Experts Only Podcast #105 with Taite McDonald, Expert in Commercializing Energy Technology

[ Partner at Holland & Knight LLP ]

Listen now:

Transcript

Jon Powers:

Welcome back to experts only. I’m your host Jon Powers. I’m the co-founder of clean capital and served as president Obama’s chief sustainability officer. On this podcast, we explore solutions to climate change by talking to industry leaders about the intersection of energy, innovation, and finance. You can give it more episodes at cleancapital.com.

Jon Powers:

Welcome back to experts only. I’m your host Jon Powers. Today, we dive into the exciting things that are happening in Washington DC, with the influx of capital on things like the federal infrastructure bill let’s move forward. And we brought one of the leading experts and understanding the bridge between what your company’s doing and how to really access and understand the money that’s moving in the federal space and that’s Taite McDonald. She’s a partner in Holland & Knight. I’ve known Taite for a long time. She’s been named as one of the leading top five electric vehicle lawyers in the country. She also works really closely with the department of energy in the loan program office to figure out how companies like yours can understand and access this once in a generational investment that’s moving in the federal space. As always, you can get more episodes at cleancapital.com. I hope you enjoyed the conversation. Taite, thanks so much for finally joining me on Experts Only.

Taite McDonald:

Thanks, Jon. I’m so excited to be here today.

Jon Powers:

Yeah, me too. This has been an interview I want to do for a long time. I’ve been trying to work it out, but actually timing couldn’t be better with all the stuff that’s happening in Washington today.

Taite McDonald:

Yeah, I completely agree. It is the time to talk about all of these things that we’re going to cover today.

Jon Powers:

So you grew up in Pennsylvania, you went to school for political science, but then went to law school. You’re sort of now living at the apex of those two things and the work you do, but really what, first of all, what got you interested in political science?

Taite McDonald:

Yeah, that’s a great question. So I was just like everybody, I wanted to have impact and I on the greater good in the world. So I knew going into school that I wanted a very robust career. And I wanted to make sure that I worked in a few corporate environments. I wanted to make sure, I really felt as though I was contributing something to the greater good.

Jon Powers:

Right. And in that process, was energy climate clean energy stuff on the horizon, or was it sort of politics and law first? And then you sort of got this big interest?

Taite McDonald:

I’m not the most political person in one extreme way or the other, but what really got me into it was the energy side. And I will say I’m a little different in that I went to law school. I knew I was taking a chance in going to law school because I did not want to be a practicing lawyer. So my second year, and I knew I wanted to do something when I really started my first and second year of law school. Thinking about what I wanted to do, I started being attracted to just environmental law, but because I didn’t want to be a traditional lawyer, I knew I had to find something in that nexus. And my story about it is actually really cool because I spent the whole second year thinking of law school I’d taken on this debt knowing I didn’t want to be a practicing lawyer.

Taite McDonald:

Ironically telling all of my classmates, I would never be dumb enough to be at a big law firm. I only wanted to partner at a big law firm today, which is another fun fact, but the bottom line is just that when I took my second year and really evaluated, okay, how can I make the world a better place? How can I make a better solid life for my family? And how can I do something I’m passionate about? About eight months after I started thinking about like what falls in the center of those concentric circles. I discovered traditional lobbying on the hill for Totrova, which was a bi ancy of kids stuff that has never made it. So, that is what really started me on the path to what I’m finding that, led me to the path of where I am at.

Jon Powers:

Interesting. When you and I first met, you were at Wilson Sonsini, right? One of the really interesting sort of Silicon valley tech firms. And at the time now this is around 2008, 2009, you were helping build a bridge into what was starting to percolate in the federal administration space. And now you’ve really built a diverse career in that space. And we’ll talk more about all the things that are happening, but if you can sort of reflect on the progress in the last 10 years there, I’m going to steal your husband’s quote here and say that you’ve been training for the Olympics for 10 years and is finally here. What experiences did you sort of pick up over the last 10 years that led you to be prepared to sort of launch into the Olympic game here?

Taite McDonald:

Yeah. For a sport that never existed.

Jon Powers:

Yeah. That’s right. For a sport that never existed.

