 Good afternoon. I'm delighted to see everybody here. I'm Susan Collins, the Gerald, the John and Sanford Wildein of the Gerald Ford School of Public Policy, and on behalf of the entire Ford School community, it's really wonderful to see so many people here to listen to a panel discussion on a very important topic. I have the pleasure of really welcoming you to the Ford School community, and we're looking forward to hearing from a very distinguished panel of guests, and I would like to personally welcome each of them as well. In particular, Commissioner Mark Spitzer, we are delighted to have you join us here today, Presidential Appointee to the Federal Energy Regulatory Commission. Rob Gramlich, we're delighted to have you as well from the American Wind Energy Association, and two of the Ford School's very own faculty members, Professor Barry Rabe and Meredith Vowley, delighted to have you part of the panel as well. We'll have more formal introductions in just a moment. Today's event is co-sponsored by other units on campus, in particular by the Law School and by the School of Natural Resources in the Environment, and I'm particularly delighted to be able to welcome here Rosina Bierbaum, who was really a driving force behind today's event and who is here with us, and always a pleasure to have you join us. Introducing and moderating today's panel this afternoon will be David Allman. David is the Jeffrey List Professor from Practice and the Founding Director of the Environmental Law and Policy Program here at the Law School, and with no further ado, please join me in welcoming David, who will make more formal introductions. Thank you again. Good afternoon. It's nice to see so many of you here. Thank you, Susan, for the kind introduction, and thank you to you and all of your colleagues here at the Ford School for hosting today's event. The Law School is very pleased to be co-sponsoring today's speaker and panel discussion with our friends at the Ford School and at the School of Natural Resources and the Environment. There is, I think it goes without saying, no issue that's more important from an environmental standpoint today than addressing the problem of global climate change. And when we talk about global climate change issues, all the discussion quickly moves to consideration of alternative energy and how we develop renewable energy, how we reduce fossil fuel use, how we address the problem of carbon dioxide emissions and their effect on the environment. So with all of those issues surrounding us and a center of many of our research agendas, it's a particular delight for us to have a speaker today who can speak with a great deal of background and knowledge about energy issues in the United States and a panel that's equally well-equipped to talk about some of the issues that we face. Our format for today is pretty straightforward. What we're going to do first is hear from Commissioner Spitzer for about 20 minutes. We're then going to hear reactions to his talk from each of our panel members who I'll introduce after Commissioner Spitzer's remarks. And we're then going to proceed with a panel discussion. I've got a few questions to sort of start things going, but then what we really hope to do is hear questions from all of you and have a lively discussion of the issues we're talking about today. So without further due, let me introduce Commissioner Spitzer to you. Mark Spitzer is originally from Pennsylvania. He is, we're proud to say, a distinguished alumnus of the University of Michigan Law School. His background as a practicing attorney is in tax law. I'm not actually sure, maybe he'll tell us what the segue is from tax law to energy regulation. But it's a transition that he made with a stop along the way in the Arizona State Senate where he eventually became the majority leader of the state Senate. After his tenure in elective office, he moved to another elected position as the head of the Arizona Corporation Commission where he led efforts in the state of Arizona to develop a renewable energy portfolio, making Arizona one of the first states in the United States to do so in 2000. He was nominated two years ago by President Bush to be a commissioner on the Federal Energy Regulatory Commission. In his short tenure at the FERC, he has pushed to consider energy sources, fuel sources in energy production and development to move away from what some might call a former agnostic approach to the fuel sources for energy. Mark is a very thoughtful and dedicated public servant with a commitment to addressing the problem of global climate change. Please join me in welcoming Commissioner Mark Spitzer. Thank you very much. It's a great pleasure to be back in Ann Arbor. It's been a long, long time and somewhat intimidating to be in this facility. I know most of you are here to see Mr. Gramlich and not me. I'm mindful of that. Sometimes a little bit of humility is a good thing for a recovering politician. And you know, I don't apologize for considering myself a politician. I think it's a good thing. Being in this building and seeing the pictures reminded me of really the first time we went into the district at any given point in time when we had moved from Arizona where I'd been in Arizona for 25 years right after graduating from law school here and moved my family. And President Ford passed away and I took my son down to the cortege and to the funeral. And people say a lot of things about Washington, D.C. And there's the town is criticized. And many of these criticisms are valid. But there's a great sense of history in that city. And the streets were lined with Republicans and Democrats and liberals and conservatives. Because there was a respect for the political process that underlies this country. Now we have a huge amount of challenges in the area of energy. Those are daunting challenges. I'm going to recite a few of them and propose some solutions to those challenges. And it's easy to throw your hands up and bemoan our fate and declare defeat. I'm an optimist by nature. And we have a political system with a lot of warts. And I'm somebody who had a knock on doors and gather petition signatures and ran in seven elections. So I'm some of the warts are visible on me. But I'm as those people from the District of Columbia who came to pay final respects to President Ford. I respect the political process and I'm optimistic enough to believe that you all coming here taking time out of your day to attend this event in support of a cause greater than ourselves suggests that that little P political process will bear some fruit. The challenges are great. I believe in competition. I believe that competition is inherently an American concept and that we do not like monopoly. And one of the benefits of being that small number of elected state commissioners is I campaigned on a platform of competition. But competitions under attack. I think in Michigan and frankly throughout the country. And I will recount a little bit of the history of how we ended up where we are with FERC authority over competitive wholesale markets. And I believe competitive wholesale markets are the law of the United States. There's been a pipe bipartisan agreement on competition in energy. And I believe that should continue. But it can only continue if we are cooperative with our state colleagues. And that's another area of what is in the past been a very unhealthy relationship between the federal government and the state government. And it's my hope that we have a healthy tension where both the states and the federal government assert their rights and responsibilities but are respectful of others. Let's you know I used to give speeches and I talk about getting on top of the world. And the only way you can you can sometimes in a very complex area of the law. I talk about this in largely a taxation but later when I got into politics in political terms I go around the country. You got to get on top of the world and people come down and say you must have gone to Michigan law school. You had professor L. Hart right for tax. Which I did. I was not an A student. But I L. Hart was a fabulous and he had a way of encapsulating very complicated difficult concepts and making them understandable so that people could deal with a court the internal revenue code L. Hart used to say most complicated statute ever enacted by mankind. And make it somehow comprehensible and and he had the most loyal cadre of students most of whom hated tax. Anybody remember how hard right anybody in the room. So I'm going to get on top of the world. Here are the challenges skyrocketing commodity prices. Okay in the 1990s oil was $10 a barrel natural gas traded between $2 and $3 per million British thermal units. Now what's happened. There was an explosion of demand in developing world particularly India and China. We