 Energy in America here on ThinkTech on a given Wednesday with Lou Pulirisi, who is the President of EPRING, the Energy Policy Research Foundation in Washington, D.C., and he joins us from Washington, D.C., and we want to talk about policy, the operative word is policy always, and we here in Hawaii need to know what's going on in the rest of America, and Lou can help us. The title of our show is the Green New Deal and the Green Real Deal devised by Ernest Moniz, who was the energy secretary under Obama. Very important that he should speak up on the subject, and now we have two hands clapping. We have AOC and the Green New Deal, we have Ernest Moniz and the Green Real Deal, and I guess what that's saying is it's real rather than hypothetical. So tell us more about it, will you, Lou? Yes, so I thought we would talk about, of course, I think we did discuss a few weeks ago that when Ms. Cortiz, the congressman from Brooklyn or Queens up there in New York City, proposed this rather extraordinary policy shift in the United States with Senator Markey from Massachusetts that received a great deal of criticism, but it also receives a great deal of support among many younger members of the Democratic caucus on Capitol Hill. And one of the interesting things about it is that when you go through it you see how unrealistic it is, but I thought what was interesting is that Ernest Moniz, the former secretary of energy, has been working diligently on something called the Green Real Deal, which is part of something called the Energy Futures Initiative, and what I'd like to do is talk about what's in that deal as opposed to the New Green Deal, the Green New Deal and why even Ernie's idea and proposal represents a very, very heavy lift and a few items he has not had a chance to confront directly, which I think represents an enormous obstacle, something that we're going to have to think about and deal with as we proceed. And as always, we're going to show a few numbers because you know people don't like numbers in Washington because they make some of their ideas look silly, so we'd like to show the numbers anyway. Okay. So, you have some charts that will help explain this? Yes, so I do have some charts that will help explain it, and so let's, maybe we should begin. Okay. So, the first one is the kind of, you can see in the background, Ernie Moniz has a kind of George Washington, Benjamin Franklin haircut, it's, I don't know exactly why he does that, but he's a distinctive characteristic of him, people can recognize him easily. And you know his basic, I think his basic view is look, you can't put together one of these projects to transform the American energy complex without dealing with a whole range of not just technical issues, but political issues including coalition building, including addressing workforce issues, addressing the fact that some folks will be left out of the mix or their traditional way of doing things will put them out of work. And you have to really kind of, you need enormous commitment to do this. And I think that for that you want to command Ernie, I mean he's really tried to think this through instead of just using a bunch of talking points or buzzwords that will get millennials excited and then they'll forget to wake up on election day anyway, so I think he's sort of, he's sort of gotten a more serious approach. Let me ask you this little, Lou, talk about political realities, talk about the pragmatism of trying to get the program through Congress, which won't be easy in any event, and certainly the Green New Deal with AOC's Green New Deal will never get through the current Congress, it'll stop at the Senate for sure. But I think it won't get through the House, okay, I mean no rational politician is going to vote for something like eliminating air travel in 10 years. There are people in Hawaii who might vote for that, and then after they vote they might think they, oh we just committed sapooka, nobody can fly here, so I do think that, so I do think if you want to do this stuff you have to have a hard headed discussion, I'll give Ernie credit for that. Well you have to have, ultimately you have to have somebody in the White House who is interested in Green Deals of any kind, and if Donald Trump stays president, neither of these programs has a chance, am I right? Yeah, I would argue not only does neither have a chance, even if he is not president, even if Joe Biden is president, many aspects of even Ernie's ideas will be difficult to achieve. I'm not saying they can't be achieved, but I'm going to tell you why. Okay. So we go to the next one, I think this is what's interesting, the next chart, which is essentially this is the Energy Futures Initiative. That's kind of a very clever chart that shows all the things you need to do if you're really serious about this issue. And I was very struck by this that he's, they've fought through a lot of things. For example, if you go to the left-hand side there, carbon pricing, right? You need to put a price on carbon if you want people to use less of it. Then as you move up an innovation portfolio, this is kind of the Bill Gates idea. Look, you're going to beat this thing with technology. You're not going to be able to do it with a command and control approach, right? Maybe even carbon price, you need new technologies. You have to deploy an energy system which is cheaper than what we have now, otherwise close to what we have now. Otherwise society is not going to, the public is not going to accept an energy complex which is three or four times more expensive than what we have now. It's just not going to happen. You need to have very sustainable and secure supply change. People have to believe that this energy is secure, large carbon scale management. This is to collect the carbon and store it somewhere underground. You need a workforce, right? You need a workforce that knows how to repair solar panels and build wind and develop these new