Taite McDonald:

Now it’s here. Now it Exists and it’s quite popular. So what was interesting when I went to Wilson Sonsini it was right when they had closed Cendra and Tesla so the best in the world. I’ve started to now say I’ve become the encyclopedia of LPO because my career really started with the best in the worst. I naturally saw everything in between and I stayed at Wilson for seven years, ended up running the practice and then came over to Holland & Knight and all for a very strategic reason, which is key to what we built, what my team is today. But the bottom line is just, what was really interesting is Wilson didn’t want us to register the lobby and had all this federal, had all this LPO work.

Taite McDonald:

So I needed to find really, I took that five years, found everything in the executive branch. That would not require lobbying registrations that had to do with energy and clean tech. And what was fortunate at that time is everything was ramping up. So I had time to ramp up in all of the different, this DOB sector, where we met the ERE programs. The Wilson practice was originally run by a deputy assistant secretary of ERE. So that’s how we learned everything about ERE the loan program, because the natural influx there, and then you can have things like GSA and really all of the other DMD market. It was a very natural learning curve if you, I learned as things developed throughout the Obama administration.

Jon Powers:

Yeah. And for folks that don’t understand sort of the Washington side of it, like lobbying you’re often officially trying to affect what’s going on in Congress, but with Taite’s untold world so well, she really helps shepherd cutting out technologies to figure out how to find the dollars that are moving through the government and for the things like the loan guarantee program, or some of the other sort of four leading offices, people may not know how to get grants, but they often work with you to figure out for instance, how to apply and how to shepherd through that process. So you move to, to Holland & Knight and have stood up really the leading practice in this space. What at Holland & Knight sort of gives that platform, a unique position here to continue to scale as this steroid injection of capital is coming into the federal space?

Taite McDonald:

Yeah. So what had I love the time at Wilson. I love the technology. I got to see so many things that are now coming for fruition. I worked on at the beginning, like even Solid State Batteries, you name it. I worked on it 10 years ago on energy management software. The initial distributed solar grants wrote the first DOE grants in that space so I love the technology, but what was occurring is the West Coast based platform. My practice was growing beyond the needs of the west, beyond what the West Coast base platform had.

Taite McDonald:

So Holland & Knight now we have over 1700 lawyers with an energy merger we did this summer, but what’s unique about Holland & Knight is so we have a very robust now because of our lateral strategy energy transaction practice. But what’s different is we have an 80 person policy shop where I sit in that’s completely seamlessly integrated with the energy transaction work, as well as in more key, honestly the government contracts work and the GSA work and the DOD government contracts work and that also supports all the DOE grants. So now we have this essentially suit to nuts approach that can help companies through all stages of working with the federal government in any capacity.

Jon Powers:

Can you paint a picture of like what your standard client, I mean, give some examples if you want. I don’t know if you can talk about them by name, but just paint a picture of a couple of different clients that you have so people can understand, like how would they approach you to get access to some of these programs?

Taite McDonald:

Good question. So I won’t use names just so I don’t confuse who I have permission to name in public. But the bottom line is a lot of what my clients come to me, our specialty which will get into is really that last valley. I don’t want to call it a valley of death cause it’s not always the valley of death, but that last stage to either first commercial facility or broad deployment. So really what’s also in addition to the government funding, what’s really set our practice office. What I like to call the spark attacks in the market. So really, I mean, what we are great at is when a company is sitting at that last stage where they either they need to build that first facility or the larger facility, or they need their technology deployed across the country, right? So for example, actually one that is definitely public because it is a lobbying registration. Now, I do lobby sometimes where we need the two branches to work together.

Jon Powers:

Sure. Of course. Yeah.

Taite McDonald:

Yeah. And one is one example is Volta where we’re deploying charging stations across the world.