had declining production in United States gas fields. We have declining production in Canadian gas fields. So the so-called gas bubble of the 1990s has been burst and gas prices reached $15 per million British thermal units after hurricanes Rita and Katrina. And energy prices translated into retail rate increases across the country. And I was a retail regulator in Arizona and I had to deal with rate cases. And it was very very difficult when at a public hearing a lady would stand up with her at social security check and say my entire check is going to pay my energy bill. It's hard-rending. And yet under the Arizona Constitution of laws I was required correctly to assure the utilities providing services to customers and adequate rate on return. But nevertheless this was this was a problem. Regulatory uncertainty. We have now a conundrum in the United States on construction of base low generation. It is my personal view. And I want to be careful that I am speaking only for myself and not for my colleagues. And I'm certainly not speaking for the United States government. And it's questionable whether the members of Congress are in fact even interested in my opinions in any event. But that be that as it may. I convinced that the science of global warming is real. I was convinced of this in year 2000 when Arizona adopted one of the first renewable portfolio standards in the nation. We had a Republican actually a Republican commission approve this. I have to say that at the Republican headquarters after I crammed this through the switchboard blew out from all the angry constituents. But we what the benefit of adopting the RPS at the state level. And I know there's a lot of discussion about federal RPS was I was able in conducting 15 hearings in all counties of Arizona plus an additional 10 hearings in Maricopa and Pima counties to explain to the people of Arizona why we felt that the science of climate change dictated that the Arizona Commission mandate upon its utilities a renewable standard. We explained the objective and purpose of the rule and the mandate. We explained the funding mechanism. And we explained to the ratepayers how much it was going to cost. And we asked up front in the process for their buy-in. And we received it. But it is essential that policymakers show leadership. And leadership is in the form of communication to the constituents. The nature of the problem. The scope of the solution and the cost. So the RPS proved fortuitous. But nevertheless utilities in Arizona throughout the country are puzzled by creation of new baseload generation. Nuclear energy is a long ways off even if we can deal with the Yucca Mountain storage issue. So called clean coal which is the moniker is IGCC which is the chemical treatment by which coal instead of being burnt pulverized coal being burned coal is chemically treated and the heat generated therein runs it spins a turbine that produces electricity. The question with with this form of coal is what is done with the carbon dioxide and the science of sequestration I think is clear. But the science of injection and storage and ensuring that the carbon dioxide not leak out into the atmosphere is seriously debated and questioned. No state regulator is going to subject his or her captive rate payers to the economic risk of an uncertain technology. That's true of nuclear. That's true of IGCC with carbon sequestration. That's certainly true of pulverized coal. So where does that leave us? It leaves us with natural gas. And remember natural gas prices hit $15 per MMBTU. And so we put all our eggs in the natural gas basket and that is that is that poses a in my view a serious problem for the reliability of the grid and it poses a serious problem in terms of volatility of prices because gas is one of the most volatile of our commodities. So we don't know what base low generation we're going to build. The next issue is one that I know I've limited time but I want to spend a little bit of time talking about the NIMBY issue. When I came to FERC I said I'm going to work on three issues markets rule of law which is the Enron issue and the public had lost faith and confidence in our system of energy and I wanted to do something to restore that and the issue of infrastructure. You cannot have reliable electric supplies delivered to your home without infrastructure. You cannot have renewable energy produced in areas that are frequently distant from load pockets and have it delivered to our homes without infrastructure. Yet it is increasingly difficult almost impossible in some parts of the country to cite energy infrastructure. Now it's a good news bad news thing and I'm the type of guy. You all have gotten this idea of when I get lemons I like to turn them into lemonade. Let me talk a little bit about this NIMBYism phenomenon. Not in my backyard is distinguished in my judgment from legitimate environmental concerns. I want one of the reasons I have this predilection for renewables and was so strident in my support of renewable portfolio standard in Arizona in 2001 was I was first the father of a Asmatic child who spent some time in emergency rooms on bad carbon monoxide days in Phoenix. And then I had the opportunity to draft and then draft the Arizona Clean Air Act in 1997 and then get that act basically as accepted by the federal EPA. Region 9 Administrator in San Francisco as solving Arizona's air quality problem and then was pleased to see after I left the legislature that Arizona was no longer an attainment area for the pollutants that we helped defeat. So I'm extremely interested in what I consider to be legitimate environmental issues. When I receive phone calls from constituents opposing renewable resources because it's in their backyard and it disturbs their chi. That's what she disturbed her chi. I and I know the very real and serious environmental consequences of our failure to act in support of renewable energy. I tend to lose patience perhaps to a fault with the Nibbism. But there is a clear dichotomy between Nibbism and legitimate environmental considerations. Let me be very clear. The federal government has an absolute mandate and working with our state colleagues to protect the health welfare and safety of the people of this country. Utility projects that are inconsistent with our environmental interests should not be built. Period. However, Nibbism concerns are not necessarily coterminous with legitimate environmental interests and frequently they are not. For example, it is easy to find opposition to high voltage paralyze because they disturb people's property values. There was a myth that the Sierra Club and the Liberals caused the lack of transmission in California. I'm not I was rarely endorsed by the Sierra Club. But the fact is it was not the Sierra Club that caused transmission constraints in the state of California. It tended to be wealthy Republican real estate investors who were interested in their economic interests and the negative impact upon high voltage transmission upon their economic interests rather than the public good. And unfortunately, government in California did not sufficiently stand up for the public interest versus the private interest of the landowners who by the way under the law of eminent domain received compensation under both the Constitution of the United States and the of every state union for the economic harm attendant to the construction of the power lines. It used to be, Nimbism was the domain of the very affluent. There were a few areas in town where you could not build anything deemed odious. These are the places where there's one little place in Paradise Valley, Arizona where I was familiar with. Where the zoning lobbyists would show up in Mercedes and the pissed off home owners would appear in Bentley's. Guess what? That project will not get cited. So Nimbism tended to cause projects that the wealthy people would not accept to be cited on the wrong side of the tracks. That's called environmental racism. And I had a member of my Senate, a Democrat in 1993 come to me with charts and graphs and data to me clearly demonstrating the existence of environmental racism both in my state of Arizona and throughout the country. And environmental racism is not acceptable. Now the good news. Good news is that nobody wants anything anywhere now. And that Nimbism has become omnipresent. Even lower middle class people have become Nimbis. I can tell you some stories of citing cases. I had a, as an elected official in Arizona, I had to cite power plants and transmission lines in people's backyards, thereby pissing them off. And then the next day I had asked for their votes. That is a challenge to an elected official. And I had to be sometimes full of guile, sometimes courage in order to achieve what we needed to achieve in terms of providing reliable