Jon Powers:

Welcome back to Experts Only. I’m your host, Jon Powers. I’m the co-founder of Clean Capital and serve 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 get more episodes at clean capital com.

Jon Powers:

Roger Ballentine, thanks so much for joining us again here at Experts Only.

Roger Ballentine:

Thanks, Jon. Good to be here.

Jon Powers:

And for our listeners, there’s a previous podcast that I did with Roger, one of the first ones where Roger talks about his amazing experience in this space, helping to really form the conversation around climate over the last few decades. You can listen to that to get a better sense of Roger himself, but today we’re gonna talk about the report and the work that the report’s trying to affect. So, Roger, for a second, just to set the stage, you talk about the work you do at Green Strategies.

Roger Ballentine:

Yeah, so I guess we’ll start with kinda, you know, our theory, um, which, you know, we, I founded this firm in 2001, um, and, uh, with the, with the idea that, um, as much as we desperately needed impactful public policy to, to deal with the climate problem, um, progress was not being made there at a pace that was kinda okay for me. Um, so I, I looked around where else can I have an impact? And, um, what, what I kinda saw coming was beginning to see back then, and, and now I think it’s kinda been more or less proven, is that if we could align the efficiencies, the capital, um, the motivations of private sector actors to pursue business strategies, uh, that are consistent with or helpful toward decarbonization and addressing, um, broader environmental challenges, um, that we actually could tap into an, an, an, an entirely additional force beyond the government to drive positive change.

Now, um, that theory, which we call climate capitalism, uh, I think has been born out to a certain extent. Certainly, you know, fits and fits and starts. But I think it’s fair to say today, whether you’re talking about climate or sustainability more broadly, and I’ll, I’ll, I’ll one could say E S G, but that’s just gotten kinda bit of a hairy term lately. So I don’t even even need to go there. But, so just think about sustainability. Bottom line point is, is that for a company to really maximize its competitive advantage, be more profitable, attract the most talent, uh, drive the most innovation, I don’t care what sector company could be retail, could be industrial, financial, it doesn’t matter. Yeah. Uh, we’re companies across the sector that if you incorporate these major trends around climate change sustainability, particularly with the, um, shifting of the center of power of, of consumers and, and shareholders and, uh, uh, towards, you know, millennials and then Gen Zs, if you’re trying to run your company in a way that is inconsistent with and seen as opposing to these trends towards decarbonization and, and would apply to social equity and other things, which we, which we just don’t happen, really focus on, focus on the environmental side, but that’s not a smart way to, to run your business, attract talent.

Right. And, and I think that’s really kind become true. So what, what what we help companies and financial institutions, uh, and companies of all sizes and sectors, um, do is, is how to, how to optimize their strategies and then their execution against those strategies in ways that are simultaneously creating business value, but also, uh, environmental benefits in general and decarbonization impacts, uh, in particular.

Jon Powers:

Yeah. I mean the evolution of this space, like since you started Green Strategies in 2001, right? People weren’t even thinking about this for their, just buying their power from the utilities at the time. Yeah. You know, that first decade there was some development of strategies. The last decade has been a, you know, not to use the overly used hockey stick term, but now major buyers are, have their own electricity or how, uh, you know, energy procurement shops and the, the, they, they’re, yeah, the chief sustainability role is a serious role. Not a lot of corporations, like the dynamic changes has been significant. And what’s interesting to me about the report, which I can see here is, you know, really you guys are arguing about how to now take this to the next level, right?

Roger Ballentine:

That’s

Jon Powers:

Exactly right. The playing field set, the market’s mature, you know, this is, the data has been, uh, is out there long enough that we can understand it, and how do we take this to the next level. So as we get into that, you know, you guys worked with, uh, an organization, the Clean Air Task Force to put this together and partners at the Northbridge Group. What, what brought together this sort of cohort to put this report together?

Roger Ballentine:

Yeah. In, in interesting, uh, the origin story here, which goes back five years, um, uh, Armen Cohen, who’s the founder of the Premier task force, and just one of the more, one of the smarter, uh, and, and I think, um, pragmatic NGO leaders, uh, out there, um, he and and I had both been following very closely the growing and now really predominant body of literature, um, that says if get to a zero carbon electricity sector, uh, on a timeline, you know, even close to what science filter we need to do that the focus needs to be on both, uh, intermittent or variable, uh, renewable energy like wind and solar, but also on what we call firm and dispatchable, um, sources, uh, uh, that are also zero carbon. So the reason being that, and, and the, the theory being, which sounds simple, but we weren’t really following this basic principle, which is a zero carbon grid means a grid that is zero carbon in all places at all times, right?

