you prevent that problem. But the first thing is to make those rules airtight. So define, Public Utility Commissions can define all of these different kinds of politics lobbying, PR machines, advertising, political advertising, regulatory lobbying, where you're going to regulators and asking for stuff, all of it, and say you cannot use customer money for that.If you want to do it, you can do it out of your own profits.David RobertsTwo things. One is, so any PUC can just do this now. PUC has the regulatory authority to just do this. Now, my only question is how easy is it to distinguish utility ratepayer funds from utility, I don't know, like investor...David PomeranzProfits? Yeah.David RobertsProfits. I'm sure there are all sorts of ways of muddling those.David PomeranzThere are. And that's what happened in the FirstEnergy case. I won't bore you all with it. But the answer, is it's hard to distinguish. And so that's what gets into the second leg of this tool.David RobertsI mean, why not just say don't do it at all with anybody's money?David PomeranzThat would be the perfect world. So that is something that a public utility commission couldn't do by itself, but a state legislature could. And we've seen some efforts at this. I think it's politically a bigger lift, but that doesn't mean it's not possible. There's nothing stopping a state legislature from trying to say "Utilities are different from other kinds of companies, and we think they shouldn't spend any money on politics". And clearly define what that means. Usually in the wake of big scandals, there have been some legislators, state legislators, who have proposed bills like that, like after utilities in South Carolina tried to spend billions of dollars on a nuclear plant and just built the world's most expensive piece of pipe art.There were some legislators who proposed bills like that. I would love to see more of it. I think those kinds of bills will run into challenges in the courts, given our current campaign finance rules, but they're worth trying. And I'm not a constitutional law scholar by any means but there is reason to believe that, I think there is legal justification to treat utilities different than other companies when it comes to campaign finance.David RobertsI mean it's an interesting legal question because utilities sit in this really weird ontological space like they're companies. They're kind of private companies, kind of not, kind of public, kind of not. Has it been hashed through the courts whether they have all the same rights of expression as truly private companies?David PomeranzI don't think it has. I'm going to get out over my skis pretty quickly talking about legal stuff. But one thing I will say, interestingly, just as a note, that maybe will pique folks interests, in the Citizens United case, the liberal justices in their minority opinion argued that the framers did not think corporations should have kind of unfettered speech, and they're different from human beings free speech rights. And of all people, Justice Scalia's rebuttal to that. He actually said well when the framers said that kind of stuff they were talking about state chartered monopoly corporations and that might be true for them, because, at the time, we had, that was common then, corporate structures were very different 300 years ago.So comments like that do sort of open the door of this tantalizing question like, should there be legal efforts to try to treat monopoly utilities as fundamentally different? Like you said they operate in this different space., they're not like other private free market companies. Should they be treated differently from a campaign finance perspective? And I think if there are constitutional lawyers who are listening to Volts I hope they will explore that question because it's ripe for that.David RobertsBut don't you just think like whatever the legal merits, our Supreme Court will end up getting it and doing whatever is corporate friendliest regardless of the legal merits? I mean, law feels so futile these days.David PomeranzYeah, well I'm certainly not optimistic.David RobertsBut PUCs are squarely within their rights to say "Don't use ratepayer money".David PomeranzYes, absolutely. So that's sort of why we start there, it's just because it requires no systemic changes, no constitutional challenges, it's really simple for PUCs to say "No ratepayer money on politics".David RobertsAnd that is because, by law, utilities are supposed to spend money in whatever the most just and reasonable.David PomeranzReasonable. Exactly.David RobertsAnd so this would be under that provision basically saying it is not fair and reasonable to spend money this way.David PomeranzThat's exactly right. And then the challenge becomes, as you said, okay well, we can say that but how can we tell which money is very fungible? How can we tell which pot of money this political activity is being funded by? And so that requires basic transparency and disclosure reforms. So, right now, if you want to know whether a utility spend ratepayer or shareholder money on a given activity, the process basically is to wait for the utility to go in for a rate increase, and then there's a sort of quasi judicial rate case. And if you have money and can hire a lawyer, you can intervene and get status to be an intervener in that rate case, and then you can ask discovery questions with the utility and try to find out how that activity was funded. Now, to be clear, like groups do this. Earthjustice, they do an incredible job of that around the country. Sierra Club does that. Consumer advocates in every state try to do that. They're trying to protect consumers from that, but they're totally outgunned. And some utility companies don't have rate cases for five years or longer. Alabama Power in Alabama, they haven't had a legally contested sort of open rate case with public intervention since 1982. So who knows what they're spending money on.So what we need is basically, the solution to this is having annual line item granular disclosures that utilities are made to file with the PUC in all of these areas. So anything that is vaguely political, or even adjacent to political, PUCs should be requiring them to basically submit a spreadsheet every year that says what they spent, where the money came from. And then you can kind of check. So that the first step is to make sure the rules are strong. The second step is to have these disclosures, so that you can verify that companies are following the rules.And the third step is enforcement. So this is what we talked about before, so I won't dwell on it. But if you make the rules strong, so the utilities know them and they can't say that they screwed up by accident, and then you have the disclosures, so that members of the public or regulators can catch if they screwed up, and they did screw up, or they did break the law and they charged ratepayers for some political activity, then there have to be consequences. Otherwise there's no deterrent. And those consequences should be severe. So we're arguing, like, if a utility takes a million dollars of ratepayer money and spends it on, you know, what political trade association or some kind of politics that they're not supposed to, they should have to return that money, and then be fined, like, at least that million dollars and probably a lot more to make the deterrent adequate. So those are kind of the three steps. We've got better rules, better disclosure, better enforcement.David RobertsRight? And is enforcement, at least what's available today that we know works, is that mostly just financial? Is that mostly just fines? Are there other potential consequences? Because for a company like FirstEnergy that's doing billions of dollars of business and lobbying on behalf of billion dollar nuclear plants, there's just unfathomably large amounts of money being deployed here. And I'm just trying to imagine the size of fine that would compete with those amounts of money for their interest in there. You know what I mean? Can fines even get big enough?David PomeranzIt's a really good point. Well, I think one answer is let's try some really big fines and see how they work.David RobertsLet's give it a world.David PomeranzLet's give it a college try. But I do agree with your premise there that some corruption, some kinds of behavior, are so bad enough that it is hard to imagine a dollar figure that could adequately deter, especially when they're all counting on not getting caught. And so, in that case, I do think this probably would be something that a legislature would need to do and would be difficult for a PUC to do unilaterally. But I do think in cases like FirstEnergy, public officials in Ohio ought to consider whether the company should be allowed to continue to operate in its current form there. So that can all be part of enforcement as well.David RobertsWhat about a legislature saying "This balance of public and private that we tried in investor owned utilities clearly isn't working, so we're just going to make you public, make you into a public utility". Has anyone tossed that out there? Is that even on the table?David PomeranzI think so. People are talking about that. I mean, there are movements of people where I live, for instance, in California, who's basically suggested it's a little bit different than these political issues, but they've basically said that PG&E's criminality with regard to starting these devastating fires has been so bad that the only solution really is to have them be converted into a public power entity. There have been similar efforts like that in different pockets of the country. There's one ongoing right now in Maine, and a lot of that I think is inspired by this problem. If you talk to advocates of public power, they will say that we just can't trust these investor owned utilities to not run these political machines that threaten the integrity of our state government. And I'm very sympathetic to those views. I'm not sure if that solution will work at scale everywhere. And it's also worth noting, like public power entities aren't perfect, they also require good governance and good accountability. All you have to do is look at TVA.David RobertsI was going to say, and they don't necessarily perform better. I always sort of caution people about that. Like, the issues that dictate good or bad performance don't necessarily line up with public and private. But it does seem like, at the very least, if it was a public utility, it would have less structural incentive to cheat and lie. Do you know what I mean?David PomeranzI think that's true. I agree with that. And so I think that option should be on the table in places where that makes sense. I'm all for people pushing for it. It's a much bigger lift, obviously.David RobertsYes, all of this is pretty tough.David PomeranzIt is. Although, just to back up to some of these changes that would be easier for a single public utility commission to do, or a single state legislature. The kind of stuff that we're outlining in this report, I don't think it would solve every single problem when it comes to utility political machines. But something is better than nothing. The status quo is pretty bad. So let's start trying things. And these are all doable within the current system. Some of them are being explored now. So just as some bright spots, some examples. The New York state legislature recently passed a law that banned utilities from charging ratepayers for any trade associations that lobby.I think that's progress. FERC has an open proceeding. So, inspired by a great legal challenge from the Center for Biological Diversity. So yes, who's doing lawsuits? Who's doing legal challenges on this stuff? Center for Biological Diversity has an energy justice program with great lawyers that are doing some of this. So they petitioned FERC to take a look at some of this, and FERC opened an inquiry, they got lots of comments. Everybody other than the utility said, "Yeah, we need some accounting changes and some new rules and some better transparency to prevent utilities from charging customers for trade associations, for politics, for their politically motivated charitable giving, for all that stuff".Interestingly, even people who I don't agree with about anything agree on this. Like oil companies actually as electricity customers, weighed into the FERC docket and said, we would prefer not to pay for their lobbying. Also that happened, and FERC can act at any time. So you mentioned through federal agencies, FERC is meant to be independent, for commissioners are appointed by the President, but they don't act in his direction. But FERC can do this anytime they want. They've had this notice of inquiry proceeding. It's been responded to by all parties. They could draft a rulemaking that makes it harder for utilities to supercharge your political machine on rates.And there are some individual public utility commissions who have disallowed some things, who have done some aggressive disclosures. So we point out those examples in the report. People should check them out just to show like this is possible. And our hope is that more PUCs and legislators start proposing these things and we'll see what comes of it.David RobertsIf you're just a listener out there and you didn't realize how bad this is and are now mad per the you should be mad or about this episode, they just listen to what can people do? Is there a particular organization that's working on this? Or is it just a matter of contacting your own state's PUC or writing your legislature? Is there a place to sort of centralize this work that people can go just support?David PomeranzGood question. Well, they can learn more about it at our website. So that's energyandpolicy.org. We focus pretty heavily on this stuff. In terms of groups that are taking action, I'd recommend a couple Center for Biological Diversity, as I mentioned, they are doing some great legal work on this. There's a group called Solar United Neighbors who works with rooftop solar advocates and customers, but they have operations in a lot of different states, and they have a national advocacy program, and they are invested in creating some of these kinds of changes. And then if you're not sure, like, those groups have ways in for you where you live.The Sierra Club is involved in Public Utility Commission proceedings in most states, and they're very much invested in attacking utility political power. So that's another organization that folks can check out.David RobertsYeah. And worth saying again, as I've said so many times over the years, PUC meetings are pretty sleepy. You're not going to be standing in a long line to get in one of those. So a little bit of noise goes a long way. Especially relative to a lot of other places you could make noise, like, they don't get a lot of noise there, so they care.David PomeranzI couldn't agree more. These parts of state government that are responsible for regulating utilities, they're not very well known. And for people who want to become active, they can do a lot as a single person. I'll give a shout out to one activist in Arizona, a woman named Stacey Champion, who pretty much working independently, she's a very skilled person, but she didn't have lots of backers or anything really helped to bring Arizona Public Service, a utility that was behaving very badly in that state, to heal over the last years just by getting lots and lots of attention and doing great organizing work and campaigning.So it is a place where people can make a difference and everything's harder alone. So they just kind of need to find some people who are willing to work with them on it.David RobertsAwesome. Okay, well, thank you so much for coming on and walking through this. It's like with so many things like you, listeners, probably vaguely know that it's bad, but it's way worse than they thought. So, David Pomeranz, thank you for coming and sharing this with us.David PomeranzThank you so much for having me.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

Will widespread electrification of the US personal-vehicle sector inevitably be accompanied by a huge rise in environmentally destructive lithium mining? Not necessarily, says a new report. In this episode, lead author Thea Riofrancos discusses options for reducing future lithium demand through density, infrastructure, and smart transportation choices.(PDF transcript)(Active transcript)Text transcript:David RobertsThe transportation sector is the leading carbon emitter in the US economy, and unlike some other sources, it is on the rise. Decarbonizing it is inevitably going to involve wholesale electrification of personal vehicles. We're going to need lots and lots of EVs. That’s going to mean more demand for minerals like lithium, which is mined in environmentally destructive ways and almost everywhere opposed by local and indigenous groups. But lithium can be mined in more or less harmful ways, depending on where and how it’s done and how well it’s governed. And the number of EVs needed in the future — and the consequent demand for lithium — is not fixed. The US transportation sector could decarbonize in more or less car-intensive ways. If US cities densified and built better public transportation and more walking and cycling infrastructure, fewer people would need cars and the cars could get by with smaller batteries. That would mean less demand for lithium, less mining, and less destruction.But how much less? That brings us to a new report: “Achieving Zero Emissions with More Mobility and Less Mining,” from the Climate and Community Project and UC Davis. It models the lithium intensity of several different pathways to decarbonization for the US personal-vehicle market to determine how much lithium demand could be reduced in different zero-carbon scenarios.It’s a novel line of research (hopefully a sign of more to come) and an important step toward deepening and complicating the discussion of US transportation decarbonization. I was thrilled to talk to its lead author, Thea Riofrancos, an Andrew Carnegie Fellow and associate professor of political science at Providence College, about the reality of lithium mining, the coming demand for more lithium, and the ways that demand can be reduced through smart transportation choices.Alright. Thea Riofrancos, welcome to Volts. Thank you so much for coming.Thea RiofrancosThanks for inviting me.David RobertsI've been meeting to get you on forever and waiting for the right occasion, and this is just a humdinger of an occasion here, this report. It's right at the nexus of, like, a lot of things I cover a lot, and a lot of things I feel like I should cover more, bringing them together. So before we jump into the details, I just want to take a step back and summarize the report, the framing of the report as I see it, because I've seen and heard some media coverage of the report, and I'm always just a little frustrated by how other journalists cover things.Thea RiofrancosUnderstandably.David RobertsIt's just this weird oblique... they don't take the time to sort of say, "what is the main thing?" Before getting on into weird little side questions. So I'll just say, as I understand it, the premise of the report here is we need to decarbonize transportation, yes. And electrifying vehicles is a huge and unavoidable part of that and extracting a lot of lithium is an unavoidable part of that. However, and here I will quote the report, "The volume of extraction is not a given. Neither is it a given where that extraction takes place, under what circumstances, the degree of the environmental and social impacts, or how mining is governed."So the idea here is: yes, we have to decarbonize, we have to electrify, we have to electrify transportation. We need electric vehicles, but there are better and worse ways of doing that, more and less just ways of doing that, more and less lithium-intensive ways of doing that, and we should do it the best way we can. Is that fair?Thea RiofrancosThat is fair. And you've also quoted one of actually my personal favorite lines of the report, because I agree with you that it really gets at the heart of what our goals are, the kind of questions that we're asking, and also this desire to align goals that might seem in tension with one another, right? Which is rapid decarbonization on the one hand, and on the other hand, protecting biodiversity, Indigenous' rights, respecting other land uses, and those can feel—and to an extent, materially are—in tension with one another in specific instances. But our goal was to say, "Is there a way to have it all from a climate justice perspective?"What's the win win? Or what's the way to get away from at least a sort of zero-sum framing?David RobertsRight. Or just a north star, a way to look, a goal to pursue rather than just sort of this binary notion of we're going to electrify transportation or not. There's just a ton of room within that to do it in different ways. So that's the main thing here. We're thinking about how to decarbonize transportation in the best possible way, where it's both rapid decarbonization and as just as possible and as light on the Earth as possible. So within that, you sort of take as your primary metric: lithium. You compare scenarios based on their lithium intensity. So maybe let's just start there and you can just explain to listeners why choose lithium as your sort of central metric?Thea RiofrancosGreat question. Because one could imagine this report being replicated across a whole host of transition minerals, and I actually hope that it is, right? I do see this as a kind of opening to a research agenda that we hope is malleable in other sectors as well. Why lithium? Maybe let's zoom out a little bit and just say how urgent it is to decarbonize the US Transportation sector, right? And so that's why transportation which we can talk about more later, of course.David RobertsYeah, I think in the latter half we're going to get into transportation and US Transportation all the stuff.Thea RiofrancosIt helps us sort of understand why the battery and the battery helps us understand why lithium. So I'll just treat it in that order briefly, which is transportation sector number one, and main steel sort of rising emissions sector in the US, right. In order to decarbonize that sector, there's lots of forms of transportation. We're focusing on ground transportation here. And the prevailing technology for decarbonizing ground transportation is the lithium ion battery. That may change in the future, and I'm happy to sort of entertain that. We can talk about it if we want. But right now, in terms of commercial viability, scale, and just the actual material production that's going on in the world, it's the lithium ion battery.When we sort of dig into those batteries, and I know you've covered batteries on prior shows, there's a whole set of different minerals and metals used in the cathodes, the anodes, the separators, et cetera. Lithium is central, though. Lithium is the kind of non-substitutable element in that recipe. You can go to different cathode chemistries that do or don't use nickel, that do or don't use cobalt, et cetera, right. The iron phosphate versus the NMC. And those have different benefits or drawbacks in terms of energy density, power density, et cetera. But lithium is in all of them right now.And so lithium felt like a good first cut, a good sort of catch-all. I'll also say that we expect that if we overall focus on reducing the raw material needs of the energy transition, those benefits carry on beyond lithium, right? A lot of our suggestions would also reduce mining of other materials, including those outside of the battery, right. Like copper, if we look at the broader car. So we chose lithium for those reasons. One other thing to sort of note is that lithium has also been a particular target of a range of public policy and corporate strategies over the past couple of years, right.I hate to kind of use imperialist language, but I'll just use it because it's how the media frames it. Right, there's like a scramble for lithium, a rush for lithium, a lithium boom. It's considered essential and strategic by public and private sectors in ways that are also making it sort of a laboratory of new corporate and public policies. And so that's another reason to focus on lithium.David RobertsYeah. Kind of an early indicator of how these institutions will approach decarbonization more broadly or materials more broadly.Thea RiofrancosAbsolutely. And playing into that and also kind of a result of that at the same time is like the crazy price volatility with lithium over the past few years. And maybe volatility is not the best way to put it, because it's been just consistently rising. Over the past decade it's been super volatile, big crashes, big booms, and busts. But in the past few years, we've just seen steady increases, getting to the point of historic highs last year. So lithium is now a huge factor in the price and affordability of batteries, which are in turn, the main and most expensive component of an EV. So from a totally different angle, we care about how much are batteries an EV is going to cost, and why? What is their cost structure? Lithium is like a good place to look as well.David RobertsLet's talk about lithium, then. Let's just start with... because it's funny, prior to EVs, the lithium market was looking from the perspective of what it's going to be in a fully electrified world, pretty sleepy, kind of backwater market. And it's one of many things in the energy transition world that is sort of quite suddenly being expected to 10x itself. So let's just start with the lithium market as it exists now. Where does it come from? You say there are four main countries where lithium is mined. We should say—most listeners probably get this—but we should just say lithium, the raw material is spread pretty evenly all over the world, but it's mined in very specific places.So talk about where those are.Thea RiofrancosYeah, with a lot of extractive industries, but really very much so with lithium, the map of deposits or of underlying existing lithium in the Earth's crusts or oceans is totally distinct from the map of production, right. The map of production is a really small subset, so that's important to keep in mind. But where it's currently mined is Australia, Chile, China and Argentina. Those are the top four. Those have been the top four. They've actually jockeyed and sort of changed positions at different moments over the past few years. But those have been the top four. They are the top four, and they will sort of be the top four for at least the next few years, right. Mines take a long time to build, which we can talk about if we want, so that's not going to instantly change. But I foresee that in the next decade thereabouts, we're going to have some different players on that top, and it'll be more like a top ten list rather than a top four list, right. But that's where it's mined now.And one other interesting thing about lithium—we don't have to get too nerdy about lithium per se—but it's a weird element because it's a very reactive metal. So you don't find it as a metal in nature. You find it in all these heterogenous compounds, right. So there's lithium-bearing clays, there's lithium in geothermal brines, there's lithium and non-geothermal brines, there's lithium in the spagamine, there's lithium and other types of hardrock deposits that haven't actually been mined so much yet, but will be on the horizon. There's really low concentrations of lithium in the ocean. I don't see that as per se the next frontier, but it's there. So there's lithium comes in all forms, really, and each of those has, like, different extractive techniques, different environmental impacts, x, y and z, but it's really variable.David RobertsOne of the things that follows from that, from it being reactive and thus not found in pure form, is that whatever it is you're digging or hauling up, you then have to do a lot of processing to it to get the lithium out, which is tends to be the gross part. So let's get nerdy a little bit. There are two main mining techniques you talk about in the report, hardrock and brine. Let's just briefly go through those. So, like, hardrock is in, as I understand it, Australia. Tell us what hardrock lithium mining looks like. Just like, what's the process?Thea RiofrancosThe nice thing about this form of mining from a listener's perspective is it's much more like every other form of mining that we're familiar with, right? So we're removing large quantities of hard rock. This is in Western Australia. That's where the lithium assets are there. And then there's a basic level of processing that happens in Australia which separates out what is considered waste rock, right, from where the lithium is in higher concentration. And then pretty immediately, the vast majority, like 95% of still relatively unprocessed lithium is then sent over to China for further processing and refining. And then that enters rather directly into, of course, their battery production.David RobertsAnd then there's the brine technique, which is grosser, I think, fair to say. Maybe just briefly describe what it means to have lithium and brine and what it involves getting it out.Thea RiofrancosI had the opportunity to see some of the brine operations in Nevada. I got a very cool mountain view of them when I was actually looking at the Rylight Ridge Project. And that... if you sort of hike around a bit, you can look at the Silver Peak brine production in Nevada, which is the one lithium mine in the US now in production. So we have brine in the US We also have Brine in Chile and Argentina and elsewhere in the world. So, Chile is a place that I've done a lot of research, but the processes are quite similar in Chile and Argentina, and actually also in Nevada.In fact, the way that brine is removed and evaporated—which I'll get into in a moment—in Chile, was first developed in Nevada and kind of exported to Chile. So there's kind of an interesting whole story of, like, US Chile mining relations in both lithium and copper, where there's been a lot of back and forth knowledge and technical expertise and that sort of thing. So, anyway, in Chile, you have the oldest and driest desert on Earth, in a way that driest place on Earth, except for some subregions of Antarctica. So it's extremely dry. But the oldness is important because there's a huge amount of scientific value in the kind of evolutionary processes and the origins of this desert that are worth thinking about while all this mining is happening and sort of destroying some of those landscapes.So, right now, mining for lithium happens in the Atacama Salt Flat, which is in the Atacama Desert. That really old, dry desert I just mentioned. And the salt flat is enormous. I live in Rhode Island, the state of Rhode Island, which is a very small state, but the Atacama Desert is like two-thirds the size of the state of Rhode Island, right? It's very big, and it is like just breathtakingly beautiful and strange and with a very rich, both natural and indigenous history. And so when you're standing on it, you are in this very unusual landscape that's gray and white and those kinds of shades ringed with these towering Andean mountains.So I don't know if you've been had the privilege of going to the Andes, but these huge...very tall mountains, right, very dramatic, some of them are volcanic, right? So that's the kind of landscape the surface is a very crusty kind of surface, but it's not barren. So when you're walking around, especially in, like, ecological preserves and places where there's been good conservation, there are these surface lagoons and there are beautiful flamingo species that are endemic to the region that are just chilling out in the lagoons because they, with their filtered gills, kind of just suck up little species that live in the salty hunter water there. And that's how they survive.And so there's a whole ecosystem that relates to the salt flat, and there's a lot of migratory birds, as well as other animals. Underneath the salt flat at various depths, right, there is subsurface brine deposits. So these are deposits of extremely salty water—much saltier than the oceans—that within them have various kind of valuable minerals suspended. And one of those is lithium. And so the basics of the way this works is that the subsurface brine is pumped to the surface. You can think of like a giant straw or whatever, just kind of any well-pumping system pumped to the surface and then it is arrayed in these enormous evaporation ponds. And it is moved from pond to pond with different chemicals being added, removed such that to reach maximum lithium concentration. But what's most important is actually the work of just solar radiation, because in addition to being the oldest and driest desert on Earth, in general, this desert is considered like a poly-extreme environment. That means it's super dry, but it's also super sunny, and it's super windy, right? It's just like the super high altitude. It's everything. And all of those conditions are very auspicious for the evaporation of brine, right. If you're going to put water out in a desert like that, it's going to be thrown up into the air very quickly.David RobertsIt's funny, I was reading about this and I got to the part where, you know, I knew that the brine was down there with these elements in it, and I was thinking like, "Well, how do they, you know, reduce it down to the elements?" And it's like they throw it in a big pool and let it sit there for a while and come back to it. It's weirdly...low tech, but also weirdly like space inefficient just like big, sprawling, all that fluid sitting out in the sun. You just need giant swaths of land for this.Thea RiofrancosAbsolutely. You need a lot of land. And then there's a question of, well, we're throwing water into the air in one of the driest desert or in the driest desert on Earth. What is the implication of that? Of course, what mining companies will say is, "It's brine, not water." But what scientists that I've spoken to and read have will say is, "Well, the water and the brine are actually connected in ways that we don't even fully understand because there hasn't been quite enough research on it." But the subsurface water system, they are porous boundaries. How porous they are is a subject of scientific debate between underground freshwater, which is absolutely essential to human life, to animal life, to other industries, right. Porous interfaces between that and then the subsurface brine.And so the question is—and this is the real point of scientific debate—is whether pulling out that brine is actually pulling down the freshwater through the forces of gravity and nature of pores, a vacuum and the whole thing. But also because the downward pressure in the nucleus of the salt flat creates a depression, which further pushes down the brine and also potentially further pulls down the water at the edge, the freshwater. So there's a whole complex kind of desert hydrology.David RobertsAnd in terms of environmental impacts, let's just talk about what's nasty about it. I mean, I think people can get sort of a picture when you're digging up big pieces of land, you're using lots of land for these evaporation pools. Presumably, when the water evaporates, it's not just lithium left behind, right? There's all sorts of other stuff. What happens to all that other stuff? What is the sort of environmental risk here?Thea RiofrancosRight, so there is like, piled up waste salts that are left behind. The companies will say those aren't toxic, but physical waste being removed from underground and piled around in a place that nature did not intend it. I think the most important thing, though, is what I was just talking about, which is the watershed, because this watershed is already exhausted. And that's a technical definition, not just me being an environmentalist. Like it's called exhausted by the Chilean water agency. And there are multiple reasons for that. There are multiple compounding factors. I will definitely call out the copper industry as being the worst.The copper industry uses so much fresh water that they've had to switch to desalination plants because there's not enough fresh water. And they have built the largest desalination plant in the world, I'm pretty sure, to serve one enormous copper mine in Chile.David RobertsWild.Thea RiofrancosAnd that desalination plant is on the coast, obviously, the water is desalinated there from the seawater, then—where very energy intensive process—polluting. And then that water is shipped to the highlands where the copper mines are. So that's the number one impact on freshwater is how it's been exhausted, a lot of it because of the copper industry, which is in the same location.David RobertsAnd copper, we should also maybe just say, as a side note, also expected to rise considerably...Thea RiofrancosDramatically.David Roberts...under clean energy.Thea RiofrancosRight. Because of the copper wiring in the cars, the copper wiring and the transmission lines, the charging stations, our whole, "electrify everything" is very copper-dependent under current technologies. So there's that. There's climate change, which is further desert-ifying—I don't even know how to pronounce that—the desert, right? Like it's making it drier. So there's that issue, and then there's agriculture, there's human consumption, and there's lithium, right? So there's a variety of stressors on the same water system, and as a result, it's been called exhausted. And they say that they're not going to give out more freshwater permits x, y, and z, right?So that's just like the context that it's in. And where the debate is with lithium is how much removing vast quantities of brine—we're talking about like thousands of liters a second, I believe, if I don't have that wrong—vast quantities of brine by these two major mining companies, SQM and Albemarle, is further playing into this watershed exhaustion. Another thing that's interesting to note, to go to sort of a totally different type of environmental impact that we humans may not think about very much, which is microorganisms.So what's fascinating about the brine is that it's actually an ecosystem. It's not just dead salt water, whatever that would mean, right? Microorganisms live in the brine, both in the surface salty lagoons, but also in the subsurface brine deposits. There are microorganisms, and those are important for a variety of reasons, but including they hold clues to evolution and the origins of life on Earth because of how old this desert is and also how poly-extreme the environment is, replicates earlier Earth conditions, but also like Mars conditions. So if we want to understand, could there be life on other planets, scientists say we need to understand how these microorganisms can survive.And not only this super extreme in all the ways I listed, but also, like, some of the saltiest environments. And saline is really hard on organisms, right? And so it's amazing that they can survive in this hypersaline context. But we're basically just sucking them out. We're killing...they're not going to survive the process of lithium extraction. And that, again, may not depends on the listener, how much that matters, but there's a lot of science that says these microorganisms are important for a variety of reasons and we should think about conserving them.David RobertsThere's a lot more detail in the report, but let's just consider it settled. Lithium...lithium mining, everywhere that it exists is pretty environmentally nasty. And another thing you point out in your report is that almost everywhere it exists, there is opposition to it, local opposition to it. Indigenous and other groups organizing to protect landscapes, organizing to protest the fact that they're not consulted, they're informed consent was not gained. Sort of all the capitalist evils that spring to mind when people think about mining are on the loose in lithium mining, and it's opposed almost everywhere it is happening.And that is kind of just the important background here for everybody who's thinking about decarbonisation in this way, which is that, like we said, yes, it's going to be better to do this than to continue pulling gazillions of tons of fossil fuels out of the Earth every second of every day. It's going to be better. But every step you take towards more lithium, there are tangible harms being done to vulnerable people. That's something we can't ever forget as we're tossing these things around.Right now, it's relatively small. There's four countries involved. There's a lot of talk about vast expansions coming. There's a supposed supply crunch over the next five to ten years as, like, demand is rising much faster than supply. But there are also, as the report points out, these huge discrepancies in projections, depending on who you believe, how much lithium is going to be needed. So just give a sense, like, how fast and big the lithium mining sector is going to expand. How big is the pressure to expand here? And what do we mean? Are we talking about twice the size, ten times the size?Thea RiofrancosIt depends who you ask, as you already noted, right. And everyone agrees: big increase. But beyond that general consensus, there are differences. And I know you recently had a conversation about modeling, right? And like how much goes into modeling. And I have never been more convinced of this than I am now, both in diving into the existing models and what their assumptions are, but also in seeing some of the contrast with our report, which we'll get into later, and how different the findings can be if you change some of those assumptions or play around with them in some way, right.Models are not, like, written in stone or laws of nature. There are a lot of human decisions made sometimes with political and economic interests at play, right? So everyone agrees big increase, right. As you noted earlier, like, lithium was, and actually could still be considered a rather small market. For a long time, it's mainly been about personal electronics, but also it's used in some construction glass materials as a coolant. It's used in lithium as a psychiatric medication. But it's really like the EV market that has been a game changer, right? And what's been the case for the past couple of years, and will be the case even more so going forward, is that batteries for passenger EVs, specifically, are the number one driver of demand for new lithium, right? So that's also important to sort of keep in mind. They vastly outweigh any other end use in terms of why there's so much talk about lithium demand.So, a couple of ways to cut the cake. And I'm drawing on a mix of our report and other existing forecasters out there. One way to think about it, and this comes from our report, is that if we just look at today's demand for EVs and then project outward to the future, taking into account growth, et cetera, to 2050, the US market alone would need triple the amount of current global production.That's one way, because it's hard to wrap our heads. I mean, there's many ways to say the same thing, right? That's one way to say it, right? The US in 2050 would need three times what the whole world needs now.David RobertsYes.Thea RiofrancosAnd that's, again, not thinking about all the other countries that have their needs, right. So that's one way to think about it. Another that I can find a little more concrete because it talks about individual mines, and here we're drawing on Benchmark—they're a big forecaster, which people have opinions about, right, so I'm not waiting into that. But they are a big forecaster and they influence government a lot, particularly. So Benchmark mineral forecasting says we'd need a 200% increase in the number of lithium mines, the just number of discrete mines by 2035. So a closer time frame to meet expected demand for EVs. That's globally, not US-specific. So we need a lot more lithium mines as discrete entities.David RobertsBut this is what breaks my brain about all this. You say it can take up to 16 years to get a mine going. These are not pop up operations. So 200% more mines in the next twelve years just...Thea RiofrancosIt seems hard to meet that. Now, what will happen, and this we could talk about the implications of this, and there's a lot of debate in the climate, environmental, et cetera, community, but some of those time frames might get shortened because there's a huge pressure in the US, in Europe, and in some other jurisdictions, to fast track mines. Like right now, yes, it takes a decade...We say 16.5 years. It could be shorter, can be a decade in some cases. But we're talking about at least a decade, right, to develop a mine, to go through financing, getting your financial back errors, the permits to get the quote unquote "social license," which is like an industry term for communities, like, giving you bare minimum sort of agreement or something.David RobertsThe thought of all that happening lots, lots faster does not calm my heart.Thea RiofrancosMe neither. And I think there's a whole separate conversation. I know you've dealt with this in other writing and on the show, but like this permitting conversation, I think speed gets equated with outcomes in a wrong way. I mean, saying we're going to do everything faster doesn't actually always make it faster, because what that means is there's various corners being cut, which just turns into lawsuits. So actually making the timeline for NEPA faster in the US case does not actually per se mean we're going to get the lithium faster. So that's a separate conversation, but I just want to throw that in there.Okay, so a lot more lithium. I'll throw out one other statistic because it's the one that alarms me the most when I try to grapple with it. It's the international energy agencies from 2020 or 2021, from a report a couple of years ago where they said compared to a 2020 baseline, we need 42 times as much lithium in 2040. That's like an enormous increase. I think that means 4200%, if I understand math. I don't know. Or 4300 percent. Whatever it is, it's really big. It's a large increase, right. It was larger than any other mineral they tracked.David RobertsYeah. And this is wild. I don't even know that we have to spell it out, but just like, let listeners just imagine what is a global rapid herding toward more mining? How is that going to play out? The idea that it's going to be done more sensitively or with more consultation with indigenous groups, et cetera, et cetera, when everyone is basically panicking and trying to do it as fast as possible, it's just not a great recipe.Thea RiofrancosRight.David RobertsAs the last comment on lithium, let's talk a little bit about the coming supply crunch and where... one of the big things the report talks about is these four countries are the main lithium mining countries now. But obviously with this sort of global stampede on, there's going to be a lot more mines in other countries. So where can we expect mining to branch out? And what is the timeline of that versus the timeline of this crunch?Thea RiofrancosOne thing to note at the top is that there already is a lithium supply crunch, right. We're already in that domain, so to speak. And the way that we know that is that the prices for lithium have been historically high, right? Because supply, demand, price, et cetera, right. Supply is not keeping up with demand. And that is important to our renewable energy kind of wonk and industry folks on the show that are listening to the show, because that, is in turn, changing something about battery pricing for decades and for sure since 2010, which is when Bloomberg started tracking this, but you can go back to earlier data from other sources.For decades, lithium ion batteries have been decreasing in price in a sort of secular trend based on R&D, economies of scale, innovation, manufacturing efficiencies, all the things that make things cheaper under capitalism when that occurs, and that is priced in kilowatt hour. And this sort of, like, the idea was we're going to one day get to $100 per kilowatt hour, and that will get us to price parity without taking into account subsidies with ICE vehicles, right? So that was the sort of golden target. In 2021, they plateaued, they stopped that decrease, and we didn't know what was going to happen in 2022, but now we do.So in 2022, they rose for the first time, and we went from like 130-something, 135, I think, to like 151 per kilowatt hour. I'm not trying to be like a doomsday or I'm not saying they'll increase now from here on out. I don't actually think that. But I do think it's important because the reason battery prices, for the first time since Bloomberg started tracking this, have increased in price is because of raw materials. So, in an interesting way, because we've done all this manufacturing efficiency in R&D, and we really cut costs on all other parts of the process, the raw material components are logically a larger component of the cost structure.At the same time, coincidentally, those raw materials have increased in price in their cost, right. So that is why batteries are now more expensive. I'm sure things will settle in whatever way, especially as we build up a lot more battery-manufacturing capacity around the world, which will depress prices. But it is true that this is starting to call into question, further question the affordability of EVs, because these are the main and most expensive component of an EV.David RobertsRight, which in turn sort of complicates these long term projections of EVs, which in turn complicates the long-term projections of lithium demand. Like the whole...Thea RiofrancosIt's all circularly interrelated. But we can definitely say that there's been a huge rush to mine lithium in the US Which is just another reason for people in the US to think about this. It's not just about stuff that happens far away. This is happening here. We have 50-odd projects with some level of financial backing or permitting in Nevada alone in one state.David RobertsWow.Thea RiofrancosThat's tracked by the Center for Biological Diversity by Patrick Donnelly. Shout out to him because he's been tracking that. It's really hard to compile those statistics. And the US government is throwing money, $700 million at Ioneers mine in Rayte Ridge. That's the Department of Energy just gave them a huge loan.The auto industry is throwing money. GM just gave $650 million in equity stakes to Lithium Americas for their Thacker Pass mine—which is, by the way, in federal court right now, over fast tracking concerns raised by environmentalists, so, the whole thing.David RobertsAll of these are facing opposition. Like, almost everywhere a lithium mine exists, it seems like there's some opposition. It's funny that's one of the things I've been sort of joked about with the Inflation Reduction Act is everyone loves the idea of onshoring the whole supply chain as a slogan. Everybody's super into that. But there are lots of links in the supply chain that are pretty nasty. I'm curious what their political valence will be once people get a little closer look at, like, what mining and processing of lithium really looks like, whether they'll be so excited about onshoring it.In the report mentions in the brine area, there are new techniques of mining lithium from brine that are less impactful than the traditional sort of, "leave it out in an open pit while the sun bakes it" technique. So it's not that lithium mining is a fixed quantity of environmental destruction. There are better and worse ways to do it, could be better or worse, governed, regulated, all these kind of things. But we got to move on to the second half of your report. So the report focuses on, it says, "Okay, we need to electrify, but we'd like to do it in the least lithium-intensive way possible."And so you focus on the US Transportation sector because, as you note, that's a huge, huge driver of lithium demand, and you focus on personal vehicles, which are the bulk of US transportation emissions, and therefore they're going to be the bulk of lithium demand in the future. And so the whole question here is: how could we decarbonize the US personal vehicle sector in the least lithium intensive way, otherwise known as increasing lithium efficiency, "Getting more mobility," I think this is the title of the report. "More mobility out of less lithium" is the idea here.This is, I think, a great part of the report because in some sense, once you see it on paper, it seems obvious, like, yeah, if lithium is bad, we should think about how to use less of it. It just seems sort of obvious, but it is wild how much total auto domination in the US is just taken for granted and invisible in most projections of car demand and for lithium demand, it's just an unspoken assumption that the current pattern of auto insanity in the US is going to continue. So in a sense, it's, I think, a great advance in the state of things just to say, "Maybe we could do it differently." There's other ways, other ways to do it. Yeah, it's not, as you say in that first quote, "It's not a fixed thing."We have choices here. There are different ways things could go. So you lay out four scenarios. The first scenario is just: assume electrification of the existing number of cars on the US and otherwise everything stays the same. The car, the auto intensity, the land use, the amount of car use stays the same, and we just try to electrify all the vehicles. In a sense, I think it's tempting to sort of take that as the default scenario, but one of the points you make in the report, which I think is important, is it's not obvious that that's the easiest way to go.It's not even obvious that that's possible. So let's first just talk about that, because it seems like kind of what we're stumbling toward, which is just take the cars for granted and try to electrify as many of them as possible. So just tell us maybe what's wrong with that, the sort of status quo we're stumbling toward.Thea RiofrancosRight. Well, first of all, it assumes an enormous quantity of EVs are going to be bought by people, which is, in a way, an assumption of all of our scenarios to be fair. All of them involve what we could call the mass deployment of electric vehicles. None of them eliminate electric vehicles entirely. They just change their relative predominance within the transportation mix in various ways, right? But in scenario one, the most need to be purchased, right? And so first and foremost, it's a question of millions of individual consumer decisions going as planned.And it's a question of how much our policy environment and especially financial incentives will need to change pretty rapidly in order to make that a reality. Because I don't know that IRA is going to cut it. Putting aside all the debates over the specific mechanisms IRA uses, it gives rebates, you know, at a below a certain income threshold that can get up to, I think, $7,500, you know, not nothing. And so that's the approach in the IRA, but I already noted and we've talked about how these vehicles might be getting more costly over time. I mean, there's different trends at the same time, on the one hand, the batteries are getting more expensive, which will make the cars more expensive. On the other hand, now, all the car companies are saying we're going to out compete one another on price and we're willing to forsake a little bit of profit. These are uncertainties. I don't know which will, on the balance, which will be the prevailing trend.David RobertsWell, also in the key dynamic you point out in the report, which is if lithium demand is as