utility services and reasonable prices to my constituents. But environmental justice is not about putting someone, putting infrastructure where people are not politically able to defend themselves after all other sites have been excluded by the people who are politically well connected. But the internet has made everybody politically well connected. So now government has the opportunity and in my view the obligation to cite energy infrastructure where it should be cited based on science and the law as opposed to citing it where it is politically expedient after all other options have been rejected. Now how does government assert this moral authority? Government can do that in a number of ways. Government can promote competitive markets. I said I'm a believer in competition. And I talked about the rule of law where there are a number of cases on the concept of sanctity of contract. There's a Supreme Court, the series of Supreme Court decisions crystallize in the concept of Mobile Sierra Doctor. And I saw this in Arizona and I see it in my current federal position. That until and unless government is willing to enforce the reasonable expectations of the parties to a bilateral contract in energy we cannot succeed in building infrastructure nor can we succeed in creating wholesale markets. So we have a three-legged stool. Infrastructure markets rule of law. Not any one of the legs out and you encounter problems. So I'm very committed to this three-legged stool. The issue of competition, the issue of encouraging new entrants into the energy market including but not limited to renewables. And I won't limited to renewables because competition is a riding tide that lifts all boats. Competition means that a new combined cycle plant can replace a dirty old coal plant inside a load pocket if the markets function properly and if government is willing to stand up for competitive markets even when there are political challenges. Now there have been political challenges. There are states in the union where I'll now single out Illinois and Maryland where the state legislature as part of retail restructuring imposed 10-year rate caps. So we had 10 years of pen up increases in energy commodities that ultimately have passed through to retail bills. And when the rate caps expired like the soda that explodes after being shaken caused political turmoil and caused political leadership instead of questioning the wisdom of those legislators enacting 10-year rate caps to disconnect price signals from the cost of the commodity and the cost of energy they decided to scapegoat or demonize the energy producers. I think it's it's just about always bad just about always bad to create a scapegoat politically particularly for political purposes. And so that was that was very disturbing to me. And these the scenario in these jurisdictions has not yet been played out. But it's my it's my hope that we will stick with competition because competition has given us in my view many benefits. First Congress deregulated the price of well-held gas in 1982 and natural gas customers greatly benefited. That was the the idyllic circumstance of the 1990s with low gas prices was attributable directly to the deregulation of natural gas. Enron kind of a deregulation of four-letter word. And so I'm told by the people of FERC by the people in the press office don't use the word deregulation use the word restructuring. Okay well in power material as we lawyer say. But the the the the history of competitive wholesale markets has been one of advancing environmental interests and one of advancing rate fair interest. The first chink in the armor of the vertical integrative monopoly was the enactment of PERPA which is a federal statute that created the qualifying facilities which were by and large cogeneration or clean technologies. So the utility industry was forced to kicking screaming over their objection to purchase renewables starting in 78. And then Congress enacted in 1992 the Energy Policy Act where wholesale competition between the law of the United States. This was a Democratic Congress and a Republican president. Successive Congresses both Republican and Democrat and successive administrations both Republican Democrat have achieved a bipartisan consensus. You don't hear that in my town my new town very often in favor of competition. FERC issued order 888 in 1996. Rob wrote it single handedly right. Okay. That legally prescribed a transmission owner from discriminating in favor of his or its own generation as opposed to competitive generation. And so and FERC has continuously worked on various iterations and I've had a very small role to play in some of these to refine open access. But the purpose is not competition. Let's go back to El Harderite and getting on top of the world. The purpose of competition is not for competition per se. Competition must serve a larger purpose. The larger purpose the competition serves in my judgment is providing environmentally friendly energy at reasonable prices. Now I talked about moral authority to do citing. Here's how state and federal governments can work together to do moral authority to cite infrastructure in people's backyards. The National Resources Defense Council there's a guy named Ralph Kavanaugh. He is a good speaker. I'm a lousy speaker. Ralph Kavanaugh is fabulous. And he is arguing with every breath in favor of decoupling utility revenues. From commodity prices. And in this era of challenges that I described in terms of skyrocketing commodity prices increase global or decreased increased global demand and decreased US supply as well as increased US demand. I mean these plasma TVs consume 20 times the energy of a regular TV. Population growth may be stagnant but demand is is going up even in the state of Michigan. Attendant to the consumer demand. You wouldn't guess. You'd be surprised. And the increased gadgetry of our country has led to this great demand. But Ralph Kavanaugh is saying we can't with all these challenges sell electricity the way we sell Kansas soup. We need to change the rules. And we need to give the utilities. This is a non-utility guy. He's seen the light. He said we give the utilities a return on equity to invest in a coal plant. How does that make sense when we penalize them for adopting energy efficiency. We need to give the utilities a return on investment for energy efficiency. We need to give the utilities a return on investment for renewable resources. We need to give utilities return on investment for demand response. We need to adopt programs that make retail rate design consistent with the public interest instead of inconsistent with the public interest. That's what government can do. The Congress can enact cap and trade program to reduce greenhouse gas emissions. And Congress can adopt laws. I'm not going to tell them how. That fully price in the cost of a pulverized coal plant. Economic externality sounds too. That's not you know I'm not a Michigan. That's not a hard right is they need to pay for their pollution. And that has to take an act to Congress. I'm a believer in states' rights and I'd like to see the states adopt RPS standards consistent with their own interests. Arizona has a very strong solar bias. Can't imagine why. There's a bipartisan consensus in Arizona government in favor of solar energy. And that preference ought to be respected. In state law. And that expectation. And expression of interest in state law ought to be respected by the federal government. That's part of the respect. That I discussed earlier. So if government. Adops retail rate restructuring. If government implements energy efficiency programs. If government. Enacts cap and trade legislation. To make carbon pay for its costs. If government enacts renewable renewable portfolio standards. Then I think government has the moral authority. To cite transmission lines. Where people don't want them. And say you have done what you need to do. Because we have done our job. We have done our job. Now it's your time to do yours. And we have to be creative and we have to we have to be a little messianic I think. In terms of how we articulate these issues. Siting infrastructure is not easy. Just as I'm sure it's it's a very difficult task to to enact greenhouse gas legislation. But we need we need to do both. We need to address the supply side of the equation. We need to address the demand side of the equation. I get a little tired. Of people in my party. Talking about increasing supply IE drilling. And refusing to consider questions of demand and refusing to consider fuel sources. I grow a little weary of my friends across the aisle. Correctly asserting the need for renewable resources. And climate change. We're refusing to acknowledge the significance of energy efficiency. Or excuse me energy infrastructure. And refusing to