Uh, and we’re not building one in solar in all places, and wind and solar does not generate at all times. So it’s fairly simple proposition, but one that, you know, as we’ll as we’ll talk about, um, uh, it was actually is actually quite contrary to the system that’s been set up presumably to encourage decarbonization and electricity sector for the past 15 or, or or 20 years. So Arman, you know, came to me and said, you know, I’m out there, you know, testifying before state legislatures and pushing for, at the federal level for a clean energy standard as opposed to renewable energy standard, where we, you know, have these policies that, that encourage or, or, or mandate the full sweep, uh, of clean generation, be it wind, solar, hydropower, geothermal, biomass, nuclear, uh, fossil carbon capture, whatever it is. So that’s, that was his really kind of policy focused.

And then he came to me and said, you know, you’re, you work in this private sector stuff and you know, I’m out here kinda trying to convince policy makers that we need to have a different approach. And meanwhile, all these big buyers, the Googles and the Walmarts and the Facebooks and all, and all these guys, um, all they’re doing is buying wind and solar, right? So don’t we need to bring that kind of same message to that side of the equation, which he said is not my world, it’s yours. Um, and really looked at how we take what’s been happening in the private sector, which over the past 15 years has been quite impactful. And roughly, you know, roughly a third of the wind and solar that’s been deployed in the United States in the last 15 years happened because of private buyer demand, right? Um, and so it was very effective, uh, in adding that capacity. Um, so how do we then, you know, Armon said to me, how do we then kind of bring a new approach as I’m trying to do on the policy side to the private sector side? And that was the origin of this. Uh, and that’s how the project got started.

Jon Powers:

Excellent. So, um, you know, I wanna get into the corporate demand side cuz as you said, it, it’s really, it’s been a major driver and especially when, you know, we were in the, um, uh, last, the previous four years of administration when climate wasn’t a national conversation at all. Uh, it was that demand that was continued to drive change at the state level and move things forward. You know, one of the things you guys talk about is that the, the pace of electrical se the electric sectors, it’s decarbonization is well behind the pace we need to achieve, uh, zero carbon. And, you know, how does you, you sort of laid out how this paper looks to address it. Um, it seems like the corporate role in that is gonna be, uh, more and more important over time. Uh, I think some of the federal policies are coming in place now, of course, of the ira, the state policies have come in place, um, you know, over the course of the time and will continue to emerge. But one of the things you guys really dive into, which I think folks may have a good sense of but don’t really understand, is the greenhouse gas protocol and the role that plays in helping corporations understand how to procure and hit their goals, right?

Roger Ballentine:

Yes. So for

Jon Powers:

Folks,

Roger Ballentine:

Yeah. Can you,

Jon Powers:

Can you just walk through a little bit of like, honestly, greenhouse Gas Protocol 1 0 1, like how is it established, you know, what’s the difference between one two and 3D emissions for folks?

Roger Ballentine:

Yeah. So, you know, 20 plus more than two decades ago, um, world Resources Institute, the World Business Council on Sustainable Development, you know, and others came up with this idea, which was brilliant, which is why don’t we develop a voluntary system of consistent rules by which, in this case we’re talking about companies. I mean the, the protocol applies to government. We’re talking about companies, um, that tells a company how to calculate their carbon footprint. And the theory was that maybe companies will actually start doing it. Uh, and it worked and we saw kind of a nonlinear, you know, increase in, in companies kind of voluntarily then creating what we call inventories, which is their carbon footprint, calculating their carbon carbon footprint. And just, you know, what I love about the, the power of the private sector is, you know, and this is kinda the theory of, of, of climbing capitalism, is that the power of competition is really, really strong.