high as it would be—looking at the US car fleet—that exacerbates the crunch, exacerbates the high price.Thea RiofrancosYes, right.David RobertsSo in a sense, trying to sell more is almost self-limiting.Thea RiofrancosYes, that's an excellent point. And so that is one problem with scenario one. Like will we have to increase subsidy? I'm not anti-subsidy. I'm not like anti-government spending. I'm, like, in favor of government spending. So it's not like I'm trying to do some taxpayer-efficiency thing or like star of the beast thing. It's not about that I mind spending public money. It's like on what, right, because all of this involves public money. Whether it's EV subsidies, whether it's those might be more invisible forms of public spending, but the more visible forms are the transportation authorities and then of course, highways.So all this involves public money, but this one involves trying to use public money to shape individual consumption decisions and that's not the most efficient way, right. And it would be more efficient and we'll go through this with scenarios two, three and four to actually use that to beef up mass transit. So that's one issue with scenario one, or a couple, I guess. Another, though, relies on peer research, not our own research, but other folks that we cite which say that we will get to zero emissions faster if we get people out of cars. And so we don't directly test that because all we're looking at are 2050 scenarios. So we're assuming zero emissions in 2050. And what we're playing with is like, how we're going to get there.But other people that test: will we get to zero emissions? or how fast will we, show...and this stands to reason, right, like the fewer vehicles on the road, the more people are sharing the same vehicles, the easier it is to electrify more quickly, because if you electrify a bus, you deal with many people's transit at once. And also even before you electrify the bus, that's still like a net positive if you're getting people out of an ICE car into a bus, like you've dealt with some carbon emissions before you even make it an e-bus, right? And so there's a lot of...this is what I like to say to the carbon hawks among us, right? To people that really unilaterally focus on...which I, in some ways, count myself among, but I'm less unilateral, like, I'm also thinking about biodiversity and all these other issues, but for people that are like, "All I care about is the emissions trajectory." We will lower emissions faster if we don't do the super car-dependent one-to-one EV to ICE swap, right, or ICE to EV, excuse me.And it's not even one-to-one. It's more we have to produce more EVs over time as the population grows.David RobertsDemand is rising. Yeah. Population is rising. Yeah. I mean, you point out that there's some doubt in a lot of scenarios and modeling whether we can even hit the 1.5, whether we can get on a 1.5 consonant scenario or even a two degrees consonant scenario with this sheer volume of cars that we have to electrify, right? It's an enormous amount and it's rising all the time. So lowering the amount of cars is lowering the target to more achievable levels. So that's important. So I just want to get I think people maybe think that this is kind of the default thing we're heading toward, which is just samesies with all the cars except they're electric now.Whether or not you think that's the best way to go, there's real reason to doubt whether it's possible to do that. Certainly on the time frame we're talking about.Especially as the cars get bigger, right? There's that other research that's not ours. We do a lot on battery size, so we'll talk about that. But there's a separate research academic article that just came out a few months ago showing that the e-Hummer, like when we get really large, like really gargantuan batteries, cancel out their climate benefits, meaning that the carbon-intensity of that supply chain to produce that vehicle adds to emissions rather than decreasing them, right? And so that's when we get at the real extremes of car size. I'm not saying every EV is an e-Hummer. It's just not right.But unfortunately, our trend is trending upward in size. And so we also, back to our earlier analysis of supply chains, have to think about emissions across the supply chain. Right. And when we produce enormous vehicles that then are shipped on container ships like these just enormous production networks. And if those are not fully decarbonized as production networks, then we have to factor that in.Yeah, embedded embodied emissions are huge here. So, you have four scenarios. The first one is just everything stays the same except it becomes electric. And then scenarios two, three, and four are, sort of, I guess, escalating versions of europeanizing American cities. I'll just say upfront, you summarize towards the end here relative to scenario one. With scenario two, you get an 18% reduction in lithium demand. Scenario three, it's 41%. And scenario four is 66% reduction in lithium demand, which is... that's not marginal, right? So these alternate scenarios you're talking about are real substantial reductions in lithium demand.Thea RiofrancosMore than I expected. Like, honestly, as someone who's looked at this for a while but never read a study like this because...not existed. But my assumption was it was going to be a little lower, though still important, still significant, but it was higher. And it gets even higher over time. Like if we go all the way to 2050, we can get a bigger spread, partly because by that point we have more recycling feedstock to work with and other changes that are more cumulative, take place. And so, it gets really dramatic when we look at best and worst case in like the year 2050, for example.David RobertsBut...and this is maybe an area where I need you in specific because I know you always have good things to say about thoughts like the ones I'm having, which are I'm looking at these scenarios. Just scenario two, the first level above one, it says, and I quote, "Levels of car dependence in US cities and suburbs are reduced to the equivalent of comparable EU cities." And to me, just that just getting US cities and suburbs on par with comparable EU cities is alone just mind-boggling in its scope and its political difficulty. And I just look at that and I feel daunted.And I know you're always going on about we need to expand our imaginations, we need to push the window open, and we need to think more about what's possible and not feel locked in. But, in scenario three goes...Thea RiofrancosMuch more ambitious.David Roberts...farther than that. And then scenario four is basically like: every US city becomes Vienna. Every US city becomes not just average EU city, but state of the art, progressive, cutting edge. And I just have a lot of trouble seeing that happening. So how do you think about or do you bother to think about...Thea RiofrancosNo, I do.David Roberts...the political realism of what are very, very substantial reforms in US land use and habits and public spending and on and on.Thea RiofrancosYes. So there's a lot to dig into there because I absolutely do think about it. And I'm a political scientist, for whatever that's worth, and also someone who's done a lot of political organizing, legislative advocacy, et cetera. So as utopian as I can sometimes perhaps sound or feel or whatever, I mean, I have ambitious ideas. I'm a big proponent of the Green New Deal, et cetera. I do think about the brass tacks of moving people on issues and of what regulations or what legislation will be necessary and what's possible at the state or local versus federal level.And I want to talk about all those things. I want to say something first, though, is just like a set piece, which is we've been treating these as like four big different pathways, right? Which they are. But what's important to note is that there are subpathways and subpathways meaning there's actually like dozens of scenarios that we test because there's a lot of on-off switches that can apply to each of these. And one key one is battery size. So let's go back to that scenario one that we've been talking about, which is the status quo but electric, or the status quo plus population and consumption growth, but everything EV, and it turns out it makes an enormous difference if we can just get back to where we were a few years ago with average battery size in the US, or where our peer nations are, or peer affluent nations like in East Asia and Western Europe are with battery size. We're now like double the size of a decade ago. We're double the size of the global average. And what's concerning is that...David RobertsGod, that's so dumb.Thea RiofrancosIt's so dumb. Because there's so many reasons it's dumb. Those cars are unaffordable to most Americans. The larger the battery, the more expensive the car. But it's also just being sold in a sort of luxury framework, right, of these fancy pickup trucks and fancy SUVs that contractors aren't using. I mean, it's just like affluent suburbanites for the most part, and they're using them to go to the grocery store, not to go hiking or to, like, haul stuff.David RobertsI know. And I get that every new consumer product you start on the luxury end, you make it an object of desire, and then you and then you move down. But like, we're like ten years into this s**t, and...Thea RiofrancosIt's getting worse! It's moving into opposite direction.David RobertsI know. They're getting bigger and bigger...Thea RiofrancosLike, now it's like everything is the Ford e-Lightning or whatever.David RobertsI know. Okay, let's get like some freaking hatchbacks now. Like we did it.Thea RiofrancosIs what most working and middle class Americans can afford and drop. And so we're getting really crazy with the average battery sizes double, as I said, the global average double where we were a decade ago. And it's concerning because it's a trajectory. So are we going to be triple that in a few years? Like, where is this ending? But, the good news is, that we can be as car dependent...we can change like, nothing about the political, social, cultural infrastructural status quo. Like, we could stay with our car dependency in all the ways that that's locked in.And we could get really significant decreases in lithium volume, especially as we get closer to the end of our...we get to 2050. So in 2050, just snapshot year, because that's our final year that we model. We could have 42% less lithium in scenario one, the car-dependent scenario, if we have more normative—I don't want to say smaller because it's misrepresents it. It's like more normative sizes.David RobertsNormal-er.Thea RiofrancosNormal-er.David RobertsNormal-er batteries.Thea RiofrancosWhere we were recently, and where most of the world is now.David RobertsLike, when I first read through, I thought that the reduced battery size demand in your scenarios was a causal result of land use changes and walkability....Thea RiofrancosNo, it's a separate parameter.David RobertsSo you're just turning that knob...Thea RiofrancosFor each scenario.David RobertsIndependently.Thea RiofrancosExactly. Which is why—and I'll just say it here because it's my favorite of our findings, because it's the most dramatic—that if we compare scenario one like the car-dependent scenario and with large batteries, ones that are currently larger than average, but is, like the direction we're going. We compare that to scenario four with small batteries, with perfect recycling, with everything, like ideal utopian Vienna, whatever. In 2050, 92% different in lithium volumes, right? So there are radically different futures ahead of us. And it's helpful to look at the extremes, even if our worst case is, like, unlikely on the negative end and our best case is unlikely on the positive end.Let's look at the total spread, because that's the spectrum we're working with. And that's where we can use policy, behavioral change, cultural norms, whatever is available to us as tools to shift people towards the best case scenario.David RobertsYou highlight three specific changes that are the most efficacious kind of levers to pull to reduce lithium demand. There's reducing demand for vehicles overall, densifying urban centers, and then reducing battery size. I get reducing demand for passenger vehicles. You do that with better public transit, better land use. You do that in part through densifying urban centers, increase walking and stuff like that. But it's notable that battery recycling, which people are quite bullish about, doesn't really make much of a dent for quite a few years. So maybe just tell us a little bit about what is the state of recycling, what you expect from it?Thea RiofrancosYeah. So what's interesting about recycling is that you need to have enough feedstock available. Meaning, like, if you're going to use recycled, recovered materials to manufacture batteries instead of new mining, which is the goal, we want to use circular economy kind of approaches so that the end of life batteries and also the manufacturing waste, all the things that are spit out by our system, like reenter the loop. And we close the loop. And so instead of new mining, we're sort of like we're mining batteries, right? Instead of mining the Atacama Desert.David RobertsRight.Thea RiofrancosSo that's great. We're super proponents of it, and there's very optimistic results shown in terms of how we can get close to 100% material recovery. The technology is there. That's what I want to start with.David RobertsMaybe it's too obvious for you to even say, but I'll just put it out there. Signpost is just even best case, recovering 100% of materials. You still have to get enough materials in the loop in the first place.Thea RiofrancosThat's where I'm going. We're several years out from that being significant because we don't have the level of EV penetration yet. And then forget about just the current level of EV penetration. How long do people own their cars? Hopefully, these cars last a minute, right? Like they're durable goods, right? So, yeah, it might be ten years, you know, whatever it is, right. Until we're actually end of life with those batteries. And then it's interesting. I'll just throw this out there because I think it's it's kind of interesting and it helps people understand how materials cycle through systems.So when we get to the end of life of a battery in a car, it no longer gives the power and energy density that a car requires to move quickly and for distance. At that point there are a number of other applications we could use the battery for, and we often go to the grid as the first thing, and that's great. Backup storage or primary storage, even on an energy grid because of variable solar, wind, et cetera. So we can store energy, but also we can even use it for less intense mobility applications, right? So, like, a city bus does not move as quickly, it also gets much more frequent overnight charge. There's a variety of ways in which buses strain their batteries less and can work with a second-life battery. So there's lots of interesting applications. But there's a critical choice there, like, do we put the battery in a second-life application or do we strip it of its materials and use those materials to become feedstock for new...and I'm not trying to make it, like, a zero-sum thing, though I guess at the literal cell level, it is, right, like one or the other is happening.David RobertsDon't you want to do both? I mean, can't you completely exhaust the battery and then get them...Thea RiofrancosIt puts the horizon back, defers the horizon because if we're reusing then and... reduce reuse, recycle, that old environmental thing is actually useful to remember. So we're talking about reducing lithium demand in this report. We're also talking about reusing and recycling at the sort of end of life. Right, but you first reuse, then you recycle, but it just pushes out the time frame for when we'd have enough recycling feedstock to really be replacing significant amounts of new mining.David RobertsRight.Thea RiofrancosAnd one other way I like to, just as a metaphor, think about it is: over the pandemic, we've had lots of debates on different public health tools and one thing that public health experts said about the vaccine is that if we don't reduce the spread in other ways we're asking the vaccine to do too much work.David RobertsRight.Thea RiofrancosIt's not a perfect analogy, but I think that way about recycling. And I think people gravitate to recycling because nothing else has to change and also because it's itself a business opportunity, right? There's a lot of new investment in recycling facilities. So it's sort of like, "Oh, that's the silver bullet. We're going to get recycling to sort of totally replace new mining." Well, maybe in 2050 or 2070 or something that could start to be possible, but not in the near term. And so we need to do other things so that we're not expecting recycling to be the number one demand reducing tool.David RobertsRight, so you're reducing demand for lithium in the first place helps...Thea RiofrancosRecycling play a bigger role.David RobertsRecycling, it helps decarbonization, in addition to helping reduce the need for mining and injustice and all that other stuff, it just makes...the lever you can pull that makes almost everything we want easier to do. So you have these scenarios that basically involve—and this is stuff I know Volts audience knows very well—just your basic densification, helping walkability, bike paths, all that kind of stuff. So, let's just say a bit, because I don't want this to get lost. In addition to all the benefits of reducing lithium demand in terms of our ability to decarbonize on schedule and are just having enough and getting recycling going better, it's also worth noting that all these changes being discussed in the transportation sector have numerous co-benefits and, specifically, are extremely beneficial to the poorest and most vulnerable.This is all completely extrinsic to the greenhouse gas discussion. Just these changes you're talking about making in transportation are good for a bunch of other reasons and so I think...probably we mostly get that. But let's just say a brief word about how transportation in the US is specifically a kind of source of injustice and how these reforms would serve justice.Thea RiofrancosThere's so many things to talk about here that we won't get to them all, because it's such a sort of nexus of where so many injustices inequalities and also inefficient uses of resources kind of intersect. One thing to remember is just how financially burdensome car ownership is for low-income and working class and even middle class people. Buying the car or leasing the car, the auto insurance, the maintenance of the car, and the gasoline—until we electrify, right. Caveat there on gasoline point—but are all very expensive, and they're more expensive the lower income you are, they're like a bigger portion of your overall income, right?And they're also more expensive if you're lower income because you're more likely to have an older car, which requires both more maintenance and more gas per mile. And so we think about car use as a form of freedom in the US. And there's tons of scholarly books written on this and just a million pop culture examples and just the advertising of the auto industry itself. It's thought that carnership is like a key to freedom understood as this sort of spatial mobility. Like, you go wherever you want, right?David RobertsSuper generational, though. Super generational thing. A real generational divide, I feel like.Thea RiofrancosYes, I agree, and I'm hopeful about that. And we should come back to that point because we still haven't really discussed the policy tools and the politics of this in the contemporary moment. But I think of it almost the opposite way, which is, like, total choicelessness, which is unfreedom to me.David RobertsA single choice. I mean, literally the only way to do something.Thea RiofrancosAnd I know that very firsthand, not to make it too personal, but for many years of my adult life and childhood and everything, I didn't use cars very much. I grew up in New York City, right? So I'm weird in US context. So I grew up in New York City. I use public transit. We just use a car if maybe we're going upstate to the Catskills. But, basically, I'm going in public transit, and I'm walking. Then I become 18, moved to other places. I moved to Portland, Oregon. I then live in Philadelphia. I live in some Latin American cities, et cetera.In all of these places, I used a bike. I used mass transit, or I walked. And I did not actually get a driver's license until I moved to Providence, where I currently live. And after the first three months of biking to work, which was really not a great situation, there were no bike paths, like, it was extremely stressful and dangerous. But I did it because I like bike riding. And it was only 20 minutes. It wasn't a big deal. It was just a stressful 20 minutes. Once November came, New England, right? So it got cold. It's like, "Oh, I guess I have to do something else to get to work."I looked into the bus situation. Impossible. Like, an hour bus first is, like 20-minute...because I had to go downtown first, go to the main hub. I mean, the bus is for stigmatized poor people in Rhode Island, basically. I mean, that's how our bus system works. It doesn't have commuting in mind. It doesn't have other types of users in mind, and it's just underfunded and a whole crisis.David RobertsA very familiar story, all Americans, I think, will have some familiarity with.Thea RiofrancosAnd so I got a license. Like, I was forced to get a license, and I started using my partner's car, which I had never driven before, to get to work. And I experienced that as a constraint, like, I have one option.David RobertsAnd more stress, I mean, this science on this is very well-settled. Like, you probably were taking years off your life by switching to a car just from the noise stress.Thea RiofrancosExactly. But so there's lots of benefits of moving us into these other scenarios.David RobertsLet's talk about the policy levers that you're talking about. A lot of these I think, will be familiar to my audience here, just sort of urbanism stuff. But did you have particular...because I know one of the things the report says is that transportation decarbonization policy, insofar as it's popped up in the US, especially at the federal level, is very car-centric. Talk a little bit about better policies.Thea RiofrancosYeah, so I want to circle back to something you said earlier that's on this point about can we imagine the US being like a European city, or not the US, but US. Cities. That seems utopian, as you said. And I understand that. But I want to also just note that things have changed a lot in European cities, recently.David RobertsYeah.Thea RiofrancosAnd you reported on this in Barcelona and maybe elsewhere, right. And so we could go to Barcelona, we could go to Amsterdam, Paris, London. Our global cities in Europe, like the cities that have a lot of stature, those were actually more car heavy a decade ago.Two decades ago. They used policies ranging from the design of streets, right, the super blocks in Barcelona that you discussed to like congestion pricing to increasing mass transit options, to designs, making mass transit free or lower cost, a whole battery of kind of policy tools. And significant, like in Paris, they decrease car use by 30% over 15 years.David RobertsWild, what they're doing so fast.Thea RiofrancosIn London by 40% over the same time period. In Amsterdam—and we think of Amsterdam as like the cycling haven—but that's increased over time. Like they have actually used policies to make it more friendly to cycling. These things that we think of as so, like exotic, like, are actually the outcomes of intentional policy decisions that took those cities off of a track, getting more similar to the US to a track of where they are now. So it's important to not like naturalize, exoticize, essentialize, whatever it is, like, because we could do these things too. And in fact, in cities, you know, cities and other localities and even at the state level, we have a lot more options than at the federal level, so we should look at those urban experiments very closely.You know, it's duh. The GOP controls Congress. Like, I am aware, I read the news, right. So I'm not super enthusiastic or waiting on the edge of my seat for some massive infusion to public transit authorities coming from the federal level. I don't think that's about to happen. Thankfully, we got a little in the bipartisan infrastructure, otherwise things would be even more dire. We didn't get anything in IRA. We didn't even get e-bikes in IRA. I mean, it's nutty, like how car-centric that bill was.David RobertsI don't know if this was inevitable and unavoidable, but it is unfortunate, though, that the whole reactionary, backlash, conservative movement as it exists is now more or less organizing around defending sprawl. I don't know if that was just going to happen at some point regardless, but it's just not good that one of two major parties is foursquare against all the reforms you're talking about.Thea RiofrancosExactly. This has become a culture war point. But those culture wars are a little bit less intense at the state and local level, though unfortunately, they're there too. I'm not, again, Pollyannish, but let me throw out a couple of things. So what I think would be really cool—which we couldn't directly model because of data limitations, but we do discuss—is e-bikes. So we can't yet break down, like what proportion of cyclists are on e-bikes and how much lithium is in the e-bikes, because again, the data constraints. But we know that e-bikes use so much less lithium just on the battery level and the per rider level when we compare it to any of the other e-transportation options, right. They're better than buses, even, in terms of the lithium use per person.And so we have had some cool stuff. So Denver, Colorado did a major ebike subsidy experiment, and it worked. It not just worked in its popularity, but it got people out of cars, specifically. They showed that now in research on the experiment. Hawai'i, I don't know where exactly it is in the legislature, but it's moving along. I think it's been introduced for a state-level big e-bike subsidy program. And there's a bunch of other cities, if we look them up, cities and even states that are looking into subsidizing e-bikes, both for the climate reasons, the affordability reasons, but also specifically to reduce car use. That's like their goal. So they're designed with that goal in mind and they're making sure, like, we're subsidizing e-bikes that could replace cars for grocery store trips or commuting.David RobertsAnd of course, the more of your citizens are on bikes, the more political power.Thea RiofrancosYeah, you build a constituency which you have in places with a lot of cycling, like Portland. Like literally, there's like a bike lobby. I mean that in a positive sense, right? There are people advocating and watching policies. There's a couple of other things that are interesting. I'm going to do one more on e-bikes because this was surprising to me. I just learned it. In 2021, Americans bought nearly twice as many e-bikes as ecars. There was a huge amount of e-bikes being bought, and I think there's like a variety of reasons for that. Some of it was like pandemic people doing this outdoorsy stuff and the e-bikes were coming on market at this.So I think there are some just like circumstantial factors there. But it's interesting. Americans like e-bikes, so we should think about that and think about that as like a climate policy more among climate progressives. Think about how to expand that. There's a few other things. One is bad, but I want to talk about it, which is the so called death spiral for mass transit. So there's been this ongoing thing, but it got much worse during the pandemic where lower ridership, which really dipped, of course, when there were much more limited movement due to COVID concerns. So people stopped taking transit as much, worrying that they'd get COVID if they took transit or they just weren't commuting in the first place.And then that undercut a major source of funding for transit agencies, which is the fare. And so you had this death spiral which then they would do fewer buses or fewer trains or subway cars and then that would further depress ridership because it was less reliable or less frequent. And that's the death spiral. So we're at kind of a critical juncture for transit in this country, and we need to sort of decide, like, especially among climate folks who are at least people thinking about this, do we want to actually include refunding? And actually more secure and sustainable funding models that don't just rely on the fare as much or these like emergency federal or state funding, but just have more secure funding over time, more durable.David RobertsWell, I mean, the juncture we're at is like, are we going to let our lame minimum that we have die completely or are we going to maintain our lame minimum? Effectively, outside of New York City, we don't really have, like, a full-fledged worthy of Europe in hardly any city, much less, like, all these mid-sized cities.Thea RiofrancosAnd they've gotten worse. I mean, some of them used to have better transportation in the past. I mean these streetcars, all this thing was destroyed, partly by auto industry lobbying. This history is very sordid.David RobertsIt would have to be a real huge culture turn.Thea RiofrancosYes, but I want to say it's important to remember that the first culture turn was a big one. Like getting these cities off of what they previously did, which was walking and streetcars and commuter rails and that kind of thing, into the current car dependency. That happened not in our generation but in one more back. So this stuff has not been since like the literal founding of America or whatever that...you know what I mean? Like these are all things that happened over the 20th century and dramatically.And so we have the climate crisis to deal with. We also have a variety of economic crises where we want to think about redeveloping and making cities more flourish. We have a lot of things happening at once and it's one of those other critical moments of: are we going to just let transit die or are we going to embrace it? At the very least, I would love to see progressives that are climate advocates like, fully embrace transit, e-bikes, all of these solutions that are good for a host of reasons that we've discussed and center that.David RobertsOne of the things that sort of raise an eyebrow about this is that the modeling more or less assumes that lithium is going to remain dominant for the foreseeable period of the study. Battery chemistry has lurched around a bit over the last few years, and trends in battery chemistry can change pretty quickly. Like, LFP was dead for a while, and then all of a sudden it's roaring back. I guess I just wonder if you're worried you might be underestimating the possibility of technological improvements. Because I know a. people have their eye on lithium as a bad thing because of the mining and all the rest of it, b. they have their eye on it because the prices are rising and it's threatening the entire edifice of transportation electrification. So I know there's work going on trying to reduce lithium, trying to make batteries without lithium. How confident are you that at least for the next 20 years, lithium is going to stay on top? Did you give a lot of thought to that?Thea RiofrancosI have, partly because anytime I tweet about my research on lithium, someone says to me, "Lithium will be dead tomorrow. Don't. Why are you spending so much time on this?"David RobertsI don't know if I go quite that far.Thea RiofrancosNo. But there's a lot of reply guys on this point, on Twitter especially, which has fortunately helped me, like, has had the positive impact of me thinking about this question more. So I in some ways appreciate the reply guys.David RobertsThank you, reply guys.Thea RiofrancosYeah. So, the 20-year question is an interesting one because that does feel harder for me to answer. I feel pretty confident, a decade out, that lithium ion batteries will be the prevailing technology. That doesn't mean the only one, but that changes will be at the margins and that they will still dominate when we get out to 15-20 years, I still feel like due to some costs, due to the prior investments, due to the fact that there is just like an energy density advantage with lithium over anything else, those are still all true, and those, I think, will still make it the sort of majority technology.But after we get to 15-20 years and beyond that, I think that there could be substitutes. But let me say a couple of things. So people got very excited about the CATL, the major Chinese battery manufacturer, announcing that it was going to really commercialize and at scale, the sodium battery. That announcement was made, I think, a month ago or something like that. When you dig into the details there, they cannot make a whole battery pack for a car with sodium cells. There are still many lithium ion cells, right? Because remember, a pack, the modules, the packs, we get, like, many cells pressed together, so we can't get the energy density a car requires with just sodium cells. We can swap in some of the lithium cells for sodium and maintain decent energy density.So that just goes to show two things at once. One is that substitution is possible. But two is that we're not at a point where we have full substitution and we just get rid of the lithium altogether. So that's one thing to keep in mind. I think there's a bigger—I don't want to say philosophical, it's probably not the right word—but just like a deeper question here, which is I've used the word silver bullet already. I think that regardless of what the raw materials are and their specific impacts, and it might be true that sodium has less impact on lithium, and I'm absolutely willing to agree that there would be a set of materials that, for some reasons, involve less environmental impact when they're mined or they're more efficiently used or something other, right.I'm also a big believer in making the batteries more efficient with the raw materials that they use, right? Getting more out of less, right. So I'm a believer in all of those things. But what I'm not a believer in is this idea that we can just escape the dilemma of resource extraction just by technological innovation. Right, this kind of sci-fi idea...I like the sci-fi that's more realistic, where extraction is there. Like, if we look at "The Expanse," these kinds of shows that show these problems with extraction still exist in the future or in other landscapes, right?I don't like the sci-fi idea that we just escape our earthly impact and presence.David RobertsWell, you build a blue light arc reactor, and it just hums and pumps out energy. Right?Thea RiofrancosAnd, yes, maybe certain things we can be totally synthetic, or we just...I don't know. But even with, like, hydrogen, you just had your newsletter about that. In the way that we are producing all of these climate technologies, there are going to be earthly impacts, there are going to be extractive requirements, and our goal is always to be more resource efficient, regardless of what the substrate of resources is.David RobertsRight. And this is kind of the main point I want to make about this whole report and this whole sort of subject matter, which is: it's not like we should improve material efficiency because it'll reduce our mining impact on the environment, but there are countervailing considerations. There really aren't any countering considerations.Thea RiofrancosIt's all good to do that.David RobertsIt's better for people. It's better for decarbonization, it's better for our physical and mental health. It's better for, literally the financial health of cities. Like you just go down the list. One of the things I think is most exciting about this report is it is an explicit attempt to get climate advocates, global justice advocates, and urbanist, city advocates on the same damn page, pulling in the same direction, working with one another toward the common vision. And I've just thought that that is like, sort of implicit, but it's like, you don't see it translating into efficacious organizing.Like, you don't see those groups really working together as much as you want. So how much of this report was just had that in mind? And is that too utopian? Do you think that's a doable thing to get these interests on each other's team?Thea RiofrancosThere are two motivations of this report in terms of its origin, like, why we decided to do it. One is, back when I was first in Chile researching lithium in early 2019, I learned about the impacts, I learned about the protests, the concerns, et cetera. And I started to think, like, is there a way maybe not to eliminate lithium, but at least to reduce the stress on landscapes and to reduce the volume required? And I was reading these alarming forecasts at that point, and I thought, "Oh, there must be a study that shows that there are more and less lithium intensive ways to decarbonize transportation."Like, I booked that up on Google Scholar and I tried like, 30 different keywords, and there was no such study. And then I asked every expert that I interviewed who was expert on transportation, battery tech, whatever this question, and they said, "Oh, that study doesn't exist. It would be useful, though, just to know."David RobertsIt's kind of telling how utterly hegemonic the kind of car centric view is. It doesn't even occur to people.Thea RiofrancosIt's not an askable question.David RobertsYeah, people don't even ask the question.Thea RiofrancosSo that was one origin point to this. I just wanted this data so that when I presented my work on lithium and the political economy of it, the contention when people ask me, like, is there another way I could say something other than, "well, logically, if we had more mass transit, we'd need less" just if-so facto or whatever. So I could just say something with data. So that's one origin point. But there's another origin point that's equally important, which is I participate as a researcher, as an advocate, as a think tank person, and wearing different hats, like, in a variety of coalitional spaces with some of the people you just mentioned, but not with all of them at once often.So that's important, right? I think that that full spread has not quite happened yet in terms of building coalitions and constituencies that are speaking to one another. But there is some of each in a variety of political spaces. And I find that there are tension points and...this not a novel observation at all, actually. Much ink has been spilled on this. Like, is it totally impossible to decarbonize without harming indigenous rights? These stories have been written. These analyses and thought pieces have been written, but they're not just like, takes. They're also like, real people trying to work through real problems and not always having the data or policy tools that would kind of show a different way forward. And so aligning those, not perfectly, because I do think there's different ideologies, there's different personalities, like, you can't make everyone agree perfectly...but at least showing that these are not as fundamentally at odds as they seem. If we envision a little bit more broadly and creatively like what the energy transition might look like.David RobertsYes, and just do the sort of grown-up thing of explicitly acknowledging that we have multiple goals, some of which are in some tension of each other, and the best we can do is to balance them as best we can and try to pull in a direction that serves all of them at least somewhat, right? Like an adult way of making decisions not characteristic of our society necessarily. Thank you for coming on and talking through this. I mean, there's so much in this report. I feel like any chunk of this report, we could do a whole pot on it. A whole thing on lithium, a whole thing on transportation, a whole thing on justice, and everything else, but I do think it's for just those reasons you said there in your last answer, like, this is much needed and much overdue. So thanks for doing it and thanks for coming on.Thea RiofrancosThanks so much. This was a great conversation.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

How can electric school buses be made accessible and cost-effective? In this episode, Highland Electric Fleets CEO Duncan McIntyre makes the case for why school districts should overcome the challenges to bus electrification, and the ways his company’s subscription model helps them do so.(PDF transcript)(Active transcript)Text transcript:David RobertsOne of my very favorite things in the world to talk about — second perhaps only to electric postal vehicles — is electric school buses. It's difficult to think of a more righteous cause than reducing air and noise pollution in direct proximity to the country's most sensitive lungs and ears.Currently, however, electric school buses still cost two to three times what their diesel competitors cost, which can be daunting for school districts with tight budgets. Electric buses pay themselves off over time through dramatically lower fuel and maintenance costs, but the upfront costs of the transition are steep enough to scare away many administrators.My guest today runs a company called Highland Electric Fleets that is attempting to overcome that challenge by offering a new business model. Rather than purchase and maintain the buses themselves, school districts pay Highland a subscription fee, locked in for a 15-year contract, which covers the buses, a depot, charging infrastructure, scheduling, training, and ongoing maintenance and replacement of buses when required.In addition to a saving most school districts money immediately, the subscription contract derisks the transition to electric buses. That is about the best thing I can think of that someone could be doing these days, so I was eager to talk to Highland CEO Duncan McIntyre about the advantages of electric buses, the challenges school districts face, and the problems solved by the subscription model.Alright, with no further ado, Duncan McIntyre, welcome to Volts. Thank you for coming.Duncan McIntyreDavid, thanks for having me.David RobertsThis is awesome. Volts listeners are so interested in electric school buses, so I just have a gazillion questions, so let's jump right into it. Tell us, what are the advantages or benefits of an electric school bus over the current line of school buses, which as I understand it, are mostly diesel?Duncan McIntyreThat's right, they're mostly diesel. A little over 80% today. But your question is about the advantages of electric. I think the list is long, but I would highlight a few of the big ones. There's a clear benefit in emissions profile just in the health of everyone who's operating or riding a bus. There's no tailpipe at all, and as a result, they're very clean. Another big advantage is they just operate much cheaper. The fuel is a lot less expensive, there are very few moving parts compared to a diesel bus, and as a result, there's no oil changes, there's no exhaust filters. There's lots of things that just aren't on electric buses, and so operating is much less expensive.David RobertsAnd I don't want to get caught up in the whole thing too early, but I'm trying to sort of conceive of the sort of magnitude of the pollution reductions here. Like, have there been measurements or studies about the difference when an electric school bus replaces a diesel bus? Or are we too early to know for sure about that kind of stuff?Duncan McIntyreI think there have been plenty of studies about the health impacts of a diesel bus. And the comparison is simply the health impacts of not having a diesel bus since the electric format has literally no tailpipe and no emissions profile at all. But the health studies have been done by groups like American Lung Association, groups like that, and there's quite a few data points that look at reduction in NOx and particulate matter, specifically on things like pediatric asthma. I would say that's one of the main studies that has taken place, but also tying the emissions associated with the diesel tailpipe to just other general health key indicators.David RobertsYeah, one thing I would toss out too, because people always forget about this, but is noise pollution, which is the research on noise pollution is wild. I don't think people appreciate the effect that has. And all these kids are effectively sitting right next to a jet engine, more or less. It's extremely loud. But the first question that comes up for everybody is they cost more. So what is the current cost differential between an electric school bus and a diesel school bus?Duncan McIntyreThe electric school bus ranges from $275,000 to $375,000, really, depending on the state you're in. And your question is about the differential. It's about $200,000 of differential on average. So it's a $200,000 premium to buy an electric.David RobertsThat's not small. That's two or three x the cost.Duncan McIntyreThat's exactly right. It's not small.David RobertsLet's also talk about some of the other barriers other than cost for a school district looking... if I'm in a school district, I have this wild idea I want to replace all our diesel buses with electric buses. The cost of the buses themselves is not the only barrier or challenge I face. What are the other extra challenges that have to be overcome?Duncan McIntyreThere's a few other buckets. One would be charging infrastructure. You need to establish your depot wherever you operate your buses today as an electrified depot. And that involves installing a whole bunch of new equipment, running an interconnection to bring new power, new electrical service into that depot. I'd say that's one big bucket of sort of a project that's required to get up and running. There's another piece that's all about training. Your workforce needs to be trained. Mechanics need to figure out how to work on these vehicles. Your drivers need to know how to operate them and how to not just operate them, but how to be really comfortable with running them.And then there's an operating cadence of charging them. The fueling activity is a little bit different. And unlike diesel fuel, with electricity, you really want to pick and choose when you charge and how quickly you charge, as it can result in lower or higher costs and more reliability if done right.David RobertsAnd so that'll get into logistics, right? Like routes and the timing of routes and these kind of things?Duncan McIntyreAbsolutely, that's right.David RobertsAnd so these are all fairly substantial challenges. So what is the current market penetration here? What is the base we're starting from? Are electric school buses anywhere, or is it still an extremely marginal sort of market?Duncan McIntyreWe're at an inflection point right now, David. If you'd asked me the question a year ago, I might have said electric buses made up 2% of the new school buses purchased in 2022. But in 2023, our perspective is it'll be closer to 10% of the new school buses purchased, and in 2024 will be 20% to 40% of the new school buses purchased. So it's changing very quickly right now.David RobertsYou think we're on the upswing of that s-curve in adoption?Duncan McIntyreWe are. There's lots of reasons behind that. The federal government, as well as many states have launched programs that are putting a lot of fresh grant capital as well as tax credits.David RobertsIf I'm a school district now, what is the total kind of pool of assistance available to me? I think there's some stuff in IRA. I think there was some stuff in the infrastructure bill. I know there's state stuff. What is the sort of menu of assistance I can find?Duncan McIntyreYeah, it's a tidal wave of assistance, David. It takes a full-time person just to navigate it all. But I would put it into a handful of big categories. One is the Clean School Bus Act, which is part of the infrastructure bill, and that's $5 billion that will roll out over five years.David RobertsAnd are those just grants to buy school buses?Duncan McIntyreEssentially just grants to assist in buying electric school buses. I think the second big category is tax credits in the IRA. And the tax credit is not as big on an individual vehicle basis, but importantly, it can be bundled with other grants and so it provides support. And then many states have their own programs. California has had a program for years that's robust, really a grant program. Colorado has a new grant program. There are funding mechanisms everywhere from New York to Maryland to Virginia. And in many states, the totality of bundling a state program with a federal grant program and a tax credit actually make an electric school bus much less expensive than buying a new diesel, so there's a real cost advantage in some parts of the US today.David RobertsGot it. So we're not just talking assistance. We're talking sufficient assistance at this point.Duncan McIntyreMore than sufficient assistance, we would argue.David RobertsRight. Okay, so we've got a school district that has a dream of switching out fleets, but it is daunted by the individual cost differential of the buses. It is daunted by this notion of infrastructure and how to build it and where to build it and how to run it. It's daunted by, basically, being busy and not knowing... not having time to study how to switch sort of the logistics of the fleet and the dispatching everything. So into this environment comes Highland. What is your business model? How are you trying to address those barriers?Duncan McIntyreYou've laid out the barriers quite well. The Highland business model is the finance engine behind driving the electric school bus movement. What we found is that while capital, upfront capital is a huge barrier, accessing the grants can help bridge that gap. But it's complex. And on top of that, if you've got the grant money, it's still very difficult to figure out how to design the equipment, build it on time, build it reliably, and then ensure that you can operate, reliably and within your budget. And so, our business model is truly the finance engine. We pay for everything that's not grant-funded from vehicles to equipment, and then we commit to operate that equipment and really support our customers—support the schools—by promising their fleet of electric buses will be fully fueled every morning for 15 years.David Roberts15 years. So just to make sure I have this right, the school district pays basically a subscription fee to you, to Highland, and Highland buys the buses, builds the chargers, builds the depot and trains staff, and then maintains, but does everything else, maintains the vehicles, repairs the vehicles if they needed or replaces them. Everything else, Highland does. So the only thing that the school district is on the hook for is a subscription fee, is that right?Duncan McIntyreFrom a financial standpoint, that is exactly right. And from a practical standpoint, you're spot on. The only nuance would be vehicles are often maintained by the district's mechanics. So we will train them and then we will pay for the maintenance. So the staff that's on the ground today is typically very well-suited to actually do the repair work, and they're eager to get the training and be part of this new industry.David RobertsSo financially, the school district can be confident that the subscription payment is the totality. There's not other things that they haven't thought of. They're going to come and post costs on them.Duncan McIntyreThat's exactly right, yeah. The school district knows it's predictable and reliable that our subscription fee is on par or less than what they spend to put a diesel fleet on the road.David RobertsI'd like to get into a little bit of detail about that. So it seems like just financially, just comparing the cost is complicated. So I assume you've done this math and you've worked through this with some school districts. So what is the kind of cost of a subscription? And how does that compare to... if I'm a school district with a fleet of diesel school buses, the cost of switching the buses, building the infrastructure, training, maintenance, et cetera, et cetera, how does the total cost shake out?Duncan McIntyreYeah, that really is one of the key drivers behind this industry.David RobertsI'm sure it's everyone's first question when you approach them.Duncan McIntyreTotally. And in terms of your listeners, David, I would imagine solar is a good analogy. The reasons why companies like Sunrun have done so well is because the average homeowner doesn't necessarily know that if they spend $25,000 on solar equipment, they don't know what they're going to get in return. And so a developer can take on the risks, place the capital, build the equipment and promise that the equipment will work. And the result is the homeowner pays ten cents a kilowatt hour and they know that's cheaper than the utility. We sort of do the same thing. We know what the capital costs are going to stack up to be on any given project. And they differ depending on the state that we're in. Illinois is different from Maryland.David RobertsWell, size of the school district, too. I mean, presumably these bus fleets range quite widely in size and scope, like geographical scope.Duncan McIntyreAbsolutely, that's right. But we know what the cost is to build and then we have our own perspective on what the ongoing operating costs will be. Electricity to fill the buses every night, the software we need to run it, all the costs. And then the third big piece is we know what the grants look like and we need to organize our deployments so that upfront costs and downstream costs match up and that can result in a very affordable rate that the school district can pay us under our subscription. But embedded in that is the risk that the equipment will perform and the risk of commodity prices.David RobertsRight.Duncan McIntyreAnd the risk of keeping the fleet maintained and running. And so it lends itself very well to a business like Highland where we have the scale to bring specialized teams to do all those things really well and deliver it as a bundle.David RobertsRight. So presumably the total cost of owning and maintaining the fleet for you is going to be somewhat lower than it would be for the school district just because you have the procedures and the staff and the expertise and the relationships with vendors, et cetera, et cetera.Duncan McIntyreThat's exactly right. There's economies of scale around every corner, and we're the largest buyer of electric school buses in the country today. We've got more of them on the road than anyone else. And as a result, we have scale in our operations that others don't have.David RobertsAnd so this subscription fee is locked in place for 15 years?Duncan McIntyreThat's correct.David RobertsThat's part of the guarantee. Like, you will pay X amount each year for 15 years no matter what happens to the cost of electricity or more supply chain problems or whatever else.Duncan McIntyreThat's exactly right. And it's more like per mile, $2.50 a mile might be a contract we would sign, and we know they're going to be driving that bus about 10,000 miles a year, but it could be a little more. It could be a little less.David RobertsRight. So a lot of risk you're taking on a lot of risk cost. So can you