Jon Powers:

I want to come back to your specifically like your electric vehicle and charging spacing work, because it’s such a dynamic piece right now, especially the infrastructure money that’s coming forward. But before doing that the Biden administration has come in with really aggressive goals. The infrastructure bill has passed, unfortunately Build Back Better has not passed yet, but there is unprecedented money moving into the stuff that we care about around infrastructure and the private sector side a lot of capitals lining in and lining up to add out of that, right? To be sort of a force multiplier in this space. But you really have become probably the leading expert in the loan guarantee program. The loan program office that we recently jigger on the program talking about what’s moving in this space for folks that aren’t fully aware that office ramped up really disappeared for a few years as there was a political flashback on some of the things that unfortunately were, I think in many cases, sort of partisan attack as though it’s been a very successful office.

Jon Powers:

And now there is a new dynamic leader was a lot of capital, like what should people be thinking about that office and where opportunities are for companies?

Taite McDonald:

The bottom line in the federal government right now is everybody needs to be. Everybody that is, especially at that stage if you have not already, where you have just done a public offering or you are to expand, looking to deploy more broadly now is the time where you have to do an evaluation of the federal space. So for instance, what our practice does that makes it a lot easier for companies to really grow stage companies, to get excited about working with the federal government. That’s a little different than how others have approached it in town is we know a lot of this off the top of our heads. We’ll work with you either through an LPO evaluation to determine if LPO is really something that you should be doing. I will say, I start a lot of those conversations saying this is going to be very, very challenging. Are you sure you want to?. We’re going to make sure you really want to do it.

Taite McDonald:

It’s the best thing for your growth strategy, because it’s not the best thing for everyone. But the bottom line is no matter if you are at that at stage, because the amount of funding going through the loan program and the momentum with the loan program. The other thing we did on the lobbying front, and the reason why you’re seeing the loan program in a lot of people think the Biden administration and Jigger Alone is the re-spark of the program. But we actually have been running an informal coalition with all of our clients to educate capital hill on the value of the loan program. So a lot of changes and improvements have gone through legislation even before the bipartisan act and the 2020 energy act. So the bottom line is you has to, because those changes and combination with where Washington is, you really have to evaluate loan program and then look at the other grant programs too.

Jon Powers:

And then yes, let’s talk about some of the other programs because the office of commercialization is it commercialization and development OCD?

Taite McDonald:

The clean energy demonstration.

Jon Powers:

Oh, clean energy, sorry. Clean energy demonstration also has received a significant influx capital, right? To start putting to work. What should people look at that differently from for instance LPO and some of the other options that are on the table?

Taite McDonald:

Yeah. Great question and even my team and I were laughing about this yesterday because there is a clear defined pot of money. That’s around 30 billion for the office of clean energy demonstrations. That is focused on hydrogen, CUS and Grid Resilience and Nuclear. That is the clearly legislative OCD. OCD pots of funding. Now, in addition to that, there is big pots of funding. It’s 6 billion for batteries and material supply chain, as well as other pots of funding for like direct air capture hubs. It’s too aggregated. That’s about 40 billion across cash that will be administered in grants with different cost shares across the next, over the next five years but what’s interesting what you have to keep in mind about that money is it does not cover every segment of the industry because it is just from bipartisan bill.

Taite McDonald:

So, that’s the evaluation you really have to look at. And even a lot of like for instance, a lot of people are coming to us for the hydrogen hubs and I’m like, that’s going to be the most competitive pro new program out there. If you’re just one small component, you shouldn’t be looking at the big hydrogen hubs. You should be looking elsewhere. So that’s what we’re doing with companies as they come through. But even like I said yesterday, my team and I were looking through the IIJAA again and found like probably a few more billions of dollars that we weren’t even tracking.

Jon Powers:

Wow. Yeah.

Taite McDonald:

For the industry as a whole.

Jon Powers:

So of the firm, I want to get to electric vehicles and infrastructure and charging stations in a minute, but of the technologies that are coming forward to you, right? Some of the companies that are developing here what do you sort of see that’s most exciting? Like if we often look out in the next 10 years in this show and talk about this decade in particular is what’s going to if we’re going to get the resolving climate change, it’s going to be the work that’s done today and the commercialization that’s going to happen over the next 10 years. Like what are some of the really interesting solutions that you’re seeing? If you could talk about some of those opportunities. Not giving away anybody’s IP.