And if now companies are competing like, well wait a second, target says Walmart is publishing this carbon footprint, well that probably means we need to do it, you know, and then Cole says, wait, I dunno if this is the right order. Right? Right. And you kinda get, you kinda get this, this, this race to the top. And that’s very, very powerful. Uh, so, so what, how, what are company’s, uh, mission? So roughly missions are kind of put into three categories. Scope one, scope two, and scope three scope. Scope one are just the direct emissions from things that the company owns. Ok. So if you’ve got a boiler in one of your buildings that you own and you know, a little smoke stack up top, the carbon dioxide coming outta the smokestack, that’s your scope one emission, you own it. Or if you’re a company, your corporate jet, which you own, right?

Emissions from those are scope one emissions, ok. Scope two emissions, which is what we’re really talking about today, are the missions associated with the energy that you buy, right? And this would apply to a household, right? The powers household, um, buys electricity from your local utility and there’s no smoke stack on your house, but there is one from the natural gas plant, or you know, God forbid the coal plant or whatever it is down the road or 200 miles away, that’s generating that electricity that’s coming to you. So the portion that you consume, you can trace back to the source and that portion of those emissions at the source, that’s your scope to it,

Jon Powers:

Right? So let’s play this example object cause it is so important to the report. So then we as a family buy community buy into a community solar project. Yep. Right? So the community solar project, so that, that affects our scope two emissions. We’re able to claim less carbon provided within our Scope two household, uh, because we’re willing to do that. And a company could do the same thing. They could buy solar that doesn’t have to be set on the rooftops. Um, they can buy it from another facility and then offset their scope two.

Roger Ballentine:

So that’s essentially, right. So let’s go back to company for a second. And I wanna add another layer to this, which is then what happened after the greenhouse gas protocol, which is kinda the rule book, ok? It’s the rule book, but again, it doesn’t require anybody to do anything. Just as if you’re gonna calculate your carbon footprint. Follow these rules. What then built up, uh, beyond that or what we call the kinda, we talk about the rules and rewards ecosystem that governs corporate decision making around buying energy, buying electricity, right? The rules of protocol, the rewards ecosystem are the kind of third party leadership recognition programs where companies get kinda ranked and get a score. There’s the carbon exposure project, c D p, which awards companies, you know, bonus points for how much did you reduce your scope to here, there’s something called the science-based target initiative, right?

Which is becoming wildly popular. And companies are all signing up to follow set of rules that says, okay, we’re going to set a target for reducing our footprint. That’s consistent with the, the science. What science tells us to decarbonization timeline for the whole economy means. So each company then develops this strategy, uh, that the, the S B T I then either says, yep, that’s good or it’s not. You gotta do a little more here or there or otherwise. And that then becomes a major driver of their behavior going forward. It’s like, well, we gotta meet our target and we gotta meet our target. Cause we want to be recognized as having a target meeting a target. And um, and we’re going to do that by using the rules that allow us to calculate what our footprint is and the reductions that we make so we can then say, look, we did it and we get the credit for that.

And now by the way, this, this is becoming even more critical to companies as the whole e s g investor world as imperfect and as it is, there’s more and more investors who are asking questions like, tell us about how you’re addressing your carbon footprint. Show us the results. Right? So this is all becoming quite a big deal, uh, for companies. But this then brings us back to kind of the origin story of this project. So we looked at that and said, okay, this is really good news. And the more and more of these buyers, big companies and now smaller companies and just the, the, the, the economic power behind these electricity buyers grows, uh, constantly. And now they’re actually trying to do something, uh, for decarbonization of their scope too, but they’re following these rules. So then we took a hard look at the rules,

Jon Powers:

Right?

Roger Ballentine:

And said, are they optimized to actually drive carbon emission reductions? And what we found is that they’re not, lemme me without getting too geeky, it, it goes to,

Jon Powers:

You get a little geeky. This is really important cause this is like the report cards out there. It’s not having the, having a good effect, but not the optimization effect that we want.

Roger Ballentine:

Correct?

Jon Powers:

So, so how do we, how do we maximize,

Roger Ballentine:

Right? So, um, the key to all this was the development of what we call renewable energy credits or recs,

Jon Powers:

Right?