materials. You need an infrastructure that can withstand shifts in the climate. Whether it's sea rise or more severe storms, whether you believe that equitable transitions. You can't just tell the United States now is the largest producer of oil and gas in the world. With our North American petroleum partners in Mexico and Canada, we are net exporters to the world market of almost 400,000 barrels a day. It's worth a trillion dollars. It's a force of security for the world oil market. You are not going to remove that production in any political sense in a short period of time. You're going to have to find a way to make it cleaner, to make it less carbon intensive. But the notion that you politically could tell the state of Texas, by the way, I think everyone should just go home tomorrow because they're not going to produce any more oil and gas. It's just not going to happen. So I just don't understand where people are so unrealistic about these things. Well, does Ernest Moneeus say, does he say how long he thinks it's going to take to transition under his plan? I think, I don't remember the exact number, but it is a plan really to get on the gradient, to get on the curve. It's going to take 30 to 40 years. It's going to take a long time. And I think even Ernie would agree with that. And it takes a real political commitment even to do his. And at least his has got a basis on a lot of thought on social equity and all the kinds of things you need to do to make these things happen. Let me add one other point though, and that goes back to the president. So we may not have the same president for two terms in a row or three terms in a row anyway, and people may change their minds. And if they are inconvenienced or it's costing them too much to follow Ernie's plan or any plan, they're going to change their minds. They're going to change their president. And 30 or 40 years could see all kinds of changes in the way we look at this. And it may fail. Right, right. The lack of consistency. You know, very easily if something does not make sense in terms of it's sustainable as an economic model, if it doesn't make sense, it will not last. You know, we spent, people forget, we had something called the Sin Fuels Corporation in the 70s. And the joke was it was always $5 a barrel more expensive than the price of oil. And we spent billions of dollars on it, billions of dollars. But it was not economic. And eventually we gave up methyl hydrate. I can just go through, you know, the landscape is littered with these government projects, which did not have an economically sustainable basis to make them last very long. So that is actually the real problem. And one of the things I think we don't, we also need to kind of incorporate into our models is, you know, a clear understanding that just because I pick when our solar, and it has one dimension, that is, it produces energy with a low carbon footprint after it's constructed, it doesn't mean that deploying that technology is free, either in terms of capital, but also in terms of carbon. For example, right, the International Renewable Energy Agency calculates that the solar goals for 2050, right, consist of what the Paris Accords done. You know, this is the agreement that Trump pulled out of, but that it will result in a disposal of old solar panels, more than double the tonnage of today's global plastic waste, right. A single car battery, a single car battery, weighs about 1,000 pounds, fabricated is going to require digging up, moving and processing more than 500,000 pounds of raw materials. So I think no one talks about this, but this is really important. Building one wind turbine, just one wind turbine, right, requires 900 tons of steel, 2,500 tons of concrete, and 45 tons of non-recyclable plastic, right. Solar power requires even more cement and glass, not to mention other metals. So you're going to have a huge jump in mining and earth removal, and much of this development is going to take place in parts of the world, in Africa, in Latin America, in parts of the world, in which they don't have good attention to sensible environmental practices, where they exploit child labor. So I think that all of these things are going to have to be addressed if we want to radically transform the economy. And no one's talking about that. So I want to tell us, compare the two programs. What is AOC saying her program would be versus what is Ernest Moniz saying his program? So if you go to the next slide, you can see what AOC, you know, she, this is a very aspirational program, elimination of cows, subsidies for those unwilling to work. You know, they're wandering all over the map here. They're not even talking about, you know, alternative fuels so much. And upgrading all existing buildings with energy efficient technology, and doing this in a 10-year mobilization form. It is so ridiculous, and that it's, and it's such an easy issue to run against that really, you need to discount it entirely. I mean, I don't even know why people are talking to this woman. She's a kind of idiot. Moniz is a more serious, I think the Moniz proposal is a serious attempt and understanding that you have to build political coalitions, that you have to deal with the entire supply chain, and that you need a long term sustainable commitment. Well, don't you think that AOC's points, some of which are really, you know, out there, and undoable, clearly from every point of view. It's kind of a, you know, a by-speel. I mean, it's a first offer. It's throwing it on the table, seeing how people react, seeing which points they like and don't like, and letting Congress decide, you know, which, where is the statue in the marble? Let's start carving. Possibly. And maybe even with her, in her thinking, she wanted Moniz to come up with some alternative, she wanted the conversation to start. What do you think about that possibility? Anything's possible in Washington, but I would say that if you had the opportunity to