guarantee—I'm sure you don't want to guarantee because there are lots of different kinds of fleets and a lot of different kinds of places. But, can you come close to guaranteeing a given school district that the subscription fee they would pay you is lower total cost than going electric on their own? Is that something you can sort of set in stone?Duncan McIntyreWell, the school would have to go through the details and come to the conclusion on their own. But in almost every case, we found that we are cheaper than them doing this on their own. And I would highlight a couple of reasons why. One is simply we're a larger buyer than they are individually and that gives us access to better pricing from all the equipment providers. A second reason is we have invested in all of the technology needed. That creates interoperability between the charging stations, the vehicles, the utility, and the software management tools. And so we can roll that out very inexpensively at scale.And a third reason is there's a tax credit out there that has a lot more value in it for a private tax-paying entity that's structured in a way to monetize it. It's the same reason why most solar is privately owned as opposed to publicly owned. It's because there's tax credits that are tricky to monetize otherwise. And so there's a chunk of cash that we take off the top just for the tax credits that schools aren't aren't able to sort out very easily.David RobertsSo that's one financial question: is it cheaper than doing this ourselves? But maybe the more difficult financial question is: could you go to a school district and say over the course of the 15 years of the contract, this will be cheaper than continuing to maintain your existing diesel fleet? Can you promise that?Duncan McIntyreI can't promise that because we don't know what diesel fuel prices will be two years from now. But we can make a very strong case that we will indeed be cheaper by quite a bit. It requires everyone to agree on some assumptions around diesel fuel pricing. But we have one other benefit, which is: not only are we typically cheaper when you model it out, but we have no fluctuating costs to the school.David RobertsYes.Duncan McIntyreAnd so that's a benefit. It's a big benefit.David RobertsYeah, this is such a big benefit of renewable energy that I feel like manifests in a lot of different areas that gets overlooked a lot of the time. Just risk of commodity price fluctuations is such a huge factor in these financial transactions, such a huge factor in national inflation risk. It's like a huge factor in everything.Duncan McIntyreI totally agree. And the reality, David, is we can lock in electricity prices for many years into the future by going into the competitive electricity markets. And that's a lot more difficult to do with diesel fuel, unless you want to pay a big risk premium. And so not only is are the kilowatt hours much cheaper, which just makes the totality of fueling costs lower, but electricity has more management tools for companies like ours to go into the markets and really lock in those prices. So we aren't taking twelve years of completely naked risk either. We're just bringing a set of strategies to bear to offer that to our customers.David RobertsSo you can make a strong case that it will be cheaper over the 15 years. What about though, like, next year? If I'm a school district and I have sort of a set school bus budget, can I save money on the first year? Because it's always these upfront—as I'm sure you will know, it's always these upfront costs that are daunting to people and keep people away from these things—is there immediate savings or is it comparable immediately?Duncan McIntyreYeah, there's immediate savings, especially in the environment we live in today, where there are some grants available to support project costs. And so year one, year two, year three, there's immediate savings and there's also just a huge savings in the first year because you avoid buying a new diesel bus. So you might avoid spending $140,000 for a capital purchase. And you've gone to a world where Highland gets paid $30,000 a year, which includes a vehicle, it includes all the fuel, it includes repair costs, it includes software and training. So there's cost savings day one and there's a very strong case that there will always be cost savings.David RobertsSo this is a naive question, but you're coming to school districts and saying, "Hey, a. you're going to save money on day one, b. you're going to improve the health of your kids and your drivers, c. you're going to improve general sort of satisfaction and performance." Who says no to this? And why? Does anyone say no to this?Duncan McIntyreI ask myself the same question occasionally. It's almost too good to be true. We're at a moment in time where the technology is ready for the task and there's a combination of available services and capital and those are coming together in a really nice way. But what we're doing, David, is still asking municipalities to buy transportation in a different way. They're accustomed to a capital budget to buy vehicles and an operating budget to run them, and we're asking them to blend them into a subscription. So there is a little bit of a new dynamic, a new purchasing dynamic, and then I would say there's always concern about new technology and we're still in the early innings of the electric school bus movement.And so there's, I think, a healthy element of skepticism around, "Will they be reliable?" And so, those are some of the obstacles that we run into. But I would say we very rarely get a flat out no. It's more... we just get folks who need to come up to speed. They're on their own educational journey and they need to kick the tires. And so we host a school district almost daily at one of our sites, whether it's Maryland or Colorado or Massachusetts, we're hosting a lot of visitors expressing interest, and they're in various places on their buying journey.David RobertsWhat about, god forbid, the risk that Highland goes out of business at some point in the next 15 years? What happens then to these contracts?Duncan McIntyreIt's a good question. The vehicles are still there and the vehicles will still be operated and the contracts stand independently. We set every contract up in its own entity and we fund each individual entity in a way that's appropriate to capitalize the project. If you think about a project, the risk that we go under is really only for the couple of months at the very beginning when we're building and delivering. Once we've installed all of our equipment at a customer site and we've delivered all the vehicles, the project entity that we own, but the project entity that serves the customer, is simply basically producing profit that goes to pay back the investment. But if Highland were to go under, that project entity will still stand and serve the contract until the end of the contract.David RobertsGot it. So the the maintenance and operations side of things is locked in for the 15-year contract, regardless of Highland's fate.Duncan McIntyreThat's a good way to think about it. That's exactly right. And so there's a lot of details behind how that works, but every one of our customers asks the same question you ask, and they get very comfortable because of that dynamic.David RobertsRight. So as I'm envisioning the country's school districts, the first thing that comes to mind is just wild variety of size, of financial wherewithal, the number of buses, the geographical scope of the buses, the weather conditions in which buses operate. So how standardized can you get this? It seems like there's this element that's bespoke to every school district that's sort of unavoidable. How similar is what you do from district to district and how much is it kind of customized?Duncan McIntyreThere's a few things to unpack there. There's a component around the environment that the project is asked to operate in. So whether it be the average temperature by week per year, the topography, are they going up steep hills and down, or is it flat? How many stops? All that stuff gets, gets boiled down to the sort of the operating plans and we build our charging infrastructure and size the batteries. And every aspect of a project design depends on those key assumptions. But we have done this everywhere from scrubbing data from a project in Tok, Alaska, which is arguably the coldest electric school bus in operation.David RobertsYeah, I was going to ask, I mean, everybody, as you can imagine, everybody on Twitter everywhere else, one of their first questions is, "What about cold weather? What about when it's freezing? Blah, blah, blah. What about... don't EVs lose range? How do you keep the buses heated when you pick up your first kid?" All these questions about cold weather. So you've dealt with those.Duncan McIntyreYeah, the answer is, it's actually not that complicated. It's just about planning. I'm sitting here in Beverly, Massachusetts, at our headquarters. I'm looking out the window, and we're getting dumped on by snow right now, and the buses are out picking kids up. And it's fine. You do lose a little range. It's better to precondition the batteries and the cabins of the vehicles with some heat before you unplug them. So the vehicles go out pre-warmed with a full tank of gas, so to speak. But that's sort of a segment of your question.The broader question is, can you standardize a product offering here? And the answer is, absolutely. That's what we've been working on for the better part of five years. Every project has expertise needed in designing and building a depot. And so you've got parameters that you need to solve for that include topography, temperature, range. You've got people who need to be trained. You have investments that need to be made, and you have a utility that you have to interact with, and you have to put all those things through a standardized process so that you deliver reliable, affordable transportation at the end of the day.David RobertsYou've not run across a school bus route that is too long or too far to do with electric like...?Duncan McIntyreWe have. We've run into a few, but they're very rare. We serve both very rural and very urban customers. In Illinois, we have a contract that's in a very rural part of the state, and the routes are over 100 miles. That's entirely doable, as long as you plan your charging equipment appropriately. But occasionally we see 150, 160, 170-mile day, and the driver doesn't have the time to circle back. And so those are some of the routes that are less appropriate for electric today, but it's less than 5% of the routes.David RobertsWhat is the range of an electric school bus?Duncan McIntyreWith the products that are available today, between 100 and 160 miles. Most of the buses we have on the road today have 140 miles of range.David RobertsAnd should we assume that that's being steadily improved like everything else? I was going to ask about this later, but let's get into it now. Just about the sort of manufacturing of the buses themselves. I'm presuming that among all the many other things you're doing, you're not manufacturing school buses. Where are you getting them and are you ordering? I mean, is there like a standard offering that you're just buying in bulk from some manufacturer, or is it possible to customize them? And if so, how much? Like, in terms of the physical buses and how you procure them, how does that work?Duncan McIntyreWe do not manufacture buses. You are correct. We buy them from the top tier manufacturers that have electric products available. Thomas Built Buses. We buy from Bluebird, we buy from IC, all of the major US-domestic manufacturers that have electric product available. We essentially buy one of two or three formats. There's a type C, there's a type D, which is a little bigger but a shorter wheelbase, and a type A, which is a smaller bus. And while there's lots of bells and whistles, you can add safety features, those can all be specced by each individual school.It is fundamentally the same foundational vehicle, just with more cameras or seatbelts or whatever someone might add on. So we do buy, in bulk, for a couple of those categories as part of our procurement strategy. And so we end up working really closely with the manufacturers, not only in terms of the features we need to operate the vehicles efficiently, but also the feedback loop. What are the things we found that are tricky for drivers? Little quirks?David RobertsYeah, I'm very curious about those people who have road tested these things now and there's... driving school bus routes every single day is a real stress test.Duncan McIntyreIt really is.David RobertsWhat do they find in terms not just of like, drivetrain or whatever, but sort of those bells and whistles? What do they and do they not want in those terms?Duncan McIntyreWell, first, I would say the drivers, almost universally, absolutely love them.David RobertsThis is for the same reason that everyone loves it when they switch to an EV, presumably?Duncan McIntyreIt's a lot of the same reasons, right? The vehicles have better torque. They're completely silent. The braking is a real pleasure. You really just take your foot off the accelerator and a regenerative braking system slows the vehicle down at an even pace. It's a very calming experience, and it puts more power back in the batteries while it does that. And so it takes a little bit of training and a little bit of practice to get the hang of it. But the drivers love it and it eliminates the wear and tear on the brakes. But I would say, David, the biggest highlight I would throw out there is because the vehicle is so quiet, no engine rumbling, the kids in the back don't have to yell over the engine rumbling to talk to each other, and so it's just a quieter drive to school, the whole experience.David RobertsYes. My memories of school buses in my youth definitely involve a lot of noise, a lot of screaming.Duncan McIntyreAbsolutely. And I would throw out one other just anecdote, which is while the drivers absolutely love the vehicles, there's lots of little quirks that we found, especially in the first couple of years of operating— fewer and fewer today—but little software quirks where if your bus is Idling for more than a minute, it will shut off in the early iterations. So you have to flip the switch and turn it back on. And since there's no engine rumbling, you don't know that it's shut off. And so that was a little inconvenience that had to be sorted out with the manufacturers. But little things like that are pieces of feedback that were, I would say, weekly, monthly for the first year and a half, and now it's more like quarterly.David RobertsAlso in terms of the physical buses... in the EV space, there's this sort of division between sort of legacy manufacturers that are trying to move to EVs. And the thought is among, some people I think probably fewer people these days than before, but the thought is among some people that a company like Tesla, which is just starting on EVs from the beginning and designing an EV from the ground up rather than trying to sort of adapt old existing chassis and things like that, is going to produce, ultimately a better vehicle that in the long term will be cheaper. Is there a Tesla of school buses or of buses generally, or are these all legacy manufacturers?Duncan McIntyreLion Electric is a Canadian company that's the closest to what you described in this sector, and they were the first manufacturer to put an electric school bus on the road a number of years ago. They've had a lot of success in California, and they've got the lion's share of the market in Canada. And they're focused on other areas too, other categories of medium and heavy duty, municipal and other transportation, trucking and busing. And they are very... Lion is a very formidable competitor for the incumbent OEMs. I think one of the areas that is really unique to school busing is there's a very tight relationships with the regional dealers, not only on buying the vehicles, but just the ongoing support that's needed to keep them on the road. And, I think it's an area that is harder to break through that network without your own. Whereas Tesla had the benefit of consumers not having quite as tight of a relationship with their dealers.David RobertsEven loathing their dealers.Duncan McIntyreYeah, that's right. In many cases, I think that's right.David RobertsFinal hardware question: what kind of batteries do these buses use? Are they all using LFP batteries?Duncan McIntyreThere's a few technologies, but they're for the most part lithium-ion batteries.David RobertsAnd this is not like do you not get parents or school administrators worrying about battery fires? I mean, I know they're rare, but obviously—in this setting—you wouldn't want to take any chances.Duncan McIntyreI agree. That has not been a key area of concern for parents or school administrators. We do get the question occasionally, but it hasn't been a key area of concern. We own a lot of Thomas Joulies, which is the Thomas-built electric school bus, and they are powered by a powertrain built by Proterra. Proterra is a domestic manufacturer. They make batteries specifically engineered for the medium- and heavy-duty transportation sector. And the safety requirements and standards in that category of vehicle are such that Proterra had to do a tremendous amount of safety work. And they are one provider. Cummins has a platform as well.There are others, but our opinion is the industry has done a pretty good job of designing, you know, the right safety precautions and designing their equipment in the right way just to make them really safe.David RobertsYeah. Okay, there's a whole set of questions I want to ask about utilities and your interaction with them.Duncan McIntyreSure.David RobertsPutting aside for now, fancy talking to the grid and all this kind of stuff just in terms of going into a utility area and installing what amounts to really substantial new load and not only substantial new load, but load that when it's running full out, is a really high level of power involved. I just am assuming that you have to tell utilities, ask utilities, interact with utilities in some way just if you're going to show up and do this. Is that accurate?Duncan McIntyreYes, that's accurate. David, I would say it's somewhere in between ask and tell because the reality is the utilities, distribution utilities have a mission which is to serve the public with electrical service wherever needed. You don't build a new hospital and the utility doesn't say, "Sorry, you can't do it", right? It just comes down to timeline and cost. And so, we do need a ton of power. We have five sites right around Washington DC and Maryland. And each site has a five megawatt interconnection foot charge, electric school buses, so do 25 megawatts in a very small geographic footprint.David RobertsI mean, so that that's like grids are going to have to plan around that. I'm like, I'm curious if you've ever gone to an area where the utility says, like, "We would love to help you with this, but right now we just don't have the infrastructure, we don't have the lines, we don't have the ability to accommodate this much new power." Have you ever run into that?Duncan McIntyreWe have. And a couple of quick thoughts. The first is: it's always possible it just comes down to timeline and cost. And so it's an exercise in doing our homework, right? So we do all the work. I would advise anyone before you talk to your utility, you do your homework. What does the distribution feeder have available on it? Like what's the amount of power you can draw today? This is available information that can be looked up. Then it's about figuring out how difficult it would be to upgrade the service if it truly needed to be upgraded, how many miles of three phase have to be run from the nearest point of connection.And then, it's looking at the landscape, and that is everything from the existing rate tariffs to the Public Utility Commission to the politicians. And there's more and more support in more places for electrifying fleets, electrifying everything from passenger cars to garbage trucks, right? And so the political will is there to support investment, rate-baseable investment, in EV infrastructure. And it's about threading the needle between all those dynamics and coming up with a plan. There are places where we want three megawatts of power, but we'll settle for 1.5, because we can get 1.5 in a year, and we can work on the next 1.5 over the next four years, and plug the gap with some stationary storage or some other form of a charging strategy.And so, I would argue it's really about interacting with the right people at the utility to come up with a plan that leverages the utility's assets and capabilities with the needs of the fleet, and it gets married up by the equipment that's available to sit in the middle.David RobertsYeah. Have you run into a situation yet where you had to wait? Where you had like, people ready to sign contracts, but you had to wait for years, two years, three years, four years, whatever, to let the utility prepare?Duncan McIntyreWe signed our contract with Montgomery County Public Schools in February of 2021, and we promised to have the first depot up and running in August that summer, which is lightning fast, but we promised to have three more depots up and running 18 months later because we knew they were going to be slower. And then we didn't promise to have the fifth depot up and running until the summer of 2024. So we knew that one would take three years and it will take us three years. We're in the middle of it now. And that was exactly a function of those local dynamics, how to get the power, how to get it efficiently, how to get it affordably, and how to work with the utility to do that.David RobertsYeah, I don't know that I would want to be in a business where I'm waiting on utilities to do anything as a general matter.Duncan McIntyreIt's an inevitability here. But once you're up and running... first of all, for the most part, utilities have been pretty darn good partners. Everyone has this in their roadmap, and so more often than not, they're kind of excited when someone comes and says, "Hey, we've got a real project, let's work on it together."David RobertsBeyond just the basics. Once you have a fleet of electric school buses, you have a distributed set of very large batteries which are sitting unused most hours of the day. So I guess two questions. One is about grid to vehicle communication, i.e. do you time the charging of these vehicles in coordination with the utility in some way?Duncan McIntyreSo I heard two things there.David RobertsWell, the first is time-to-charging, which I think of as sort of grid communicating with vehicles. And then the second is vehicle-to-grid, which is vehicles occasionally discharging electricity into the grid when the grid needs it. My sense from talking to people in this space is that just timing you're charging is relatively easy. First step in that vehicle to grid communication is a little bit more complicated and is not all utilities are ready for it but just sort of tell me like to what extent are you getting into grid services?Duncan McIntyreWe are absolutely doing both and you're correct that simply timing your charging we view as table stakes. You sort of need to be doing that to run an efficient operation. I would say that we coordinate that with the utilities a little bit. But the utilities don't get deeply involved in interacting with customers on topics like that today. What they do is they push out programs. They say, "We have a time-use rate tariff." You, customer, choose if you want to change your charging schedule based on the rate tariff and so we are doing that very actively.The equipment that's available today it doesn't come fully ready to allow customer choice around charging times. You really have to do it in more of a manual way. We've had to build a software stack with all these controls to do it in a reliable format but I do think that's an area where the tech is getting better and better and if you do it right you will save 75% on your power costs.David RobertsNo joke. That's a lot.Duncan McIntyreIf you look in places like San Diego, if you charge at the wrong times, you'll trip demand charges. And without getting into all the details, your bill can skyrocket. And so charging is really important to get right because it just comes down to dollars and cents.David RobertsAnd so at this point, you have got software integrated into the buses such that the driver can just plug in whenever without worrying about it and the software does the timing?Duncan McIntyreThat's exactly right. The software allows us to control our charging times and our charging rates from our remote operating center. And the software creates that connective tissue between us and our equipment in the field and helps us to scale and helps us to assess fault codes earlier vehicle health, look at trends, collect data, but ultimately control charging in a very dynamic way.David RobertsAnd you feel like that's... you've got that relatively down?Duncan McIntyreWe've got that fully down. We do have a partner, it's a company called Synop, software company, and we've done a deeply integrated commercial partnership with them that's many, many, many years long and then on top of them we have our own systems and processes that effectively ensure that all the hardware speaks and allows the software to do its job. So it's a full tech stack of software and hardware and it's all got to be stitched together in the right ways to work smoothly.David RobertsInteresting. And so what about then vehicle-to-grid? I am assuming that that's rarer that there are only some utilities that can accommodate that. Are there any yet? Is that a real thing yet or is that still like a gleam in people's eye?Duncan McIntyreIt's a real thing but today it is binary in that either the utility has something you can do or it doesn't. And we have vehicle-to-grid up and running on about a third of our projects today. And in most of those cases, the vehicle-to-grid activity is in its simplest form, we're charging the buses full during the overnight hours in the summer, July and August, and we charge overnight because there's lots of power available. It's very inexpensive, and the grid has it available. And then late in the afternoons, the next day, from 3:00 to 6:00, 4:00 to 7:00, we will actually export all the power in the batteries from the buses back to the grid. And it's because the grid needs the power and they're willing to pay for it. And it's very lucrative and so helps drive down our cost to serve school districts.David RobertsYeah, when you say lucrative, I mean, compared to saving 75% on your charging costs, is it that lucrative? Like, where is it relative to just sort of timed-charging? Are you, are you making comparable money offering these grid services?Duncan McIntyreIt's more lucrative than simply saving. Just to put, you know, some round numbers around it, if you charge at the wrong time in San Diego, you could get a $5,000 utility bill for the month for one bus. If you charge in a smart way, that might be $1,000, right? A lot less expensive. Our vehicle-to-grid income on a per bus basis in parts of New England is $12,000 a year.David RobertsNo s**t.Duncan McIntyreYes.David RobertsThat's a lot!Duncan McIntyreNow, you have some equipment that you have to invest in to do it. So it's not all profit, but what it does is we pass dollar for dollar, we pass that money on to the school district, we underwrite to it as we invest in equipment to serve them, and then we operate the vehicle-to-grid program so that we can make it more affordable for schools. And I'm convinced that we're in the very early days, but in five years this will be happening in more places than it's not and will be a meaningful contributor to eating away at that $200,000 vehicle premium I described in your opening questions.David RobertsWell, also presumably, do you use that to lower I mean, is your subscription fee standard everywhere, or is it lower in some places than others based on grid circumstances?Duncan McIntyreYeah, our subscription fee is different for every opportunity. Each customer account might have different costs and different expenses, but we use that income to lower the subscription fee to the customer. And there are cases where the customer is saving 20-25% compared to their diesel fleet operation and the vehicle-to-grid is that extra savings.David RobertsInteresting. Vehicles-to-grid is one thing. There's also, of course, if you have this huge set of batteries, what about using them during blackouts for backup power for schools or community centers or things like that? Is that on your radar?Duncan McIntyreAbsolutely. As more and more electric school buses come online, they are increasingly becoming a source of resiliency for local communities. We call this vehicle-to-community. Very much describes the activity taking place. The buses have very energy-dense batteries, and they happen to be energy-dense batteries sitting on wheels. If you've got a community that has lost power, you may need to keep cold storage going at a local high school. You may need to give people the ability to charge cell phones. You may need to set up air conditioners...David RobertsHospitalsDuncan McIntyreAbsolutely. Hospitals. Absolutely. These vehicles can be anywhere in a community in a short amount of time, and they can deliver power into buildings if they've been set up with the right equipment.We're building out these capabilities for a number of our customers, and I actually think it's maybe one of the most exciting, most promising dynamics that is very much an untold story to date, but it's just really exciting to make an electrified fleet that much more of an asset to its community.David RobertsYeah, huge resiliency advantage there. Because people say that the new Ford F-150. People will tell you that can power a medium-sized suburban house fully for like three days on that battery. I don't think people appreciate how big these batteries are. And that's just one truck. I assume the battery on a bus is much bigger. So, this is not a small amount of dispatchable power you've got in your hands in the case of a blackout.Duncan McIntyreThat's exactly right. Our electrified site in Bethesda, Maryland, when it's fully operational, which is a couple more years, there'll be more vehicles arriving. But that site will be able to deliver five megawatts of power in a resiliency format for a period of a little more than 3 hours, or it can deliver half a megawatt for many, many days. That's a large hospital right there.David RobertsYeah. Wild. One other thing about utilities, before I forget, I was reading there was a battle in Virginia, I think, recently. I think it was Dominion. The utility wanted to get into owning electric school buses. Owning and operating. I think maybe more or less along the lines of what you guys are trying to do. Does that make any sense to you?Duncan McIntyreIt does. That's well-described and it's pretty accurate. Dominion launched a program a couple of years ago where they proposed owning electric school buses and the charging equipment and basically providing them to schools, public schools in Virginia. And they proposed rate-basing all of those investments so paid for on your electricity bill if you're a resident in the state of Virginia. And the case they made was that this is part of the electricity ecosystem, and with the batteries and the buses, we can deliver reliability services. There are varying formats of that being proposed at utilities all across the country.David RobertsInteresting.Duncan McIntyreBut in very, very few cases does the utility propose to actually rate base the bus. And so Dominion was challenged by policymakers in Virginia, and the policymakers ended up saying, "You cannot do this in any sort of longer term programmatic format." It may be that they're going to try again.David RobertsWas it just sort of like generalized hostility towards utilities? Or was there some specific reason why they thought it couldn't work?Duncan McIntyreI don't think so. I think the case was made that the vehicle itself is not something that the average electricity purchaser, the average homeowner should be paying for. That's not a fair expense to pass on to the ratepayer. It's something that should be passed on to the schools. Now, if the batteries have value and you can isolate the value to help balancing the system, then maybe that's an acceptable investment. But, I think Dominion was early on in this movement and I would expect comeback with a modified version of their plan that probably has a higher likelihood of success.David RobertsAnd that would be competition to you, would it not? Some of the same services?Duncan McIntyreIt is and it isn't. They would be providing equipment and agreeing to pay for some of that equipment, but that's not much different than a grant which just pays for some of the equipment. Dominion does not come with a suite of services to basically ensure the fleet gets built on time and operates reliably.David RobertsRight. They're not going to build a depot or repair school buses.Duncan McIntyreThat's right. And if your charging station doesn't work, are you going to call Dominion? You're not going to call Dominion. So I think businesses like ours have a natural ability to partner with utilities in any format that the utility shows up in. We can plug the gap with additional capital and with services that ultimately benefit reliability and cost certainty to schools.David RobertsOkay, so then let's wrap up maybe with a final kind of question or set of questions. So we've got the business model here available. It's advantageous for most school districts just on a pure cost basis, to say nothing of not pumping diesel fumes directly into kids lungs and deafening them with jet engines as they get to and from school. And I'm a parent in a school district and I am taken by this and want to advocate for it. Where do I go? To whom do I direct my strongly-worded email? What's the best way for people to try to organize and advocate for those?Duncan McIntyreI would send your email to three recipients and put them all on the same email. The first recipient is a board member, a member of the school board who is an advocate for this type of activity. The second individual would be a Chief Business Officer or an Assistant Superintendent, someone who's typically tasked with the operating side of the house and ultimately responsible for finance and contracts. And then the third would be the Transportation Director, whoever's running the current fleet. And what you do there is you get everyone on the same page. They all hear your message. A board member can be an advocate and push that message down, which often creates more willingness to take a deeper look faster. A business officer can get comfortable with the risk and the cost, and a transportation director can ground it all in the reality of: Will this work to pick kids up and drop them off back at home? And so that would be my advice, David.David RobertsThis seems like a great and very obvious step for school districts to take. Like, everybody, we needed to decarbonize, regardless. Kids' health is particularly important. This model overcomes the upfront cost barrier. But what if you receive pushback along the lines of the following: we're still early days in both electric school buses and in models like this, business models like this. And it's very likely that a few years of experience are going to scale a lot of things up, bring a lot of costs down, and that the subscription fee will likely be lower in three to five years than it is today. Why shouldn't we just wait until the market is more fully-baked?Duncan McIntyreThere's a decision that has to happen every single year to buy vehicles, to replace the oldest vehicles that effectively need to go to the scrapyard. If a school district has to buy ten new vehicles, they have an inflection point that is immediate.David RobertsRight.Duncan McIntyreThey can buy diesels or they can go electric, either on their own or with a model like Highland's model. And so it's less about "will the cost come down." Sure, the cost might come down for the ten we need to buy next year and the ten we need to buy the year after that and the year after that. But that doesn't change the fact that we have to buy ten vehicles right now.David RobertsRight.Duncan McIntyreAnd if it's cheaper, arguably cheaper, with a very, very strong argument to be made that it will always be cheaper, and it's definitively cheaper for the next five to seven years, then that tends to win the day with a business officer. And you really just have to get comfortable that the technology is ready to meet the routes and the reliability standards of your district. And there's enough projects out there at scale that we think prove that in a very strong way. But the last thing I would say is that's why Highland exists, because you don't own the vehicles. You, as the school district, are in a performance-based contract. And so Highland only gets paid if the vehicle operates by the mile. If the vehicle stops operating, there's an inconvenience, but the school is not out any capital or any additional money. And so we are truly incentivized as their partner to keep the fleet operating smoothly, fully fueled every day for a pretty long time.David RobertsRight. And it's in your financial interest to maximize performance with the lowest possible budget.Duncan McIntyreThat's right.David RobertsAll that sort of constant effort of looking for economies and looking for improvements and everything else, that's such a mental time load that is being offloaded.Duncan McIntyreWe agree. And David, it's not that the model is new to schools. It's new for school buses. But, schools have been buying energy efficiency equipment under energy savings contracts for decades. They're very accustomed to that business model within the operations of their plant, their facilities, and this is no different.David RobertsOne thing I always say about this model of subscription, rather than buying, and this is true across product categories is if you're just subscribing to your equipment. If a new, cooler, better school bus comes into the world, it's to Highland's advantage to buy it and switch it out. Unlike if you buy a diesel bus, you're just sort of stuck with the diesel bus for whatever it is, 10, 20, 30 years. You can see continuous improvements when you're on a subscription model. You don't have to buy every new model of bus. Someone else is going to do that for you. So you will likely see improvements in hardware and service over the course of the subscription.Duncan McIntyreThat's exactly right. And I would also say that our customers, if you speak with any of our customers, they would say that this whole experience is an upgrade. We give them better insights into their fleet. We provide a technology platform that is state-of-the-art and robust. They have better information than they've ever had on where the buses are located, state of charge, the health of the vehicle, lots of analytics and other tools. And when something goes wrong, we have people there and we're on the phone, and we're opening up power cabinets and solving problems very quickly. And the whole experience is, as you described, an upgrade.David RobertsWell, this is awesome. Volts listeners know that I have enormous enthusiasm for electrified postal vehicles and electrified school buses. Those are my two favorite things in the entire world to talk about. So I'm so thrilled, a. that you're out there doing what you're doing, and b. that you came on and took all this time with us. So thanks very much.Duncan McIntyreYeah, David, I love your podcast. I love what you're doing, and I was very glad that you're interested in hearing more from Highland about our experiences and what we're seeing in the market. So really appreciate you having us on and look forward to hearing it live. 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

In this episode, Raffi Garabedian, CEO of startup Electric Hydrogen, discusses all things electrolyzer, the current hydrogen market, and the future risks and opportunities for green hydrogen. (PDF transcript)(Active transcript)Text transcript:David RobertsVolts subscribers are likely well aware of the fact that a fully decarbonized energy system is going to require an enormous amount of hydrogen to fill in the gaps left by wind and solar. What's more, they are probably aware that hydrogen comes in a dazzling variety of colors, from blue to gray to brown, depending on the carbon intensity of the production.In the end, though, only one such color matters: green. That is to say, a fully decarbonized energy system is going to require lots and lots of hydrogen made with renewable energy, with no carbon emissions. The way to do that is to run water and electrical current through an electrolyzer, which splits the hydrogen off from the oxygen.Currently, about 95 percent of the world's hydrogen is made using fossil fuels. Green hydrogen — hydrogen made with renewable energy and electrolyzers — comprises only a sliver of the remaining 5 percent. Yet it’s going to have to scale up to 100 percent in the next several decades, even as demand for hydrogen rises.This is all a familiar story, at least to energy nerds. But if you're anything like me, the more you think about it, the more you realize that, despite the key role they play in that story, you don't actually know very much about electrolyzers themselves. What are they, exactly? What do they look like? How can they be improved? What policy is supporting them?To talk through these questions, I contacted Raffi Garabedian, the CEO of Electric Hydrogen, a startup that has set out to rapidly drive down the cost of green hydrogen. Garabedian, who was previously chief technology officer at First Solar, believes that the market for green hydrogen today is roughly where the solar market was in 2008, with all the attendant risks and opportunities.Garabedian (quite patiently) walked me through the basics of electrolyzers, the current state of the market and the technology, the kind of cost improvements he believes are possible within the next five years, the increasingly supportive policy environment, and the future of green hydrogen.With no further ado, Raffi Garabedian, welcome to Volts. Thank you so much for coming.Raffi GarabedianIt's great to be here, David.David RobertsI'm excited to talk today about electrolyzers because I think I am, and I think probably most of my listeners are already convinced that hydrogen is going to play an important role in a decarbonized electricity system. I think we can just assume that. And I already think, and I think my listeners probably already know this too, that in a true decarbonized system, it's going to have to be so called "green hydrogen," hydrogen made without greenhouse gases. I know there are 50 other colors made from different other things with varying levels of greenhouse gas production. But, I think—and obviously you think, since you've predicated your business on it—that we got to make green hydrogen work.And green hydrogen is hydrogen made with renewable electricity and electrolyzers. So, we know all that. But I find that when I think about the technologies involved, I have a pretty good understanding of all the pieces of that puzzle, except for electrolyzers. They're just kind of this thing that plugs into a certain spot in the diagram. But I find that when I actually focus in on it and think about it, I turn out to know very little about electrolyzers. So I'm very excited to have you on the pod today because I suspect I'm not the only one who has that sort of gap in my knowledge. So maybe we can just start with: what is an electrolyzer?Raffi GarabedianYeah, let's start there. Let's first start by just exploring and defining the problem that we're trying to solve, right? So we're trying to make hydrogen, which is both a feedstock and a fuel, and we're trying to make it using renewable energy. So how does that work? Well, it all starts with the water molecule. So everybody knows water is... what's the chemical formula for water? It's H2O. So think of that as oxidized hydrogen. Hydrogen, the word, actually is derived from hydro: water, gen: produces. So when you burn hydrogen yeah, interesting, right? When you burn hydrogen, you get water as a result.So burning is oxidation. So what an electrolyzer does is the opposite of that. It's the reverse of oxidation, which is called reduction. But it does so electrochemically. Now, what does that mean? Electrochemistry is a whole field of science and technology that involves the interaction between chemical reactions and electricity. And generally the kinds of electrochemical systems that are used in industry involve things like membranes and electrodes. But the function of these devices is to drive some sort of a chemical reaction that requires energy towards a desired end state. Now, in this case, what we're trying to do is drive water, which is burned hydrogen, oxidized hydrogen, back to its original state, right back to hydrogen's original state, which is H2, which is just the diatom of the element hydrogen.David RobertsYou're unoxidizing it.Raffi GarabedianYeah, you're unoxidizing it and and to do—you're unburning it. And to do so requires a tremendous amount of energy. That's because the reaction of hydrogen plus oxygen equals water, releases a lot of energy in the first place. It's, as they say, energetically downhill. So to go the other direction, we have to pump a lot of energy into it. Now, that's the good news. It's not bad news in this case. The good news is: we are able to store a lot of electrical energy as chemical potential energy in the form of hydrogen. And then we're able to extract that either as heat by literally burning it like you would any other fuel or through other mechanisms. For example, you can run hydrogen through a fuel cell and you can get electricity back out again round trip, just like a battery.David RobertsSo all that energy you're using to break up the water is effectively stored in the hydrogen, and you're getting all that energy back out when you...Raffi GarabedianYou got it. I've heard people say, "Oh, well, electrolysis is bad because it's so energy hungry." Well, that's exactly the point. It's energy hungry because you're trying to convert, transform that electrical energy from electrical potential into chemical potential, right? That's what an electrolyzer does. So an electrolyzer is the machine that does that, and it's generally got a bunch of parts to it. The heart of the machine is this thing called an electrochemical stack, typically. And that's a bunch of plates, layers of plates, and they're literally stacked on top of each other, which is why we use that term in the art.But you flow water through this thing, you pass electricity through it, and what comes out is oxygen on one side in one pipe and hydrogen on the other side in another pipe. It's got an anode and a cathode. And that's where you get the two gases are produced on either side of that cell. Now there's a bunch more to it. There's a power converter that delivers the electric power to the device and controls it. And then there's a bunch of piping, plumbing, valves, control systems, gas, water, separators, whole bunch of things wrapped around it, which we usually call like the balance of plant. Electrolyzers, historically... they've been around for a long time.David RobertsThe metal that the plates are made of is something reactive, right? Such that when you introduce electrical current to it and water to it, it causes the chemical reaction in question, like what do we have other than water and electricity?Raffi GarabedianRight. There are different technologies for electrolysis, but they all involve a thing called a catalystDavid RobertsRight.Raffi GarabedianAnd a catalyst is typically, in these cases, metals or metal oxides, which, well, like the word implies, catalyze the reaction. So they sit there, they don't get consumed, but they play a critical role in facilitating the reaction to occur. You can make water break into hydrogen and oxygen without a catalyst. Some of your listeners might remember high school chemistry class, right? You have like a little beaker of water. You put some stuff in the water to make it conduct electricity. You put two wires in it, connect it to a battery, and you see bubbles. Well, bubbles on one wire, oxygen. The other wire is hydrogen. And you can collect those gases. But that's a very inefficient way to electrolyze water. To electrolyze water efficiently, you need a very special kind of a catalyst. So those are the metals you're referring to. So they sit there, they're part of the construction of the device. They don't get consumed in the process, but they play a critical role in the process.David RobertsRight, so the catalyst is the same, whatever, after a year of production as it was at the beginning. This is not something that is breaking apart in any way or declining in any way.Raffi GarabedianWell, ideally, that's the case. Now, with any practical device, there are breakdown mechanisms, degradations, all sorts of practical things we technologists and scientists think about. And nothing works forever. Everything in the world breaks down. But, yeah, the first order, what you said is generally true. They're participants in the reaction, but they're not consumed in the process.David RobertsOkay, so you got these basic parts. What is the scale of this thing? Like, what is the smallest electrolyzer you could build? Or the biggest one? Or what is the typical one look like? Is it bigger than a breadbox? Like, what am I looking at if I'm looking at an electrolyzer?Raffi GarabedianYeah, let's go back in history a little bit, okay? So I think... forgive me, my dates are probably off a little bit, but I think the first electrolyzers were built in Norway, I believe. And they were built to utilize hydroelectricity to make hydrogen. And those were built using a technology called alkaline electrolysis, where caustic soda, or lye, is used as the working fluid, which is water-based. It's an aqueous solution. And those units are extremely physically large. Think of an object the size of a school bus, and they operate at pretty low power levels for their physical size.Think about something on the order of hundreds of kilowatts to a megawatt kind of scale for an object the size of a school bus. On the other extreme is this more advanced, I would say, technology called proton exchange membrane electrolysis. And that was invented... gee, I don't know the exact inventor, but I think it might have been Westinghouse back in the... fifties? And it was invented to make oxygen, interestingly, for submarines, for nuclear power subs. So these were relatively small devices operating in the kilowatts to 100 kilowatt regime, literally platinum- and gold-plated, super expensive things. They made it from submarines to the International Space Station to spaceflight again for oxygen.David RobertsAnd this is more like breadbox size.Raffi GarabedianYeah, that's right. But they've been adapted and have been scaled up over the years for the production of hydrogen. They typically go from, again, from that small scale breadbox scale to objects the size of a small refrigerator, shall we say, that could be as big as a megawatt in power capacity. So electrolyzers these days, the largest electrochemical stacks you can get are on that order, about a megawatt. They're physically very different in size depending on the technology.David RobertsSo it's not crazy to think that electrolyzers could be used in places where they need to sort of tuck into a relatively small space. Like, they vary widely in size. They could be made custom-sized for custom tasks.Raffi GarabedianYeah, they've been used industrially for years. They've been used in laboratory settings for years and years. They've been used for on-site production of extremely high purity hydrogen for things like semiconductor applications, for metal processing applications, whatnot. There's kind of a history of using these devices, but generally at relatively small scales. Now, when we think about the energy transition, which is the topic of your podcast and certainly my topic of interest, we are starting to now speak about a much, much different regime of scale.David RobertsRight. So this leads to my next question, which is: currently, I think it's 5%, something like that, of the world's hydrogen is made with electrolyzers. 