Roger Ballentine:

Which originally were, were, were certific, they’re certificates. Um, you can just think of pieces of paper, okay? That, um, represent or show that there was a megawatt hour, which is a lot of, you know, big production of energy over a one hour period that had zero emissions, largely because it came from wind or solar project. And for projects produce, um, uh, zero carbon energy, it produces a wreck. Now, originally this was used in kinda state laws that required utilities or or electric retailers to have a certain percentage of their electricity be renewable. How did they prove that at the end of the year that they met their percentage, they can go to the state and say, we complied. They come in with a stack of recs, right? It meets that amount. Okay? Now when we talk about the private sector demand, we have what we call voluntary market recs, not Rex that are used for these compliance programs, largely the state level.

But for a private buyer to say, look, I used, I consumed a megawatt hour of clean energy. Well how do you, how, how, how are you showing me you did that? I got this wreck. Okay. Right? And the way scope two, the scope two rules are written is, let’s just imagine you, you you, you have a company in, in one location. You’ve got one facility in one location, um, and whatever the mix of clean and dirty generation that’s servicing your facility, those are the emissions associated you, you determine the emissions associated with your electricity use by saying how much electricity did you pull from that grid region and how dirty was that grid region? And then you just kind of multiply what we call the emissions factor of that energy you were using by the total amount that you used. And you come up with a number, here’s, here’s the green, here are the greenhouse gas emissions associated with our electricity.

Ok. That’s how you would do, put aside Rex for a second. That’s how you would calculate your scope two. Now what scope two accounting allows you to do is you take that number of just the actual emissions associated with what you’re actually pulling off the grid and you can start subtracting emissions from that inventory equal to each wreck that you, so if you have megawatt hour, if you have a wreck, which is megawatt hour of zero carbon generation and in your actual footprint, let’s say you’ve got megawatt hour of coal use, right? You can erase that coal use. Yeah. And now your scope two starts going down. Okay? Now, when this system was originally conceived and when the protocol was developed, the corporate protocol was developed, the intention really was to build more wind and solar capacity to get more build, drive down the costs. And back in the early days when there wasn’t a lot of wind and solar, virtually every new wind and solar plant had a really beneficial impact on the grid. Cause once that starts generating by and large, it was backing out dirty generation,

Jon Powers:

Right?

Roger Ballentine:

So this brought the power of the private sector to get a lot more renewable energy built. That was good.

Jon Powers:

Yep. By the way. And those recs became a financial tool to help finance these projects. Hundred percent. Any level. Yeah.

Roger Ballentine:

Well, and that’s how it, you know, that’s how it works. So how can I get this project built? Cause back then, particularly when its solar, were relatively expensive. But now the project developer gets to sell the electricity and sell them reps. They have these two income streams. And that helped to get a lot of projects built. It worked right? Spectacularly. What we then looked at however, is, and our view, again, given how you teed this up in the beginning, which is we are not on pace to carbonize electricity sector nearly fast enough, right? Right. So we start asking the questions, okay, are we really incentivizing the right thing? So lemme give you an example. Um, today I can have a company, just imagine a company that’s hooked up directly to a coal plant and they go buy Rex. And let’s say they’re in Ohio. Ok?

Then they go buy Rex from a new this today a new wind farm in West Texas that produces a lot of Rex. It’s a great place to build wind. It’s a lot of wind out there, right? And they get all these Rex and even though their actual electricity use has not changed one width, they’re still hooked up with the coal plant, right? They get to erase all those emissions. Now why is that a problem? Well, in this case it’s particularly a problem, but it, it’s a problem for two reasons. One, and kind of thes of it because companies are in that situation, that company, let’s say it got enough wrecks from that wind farm to offset all of its load from that coal plant. They’re allowed to say under the Federal Trade Commission guidelines that they’re using hundred percent renewable. Well, of course they’re not.

Jon Powers:

Right?

Roger Ballentine:

But the other problem then that um, is, is become more and more exacerbated in those more and more wind solar being built, is that that new wind farm in West Texas actually has very little climate benefit. Because if anything it’s being curtailed mean, there’s just too much wind all at one time. So it’s not even being used. And to the extent it’s place displacing something, it’s probably displacing other wind or maybe some solar. So the, the actual climate benefit, the emissions actually avoided can be relatively small. So now, so our theory is, okay, actually what really need today are not capacity builders as much as emissions reducers. But the way we, the way we use recs and the way we do scope two accounting, there is no one even asks the question of whether those wrecks resulted in anything good for the climate. We don’t even ask the question. And it’s not required. You’re allowed to just assume and reduce. And what that does is it, it allows companies to kind hit their even a hundred percent renewable goal. You know, I can’t imagine a situation where a company hits a 100% renewable energy goal through some through this system and doesn’t have some positive impact,

Jon Powers:

Right?