Taite McDonald:

At least I know who I got approval in the EV article. So at least I, for specifics there, but the bottom line is I’m like, where do I even start? Because, it’s also like Christmas every day. So not always every the Olympics, but it’s Christmas every day because what we’re seeing, I think it’s more it’s, you can see in the press in the headlines. All of the new applications, even like what we’re seeing in electric aviation, electric voting, electro, like all of the direct capture, the hydrogen applications, whether it’s production deployment or transportation. And then when you go into the supply chain and the technologies around recycling for battery supply chain. There’s just so much amazing technology out there that now has capital sufficient to deploy and market support. And then you have some incumbent technology that’s just really it’s becoming really sexy because the way you can actually deploy and reduce GHD emissions.

Taite McDonald:

So really I think what the next year or two we’re focusing on is, and I’m incur like my team and I are building out is like, how do we, and I’m going to get a little philosophical here. How can we be responsible to make sure we didn’t have the same mistakes from the stimulus? And make sure the funding is going to these technologies that can actually deliver on time expansively, commercial, and then make sure we can realize the opportunity that Congress intended out of this legislation. So that’s, what’s really exciting to me is we’re, we’re at the precipice of this amazing opportunity, but we have to do it right.

Jon Powers:

Yeah, absolutely. And outside of just the process that’s so, I mean, there’s got to be communication. Telling the story of these successes so that we don’t run into the same issues we had and the Obama administration, when people work to kill these programs, when a bad story get up versus helping to tell the story today. What’s working and continue to do, I think with the coalitions doing right which educating folks in the hill about the progress.

Taite McDonald:

Yeah. And it’s a great example because as a result of that coalition teaming with the NGOs, we all put together the same mask with everything else in Clean tech that mansion’s struggling with right now. We got more money than we asked for even. So it’s a great example of like Washington works when you communicate appropriate stories in a bipartisan way, I mean, the loan programs, just such a great example of success in the industry when things are communicated to Washington.

Jon Powers:

Awesome. So let’s talk about-

Taite McDonald:

It could have been worse. We couldn’t have started in the man slide.

Jon Powers:

That’s true. Its true. So looking at I think we had a doubt the thing that’s probably touted the most right now. And some of the stories being sort of talked about by the administration and others, is the electric vehicle space and the infrastructure space we couldn’t have done this five years ago, even if the money come in because the market place wasn’t ready, but the marketplace is ready now. You’ve got major car manufacturers moving diligently in the space. You’ve got the EV charging stations finally in a position where they can start to grow. Like what do you sort of see the money being put in, first of all, what kind of money’s going in for EV and infrastructure? And two, like what do you see that mean in terms of deployment for everyday Americans, right? What does that mean five or six years from now in terms of being able to take electric vehicle and find a place to charge it?

Taite McDonald:

That’s a great question. I didn’t expect it, you to come at it from this way, but it’s a phenomenal question. Cause-

Jon Powers:

Before you I answer that, I want to point out that Taite been named as with the top 10 EV lawyers in the country. So we definitely have to focus on this one.

Taite McDonald:

Well, and I think it’s a great. And you know this because you were in the administration that time, but the bottom line is like, there was so much excitement and enthusiasm for batteries supply chain EVs in 2009 to 2011. But we weren’t at the place where, for so many different reasons, we are at a really challenging place with the federal government if you may. So that’s why we had some success stories, but then not other, we didn’t get as far as we would’ve hoped to. And some cases I think.

Jon Powers:

And the technology wasn’t ready. It was just new on the other sect.

Taite McDonald:

Exactly. Batteries, for example, weren’t ready until 2014. So we couldn’t and so the bottom line is just that what happened and what I’m I’m honestly, I tell people like on my death, this will be one of the things I’m most proud of already is in 2018, we started to get momentum within the Trump administration events. So bipartisan Congress, Trump administration for Battery Supply chain for either going into like all battery applications, right? So maybe not EV focus, but we took, I had worked some on really Molly Corp in 2009, back in 2009. So had a lot of experience in supply chain and one of my mentors taught me very early batteries are the holy grail, right?