95% still comes basically from fossil fuels. So those of us who are interested in decarbonization are expecting or asking this technology to scale up super big, super rapidly, relatively speaking, like this is like we're knocking on the door like, "Hey, can you like 2000 x in the next decade or whatever." So my question is just about... is the technology itself ready to scale up that big? Is it mature in the sense that efficiencies have been wrung out? Like we have it down as well as we can? Or do you feel like there's basic tech work to be done before we're prepared for that sort of explosion?Raffi GarabedianThat is a great question and a great framing of it. There's all sorts of really interesting technology in the laboratory today that promises to ultimately allow electrolysis to expand up in scale and down in cost. But, our problem is clear and present and urgent and so waiting for technology to emerge from the lab, which can take a decade or more because most of these devices are...first of all, electric chemistry is notoriously difficult to transition from the laboratory to reality.David RobertsWhen you say in lab, do you mean something fundamentally than what you described to me, the proton exchange membrane? You mean like fundamentally different kinds of electronics?Raffi GarabedianThat's right. There are different chemical cycles that people are experimenting with, different membranes, new catalysts, all sorts of really great science.David RobertsThere was something biological...capillary?Raffi GarabedianAll sorts of stuff.David RobertsWe can table that. Maybe we could mention that later.Raffi GarabedianYeah, all sorts of stuff that's out there. Electric Hydrogen, my company, we of course are aware of all of these kind of more advanced scientific developments. We've chosen a very different path because of the time horizon of the industry. So we are clearly focused on largescale decarbonization and both the market fundamentals, the secular trends and the policy frameworks are now in place to facilitate this industry to expand and become meaningful in the next five years. And that time horizon doesn't really support basic new technology development. And so we have opted to take a very well-developed mature technology, proton exchange membrane electrolysis, and adapted to our new needs.Now, that is done through some very core technical innovations. But the fundamental outcome of those innovations is to dramatically increase the productivity of that physical object. So that refrigerator-sized electrochemical stack we're talking about? Think about a five times increase in both the amount of power that we can run through it and the amount of hydrogen we can get out of it. The same physical-sized object. Now we can talk a little bit about how that's done. I'll be cagey about how we do it.David RobertsYes, this is exactly my set of questions right here. I figured you would be a little bit cagey about it, but maybe you can tell us some general things because we're talking about both kind of the electrolyzer itself, the core, the electrodes, the membrane. And then, as you said, there's all this "balance of plant" stuff. It's a big complex process which suggests that there are lots of places within that process to tweak things and tighten things up and make things more efficient, et cetera, et cetera.Can you tell us a little bit about in that whole big messy process where you are going in and tightening the screws and finding these efficiencies?Raffi GarabedianThe pat answer to your question is "everywhere," but let's peel that onion apart a little bit and explore it. So, let's start with the product we're building. The biggest electrolyzer that one can buy today is roughly, I think, a 20-megawatt plant.David RobertsWhat does that look like? What does a 20-megawatt electrolyzer plant look like? Is that a factory?Raffi GarabedianIt's a huge building that looks like a small chemical plant. And it has, you know, maybe 15 or 20 electrochemical stacks in it...David RobertsGot it.Raffi Garabedian...with a lot of plumbing and pipes and pumps and all sorts of things. And it's extremely expensive. That's the key, right? The key isn't actually how big it is. The key is the cost. Now, those things are related because the cost of plumbing, piping, valves, pumps, all of those things scales kind of with size. So to make it smaller is a good thing for cost, but also to keep it large in terms of its production capacity is extremely important.Let's talk about the application for a second before we go into the guts of the plant, because I think it's useful to have a frame of reference for scale. So you mentioned the current use cases for hydrogen, of which 95% is supplied using steam methane, reformation of natural gas. So those use cases are roughly 50-50 split between refineries. So hydrogen is a chemical input to the petrochemical refining process. And the other half goes to the production of ammonia, which is fertilizer.David RobertsThat's the current hydrogen market?Raffi GarabedianThat's the current hydrogen market, yeah. Now let's just talk for a second about an ammonia plant. There are dozens and dozens of these around the world. A typical ammonia plant, if you wanted to run it off of renewable green electrolyzed hydrogen would require rough numbers on the order of a gigawatt of renewable capacity and electrolysis. So that's a big number. And remember, we're talking about these electrochemical units which are at their fundamental building block level. They're one megawatt in scale. So it would be a thousand of these things. That's a problem.David RobertsA thousand of these stacks?Raffi GarabedianYeah, that's right.David RobertsPer ammonia plant?Raffi GarabedianPer single ammonia plant. World scale ammonia plant. Of which there are many, many. And that's just scratching the surface of what we want to do with hydrogen. Because, look, cleaning up ammonia production for fertilizer. That's great. That's some single digit percentage of global CO2 emissions right there. But the world is not interested in green hydrogen just for that reason. The world is interested in green hydrogen as an energy vector for moving energy from where renewables are abundant to where people are abundant and need the energy, for example, right? But also as an input to numerous industrial processes which cannot be electrified directly with renewables.For example, the DRI primary steel production process, which converts iron ore to metallic iron.David RobertsRight. Industrial fuel, airplane fuel...Raffi GarabedianShip fuel. So synthetic fuels is generally a broad category of applications so.David RobertsSeasonal energy storage is another...Raffi GarabedianYou got it.David Roberts...big one. Really, hydrogen can do literally anything. So you could go down the list.Raffi GarabedianYeah. And when you add up all those things that are very hard to decarbonize directly, you end up with about 50% of global emissions. I think the IEA's official number is something like 30%. But that skips over a very important factor you mentioned, which is the long duration storage of energy for the electric system. And when you add that back in, you get to about 50% of global emissions. So it's a massive, massive problem, requiring ultimately terawatts of capacity to be built and installed.David RobertsBecause I know some people have lots of weird hangups about hydrogen. I know there are some people out there who are skeptical about some of these larger uses of hydrogen. But I think it's worth saying that even if that estimate is off by several percent in either side, it's still many, many, many, many, many times the current production. Like, at a certain point, it hardly matters. The target is so far distant.Raffi GarabedianThat's right. You could be ten times over ambitious about what hydrogen could do for the world and still have an immense scaling opportunity and challenge ahead of you. Because again, we're talking about terawatts of ultimate available or necessary capacity to decarbonize all of these sectors. A tenth of that is 100 gigawatts. So big numbers here that we're talking about. So how do we address the scale of the opportunities and the scale of the plants that have to be built with technology that's at a fundamentally different scale today?David RobertsRight. We cannot meet that scale we need with current technology.Raffi GarabedianExactly. So we can just try to make more of them. But the issue with that is that they're too expensive when they're that small. So the other thing we can try to do is make them more productive. And the word I use is: "higher throughput." So again, take those same physical-sized objects and get a lot more value out of them. The name of the game in all of this is to make green hydrogen cheap. Let's not lose sight of that. Some of the applications you mentioned for example, shipping fuel. The economic parity point for shipping fuel is almost impossible to reach with anything other than what's currently being burned, which is bunker fuel.It's the sludge that comes out of the bottom of a distillation column and a petrol... super gross. Bunker fuel, because it's so gross, is super cheap. Now we know we can't compete economically against bunker fuel. Nothing can. However, the alternative of continuing to burn bunker fuel is less and less tractable. And so, both by legal restriction and through other economic means, the cost of the conventional approach, the bunker fuel approach, is gradually rising and we see it rising at an accelerated pace as time goes forward. So what we have to do if we want to change that industry, just as an example, right? We have to drive down the cost of green hydrogen-derived fuels very rapidly to intersect as soon as possible with the rising cost of burning bunker in ships.David RobertsAnd we're all presuming and we'll maybe discuss this in a little bit more detail in a minute. But the assumption behind all this is that policy is going to help do this. Like policy is going to be pushing up the price of fossil fuels—one hopes—even as technology and scale are pushing down the cost of hydrogen.Raffi GarabedianIt's happening as we speak. Okay, let's go back to the machine. So the machine has got to be big.David RobertsYes.Raffi GarabedianAnd let me just say the product that we are building at Electric Hydrogen, it's about an acre in size. It's funny to think of that as a product, but that's our product.David RobertsAnd that's multiple... stacks within that?Raffi GarabedianIt's multiple stacks, but not nearly as many as you might think. And it's comprised of modular process units. So think about kind of tractor trailer-sized frames like you might see in an oil field or a gas field. These are fluid processing units, heat exchangers, tanks, pumping skids, water treatment units and power conversion equipment, right? So we modularize all this equipment so that it can be easily put in place at a project site interconnected to produce a large-scale hydrogen plant. When I say large-scale, our product, that one acre size thing, that is 100 megawatt plant.David RobertsWhat is 100 megawatt referring to? 100 megawatts worth of hydrogen coming out or energy going in?Raffi GarabedianThat's the energy going in to the electrolyzer. And if you want to get geeky, that's about 50 tons per day of hydrogen output at full nameplate capacity. Now, a green hydrogen electrolyzer should almost never run at full capacity all day long.David RobertsOh, really?Raffi GarabedianThe only scenario in which you should be able to do that is if you're connected to a hydroelectric power plant.David RobertsAre you talking about because of renewables coming and going?Raffi GarabedianExactly.David RobertsBeing variable.Raffi GarabedianWhich is kind of the point of the architecture of our product as well. Is to be able to follow and track those renewables without firming the energy. And it has significant bearing on the choice of technology and the design of both the electrolyzer itself and also the whole plant that's put around it.David RobertsAnd to what extent are you improving the electrolyzer itself? From what I understand, the electrodes are made from fairly specialized metals? Like, are you looking for cheaper electrodes? Are you trying to improve the actual physical electrolyzing process itself?Raffi GarabedianThe latter. So there are really two approaches to making electrolysis more cost effective to making the equipment cheaper, which goes directly to making the gas cheaper. The two approaches, broadly speaking are: make the existing hardware for less money, find cheaper materials to make it out of, reduce the labor content of the manufacturing, et cetera, et cetera. The other approach is: get more out of the same hardware, the same kind of hardware. Now, when we analyzed these two approaches when we were starting the company, we kind of looked at the scenarios and what we thought could be done.What's the entitlement for the two approaches? Our conclusion was there might be 30-40% cost to find in the existing technologies if one can thrift the materials, find cheaper materials, lower labor, all that, right? And frankly, we're not all that good at that. I mean, we're good at it, but it's not our forte. What we're actually really good at is driving a technology roadmap around performance. And when we thought that through and really analyzed the entitlement, we found numerous opportunities to get multiples higher performance out of what is essentially existing technology, materials and components that are well developed.David RobertsAnd this is the balance of plant stuff you're talking about, like, stuff outside the elec...?Raffi GarabedianNo, this is in the very, very guts of the electrolyzer cell itself. So, we take a device physics approach to the problem. For those of your listeners who don't know my background, I was Chief Technology Officer at First Solar for many years. My co-founder at Electric Hydrogen was also Chief Technology Officer at First Solar. Before that, he was with Bell Labs running their device physics department. Long career in electrical and electrochemical devices.David RobertsYeah, I guess I'm a little baffled how you get more out of the same materials, so please.Raffi GarabedianYeah. And the way you do it is by understanding the physics of the device, deconvolving the various contributors to both performance losses and efficiency losses, and designing solutions to those material science and interfacial and transport problems. So it's all around interfaces, material choices, and the physics of how the device operates. And so with that kind of device physics approach, we've been able to quintuple essentially, like, dramatically improve the performance of the electrolyzer cell itself. Now, that gives us the ability to, without changing the size or materially changing the cost of that refrigerator thing, it allows us to get a lot more power into it and a lot more hydrogen out of it, and that's the secret trick. Right, so our hydrogen production is extremely physically dense.Now, when you sell an electrolyzer, what does the customer care about? The customer is typically a project developer or industrial owner. They care about the hydrogen production cost. Ideally, about half of that cost is the cost of capital that's involved with the purchase of the plant.David RobertsRight.Raffi GarabedianSo when you buy a plant like this, you price it in terms of dollars per watt or dollars per ton of hydrogen per day produced. So the more you can get into and out of that thing, the lower its price proportionately on a dollar per watt basis. So if I make that refrigerator size box and I can get a megawatt out of it, its price is a dollar, right? If it costs a million dollars to make or to sell, it's a dollar. If I can get just make up a number 10 megawatts out of it, wow. That same thing costs ten cents a watt.David RobertsSo those are your biggest gains you're making. Or is it in the electrolyzer?Raffi GarabedianAbsolutely. And the electrolyzer then has knock on effects and ramifications for the rest of the balance of the plant that's around it. If you look at our plant architecture, at first flush, it looks like others. But on more detailed inspection, one finds a lot of very critical differences. Some of them actually add cost to the plant relative to a conventional approach in order to support this really fancy, super high energy electrolyzer stack. But on average, in some total, the cost is greatly reduced even at the plant scale.David RobertsOh, that's... sort of counter my intuitions. I sort of figured that with nobody having really tried to scale these things up to the point you're scaling up, I would think that all the stuff outside the electrolyzer all that plumbing and structure of the plan itself and.... I figured there's lots of efficiencies in that stuff that just nobody's thought to look at yet or squeeze out of yet.Raffi GarabedianYeah, I think that's also true. Maybe there's about 500 megawatts of electrolysis installed in the world today. I think the vast majority of those plants are custom engineered and designed and built—stick built by EPCs—for a site, right. So there's not a whole lot of economy of scale or learning yet in this industry.David RobertsAnd your acre-size plant is a set thing. It's the same every time you build it?Raffi GarabedianYeah, that's why I call it a product. It's not a project, it's not engineered for a site. You can buy any size and shape electrolyzer you want from us as long as it's this one. It's like the old black Model T.David RobertsWell, theoretically you could build two if you had two acres. Right?Raffi GarabedianYeah.David RobertsModular in that sense.Raffi GarabedianThat's right. And that modular approach is actually really interesting in the market as well because we're at the early stages of this industry's growth and so project finance is a major constraint. Of course, people who are building a gigawatt-scale plant. They don't want to take the risk on building that whole gigawatt all at once.David RobertsRight.Raffi GarabedianThey want to build it in small modules. So it does also serve a market need in that regard.David RobertsA couple of other questions about cost. How big a factor is the cost of the energy you're buying, the cost of the renewable energy. Like, if renewable energy continues to get cheaper or for whatever reason, you're able to just find cheaper energy, does that make a major difference or is that marginal?Raffi GarabedianYeah, it's a huge difference. So let's talk about some numbers here, okay? So hydrogen produced from steam methane reforming of natural gas in Texas and Louisiana today, which is kind of the lowest cost region of production in the world, save maybe a few places in the Middle East—which are comparable. That hydrogen costs about a $1.50 to $2 a kilogram to produce and buy. And it's directly proportional almost to the price of natural gas. Okay, so that's the bogey. If you can beat a $1.50 a kilo or lower, the world is your oyster because you're at so called fossil parity hydrogen.David RobertsRight.Raffi GarabedianThat's—and by the way, that's the dirtiest hydrogen. That...well, not quite. Hydrogen from coal is dirtier, but that's dirty hydrogen, that's so called gray hydrogen, right. Where the CO2 is emitted. If you try to capture the CO2, that price only goes up. Now, when you talk about electrolysis, the energy input to the production of hydrogen for most electrolyzers equates to about, well, every $10 a megawatt hour of electricity price contributes about $0.60 roughly per kilogram of hydrogen production cost.David RobertsSo really makes the difference whether you're competing with that cheap stuff or not.Raffi GarabedianThat's right. So the best in class solar energy power purchase agreement that I've seen is just under $10 a megawatt hour in the Middle East. We also see in the US, new build wind in the wind belt that's on that order, below $10 a megawatt hour, is possible. But if your energy is $30 a megawatt hour, you're already going to be north of a $1.50 a kilogram hydrogen production cost just with the energy input, not even counting the cost of capital to build the electrolyzer plant.David RobertsRight. And you have limited control over that. I mean, in some sense, you're subject to what energy is available.Raffi GarabedianYes and no. So here's what we know. We know that renewable power all around the world where the resource is rich is extremely inexpensive as long as you don't try to firm it, as long as you can take it when it's produced. Anything you do to try to firm that power adds substantial cost, right? Because batteries are expensive.David RobertsYes.Raffi GarabedianSo the key for making low cost hydrogen is to take the renewable energy intermittently is to take it when the wind's blowing, when the sun's shining.David RobertsI mean, I'm sure you get this question all the time. One of the, you know, I sort of threw this out on Twitter, and I got many versions of this question, which is: how is it economic to run a hydrogen-making plant where the capacity factor is, whatever, 40% or 50% or lower? How do you pencil out the economics when your energy supply is variable?Raffi GarabedianWell, your Twitter followers are brilliant.David RobertsI could not agree more.Raffi GarabedianThat is exactly why we have been working so hard towards this singular goal of making a large-scale electrolyzer plant that's really cheap. Not cheap on a dollars per unit basis, but cheap on a dollars per watt or dollars per ton of hydrogen produced per day basis, right? That's the key. If your capital plant, your electrolyzer, is too expensive, you can't afford to run it at a low capacity factor.David RobertsRight.Raffi GarabedianIf it's cheap enough, now you can afford to use really cheap energy and run your electrolyzer intermittently. That is the secret. That is the way you get to low cost hydrogen production. That's also completely green hydrogen production. The other thing we should note here is that if you try to firm the energy input to an electrolyzer using the grid, what you're literally doing is in the hours when the wind isn't blowing or the sun isn't shining, you are ramping up a fossil generator somewhere to power that electrolyzer. And that is a terrible outcome!David RobertsAnd you no longer have green hydrogen!Raffi GarabedianYou have the worst possible thing. You're burning a fossil fuel, which you could have converted directly into hydrogen to make electricity and then convert back into hydrogen right through an electrolyzer. That's a terrible thing to do. By the way, there's a policy...I don't know, maybe I'll call it a food fight going on in the US right now around the rulemaking that results from the IRA. I go back to policy.David RobertsWe'll get there. So accommodating intermittent energy input is not so much a specific technological thing as just a price thing. If you can get your plant cheap enough, then you can make it work with intermittent energy.Raffi GarabedianYeah, it's a bunch of things. We have to make the plant cheap enough so that it can work with intermittent energy. That's the only scalable kind of clean energy in the first place. There's a lot of hydro in the world, but not enough to solve a terawatt-scale problem.David RobertsRight. Well, people talk about building nuclear energy plants specifically to make hydrogen. People talk about using offshore wind energy specifically to make hydrogen, that way you wouldn't have to string a power wire out to the offshore wind. Is any of that stuff on your radar or you think that's mostly distraction?Raffi GarabedianWell, the energy problem is extremely localized. It's regional. So if you're in a place where natural gas is super expensive and in short supply for geopolitical reasons, whatever, your fossil parity price for hydrogen might be a lot higher than the numbers I threw out, right? So if you're in Northern Europe and you're concerned about Russian gas supply, you might be willing to spend a lot more for your hydrogen production. And in those scenarios, things like offshore wind could make a lot of sense.Nuclear is a tough one for me to understand, quite frankly, because, look, I mean, the best use of a flexible nuclear plant, I think, is to continue to clean up the electric system first and foremost. So if we're able to figure out how to build and scale more nuclear, wow, let's go do that. I'm not sure making hydrogen out of it is the right answer. Also, the price of that power is quite high.David RobertsYes. I can just tell you, Raffi, out there in the world, out there on Twitter world, people really just want nuclear. They want it to be useful for something, and so they propose it for everything. So one more question about the physical thing here, which is: where are these things currently manufactured? Because one of the big arguments going on around all the rest of clean energy is who's making it and who should make it, and is it worth trying to onshore manufacturing? Who makes electrolyzers today?Raffi GarabedianToday... I mentioned I spent over a decade in the solar industry. When I started in 2008, the solar industry felt a lot like the electrolyzer industry is today. So we had really strong industrials in the electrolyzers today, just like in solar back then. We had really strong industrial players in the US and Europe, who kind of had the core technology and sold the bulk of the equipment. But we're seeing China emerging. They're doubling down on electrolysis, and they're coming up in capacity. I think there's probably more electrolyzer manufacturing capacity in China today than anywhere else in the world. Though, it's a different kind of business than solar. And I think exporting these very, very large units from China to the rest of the world is going to be a different kind of challenge. I'm not sure it rolls the same way.David RobertsRight, so the plants you're building in the US are manufactured in the US? All your parts and pieces?Raffi GarabedianYeah, we'll be manufacturing in the USDavid RobertsOne of the things we've been talking a lot about on the pod recently are learning curves and what kinds of technologies do and don't get on learning curves. And this work out of Oxford last year made such a big splash—claimed that electrolyzers are on a learning curve. So what's your take on that? Is there an answer about the percentage that the cost falls per doubling of deployment? Or is it still, do you feel, like, too nascent to have an answer to that question?Raffi GarabedianYes, I think we are too nascent. Look, I mean, learning curves are an analysts' way of explaining the trajectory of a whole industry's work in an area. The goal of any given company, technology company, is to be a nonlinear force in going down that curve. Right, so, I don't want to be on a learning curve at Electric Hydrogen. I want to disrupt that learning curve and put it in a new direction. And, you know, the analyst learning curve is simply the aggregate, the average, of a whole bunch of companies trying to do the same thing, which has come out on top with the best solution to the problem. So I don't put a lot of stock in learning curves. I understand why they exist. They're useful, particularly on the buy side, to kind of try to understand and predict the future.David RobertsWell, they're good descriptive. The question is whether they're predictive at all, right?Raffi GarabedianYeah. And predicting the future is notoriously difficult, right, so.David RobertsBut do you think, based on your experience, that costs are headed down? You're confident that costs are headed toward that target they need to hit, and that target is reachable?Raffi GarabedianI am. And our explicit goal at our company, at Electric Hydrogen, is to accelerate that cost down curve. So it's not that electrolysis isn't going to be scaled without us. It's not that it's not going to get to the price point it needs to without us. We think our role in this industry, at least with the role we're going to try to play, is to be an accelerant, a catalyst.David RobertsPardon the pun. But it's odd, given what a central role electrolyzers play in this sort of vision of a decarbonized future. I find it odd, I guess, that I just haven't heard of more people doing what you're doing, trying to squeeze costs out of this juncture of the whole system. Do you have a lot of competitors? Do people coming to this...like who's solar? You could name five zillion companies, five zillion research labs. Is there comparable brain power going toward this right now?Raffi GarabedianThere's a lot of research. So if you look at companies involved in electrolysis, it's kind of bimodal. On the one extreme, you have a group, a mode of companies who are large established players. I'm talking about thyssenkrupp, Siemens, Cummins, folks like that, right? And then on the other extreme, you have a large number of very small companies who are at that low technology readiness level stage. So kind of in the lab playing with new membrane materials or new catalyst chemistries or whatnot. Now, the large industrial players, they tend to be very conservative and slow moving in their technology, road mapping. They tend to be risk averse because they have massive businesses and their reputation is contingent on every piece of that business performing as advertised. So they don't like to take risks. And then on the other hand, you've got the small companies, the material science-y companies, who might be a decade from the market. There are relatively few companies, you could name a small handful today in kind of the middle ground, which is where we are.David RobertsRight, right.Raffi GarabedianWhere we're rapidly developing and commercializing technology that has relatively low risk profile.David RobertsRight. And part of what you could do if you succeed, and tell me if I'm wrong about this, is de-risk this a little bit and lure some of those bigger players into devoting more resources to this.Raffi GarabedianAbsolutely. Now, I don't know, history is sometimes a good teacher. And again, if we go back to solar, the big industrials all got out.David RobertsYeah, I remember BP bailing.Raffi GarabedianOh, yeah, everybody bailed. And whether... you could list the litany of names who no longer exist in the solar industry, who really wilted under very, very rapid technology innovation cycles.David RobertsYeah.Raffi GarabedianAnd resulting steep cost reduction curves. So the learning curve in solar was just brutal and fast and hard. And if you weren't willing to run with it, you weren't going to survive in it. Electrolyzers very well could go that way. They also could go the way of wind, right? So wind power has really been a game that's been dominated by large industrials because wind has scaled the other direction. It hasn't scaled in the volume axis, it's scaled on the size axis. So frankly, the physical size of those units makes them very hard to innovate rapidly.David RobertsRight. Fairly curious where EVs fall and that sort of... maybe it's too early to tell.Raffi GarabedianI think it might be.David RobertsWhether the big players will be able to pivot fast enough.Raffi GarabedianYeah, I'll hold my opinions on that.David RobertsAlright, so at long last, let's talk about policy. Because one of the questions I got about this, which I think is a very good question, is the danger, it seems to me, of being in the green hydrogen business is that the danger is getting out ahead of policy such that you start producing on a greater scale than there is demand. Generally, the market will opt for the cheapest hydrogen until forced not to by some sort of policy. So is there enough policy support for green hydrogen now that you're confident demand will exist for whatever amount you can produce?Raffi GarabedianYeah, I think in the long term, absolutely. Yes both...David RobertsLong term is, we're all dead in the long term, or whatever the phrase is.Raffi GarabedianYeah. Well, let's frame it more carefully. So five plus years out.David RobertsRight.Raffi GarabedianI think the answer is yes. There is still a big question mark around the two to five year time frame. There are gigawatts and gigawatts of announcements globally of companies who are building—air quotes building—fossil-free hydrogen production plants for industrial uses, for energy uses, for grid firm, all sorts of applications that we've talked about and mentioned. But what does it take for those to get to a financial investment decision and for ground to be broken and for electrolyzers to be installed? That's the question, right.And I think there is a lot of risk in that. It comes down to understanding, from our point of view as a company in the business of making and selling electrolyzers, we do as much diligence on our customers as they do on us. So our customers are worried about our technology. "It's a new technology. We haven't seen it before, and you guys haven't really built one before. How do we know it's going to work? Okay, great." That's our customers diligence on us. The other side of that coin is, "Hey, we want to understand... who's your offtaker for hydrogen? Why do they want the gas?"David RobertsAlright.Raffi Garabedian"Why is it economical today? What policies are supporting it? What's the end use segment and application? And how does all that work? Why does your project actually make sense?" Because if we believe it actually makes sense, then we can have much, much higher confidence that it will go through, that it will get built.David RobertsA little wariness on both sides then, at this point, like the supply side and the demand side.Raffi GarabedianAbsolutely. I would say the reality-to-hype ratio is about one to ten right now.David RobertsYes, it is right there in that cycle. But, presumably your business thesis, the way you're raising money, is by saying demand is on the rise.Raffi GarabedianDemand is on the horizon. And we look really carefully and thoughtfully, at least we try to, at the leading indicators that predict demand. Because, look, I mean, this is an industry that essentially doesn't exist and has never existed before, so we can't use past performance to predict the future, right? So we've got to look at leading indicators. We've got to look a layer or two underneath what's being built today to understand what's driving that behavior. And we think the fundamentals are there. So a number of things come together. Certainly the European policy framework has firmed up, continues to firm up, and is driving bona fide, like, verifiable activity on the European subcontinent.David RobertsIs that just the cap and trade? Is that just the general squeezing of carbon? Or there's the hydrogen-specific stuff you're talking about.Raffi GarabedianThere's hydrogen-specific stuff in Europe as well, but there's also a lot of secondary, "Hey, it can only be solved. We can only meet these requirements with hydrogen we don't know how else to do it" kind of things. And then when we look at the US, again the IRA, which I mentioned, that makes fossil-free hydrogen an economic viability, like with the snap of a finger.David RobertsAnd that's just a big tax credit. That's like a per production tax credit. What exactly is the structure of the...?Raffi GarabedianThat's right, it's framed as a production tax credit. So for each kilogram of hydrogen you produce, you get a certain number of dollars in tax credit back, which goes to the bottom line of a project.David RobertsAnd does it have any stuff about the other colors of hydrogen, or is this a black and white, sort of like, "We'll give you money if you do green."?Raffi GarabedianWell, it's thoughtfully framed, actually, in terms of the greenhouse gas intensity of the hydrogen that's produced. It's technology agnostic, it's greenhouse gas indexed, so you can get anywhere from $0 to $3 a kilogram tax credit, depending on your carbon intensity. I mentioned a little while ago there's a bit of a food fight going on around the rules for that because the quality of the electricity going into an electrolyzer is what's being fought over.David RobertsOh, interesting.Raffi GarabedianYeah. Some of us in the industry kind of want to take a long view, and the long view says, "Gee, that electricity really needs to be directly fed from a renewal plant." Not on one wire, but at least time-synchronized and locationally matched.David RobertsAs opposed to just sort of using grid electricity and then buying wrecks or whatever.Raffi GarabedianYou got it. That's exactly the fight that's going on.David RobertsThis is, again, Volts listeners will find this whole discussion familiar from the distinction between going 100% renewable and going 24/7 renewable, matching on an hour-to-hour level.Raffi GarabedianIt is the same exact thing being fought out right now against this $3 potential tax credit.David RobertsSo you're advocating for, "we need to be doing this hour-by-hour so we know...not just that we're offsetting, but that we're using clean energy."Raffi GarabedianI will unabashedly say we're advocating to do it right, for God's sake.David RobertsAnd this is ambiguous in the language of the law. So this will be...who's making this decision in the end?Raffi GarabedianYeah, like any law, right. There's a of lot rules associated with it. So yeah, the decision is being effectively litigated at this point.David RobertsAnd does the IRA tax credit sort of add a stroke, make your current product viable? Is it enough in and of itself?Raffi GarabedianYeah, frankly it does. But I will also tell you that, again, based on experience in solar and the resulting scar tissue, I'm extremely wary of subsidies. I value them highly. They're necessary to get a nascent industry like this off the ground in the face of a much cheaper but dirty alternative, which is fossil fuels.David RobertsIt's the iconic case for subsidies.Raffi GarabedianAbsolutely. But having said all that, our goal as a business is to enable subsidy-free fossil parity hydrogen production as soon as possible because the subsidies are always at risk. They're expensive, right.David RobertsBut the ones in IRA are not capped or time as an expiration date or?Raffi GarabedianI believe it's a ten-year.David RobertsSo that's a pretty good runway. It's a great runway assuming it stays in place, right.Raffi GarabedianAssuming it stays in place. And of course, these things are political at the end of the day.David RobertsYeah.Raffi GarabedianSo for a lot of reasons, both fundamental reasons and also political reasons, our goal is to be subsidy-free to enable subsidy-free fossil parity pricing as soon as possible. And we think we can do that in under five years.David RobertsReally? That's pretty tight. Like, have you built a plant yet? Where where are you at in deployment? Have you got a demonstration plant? Where...what's going on?Raffi GarabedianWe have a small scale prototype here in California. We'll be building a pilot towards the end of this year. So the answer to your question is no.David RobertsThe pilot is the full-acre plant?Raffi GarabedianIt's the indivisible unit of that full-acre thing. It's not the full-acre thing, but that'll be coming in 2024.David RobertsAnd background policy. I know that the IRA is a big, huge deal. I know there are supports in Europe. What about procurement rules? I think, like, the federal government now has some sort of like, rules about the cleanliness of the hydrogen can buy, or big institutions basically saying, "We'll be a market for this, we'll be guaranteed offtakers." Is there much of that, or is it mostly the IRA you're banking on?Raffi GarabedianWell, right now in the US, it's mostly the IRA that's driving adoption. Well, it's the IRA coupled to corporate procurement and decarbonisation strategies. And just like you see in the world of renewable energy procurement, the same is going on now in renewable fuels, clean fuels, and hydrogen writ large as an element of various industries.David RobertsRight, well, like steel and stuff like that, too. If you want green steel, you're basically saying you want hydrogen. Green hydrogen.Raffi GarabedianThat's right. And if you survey the steel industry, you'll find a spectrum of opinions from company to company as to how seriously these producers are approaching decarbonization. Some are extremely committed to decarbonizing rapidly, and others, I guess I would say, are making moderate moves, grudgingly in that direction. So you see that in every sector that we work in. You see it in ammonia production, you see it in fuels, you see it in steel. There's a spectrum of opinions.David RobertsWell, as you said, specifically in the hydrogen market, there's this sort of like, "You go first. No, you go first." between the buyers and the sellers. It's a very specific moment in the market.Raffi GarabedianIt is. You could say it's a high risk moment. It is. It's also a high opportunity moment.David RobertsExactly.Raffi GarabedianOne of the things about this industry that I think will track in a similar direction as both wind and solar did, there's going to be a large wave of adoption. And if you're not a participant in that first wave of adoption as a technology provider, I think it could become very, very difficult to get down the learning curve and to scale at a future date.David RobertsSo you think early movers have a big advantage here?Raffi GarabedianI do think so. I do think so.David RobertsBut it's worth saying, you seem confident that these efficiencies exist, that the technological possibility exists. So even if, God forbid, your company doesn't make it, you think this is going to happen, these electrolyzers are going to get cheaper and cheaper until green hydrogen is cost competitive? You think that's more or less inevitable?Raffi GarabedianI do. I think that's inevitable. I also think the continued reduction in renewable power costs is inevitable. Despite there are short-term disruptions in that market kind of supply, demand, balance thing. But in the longer term, again, it only gets cheaper. It doesn't get more expensive.David RobertsAwesome. I've kept you a long time, but I guess just by way of a final question, is you're, as you say, specifically not messing with the stuff on the lab right now. You are trying to economize and bring down the cost of existing technology. Is your sort of like business plan open to the idea that if one of these capillary things come along or one of these sort of fundamentally new...because this is a question about storage...that I often ask people in the storage industry. Like, lithium ion is so established and so far ahead that if you want to compete with lithium ion, at the very least, you need to be able to slip stream in to basically the same manufacturing process because otherwise you're just starting from nothing and you'll never catch up.Is this the sort of thing where if a fundamentally new kind of electrolyzer comes along that you could just slot it in? Or just how modular is this and how open is your business plan to sort of big advances in the technology like that?Raffi GarabedianOh, we're not only open to it, we're eager for it. And we expend some of our R&D effort on just those kinds of directions as well as talking to other companies who are more in the lab than we are. So, yeah, we're absolutely open to it. It's early days in this industry and there are very few examples in the world of technology where the solution today is the solution 20 years from now, right? So this is a long game. We're going to be doing this for a while, and the technology will shift and will adapt with it, but not at the expense of losing focus. Again, I think we have an opportunity that's three to five years in front of us to scale this industry from a glimmer in our eyes to something that actually matters at the scale of the global energy system. That's what we're laser focused on.David RobertsWell, thank you so much for coming. This is hugely clarifying for me now. I feel like I have a little bit something in that electrolyzer bucket in my head now, and I know our listeners will appreciate that too. Thanks so much for coming on.Raffi GarabedianThis has been a great conversation. Thanks for all the awesome questions and thanks for having me on the show.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

British researcher Erica Thompson’s recently published book is a thorough critique of the world of mathematical modeling. In this episode, she discusses the limitations of models, the role of human judgment, and how climate modeling could be improved.(PDF transcript)(Active transcript)Text transcript:David RobertsEveryone who's followed climate change for any length of time is familiar with the central role that complex mathematical models play in climate science and politics. Models give us predictions about how much the Earth's atmosphere will warm and how much it will cost to prevent or adapt to that warming.British researcher Erica Thompson has been thinking about the uses and misuse of mathematical modeling for years, and she has just come out with an absorbing and thought-provoking new book on the subject called Escape from Model Land: How Mathematical Models Can Lead Us Astray and What We Can Do About It.More than anything, it is an extended plea for epistemological humility — a proper appreciation of the intrinsic limitations of modeling, the deep uncertainties that can never be eliminated, and the ineradicable role of human judgment in interpreting model results and applying them to the real world.As Volts listeners know, my favorite kind of book takes a set of my vague intuitions and theories and lays them out in a cogent, well-researched argument. One does love having one's priors confirmed! I wrote critiques of climate modeling at Vox and even way back at Grist — it's been a persistent interest of mine — but Thompson's book lays out a full, rich account of what models can and can't help us do, and how we can put them to better use.I was thrilled to talk with her about some of her critiques of models and how they apply to climate modeling, among many other things. This is a long one! But a good one, I think. Settle in.Alright, then, with no further ado, Erica Thompson, welcome to Volts. Thank you so much for coming.Erica ThompsonHi. Great to be here.David RobertsI loved your book, and I'm so glad you wrote it. I just want to start there.Erica ThompsonThat's great. Thank you. Good to hear.David RobertsWay, way back in the Mesozoic era, when I was a young writer at a tiny little publication called Grist—this would have been like 2005, I think—one of the first things I wrote that really kind of blew up and became popular was, bizarrely, a long piece about discount rates and their role in climate models. And the whole point of that post was, this is clearly a dispute over values. This is an ethical dispute that is happening under cover of science. And if we're going to have these ethical judgments so influential in our world, we should drag them out into the light and have those disputes in public with some democratic input.And for whatever reason, people love that post. I still hear about that post to this day. So, all of which is just to say, I have a long-standing interest in this and models and how we use them, and I think there's more public interest in this than you might think. So, that's all preface. I'm not here to do a soliloquy about how much I loved your book. Let's start with just briefly about your background. Were you in another field and kept running across models and then started thinking about how they work? Or were you always intending to study models directly? How did you end up here?Erica ThompsonYeah, okay. So, I mean, my background is maths and physics. And after studying that at university, I went to do a PhD, and that was in climate change physics. So climate science about North Atlantic storms. And the first thing I did—as you do—was a literature review about what would happen to North Atlantic storms given climate change, more CO2 in the atmosphere. And so you look at models for that. And so, I started looking at the models, and I looked at them, and this was sort of 10-15 years ago now—and certainly there's more consensus now—but at that time, it was really the case that you could find models doing almost anything with North American storms.You could find one saying... the storm tracks would move north, they'd move south, they'd get stronger, they'd get weaker, they'd be more intense storms, less intense storms. And they didn't even agree within their own aerobars. And that was what really stuck out to me, was that, actually, because these distributions weren't even overlapping, it wasn't telling me very much at all about North Atlantic storms, but it was telling me a great deal about models and the way that we use models. And so I got really interested in how we make inferences from models. How do we construct ranges and uncertainty ranges from model output? What should we do with it? What does it even mean? And then I've kind of gone from there into looking at models in a series of other contexts. And the book sort of brings together those thoughts into what I hope is a more cohesive argument about the use of models.David RobertsYeah, it's a real rabbit hole. It goes deep. The book is focusing specifically on mathematical models, these sort of complex models that you see today in the financial system and the climate system. But the term "model" itself, let's just start with that because I'm not sure everybody's clear on just what that means. And you have a very sort of capacious definition.Erica ThompsonI do, yeah.David Roberts...of what a model is. So just maybe let's start there.Erica ThompsonYeah. So, I mean, I suppose the models that I'm talking about mostly, when I'm talking in the book, is about complex models where we're trying to predict something that's going to happen in the future. So whether that's climate models, weather models—the weather forecast is a good example—economic forecasts, business forecasting, pandemic and public health forecasting are ones that we've all been gruesomely familiar with over the last few years. So those are kind of the one end of a spectrum of models, and they are the sort of big, complex, beast-end of the spectrum. But I also include, in my idea of models, I would include much simpler ones, kind of an Excel spreadsheet or even just a few equations written down on a piece of paper where you say, "I'm trying to sort of describe the universe in some way by making this model and writing this down."But also I would go further than that, and I would say that any representation is a model insofar as it goes. And so that could include a map or a photograph or a piece of fiction—even if we go a bit more speculative—fiction or descriptions. These are models as metaphors. We're making a metaphor in order to understand a situation. And so while the sort of mathematical end of my argument is directed more at the big, complex models, the conceptual side of the argument, I think, applies all the way along.David RobertsRight, and you could say—in regard to mathematical models—some of the points you make are you can't gather all the data. You have to make decisions about which data are important, which to prioritize. So the model is necessarily a simplified form of reality. I mean, you could say the same thing about sort of the human senses and human cognitive machinery, right? Like, we're surrounded by data. We're constantly filtering and doing that based on models. So you really could say it's models all the way down.Erica ThompsonYes.David RobertsWhich I'm going to return to later. But I just wanted to lay that foundation.So in terms of these big mathematical models, I think one good distinction to start with—because you come back to it over and over throughout the book—is this distinction between uncertainty within the model. So a model says this outcome is 60% likely, right? So there's like a certain degree of uncertainty about the claims in the model itself. And then there's uncertainty, sort of extrinsic to the model, about the model itself, whether the model itself is structured so as to do what you want it to do, right? Whether the model is getting at what you want to get at.And those two kinds of uncertainty map somehow onto the terms "risk" and "uncertainty."Erica ThompsonSomehow, yes.David RobertsI'm not totally sure I followed that. So maybe just talk about those two different kinds of risks and how they get talked about.Erica ThompsonSo I could start with "risk" and "uncertainty" because the easiest way to sort of dispatch that one is to say that people use these terms completely inconsistently. And you can find in economics and physics, "risk" and "uncertainty" are used effectively in completely the opposite meaning.David RobertsOh, great.Erica ThompsonBut generally one meaning of these two terms is to talk about "uncertainty," which is, in principle, quantifiable, and the other one is "uncertainty," which perhaps isn't quantifiable. And so in my terms, in terms of the book, so I sort of conceptualize this idea of "model land" as being where we are when we are sort of inside the model, when all of the assumptions work, everything is kind of neat and tidy.You've made your assumptions and that's where you are. And you just run your model and you get an answer. And so within "model land," there are some kind of uncertainties that we can quantify. We can take different initial conditions and we can run them, or we can sort of squash the model in different directions and run it multiple times and get different answers and different ranges and maybe draw probability distributions.But actually, nobody makes a model for the sake of understanding "model land." What we want to do is to inform decision making in the real world. And so, what I'm really interested in is how you take your information from a model and use it to make a statement about the real world. And that turns out to be incredibly difficult and actually much more conceptually difficult than maybe you might first assume. So you could start with data and you could say, "Well, if I have lots of previous data, then I can build up a statistical picture of how good this model is," whether it's going to be any good.And so you might think of the models and the equations that sent astronauts to the moon and back. Those were incredibly good and incredibly successful. And many models are incredibly successful. They underpin the modern world. But these are essentially what I call "interpolatory models." They're basically...they're trying to do something where we have got lots of data and we expect that the data that we have are directly relevant for understanding whether the predictions in the future are going to be any good.David RobertsRight.Erica ThompsonWhereas when you come to something like climate change, for example, or you come to any kind of forecasting of a social system, you know that the underlying conditions are changing, the people are changing, the politics are changing, even with the physics of the climate, the underlying physical laws, we hope, are staying the same. But the relationships that existed and that were calibrated when the Arctic was full of sea ice, for example, what do we have to go on to decide that they're going to be relevant when the Arctic is not full of sea ice anymore? And so we rely much more on expert judgment. And at that point, then you get into a whole rabbit hole of, well, what do we mean by expert judgment?And maybe we'll come on to some of these themes later in the discussion, but these ideas of trust. So how are we going to assess that uncertainty and make that leap from model land back into the real world? It becomes really interesting and really difficult and also really socially, sort of, dependent on the modeler and the society that the model is in.David RobertsRight, it's fraught at every level. And one of the things that I really got from your book is that it's really, really far from straightforward to judge a model's quality. Like, you talk about... what is the term, a horse model? Based on the guy who used to make hand gestures at the horse, and the horse looked like it was doing addition, looks like it was doing math, but it turns out the horse was doing something else entirely. And so it only worked in that particular situation. If you took the horse out of that situation, it would no longer be doing math.Erica ThompsonAnd I think what's interesting is that the handler wouldn't even have realized that. That it wasn't a deliberate attempt to deceive, it was the horse sort of picking up subconsciously or subliminally on the movement and the body language of the handler to get the right answer.David RobertsRight. Well, this is for listeners, this is kind of a show that this guy used to do. He would give his horse arithmetic problems and the horse would tap its foot and get the arithmetic right and everybody was amazed. And so your point is just you can have a model that looks like it's doing what you want it to do, looks like it's predictive, in the face of a particular data set, but you don't know a priori whether it will perform equally well if you bring in other data sets or emphasize other data sets or find new data. So even past performance is not any kind of guarantee, right?Erica ThompsonYeah. And so it's this idea of whether we're getting the right answer for the right reasons or the right answer for the wrong reasons. And then that intersects with all sorts of debates in AI and machine learning about explainability and whether we need to know what it's doing in order to be sure that it's getting the right answer for the right reasons or whether it doesn't actually matter. And performance is the only thing that matters.David RobertsSo let's talk then about judging what's a good and bad model, because another good point you make, or I think you borrow, is that the only way to judge a model, basically, is relative to a purpose. Whether it is adequate to the purpose we're putting it to, there's no amount of sort of cleanliness of data or like cleverness of rules. Like nothing in the model itself is going to tell you whether the model is good. It's only judging a model relative to what you want to do with it. So say a little bit about the notion of adequacy to purpose.Erica ThompsonYeah. So this idea of adequacy for purpose is one that's really stressed by a philosopher called Wendy Parker, who's been working a great deal with climate models. And so, I guess, the thing is that what metric are you going to use to decide whether your model is any good? There