acknowledge the very real concerns. Of reliable supply. Of energy. We need to do both. But the public has. Particularly in the West where where I'm from. With the umbrella low in California that consumed the entire entire Western United States. The public had lost faith and confidence. In government. And had frankly lost faith and confidence in. The those who were providing energy. And that confidence needs to be regained. Because when I was raising rates on retail rate payers. I had to go and look the lady in the eye. Was holding up her social security check. And say I have done absolutely everything I can. To review this utilities application. To make sure that your rates as low as possible. Still consistent with giving the utility. Providing that heat to you. A fair rate of return. And I would hope that the people in Washington D.C. Are doing all they can. To ensure that. The energy markets. Are competitive. Are transparent. And are fair. And are not being manipulated. I needed to ask my colleagues in Washington to do that for me. And I would hope that I'm I'm fulfilling their objective. You know there was one there are a couple of interesting line sighting cases. I had. I had a group of. Folks who. Viemently objected to the sighting. Of a facility in a very constrained area. And I was getting all these emails saying you got to put it somewhere else. This is a Republican neighborhood. You can't put the line here. You can't use the unacceptable. We're too good for this. So I actually. Irritated my colleagues we had a hearing. In their little community. And I used. A concept. I guess I dusted off one of my old books. Rousseau had the social compact. About the obligations that we owe. To each other. And I recognize and I'm. You know I'm not a funky Republican. I believe in. Property rights and I respect them. There's a lot of libertarian blood in me. There's a populist. You can't be a regulator without some populist blood coursing through your veins. But the con concept of Rousseau social compact was I think very relevant. And there's also a doctrine that I don't know if he overtly. Addressed it. In his works. But the concept of no bad no bless oblige. Which means no ability obligates. So I said you in here are very rich successful people. So I don't think you can say you don't want this facility. In fact I think you need to take the facility and like it. Because you have a higher obligation. That everybody else. No ability obligates. And we went I went through I do what my I don't do PowerPoint but I did this time. And explain the consequences of the failure to cite the project. I understood. The distress of those who were vehemently opposed. I understood you know I got the emails will turn you out of office and will vote you out of all I express. I said Mrs. Spitzer is in fact very sympathetic with your. With those views. But when the day was done. They accepted the line. And a couple who came up to me afterwards and said. You know I really think it's ugly. But all things considered it just it just wasn't right. It wouldn't be right. For you to vote it down. So it's pissed off as I am and several neighbors are. And as unhappy we are. Number one we got a fair hearing. Number two you explain what you're doing. And I guess it has to be built. That line I don't and the others that we successfully constructed as well as the power plants most of them. Clean burning natural gas plants that enable us to mothball. The plants burning coal. And fuel oil in the city of Phoenix that we're producing. The air quality problems that we're able to get rid of. In fact. We're as pro environment projects as you could find. But we only had the moral authority to impose those projects upon the people of the state of Arizona. Having done everything we could do. To advance environmental interests. As a state such as RPS. So I would suggest. Certainly not dictate to the people of the state of Michigan but suggest to their elected officials. That if they embark upon. Efforts. To reduce demand. To to incent energy efficiency. And to assert renewable technology. They will find many benefits. That I think are the this is one where. The the the sum of the parts is not nearly equal to the whole. If you take a holistic approach to energy. I don't think you could do it any other way. The challenges are too great. To do it any other way. I'm very pleased to be here. I know I know you we have we have a panel and we want to take some questions and I. I very much. Look forward to those. But. You know. Going back to. That for Jerry Ford funeral. The most important. Thing we can do. Is there's been a distressing. Lack or absence of civility. In our political discourse. And I don't know if it's. I can't talk radio is unbearable. So maybe you all know. More than I do. Particularly some of my. Colleagues on my side of the aisle. And I guess the Internet does there's some self selection. Where people. Go to various extremes. In the context of their political discourse. The only way we're going to solve the problem which is very real. Of providing reliable energy sources and prices people can afford. That don't damage the earth. Is to find a common ground. It's going to require people to stop stop talking past each other. And start communicating among each other. And most of all it's going to require that all of us respect. As much as we are irritated by the political process. Be respectful of that process. And recognize that it may not always comport with our immediate desires. But in the long run. It's the only solution that we will have to solve these challenges. And I thank you very much for your attention. Thank you mark. While our panelists. Join mark up at the. At the front of the room I'm going to just give quick introduction so we can get right to their remarks. And start having the the exchange that that mark described which certainly agree is important to our being able to tackle the the challenges that we face. To mark the immediate left is Rob Gramlich. Rob as Dean Collins mentioned is the policy director of the American Wind Energy Association. Suspect that the American Wind Energy Association is not a household name. For everybody in the room but you might be surprised to know that it's a national trade association of over twelve hundred companies. Involved in wind production in the United States. Rob as as mark indicated in his remarks previously served at the Federal Energy Regulatory Commission. Two tours of duty there. As an economic advisor for nineteen ninety five to nineteen ninety nine and again from two thousand and one to two thousand and five. Rob has a bachelor's degree from Colby College in the great state of Maine favorite place of mine. And a master's in public policy from Berkeley and known. To to many of you in this room. The son of son of our beloved former provost Ed Gramlich. And a long time Ann Arbor resident welcome back to Ann Arbor Rob. To Rob's immediate left. Is a Meredith Fowley a Meredith is an assistant professor here at the Ford school. And also in the economics department. At L. S. and A. her research interests include markets market based environmental regulation. Electricity markets and technology adoption. As well as climate change. Mitigation she has her undergraduate and master's degrees from Cornell University. And a PhD from University California at Berkeley. And welcome to Meredith. And last but certainly not least at the far end of the panel is Barry Ray. Who needs no introduction to many people here. Barry is jointly appointed as a professor at the Ford school and at the school of natural resources. And environment. He's also a senior fellow at the Brookings Institute in Washington. And will be a visiting professor next year at the University of Virginia. Where he's convening a national conference on climate change policy in December 2008. Just after the presidential election. Barry's worked on a wide range of environmental policy issues during the course of his career. But most recently he's been focusing on climate change and in particular something that Mark talked about which is the relationship between federal and state efforts to address climate change issues. Barry is a bachelor's degree from Carthage College and a master's and PhD from the University of Chicago. And welcome to Barry. So what we're going to do is just have just very brief reactions from each of our panelists to Mark's remarks. We'll just go right down the aisle in the order that I introduced everybody. And then I've got some questions and I suspect you do as well. So let's go ahead first with Rob. Okay. Thanks Dave. What Dave didn't mention is actually my career started as a babysitter for the economics department here. I see the lambs back there and it's good to be back home. Thanks for having this forum here. It's a very important