Roger Ballentine:

But it’s grossly overstated. So what we positive, and we’re

Jon Powers:

Not optimizing the system when it comes to

Roger Ballentine:

It, we’re Notre noting, and by the way, by this focus on Rex, which are have overwhelmingly been from wind and solar, we’re doing nothing to address the problem I talked about in the beginning, which is we have to build, even if it means new technologies coming to market, zero emission firm and dispatchable generation. So we get to that goal of zero carbon energy in all places and at all times. So the current system was disconnected from what the overwhelming body of literature tells us we need to do to decarbonize. And by the way, it’s a little bit misleading. And by the way, we’re not incentivizing companies themselves to ask the question. For example, uh, I’m gonna do, I’m gonna do a, a wreck a deal with some, it could be a new project, a new wind or solar project. And I’m looking at these two different projects. One’s in Texas, the one I just described, let’s say the other one’s in Kentucky. That one in Kentucky is actually gonna yield a lot more climate benefit cause it’s on a dirty grid. You put that new clean generation there, that’s actually gonna displace fossil generation. And from a

Jon Powers:

Truly offsetting

Roger Ballentine:

Climate perspective, yeah, that’s the one we want the company to buy from. But they have no incentive to do that. Or yeah, there’s, there’s nothing in how if they chose Kentucky as opposed to Texas, their Scope two inventory, their that scope two number they report would be the same.

Jon Powers:

Yep.

Roger Ballentine:

And we don’t, even when we say good job company through S B T R, these other recognition programs, those programs don’t ask, tell us about the emissions you actually avoided from your procurement, which is actually what we care about. But the question is not even asked.

Jon Powers:

So how does this report suggest we start to ask that question? And then how does that get, so folks that aren’t familiar, like there’s a process within W R I and the greenhouse gas protocol to get these new metrics developed. You know, how does that developed? And then just a third piece of it is we’re about to see a massive scale up because of the I infrastructure, uh, are the inflation reduction act in more and more projects coming line just the next two to three years. That process will take a while to happen. You know, how do we incentivize that change so that those projects coming online can really, uh, meet that, meet that required change?

Roger Ballentine:

Yeah. So, uh,

Jon Powers:

Lots of that question. Sorry, <laugh>

Roger Ballentine:

Yeah. Get, this could get really technical, but I’ll, I’ll just try to, because we think at, at, at the highest level it’s just, it’s pretty simple and obvious, right? So, um, the, there’s nothing in the protocol today that says to a company in, in your, when you make decisions to buy clean energy, tell us what impact it had. Ok. Um, we think that needs to change. And so our entire theory is we need to start shifting to impact away from wreck accumulation. Yeah. But right now what’s rewarded is accumulating wrecks irrespective of their benefit to the climate. Uh, and let’s really shift the focus and again, the power of competition, uh, back towards actually focusing directly on reducing emissions. So yes, w r I will undertake a process to reconsider the scope two rules. And that’s actually getting underway. That process I was involved in the last time this happened eight, nine years ago. Very, very long process,

Jon Powers:

Not fast

Roger Ballentine:

Stakeholder consensus approach. Uh, and it worries me, frankly. Yeah. But, you know, we’ve laid out a, you know, set of recommendations on how the protocol could be, um, uh, improved. And let’s give you one example. We say, for example, when you’re putting your Scope two inventory together, you can’t use a rec from a project that’s not on your grid. So it has to be, if it’s from your regional grid, and again, because the way electrons, you know, work, you can’t trace from a one generation right to your meter. But at least in that case, you know that this procurement that the company did that helped bring new clean energy online was on their regional grid and has a positive impact on, on, on the electricity system where they are using, where they are using electricity, they’re low, right? And therefore the ability to say, look, this I’m using it gets a little bit better. We think it’s still not perfect, but better. And, and we have a whole bunch of other, um, um, disclosures that we think would be highly relevant. Uh, but the first set are how, how do you improve this kinda scope to wri accounting rules? But then we say we need a whole additional set of disclosures, which are in fact focused on impact questions about what emissions were avoided by the decisions that you made. And that either could be or does not have to be part of the greenhouse gas protocol. It could be separate,

Jon Powers:

Right?