is no one metric that will tell you whether this is a good model or a bad model. Because as soon as you introduce a metric, you're saying what it has to be good at.I can take a photograph of somebody. Is it a good model of them? Well, it's great if you want to know what they look like, but it's not very good if you want to know what their political opinions are or what they had for dinner. And other models in exactly the same way. They are designed to do certain things. And they will represent some elements of a system or a situation well, and they might represent other elements of that situation badly or not at all. And not at all doesn't really matter because it's something that you can't sort of imagine it in. But if it represents it badly, then it may just be that it's been calibrated to do something else. So the purpose matters.And when you have a gigantic model, which might be put to all manner of different purposes. So a climate model, for example, could be used by any number of different kinds of decision makers. So the question, "Is it a good model?" Well, it depends whether you are an international negotiator deciding what carbon emissions should be or whether you're a subsistence farmer in Sub-Saharan Africa or whether you're a city mayor who wants to decide whether to invest in a certain sort of infrastructure development or something or whether you're a multinational insurance company with a portfolio of risks. You will use it in completely different ways.And the question of whether it is any good doesn't really make sense. The question is whether it is adequate for these different purposes of informing completely different kinds of decisions.David RobertsRight, or even if you're just thinking about mitigation versus adaptation, it occurs to me, different models might work better for those things. I guess the naive thing to think is, if you find one that's working well for your purpose that means it is more closely corresponding to reality than another model that doesn't work as well for your purpose. But, really, we don't know that. There's just no way to step outside and get a view of it relative to reality and ever really know that.Erica ThompsonYeah and reality kind of has infinitely many dimensions so it doesn't really make sense to say that it's closer. I mean, it can absolutely be closer on the dimensions that you decide and you specify. But to say that it is absolutely closer, I think, doesn't actually make sense.David RobertsRight, yeah. The theme that's running through the book over and over again is real epistemic humility.Erica ThompsonYes, very much so.David RobertsWhich I think...you could even say it's epistemically humbling the book. That's sort of the way I felt about it.Erica ThompsonGreat. That's really nice. I'm glad to hear that.David RobertsYeah, at the end, I was like "I thought I didn't know much and now I'm quite certain I know nothing at all."Erica ThompsonBut not nothing at all. I mean, hopefully, the way it ends is to say that we don't know nothing at all, we shouldn't be throwing away the models. They do contain useful information. We've just got to be really, really careful about how we use it.David RobertsYes, there's a real great quote, actually, that I almost memorize is, "We know nothing for certain, but we don't know nothing," I think is the way you put in the book, which I really like. We're going to get back to that at the end, too. So another sort of fascinating case study that you mentioned, sort of anecdote that you mentioned that I thought was really, really revealing about sort of the necessity of human expert judgment in getting from the model to the real world is this story about the Challenger shuttle and the O-rings. The shuttle had flown test flights, several test flights beforehand using the same O-rings.Erica ThompsonYes.David Roberts...and had done fine. So there's sort of two ways you can look at that situation. What one group argued was: "A shuttle with these kind of O-rings will typically fail. And these successful flights we've had are basically just luck." Like, we've had several flights cluster on one side of the distribution, on the tail of the distribution and we can't rely on that luck to continue. And the other side said, "No, the fact that we've run all these successful flights with these O-rings is evidence that the structural integrity is resilient to these failed O-rings to the sort of flaws in the O-rings."And the point of the story was: both those judgments are using the exact same data and the exact same models. And both judgments are consonant with all the data and all the models. So, the point being, no matter how much data you have—and even if people are looking at the same data and looking at the same models—in the end, there's that step of judgment at the end. What does it mean and how does it translate to the real world that you just can't eliminate, you need, in the end, good judgment.Erica ThompsonYeah, exactly. You can always interpret data in different ways depending on how you feel about the model. And so another example I give that is along very similar lines is thinking, sort of, if you were an insurance broker and you'd had somebody come along and sell you a model about flood insurance or about the likelihood of flooding. And they said a particular event would be pretty unlikely. And you use that and you write insurance. And then the following year, some catastrophic event happens and you get wiped out. What do you do next? Do you say, "Oh dear. It was a one-in-a-thousand-year event, what a shame. I'll go straight back into the same business because now the one-in-a-thousand-year event has happened."David RobertsRight. It's perfectly commensurate with the model.Erica ThompsonIt's perfectly commensurate with the model, exactly. So do I believe the model and do I continue to act as if the model was correct or do I take this as evidence that the model was not correct and throw it out and not go back to their provider and maybe not write flood insurance anymore?David RobertsRight.Erica ThompsonAnd those are perfectly...either of those would be reasonable. If you have a strong confidence in the model, then you would take option A and if you have low confidence in the model, you take option B. But those are judgments which are outside of "model land."David RobertsRight, right. Judgments about the model itself. And it just may be worth adding that, there is no quantity of data or like detail in a model rules that can ever eliminate that judgment at the end of the line, basically.Erica ThompsonYeah, because you have to get out of "model land." I mean, now some parts of "model land" are closer to reality than others. So if we have a model of rolling a dice, right, you expect that to give you a reliable answer, quantitative. If you have a model of ballistic motion or they're taking astronauts to the moon and back, you expect that to be pretty good because you know that it's good because it's been good in the past. And there is an element of expert judgment because you're saying that my expert judgment is that the past performance is a good warrant of future success here. But that's a relatively small one and one that people would generally agree on. And then when you go to these more complex models and you're looking out into extrapolatory situations, predicting the future and predicting things where the underlying conditions are changing, then the expert judgment becomes a much bigger and bigger and bigger part of that.David RobertsYes. And that gets into the distinction between sort of modelers and experts, which I want to talk about a little bit later, too. But one more sort of basic concept I wanted to get at is this notion of performativity, which is to say that models are not just representing things, they're doing things and they're affecting how we do things and they're not just sort of giving us information there, they're giving us what you call a "conviction narrative." So maybe just talk about performativity and what that means.Erica ThompsonYeah, so the idea of performativity is about the way that the models are part of the system themselves. So if you think about a central bank, if they were to create a model which made a forecast of a deep recession, it would probably immediately happen because it would destroy the market confidence. So that's a very strong form of performativity. Thinking about climate models, of course, we make climate models in order to influence and to inform climate policy. And climate policy changes the pathway of future emissions and changes the outcomes that we are going to get. So, again, the climate model is feeding back on the climate itself.And the same, of course, with pandemic models which were widely criticized for offering worst-case scenarios. But obviously the whole point of predicting a worst-case scenario isn't to just sit around twiddling your thumbs and wait for it to come true, but to do something about it so that it doesn't happen. I suppose, technically, that would be called "counterperformativity" in the sense that you're making the prediction, and by making the prediction, you stop it from coming true.David RobertsExactly. We get back, again, to, like, models can't really model themselves. It's trying to look at the back of your head in a mirror, ultimately there's an incompleteness to it. But I found this notion of a conviction narrative. I found the point really interesting that in some sense, in a lot of cases, it's probably better to have a model than to not have one, even if your model turns out to be incorrect. Talk about that a little bit. Just the way of the uses of models outside of sort of their strictly kind of representational informational.Erica ThompsonYeah, okay. So I guess thinking about this kind of performativity, and maybe counterperformativity, of models helps us to see that they are not just prediction engines. We are not just modeling for the sake of getting an answer and getting the right answer. We are doing something, which is much more social and it's much more to do with understanding and communication and generating possibilities and understanding scenarios and talking to other people about them and creating a story around it. And so that's this idea of a conviction narrative.And what I've sort of developed in the book is the idea that the model is helping us to flesh out that conviction narrative. So, "conviction" because it helps us to gain confidence in a course of action, a decision in the real world, not in "model land." It helps us to...and then "narrative" because it helps us to tell a story. So we're, sort of, telling a story about a decision and a situation and a set of consequences that flow from that. And in the process of telling that story and thinking about all the different things, whatever you happen to have put into your model, and you're able to represent and you're able to consider within that, developing that story of what it looks like and developing a conviction that some particular course of action is the right one to do, or that you'll be able to live with it, or that it is something that you can communicate politically and generate a consensus about.David RobertsRight. And very frequently those things are good in and of themselves, even if they're inaccurate. You talk about some business research, which found that sort of like businesses with a plan do better than businesses without a plan. Even sometimes that the plan, it's not a particularly good plan, just because having a plan gives you that...just kind of a structured way of approaching and thinking about something.Erica ThompsonYeah. And so maybe this is one of the more controversial bits of the book, but I talk about, for example, astrology and systems where if you're a scientist like me, you will say, "Probably there is no predictive power at all in an astrological forecast of the future." Okay. Opinions may differ. I personally think that, essentially, they are random.David RobertsI think you're on safe ground here.Erica ThompsonI think so. Probably with your audience, I am. But the point is that doesn't make them totally useless. So they can have genuinely zero value as prediction engines, but still be useful in terms of helping people to think systematically about possible outcomes, think about different kinds of futures, think about negative possibilities as well as positive ones, and put all that together just into a more systematic framework for considering options and coming to a course of action.David RobertsRight, or think about themselves.And think about themselves and their own weaknesses and vulnerabilities as well as strengths. Yeah, absolutely. It gives you a structure to do that. And I think that is absolutely not to be underestimated. Because there's sort of those two axes. There's the utility of prediction, the accuracy of prediction: "How good is this model as a predictor of the future?" And then, completely orthogonally to that, there is: "How good is this model, in terms of the way that it is able to integrate with decision making procedures? Does it actually help to support good decision making?" And you can imagine all four quadrants of that.Erica ThompsonObviously, we sort of hope that models that are really good at predicting the future will be really good at helping to support decision-making. But, ultimately, if it could perfectly predict the future and it was completely deterministic and it just told you what was going to happen, that wouldn't be much use either. You're back into sort of Greek myths and Greek tragedies, actually being told your future is not that useful. You need to have some degree of uncertainty in order to be able to have agency and take action and have the motivation to do anything at all.David RobertsYeah, so I guess I would say that astrological, astrology wouldn't have hung around for centuries, despite having zero predictive power.Erica ThompsonIf somebody didn't find it useful.David RobertsRight, if it did not have these other uses. I just thought that was a little bit sort of tacking the other way from a lot of the points, a lot of the points you're making in the book about the sort of weaknesses or limitations of models, et cetera, et cetera. But this was a point, I thought, where you sort of make the counterpoint that, it's almost always better to have a model than no model, it's better to have some...Erica ThompsonWell, maybe. It depends what it is and it depends whose model it is and it depends what the agenda is of the person who's providing the model. And you can maybe take sort of both lessons from the astrology example because I think you can find good examples in the past of sort of vexatious astrologers or astrologers with their own hidden agendas. Giving advice, which was not at all useful or which was useful to themselves, but not to the person who commissioned the forecast.David RobertsYes. Or like the king deciding whether to invade a neighboring country or something.Erica ThompsonRight, yeah.David RobertsNot great for that. So given all these—and we've just really skated over them, there's a lot more to all these—but given these sort of limitations of mathematical models, this sort of inevitable uncertainty about whether you're including the right kinds of information, whether you're waiting different kinds of information well, whether past performance is an indicator of future performance, all these sort of limitations and the need for expert judgment all, to my mind, leads to what I think is one of your key points and one of the most important takeaways, which is the need for diversity. Diversity, I think, these days has kind of...the word conjures is sort of representational feel-good thing.We need to have a lot of different kind of people in the room so we can feel good about ourselves and everybody can see themselves on the TV or whatever. But you're making a much more...very practical, epistemic point about the need for diversity of both models and modelers. So start with models. What would it mean to...like if I'm trying to forecast the future of the severe climate events, I think the naive, a naive sort of Western way of thinking about this would be: you need to converge on the right model, the one that is correct, right. The one that represents reality. And your point is: you never reach that. And so in lieu of being able to reach that, what works better is diversity. So say a little bit about that.Erica ThompsonYeah, that's exactly it. So, I suppose the paradigm for model development is that you expect to converge on the right answer, exactly. But I suppose what I'm saying is that because there can't—for various mathematical reasons—be a systematic way of converging on the right answer, because essentially because model space has infinitely many dimensions—go into that in a bit more detail for the more mathematically inclined—but because we don't have a systematic way of doing that, the statistics don't really work. So if you have a set of models, you can't just assume that they are independent and identically distributed, sort of throws at a dartboard and we can't just average them to get a better answer.So the idea of making more models and trying to sort of wait for them to converge on this correct answer just doesn't actually make much sense. We don't want to know that by making more similar models, we will get the same answer and the same answer again and the same answer again. Actually, what we want to know is that no plausible model could give a different answer. So you're reframing the same question in the opposite direction. What would it mean to convince ourselves that no plausible model could give a different answer to that question. Well, instead of trying to push everything together into the center and, by the way, that's what the models that are submitted to the IPCC report, for example, do. They tend to cluster and to try to find consensus and to push themselves sort of towards each other. I'm saying we need to be pushing them away.David RobertsYou talk about this drive for an Uber model, the, whatever the CERN of climate models, this push among a lot of climate models to find the sort of ER model, the ultimate model, and you are pushing very much in the other direction.Erica ThompsonYeah, I mean, that has a lot to commend it as a way to sort of systematize the differences between models rather than the ad hoc situation that we have at the moment. So I don't completely disagree with Tim Palmer and his friends who say that sort of thing. It's not a silly idea, it's a good idea, but I think it doesn't go far enough because it would help us to quantify the uncertainty within "model land," but it doesn't help us to get a handle on the uncertainty outside "model land," the gap between the models and the real world. And so what I'm saying is that if we want to convince ourselves that no other plausible model could give a different answer, then we need to be investigating other plausible models.Now the word "plausible" is doing a huge amount of work there and actually then that is the crux of it is saying, well, how can we, as a community, define what we mean by a plausible model? Do we just define it sort of historically by...stick with climate for a minute. We've started with these models of atmospheric fluid dynamics and then we've included the ocean and then maybe we've included a carbon cycle and some vegetation and improved the resolution and all that sort of thing. But couldn't we imagine models which start in completely different places that model the same sorts of things?And if you had got a more diverse set of models that you considered to be plausible and you found that they all said the same thing, then that would be really, very informative. And if you had a set of plausible models and they all said different things, then that would show you perhaps that the models that you had, in some sense, had a bit of groupthink going on, that they were too conservative and they were too clustered. And I do have a feeling that that is what we would find if we genuinely tried to push the bounds of the plausible model structures.Now, actually, then you run into the question of plausible, and that's a difficult one, because now we're into sort of scientific expertise. Who is qualified to make a model? What do we mean by "plausible"? Which aspects are we prioritizing? And then we introduce value judgments. We say you have to be trained in physics or you have to have gone to an elite institution, you have to have x many years of experience in running climate models. You have to have a supercomputer. And all of these are, sort of, barriers to entry to have a model which can then be considered within the same framework as everybody else's. So this is another...then the social questions about diversity start coming up, but I start with the maths and I work towards the social questions. I think that we can motivate the social concerns about diversity directly in the mathematics.David RobertsRight, so you want a range of plausible models that's giving you...so you can get a better sense of the full range of plausible outcomes. But then you get into plausibility, you get into all kinds of judgments and then you're back to the modelers.Erica ThompsonExactly.David RobertsAnd you make the point repeatedly that the vast bulk of models used in these situations, in climate and finance, et cetera, are made by WEIRD people. I'm trying to think of the Western... you tell me.Erica ThompsonYeah, never quite sure exactly what it stands for. I think it's Western, Educated, Industrialized, Rich, and Developed, something like that. I suppose it's used to refer to the nation rather than the individual person. But it's the same idea.David RobertsRight. The modelers historically have been drawn from a relatively small...Erica ThompsonFrom a very small demographic of elite people. Yeah, exactly.David RobertsAnd I feel like if there's anything we've learned in the past few years, it's that it is 100% possible for a large group of people drawn from the same demographic to have all the same blind spots and to have all the same biases and to miss all the same things. So, tell us a little bit about the social piece, then, because it's not like the notion that you should have a degree or some experience with mathematical models to make one and weigh in on them. It's not...Erica ThompsonIt's not unreasonable.David RobertsCrazy, right. How would we diversify the pool of modelers?Erica ThompsonSo that's what I mean, it's a really difficult question because it's what statisticians would call a "biospherians trade-off." You want people with a lot of expertise, relevant expertise, but you don't want to end up with only one person or one group of people being given all of the decision-making power. So how far, sort of, away from what you consider to be perfect expertise do you go? And I suppose there may be the first port of call is to say, well, what are the relevant dimensions of expertise? And you can start with perhaps formal education in whatever the relevant domain is, whether it's public health or whether it's climate science.But I think, then, you have to include other forms of lived experience, you know, and I don't know what the answer looks like. You know, I say in the book as well, what would it look like if we were to get some completely different group of people to make a climate model or to make a pandemic model or whatever. It would look completely different. Maybe it wouldn't even be particularly mathematical or maybe it would be, but it would use some completely different kind of maths. Maybe it would be, you know, I just don't know because actually I'm one of these WEIRD, in inverted commas, people, myself. I happen to be female, but in pretty much every other respect, I'm as sort of standard modeler-type as it comes. So I just don't know what it would look like. But I think we ought to be exploring it.David RobertsAs I think through the sort of practicalities of trying to do that, I don't know, I guess I'm a little skeptical since it seems to me that a lot of what decision makers want, particularly in politics, is that sense of certainty. And I'm not sure they care that much if it's faux certainty or false certainty or unjustifiable certainty. It is the sort of optics and image of certainty that they're after. So if you took that out of modeling, if the modelers themselves said, "Here's a suite of possible outcomes, how you interpret this is going to depend on your values and what you care about," that would be, I feel like, sort of, epistemologically more honest, but I'm not sure anyone would want that. The consumers of models, I'm not sure they would really want that.Erica ThompsonBut it's interesting. You say that that's a reason not to do it, I mean, surely that's a reason to do it. If the decision makers are, sort of, somewhat dishonestly saying, "Well actually I just want a number so that I can cover my back and make a decision and not have to be accountable to anyone else. I'm just going to say, 'Oh, I was following the science of course.'"David RobertsRight.Erica ThompsonWell, that sounds like a bad thing. That sounds like a good reason to be diversifying, and that sounds like a good reason not to just give these decision-makers what they say they want.There are maybe better arguments against it in terms of...is it even possible to integrate that kind of range of possible outputs into a decision making process? Like would we be completely paralyzed by indecision if we had all of these different forms of information coming at us? But I don't think that, in principle, it's impossible. For example, I would say that near-future climate fiction is just as good a model of the future as the climate models and integrated assessment models that we have. I would put it, kind of, not quite on the same level, but pretty close.David RobertsHave you read "The Deluge" or have you heard of "the Deluge"?Erica ThompsonI've not read that one, no. I was thinking of maybe Kim Stanley Robinson's "Ministry for the Future." But other explorations of the near-future are available.David RobertsRight. I've read both. I just really have to recommend "The Deluge" to you. I just did a podcast with the author last week and it's a really detailed 2020 to 2040 walking through year-by-year. And, obviously, fiction is specific, right? So there's specific predictions, which are scientifically, sort of, you'd never let a scientist do that.Erica ThompsonBut you can explore the social consequences and you can think about what it means and how it actually works, how it plays out in a way that you can't in a sort of relatively low-dimensional climate model. You can draw the pictures, you can draw the sort of red and blue diagrams of where is going to be hot and where is going to be a bit cooler. But actually thinking about what that would look like and what the social consequences would be and what the political consequences would be and how it would feel to be a part of that future. That's something that models, the mathematical kind of models can't do at all. That's one of their...that's one of the axes of uncertainty that they just can't represent at all. But climate fiction can do extremely well.David RobertsYeah, I was going to say that book got me thinking about these things in new ways, in a way that no white paper or new model or new IPCC ever has.Erica ThompsonExactly. But if you're thinking of the models as being, sort of, helping to form conviction narratives and they are sort of ways of thinking about the future and ways of thinking collectively about the future as well, as well as kind of exploring logical consequences, then in that paradigm, the climate fiction is really, genuinely, just as useful as the mathematical model.David RobertsWell, we've been talking about models in general and they're sort of limitations. So let's talk about climate specifically, because it sort of occurred to me, maybe this isn't entirely true, but like the epidemiological thing and the finance thing, both, in a sense, models play a big role in there, but there's also a lot of direct experiential stuff going on. But it's sort of like climate has come to us, the thinking public, almost entirely on the back of models, right? I mean, that's almost what it is. You know what I mean? Like you can see a severe weather event, but you don't know that doesn't say climate to you unless you already have the model of climate in your head.So it's the most sort of thoroughly modelized field of sort of a human concern that there is. And so all the kind of dysfunctions that you talk about are very much on display in the climate world. Let's just start by pointing out, as you do, the sort of famous models that have been used to represent climate. DICE; William Nordhaus's DICE model is famous. One of the earliest and famous. One of the things it's famous for is him concluding that four degrees—right there is the perfect balance of mitigation costs and climate costs. That's the economic sweet spot.And of course, like any physical scientist involved in climate who hears that, who's just going to fall out of their chair. Kevin Anderson, who you cite in your book, I remember almost word for word this quote of his in a paper where he basically says, "Four degrees is incommensurate with organized human civilization." Like, flat out. So that delta. tell us how that happened and what we should learn from that about what's happening in those DICE-style models.Erica ThompsonWell, I think we should learn not to trust economists with Nobel Prizes. That's one starting point.David RobertsI'm cheering.Erica ThompsonGood.David RobertsI'm over here cheering.Erica ThompsonSo, yeah, what can we learn from that? I mean, I think we can learn, maybe, for a starting point, the idea of an optimal outcome is an interesting one. Who says that there is an optimal? How can we even conceptualize trading off a whole load of one set of bad things that might happen with another set of bad things that might happen?David RobertsImagine all the value judgments involved in that!Erica ThompsonExactly, exactly, exactly. You're turning everything into a scalar and then optimizing it. I mean, isn't...that weird, if anything?David RobertsYes. And you would think, like, how should we figure out how we value all the things in our world? Well, let's let William Nordhaus do it.Erica ThompsonYes.David RobertsIt's very odd when you think about it.Erica ThompsonYou can read many other, even better critiques of Nordhaus's work and, sort of, thinking about these different aspects of how the values of outcomes are determined and how things are costed, and of course, as he's an economist, everything is in dollars, so it's the sort of least-cost pathway is the optimal one. So it may indeed be that the lowest financial cost to global society is to end up at four degrees, but that will end up with something that looks very strange. Maybe there will be a lot more zeros in bank accounts. Great, fine. But is that really what we care about?David RobertsRight. How many zeros compensate for the loss of New Orleans or whatever?Erica ThompsonExactly. The loss of species across the planet and coral reefs and all the rest of it? I think even the concept that you can put these things on a linear scale and subtract one from the other just doesn't make sense.David RobertsAnd also, one of the amusing features of these models that you point out—which I have obsessed over for years—is, they sort of assume, as a model input, that the global economy is going to grow merrily along at 3% a year forever. And then and then, you know, I have arguments with people about the effects of climate change and they say, "Well, you know, it's not going to be that big a deal. The economy is going to keep growing." And I'm like, well, "How do you know that?" And they're like, "Well, that's what the model says." And I'm like, "Well, yeah, that's because you put it in the model!" Like, you can't put it in there and then go later, go find it there and say, "Oh, look what we found, economic growth." And they sort of they hold that 2% growth steady and then just subtract from that, whatever climate does. And the whole notion that...Erica ThompsonI mean, the notion, I think everything is predicated on marginal outcomes, that, as you say, everything will just continue as it is, and climate change is only an incremental additional subtraction on top of that. I think for anyone who has really thought through—and perhaps we need to be sending these economists some more climate fiction so that they can start thinking through what the systemic impacts are of climate change.Because yes, I can sort of see that if you thought climate change was only going to be about the weather changing slightly in all the different places, that you would say, "Well, what's the big deal? The weather will change a bit and it'll be maybe a bit hotter there and a bit wetter there and a bit drier there, and we'll just adapt to it. You just move the people, and you change your agricultural systems and grow different crops and raise the flood barriers a bit." And all of those have a cost, and you just add up the cost and you say, "Well, actually, we'll be able to afford it. It'll be fine." So I can sort of understand how they ended up with that view. And yet, as soon as you start thinking about any of the social and political and systemic impacts of anything more than very trivial perturbations to the climate, it just becomes impossible to imagine that any kind of incremental model like that makes any sense at all.And yet this is sort of state-of-the-art in economics, which is really disappointing, actually. It would be really nice to see more.David RobertsYou don't even need to send them climate fiction. As you say in that chapter, even if they just went and talked to physical scientists, if you just ask physical scientists or sociologists or people from outside kind of the economic modeling world, "What's your expert sense of what's going to happen?" None of them say, "Steady economic growth as far as the eye can see, with the occasional hiccup."Erica ThompsonYeah. So I think economics has become sort of wildly detached from physical reality somehow, and I'm not quite sure how it happened. And, you know, there are good people within the economics profession fighting against that tide, but it seems very hard to counter it. Nordhaus was getting his Nobel Prize in 2018, which is only five years ago.David RobertsYes. Another quote that grabbed me is, in the sense of, we don't know how to assign probability to some of these, sort of, big kind of phase shift things that might happen, tipping points or whatever you call them, or social tipping points. We don't know how to assign probabilities to these things and so we don't put them in the model. And so then the model tells us, "Don't worry, these things aren't going to happen." But as you say, "Absence of confidence is not confidence of absence."Erica ThompsonExactly.David RobertsAnd one point you make, your general point about climate models is that they sort of represent a failure or several failures of imagination. But as you say, making the models this way so they only show marginal changes, so they basically show the status quo out to the indefinite future with just 1% or 2% of GDP growth shaved off. It's not benign to do the model that way because in the model feeds back and affects how we think about the future. The failure of imagination going into the model then comes back out of the model and creates a failure of imagination.This gets back to the sort of models not just being predictive engines, but being narratives, stories, ways of thinking.Erica ThompsonYeah, these models change how we make climate policy. They change how we think about the future. They change the decisions that we make. They frame the way that we think about it. And so, I think when we have economic models that say, "Four degrees is optimal." or when we have climate models that sort of, I think, are not to the same extent, but somewhat guilty of doing the same thing, of projecting a future which looks much like the past, but with marginal changes.I think maybe modelers, physical modelers are becoming more confident about the possibility of more radical change in the physical system as well. It was interesting to see the change in language around the Atlantic meridian overturning circulation, for example, the Gulf Stream, which is such a big influence on the climate of Northern Europe. And of course, it's also because it transfers heat from the Southern Hemisphere to the Northern Hemisphere. If that were to change, it would be a huge change to the climate of the Southern Hemisphere as well. So it's not solely a European concern.But I think models over the past sort of 20-30 years have been...again, it's sort of this trying to find consensus and trying to look like the other models. And I wouldn't say it's necessarily deliberate. It's just sort of you run a model and you find that it does something a bit weird. So you go back and you tweak it, and you do something a bit different, and you try and get it to look more like the other models. Because you think that if all the other models say something, then that must be sort of what we're expecting. And we don't want to look too far out, otherwise, maybe we won't get included in the next IPCC report.David RobertsRight. And if you're averaging out, it's the discontinuities and the sudden breaks that kind of get thrown overboard if you're trying to...Erica ThompsonExactly. And you start saying, "Well, this one's an outlier, so maybe we won't include it in the statistics. Or this one, it just doesn't look physically plausible." And of course, anything, as soon as you start looking into the details, you're going to be able to say it's wrong or you're going to find a bug or something because it's wrong everywhere, because all models are wrong. But that shouldn't be a problem because we make models, knowing that we are making a simplification.But if we investigate the ones that are more far out, with more zeal to look for these errors and problems, we will find a reason to discount them. So that is statistically worrying, because we should have to sort of preregister our model runs and say, "Actually, I'm going to run this set of model runs with these sets of parameters, and it doesn't matter what the output looks like. I'm going to consider those all to be equally likely." Because if you start going back and pruning them, with respect to your expert judgment about what it ought to look like, then you'll end up with a distribution that looked like what your preconception was, not like what the model was telling you.David RobertsYeah, it's one thing to say any given sort of discontinuity or outlier might be statistically unlikely, but to me nothing's more statistically unlikely than 80 years of human history with no discontinuities and no sharp breaks and no wiggles in the lines of smooth curves. And another way, this way of modeling sort of turns around and affects us is, as you say, as we are forming policy. And, I guess I had had this in my head, but I thought you crystallize it quite well, which is that if you look at these models, these climate economic models...if you look at the ones where climate change gets solved—right, it's just sort of the steadily increasing curve of solar and the steadily increasing curve of wind and everything sort of just like marginally inches up to where it needs to be—when you think about it, that representation excludes radical solutions. It excludes everything, really, but price tweaks.Erica ThompsonYes, because that's the way these models are made. They are cost-optimizing models, which are entirely determined by the price that you happen to set. And so the integrated assessment models that we're talking about, they include costs on different energy system technologies. So a cost for nuclear and a cost for renewables and a cost for anything else you want to put in. And depending on what it costs, it will rely more or less on that particular technology. But of course, behavior change could just as well be put in.How much would it cost in dollars per ton of carbon avoided to change people's behavior so that you use less electricity, for example? Maybe we're starting to see that with all the stuff about, you know, conserving energy in light of the Ukrainian crisis, but how much would that cost? And it would be completely arbitrary to say how much it would cost, because it's so dependent on social and political whims and the winds of change and the trends in society. It doesn't really make sense to try and put a price on it because it would depend on how it's framed and who's doing it and all of that.David RobertsRight. Or like, what is the dollar value of a social uprising that results in social democracy like that? How do you price that?Erica ThompsonAnd also on the technologies. I mean, I'm sure you've discussed this before on your podcast, but the cost of carbon capture and storage, how much is that going to influence the pathways that we have? And you see the pathways more and more are dependent on a lot of carbon capture at the end of the century in order to make everything balance out. If you put it in with a high cost, then you won't use it. If you put in with a low cost, you'll use loads of it.And then is that performative or is it counterperformative? Is it the case that the policymakers look at it and say, "We're going to need loads of this interesting technology and we don't have it yet, I'd better put loads of money into investing and developing it." Or do they look at it and say, "Oh, this means that the economic forces that are acting in the climate domain mean that it will be highly economic to do air capture at the end of the century and therefore governments don't need to do anything and we'll just wait and it will happen because it's determined by the market." Which way are they thinking? I have no idea.David RobertsRight.Erica ThompsonBut those are really different, and they result in really different futures. They don't result in the future that was predicted.David RobertsRight. This gets to moral hazards and model hazards, which I hope you can segue into here because I found that those two concepts also quite helpful.Erica ThompsonSo the next one I think that is going to end up in these models is geoengineering, for example. And so you could equally well put into the same model with the same framework. It would be then in terms of sort of either dollars per ton of carbon equivalent in the atmosphere, but negative for the amount of shading that you could get for a certain amount of stratospheric aerosol injection or whatever your favorite technology is, but you could, in principle, stick that in.And what is the price that you're going to put on it? If you put it in at $2,000 per ton of CO2, it's not going to happen. If you put it in at $2 per ton of CO2, it's going to be totally relied on and it will be the linchpin of all successful trajectories that meet the Paris targets by 2100. And if you put it in somewhere in between, you'll get more or less of it, depending on that price point. So who decides what price point it's going to go in at?David RobertsYes, and you really capture the sort of oroboros nature of this. So we add up all the technologies we have, there's a hole left, we say we're going to carbon capture that hole. That's how we're going to fill that hole in our mitigation. And then we turn around and look at the model where we stuck this arbitrary amount of carbon capture in and turn around and say, "Oh, well, we have to do carbon capture because that's what the model said is needed." And again, it's like, wait a minute, you went and put that label on the hole in the model?"Erica ThompsonYes.David RobertsAnd then you went in and found it in the model and are now claiming that the model is telling you you have to do this, but it just says you have to do this because you're hearing an echo of your own decisions.Erica ThompsonExactly. But I think, more generally, that's what these models are doing for us. They encapsulate a set of expert judgments and opinions and they put them into a mathematical language. But that doesn't make them any more objective. It perhaps makes them slightly more logically self-consistent with the different numbers that have got to chime with each other, but it doesn't actually make them any more authoritative and objective than if they were just written down or spoken.David RobertsWell, it insulates them.Erica ThompsonIt insulates them from criticism.David RobertsPublic scrutiny.Erica ThompsonYes, absolutely.David RobertsIt gives them the vibes of expertise that daunts people and keeps people away.Erica ThompsonYes.David RobertsAnd so carbon capture right now is playing that role. We just sort of decided arbitrarily we need x amount of carbon capture because that's how much mitigation we have left to do that we don't know how to do with other sources. And we're arbitrarily deciding on the price of carbon capture because we don't know what that price is because it doesn't really exist at scale yet. So we're making these arbitrary decisions.Erica ThompsonExactly. It was going to be renewables and renewables weren't fast enough, so then it had to be something else. And then it was going to be carbon capture and storage and that wasn't quite enough. So now it's direct air capture and next it's going to be geoengineering. I mean, I can't see another way around that. That is the trajectory that these models are taking. And once the geoengineering is in the models, then it will become a credible policy option, an alternative. So we need to be ready for that.David RobertsWell, this point you're making so disturbed me that I wrote the whole quote down from the book. You say, "If the target of climate policy remains couched in the terms of global average temperature, then stratospheric aerosol geoengineering seems to be now to be an almost unavoidable consequence in its inclusion and integrated assessment models will happen in parallel with the political shift to acceptability." That's just super disturbing. So we're just sort of assuming a can opener to fill these holes in our models and then we're finding a can opener in our model, and we're like, "oh my god, we got to go build."Erica ThompsonYes. And so this is why I think it's so important that we move the discussion from technology and away to values. I think that stratospheric aerosol injection could be a perfectly legitimate and reasonable solution, but it must be one that we've talked about, and it must be one that we understand what value judgments are being made. What trade offs are being made? What kind of solutions are being ignored in favor of doing this technological thing? What kind of other options are favored by different people and different kinds of people?Because geoengineering, the sort of big, sexy technological project, is a very tech bro solution. It's a very top-down, mathematical elitist, predict, and optimize...it's in the same vein as all of these economic things. It's about optimization and calculation.David RobertsI always think about the guy who wanted to blow up a nuclear bomb on some Alaska coast to make a better harbor.Erica ThompsonYeah, right. So it's about one-dimensional outcomes. If you say, "All we want is a harbor." Okay, go ahead and do the nuclear bomb, because it will achieve your objective. And if literally the only objective of climate policy is to keep global average temperature below two degrees, then geoengineering will probably be the most cost effective and easy way to do that. But, it is not the only thing that matters. The future of global democracy, the values of different citizens. What kind of future are we trying to get to? So I think this is another problem of the way that we typically model, is that it starts with an initial condition of where we are now, and then everything spreads out and everything becomes more uncertain as you look forward in time.And that kind of leaves people twisting in the wind, wondering, well, what is this future going to look like? We just don't know. It's really uncertain. It's really scary. It could be this, it could be that. It could be catastrophe. And actually, I think politically and in terms of thinking maybe more in conviction narratives, what we need to be doing is coming up with a vision for 2100, articulating a vision for what the future would look like if we had solved the problem that we have.And it's not just climate change. It's resource scarcity, and it's sociopolitical questions. And ultimately, it's a much bigger, kind of almost theological question about how humanity relates to the planet that we happen to find ourselves on. You know, these are big, big questions, and they're not technical questions. They're social and political and spiritual questions about what we're doing here and what we want society to look like. And so, if you if you had a vision of the future, of what you want 2100 to look like and how people should be living with each other and how, politically, we should be thinking about our problems then you say—and then you use your model in a different mode—you say, "If we're aiming for that kind of future, what do we have to do one year from now, five years from now, ten years from now, thirty years from now, in order to stay on track for that future that we want?"Rather than just saying, "We are starting here from this initial condition, and we have all these possible outcomes, possible trajectories kind of diverging forward from us." That's a really...much harder sell and it's harder to communicate. And I think it lends itself towards this one-dimensional thinking of saying, "We have global mean temperature is the problem." Well, global mean temperature is not really the problem. Geopolitics is the problem.David RobertsNobody lives in mean temperature.Erica ThompsonNobody was ever killed by global mean temperature. People are killed by things that happen locally.David RobertsAnd if you're envisioning the 2100 you want, nobody's envisioning a global mean temperature.Erica ThompsonBut people may be envisioning very different things. And then I think it is interesting to listen to some of the people who might call themselves climate skeptics. What is it that they're afraid of? It's sort of authoritarian global government and all that sort of thing. And is that, in fact, what climate models and the larger scale modeling community are kind of being shepherded into propping up? I mean, what is it, politically, that is convenient about this kind of model as opposed to another kind of model or another kind of way of thinking about the future and orienting ourselves towards the future?David RobertsThis is, I think, something the book conveys really well is that if you think about adequacy to purpose and you think about, "Well, what is the purpose?" And the purpose of achieving a desired sociopolitical outcome in 2100 is very different than the goal of achieving average mean temperature. But just because you're targeting average mean temperature doesn't mean you you're not making a political statement. The political statement you're making is: "We want to preserve the status quo." Right? We want everything to stay the way it is with a few tweaked parameters. I'm sure the modelers probably wouldn't sort of explicitly say that.Erica ThompsonNo, and I think it's harder to make that argument for climate models than for economic models. You know, the physics of climate is somewhat different from the economics of climate.David RobertsWell, the climate economic models, I mean.Erica ThompsonYeah, the economic models. No, absolutely. And it's all in there in that one-dimensional reduction of everything to costs. If we reduce everything to costs and we say, then actually the amount that African GDP will change by if African GDP decreases by 80% versus American GDP increasing by 20%, maybe that's an adequate trade off. You turn it into something...again, this just doesn't make sense. Like we have to be thinking about the moral and ethical content of these statements.When you say "A dollar is a dollar is a dollar," then actually if you say that and you are happy to trade off 80% of GDP in Sub-Saharan Africa against 20% increase in GDP in Northern Europe or the US, which is what some of these economic models end up effectively doing, that's an enormous ethical judgment and one that I think, if it were made clearer, people simply wouldn't agree with.David RobertsThat's a more elegant way of putting the point that I frequently put bluntly to modelers about this, which is: you could wipe out, I mean, never mind 80% of the GDP, you could just wipe out the entire continent of Africa, and it wouldn't have a very big effect on the course of global GDP. So is that okay? Are we optimized still if we've lost all of Africa?Erica ThompsonThis is one of the successors to Nordhaus. There are other papers in climate economics which take a more, you know, a slightly more realistic view. And so, I was asked for a comment on a paper about, effectively the same thing, the sort of average temperature and the optimal pathways. And so they look and find that an increase of a few degrees would reduce the GDP of Africa by something like 80%. You know, very dramatic. And and you say, "Is this is it remotely credible to think that one could have absolute economic crisis in some of the largest nations on Earth without that having any feedback effect on the rest of the planet?"David RobertsAnd they just meekly accept it. They're like, "Whoa, dang it. Dang it."Erica ThompsonRegardless of whether you consider it ethically acceptable, do you really think that it can happen without any geopolitical implications? Is the billionaire sitting there in the bunker in New Zealand going to be happy with a few extra zeros on the end of their bank account as the world collapses around them? I mean, are they really? I really am interested to know what the kind of thought process is there. Like, I don't quite understand how you come to what seems to be the conclusion that you should be hoarding the resources and then holding up in a bunker in New Zealand.David RobertsOh, my goodness. I don't know if you saw recently the article by David Rothkopf where he was summoned basically to a panel of millionaires.Erica ThompsonOh, yes, I did see that oneDavid RobertsAnd they were asking him questions about their bunkers. And whatever low opinion you might have had of them. It's not low enough. The questions about their bunkers are so naive.Erica ThompsonYeah, it's depressing.David RobertsSo in "model land," in some sense, it's absolutely wild.Erica ThompsonBut this is the economic mentality of saying that "The zeros on the bank account are all that matters and that I am an individual and I am not part of a society and I can thrive regardless of what the rest of the planet looks like." It's that sort of divorce from reality that, somehow, somehow, some group of people—and perhaps it's an extreme version of the mentality of the economists and the economic models that are making these kind of projections and saying that this kind of thing can happen.David RobertsSo, taking your recommendations, I mean, you have at the end of the book, five recommendations for better modeling, and I think people can probably extrapolate some of them from what we've said so far. You bring in more kinds of perspectives. You bring in more different kinds of models, you take outliers more seriously, things like that. But if you did all those things, what you would be doing is stripping away a lot of the kind of faux objectivity that we have