watch the Democratic debates, I would suggest that these things occur in a political environment, and if you're going to be rolling out these ideas and expect the opposition not to take them and beat you over the head of them, it's sort of naive. So we're going to have Medicare for all. Well, it turns out not everybody is for Medicare for all. Sounded like a good idea at the time, right? So I just think, you know, so the United States is a really big country. You know, it's part of a massive, it is the largest economy in the world. And, you know, it's like, if you can imagine the largest aircraft carrier ever built by mankind, you're not going to turn it around. It's not going to corner, it's going to have to be moved very slowly, a few degrees one way or the other, and it has to be sustainable. So my concern with the AOC thing is that, of course, it's ridiculous. But even Ernie's, I want you to understand that Moniz, who has a very thoughtful plan, a plan that makes, in many sense, if I were of that political band, or if I was really nervous about climate, or I thought this was the only environmental issue to worry about. Yeah, I could see that gaining traction over time, but it won't happen fast. It's a long game to transform the National Guard. And that's separate from the issue of whether it's a good idea. But of all the ideas out there, it's one of the better ones. Well, the candidates talking about it in debates, is anybody warming to it? We've seen newspaper articles and magazine articles, but is there any traction here? So I think there's a big disconnect between what the candidates say. I mean, do you really think Joe Biden or Trump know what they're talking about when they say, I don't care about climate or I care about climate? I don't think they understand any of the details. And maybe that's not their job. Their job is to hire people who can kind of build a coalition to do that. So yes, Biden says he's going to rejoin the Paris Accords. All the data we says, it doesn't matter whether we're members of the Paris Accord or not. In fact, something that no one likes to talk about, but of all the countries in the world, for the last 12 years, the U.S. has the best performance in reducing its global emissions of CO2. Yeah, I think you find that hard to believe, but that's what the Energy Information Agency data show. And although U.S. emissions went up a bit last year since 2000, or even going back, I think 95, we are the world leader in reducing emissions of CO2. And the reason for that is quite simple, natural gas. Natural gas has driven out coal use in the U.S. And in fact, if we go to the next chart, you can see that. This one shows, well, let's start with this one. This shows you that if you were to listen to all the newspaper reports and all the issues about the emergence of renewable fuels, you can see here that after massive subsidies, massive subsidies, the U.S. now is producing about 10% of its power generation. I'm not talking about total consumption in the national economy. Just in the electric power sector, it's producing about 10% from wind and solar. And you have to be careful when you look at this data because this data shows the actual power that was generated. You can read all this data that we have installed capacity in it, 30% in California, 40% here. But just because you have installed capacity doesn't mean you can deploy it. And that's the real issue, right? You can't deploy wind when it's not blowing or when the demand is not there and that goes for solar as well. So here we are after spending all this money and I'm telling you we have spent a ton of money. We are still at about 10%. And probably we've got hydropower of seven or 8% more. Which is an old technology in many ways, but is in any way, think about it, is a renewable technology. You know, it strikes me looking at this chart. I know this is not where we're going here today. But on a national level, the amount of wind is like four times the amount of solar. That is not a case at all in Hawaii. No, but it doesn't matter what happens in Hawaii. It's too small, okay? Okay. All right. Just observe it, that's all. It doesn't matter. I mean, I know people don't like to hear that but Hawaii is a beautiful place, a wonderful place. But in the global status, it's not important. That's why we need to talk to you. As I've said before, if you live in Hawaii and you're worried about climate, you should be worried about adaption. You're not going to save the world in Hawaii. Absolutely. Or solar power. Okay. You have another slide you want to show us. I do. Let's keep going. Let's keep going. All right. This is a different... So the last chart we talked about, power generation, right? But when you look at the entire energy mix in the U.S. and this is for trains, trucks, transportation, petrochemicals, everybody uses wind. Everybody uses electricity in the U.S. You can see that the transportation sector is still... Petroleum in the U.S. is largely in the transportation sector. And you can see that wind and solar is only about 4%. Maybe a little bit more in 2018. But when you take all the different uses of energy, not just in the utility sector, there's still a very small amount. And I think that is something we really need to remember, that this is a big, big mountain decline to sort of replace all these traditional fuels. It can happen. And if you go back to the beginning of the modern age, or even from 1500 on, as we have often said, there's really no instance of the world using less of any fuel. Just new fuels come along. So the question is, for the U.S. in which power, the electric power sector only grows about 1% a year at the most, we really don't have... Our power generation is largely installed and growing slowly. This is a problem largely outside the U.S. And then the problem in the transportation sector is going to be a very, very difficult one. And it's quite interesting, you know, the amount of new