issue. Climate change is really that as my father said actually the dominant issue going forward in terms of how we're going to solve it. It's really not clear exactly how we're going to get there. I think this year is very important. It's a turning point year not just for these elections that will finally put a president in the White House that agrees with the science and is ready to do something. But this actually marks for me personally one generation of recognition of climate change. I was at Burns Park School up the road here where my sixth grade teacher told us all about global warming. And now my daughter is in sixth grade and we've been through a whole generation to a lot of people it still seems like oh wow I didn't realize that was happening. But come on guys it's been a whole generation now. Let's get moving. I'm glad to see this was partly my idea Mark Spitzer should be a very well known Michigan alum and given his trajectory I'm glad to see Michigan bring him here and embracing him. I watch him at the federal level and he's a leader at FERC and was it in Arizona and my bosses at FERC were proud to bring him on to FERC so I'm glad you've done this. Just on his remarks the wind industry is growing very strongly Michigan is a great state a renewable electricity standard here would be fantastic so I thank Commissioner Spitzer for those remarks. The three pillars competition infrastructure and rule of law are absolutely essential. We spend a lot of time dealing with infrastructure. I think a lot of people don't realize that wind really requires transmission infrastructure. We have great wind resource in this country. It's largely distant from load in the Michigan context. There's great wind resource in the thumb and the users of electricity are in the southeast here and so you need transmission to connect the two. Nationally we have great wind resource in the middle of the country through the Dakotas down through Texas. We could have transmission super highways which you know these highways would be here forever the wind resource will be there forever it's a great investment for the nation so the infrastructure requirements really are significant but on the other hand there would be fantastic investments so I totally agree with his approach on those. I would just feel like I'm supposed to disagree with one thing that the speaker said as a commenter. So I will say that in the climate policy debate as to whether climate policy a carbon cap and trade policy sort of subsumes renewable portfolio standards and whether the renewable portfolio standards or what we're calling our renewable electricity standards should be really done just at the state level. I would say it's great to have state level renewable electricity standards and the states can design them how they want and they should be grandfathered in and they should be able to go as high as they want but it would be very important to have the national renewable electricity standard as well in part because the carbon cap and trade policies that are being debated in Washington are very minimal and you're not going to see much of a price effect for 10, 15 years. So we don't want to as an industry I think efficiency is the same way but efficiency and some of the deployable renewables don't want to go through a valley of death for 10 years and then resurge again. And in fact I think policy purists may say and certainly thinking about what most environmental economists or Ford school folks might say that a carbon cap and trade or tax or really a tax would be the purest policy. Nothing's pure in Washington and what's happening with the carbon bills in Washington is the permits are actually going to the coal plants and they actually have even a new entry provision for who gets the valuable carbon permits and renewables are actually specifically excluded from that. So it's a very nasty debate in Washington and it ain't going to be anything close to pure. So a renewable electricity standard which actually is something that a lot of people like whereas a tax or a permit system are viewed as sort of penalties, a lot of people like renewable electricity standards and would be proud to vote for them. So if we can get more done and actually display emissions that way, that should be part of the program. Great. OK. So I just wanted to start by saying I really appreciate being part of this panel thanks to Commissioner Spitzer for taking the time to talk with us today about these really important issues and thanks, of course, to Rob Gramlich for initiating this panel. So I had a couple of points that I wanted to pick up on some of the comments you made. I think in addition to having almost a generation now of climate change experience with and awareness of, we now have almost probably over 10 years of experience with trying to introduce competition into wholesale electricity markets. In the late 1990s we had almost half the states passed restructuring legislation. And we have now had several years to try and figure out how to make this work. And it turns out that electricity is a really tricky commodity. You have to balance supply and demand in real time, can't store it, or at least it's prohibitively costly to store. And the demand side doesn't pay attention really. And so it's hard to define, to design a really efficient market for wholesale electricity sales. Now we've made a lot of progress, certainly with FERC's help. And we're figuring out how to do that. And basically to create a market that actually works, you have to introduce additional incentives, additional institutions to solve problems such as these restructured markets haven't been providing sufficient incentive for a new investment in transmission or in new capacity. So we see things like capacity markets and financial transmissions rights being introduced. And so here's the interesting tension that I would love to hear more, speak about maybe briefly. FERC has been really involved in trying to resolve some of the tensions between solving problems in restructured markets and also clearing a path or encouraging renewable energy resources. So with the capacity markets example, we're trying to offer side payments to get folks to invest in generation and provide adequate resources for future demand. But in setting up those markets, some would argue that they discriminate against or at least don't encourage to the extent that we might want investment in renewables. So you see these interesting tensions between protecting or fostering competition in the wholesale electricity markets and the need to encourage renewables. FERC's been really instrumental in trying to sort out some of these issues. There was a recent ruling in California that recognized that intermittent resources renewables deserve special treatment in trying to set up these institutions and market signals. And we'd just love to hear your insights and some of the challenges you see that lie ahead in terms of trying to simultaneously encourage competition and also encourage renewables. And finally, one point to pick up on what Rob Graham, like said, and this trade-offs between having state-level RPSs and federal, I think there's certainly something to be said for state-level RPSs. As you mentioned, there's heterogeneity in political support for renewables across states. And you want to honor that and encourage that. On the other hand, there's also something to be said for a federal RPS. And in terms of efficient deployment of renewable resources, that's going to require a lot of infrastructure and a lot of coordination across states. And so there are these trade-offs. And again, I'd like to hear some of your comments or just be really interested in what you'd have to say about the trade-offs between a federal RPS that has uniform incentives across the country and these state-level RPSs that honor diversity across states in terms of preferences and political support for renewables. Thanks. Like Meredith, I'd like to welcome Commissioner Spitzer and Rob. Very, very good to have you with us. And it's an honor to be on this panel. I wanted to pick up on a few points dealing with what I'll call energy governance issues, which you certainly addressed. One question simply involves the structure of governmental institutions as we move into the next era of energy policy. It's interesting to look back. This is not a new issue. But if one thinks of the evolution of state public utility commissions or service commissions, one of which you served over a long, long period of time, the creation of FERC and the Department of Energy at the federal level in 1977, kind of built piece by piece, a set of institutions to deal with different aspects of energy. But now we look at the question of how to think about climate and carbon. And I tend to think one of the most interesting things