Roger Ballentine:

Um, so yes, we’re, we’re pushing to see if we can kind of shift the protocol towards an impact approach. Um, but if that doesn’t work, it doesn’t have to be these programs, you know, A C D P or S B T I or these other programs that truly do impact, um, corporate decision making themselves could add these questions and requirements, right? The problem is that today those programs just by, you know, uh, just completely incorporate the greenhouses protocol so that they don’t do any additional kind of question or analysis or they just incorporate it. But we think they, there’s no reason they can’t change that.

Jon Powers:

Yeah, absolutely. So, I mean, having been in the room with you and Aspen, and without breaking Chatham House rules here for a second, this is not a academic process. This, the corporate procurers, a very large organizations are actively talking about this and looking for help to solve this cuz they want, you know, they’re driven by mission to do to do better, and they just don’t want that pure accounting mechanism to be what drives their decision. They want real optimization as well. That’s, that’s really exciting. One, one of the things that, you know, I mean, you know, the new legislation that’s come out, you know, for folks that aren’t, doesn’t really dive into things like scope one, scope two, scope three, right? It’s about tax incentives, it’s about great optimization, but, and what we’ll do is really enhance, uh, and, and, you know, put the rocket fuel we need to the market to continue to grow.

And those procures, as you said, are a third of the market for the offtake. Like their demand will help shift where we’re headed. Um, you know, do you see that really coming in for, you know, the developers that listen, right? That are thinking about where they’re putting their projects. You know, they, they should be thinking this is gonna something that might affect them in but 2025. Like, you know, when do we start to see that? And then how does, how do you guys think about affecting the, the, the base load of clean energy that’s out there today, right? Is this, do you grandfather those rocks in? Is it, how do you, how do you think about that?

Roger Ballentine:

Oh, a couple things. I mean, first, I I I, I really need to say that, um, the comp the companies, they’re just following the rules they were given,

Jon Powers:

Right?

Roger Ballentine:

You know, they’re not, they’re not saying, oh, let’s do this. You know, let’s get these bogus wrecks from Texas, then we can fool the world into. They’re not doing, it’s just, it’s the rule. Those are cheaper.

Jon Powers:

It’s like doing an audit. They gotta file the rules,

Roger Ballentine:

The same points, reward points, uh, and so they’re following rules. Um, now there are companies that are already going above and beyond and doing what we say they should be doing. So a number of examples, Facebook is doing this. Uh, Salesforce is doing this, you know, going and actually looking to locations to develop projects that’ll have the most impact, but a, they’re the exception, not the rule. And B, it’s because they’ve already hit all the gold stars with a hundred percent renewable, right? That, that, you know, they can do that, but the vast majority of other companies are still kind of climbing up the mountain according to those following the pathway they were given. Um, so it’s a suboptimized a suboptimized system. Um, so what’s the, you know, what’s, what’s kind of the next, if we start really looking at impact, um, and we start looking at, again, at the risk of getting a little bit too geeky here in our proposed kinda recognition system, we asked companies to disclose a whole bunch of, of, of different things. One of which is the ex, the extent to which, um, if they made some investment or did some procurement for firm and dispatchable zero carbon power, we think they should get a little extra credit,

Jon Powers:

Right?

Roger Ballentine:

For that. And, you know, what is that aimed at? It’s certainly aimed at how do we bring some new technologies to the market, modular nuclear plant or, you know, a new zero emission natural gas plant or, you know, something, something like that. Great. Um,

Jon Powers:

Even a microgrid, like an actual incentivizing a microgrid, which is not, is very not incentivized right now. I mean, you can do storage, you can still, there’s zero incentive to really do a microgrid

Roger Ballentine:

Well, and, and before, and you know, back to basics here, you know, the one thing is really is entirely consistent with what we would call higher impact, what we call next generation procurement includes just putting solar panels on your roof.

Jon Powers:

Right.