now and exposing the fact that there's a hole that can only be filled by expert judgment or by judgment, really, by human judgment.And that is terrifying, I think, to people, particularly people making big decisions that involve lots of people. They're desperate for some sense of something solid to put their back against, right, something that they can reference if they're questioned later about why they made the discussion. So I wonder if in a sense, this is not problems that are arising out of just sort of bad modeling, but in some sense these problems are downstream from a very basic, sociocognitive need for certainty and fear of, sort of, openly exercising judgment and openly defending ethical positions. Do you know what I mean? In some sense, that fear is what produced this situation rather than vice versa.Erica ThompsonYeah, I don't disagree. I think they kind of have gone together and as the models and the idea that the science can give us an answer—and the promise of the scientists that science will be able to give us an answer—as the scientists have kind of gone, "Oh, hey, we could do that. And we could do this. And we could do the other thing as well. And we can give you an answer and just give us a few more million pounds and a better computer and we'll give you more answers and better answers, and then we'll start applying some AI as well, and we'll automate it all." And eventually, you won't even need to think about it. You can just follow the science.David RobertsFollow the science.Erica ThompsonFollow the science. I really don't like, "Follow the science."David RobertsI hate that term so much, I was literally cheering in my bed reading this part. But you say, what to me always seems so obvious, and yet when I try to talk about this on Twitter or in public, I just get the weirdest backlash. But I just want to tell people in the climate world, like, science does not tell you what to do. Quit claiming that we have to do X, Y, and Z because science says so. That's just not the kind of thing that science does!Erica ThompsonScience hopes to be able to tell you, like, in the best case scenario, science can tell you if you do A, this will happen, and if you do B, that will happen. And if you do C, that will happen, but it doesn't have an opinion, in theory, on which of those is the best outcome. Now, in practice, the kind of science that we do and the way that I've sort of described that values and judgments do enter into the modeling process, actually, we do to some extent have an entry of those value judgments into even that beginning section. If A, then what? And if B, then what? And if C, then what?But, you can't get from an "is" to an "ought," you have to introduce value judgments. You have to say, "I prefer this outcome." And ideally, if you're making decisions on behalf of a large group of people, that has to be in some way representative, or at least you have to communicate, "I want this outcome for the following reasons." And so, I would really like to see an IPCC working group for, which is about ethics and value judgment and the politics of climate change, and says, "Well, why is it that people disagree?"Because I think if you go to climate skeptic—again sort of in inverted commas—conferences, or if you talk to them, they are not idiots and they are not uncaring. They tend to be people who genuinely care about the future and about their children's prospects and all the rest of it. And okay, many people find them very annoying, but the point is that their underlying motivation is actually very similar to most other people, and they just have quite different assumptions about either what the future will look like, perhaps misconceptions about the facts as well, in some cases. But a lot of that is motivated by a worry about the political outcomes of what people saying, "follow the science" are telling you to do.David RobertsRight, exactly. And I think they sense, in some ways, almost more than sort of your average kind of lefty climate science believer does, that there are value judgments being smuggled past them undercover of science.Erica ThompsonI mean, it's easier to spot value judgments when they are not your own value judgments, because if they are your own value judgments, then you don't really notice them, you just think it's natural. And so this is another good argument for diversity in modeling, because in order to be able to see these value judgments, they are much more easily uncovered by somebody who doesn't share them.David RobertsEven just to say, "Humanity is worth preserving, we should preserve the human species." That, in itself, is a value judgment.Erica ThompsonYes, a value judgment. Absolutely.David RobertsScience is not telling you you need to or have to do that. I sort of wonder and this is talk about unknowables, but if the IPC did that and really did systematic work bringing all these value judgments, sort of dragging them out of their scientific garb and exposing them to the light and reviewing how different people feel about them, do you feel like that would? Because, I know your average weird science-model bro. His fear about that is, well, if you do that, then everybody will just think they're relative and they can choose whatever they want and, you know, it'll be chaos. But do you think that's true or do you think it would help?Erica ThompsonI don't know whether it would help. I mean, I think I think that it would help to separate the facts and the values because I think people who disagree on the values are because there is no conversation about the values. They are left with the only thing that they can get their hands on is the model and, effectively, the facts, the science. And so they start doing...making sometimes, what are quite reasonable, questions about statistics of model interpretation and, sometimes unreasonable, criticisms about, say, the greenhouse effect.Now, if we could separate that out and say, actually, we agree that the greenhouse effect is a real thing because this is basic physics and actually criticizing that doesn't make any sense. But we will entertain your difference of value judgments about the relative importance of individual liberties and economic growth versus the value of other species or of human equality or whatever, all of these other things. You can stick it all in there and say we allow you to have a different opinion and then maybe we can agree to agree on the facts. So I think it probably wouldn't work, because things are probably too far gone for that to actually result in any form of consensus.But I think if we could sort of bottom that out and say "What is it that you're most scared of?" to everybody. "What is it that you're most scared of losing here?" I think that would be a really revealing question, and I think that would that would also help to incorporate different communities and more diverse communities into the climate conversation because I think then you're into questions about, well, really, what is it that you care about? What are you scared? What future are you most scared of? Are you most scared of a future where society breaks down, in inverted commas? But is it because you're scared of other people? Or is it because you are worried about not having the economic wealth that you currently enjoy?Or is it because you are scared of losing the biodiversity of the planet? Or...there are so many things that people could kind of put in that box.David RobertsOr are you most scared of losing your gas stove?Erica ThompsonYes, that's an interesting one, isn't it? So why has that become such a big thing?David RobertsReally is, right? There's layers to it.Erica ThompsonThere's layers, but there's layers on both sides. I mean, there's the kind of the instinctive, "Don't tell me what to do," but there's also, "Well, why are you telling people what to do? What is the information not sufficient?"David RobertsRight?Erica ThompsonWhat is the kind of knee jerk requirement to regulate versus the knee jerk response against regulation? They're both kind of instinctive political stances.David RobertsYes, and a lot of values...Erica ThompsonWith a whole load of other things tangled up in them. Which, I'm not an American, so I hesitate to go any further than that.David RobertsYes, well, there are layers upon layers that you can even imagine. They're like local political layers. It goes on and on. I'm doing a whole podcast on it and I'm worried how to fit it all into 1 hour. It's just on gas stoves. And I also think...to follow up on the previous point you're making, the model centric-ness of our current climate dialogue and climate policy dialogue, I think just ends up excluding a lot of groups, who have things to say and values. And, you know, the sort of cliche here is the sort of Indigenous groups, you know, they have relationships with the land that are extremely meaningful and involve particular patterns, and those things are of great value. But if they're told at the door quantify this or...Erica ThompsonQuantify this or it doesn't count, yeah.David Roberts...stay out, then they're just going to stay out. So...Erica ThompsonYeah.David Roberts...at the very least it would be a more interesting dialogue if we heard from more voices.Erica ThompsonYeah, but I mean, I think we have to sort of internalize and accept the idea that people with less education, you know, formal education in the sense that sort of we consider there to be a hierarchy of people with more letters after their name are more qualified, and therefore more qualified to inform climate policy and more qualified to have a view on what they think the future should be like. I realize it's a somewhat radical position, but I think that everybody has a valid opinion and a right to an opinion about what they want the future to look like.David RobertsYes, we're just back to...it's funny we're talking about it in the realm of climate but as you say in the book, there's just a million realms of sort of human endeavor, especially collective human endeavor. We're running into these same kind of things. We don't really seem to know how to have honest, transparent arguments about values anymore.Erica ThompsonAnd we find it really hard to talk about values at all. It's really hard, even like if a scientist stands up and says that they love and care about something, that's kind of a weird thing to do. Why would you do that? We're all a bit uncomfortable. You're biased. Exactly.David RobertsBiased in favor of life.Erica ThompsonWhen you start saying that sort of thing, maybe your science is corrupted by it. We can't have that.David RobertsYes, I know. And just like convincing another thing I get yelled at about online just trying to convince people that you are an embedded creature. You have a background, you are socialized to think and feel particular ways, like, you are coming from a place and it's worth being aware of what that place is and aware of how it might be influencing your thinking and aware of other ways...blind spots. and just like people give very...Erica ThompsonAnd aware that some peoples, places, and situations are noticed more than others. If you are a, sort of, white male, well-educated tech bro, then your personal background and situation is not scrutinized the way it is if you are someone "different," in inverted commas, in whatever way that might be.David RobertsAnd the more privilege you have, the more incentive you have to think that your opinions are springing from the operation of pure reason.Erica ThompsonAre "objective" and "neutral."David RobertsWhen your value judgments are "hegemonic," let's say...Erica ThompsonExactly.David RobertsIt's all to your benefit to keep them hidden, right? You don't want them dragged out into the light. Anyway, okay, I've kept you for way longer than I thought I would. As I said, I love this book. There's one more thing I wanted to touch on just briefly, and this is a bit of a personal goof, but I in another lifetime, many, many moons ago, studied philosophy in school. And you slip a line in here early, early in the book when you're talking about what models are and just sort of what you mean by model, and you talk about how they're just ways of structuring experience so that we can make sense of it and predict it.And when you think about it that way, as we said earlier in the conversation, pretty much everything is a model. Like, we're not processing raw data, right? We're filtering from the very beginning through our, sort of, models. And you slip in this line where you say, in this sense, real laws, like, say, speed of light or gravity or whatever are only model laws themselves, which is to say, all our knowledge, even the knowledge we think of as most objective and sort of straightforward and unmediated is in a model. And therefore all the things you say about our relationships with our models and how to do better modeling, it seems to me, all that applies to all human knowledge, right?Erica ThompsonYes. I mean, you're really in the rabbit hole now, but yes. What is it that convinces you that the speed of light is the same today as it will be tomorrow?David RobertsExactly.Erica ThompsonI mean, how do you know? How do you know? What is it that gives you that confidence? I mean, I think you can reasonably have confidence in many of these things. And of course, the mathematics is, as somebody else said, unreasonably effective in the natural sciences. There is no a priori reason to think that it ought to be, so don't worry too much about it. I think that we can make an empirical observation that the laws of physics do work really well for us and that models are and can be incredibly successful in predicting a whole load of physical phenomena and can be genuinely useful and can be calibrated. And we can have good and warranted reliance on those models to make decisions in the real world. So, yes, you're right that, technically, I think there is a problem all the way down, but we do have more confidence in some areas than others.David RobertsWell, this course you're charting between, on the one hand, sort of naive logical positivism, right. That we're just sort of seeing reality, and on the other hand...Erica ThompsonNaive skepticism that says we just can't do it.David RobertsHopeless relativism.Erica ThompsonYes, exactly.David RobertsWe have this middle course, which I associate very strongly with the American pragmatists, James Dewey, and then on and on later into Rorty. I don't know if you ever got into that or studied that, but this sort of practical idea that we know nothing for certain, but we do know things. And to say that we only believe a model because it's worked in the past—and we don't have any sort of absolute metaphysical certainty that it maps on to reality will work again—is not disqualifying like that's just the nature of this is just the nature of human knowledge.Erica ThompsonIt's as good as we can get. You just can't have full certainty.David RobertsBut it works.Erica ThompsonIt works. It's good.David RobertsLike some things work. And something, to me, this is pragmatist epistemology all over again. So I don't know if anybody's ever brought up that parallel with you.Erica ThompsonYeah, I'm not a philosopher, and I'm kind of only tangentially involved with philosophy of science, and there are many different streams of thought within that, but, yes, it sounds very much like that.David RobertsWell, those were all my beloved...that's what I studied back when I studied philosophy, and so a lot of this stuff that you're saying throughout, I was like, "this is not just about mathematical models, this is just about how to be a good, epistemic citizen." Right? How to think well.Erica ThompsonWell, that would make a good subtitle.David RobertsYeah. I thought you might want to rein in a little short of...Erica ThompsonMaybe the next book.David Roberts...of those kind of grand claims. But I really do think that, even people who aren't interested in mathematical modeling as such, can learn from this just about how to have, what's it called, "negative capacity." Just, sort of, a bit of distance from your own models, a little sense that you're not bound up in your own models, the sense that models are always, in some sense, qualified and up for debate and change. I just think it's a good way to go through the world.Erica ThompsonAnd just how to think responsibly about models in society, think critically and think carefully about what it implies to use these models and to have them as important parts of our decision-making procedures. Because they are, and they're going to stay that way, so we need to get used to it, and we need to understand how to use them wisely.David RobertsRight. "Good tools, poor masters," as they say about so many things. Yes, and this is what you kept referencing expert judgment. But I kept coming back again and again throughout the book to the term, "wisdom," which is a little bit fuzzy, but that's exactly what you're talking about. It's just...Erica ThompsonYes, yes it is.David Roberts...accumulated good judgment. That's what wisdom is.Erica ThompsonWisdom and values and understanding, having leaders, I think, who can embody our values and show wisdom in acting in accordance with those values. I think that's something that has kind of gone out of fashion, and I would really like it to see it come back.David RobertsTrue, true. Well, thank you so much. Thanks for coming on and taking all this time. I really, as I say, enjoyed the book, and people are always asking me to read climate change books, and, you know, like, 90% of them are like, "I know all this. Like, you're just telling me things. I know." But I would I would say if I was going to recommend a climate book to people who already know about climate and they're familiar with the science, I would recommend this book because it's, just, how to think about climate change, is one of the most important still, I think one of the most live and important discussions around climate change is just, how do we cognize this? Like, how do we act in the face of this? How do we think about how to act in the face of this? And I think your book is a great guide for that. So, thank you.Erica ThompsonFantastic. Well, thank you so much for having me. It's been fun.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, climate communications expert Sage Welch gives scientific and social context to the politicized brouhaha around gas stoves.(PDF transcript)(Active transcript)Text transcript:David RobertsEarlier this month, gas stoves exploded into the news. Overnight, everyone had an opinion and Republican Congresspeople were threatening violence if jackbooted government thugs arrived to confiscate their stoves.A great deal of this gas stove discourse has been lamentably stupid, and some of it has been educational, but on all sides, there's just been a lot of it, so I thought it was worth doing a podcast trying to tease out the facts.To help with that I contacted the Sage Welch of Sunstone Strategies, a climate communications firm that's been supporting electrification policies since 2018. Welch has spent years tracking the science (which has been accumulating for decades), public opinion, and regulatory action on gas stoves. Together, we dig into how this controversy arose, the science informing it, how the politics are shaping up, and what it portends for the future of decarbonization.Alright, here we go. Without any further ado, Sage Welch, welcome to Volts. Thank you so much for coming.Sage WelchThank you for having me.David RobertsSo we're going to do this, we're going to get into stoves. Those of us who have been following decarbonisation and electrification have known about this for a while and probably have been cooking with induction for a while, but Lordy, did it bust into the popular consciousness in the past week or two and just cause a frenzy of nonsense. So, we're going to try to walk through the whole thing here, the background, the science, what's ahead. We're going to try to get it all, God help us. Alright, so, Sage, first of all, why now? What happened? Why is everybody talking about gas stoves now?Sage WelchYeah. So the roots of the past couple weeks debate is the result of three different things that happened in December. So, in December, the Public Interest Research Group held a webinar. The webinar was to launch a report that they had done with the Sierra Club based on a ten state survey of what information, if any, gas stove shoppers were receiving at point of sale from the nation's three largest retailers of stoves about the health risks and how folks can protect themselves, et cetera. And the answer to that was like, not very much information at all.David RobertsYeah, I'm guessing none is approximately none.Sage WelchNone and a lot of disinformation. Don't worry about ventilation. And many folks just hadn't heard of it. And to be fair, the retailers haven't been able to train their sales associates and staff. This just hasn't been on the radar. But they thought it was important to take a look and just see does anyone even get any inkling of this information when they're shopping? And so Richard Trumka, Jr., who is a consumer product safety commissioner, joined that webinar and he used that time to announce that the CPSC would be opening an RFI, a request for information on gas stove pollution in 2023.And he used pretty strong language. He said we need to be talking about regulating gas stoves, whether that's drastically improving emissions or banning gas stoves entirely. And this is pretty surprising, even to health and consumer advocates who've been urging CPSC to investigate this in recent years, but also going back 40 years.David RobertsSounds like it was pretty surprising to his own agency and to his bosses. Sounds like it was pretty surprising to everyone.Sage WelchThe world was not ready for Trumka Jr. to make this statement.David RobertsDo you know why? I mean, is he just the kind of guy who gets excited and gets out over his skis? Do you hear any hint of deliberate twelve-dimensional chess here? Or is this just Trumka getting too excited?Sage WelchI mean, it was a PERG webinar, so I'm not sure that, like, there was a lot of chess playing going on.David RobertsThat's a lot of dimensions of chess if you're starting there.Sage WelchThe sense I get about his position on this, and again at the CPSC level and we'll get to this, this issue is like, not new. But the sense I get is that he just takes his role and the role of the commission quite seriously as far as duty to protect consumers. And this question about whether gas stoves are safe or can be made safe has been hanging around for a while. But when he says banning gas stoves, I think maybe what he is getting at is like, he made these follow up remarks to Bloomberg a month later on products that can't be made safe can be banned. And I think, again, what he's getting at is just like, there is a duty at the commission to ensure safety of products. And as we'll jump into, there is what EPA and many others deem a safe level of NO2 pollution. And jury's still out on whether gas stoves are safe in that regard.David RobertsOr can be made safe in that regard.Sage WelchAnd can be made safe, exactly.David RobertsOkay, so Trumka says this on the webinar and then it didn't blow up immediately, right?Sage WelchIt didn't. Some folks actually did cover this. So the Hill Chicago Tribune actually kind of technically broke this story, but it doesn't blow up immediately. And then the following week, I think just somewhat coincidentally, Senator Cory Booker's office released a letter from 18 members of Congress calling on the CPSC to investigate gas stoves, calling out the health harms. And again, not the first time that a congressional body or a subcommittee has made this recommendation. And actually the Senate committee escapes me, but the head of a Senate committee also made this recommendation last August as well. So this is something that's been brewing in Congress in recent months and years. And then that happens and there's a little bit of coverage.But then in late December, a new study was published in a prominent medical journal from researchers at RMI Albert Einstein College of Medicine and the University of Sydney. And this study found that 12.7% of childhood asthma cases in the US are attributable to gas stove use. And that in some states, like Illinois, New York, California, where there's really high rates of gas cooking, that number is actually much higher. In Illinois and California, it's over 20%. So that study was fairly shocking, although it's based on statistics that have been around for quite a while that find that kids living in homes with gas stoves have a pretty substantial increased risk of developing asthma symptoms.David RobertsRight. Maybe we can touch on this again later, but just to be clear, this new asthma study was not a direct...it's just sort of a regression run on existing data from this 2014 study.Sage WelchYeah, this 2013 meta analysis. And actually, they only focused in this study on risk factors that had been established through North American peer-reviewed published data. But it is basically like a math problem. We know that this percentage that living with a gas stove can increase risk of developing asthma symptoms. And, therefore, when we look at the number of kids with asthma living in homes with gas stoves, it's called like a population attributable factor.David RobertsYeah. Right. The point being, it's not new. It's just that information was sitting there in that meta analysis basically has...Sage WelchExactly. It just helped them put a fine point on the number of cases that could be linked.David RobertsAnd so those three happened, and then the Bloomberg story followed up on that.Sage WelchYeah. So Bloomberg reporter Ari Natter was covering that report and then also thought to go ahead and do an interview with Trumka just based on those statements made in the webinar earlier. And so Trumka, in that interview, now utters what I feel like is just kind of this infamous statement that "Gas stoves are a hidden hazard. Any option is on the table, and products that can't be made safe can be banned," which is true. And so the Bloomberg piece publishes on Monday morning, and it just goes viral. Like, within 12 hours, everyone starts covering this potential ban. I think the language of the headline made it feel like this was far more imminent.David RobertsYes, I think he knew what he was doing here. So, just to be clear about what Trumka is talking about—not that the truth of what Trumka was talking about matters at all in this hysteria—but at best, he's talking about launching a process that will investigate things, that will go through rounds of whatever, that may someday result in gas stoves being banned from new construction. That is the worst possible—I mean, if you're scared of this—that's the worst possible outcome here. No one at any point was talking about going into existing homes and ripping out people's stoves. Let's just get that out there.Sage WelchNo, but the imagery is compelling.David RobertsThe jackboots.Sage WelchYeah. So for whatever reason, and obviously they'll find anything they can I think, but the right-wing echo chamber just goes, like, totally ballistic trying to paint this picture of a full-blown midnight raids of, like, dark Brandon invading with a crowbar, just like, pipes and all that...David RobertsWell, there's no mystery why they do that. They did the same thing with beef around Green New Deal or whatever. They know that this triggers all the right kind of resentment.Sage WelchYes.David RobertsOkay, so these three things happen and then Trumka follows up these three things with the big old bandword and then this all explodes. Suddenly everyone's talking about it. This is one of these funny experiences that people have in our world where we've been talking about this forever. It's just fascinating, sociologically fascinating to watch the vast bulk of people who just have never thought about this at all, right. This is the first they're hearing of anything about it at all. So it's interesting to watch people sort of like untutored, spontaneous reactions to this.Sage WelchTotally. I mean, this is, I just think, the best thing ever. I'm loving every second of it. A, because we've been working to create awareness about the health harms of gas stoves for a long time. But also, and we can get into this, I think Republicans think they've touched on this major kitchen table issue. But I think this is a really shining and striking moment for the climate movement and becoming relevant is not a bad thing.David RobertsYes, we'll discuss the politics later. I think they're less straightforward than people think. And I think you're right. But first, so this is why it's on everybody's mind now, insofar as we can do so in a reasonable amount of time. Let's talk about the science. Everybody's arguing about the science now. What do we know and how long have we known it? Give us sort of like a capsule history of the science.Sage WelchSo when you cook with methane gas, you're combusting a fossil fuel, much like you do in your car, but you're doing it in your home, and the pollution that's created goes directly into your kitchen and kind of just like, straight into your face. And ventilation can help disperse some of those pollutants. Ventilation is super important, especially if that ventilation is going outside. Unfortunately, a lot of ventilation circulates straight back to you and/or no one uses it, and/or you may not have a range hood, but we've actually seen ventilation not be super effective at dispersing nitrogen dioxide pollution. And that's the pollutant that we're really concerned about when it comes to the health impacts of cooking and of combusting the gas.David RobertsWell—what about I'm going to jump in with naive questions here.Sage WelchSure.David RobertsOne thing I hear a lot is that one class of pollutants produced by cooking is just from cooking the food, charring the food itself, which is going to be produced by any cooking.Sage WelchTotally.David RobertsAny type of cooking. So what are the percentages here? If I'm worried about those pollutants? Are those the main ones or is NO2 the main one? Where do they all kind of fall out?Sage WelchOkay, so when you cook, that process itself does produce particulate matter like PM2.5, right. There is research that shows that gas cooking produces like 50% more PM2.5. Or homes that are cooking with gas does produce a bit more of that particulate matter. And again, we'll talk more about this, but the gas industry is really seized on this idea that all cooking creates pollution. And it's absolutely true. Even electric stoves. It's a good idea to try and fan some of this particulate matter away from you and out the window.David RobertsYes, ventilation is important in all cooking. Let's just put a stake in that.Sage WelchBut then the conversation that we're having in regards to asthma and lung irritants, specifically, we really do need to zero in on nitrogen dioxide and NO2, because NO2 exposure is just really bad. This leads to aggravated respiratory symptoms, higher susceptibility lung infections like COVID, increased risk of asthma, as well as, like, IQ and learning deficits, increased risk of cardiovascular effects. I don't think there's anyone that's going to argue that NO2 pollution is not bad. We've regulated NO2 levels outdoors for a very long time. And I actually think that there's steady new research coming out that NO2 is even worse outdoors than we ever thought.But there's this funky little thing where no one actually gets to regulate indoor air concentrations. But what we know about cooking with gas is that in the time it takes to, like, bake a pie, about an hour, 90% of all homes, specifically when you're cooking with gas, will have an unhealthy level of NO2 pollution, a level that EPA says is not acceptable in outdoor air. And EPA research shows that homes with gas stoves can have up to 400% higher NO2 concentrations than homes with electric stoves.Because with an electric stove, you're not combusting a fossil fuel. This pollution is very specific to that fossil fuel combustion. And that, when it comes to NO2, kids are just really at risk. And so are seniors, and so are pregnant people. There's a lot of populations who, for whom, NO2 produces very bad outcomes. So there's about 57, just by my team's count, peer reviewed studies that have come out since 1976 that find links between gas cookings and various health harms. And these are all, again, peer reviewed journal published studies. And as we mentioned, that latest asthma study is based on some really important work that came out in 2013, which is a meta analysis. It's like a literature review of more than 40 different research papers looking at the effects of NO2 from gas cooking, and it's linked to asthma.David RobertsA lot of what I'm seeing about the science goes back to this 2013-2014 meta analysis and some back even to, like, a study in 1991, I think. I guess my naive question is: why isn't there more recent—especially given the rising sort of profile of this whole issue—why is there not more recent empirical, direct empirical research about this?Sage WelchI don't know exactly, but I'm not sure that my answer is I think it's just firmly established. I mean, I think the purpose of that meta analysis was to say the science on this is relatively well-established as far as the gas cooking creates NO2, NO2 creates health hazards. And we'll talk about this, but there was a flurry of research on this in the 70's and 80's by the gas industry, but also by the National Academy of Sciences. There was a 1981 symposium on indoor air pollution in Massachusetts and there was no less than 15 papers introduced at that symposium on pollution from fuel-fired appliances. We actually had this very robust conversation about this in the 70's and 80's, and it just kind of died down.David RobertsA couple of other naive questions. One is, like, my gas furnace also has a pilot light, right? Is also combusting a fossil fuel, in some cases people's water heater or whatever. Are all indoor gas appliances producing NO2 or do other appliances handle it better in some way?Sage WelchSo those other appliances are also producing NO2 and a wide range of pollutants. But the difference is they're vented outdoors naturally. The stove is the only one that's not directly vented outdoors. And I think it's important to bring this up, though, because I don't think it's been underappreciated the role that gas appliances play in smog formation. In California, where I'm based, there's air quality management districts and also the California Air Resources Board. These folks are required to meet federal air quality standards. And what I see them focusing on right now because actually there's some movement on this, we can't actually meet these standards unless we do something at the moment about these vented appliances.David RobertsSo gas appliances in homes and buildings are a notable contributor to outdoor pollution.Sage WelchThe gas appliances in the Bay Area contribute more like more NOx, which creates smog, than all of the passenger vehicles in the Bay Area.David RobertsNo s**t.Sage WelchIn California, in total, these appliances are responsible for more than four times the NOx pollution than our power plants.David RobertsThat is wild.Sage WelchIt's striking! Which, also helps put the stove in perspective because you're just like, yeah, you're burning a fuel that produces pollutants. There's not really any way around it. And that's one of the reasons why the California Air Resources Board, as a part of the state implementation plan, which is their plan for how they're going to continuously meet these federally mandated air quality standards, committed to basically a zero greenhouse gas emissions standard for heaters and hot water heaters by 2030, which effectively is going to end the sale of those products here in California simply because they are key contributors. And the Bay Area is also working on a rule on this, a NOx rule essentially. But fortunately we have technologies like heat pumps and others that don't produce any pollution. But yes, really underappreciated contributors to smog.David RobertsInteresting. And second naive question: a lot of the criticisms of the science you're seeing online are saying things like these studies sort of like seal a room in plastic and then run the stove and then of course you find nitrous oxides. But if you ventilate properly, you're fine. Can you get to a safe indoor air level if you are using proper ventilation? What's the story there?Sage WelchWell, I think that's the question that CPSC is setting out exactly to determine what is a safe level of NO2 and how can we ensure that cooking products are meeting it or fossil fuel appliances are meeting it. I think ventilation can help and it is, again, it's super important, especially as we're having this conversation. Let's talk about mitigating risk factors while also talking about long-term policy solutions. And I'll probably speak rather imprecisely and we can let people attack us on Twitter for that. But my understanding is that ventilation is not entirely or...I would guess I would use the word like "adequately effective" against specifically that NO2.My kind of silly understanding of it is that NO2 is like a heavier pollutant and it's harder to disperse. There was a study about whole home ventilation, which is kind of different than super high-powered range hoods, but it's actually kind of considered the gold standard in ventilation as we're learning more about how to produce the healthiest indoor air possible. And that found that that specific method is not effective against NO2. And to be clear as well, you're going to have levels of NO2 in your home because that is the key pollutant that comes from fossil fuel combustion.So if you're living by a road, which we probably all are, you're going to have some trace and ambient amounts of NO2. But you're not going to have...I mean, the gas stove is a little mini fossil fuel power plant. It is burning it right in your face. So it just changes that concentration dramatically.David RobertsAnd also it's worth pointing out here that what studies we have show that something it's like 20% of people, 30% of people report actually using their hoods, using their ventilation at all, much less on...And one of the reasons they cite they don't want to do it, is it's too loud. And of course, it only works the way it's supposed to work if you crank it up to the right level, right, based on your cooking. So you need it to be kind of loud and kind of running all the time if you want to even approach these sort of top levels of safety.Sage WelchYeah, if we ended this conversation with just ventilation, we'd be doing ourselves like a pretty wild disservice. And yeah, not only do folks not really use it and there are questions about how effective it really is. It's also...my last apartment, we had a gas stove with no range hood whatsoever. I can't even actually remember living in a place, which maybe speaks to Bay Area housing, but that has had ventilation paired with a gas stove. And as a tenant, you're very stuck there.David RobertsWe discovered when we remodeled our kitchen that our vent, which we never used because it was loud and rattling, just vented up into the attic. Like it didn't go outside at all. So it was just recirculating. And I forget the exact figures on that, too, but something like half of ventilation fans do that. They just recirculate air in the home, which, of course, is doing next to nothing for you. This is sort of my sign post around ventilation. Like, if you approach it scientifically and set it all up exactly right, you might be approaching safe levels of indoor air, but that is just the wild exception.And as you say, I want to return to this later, but we'll just sort of put a pin in it here. Renters and low-income people are the ones most likely to live in shitty setups with bad stoves and bad ventilation.Sage WelchAnd smaller. And this is the other thing that really matters here, is like the room size matters, the airflow matters. And yes, it's the smaller households where this is just really highly concerning. And it's also...I don't know, these could well be folks who are living in areas that are already really overburdened with pollution at the outdoor level. So the fact that you can't find access to clean air, I mean, I'm a parent. It just breaks my heart. It's not...yeah, it's terrible.David RobertsOkay, so this is the science. Is there more to say about there's lots of studies about NOx. Virtually impossible to get a safe level of NOx in your house if you're running a gas stove.That's well established. And then there's this other—honestly, really creepy—body of evidence that is coming out about what is in the gas that's in our home and when and how we're being exposed to that through leakage. So there's been a series of three studies in the past year. The first one came from Stanford. It came out in January of 2022. And that found that gas stoves are leaking methane. I mean, unsurprisingly, because gas is almost entirely methane around the clock while they are off.This is the pilot light or just something else?Sage WelchNo, this is like leakage from the fittings, from the stove itself. I think there's just...like this is a gas that wants to leak and it's going to find a way.David RobertsThis is an echo of all the recent research about methane pipelines, too, right. The whole methane infrastructure is leaking all over the place.Sage WelchAnd for this reason, and you folks have been making this point, like, gas stoves are a relatively small emissions impact, but they're actually a much more potent climate hazard than we thought. And that's what that research shows us. So that body of research shows that not only are gas stoves leaking a bunch of stuff well off, the methane side of that leakage is contributing to the...it's like the emissions equivalent of 500,000 cars being driven each year, totally separate from the combustion of the fuel. But just that sheer methane leakage is pretty big climate issue. And so that kind of established this point that these are leaking.And then researchers from Harvard and PSC Healthy Energy started a project measuring and looking at what was in the unburnt gas that was leaking from gas stoves. And they've done this in two places so far. The first study was in Boston, and they found nearly 300 chemical compounds, including 21 pollutants, that are known to be toxic to humans, including benzene to the known carcinogen linked to blood disorders and leukemia. And the Boston study didn't measure concentrations, but just the presence. We're like, "Okay, stoves are leaking, and they're leaking some really harmful stuff." And I just think at the core of this, it's just deeply fascinating that we don't know—and kind of have never really known—all the different components that are in gas.David RobertsIt's a little wild, right?Sage WelchIt's totally crazy! It's coming into our homes. And this PSE study that I'm about to mention, the title of the study is, "Home is Where the Pipeline Ends," because it literally is. From sourcing to transportation to distribution lines to your house, gas is picking up all kinds of stuff, and we don't ever really determine what is in that and how it could affect you. So this PSE study did the same thing as the Boston study. They measured what was in the gas that was leaking from kitchens in California, but this time they measured the concentrations and they found that in California, the benzene levels that were leaking were just off the charts, up to seven times California's recommended exposure limit.But those exposure limits are saying...those exist because the state kind of has to say something. But the World Health Organization, any health authority, is going to tell you there is no safe level of benzene exposure to the toxin that accumulates in your body over time, and it gives you cancer in the long term. So they compared this at the concentration level. The leakage in homes in California was about the same level of the benzene concentration that you'd see if you lived with an indoor smoker. And that's kind of interesting because the most recent RMI asthma study also found that that 12% childhood asthma link level is about the same as secondhand smoke.David RobertsInteresting.Sage WelchSo we have two different places where we're learning that the health impacts are just quite strikingly similar to what it would be if you were living with a smoker indoors.David RobertsAlthough I am extremely old, I did not actually live through the arguments, or at least was not paying attention to the arguments about indoor smoking. But from what I've read about them, they took an oddly similar shape to all these arguments we're having now. This is something I say about air pollution all the time, my Volts listeners are probably sick of hearing it, but just, it's been decades now that more or less every time scientists return to the subject of air pollution and they discover the same thing: "it's worse than we thought, it's worse than we thought, it's worse than we thought."That's consistent across decades, now, across pollutants. Particulates are this way, NOx, et cetera. So you don't want to sort of say, "Here's what we know today, and this is probably final." It's just, like, intuitively things are probably going to keep going in the direction they've been going. We're probably going to keep finding out they're worse than we thought and worse than we thought.Sage WelchTotally.David RobertsOkay, so NOx is super bad. The chemicals in gas are super bad. Both are being leaked into the home. We've known about NOx for a long time. We're learning about benzene and these new chemicals more recently. So let's pivot from the science then to the politics of this. So you say we've known these issues about indoor air quality related to stoves have been around for a while. Give us just a little bit of the history. Like when did this first start coming into the sort of consciousness of regulators and how has the gas industry responded over the years?Sage WelchYeah, so this is super fascinating and I think has kind of been missing from the discourse this week. So I'm really excited that we get to talk about it. But the best snapshot I've seen of this historical debate comes from a paper we found. The paper is called the "Impact of Indoor Air Quality on the Gas Industry." It was published in 1984. And let's just take a moment. Not the impact of the gas industry or gas on indoor air quality.David RobertsRight!Sage WelchYeah, this paper was commissioned by the gas industry. The purpose was to provide an overview of the indoor air quality issue to gas utility legal representatives.And they say over and over, the reason that they are commissioning this report and looking at this is due in large part to the fact that the Consumer Product Safety Commission was, at that time, undertaking a rather robust investigation into fuel-fired appliances. And so scientists, federal authorities, and the gas industry were all engaged in a very robust conversation about this. The American Gas Association actually set up something called the Gas Research Institute in 1976. Fun fact: costs that were eventually passed on to ratepayers to establish that institute through some fees that they were paying for pipeline transportation.And in 2000, that merged with the Institute of Gas Tech, or GTI, and they're still producing research for AGA. AGA and the gas industry kind of set up their own research. But what this paper shows us that in 1974, the science of the health harms was not only well-established, but there was like a lot of discussion about this in media. The gas industry in the paper says the gas industry has been researching this since the 70s due to Congress and public concerns. And as I mentioned there was that 1981 symposium they mentioned this in the paper where there's just like an explosion of papers and scientists really interested.And this is also around the time where we were really focused on energy conservation, so we were tightening up building envelopes. And I think that's part of the reason why there was also an expressed interest in what might be floating around inside because we were steadily locking people into those pollutants.David RobertsYes, the building ceiling I think you could probably view as like the tail-end of the kind of oil crisis, Jimmy Carter, "Let's preserve oil, let's do energy efficiency," tail-end of the 70's, that movement, which then ran into the 80's and Reagan, which I think our story does as well.Sage WelchYes. And so yeah, in this paper they give you this really fascinating snapshot, particularly of the media interest. So they're noting that there's a lot of articles running in the Wall Street Journal and Reader's Digest and Consumer Reports. They have some quotes from Consumer Reports. I'll read this one from 1982: "Children from gas stove homes have a greater incidence of respiratory illness and impaired lung function than those from homes with electric stoves." And then in 1984 there's this excerpt from a Consumer Reports article that says "The evidence so far suggests that emissions from a gas range do pose a risk. And if you're buying a new range and you can choose between electric and gas, you might want to choose an electric one."And that is just like verbatim what everything has said this week and some new reporting that we're seeing from Consumer Reports. So it's so interesting to me that we were having this conversation and we just kind of developed collective amnesia. I mean I think that's due in large part, and I'm sure we'll chat about this, to marketing of gas stoves, but for everyone being like this is coming out of the blue, it's being manufactured...like no!David RobertsIt's only about climate change.Sage WelchRight? Yeah, exactly. This is because we have this hidden agenda? I guess, maybe it's a hidden agenda to keep people safe. But no, we have long been...David RobertsSo what happened in the 80's? All these questions pop up in the early 80's. I remember other things about the politics of the early 80's. Think about all the many things that we started in the 70's that we just kept doing them, we so much better off today. Yes, and it all came to a screeching halt in the 80's.So during the 1980's, you have both EPA and the CPSC kind of working on this. Congress created this interagency research group on indoor air quality to coordinate research in 1979. And so that included various EPA investigations, and then, as we said, the CPSC was undertaking these investigations and offering reports about fuel-fired appliances. In the spring of 1986, EPA instructed CPSC, they're kind of exchanging dialogue about the fact that they kind of think there's a problem here. So EPA tells CPSC to identify the level of NO2 in homes that is coming from appliances.Sage WelchSo they're like, "Alright, this is your sort of wheelhouse," which I think this could also well be EPA's wheelhouse, but they say, "You need to now go out and find out what level of NO2 is coming from appliances and whether or not that's safe." And the fact is that that just never happened. And that's exactly what the RFI that Trumka's is referring to is going to do. So again, this isn't some new thing. It's actually just fulfilling this 40-year-old request from EPA. And I should add that this doesn't seem that uncommon on the consumer-product side.Like, I'm pretty sure asbestos and baby powder and lead paint. There was really well-established science for 50, 60, 70 years before...David RobertsLeaded gas, too! 50 years we knew about leaded gas. It's wild to look back now in retrospective how long all these things took.Sage WelchYeah. And honestly, thanks to industry and the fact that no one is really often is working on behalf of the American people, but a lot of people work on behalf of industry.David RobertsWell, let's segue then into one of the explanations. This concern was big in the late 70's and early 80's. It was moving forward and then got sort of shut down at the consumer agency, probably because they were not, the administration, was not big fans of regulation at the time, and was big fans of fossil fuels at the time. So one of the reasons that this got put on the backburner, pardon the pun, and stayed there for decades, is that the gas industry worked very hard to keep it on the backburner. So let's talk about that then a little bit.I think people are...there's a lot of information flying around these days about the gas industry's current sort of propaganda efforts, all its Instagram influencers and whatnot, but they've been at it for a while, so let's talk a little bit about that history.Sage WelchYeah. So even while, you know, the gas industry is doing a lot of research and kind of trying to work with regulators to control the narrative on the pollutants, they're also undertaking really aggressive marketing of gas stoves. But actually this goes back much further. So like nearly 100 years. This has been coming up a lot on the internet, and I'm so happy it's coming out, because I think it's one of those things that illustrates just how conditioned we've been. But this phrase, "cooking with gas," that was a phrase that was developed by an executive from the American Gas Association in the 1930's, and he happened to know some writers for Bob Hope and some other radio show hosts.And it starts to appear in these scripts and then just gets picked up by other places and really becomes, like, ubiquitous, this phrase and culture by the 1940's. Emily Atkins, in her heated newsletter last week dug up an old AGA newsletter where they're, like, reflecting on this, but pretending that they didn't actually plant it, and it's just a super funny...I thought that was hilarious. The newsletter is like, "Gasmen began to listen as they had never listened before, not knowing whether to be glad, mad, dazed, or dazzled by such widespread free publicity." It's like, they know full well...David RobertsHow did it happen? What's going on here?Sage WelchTotally.David RobertsOne of the obvious sort of first questions to ask is, you know, people who are familiar with the subject now know that gas stoves represent a relatively small percentage of gas demand, right. It's not a big piece of the gas industry puzzle. So what explains their sort of obsessive focus on it for so long?Sage WelchYeah. So, I mean, I think they recognized really early on that this was the way that they were going to ingratiate themselves to consumers and this was their way to get in the house and stay in the house. This was the only possible appliance that one could have an attachment to, right? It's the only one that's visible. It's the only one that you kind of actively use.David RobertsRight. And it's cooking, it's family, it's caring for your family. It's got all that whole web of associations.Sage WelchYeah. And they begin to market it as a status symbol. There's tons of marketing by the 50's and the 60's. It's how you're able to cook better. It's how you make food that tastes better. And they're really just, like, selling at the time to basically women. Like, this is how you be a good wife and a good mother, and this is how you feed your family. And they're especially speaking to kind of like, major coastal urban areas just because that's where gas demand was sort of emerging and that's where they had the funds, essentially to put in the infrastructure. So, as you referenced, gas residential use just really skyrockets, very