happening at the state level is not necessarily the number of states enacting renewable portfolio standards, although it is 25 and growing, or the number of states enacting cap and trade or cap and trade equivalent bills, although it's 14 or 15 and growing. But how states are beginning to ask how do we put these various institutional pieces together in a coherent way? How do we get the energy folks in state government and all of their constituents talking to the environment folks and all of their constituents, as opposed to the existing kind of fragmentation, which is problematic under any circumstances, but especially in a case like carbon? It strikes me, commissioner, that in all likelihood, the next president of the United States will sign into law a carbon cap and trade bill while your term in office continues. And my guess would be, if you look at Lieberman Warner or any of those bills, those are dauntingly complex bills from an administrative standpoint. It is not simply handing off to EPA and allowing a market based bill to self implement. It talks about collaboration between EPA and the Department of Energy, the Department of Interior, and the Department of Agriculture. My guess is FERC's going to play a role in some piece or aspect of that, and pretty much you run the entire alphabet soup of the federal government. One of those complex challenges government has ever undertaken. And so I'm curious your thoughts about the suitability of the existing structure of federal institutions, particularly in light of the fact that former energy secretary and New Mexico governor Richardson talked a couple of weeks ago about the idea of creating a climate czar to integrate across programs. And that was an idea first developed by Gerald Ford and implemented in the Ford administration in 1975 and 76 in the run-up to creation of the energy department in FERC under President Carter, something that was discussed by Arnold Schwarzenegger ironically in 2005. Before he got so much resistance, he then began to patch things together on an agency-by-agency basis. So I'd be very curious your thoughts about the governmental structure and challenges facing energy. And for that matter, the suitability of FERC and its other institutions at the federal level. I'm also curious your thoughts about the role of commission models, both in a broad sense but in a more immediate one. We're clearly seeing in the current situation with the Environmental Protection Agency tremendous difficulties of implementing that model where you have an administrator with a direct reporting line to the president and direct political control over the agency making a very difficult decision, namely the rejection of the waiver of the proposal from California and a number of other states. Arguments of political favoritism and political influence. It strikes me that at FERC, you're in a very different context because at least the commission model, whether it's the FTC or its equivalence, is designed to create a kind of bipartisanship, much like you talked about in your remarks, that to some extent removes direct presidential or executive authority over decision making. And I'm curious your thoughts about the adaptability of that model and other contexts, particularly having served on a state commission, which I believe was an elected basis in Arizona before you moved into the legislature. So how we structure these in the political incentives that emerge is a very significant one. Last point I want to touch upon, you talked extensively and my colleagues have talked about the state's issues. It's striking to me that on the one hand, we live in a nation where about half the states have pretty aggressive energy policies and programs. And I'm really beginning to think about the infrastructure of different organizations, institutions, and policies. Those folks, and I talked to them quite a bit, would argue they're five, 10 years ahead of the federal government in thinking about these issues and they're very concerned about preemption kinds of concerns in many respects. But there's another set of states, maybe 20, maybe 25, that haven't thought much about renewable energy. Aren't anywhere close to passing a renewable portfolio standard? Haven't really developed the kind of internal capacity of an Arizona or California or a New York. And it strikes me that one of the great challenges facing federal institutions, although this may not purely be in FERC's jurisdiction, is how do you deal with a nation that is so divided intergovernmentally where literally half the states have massive, massive commitments to a policy arena where as in a large number of others, states have only begun to think about some of these kinds of issues. Is that a role for federal leadership? How do you reconcile differences between leaders versus laggers and weigh some of these shifts in transitions and kinds of concerns? I would pull all of that together under the rubric of energy governance and how you see the next 10 or 15 years moving forward. Thank you. Corey, I don't want you to do much here because we have enough questions just from our panelists. But just to sort of focus things a little bit, why don't we start where Mary ended? We'll give you a chance to respond to her. Why don't we start with the state's issue? I mean, climate change is one of these rare issues where our federal state model doesn't work perfectly because we all, you know, our collective fates rise and fall on what we all do. So we can have the best possible climate change policy and the best possible renewable energy policy here in Michigan and it doesn't get us very far. You know, and in half the rest of the states doesn't get us very far if the rest of the country offsets our gains by doing nothing. So how do we, you know, how do we in a meaningful way ensure that everybody gets into the renewable energy game in the ways that you have advocated? If we don't have some kind of federal government involved, we don't at least have some kind of federal floor. States can go higher. States can do more, as Barry suggested. Many already have. But why don't we at least want to have some sort of federal floor so we at least get the rest of the states into the game that aren't right now doing very much? Well, complicated issue. Let me try and segment a few things and then maybe suggest some areas that haven't been broached where there is more harmony as opposed to the tension that I talked about. I am reluctant to assume my state colleagues won't do their job. Now I recognize this issue of leaders and laggards is of concern. Certainly in the area of greenhouse gas, carbon and electricity, cap and trade, tax, the analogy is to the Clean Air Act of 1992. And there's interstate commerce and there's no question there's federal authority. Sometimes though, you have to follow the Hippocratic Oath and at least do no harm. And in 2003, this is why I was in Arizona FERC proposed a standard market design for locational marginal pricing. I grossly simplified for the entire United States and there was a whirlwind in the West. I ended up on a lot of debating panelists not because I was informed or intelligent or articulate but because I was the only one in the West who would support SMD. All the rest of the Western commissioners, Republican, Democrat, Liberal, Conservative were in opposition. And in fact, I think it was certainly well intentioned but politically caused a backlash that actually retarded the growth of the Southwestern Regional Transmission Organization and gave the opponents of markets the pretext to defeat the proposal of an issue. And so even well intentioned federal efforts that flatly contradict expressed views of the states are doomed to failure and unfortunately may be counterproductive. Now, there's the traditional and it's embodying the Federal Power Act, federal primacy over wholesale power markets, state authority over retail. Now, there's a conundrum. We haven't I talked about Illinois and Maryland probably of greater concern is what happened in Virginia where they not only returned to re-regulation but they set the return on equity at 200 basis points above the average cost of installed capacity. So the Virginia Commission doesn't have a heck of a lot to do. The incumbent is going to build the power plants, coal arguably, and they're automatically put into rate base and it's contrary to where the FERC would like to go in terms of creating wholesale markets. And in my view, not good policy. But sometimes in government we have to, I talked about the civility of the discourse and there sometimes when we just have to accept results that we might not urge. And look instead for areas where we can make a positive difference. Let me cite two areas. There is in resource adequacy an intersection of a role between the federal government and the