minerals that we're going to need to sort of transform the entire automobile fleet to battery power is, I think, it's such a big task that few people have talked about that, what it's going to take. And whether we're willing to tolerate the environmental damage from the mining and the development of new ores and rare earth materials, which, by the way, most rare earth minerals are neither rare nor it's sort of supplied, they're just... They require a very dirty and aggressive refining process, which is really unacceptable to most communities in the U.S. I think it's complicated by the fact that not all these minerals and resources are available in the U.S. We have to report some, including from China. And China and the U.S. are in a trade war right now, so it becomes questionable exactly how reliable that source is. Right. And we do have a big effort in the U.S. to look at... And we do have a lot of rare earth minerals in the U.S., I want to point out. We can mine them, New Mexico and the bad and other parts of the U.S. But the question is, are we prepared to build the refining facilities? It's not just... It's not like you just dig it up out of the earth and, you know, well, here's the gold nugget, just send it over to Tesla. It doesn't work like that. You've got to take these materials and then process them in a very elaborate process, treat them with solvents and chemicals, and fabricating them, and it's going to be a quite extensive process. And you know, this is this old joke that the engineers, you know, if you talk to engineers, they say, look, one of these days, don't worry, we're going to find unobtainium. Unobtainium? What is that? Unobtainium is the thing we don't have, a magical energy producing element that appears out of nowhere, requires no land, weighs nothing, and emits nothing. Everyone is looking for unobtainium, but we don't really have that, you know. But you know, there will be new technologies, there'll be technologies with energy and transportation, there'll be new technologies in extracting it and processing it, and this could change, you know, the course going forward, no? Right. So my view is that, so it's not, if you can't, I guess as a politician you can't really sell this, but look, the right answer is to get on the gradient, probably put a price on carbon, and try to make progress along some curve where you can learn as you go along, where you are not completely disrupting the whole national economy or people's lives, first because if you do that, people will rebel. We're still on democracy, people say, no, I don't want to do that. So I think that that's, and to get an idea, let's see if we can go to the next picture here. Yeah, so here this shows you, so if we go to the next one, let's go to the next one here, I think this gives a little better sense. Okay, I think this is a very interesting chart, and this is from Ernie Moniz. And if you look around the country, you can see that, for example, Arizona, Utah, Colorado, New Mexico, they have extremely low power costs, about $0.10 a kilowatt hour, and you compare that to the West at $0.16. Now, probably that number is a little bit higher in California because Nevada has lower costs, but, and per capita consumption in California, it's probably a little bit like Hawaii, that good weather. You don't really have a high, most people in California live on the coast, so they can pay a high amount per kilowatt hour, but the actual cost per person is not that much. But what's interesting about all these is that as you go with more, except for Hawaii, of course, but as you go with more renewables, your power costs rise. So one thing you have to be is honest with the American population. Say, well, yes, I realize the Sierra Club told you that wind and solar are free, but it turns out you have to, like, build these things and connect them to the grid, and they don't work all the time. So that's not really free. It's going to cost you about a third more. Now, in the case of Hawaii, it's a unique problem because you don't have sort of traditional continental scale utility systems, and you rely heavily on petroleum, but for the rest of the U.S., the evidence in the chart there from Ernie, and it's been around a long time, is that as you ram more renewables into the system, the price electricity goes up? Well, that leaves us with an interesting place because you have these two competing plans, neither one of them is fully realistic, and you don't have a national energy policy that is really popular among the people right now, and you don't have a debate that's going on that shows you the way to the future of a national energy policy. Without a national energy policy, you know, we're not going to be able to achieve a whole lot. So what do we do now? You had one minute to answer, though. OK, what we do is we continue to invest in R&D to look for low cost and system-wide costs that are acceptable, that have a good ratio of economic benefits to cost. And we try to move in an opportunistic way along the gradient and make a very careful assessment of what we put into adaption and what we put into new technologies. And as one of the Democratic candidates said, oh, well, it's too late anyway. It's time for everyone to move to high ground. That's really pessimistic. Exactly. Well, I hope you will take us through the channel on this and show us the way, show us how it evolves, because I think there'll be a lot more discussion between now and November. Absolutely. I mean, November next year. And I look forward to exploring these issues if you want an ongoing basis, Lou, because they really are a statement of our future. Anyway, Lou Plurici, the president of Epring, the Energy Policy Research Foundation in Washington, we enjoy so much talking with you, getting your perspective and seeing the thing on a national scale. Very important for Hawaii to understand that. Thank you so much, Lou. Thank you, Jay. Aloha. Aloha. Talk to you soon. OK.