particularly in major coastal urban areas, so, New York and California. And that's still today where we have the highest rates of gas cooking and gas consumption.David RobertsRight. Well, let's just make a note of this because everybody loves to laugh about this on the Internet. Gas stove use is much higher in blue states than in red states. This sort of an inversion of the culture war that we're having. Actual distribution of gas use is almost opposite of that.Sage WelchTotally. And so to see, like, the right-wingers pick this up as like this kind of populist kind of issue when it's actually been like, you are much more likely to cook with gas if you are a higher-income person, especially if you're in the Southeast, because you paid a lot to get yourself gas service there. And so there's a huge amount of consumer marketing through these decades. But then there's other ways that utilities specifically and when we talk about the gas industry, there's a web here, but often we're talking about the gas utilities who sell the gas to consumers.David RobertsYeah, and let me just say by way of background, I mean, maybe this is probably obvious to you, but to make sure it's clear to everyone, an electric utility is involved in giving you electricity. It is, at least in theory, neutral toward how to generate that electricity, right. It can accommodate different ways of creating that electricity. A gas utility is very different. It's about the one fuel. And if we use less of the fuel, then the utility shrinks and disappears. Gas is existential for gas utilities in a way that none of these arguments are for electric utilities.Sage WelchTotally. And so you see, gas utilities do this kind of interesting thing where they set up, like, culinary centers and test kitchens and they develop relationships with restaurant associations, they sponsor scholarships, and they make gas, this core curricula of culinary schools, which is obviously another very clever way that you are embedding yourself in that culture specifically for chefs and for folks who do cooking as a profession.David RobertsRight.Sage WelchAnd as we now know, they begin to really lean into this relationship and rely on that relationship with chefs and restaurant associations to fight electrification. We're seeing this across the board in states where we have policies moving, but yeah, they've really relied on gas to be this wedge between them and their kind of competitor, electricity. And then they started to really double down on this in the past five years or so when they perceived that electrification is going to be a problem. We actually have some emails that came out through discovery between the American Public Gas Association and SoCalGas, and I find this particularly egregious because APGA represents municipal utilities.So these are like publicly-owned utilities. These are like even more than investor-owned utilities who in my opinion, also should be working for us because they're supposedly providing a public good. But like, APGA and SoCalGas are trading emails about this energy-efficiency proceeding in California and they're like, "Oh, it's coming. Broad scale electrification is on the horizon and it's a huge threat." And APGA actually launched the very first...a lot of folks have been talking about these influencer campaigns. APGA and AGA both had them. But APGA went first with this gas-genius campaign that's like very targeted marketing at Gen X, really trying to sell themselves to a particular generation there.And then AGA did the same with this "Cooking With Gas" campaign where they're basically paying influencers on Instagram to gush about their gas cooking. And as much as that got called out and has been this kind of just public source of mockery. We're still seeing them do this. Like, Southwest Gas did this just last year with some really honestly hilarious videos of some folks in Las Vegas, like, burning eggs and talking about how "you can only burn eggs effectively with gas."David RobertsIt's so cringy to us. This is one of those things where, like, how do normal people process these things? I have no idea. It's been so long since I've been a normal person on this subject. It's very cringy to us. Do we know whether it works? Like, do we know, if you're just an average Instagram schmo and you run across one of these things, whether they're effective?Sage WelchWell, the one reason I would say that it probably is effective is because it's a message that's echoed not just from an Instagram influencer, but at this point, this has been incredibly successful to manufacture a consumer preference for gas and to truly believe that you can only cook better and that food tastes better. And it's like, I can't not picture those chemicals now when I see the blue flames. So this idea of, like...my partner is like his method for cooking tortillas is like, he chars it directly over the frame. But I'm just like, that is not seems super safe or great right now.David RobertsEggs are better with benzene.Sage WelchThat is wild.David RobertsAnd we should also just note, as you noted before, but I want to just put an exclamation point on it again. Very frequently gas utilities are using ratepayer funds to do this propaganda! So it's gas customers that are often paying for the sort of lobbying and propaganda that we're seeing.Sage WelchYeah, we unfortunately have to pay our gas company to prevent us from accessing better options and prevent us from having a good faith conversation about this. And this is what makes me actually, like, very angry is, even this week, everyone acts because this is the frame they set like a zero-sum game. We don't get to have an honest, straightforward conversation about the safety of what's in our home, how we can protect ourselves, and just the benefits of doing so. And, yeah, it's frustrating.David RobertsWell, I mean, as you say, this is precisely the reason they honed in on stoves so long ago, is, number one, stoves are very emotional to people, very connected to a lot of emotion. And number two, if you're trying to electrify and get rid of gas, most people, I think, don't have a super strong preference about their water heater or their furnace or whatever. So if you can switch those out for electric, but you can't cut off the gas line to the house as long as there's a gas stove, right? So as long as there's that gas stove, there you are preserving the gas hookup in the gas infrastructure. That's what this is about. That's why they're focusing on stoves, even though stoves aren't that big a consumer.Sage WelchTotally. They know full well that this conversation really is about that infrastructure, but so long as we can keep people sold on this idea and...one thing I think is a little bit wild, a lot of folks feel strongly about their gas stove. It's becoming a Republican thing, which I totally love. And we can talk about how this is like pushing a target audience away from gas cooking, but when people say, like, "We can't switch or gas is just better," like, a. that's been manufactured. But we also haven't been cooking with gas for all that long.Like, this is the 50's, 60's, and 70's, we transitioned from like, coal stoves before. There's a chef that we work with, Chris Galarza, and he just makes the point that we can still have culture and tradition. It's not the fuel source. Cooking will remain a wonderful way to unify families. We can learn, we can change. We change to gas.David RobertsFood still heats...Sage WelchRight!David Roberts...and eats! And this is also—I don't know if it's the right time to say this—but for some reason I see these people on Twitter saying confidently, like, "I've used both and gas is so much better." The way that makes me feel is always similar to how I used to feel about the debate about marijuana legalization. Like, you can go out in public and confidently say that "if you smoke pot, you're going to be deranged and wreck your car," or whatever, but I've smoked pot. Like a bunch of people have smoked pot.You could fool us about things we don't have direct experience with, but...Sage WelchTotally.David RobertsWe've experienced this and we know that's b******t! I've cooked with both gas and induction and the idea that just your average run-of-the mill Joe or Jane in their kitchen is so expert that these fine distinctions of like, "Oh, I've got to get exactly the right char." I'm so sure. Like, I'm so sure you're getting the exact right char.Sage WelchYou get takeout!David RobertsYeah.Sage WelchYou're eating 50% of your meals from the burrito shop. As am I! It's fine! We could admit this, but it definitely became the "smartest person in the room" response to the debate. But what I don't like about that or what I would hope folks would understand is, like, you're...I mean, it's just like with cars and massive cars, you've been taught to believe that. That has been manufactured. All consumer preferences.David RobertsPeople really do not like to hear that their own consumer preferences have been shaped by socialization and by nefarious forces. They really, really don't like to hear that. But it's just true. All of us were born into this. We're shaped, we're socialized, we're given messages, and then we grow up and suddenly we have this passionate idea that gas stoves are better. I just wish people would just take a step back and think a little bit, like, really? Did you was that purely through your experience of cooking on gas that you came to this weirdly, passionate feeling about an appliance. Just consider.What I, again love, about this week is you have these right-wing representation—walking representations—of toxic masculinity now, being like, this appliance is the thing that they care so much about, right? I mean, yeah, God, guns, gas stove, but keep it up. They should continue on this.Let's talk about this. Let's talk about this. So we've got these health concerns that go way, way back and are fairly well established. We've got this long history of the gas industry propagandizing around gas stoves, making these relationships with chefs and culinary centers really working the idea that high-end, your sort of more sophisticated consumer, of course, will only cook with gas. And so you get this sort of high-end sheen. Your thesis, I mean, I think a lot of people looking at this sort of intuitively would think, "Oh, no, this is another culture war. It's another backlash. This is another environmentalists are shooting themselves in the foot by going after things people love and they're only harming their own long-term goals." And all the usual lecturing of the left is in full flower out there on Twitter. But your thesis is that the political valence of this, the political consequences of this, are going to redound in favor of environmentalists. So tell us why.Sage WelchYeah, so there's a couple of key reasons. One is just simply like awareness raising. There has literally been close to 10,000 media stories in the past two weeks about gas flows and asthma. Like, bring it on, keep it up. This has been a phenomenal moment for induction cooking, which the issue with induction in the US, not in Europe or other markets, has just been sheer awareness. It's like 3%, I think, of the market. And unfortunately, to date, manufacturers haven't really pushed this technology super hard. And so there hasn't been a lot of advertising of it.David RobertsYeah, let's just say because this has been also coming out in findings recently, too, and this was in the New York Times story they did. The problem here is not passionate defenders versus passionate haters of stoves. The vast, vast, vast majority of Americans specifically don't know what any of this is about and might not even be aware that induction is a thing that exists.Sage WelchTotally. So, yes, when everyone is worried about this, and rightfully, we all understand, they're talking about those old school coil-heated stoves that really take a long time to heat up, and they weren't super powerful and do suck. I think new electric models are kind of fine, but induction is not fine. It's totally awesome.David RobertsIt rules.Sage WelchIt really is. But just quickly, on that kind of awareness raising, I think it may not even seem like it today or in two weeks, but my personal experience on this issue and again, I'm a renter and have pretty much all our places have had gas stoves, is that I learned about this about five years ago. I was like, wow, that's interesting, but I'm obviously in no position to change my stove. And then every time I clicked on the pilot light and I saw the flame, I just started to get a little bit worried. And then I started to realize that my five year old is fully eye level with that or like, the baby is crawling towards the stove and it's like alarm bells started to be raised and it's just that sheer little bit of doubt that finally I was like, well, "I'm tired of being stressed about this." So we just bought a Duxtop single burner cooktop, and we cook all of our food for a family of four on a little induction cooktop. And that's the other thing that I think has been missing, in there's been incredible coverage of induction. It's finally kind of coming into the public consciousness, and folks are noting it can be a little bit pricier, and I think there's a lot of cost competitive ranges. But it is true if you're getting like a full blown oven, but you don't need to do that. You can spend under $100 and you can use that and your toaster oven and your instapot and your air fryer.I think if you look around your kitchen, you'll probably find you have a lot of electric appliances that can cover all of your kitchen needs. And yeah, maybe this isn't the absolute five-alarm fire from a health perspective, it's certainly worth a look, but there's really easy solutions where we just don't even have to think about whether or not we're getting exposed to NO2.David RobertsYes, this is something I have kind of wanted to say about the whole debate. I might as well say it here, but it's like, if there were super, super compelling reasons to keep gas in your home, then maybe they would offset these health concerns. Because, like you say, there are other bigger health risks out there in America for people to worry about. This is sort of like an exacerbating factor on the edge, but there just aren't. If there's any concern at all, induction is just better, so why not do it? The idea that there are countervailing considerations here is just kind of silly to me. Like, we're talking about a product where literally a better, cleaner, more convenient product is available.Sage WelchTotally.David RobertsSo, it's like you don't need that much evidence to prefer the latter.Sage WelchYeah, top to bottom. And this isn't just true on the cooking side. This is true for heating. Heat pumps are just a better technology. You're going to get cooling access that you didn't have before. You're getting rid of super inefficient electric-resistance heating and inefficient cooling. And we're going to help solve a lot of our grid demand issues every single—and this is one reason I've been a little frustrated—because I think the climate movement in general, we get super scared when a fight happens. We're like, "Oh, my god, I'm on the spot." But this is the most incredible opening we've ever had. We have no reason to be ashamed of pushing electric technologies because they are literally better at every single level. And it's okay to fight for people's health. It's okay to fight for things that are good.David RobertsYes. And I particularly love the like, "Oh, you only care about this because of climate change. I'm like, well, even if that were true, it's kind of a big deal." It's true. I am concerned about it. You got me.Sage WelchTotally. Don't let them push you into this idea that the hot seat is a bad place to be.David RobertsRight.Sage WelchUse it. This is awesome.David RobertsAnd it seems to be shifting. So let's get back to politics a little bit. You think by the sort of MAGA crowd claiming this as a cultural symbol alongside their guns and their rolling coal and whatever else...burgers? Or whatever else they've picked as sort of their cultural touchstones, you think that's good for the politics?Sage WelchI think this is near-fatal for gas utilities, this discussion. So I think that this becoming a culture war, and again, I think gas cooking being identified as a right-wing virtue pushes a really important group of people to no longer or to think twice about identifying with gas cooking as a key part of their identity.David RobertsYes. Which, as we've noted, is mostly like most of the gas stoves are in blue states.Sage WelchExactly. Yeah. New York, California, Illinois, these states make up 25% of gas demand in the US, and they have the highest rates of gas cooking. Nine of the eleven highest gas consumption states are either blue or purple. And electrification is happening in blue states. So, as a lot of folks maybe know, about 20 states pretty much across the Southeast are preempted. So Republicans have run bill with support from their allies in the American Gas Association and otherwise to prevent them from doing any kind of a broad scale, like, local level electrification ordinance. But in blue states where we need support for this, people are now being told that cooking with gas, which has always been the biggest hang up, right? This previous attachment to gas cooking, even for climate-leaning folks, has been this lingering reason to not support electrification or to feel a little worried about it.David RobertsBecause it still has that sheen of like, sophistication and high end.Sage WelchTotally.David RobertsSo now we have MAGA people telling them... nope!Sage WelchYeah, I personally don't want to be identified with those folks. And I think a lot of the left-leaning folks don't. And these are the exact folks that we actually needed. And honestly, in my view, this is a total act of goddess. We never, ever could have unwinded that 100 years of marketing to position it like this if this week hadn't happened. This is incredible. There's a Yale study where they asked folks what words come to mind in association with natural gas. They use the word "natural." And the words that came up for folks was "energy, clean, fuel and cooking."And after this week I think it's going to be like: "asthma, harmful, health...David RobertsMAGA.Sage Welch...Republican," right? And also I just think the frenzy on it makes that identification feel a little ridiculous and that the folks who really are going to identify this are folks that unfortunately—I care deeply about them. I wish they could also have access to a pollution-free home—but that's a population we were never ever going to reach on this issue. So there's broad swaths of the people in this country that I think are normal and seeing these other folks taping themselves to gas stoves and making protection of a kitchen appliance the biggest thing in their world, that's objectively funny and it's silly and honestly, ultimately it's weak.And it's showing us that a deep identification with just one cooking technology is a little bit silly, especially if you're going to ignore a huge body of science that says that cooking technology could well be hurting your health.David RobertsIt's funny, just that angle sort of hadn't occurred to me that it's specifically now MAGA people telling the blue owners of most of the stoves that ownership of those stoves is now a MAGA right-wing thing. It is, exquisitely, sort of a counter to their own interests. Kind of beautiful that way.Sage WelchWorst possible messengers. God, I would love to see group chats on this from some other sides because I wonder...because how this went down to Bloomberg started covering it, couple of the right-wingers came out, and then it was like the next day you have Joe Manchin and it really blew up. And part of me wonders if the sending out of the talking points to get the right-wing machine in gear was coming from the more established like Koch brothers things. But I just wonder...and maybe the American Gas Association and others threw up a call for help, but I think probably pretty quickly realized that this was not going to turn out well, again, in the electrification states where the gas utilities are almost entirely dependent on selling their gas.And it might be a while before we see how this all plays out, but I just firmly believe that, again, this has been one of the most incredible turning points that we could ever have even dreamed up, or manifested, to help educate folks about the health harms of gas cooking, but also to undo this conditioning, which has barely been a barrier for us.David RobertsYes, it's beautiful. So the politics seems like the most predictable political effect of this is going to be in blue states where gas bands are being discussed are on the table now, or are a possibility. This is now going to sort of reframe those gas bands as a way to stick your thumb in the eye of the MAGA movement which is absolutely the best way you could sell those in those states.Sage WelchYeah. And also a way to protect your family and get access to funding and everything else that we need to get access to folks. I mean, I think one of the things that also could be going on and folks just get...I think climate folks in general get afraid to be vocal, but I think that this is just a really important time to again bring up that this is like not a zero-sum game, that the electrification movement gas bans or gas ordinances or all the work that we're doing to try and bring folks into healthier, better housing. That doesn't just have the super straightforward winners or losers.And I think one of the reasons why we're afraid of harnessing this narrative is like, we're very conscious of organized labor membership or people who don't have the means to electrify. But I think this is just exactly that opportunity to get out there right now and fight for those who have gas in their homes to get that out, get them access to induction cooktops, let's expand IRA funding. Let's use state budget to help supplement the cost here. And I think workers who really do care about climate change, this is our chance to tell folks that this is electrification is huge for skilled labor. There are so many opportunities.David RobertsI keep reading and hearing stories about how we're short on those workers, those basic trade workers, specifically electricians, which we're going to need a bazillion of in coming years.Sage WelchYes, this is a chance to revitalize vocational education in this country and beef up unions. Like we need electricians across the board. Also for the plumbers and the pipefitters. And this is what bothers me is that the tops, the leadership and the utilities, are going around telling everyone that, "Yeah, this means your job, your job is over, you're done if we pursue these electrification measures." When, really, we have thermal energy networks coming up as a solution in states across the country, plumbers and pipefitters are going to continue to work on pipes. We're just going to pipe, like, clean energy and use heat pumps.David RobertsHot water!Sage WelchYeah, it's electrification. It's labor-lead electrification. And even for the gas linemen and folks, who I would say probably know better than anyone exactly how dangerous gas is, and we didn't even touch on the fact that when you electrify, you're getting rid of explosions and so much beyond just the health. But these workers, if we all agreed tomorrow that we're going to retire the gas system and move to 100% electrification for homes, that's 20 to 30 years of work in which that expertise...David RobertsI know!Sage Welch...is so central!David RobertsOf all things that would do, threatening jobs is just absolutely on the bottom of the list. If there's one thing we know about what that would take, it's a lot of work.Sage WelchSo much work and an opportunity for solid family-sustaining, long-term work, and the education pipelines. There's a really innovative approach that's being proposed in New York right now to very specifically go to communities where there hasn't been traditionally opportunities and where it's overburdened—y'know there's pollution burdens—and get folks into those pipelines right now. And we can have this like an honest, real conversation about electrification is really important. I think this is an opportunity to have it, so long as we can push the fossil fuel folks out of the way who are preventing us from speaking about what's really at stake here, but also the sheer amount of opportunity that we're presented with.David RobertsRight. And I think this gets at the politics too. The gas industry would love for this entire discussion to be focused on one asthma study. So the discussion is not just about the one study. It's not just about the history of studies. It's not just about the other risk. It's about all the risks of gas infrastructure. And it's about the way that gas stoves are the sort of cork in the bottle, you know what I mean? Like, once you get them out of the way, the rest of electrification becomes easier. Even though they themselves are a relatively small part of demand for gas, they're a very big symbolic and sort of political flag in the ground for the gas industry.So they matter, broadly, for labor, for politics, for health, and for decarbonization. Even though they are a small source of greenhouse gases in and of themselves, they are part of the larger picture of decarbonization. So, I just think we need to keep pulling the lens back.Sage WelchAbsolutely. And honestly, they've been accusing us of banning gas stoves for four years, so we don't really have that much to lose in this moment. Also, this was never: a. no one's banning gas stoves, but this came from a regulator. This didn't come from climate folks. So it's a super fascinating moment. But, yes, let's harness this. There's like, so much education that can be happening, and it's okay to fight for what's right, even if it's uncomfortable. We still lack, like, climate pundits who can get into the country.David RobertsI know! Well, it's all these sort of establishment, like the disease of the left or the Democratic Party in the United States is this posture of cringing presurrender and terror. This whole idea that the power and the momentum is on the side of reactionary forces, and I just don't think that's true. And just confidence, right? Just confidence is what the whole friggin' left, the whole Democratic Party and the whole climate movement needs more of, like, "Yes, you caught us. We're trying to make things safer and stop climate change. Busted."Two more quick aspects of this before I let you go that I want to get into. One is just the environmental justice angle, sort of like one thing that reactionaries will say, "This is going to hurt poor people worse because they can't afford these fancy, expensive induction stoves, and so they're going to be hurt worse by this." But another way to look at it is by locking in gas stoves, we focus all our attention on sort of this upscale suburban woman consumer but it's going to be poor people who can't get away from gas stoves, right? I mean that's how it always ends up. The poor people who work at the restaurants, the poor people who are renting...insofar as we let guests hang around, it's not suburban mom who's going to be the modal consumer, it's going to be people who can't get away from it. So how do you think about the justice, environmental justice and sort of economic justice aspects of all this?Sage WelchYeah, we are about to see in the next month or two this wave of gas heating bills hit folks across the country. Like the price of methane gas has been up every year. It's like doubling. But this winter has been crazy for this. And I think it's like not fully understood that you have this spot price of gas, methane gas that is passed on by utilities who pushed for pipeline replacements and all this other infrastructure that is also added to your bill, but then claims no responsibility when that price goes through the roof and you're hit with hundreds and hundreds of dollars.And a lot of the moratoriums that we had on utility bills shut off have expired and I think we're about to see a really horrible crisis. So when folks say that gas is the cheaper option, well, right now it absolutely is not, and it's certainly not when you look at the concept of as you're speaking to stranded assets. The fact that a lot of folks are going to be left on a gas system that steadily needs a huge amount of investment only just to keep it safe, supposedly, let alone when utilities get their way and pilot all these ludicrous like hydrogen for heating projects and make us pay for renewable natural gas and stuff. So we have a total crisis on our hands on energy affordability across the board, but that's being driven—on both sides—from the fact that we're exporting all of our natural gas and that prices are going through the roof and that's driving up both the price of electricity and the price of gas-heating bills.And this is one area where there's folks who are really doing interesting, like push the envelope, work on energy-burden stuff. But we absolutely need to be more vocal and also just like near-term focus on these bills and making sure that power does not get shut off. But yes, beyond that, I think we're starting to see this. So California had, we had close to a billion and it got cut back a little bit and extended over years. So Governor Newsom really would like to see our funding reinstated, but close to a billion in california from last year's state budget to do low-income whole home retrofits.So this is, go to homes, get them heat pumps. And super important point here on heat pump efficiency is that in most places that's going to produce great kind of energy savings while offering access to cooling. All across the I-5 corridor, Portland, Oregon can hit 116 degrees for five days at a time. We need cooling yesterday. And actually in Portland, there's another really innovative program, this Portland Clean Energy Fund, that's distributing 15,000 heat pumps to homes in need. I saw some super sick legislation get introduced in DC to do these kind of low-income retrofits. But right now, I think if we could just all focus—and this is the goal, the kind of government funded and incentivized electrification needs to be laser-focused on helping lower-income folks. And folks without the means to electrify do that.That's a policy problem with a policy solution. There's a lot of money changing hands floating around in the world and we can absolutely make this happen. And in the process of doing so, we're going to lock in better affordability, but we're also going to clean up the air, get access to cooling, and solve a lot of major kind of urgent crises that are coming with extreme heat. And then we also need to have a discussion on the infrastructure side. Like climate change is posing a very serious problem to all of our energy systems.And right now we pay for and we maintain two really complicated energy systems, gas and electricity. We don't have a choice to live without electricity, like that's not happening. So we need to take all of our time and energy and shore up and safeguard transmission, build more transmission, build more renewables. And there's an economies of scale here. We need to focus on systematic, organized, neighborhood-level retirement of the gas system, work with those communities to electrify. And bit by bit we have this really promising future of retiring that gas system and just focusing on what we need to create community resilience, which is like distributed clean energy neighborhood resource centers where, you know you can go for air conditioning or anything else.And there's so many solutions. Again, which if we could just focus our attention there and we weren't fighting on so many fronts, we would be much better off.David RobertsSage, you're singing my song here. You're singing the Volts. This is like the Volts theme song you're singing. And this is what I would say to people, too. The arguments about this tend to be so narrow, like the cost of this stove versus that stove in January 2023, you know what I mean? Or like the number of electrical brownouts and blackouts versus gas outages and all these sort of narrow comparisons. But I just wish people would like step back long-term on some timescale and on some geographical scale. We have to electrify completely. We have to more or less get rid of as much gas as we can get rid of.And that's going to be, ultimately, safer for people, better for their health, more reliable and cheaper in the long-term. So it's not a matter of whether to do this stuff. It's just a matter of planning how to do it right. And as you say, if we didn't have to maintain two concurrent infrastructures, we could make the one that we need and love and need long term a lot better and safer and more reliable.Sage WelchTotally.David RobertsI just repeated everything you said, but that's my theme song, so I got to sing it.Sage WelchIt's an exciting proposition and I'm not sure that the kind of end goal of electrification was ever really made clear. But there's just so much about it that's going to be so helpful. I mean, we're going to have extremely responsive energy demand between vehicle-to-grid integration. They're building heat pumps with batteries in them. There's so much innovative technology and what folks are worried about is their own personal resilience. And we can invest in that. There's a lot of solutions. But yes, if we could just shove aside everyone who's trying to force us into that zero-sum game thinking and these really bad faith conversations, then I think that...if we can kind of speak to what we are giving people, which is a s**t ton when it comes to electric technologies, they're going to be on our side.David RobertsWell, this is my final question. The last thing I want to ask you about: the environmental movement is often accused of only being against things and constantly saying, "no, no, no" and constantly wanting to take things away from you. And that is very much how the people currently yelling at environmentalists are trying to frame this whole thing. So I know that the anti-gas sort of movement, the science organization, it's all underway and that's great. But what about the pro-induction? Like, what about the selling of the alternative? I wish that it seems to me that that's a big missing piece of what's happening right now.It'd be a lot easier to have these discussions if average American consumers understood better, that what they're being encouraged to get is better. It's just better. So when I hear about giant propaganda campaigns to preserve fossil fuels or—I talked to Michael Thomas on the pod a few weeks ago about the sort of right-wing funding that's going into all these anti-renewable energy groups and these NIMBY groups—I always come back to the same question, which is, there are millions, billions of dollars sloshing around on the left, sloshing around the big "green groups." Where is the pro-electric appliances, generally, but just pro-induction stove propaganda campaign? Who on our side is funding...? All you need to do is you don't even need to lie to anyone. Just tell them...Sage WelchJust show that.David Roberts....the truth about induction stoves. Is anyone doing that?Sage WelchYeah, I think folks are doing this. So there's two tracks here. One is that I think we did just open this incredible door for the actual manufacturer. So if you are a stove manufacturer this week and you make both gas and electric models but the New York Times just called your product a kitchen pariah and The Atlantic said it was doomed and House Beautiful said the era of gas stoves is over.David RobertsAnd let's mention this too, Wirecutter the Geek, which all geeks worship, has revised and now no longer says that it makes sense to hold on to your gas stove if you have one. They've revised and are basically saying replace this as soon as you can.Sage WelchAs soon as you feel like it's feasible. That's huge, right? This trusted consumer resource. If I was on these advertising teams, I would very quickly be reapportioning my budgets to the potential growth industry. I think your question is really interesting. I think that the job of the climate movement on this very specific topic is to sort of push the policy that shows the market exactly where the growth industry is. And I think we're starting to do that, so heat pump sales are through the roof, and, my hope, is that this week will lead to induction.David RobertsI wonder.Sage WelchWe just showed them this is how you market it. It's clean air, it's pollution-free, it's worry-free technology for your kitchen. And we have local news folks, actually. I saw two clips that I just thought were adorable of going around to appliance showrooms this week being like, "Are you getting a lot of questions about gas stoves?" And all the appliance people are like, "Yeah, and we're super psyched because we've been sitting on these induction stoves that we're finally getting to tell people about." But my hope is that we're going to see a huge influx in advertising dollars just because also, right now, close to a quarter of the population in this country is living somewhere where an electrification policy is moving.And if you make these technologies and a lot of the OEMs make both, you should really start to invest in the product that has a future, rather than the product that simply doesn't. I think it's a little awkward to have climate folks necessarily selling technology because I actually worry that would turn folks off. What I want to see is the cool, sleek folks who know how to advertise stuff to put money into this so that we can show them. And I think the role of climate people honestly should be continuing to push the policies that are going to push the market.And I think the OEMs are starting to come around on this. And I also think the technology is improving so dramatically that I guess my hope is that we're about to see a massive influx. But speaking to your other question, or part of your question about why, which I've heard you bring up before, like, why does the climate movement or the folks who hold the big money, which tends to be the big greens and or the funders, not put more money into paid advertising? I think part of it has to do with a metrics issue and part of it just has to do with being wholeheartedly focused on our narrow view of hitting policymakers and that policy line.And I do see some general advertising TV spots starting to push back and I think that we should actually be far more aggressive in going after our enemies with those advertising dollars in general. One thing that worries me is like popular opinion or public opinion, like on climate change, for example, doesn't necessarily translate to policy action. So I think funding for paid-on really targeted kind of state-level advertising is a really good idea basically, for lack of a better word, to take down opponents and make very clear who is standing in the way of what I think most people want. I don't think our goal is to shift public opinion on climate so much anymore, is show exactly who is standing in the way of that and overcome that barrier. Because unfortunately just the politics of our country mean that even if something is wildly popular with folks, it doesn't translate into them getting access to that through policy.David RobertsRight. Yeah, I get all that. My instinct is that it just wouldn't take that much money. It wouldn't take that much money to do what I want is, sure the stove industry is going to advertise their stoves and the car industry is going to advertise their EVs, but I always think about this commercial for the Nissan Leaf. I don't know if I'm the only person who remembers this commercial. It's one of my favorite commercial in the friggin' world. But it shows these people waking up in the morning and they go crank up like a fossil fuel powered coffee maker, which starts sort of spewing smoke in their home and then they go crank up their microwave.The point being like, "Wouldn't it be ridiculous if your home appliances were powered by fossil fuels and were spewing pollution into your home? Wouldn't that be crazy? You wouldn't want that. Why wouldn't you want electric and clean?" And this to me is sort of like it's the gestalt of electrification that no commercial entity is going to advertise that, but somebody needs to be talking about how look, you got an induction stove with a battery in it. You got your car with a battery in it, you got your whole-home sort of software that's coordinating these things so you can make it through a blackout and so there's no emissions.Just to sort of like a better world as possible kind of gestalt. I just feel like that is something we know about. You and I and people like us can envision. But that vision I think, is very not well-known. Products are unsafe. It's a very familiar story to American people, but this sort of, like, this electric utopia that lies ahead of us in coming decades, I don't think any of them know about that.Sage WelchAbsolutely. And yeah, maybe only because I just don't necessarily want to see the in-house comms teams at the big greens produce those advertisements.David RobertsJust give money to someone who knows how to do it.Sage WelchExactly. Let's bring in...and there's efforts underway. There's the Clean Creative Projects that are working to get PR agencies more engaged with climate and saying no to fossil fuel projects and things like that. But, I totally agree. That kind of combo. I would like to see our points and their messaging and advertising expertise and also in part their advertising dollars. Because even if we peeled off money from...I agree there's billions floating around here, but I think it's usually a drop in the bucket compared to what major companies put into their sort of core advertising push to sell products.But if we can create that alignment and, again, I think the policy is showing them that at least if you want to salvage it. And just what I would like to make clear is, just don't spend your time trying to salvage the bad stuff. But yes, let's show everyone how amazing the good stuff is going to be.David RobertsYes, a lot fewer people will want to fight these rearguard battles if they can see a positive vision ahead, not only for the world, but for their stove company or whatever.Sage WelchAbsolutely. And so all those big OEMs and others with major...that pay a lot of lip service to climate, like, yeah, maybe it's time to start embedding that in the advertising and in the messaging that's going out from your companies.David RobertsWell, Sage, I really cannot thank you enough. The stove thing is sudden and sprawling, is both sudden and sprawling. So it was very helpful to walk through it like this and maybe we can do it again in a year and see how induction stove sales are going. I mean, this is such a fast-moving...and as you say, a huge, huge opportunity for the good guys here, the people trying to solve climate change, the people trying to improve public health, the people working for environmental justice. A huge opportunity. So thanks for emphasizing that, too. Thank you for all your time.Sage WelchOh, thank you, yeah. Best week ever. Happy to do it.David RobertsAwesome. Alright, thanks. Bye.Thank 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, as a guest on Canadian daily news podcast The Big Story, I discuss a momentous fusion breakthrough, just how close we actually are to a future of unlimited clean energy (hint: not very), and where we should be focusing instead.(PDF transcript)(Active transcript)Text transcript:David RobertsA few weeks ago, I was a guest on the Canadian daily news podcast The Big Story, chatting with host Jordan Heath-Rawlings about the big fusion news from December, the public’s hunger for energy breakthroughs, and the energy revolution that’s going on before our very eyes while we get lost in sci-fi fantasies. It was fun! The team was kind enough to allow me to share it as an episode of Volts, so please enjoy, and go ahead and subscribe to The Big Story wherever you get your podcasts.Frequency Podcast NetworkYou're listening to a Frequency podcast network production in association with City News.Jordan Heath-RawlingsIf you've listened to this show for any length of time, you will know that we think scientific breakthroughs are cool, especially when they show us a path to a theoretically unlimited source of clean energy. When you look at the trouble we're in, it's easy to understand why anyone could get caught up in that height.Media soundbiteThe power that powers the sun, an abundant source of clean energy to help the planet kick its carbon addiction.This is one of the most impressive scientific feats of the 21st century.It's a star in a box. Putting it in a box on Earth and tapping that energy that goes forever. It's what Iron Man has in his chest.Jordan Heath-RawlingsNow, here is where I get to be a buzzkill. When a scientific breakthrough hits the mainstream media, it's important to look immediately to the people who have covered the sector before that breakthrough. They are the ones who can separate hype from hope. And while, as I said, the fusion breakthrough in December was legitimately cool, ask some of the people who have been covering clean energy and the climate crisis and they'll tell you a story of other technologies.The ones that we have right now, the ones that actually are changing the game we are currently playing and those people wonder why can't we focus on these things right now instead of waiting for a miracle? I'm Jordan Heath-Rawlings. This is "The Big Story". David Roberts runs a newsletter and a podcast called Volts, which discusses clean energy and politics. You can find it at volts.wtf. That is an interesting suffix for your website.David RobertsYes. I didn't even know it existed until I was trying to register a domain, and then I made a rather impulsive purchase.Jordan Heath-RawlingsWell, at least it's memorable. Now, before we get into what's going to happen in clean energy this year, which I'm really intrigued by, can you maybe quickly take us back to December? And I'm sure many people listening will remember a big headline and discussion about fusion. What was that news?David RobertsSure. The National Ignition Facility at the Lawrence Livermore National Laboratory has been experimenting with fusion for years and years now, and they just achieved a goal that they have been pursuing for a long time, which is they got more energy out of a fusion reaction than was put into it. And this is a big milestone in fusion research.Jordan Heath-RawlingsWhy is that milestone, theoretically at least, so important?David RobertsWell, you have to untangle a few things. In the big picture, the hope is that eventually you can master fusion to the point that it can create clean energy because the fuels required to run fusion are cheap and abundant, it's carbon free. Theoretically, fusion power plants would have a very small footprint. So, from the energy perspective it's sort of this tantalizing utopian energy source. In the actual fusion world, the Lawrence Livermore Lab is not even in the business of researching fusion for energy production. They're actually more geared toward weapons research. There are other fusion companies pursuing energy production, but they use actually a fundamentally different technology, a fundamentally different form of fusion which has not reached this threshold, this breakthrough.But there's lots of companies pursuing fusion and depending on how seriously you take their hype, maybe they'll be producing actual power plants that produce actual energy in a decade. Some of them are saying earlier than that, but they're also trying to raise money so one doesn't know how seriously to take them. But one thing to keep in mind is the Lawrence Livermore Facility costs about a billion dollars to create this small amount of energy it created. And the alternative forms of fusion claim that they will be able to create power plants for merely hundreds of millions of dollars. So, all of this is speculative and distant, let's say.Jordan Heath-RawlingsWell yeah, I mean we used theoretically a lot there, there's a lot of caveats I noticed that you kind of threw into your description of what could happen. But nevertheless, we begin the conversation here because I want you to tell me just a bit about how this went over in the mainstream news cycle because as I mentioned, this was a big deal in early December, right?David RobertsWell, there's a vision that has a hold of people's imagination of abundant clean energy produced in small power plants. And if you have sort of...Jordan Heath-RawlingsLike Sim CityDavid RobertsLike Sim City. And if you have limitless energy with barely any fuel and no waste, there's all sorts of things you can think of you could do with limitless energy. You could for instance, desalinate water at scale with something which costs a lot of money and energy now. You could grow endless food. There's all kinds of stuff you can do if you have surplus abundant energy which fills people's heads with these sort of utopian futuristic visions.And that vision I think, ends up causing people to sort of clutch to any announcement like this and say oh it's it's closer, it's going to happen, you know. But like fusion, fusion research has been sort of going through Hype cycles ever since 1950, mainly because of this Sci-Fi vision in people's heads. But you know, it just needs to be said over and over again. We are still very very far from that utopian vision of energy production. And, I would just like to remind everyone that we're in a climate crisis and we do not have decades to wait on an abundant source of clean energy.So, even if the most sort of aggressive forecast, even if everything went very well, this is going to start generating energy well after the point that we need to have largely decarbonized already. So, there's sort of two categories people can think about. There's the near term decarbonization imperative and this is not particularly relevant to that. And then there's like the long term, post 2100 futuristic, "mankind expands to fill the solar system", all this kind of whatever your Sci-Fi stuff. And this is relevant to that, but we need to keep those two separate.Jordan Heath-RawlingsSo that's why I came to you, because you've been writing about clean energy and politics for years now, as you've said, more than a decade, and you wrote a Twitter thread about this discovery that kind of opened my eyes a bit. So I'm just going to read out the first tweet to you and get you to explain your thinking to our audience. "It drives me crazy that people are still pining away for some magic blue light arc reactor Sci-Fi energy source to save us when solar and wind are out there doing it as we speak". What are you getting at?David RobertsYeah, you know there's a lot here, but where I'd start is we have wind and solar right now. We have renewable energy. And when I say renewable energy, I mean wind and solar and all the sort of attendant technologies that enable them making huge progress right now. But it's difficult progress and it's a big political fight. You're fighting at the national level, you're fighting at the community level. There's a lot of community resistance to renewable energy now. So it's just a struggle and a slog to transform the energy system around renewable energy. And I think a lot of people imagine, or maybe wish that if you had this Sci-Fi energy that could produce all the energy you want with hardly any input and no problems, you could in effect skip the politics of transforming the energy system.You could do it without politics. I think there's a real, especially among sort of, let's say tech nerds, and I say that with love. I love tech nerds. I think there's a real sort of anti politics at work here. This idea that the sort of grubby work of negotiation and compromise and half steps forward, it's all very frustrating, it's very ambiguous. I think they just are naturally sort of repelled by it and they sort of imagine ways around it, imagine ways you could improve humanities a lot without politics. And this sort of tendency comes up over and over again in a lot of different areas. It expresses itself in a lot of different ways.But I think this is a classic case, this idea that fusion could, in a sense, short circuit all these politics or skip all these politics and just sort of transform everything without anybody being upset, without anybody fighting about it. And that's just, I just push back against that again and again wherever I see it. Even if we created this magic energy source, even if fusion somehow miraculously developed enough to not just create a positive amount of energy, but to create a lot positive amount of energy at a cost that's even remotely competitive, with current energy sources. To take that and transform the world energy system with it would still require a lot of fighting and a lot of politics and a lot of slog.There is no way around politics. You've got to go through it. And that's why I think, despite the sort of spectacular success of wind and solar in the past decade, people still sort of resist it and want to poopoo it because it's just hard. It's just hard. And it feels like it's going to require too much work. You have to transform too many things. You have to transform the grid. You have to develop all these storage technologies to complement it. It requires a sort of wholesale rethinking of the energy grid. And that's just going to disturb a lot of incumbents.It's going to be a lot of change. And people just have a very, very instinctive, brainstem level aversion to change, basically, or to transformation. And that's what I think is expressing itself here.Jordan Heath-RawlingsWind and solar have seen tremendous success over the past decade. How has our reliance on wind and solar been growing? What does that tremendous success look like? Like, just in general, you know, how far have we come with these since, I don't know, 2010?David RobertsSure, there's a lot of different ways to look at it. If you're just looking at the technologies themselves, they have plunged in cost. If you look at these graphs of the cost of wind and onshore solar, that's just a steep downhill for decades now. And now we are at the point that wind and solar are creating are the cheapest forms of electricity. The electricity they generate is the cheapest electricity in the world. And that's with or without subsidies. I don't think this has fully sunk into people's heads yet. It is the cheapest way to produce energy.They're still early in their deployment and spread. So it's only like, I think solar is like 2% of US energy. It's more elsewhere. I think if you live in Denmark, I think they're getting close to 50 plus percent wind and solar there in that country. So they still early in their march to take over the electricity system. But in terms of cost, they're just dirt cheap now. So that's why, you know people wonder, why do you want to transform the energy system around sources that come and go with the weather, right? The idea is they're not reliable, you can't turn them on and off at will, they come and go with the weather.Why would you want to use that? The reason you would want to use that is because it's dirt cheap. So even with all the sort of balancing technologies you need, and even with all the changes you need in the grid to accommodate that variability, it's still way cheaper than the alternative. So