state government. I have convened a competitive procurement task force with my state colleagues at Naverook. And we have, through a grant from the Department of Energy, are in the midst of preparing a best practices for RFPs. We did an RFP for competitive power in Arizona and we felt like we were starting from scratch. We were creating a rulemaking in the guise of a proceeding frankly that was very difficult for our staff to manage. And we have a fairly decent sized staff. But you can imagine the small states and the small commissions being totally unable to oversee or administer or implement an RFP program for baseload generation or renewable generation. And what we're proposing to do is find some consensus between state commissioners that have very different views, frankly. North Carolina has vertically integrated. And they have historically been resentful of dictates from the restructured states. But we've got state commissioners and myself reflecting all points of view trying to come up with best practices. Because collectively we recognize that whether you're in the vertically integrated state like North Carolina, they defeated coal plants in Charlotte. They have a major problem procuring adequate resources that their constituents will accept. And their constituents, good old boy Republicans in Charlotte said no to coal. I think that's a good thing. It shows the consensus on the climate issue. It poses a challenge that can only be addressed through the type of competitive procurement that we're trying to articulate. Commissioner Wellinghoff, my colleague at FERC from the great state of Nevada, has a demand response task force. Demand response has been very successful in organized markets where price signals are sent. And one of the great untold stories of recent time is the great success of demand response in the New England capacity market. And you asked a question about capacity markets. And let me just digress for a moment. There's a challenge here because I'm a FERC commissioner. I'm not a dictator. And we have cases. And I'm still a lawyer. My default isn't really as a politician. My default is a lawyer. And we had a case in controversy. And there was extremely contentious negotiations in the New England, how they were going to structure their procurement. And we had a wonderful FERC administrative law judge who has since been elevated or demoted, depending on your view, to the Maryland Public Service Commission. So we lost him. But he got a settlement where I think 104 out of 111 parties agreed to the settlement that resulted in the New England. You couldn't get 104 New Englanders to agree the sunrises in the east. So he did a terrific job. And the case was resolved. Now, I might have chosen some different terms in that settlement agreement. I've written it from scratch. But I didn't. And you know what? I should. I should be respectful of the stakeholders. And 111 or 114 or however many participated and those who agreed to the settlement. And it clearly produced just and reasonable results for energy prices, which is our mandate under the Federal Power Act. And I think it was appropriate for us to decide the case in that manner. And what was very pleasing to me is that instead of building new power plants in New England, people are reducing their peak demand. Let me briefly explain load factor. We've had a real challenge with declining load factor. A load factor is a fraction the denominator of which is peak demand and the numerator of which is average demand. The higher the load factor, the more efficient the system. The lower the load factor, the less efficient the system. People are apparently building big houses with lots of air conditioning in northern Maine that's driving New England load factors down. And so the rate pairs and the environment are bearing the burden of a very expensive system when the average demand is much less. Demand response is the best technique that we have that reduces, that increases load factors and increases the efficiency of the system. Demand response was the biggest participant in the most recent New England auction. And do you know what the greenhouse gas emissions and demand response is? Zero. So I think that's a great result for the rate pairs of New England and ultimately for the rate pairs of the United States. And Commissioner Wellinghoff has a joint federal state task force as do I at NARUK coordinating efforts for states to better implement demand response. And this has typically been seen as a purely state issue and that, you know, is FERC trespassing on this issue? Just like my competitive procurement, this is a resource is traditionally been a jealously guarded state prerogative and it used to be none of your business. What I find interesting is the states are now willing to work with us. They don't consider the FERC, I would hope, a threat to state sovereignty or state independence, but they view us as a partner in providing reliable network with minimal environmental harm. And both of those, I recognize the tensions and the difficulties and potential collisions between the state and the feds. But those are the reaching across the aisle type of solutions that I think are extremely helpful. And then just the final point on the governance issue, I have never, it's interesting about the independent agency aspect, I have never gotten a call from the White House about any vote ever at any time. I got one call that said you're doing a good job, give it up, and that was it. That's all I've heard from them. And that's, that I find interesting and the public should take some comfort in that and that's been a tradition at the FERC. And then secondly, another thing that I think has been a tradition at the FERC is virtually all of our orders have been voted out 5-0. Let me talk a little bit about, there's a consensus building process, let me talk about the Hatchabee because it was a great order. And I'm really happy with the Hatchabee. How many of you have driven by the wind farms at Death Valley on the way from Phoenix? Okay. I got a call from a commissioner in California who said, I just want to give you a heads up that you guys rejected, I said I didn't reject anything, this is right after I came to Washington. Said the FERC rejected an application regarding to Hatchabee. And we really think it's important, I want you to take a hard look at it. And I'm not going to tell you what to do, but take a hard look at this. It would require, I'll be honest, it would require you to reverse FERC policy. Okay. That was in, I think, July or August of 2006. Flashback to 2006, after I'd been nominated by the president but not yet confirmed by the Senate, I got a call from Chairman Kelliher, FERC chairman. He was a great, very affable guy. And he's actually someone who will listen to you and change his views in accordance with information, which is somewhat of a common trait. Among all of us, most or less bureaucrats or politicians. And he said, I'm going to be in Phoenix and I'm going up to Sedona, but if you have time to stop by me, I can meet you at the airport. So my son and I were playing ball, we were dirty, it was hot and probably 110 degrees. So I drove down to Sky Harbor and we had a brief discussion and at that point I was subject to pending confirmation, I was somewhat of a supplicant. And he raised the issue of renewables. And he said, I've followed what you've done in Arizona and it's really very impressive. We had ramped up renewables in 06 because we wanted to go even further than we had in 01 and were successful in doing so. And he said, federal law on renewables is, federal law on fuel source is agnostic. So I didn't want to argue with him because I wasn't a commissioner yet and I needed his help. And I did have the opportunity on Tehachapi. And I had presented information on Tehachapi and the idea was to recognize the unique nature of renewable resources, the fact that they're not deployed the way central station, coal or natural gas plants are deployed. And in terms of the timing of the cost recovery of the transmission necessary to get the wind to load, permit these projects to go forward, permit them to be financed in a way so that the temporal costs of the delay in deployment of the wind turbines would be recouped through socialized costs. And it's kind of a funny concept for Republicans, but that's the deal. But we could no longer be agnostic. And I told Joe, I went through my arguments and I didn't know whether he was agreeing with me or not. And he's a Georgetown alumnus. He went there during the Patrick Ewing solid era of the basketball team. I said, Joe, you went to a frigging Jesuit school. Agnosticism is inherently offensive to your core being. And guess what? We adopted 5.0. Most of the major FERC decisions, in my tenure, the big rewrite of Rob's 8.88 was order 