Taite McDonald:

So in 2018, when we saw the opportunity, we took the integrated Holland & Knight platform to start to do exactly what we did with LPO to build a battery coalition essentially where because we started with a company or two, I actually started with the core power supported at first. I have to give them the shout out, but we couldn’t get anywhere with one company we were getting like, we could hardly get anywhere on a billion dollar ask in 2019, 20 right? And so what we did, so then over between 19 and 21, we aggregated very complimentary battery companies started bringing them all together, teamed with another coalition. And in the IIJA, their 6 billion for battery.

Jon Powers:

Explain what the IIJA is for folks.

Taite McDonald:

That’s the infrastructure investment. So the bipartisan act that passed. So what not only did we do, we had two main goals to fix tweak some things with loan program to open it up for batteries and vehicles again, because the way it was being defined was that’s why you don’t see a lot of those project go through strictly defined. So we work to open up the definitions to support the sector and then lobby for the batteries and material funding. The combination of those two is what’s going to help the federal government really support this sector moving forward. And then plus I can’t forget and the charging funding that is going to go through DOT2 there’s 7.5 billion that already has a request for information charging funding.

Jon Powers:

So let me go back to like, what does that mean for someone here in Buffalo, New York, five or six years from now being able to get access to an affordable electric car at a place to charge?

Taite McDonald:

Yeah. So the bottom line, so the charging funding will actually deploy chargers, will help to deploy chargers across the US. So there’s no longer going to be, especially in an area like Buffalo or in areas where it’s colder, there’s going to be more access to public charging and charging of a long court course, right? Which is obviously a key hurdle to, and perceived hurdle to many people owning that is key number two. What’s key to opening up the market is that this funding is going to enable the companies to produce, to actually produce up more applications in the US in a more cost competitive manner. We haven’t been able to compete with other countries in some cases, especially in EVs because of how other governments support their companies versus how the US government supports companies. And that is what’s great. What’s really good to know is a significant amount of the EV sector was there’s a lot of frustration. Well, if we don’t get BBB, we’re going to lose everything. A significant amount of the EV market is actually very well supported by IIJA. More needs to go.

Jon Powers:

Yeah. You separated the two, like I think standalone storage, some of these other that’s where BBB would’ve been really helpful, but for EVs and EV structure the money’s there.

Taite McDonald:

I don’t want anybody to come at me because there still needs to be more right. But like, there’s a lot of work. Like we’re already doing that work on the deployment dollars, like all that work’s in progress now. And we can’t do the work until passes Congress. So it’s just a really good sign for the market.

Jon Powers:

We could always do more, but this is a once in a generational investment that’s already being made, right? That we have to take full advantage of the matters.

Taite McDonald:

It’s more than we’ve seen our careers and yeah. Probably will see again. And I want to point out one key difference. Cause a lot of people are apprehensive like, well, I’m not ready now. And in 2009, I wasn’t ready. And then there was no funding there. So why would I even miss my time? One of the key differences now is that a lot of the staffer realized how they were there and how to have experience from 2009. So this is all five year funding.

Jon Powers:

Right. So I’m going to just wrap up with sort of a reflecting question for you. If you went back to growing up in Pennsylvania, you’re just graduating from Gettysburg and you can sit down and have a beer with yourself and give yourself a piece of career advice. What would you say?

Taite McDonald:

Anything is possible. Don’t give up.

Jon Powers:

I love it. I love it. Taite, thank you so much for joining us. For folks that are not familiar with Holland & Knight, definitely understand the impact that firm is making in Washington is a way to both develop your federal strategy and get access to some of the dollars that are moving in this once in a generational investment. So thank you so much Taite for joining us.

Taite McDonald:

Thank you so much for having me. This was awesome. Always awesome.

Jon Powers:

Absolutely. It took too long to happen my fault, but we had a pandemic in the middle. So wanted to thank your team at Holland & Knight and thank our producers, Colin Young and Carly Batten as always for helping to put this together, you can get more episodes@cleancapital.com and you look forward to continuing the conversation.

Taite McDonald:

Yeah. I have to address that because I couldn’t do any of this without the team we developed in Holland & Knight.

Jon Powers:

Thank you.

Taite McDonald:

Is good to give kudos to the shout out to the team.

Jon Powers:

Thanks Taite.

Taite McDonald:

Thanks Jon.