we now have, and this is totally different than 2010 when we used to discuss decarbonisation in 2010, as I was, it was all Sci-Fi, I mean it was all speculative. Wind and solar were ridiculously expensive, and the technologies that would enable the grid to accommodate more wind and solar were nascent.And so, the whole thing was sort of batting back and forth speculative possibilities. But now, we have a clear trajectory toward decarbonizing grids. We know how to do it now, and we have the technology that is cheap enough to do it now. People say, well, you can't get to 100% clean energy just using renewables. And that's true. To get from say, 85, 90 percent to a 100 percent is tricky from our current perspective. We don't know quite yet how we're going to do that, but as I constantly tell people, we're not even close to 85 or 90 percent yet, so we've got a lot of runway , and we know how to get to that level.And by the time we get to 85, 90 percent, tech development will have been preceding a pace , and we'll probably have a much better idea by then how to get to 100. So, there's been this revolution in clean energy that's been happening right in front of our eyes. And it's always strange to me that people want to have this weird urge to resist it or to poo poo it or to find flaws in it, you know what I mean?Jordan Heath-RawlingsBecause it's not magic.David RobertsI guess that's it. And I think also it comes back to the politics. Today's grid is built for big centralized, dispatchable energy sources, because that's mainly what we had for most of the history of electricity. So, the grid today is still, and not only the grid physically is built for that, our rules and our regulations and our laws and our practices and utility practices and all this stuff have that hangover, are still built around sort of hub and spoke big power plants sending power out to sort of dumb consumers. To change that system, you have to make the grid much more sophisticated.You have to accommodate the fact that end users are now creating, generating energy on their own. They can generate energy on their own, they can store energy on their own, they can trade it with one another without ever dealing with that central source. We just need a much smarter grid. You need much more grid, right? Because if you're reliant on the weather and sun. You have to build the power plants where the sun and wind are, which are not necessarily where people are. So, you got to build a lot more long-distance transmission. You need a lot of transformative.You need to transform the grid along with spreading wind and solar. And that is hard, and it's a fight, and it's kind of a drag. Like anything in politics, it's a slog. And I think that's one reason people sort of resist the good news that's happening, unfolding all around us.Jordan Heath-RawlingsHas the politics been getting easier though? You just kind of walked us through this massive amount of progress. I would hope at least that as the price plummets and as it continues to be more reliable again, I'm not expecting the magic solution, I'm not expecting the politics to go away. But theoretically this transition gets easier as momentum builds, right?David RobertsWell, in some ways yes and in some ways no. Wind and solar are on what are called learning curves, which means every time you double the amount deployed, costs fall by a very predictable percentage. And that sort of ratio has held steady for decades now. So, it's pretty reliable and predictable. Which means if we continue doubling deployment to the point we need to completely decarbonize grids, it's going to get super cheap. Not only cheap like it is today, but like super dirt cheap, trivially cheap. So, there might be magic, right? There might be some magic on the horizon.People have been underestimating the fall in costs of renewable energy at every stage for decades now. If you look at the sort of official forecasts from the International Energy Agency or the US EIA, all these modeling bodies, they keep predicting over and over again that the costs are going to level out, plateau, right? They're going to stop falling, and they just don't stop falling. They just haven't stopped falling.Are they like the people that kept predicting there would be a limit to what we could put on a computer chip and that laptops would never get... Like all this stuff. This is the same science, right?Yes, exactly. Very confidently predicting that we couldn't do those things, right? I mean, it was not that long ago that people were very confidently saying a grid cannot accommodate more than three or four or 5% variable renewables before it starts falling apart and becoming unreliable. And we just shot right past that, right? Every supposed limit of renewable energy that people have been confidently pontificating about for the last two decades, we've shot right past those. It's defied all those. So, that's going to continue. And as it gets cheaper and cheaper, it gets easier and easier in some ways just because people like cheap business, people like cheap, like investors are going to go invest in the cheap thing, whatever the sort of team sports people have around different energy sources are irrelevant to big money.Big money just goes where the cheap stuff is, right? And it's going to follow renewable energy. That's true. But on the other hand, once we start building these out in real bulk, once we start getting from like 5% to 50%, you're going to need a lot of wind and solar build out and that happens on land and people live on land. And so, these fights about building stuff, and the US sort of famously has difficulty building big stuff these days because we have this thicket of rules. We have this sort of absurd degree of community. Communities are just able to stop things in their tracks, use laws that were originally designed for environmental protection to slow things down. It's really getting even more into the sort of yard by yard fight of politics.You have to overcome community resistance to get to the really high numbers. So in a sense, that politics is only starting. It's only going to get harder and harder. So, how those two things interact is anybody's guess. But I will say that the momentum of renewable energy and its attendant sort of balancing technologies, the storage, throw in some geothermal, whatever, throw in some thermal storage and the technologies that make it work have developed a momentum at this point that is effectively unstoppable. Like we are going to transform the grid around renewable energy on some time horizon.It's just as always climate change looms in the background, and we just do not have time to mess about. And this is another thing that drives me crazy about fusion. They're like, "oh, in a couple of decades we'll have limitless energy". I was like, we just don't have time. We do not have time to wait a couple of decades. In a couple of decades we're going to be living... In a couple of decades, we're going to be suffering under climate change in a much more visceral way than we are today. Climate change is going to be to the point that its tipping points are going to be looming closer and closer.We just don't have time to waste. We have to start, we need to decarbonize the US grid by 2030. That's the sort of target we've laid out in Paris. And if you ask me, I mean, I'll bet any amount of money, there is not going to be a commercially viable fusion reactor generating electricity by 2030. I will bet anybody any amount of money about that.Jordan Heath-RawlingsSo last question then. What is the next big breakthrough? And, I don't necessarily mean like magic bullet like, oh, we did this fusion reaction, but where's the next big milestone, or where's the next big thing that you're looking for that will kind of tell you something is shifted?David RobertsWell, unfortunately for those of us in media, the real development of the energy system is almost always incremental, right? That's how it's always been. It's probably how it's always going to be. There are very few legitimate, sort of like, turning points or markers that you can celebrate. So, wind and solar is just going to continue getting cheaper and cheaper. What I think where we need to look for exciting tech developments are in these balancing technologies, right? If the core, if the bulk of your energy is wind and solar, they are variable, they come and go with the weather, so you need balancing technologies.So, that's storage. I think there's a ton of work going on in storage right now. I expect some big things out of the storage community soon. And another place to look, I think, for possible breakthrough is geothermal technology. So, right now there's such a thing as geothermal electricity where you just sort of find places where there's volcanic activity underground and you stick a tube down there and get hot steam out. But, currently under development are all sorts of ways where you can dig down and kind of fracture the rock and in a sense create your own source of heat down there, which you could do anywhere, right?You can only find volcanic activity in some places, but if you can dig deep enough you can find heat anywhere. And there's a lot of work underway about deep geothermal. I mean, people are down there drilling now with lasers and sound waves and there's all sorts of crazy Sci-Fi stuff going on in geothermal right now, and I would expect some big announcements out of that. And geothermal is a) renewable and b) always on, right? It's not variable, it doesn't come and go with the weather. So, it's a great complement to renewables in a sense. It is the same complement to renewables that is currently the role that is currently being played by natural gas, right?We got to get rid of the natural gas. We got to replace that with something. And geothermal, I think, is kind of a dark horse candidate for big breakthroughs. That will be awesome, and then I think there will be amazing breakthroughs on the demand side. People constantly overlook the demand side. When you think about how to balance out renewable energy technologies, people are always looking at different energy sources. But there are tons of ways to be more sophisticated about when and where we consume energy. So, we can shift demand to times when there is more renewable energy on the grid - by storing it, by sharing it, by moving it around.Just think about your humble sort of home water heater, right? You don't care when the water is heated as long as it's hot when you need it, right? So, you can shift the time you heat the water and the water heater to match times of abundant renewable energy. And you can do the same with every appliance with EVs, this sort of using electric vehicles as a kind of distributed storage technology that helps the grid, that's just nascent right now. That's just in its early stages. So, you're going to see a ton of interesting developments in sort of digitized smart demand management.And all these things are going to be incremental. They're all going to come together in unpredictable ways. But I would just say, people are saying fusion is like exciting science in a way that renewable energy isn't, and I just don't get that. Right now, there are thousands and thousands and thousands of people out there in labs doing demonstration projects, working on various problems around renewable energy, and it's just never been a more interesting time to follow technology. I just have faith that, like, there are more people than ever working on this stuff. And the more brain power we throw at it, the faster developments are going to be.So, it's just going to be an absolutely fascinating decade to live through in the energy world, fusion entirely aside. Just pay attention to sort of like thermal storage, it's super interesting. That's nascent. Demand management is nascent in a sense. All storage technology is just at the start. Geothermal is nascent. There are going to be amazing developments in all these areas and they're going to interact in sort of ways and have emergent effects that are unpredictable now. It's just fascinating. If you're fascinated by science and technology development, you don't need fusion Sci-Fi stuff. There's stuff going on all around you right now, just like tune in.Jordan Heath-RawlingsDavid, thank you so much for this. It's fascinating.David RobertsThank you, Jordan.Jordan Heath-RawlingsDavid Roberts is the author and host of Volts, which you can find at volts.wtf. That was "The Big Story". For more you can head to thebigstorypodcast.ca. I know, I usually talk about the podcast in this space, but since they will never ever let me do an episode about this, I just have to say: Don't sleep on the Detroit Lions. That's all. You can talk to us if you want to, especially about the lions, by finding us on Twitter @thebigstoryfpn, by emailing us hello@thebigstorypodcast.ca, and of course, by calling us. Leave us a voicemail: 416-935-5935. It's old-fashioned, but it's nice to hear from you.The Big Story is available in every podcast player, as you know by now. You can hear us ad-free in Apple if you want to subscribe to "The Big Story Plus". And you can get us for free five days a week on your smart speaker by asking it to play "The Big Story" podcast. Thanks for listening. I'm Jordan Heath-Rawlings. We'll talk tomorrow. 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, author Stephen Markley discusses his new novel, The Deluge, which describes a future affected by climate change that hits uncomfortably close to home.(PDF transcript)(Active transcript)Text transcript:David RobertsIn 2018, author Stephen Markley won near-universal critical praise with his debut novel Ohio, a tight set piece that takes place over the course of a single night, as four high school classmates reunite at a diner in their northeastern Ohio hometown. “Four characters, one night” is pretty much the opposite of Markley’s sprawling new novel The Deluge, which tracks dozens of characters over the course of decades, from the 2010s out past 2040, everyone from climate activists to scientists to political operatives, as they suffer the effects of climate change (there are some quasi-biblical disasters) and struggle to marshal the political will to address it.The novel crucially involves climate policy, reactionary backlashes, and direct activism, among other topics of great interest to the Volts audience. On Thursday January 12th at Seattle’s Third Place Books, I was lucky enough to talk to Markley about the genesis of the novel, some of its major themes, and the difficulties he faced in writing it.The crew at Third Place was kind enough to record the event (thanks Spencer!), so I'm happy to bring it to you as an episode of Volts. Please enjoy, and while you're at it, do the smart thing and buy copies of The Deluge for all the readers in your life.Third Place Books StaffPlease join me in welcoming Stephen Markley and David Roberts to Third Place Books. David RobertsWhere to begin? I'm just going to jump right in asking Stephen questions because I have nothing interesting to say. So, I've been writing nonfiction my whole life and have thought periodically about writing fiction—like every nonfiction author does—and even took a while one summer or one time when I had some time off to sort of sit and stare at the screen for a while and think about doing it. I had kind of a plot for a near future quasi-scifi thing, and there are tons and tons of reasons why I very quickly concluded that I was not suited to writing fiction.But one of them was the one I still think about, which is just: "What does the near future look like?" And the more I thought about that, the more I thought, "Boy, I have no idea at all what the near future looks like." I mean, I guess you could say that at any time in history, but it seems like particularly now, there's just so much crazy s**t going on. It's really like, how is it all going to interact and play out? And I found myself completely daunted and shut down by that problem.So here you are. You have decided to start a novel basically two years in the past, and then literally just detail what happens—not in some fictional world or some far off world—what happens in this world among these people in this country over the next two, four, six, ten years in detail. And that just strikes me as just, like, fictionally speaking, the highest conceivable level of difficulty that you could set yourself. Why do that? In the book that we talked a little bit beforehand, you were thinking about even before Ohio, it just seems like the hardest thing you could do. Why not write a couple of easy books to start with?Stephen MarkleyYeah, it all breezed by. It all went super easy and nothing surprised me. Yeah, it just came pouring out with no...nothing got in the way, historically or politically, that made... Yeah, no, it was an incredibly high degree of difficulty for the reasons you said. And all the problems of writing a 1,000-page novel, combined with the problems of it has to feel absolutely realistic at the moment of its publication. It has to feel as if it's our world sliding into this next world, right. At dinner, we were talking, I started the book in 2010, at roughly the same time as "Ohio," had to set it aside when "Ohio" was published, and then came back to it in 2017. So in that time, I don't know if you guys heard, a game show host actually got elected president. And so, the terrifying presidential character I was returning to was suddenly really unrealistic in his bombasticness. Because, like the real thing was much...David RobertsThere's a relatively muted fascist president in your book, looking at it from our present vantage point.Stephen MarkleyI mean, look, it was a mind-blowing project for me because I had to keep paying attention to every little detail of what was happening in climate, technology, politics, our society. And unfortunately, I had found the right veins, clearly, just in terms of how our politics were developing. And that just felt like it accelerated so quickly. And then with climate policy, I think that was another, sort of, murky issue. You've talked about on your podcast before, where there was this dead period after Waxman-Markey failed in the Obama administration, where it felt like everybody was throwing up their hands. And I think that was a tough place to be to...like thinking about the future of where policy would head or how it might develop.David RobertsYeah. And speaking of difficulty, sort of as you're writing and finishing, finally, Democrats are back in control and coming back to climate policy and debating the Build Back Better bill and then, specifically, the climate bill and, specifically, during that exact time period you were finishing, Joe Manchin was noodling around...Stephen MarkleyPrevaricating, let's say.David Roberts...prevaricating and noodling around and making everybody wait and wonder. And it was just wildly uncertain right up until the day he woke up on the right side of the yacht, I guess, or whatever happened. But right up until that day, it was just wildly unclear what was going to happen. It was a very big, sort of, historical pivot that was on the line. And it literally...that historical pivot took place during the years covered by your book. So, did this keep you awake at night, the course of actual events?Stephen MarkleyYeah, and I mean, in a way, when it passed, I was like both sobbing with relief and pissed at the Democrats. Like, "You should have let this fail so my novel would make more sense." Actually, what happened was I had fourth pass, like the last pass in my hands at the moment Joe Manchin was like, "I'm out on this bill. It's not happening." Right. So I send the book off to the publisher. I'm listening to people, like, cry on podcasts about our dark future, and then the bill passes. So what is going to be the case in the next edition?There are some key sentences that will be changed to reflect the reality of the Inflation Reduction Act passing. So this is just a way of me selling more books. You got to get the first edition and then come back to the next edition and buy that one too.David RobertsYeah, that's wild, it just goes to the difficulty, like I said, you're writing about things that are literally happening as you're writing them.Stephen MarkleyBut just to add to that, there was this sense, though, that people were paying attention, understood the Democrats would pass a mostly carrots package if they could get the chance. There wasn't going to be a price on carbon, there wasn't going to be any standards. It was going to be something where we're just going to toss as much money as possible at decarbonization. And so I think having that in mind, I could at least sort of point the direction of what would happen in the Biden administration. Although I do think the language in the book is currently unfair to the enormity of that policy that got passed.David RobertsI actually had that thought and then I remembered, like, "This is a novel." So, the other thing that you have to worry about in the real world is, of course, science and climate science. And this is something else that breaks my brain when I think about trying to do what you did, which is fictionalize it. Because if you are of an analytic mind, you follow climate science. Climate scientists, like all scientists, will say, "Here's the range of things that could happen," right? "Here are a set of error bars, a set of probabilities." And if you go to a scientist and say, "Well, here's what's going to happen. There's going to be a storm X big in 2029 in August." They'll just be like, "You're insane" if you try to...from a scientific point of view, it's crazy to try to say, "This particular thing will happen instead of that particular thing." So how much did you let kind of a worry about scientific plausibility...because the weather plays a huge role in the book. It's a big character throughout the book. There very key weather events.And how much did you let it worry you whether those particular events happening on that particular schedule were plausible to scientists? Like did you do a lot of going back and forth with science?Stephen MarkleyYeah, I did. And I think what I landed on is: I'm going to take the edge events as far as realism...to the end of the line, particularly with some stuff happening in Los Angeles and a storm that comes towards the end of the book. I think for me, it was like, "could this happen?" Not, "Is this probably going to happen." At the same time, you guys live in the Pacific Northwest, there was a heat event here a few years ago, and there was a quote by this guy's studied at Lawrence Livermore, I think, which was, "This event was impossible without climate change. It also was impossible with climate change." Like, it broke the model, the heat storm in the Pacific Northwest in '21. And so I think—and correct me if I'm wrong—we're continuously seeing is events outpacing the models that I find that particularly frightening.David RobertsYeah, and that gets to the difficulty of trying to pick a particular course of events, because even now we're being surprised and we're still in early, early stages of all this. The other big thing that gripped me throughout the novel, and it comes back and forth and up and down through the whole novel, the sort of the novel, insofar as it has a main character, is centered on an activist who gets into first, activism. There's a lot of activism working with politicians and trying to craft bills and create coalitions. And then there's a whole, sort of, other splinter of activism in the book, which goes very direct action...Stephen MarkleyAndre's mom-type.David RobertsYes. Which goes way down that road of direct action and bombing bulldozers and things like that. And it was interesting. This is probably not how you should read a novel, but I'm trying to squint and sort of figure out, like, "How does Steven really feel about activism and the role of activism?" I think you did a great job of certainly not coming down with any sort of pat-like pro or con, but, sort of, like there are key junctures in the book where activism screws everything up, like legitimately screws up and forestalls the possibility of good things happening.And then there are other, sort of, the larger sweep of the book. If you look at the whole thing, like, activism clearly played a big role. So what are your thoughts on the mom...Andre's Mom question, the sort of direct action? At what point is violence against property justified? And then another question that comes up later, which is: at what point is violence against people justified? It gets bad enough that that question is thrust on the activists. So I don't know if you have...where you come down on that.Stephen MarkleyWell, I think it's important to know...the job of the fiction writer. It's, like, none of these characters can share my point of view, right? Like that is that's the path to hell. That's the path to creating a character that's just your mouthpiece, right? So every character, you have to be, like, deeply in their perspective and see the world through them. So I feel like the way the book should work is if—Shane is the character you're referring to—when you're in Shane's sections, her point of view makes sense. These mealy-mouthed activists that...they're not getting anything done.We have to go after pipelines, right? Then you switch over to this other set of people and they're thinking, "These people are f*****g it up for us. They are creating a situation in which, basically we're going to get a Patriot Act for environmental activists and so forth. So I think just also, all of those sections are about unintended consequences. And I think that's something incredibly important to pay attention to in terms of how the structure of the plot works. Whereas just because you want to do something doesn't mean the thing you're doing is going to pan out the way you think it will.David RobertsYeah, I mean, even at the end of the book, looking back on it, there's still not a clear story to tell about activism was the good guy or the bad guy in the story. In a sense, everybody is kind of f*****g up all the time. Your activists, your scientists, your politicians.Stephen MarkleyI write realism.David RobertsNone of them really know what they're doing. Nothing works out the way any of them intend. I thought you captured that effect well, like, there's no masterminds.Stephen MarkleyYeah, but I do think that there is, at least my sense of the question is that we are all trying to point ourselves in the direction of, like, "How do we change this? How do we f*****g turn the ship? At least a fifth of the degree here, fifth a degree there." And so, in the end, I think all of these characters are pointing to the way in which the ship was turned by those incremental degrees. And even if many things backfired and many things didn't work, and the consequences were sometimes very scary or horrific, it's like trying to look at the aggregate of what has happened and how to change the situation.David RobertsYeah. It's like the aggregate that comes across. And even with the sort of benefit of hindsight, have finished the book, I'm still not sure I could go back and say to any one of the characters, "This is definitely something you should have done, or this is something you shouldn't have done." It's not even clear, even in the context of the novel, what ends up actually causing things to happen. It's just sort of like, things grind on around, which I thought is a very realistic...as someone who's seen people cast themselves on the shore of these efforts over and over again and nothing work out and lose hope. In a sense, it's hopeful. In a sense, it sort of gets at what's so frustrating about all of it, right?Stephen MarkleyFrustrating being...David RobertsThere's no A to B causation.Stephen MarkleyYeah, no, absolutely.David RobertsSo, the third sort of theme of the book that felt like it was written just for me, stuff I think about constantly is the role played by sort of far-right reactionary backlash. And I was so glad to find that in the book. There's a lot I can't predict, but the one thing I feel pretty sure about is that insofar as efforts to deal with climate change get some muscle or some seriousness, there's going to be equal and opposite reaction worse than what we're already seeing. Speaking of things being ahead of our schedule. So how do you think about it? Do you think that's inevitable?Stephen Markley100%. Yeah, I think death taxes and reactionary backlash are the only things we can be certain of. One of the things that has bothered me sometimes about, anything you watch on TV with politics, anything you read, any fictional setting, is the de-politicized nature of it. That's incredibly irritating because we live in an incredibly politicized environment. So, my only goal with the book was to, sort of, not to write it from the guy who voted for Bernie Sanders and Joe Biden's perspective. This is not, again, my mouthpiece. It's like, how can politics develop, surprise us? How can they swing around in ways that we don't see coming now, but might happen in the future?And so there's a character, a Republican president who wants to do something about climate change. There's a Democrat who behaves like a monster. There's all that stuff, sort of, in the way our politics now continues to shock us, like making sure to keep the reader off balance, right?David RobertsYeah. I got to say, that Republican president doing something good on climate change.Stephen MarkleyI knew you would hate that. Even as I was writing it in 2015, reading David on Vox, I was like, "I know he's not going to like this. When he finally interviews me in Seattle."David RobertsThat was the one time where my eyebrow went up. I was yeah, and then, of course, everything falls apart on her. I was like, "Yeah, that makes a lot more sense."Stephen MarkleyYou see what I was doing.David RobertsEverything falls apart after all. Another big question—I'm hitting you with all the big themes here—is, again, maybe you try to keep your point of view out of it and just put a lot of things in people's mouths. But the net effect of the book is a critique of capitalism, basically. This idea that climate is not isolated, unique, technical problem. It is an outgrowth of the basic way our socio and economic system works.Is that you? How much of that is you and how much of that is activists?Stephen MarkleyI think if I had to distill my critique of the world into a few sentences, yeah, that would be somewhat difficult, but I think what climate represents is it's not just a crisis of, "oh, we're doing this or doing that wrong." It's like there's a lot wrong with our system that we do recognize, right? And so, as you often say, the point of solving the climate crisis is not just so we can fly around on private jets and keep the world as this inequitable and this miserable. The solutions to the climate crisis point the way forward into actually changing the world for the better in many, many ways.And what I think your podcast does so well is explicate that. I'm going to use this little moment to talk about this guy just because...no, you have to suffer through it, you just have to.David RobertsTurn off his mic.Stephen MarkleyNo, because I started reading David before I even started the book, when he was at Grist and he was one of the first climate writers I encountered who had such a clear-eyed view of the issue and, sort of, left the moralizing elements of it to the side. And since then, basically a David Roberts' completist. Like, I've been reading him the entire time, even when he went to Vox for the down years.David RobertsThis is very embarrassing.Stephen MarkleyNo. But anyway, you should check out Volts if you haven't. It's an incredible podcast. When he brings on people who talk about how we solve this. It's like one of the few moments in my day when I'm like, "Okay, there are a lot of smart, passionate and incredibly just intelligent people working on every element of this problem." And I think that's something to keep in mind when we talk about this really scary thing.David RobertsYeah, it's actually...one of the things you didn't get into that I wondered about was the role...like, one story people tell now about how this is all going to play out is that clean energy is getting cheaperly fast and the markets, people are going to start opting for these things for market reasons and basically, like, the cleverness of innovators and entrepreneurs are going to turn markets for us and save us from ourselves. There was very little of that in the book, I take it you just don't credit that.Stephen MarkleyNo, that's not quite the case. I think the whole experience of writing it, that was not happening yet, or it was happening, but it was like slower. It's really turned up in the last few years and so for me, it was just like, no introducing geothermal energy that suddenly solves all our problems. I couldn't slip that in and pretend like this is going to be the solution, even though, who the f**k knows, maybe it will.David RobertsWho knows?Stephen MarkleyRight. So, I just think that was an element of the book that, sort of, I was not eager to shove into it. At the same time, I have become more excited about the possibility that stupid capitalism is actually on our side, suddenly.Aand at the same time, I do feel like these incumbent industries, fossil fuels, are going to put up a way more voracious fight than a lot of people are thinking about right now.David RobertsYeah, one of the striking things about your book is they don't quit. The Eastern seaboard basically gets flooded and they still don't quit.Stephen MarkleyI mean, look, they're going around I would listen to that podcast with what the gentleman who was talking about...they're going around to a bunch of communities trying to gin up resistance to clean energy that will benefit those communities. And they're just really good at it.David RobertsYeah, they are good at it. So, I want to get to audience questions before too awful long, but speaking of—this kind of gets back to the capitalism thing—sort of at the end—if we can do this without spoilers—you could have, very easily, I think, and very plausibly, ended this with sort of everything falling apart and everyone dying. Just, sort of, like dissolution on the horizon as far as you look, and that would have been 100% defensible. So how much did you...this is like the most cliché question in the world.Stephen MarkleyI can't wait.David RobertsHow much did you worry about, "Do I want people to throw themselves out of a window after I read this book? Or to what extent do I need a happy ending?" Insofar as you can call a story where hundreds of thousands of people are dying and getting driven out of their homes and migrating and whatever else, happy.Stephen MarkleyRight, but we're in this very bizarre situation now where we're talking about stopping the heating of the planet at two degrees is the happy ending, which seems insane. And so I guess the book, without spoiling anything, the book lands on a knife's edge, right. It's pretty much exactly what we're looking at right now, which is: we have every tool we need to rapidly decarbonize the global economy. We could be growing much faster. Some of the terrifying results are already baked in because we waited too long and it's going to be, you know, the fight of several generations to turn this thing around.And I just think, like, the book ends as really that effort has gotten underway at the scale that it actually needs to affect the correct change, though.David RobertsYeah, it takes quite a few body blows before that comes around. Another thing, I really appreciate it in the book, I felt this about, "Don't Look Up 2" the movie. Anytime you tell me a work of fiction is about climate change, I go in pre-grimacing and do it completely tensed up.Stephen MarkleyMe too.David RobertsCompletely tensed up stuff, watching for...it's, like a doctor watching ER or whatever. You catch all the little things. But one thing I was glad you didn't do is this notion that once a disaster is big enough, right. Once there's a spectacular headlining, grabbing enough disaster, it's like a shock. And then everybody is like, "Oh, you're right, we do need to do something about this." And everybody swings around and gets supportive. And as you show in the book—show rather than tell, which I appreciated—it causes some people to do that, but it causes just as many other people react to trauma with fear and nativism and nationalism and anger.Stephen MarkleyI think the most important thread in the book is, there's one of the sections is called "Feedbacks." And feedbacks, we all know what climate feedbacks are, but the most important feedback is us as humans is what are we going to do? And unfortunately, one of those feedbacks is the worse things get, the more of that starts to come out. And it's just even more reason to arrest this as quickly as possible because those effects will accrue that kind of resentment, nativism, hostility. It's so inevitable. And so I think making sure that was ever present in the book was, sort of, a key thematic aim.David RobertsYeah, there's a president who runs on...this is something I've had in my head for a long time. A president who runs on like, "We need to put up big walls to keep all these migrants out, and we need to hoard our fossil fuels and dig up all our fossil fuels."Stephen MarkleyCarbon maximalism is the name of the...David RobertsWe have an island here, a walled island, and we're protected from the rest of the world going to hell. And of course, it doesn't and can't work, but 100% plausible that someone...Stephen Markley2024 will probably bring about that candidate.David RobertsYeah, you got to wonder.Stephen MarkleyYou're shaking your head, but, y'know.David RobertsOkay, well, I want to hear from y'all, so if anyone has questions, please. The question was, "How far out into the future does the novel go?"Stephen MarkleyIt ends in the 2040s, so it starts in our recent recognizable past, 2013. So we get like, a taste of where we've all been and then ends in the 2040s.David RobertsYeah, it really is like present day, you're familiar with, marching right forward to your tomorrow and the day after tomorrow. It's very disturbing in that way...how smoothly it goes from a very familiar situation to things going fucked up in sideways in all kinds of ways.So the question is about this perpetual argument in the climate space over individual action and individual responsibility versus structural infrastructural political changes. And as a god-like narrator, you get to choose which of those works more in the end. Did you have that in your head as you were writing?Stephen MarkleyYeah. There's no point in the book when flight-shaming solves anything that's actually...David RobertsPlastic recycling, though.Stephen MarkleyYeah, right. I'm sure we share this sense, which is very quickly into my very basic intellectual encounter with the climate crisis, even back in when I was in college, was like, "Oh, all this stuff is like, mostly virtue signaling garbage." And that's not to say, like, people should live their lives as ethically as they can and they want to like I don't want to like, denigrate anybody who does that stuff. It's just that, like, chirping about it doesn't help anything. We really, really need to accrue political power and change things at system levels, as David often says. It's the most vital thing.David RobertsBut what about just a slight twist on the question, which is rather than personal action in the, "Buy a hemp tote bag, drive a Prius, to..."Stephen MarkleyHow to green your Netflix binge.David RobertsThat type of thing. What about personal responsibility for activism and political engagement?Stephen MarkleyI love that and I wish that was...what do they have memes now? I wish that was a meme somewhere on the Tiktok.David RobertsI think they're called memes. Anyone in the audience?Stephen MarkleyBecause it is. And just, you know, I was reading Hal Harvey's book, "The Big Fix," which I very much recommend, which is about this topic. And there's a story in Montgomery County, Maryland where a bunch of high school students were agitating about their disgusting diesel-fueled buses and it led to the county electrifying the bus fleet. And that seems like a small thing, but if you start multiplying that across school districts around the country, it's not a small thing. And it dovetails with the strategy that has emerged, which is electrify everything and crush demand for fossil fuels. So I think those are the sort of actions we have to look towards.And particularly cities like Seattle and LA and all these other sort of liberals, like bastions, can go a long way in implementing policy and nobody pays attention to any of this. So a little bit of action goes such a long way. Him back there?David RobertsThe question was, "If you, in a dark alley sometime, come face to face with a climate denier, is there anything in particular, any strategy or fact or emotional valence that you have found useful in moving such?"Stephen MarkleyYeah, so what I like to do is get super upset and really dive into all my facts and just present them in a logical way and get angrier and angrier as the conversation progresses.David RobertsDon't forget footnotes.Stephen MarkleyYeah. I pull up on my phone, articles from the New York Times and I'm like, "Wait, look, Paul Krugman says this," and that works every time and it's all fine. I think like I, you know, you don't have to say it's, like, look at the Exxon documents from the 1970s. Like they knew. tTheir scientists were out studying this. They said the world was going to go to hell if they kept doing what they were doing. So you don't have to take my opinion for it. You can go look at what Chevron had to say.But no, to seriously, answer your question, though, I do think the tech has suddenly become this very interesting tool, which is like, anybody who has an electric heat pump—my dad won't shut the f**k up about his electric heat pump. Not that he's a climate denier. But it's like they should put warnings on that, on electric heat pumps that say, "Your dad might talk about this for a year."David RobertsI know. Warning to your neighbors: Do not engage on the heat pump.Stephen MarkleyExactly. There are these ways of just saying, "you should at least try this thing out," that I think once people start experiencing this very better way of producing heat and energy, it will not move the needle on denialism, but it will at least maybe a little crack or a fisher here or fisher there.David RobertsYeah. If I could just add, like, I've been at this since early 2000s or whatever, and in the early 2000s, there weren't a lot of people who cared one way or the other. So it was mostly, like, a tiny handful of us who cared and a tiny handful of jackass deniers who were paid to disagree. And I spent several years going back and forth with them and quickly realized a couple of things. One is: if you find people who are invested in denying, they're usually that way ideologically, and you will not change their mind. And the right strategy is to turn around and walk in the other direction as fast as possible.The vastly larger problem is: poorly informed and mildly disengaged. Like, the vast bulk of people just don't know that much and don't care that much. And how to get them involved is a much, much bigger and more important question than how to turn around some jerk off.So the question was: what was most helpful to you in your research about how to address the problem? And I guess that can...because there is just for you have not read it. To my great delight, there are some pretty weeds-y discussions of policy. There are rooms full of people discussing policy in some detail, which is just totally my thing. Again, not allowed to mention me. What sources did you find helpful?Stephen MarkleyI just mentioned "The Big Fix," which was written by this guy, Hal Harvey. He's been on...I discovered him through David's writing, but he works at Energy Innovation, which is a think tank. They were advising Congress on the IRA. And I was so grateful a person who works there read the book for me and sort of advised me on everything. And I'm just so relieved that there are people who are like, "Alright, what is step A? Let's do step A, and then we'll move to step B, and then we'll go to C."And it's just that sort of level of thinking of, like, what are the things in society driving this crisis? How do we change them, right? I would be remiss also if I didn't recommend a book by my good friend Lisa Wells, who is here called "Believers." It is a terrific nonfiction book. I read it in the midst of writing "The Deluge" and it's like one of those books that sort of, like, made me feel what I'm supposed to feel right now in the midst of this. And I think that's, as we were saying, like, if that's a difficult thing to do, like all of this just sort of exists in this haze. And every once in a while there's in a weather event that freaks us out. But then we all go back to normal. And even those of us who care about it have a hard time sort of holding on to it. So I very much appreciated those books that I read that was like, no, no, this is keep your eye trained on this.David RobertsAnd of course, to add fiction is one of the things that can do that in a way that no nonfiction can. And sort of like reading about this scientist who's been discussing these very sort of cold, wonky things, the whole book careening through a burning Los Angeles to try to save his daughter from her apartment. It really makes things visceral for you.So the question is about why there was so little climate fiction or art for so long, and now it seems like it's kind of bubbling up now. There's a couple of big things popping out, really big ambitious works, and whether you have any thoughts on why that's happening. And I'll say, whenever I say on Twitter or whatever, "Oh, there's not enough climate art," people start throwing obscure climate art at me and obscure climate novels. But in terms of big, popular culture stuff, really, this book is the first because you'll get lots of books that are, like, dystopic and you're like, "Oh, it's like an analogy to climate change hovers in the background or whatever." This is about climate change more squarely than any work of art I've ever met. So what do you make of that?Stephen MarkleyI think it's bizarre as well. And it's sort of in the course of writing this book, I was somewhat terrified that someone would come along and preempt me with the same thing, basically. And it never really happened. And I don't know, I might get in trouble for this, but I'll just take you through this story. I work in Hollywood now, I don't know if you saw my picture with Tom Hanks. It's up on Instagram. Okay. But we went out with "The Deluge" early to see if we could gin up interest in an option.And I just got the same question in every meeting, right, which was basically to the effect of, like, "Well, what about the people who don't believe in climate? Like, I believe in climate change, but what about the people who don't? What's in this for them?" And I always found that, like, the most bizarre, mind-blowing thing, because when you're in it, you're like, this is the most important f*****g thing to ever happen to humans. Like, let alone...David RobertsYeah, like somebody proposing a pandemic movie. Like, we don't believe in pandemics.Stephen MarkleyRight? So to me, there is this weird still, and this is a testament to the power of the propaganda laid out by the fossil fuel industry. There is still, in the US especially, this sort of idea that it is this highly-politicized issue, which it is, but in a way that you can't even make art about it because it will prickle people. At least that's my Hollywood opinion. As for fiction, I think there are quite a few climate novels, but I think they do exactly what you're talking about a lot of the time, which is they're not addressing the issue, they're coming at it from allegory or whatever else it might be. And the project of "The Deluge" was like, okay, straight to the f*****g eye, let's do this. Let's get every issue in this complex subject on the table.David RobertsYeah, if you want an explanation for why there hasn't been, I just think because it's super f*****g hard. Like, climate is everything. It is literally everything. It's every fiscal system, every political system. It's like social system, it's emotional, it's allegorical, it's everything. So, it's one thing to understand that intellectually, but fiction is all about specificity. That's what I was trying to get out of my first question. Taking all that and deciding this specific thing, that's just mind blowing to me, and I understand entirely why people haven't done it. It sounds really hard. I'm still waiting for the first good climate movie. I don't know, "Don't Look Up" did this, sort of, like, analogy thing.Stephen MarkleyYeah, I mean, I listened to the podcast with...what's his face? Adam McKay, sorry.David RobertsMcKay, yes.Stephen MarkleyI hope he's listening to that right now.David RobertsFamed Academy Award winning director, Adam McKay. I expect in coming years there will be more attempts at this. I sort of hope that, you did the sort of needful, which is like directly grappling with the horns. But there's ways to get at this through genre. You could do a horror, you could do a heist movie. You can think of lots of different ways you could weave climate change in. That's what I'd like to see is not necessarily just a ton of stuff directly about climate change, but just more ambient climate change in culture. Just sort of more of an acknowledgement that it's whatever story you're telling and whatever you're doing, it's there. It's around you.Stephen MarkleySo, David, you're telling me you have not watched the film "Hurricane Heist"? Because that...David RobertsI have, actually!Stephen MarkleyYeah, see! What are you talking about? It's a classic, yeah.David RobertsI thought that movie was so terrible that literally no one else in the world would watch it. I'm glad you have the same appetite for terrible movies.Anybody else?Audience MemberBut did you sell the options?Stephen MarkleyNo, it's still available, Adam McKay.David RobertsDear Academy Award winning director Adam McKay...Stephen MarkleyYeah, back there.David RobertsSo the question is: was it cathartic to write this for a decade or did you find it innervating to wallow and apocalypse?Stephen MarkleyYeah, I definitely thought it was emotionally exhausting, and especially about at the 60% mark or maybe the 70% mark, when I had sort of set in motion the wheels of all these multi-faceted crises happening at once. And I just, like, it felt too real to myself. For me, really, like, the point when I had to shift my own thinking on it was when I started to explore, like, okay, who are the people out there actually trying to do something about this? Not setting their hair on fire, not bemoaning humans as a virus on the planet, but just like, what systems do we have to change in order to do this?That's when I started to orient myself a little bit more productively towards the task at hand. Then it was being edited in the middle of 2020 during the pandemic, during the riot of the Capitol, like, all that s**t that just seemed like, "okay, my book, it's, like, not scary enough," you know?David RobertsSo, yeah, what about the riot? What about January 6? That happens during the time period of the book, right?Stephen MarkleyEither way, without any spoilers, the way I found out about January 6 was my friend, an early reader texted me and said, "How does it feel to be clairvoyant?" And I did not enjoy turning on the television to find out what he meant.David RobertsWe'll leave it at that. You have to read the book. When will there be an audiobook and are you going to be involved in it?Stephen MarkleyIt is available right now, and I am not reading any of it. So, you can listen to better people than me.David RobertsAnybody else? Yeah, go ahead. Do you get into the role of animal agriculture in climate change in the book?Stephen MarkleyA bit through one of the most vociferous characters, who's a vegan and sort of forces her partner to become one, as most vegans do.David RobertsHello. There they are.Stephen MarkleyOh, wow. It's like that spot-on or something. But also there's this moment at the end when basically a character is laying out, okay, like, what do we do? And agricultural policy, of course, plays a role in that, yeah.David RobertsAm I dreaming? But people aren't eating beef by the end of the book for some reason? Am I making that up? It wasn't like a policy or anything. Just like, all the cows died, or I may be making stuff up at this point.Stephen MarkleyYeah, it's basically like the US government goes around buying up livestock and then basically shutters the industry, I think, is what you're...David RobertsYes, that happens. In that sense, something quite dramatic on that.Stephen MarkleyBut then you need to precipitate a crisis like in the book, and I think we need to avoid that. Yeah.David RobertsSo this is a question about writing process, and it is a big, sprawling book. It's got lots of characters in it, and the question is, sort of, how many is enough? How many is too many? How do you know when you're representing everything you want to represent. What's the thinking there?Stephen MarkleyHave you read "Ohio"? Okay, yeah. So with "Ohio," it's like I had the four characters the whole time and knew exactly who everybody was. With this, I probably started off with ten or eleven point of view characters. And as the book progressed, it became clear, like, you're biting off way more than you can chew. And so, they began to drop away. And I think in the last edit, basically, between me and my editor, I cut one more. It was hard because when...David RobertsDo you know how many you ended up with?It's seven, basically. But when you have to cut out a whole character, it hurts. It's like chopping off your arm, right? And so I think, like, that last hurdle of getting rid of...but the book had to move. It had to be, and I think it is, like, very readable, very page turnery. And I think that was something my editor and I discussed that was vital, that a book this size with this much policy and science and so many ideas packed into it, it really had to be aggressively interesting. And so a few of the characters who I thought were vital, it turns out they kind of weren't.Stephen MarkleyAnd once you've cut it, once it's gone, you don't miss your arm anymore.David RobertsNo phantom pains.Stephen MarkleyNo phantom pains.David RobertsYeah. I just want to say for those of you who have read Kim Stanley Robinson, "Ministry for the Future", I always want to say "Swiss Family Robinson." I don't know, once I say...Stephen MarkleyThat's a different type almost!David Roberts...like that's not It! "Ministry for the Future." "Ministry for the Future" is a very, like, it says fiction on the cover but it's, like, a little bit of fiction with a lot of, like, white papers sprinkled throughout, which is, like, great if you just want to learn. You'll learn a lot by reading it. But just to be clear, this is not that. This is an actual novel. An actual page-turner of a novel, and not just a bunch of learning, a bunch of briefs.Stephen MarkleyDavid Roberts. F**k learning.David RobertsYeah, enough with this learning. Thank you, everyone.Stephen MarkleyThank you so much for coming out. I really appreciate it. Thank 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