Roger Ballentine:

You know, as opposed to, you know, buying ’em from the other side of the buying res, the other side of the country, you know, put the solar on on your facility. So, you know, that’s almost, you know, old school technology at this point. Um, but, but that matters too. But look at, you know, what’s the interchange with policy here? So yes, had the inflation reduction act not passed, then you, we would kind be the only game in town, right? Little of overstatement. But, um, and I’m glad we’re not, yeah. You know, we being those who are focusing on maximizing the, the rural product sector, but I, I don’t think anyone should feel like, well now we’ve passed the IRA and let’s just, you know, fat city, let’s just relax and everything’s gonna be fine. Um, no, uh,

Jon Powers:

Right. It doesn’t, that it doesn’t truly optimize the grit. I mean, the IRA’s about in improving things and, but, but what you’re driving here is true optimization. Like how do you really maximize?

Roger Ballentine:

And there are other, there’s other policies and frankly, Jon, I don’t even know if this is part of, not part of ira, but it’s part of the infrastructure bill. I, I’m not sure, but, you know, an article today in, in about a, a nuclear plant in Michigan that was about to be shut down, uh, and there’s now federal money under the nuclear extension, whatever program that the, the utility that was gonna shut that down sold it to another developer who, with that federal money gonna kinda restart it and recommission it and, and get it going again. And that, and that’s megawatts of dispatchable zero emission power. Right? Right. Really, really important. Now, what we had been talking about, talk about it, but would there be a role there for the private sector if, for example, like today in the private markets, you know, if I generate a megawatt hour from a wind farm, I’ve got that wreck which has value, which I can sell to somebody. But if I generate a megawatt hour of nuclear, I don’t have that piece of paper, I don’t have that additional income stream that I can sell to a company. Well, we think that needs to change. And then, then maybe we’ll start seeing some additional revenues coming in to, um, other zero emission sources that frankly might need it. Right. You know, we can get into a debate. I’m not gonna get into debate about whether nuclear’s part of the solution or not. Cause it’s, and I’m not, I’m not waste time. I want

Jon Powers:

Debate on that.

Roger Ballentine:

But there is the question of do that, does nuclear really need the extra money? Um, and you know, to me it’s like, I, I could make the argument today, and you hear, you do hear this criticism, I don’t entirely buy it, but from the right, a wind and in particular, that’s a mature industry. Why do they need tax credits? Why do they need all this other stuff? You know, that’s a mature industry. Mature, not mature, I don’t care. The fact is that zero emission power provides good goods and value beyond what’s compensated in the market because we don’t price carbon and climate change the greatest market failure in history of mankind. So I don’t get too hung up on that. I think anybody who’s producing power zero emission deserves an extra payment. But it just so happens that the value of a megawatt hour of zero carbon energy that you can control as to when it generates, provides system value above and beyond the value of a wind or solar megawatt hour, which kinda happens when the wind’s blowing or the sun’s shining.

Jon Powers:

Right. Well, listen, Roger, thank you, first of all for the thought, continued thought leadership on this. And you know, it’s this type of work that’s setting the stage for companies like Clean Capital and others to be able to Sure. You know, finance and own these projects long term and, and really driving the conversation. Uh, but the corporate procurers, which will continue to, I think help move us forward in a, you know, regardless of the winds of change in Washington, like there, those, the, the corporate world continues to drive steady here. I think that’s super exciting for all of us.

Roger Ballentine:

Well, I, I, uh, remain optimistic to fight everything. And part of that’s, cause I know there’s, uh, folks like you out there who are, uh, actually moving money around and doing good stuff. So

Jon Powers:

We’re trying, we’re

Roger Ballentine:

Trying. Thank you. Thank you for what you do.

Jon Powers:

Yeah, thank you. And thanks for, for, for joining us today and experts only. And for folks that are interested, you know, both the Green Strategies website and the Clean Air Task Force, you can get modernizing how electricity buyers account and are recognized for decarbonization impact in climate leadership. Lengthy, but very important or title, but very important report, <laugh> to make a, we

Roger Ballentine:

Do have an executive summary if you can. Thank you. Yeah.

Jon Powers:

Got raise. Thank you.

Roger Ballentine:

Jon.

Jon Powers:

Roger, thank you so much for joining us. Thank you to Colleen Young and your team at Green Strategies. We’re helping to put this together. As always, you can get more episodes@cleancapital.com. Thanks.

Roger Ballentine:

Appreciate it.