8.90. Unanimous 5.0 decisions. We seek consensus. And the ideas that come from my colleagues, frankly, are much better than my own. And I'm more than happy to adopt them in orders and support them when they're in the benefit of the rate payer. And I know you want a reaction to Atroby. And that's kind of a governance issue that maybe is an unwritten but good story about energy policy in this country. For any questions from the audience. Mark has described a number of successes. But we're also, I mean, we're out of time. I think Mark acknowledges a crisis time in terms of addressing global climate change. Is it too incremental? And is the reliance on competition, one of the things Mark talked about was competition. And yet we have the competitive market here is one where we have a major subsidy to oil and gas through a write-off of all their reserves. And we have, on the other hand, a disappearing and reappearing occasional tax credits for alternative energy. And we have the tremendous cost of carbon dioxide emissions, all of which the market hasn't really done a very good job of taking into account. So is what Mark's describing enough to get the job done or do we need a more dramatic change to get where we need to be on energy policy? I'll start with a couple comments. No, we're not anywhere near where we need to be. I love to hear Commissioner Spitzer talk about tax credits because as a tax lawyer, he knows that conventional generating resources are all receiving significant subsidies. Everybody calls their own incentive an incentive and what other people get a subsidy. So when gets a tax credit, ours happens to expire every other year. So we have to go back in every dang time and use our whole budget lobbying for that, whereas the others are permanently in the tax code so they don't have to do that. So we need to get out of that bias system where I think the playing field is still not level. I wanted to, I guess another, so the second part of my answer is picks up on one of Barry's points or questions about governance and how climate change really cuts across many agencies and federal and state, really the entire public policy community, you might say. And Commend, it made me think of David Sandelow, the son of another Michigan dean here, has a great book that articulates this beautifully, I think. OK. So David also went to the law school here. And this book basically has something about addiction to oil in the title. And basically the idea is every chapter is a memo to the president from a different federal agency. And that, I think, shows exactly what each of those, maybe a dozen different agencies have to do in order to get us, wean us off our addiction to oil. Plug-in hybrids make a very big showing in that book. That's something that would be certainly great for the electric industry. And we in the renewable electricity sector would love to be powering our cars on renewably produced electricity. But it is something that cuts across transportation and all these other sectors. And so I do think, I don't know if it's an energy czar or climate change czar, but we do need to bring a whole lot of other folks into this discussion. Just to make a quick one and echo Rob's point. Clearly I don't think we're doing enough and the market is failing. But I also think that, especially in the states that have restructured, they're not going to roll back restructuring. And so the goal will be to use competition to achieve the efficiency gains that I think it already has delivered and find ways to incorporate in these markets. I think your example of the California ruling was an excellent one in terms of finding ways to try and meet the objectives of resource adequacy and efficiency and efficient deployment of resources in addition to internalizing environmental externalities that we all know exist. I do think that certainly in any future federal legislation, one of the challenges is getting it right or is right as possible. And I've been struck by the last two federal energy bills, which go on for hundreds and hundreds and hundreds of pages. How you see almost every kind of imaginable subsidy preference benefit for almost every imaginable possible source of energy. And it's incredibly hard to sort out. And even when one looks at what is often appended to cap and trade in related bills, it goes on for many, many pages with things that in some respects make a lot of sense if you break each particular case and each particular constituency down, but certainly cut against the thrust of the notion of competition and allowing for competition. And so how one really does harness the marketplace and get it right. And I say that especially in an American federal context where given the realities, regardless of political composition of the institutions of government, we don't make environmental or energy laws very frequently. And if we get it wrong, it often takes a long time to fix it. And so if we get one bite at the apple, whenever that might be, the challenge is putting all the pieces together in as positive a way as possible and not having something that five years later, congressional committees are screaming at future FERC chairs or heads of the Department of Energy or heads of EPA and saying, why didn't you get that right? And I could see that scenario. We have a question in the back and a question over there. And then we have a reception. So we'll just be pretty quick on our questions, be pretty short on our answers and then we can continue the discussion outside. So first and back and then we head over on the left. Can you talk about the recent National Transmission Corridor decision and also transmission cues and their inability or sort out transmission cues from some of the reliability. I came to Michigan for this and also for a panel tomorrow in Detroit on the queue. And so the good news bad news, there are a lot of proposed wind projects. The problem is they've overburdened the ability of the Midwest independent system operator and frankly all the ISOs to process them. And there are some participants in the queue that bail out of the queue and that disrupts the process of interconnecting. And there's a lot of complicated engineering that goes into interconnecting a resource. Wind is an intermittent resource. I think the engineers have historically been unduly cautious. They're conservative to a fault to maintain system reliability and they've unduly penalized the wind resource. But the queue conference is that I'm here to be educated on the queue in the state of Michigan. The first question of national interest electric quarters. That was not FERC. It was Department of Energy that propounded the designated the quarters and it's become a huge issue in Arizona. And I'm trying to mediate between my former colleagues in Arizona and the California Commission because Arizona rejected the Deaver's Palo Verde line that could result in jurisdiction coming to the FERC. To date, no application has been filed at FERC and it's my hope that it's like the mutual assured destruction from the 1960s that the FERC backstop line citing authority will only will not be used because the states will ultimately say we don't want the federal people on the Potomac citing power lines in Virginia or in Pennsylvania or in the other areas of the designated quarters. By the way, the Midwest is not a designated quarter because the Midwest has done a very good job, frankly, citing power lines so that you're not, you won't be harassed by us feds in that regard. Maybe some other regards. Your comments are fantastic. I was thinking you might occasionally get confused as a liberal crusader should you be careful here. But you know, you're talking about really taking on a lot of interest, some affluent interest, and I'm just curious how far you're willing to go. I'm thinking in particular on citing, wind energy has a terrible habit of showing up in the coastal areas of rich properties. I'm thinking in particular of cake wind. Are you really willing to go against Ted Kennedy, Walter Cronkite, Bobby Kennedy, Nick Romney? I mean, what's it going to take to really get no bless if oblige really... Well, you know, if government is not willing to stand up and do the right thing, it's very easy for the nimbleys to say, no. When government stands up and does the right thing and is willing to articulate that message and do extend the renewable credits, cap a trade, et cetera, put our money where our mouth is, then we can succeed. Interestingly, one of the most vocal opponents of Cape Wind was a former Arizona, the CEO of Phelps Dodge Corporation, who had the worst renewable record in the history of Arizona. And all of a sudden, he moves to Cape Cod, and he becomes an environmentalist. Friends, that is bullshit. Oops, I forgot. I'm on tape. OK. Thank you very much. Thank you very much.