Voiceover: Welcome to the Experts Only podcast, sponsored by CleanCapital, where we explore the intersection of energy, innovation and finance. Our host is Clean Capital’s co-founder and former Federal Chief Sustainability Officer, Jon Powers. Learn how CleanCapital is revolutionizing clean energy finance, and find more episodes@cleancapital.com, iTunes or wherever you get your podcasts. If you like what you hear, be sure to subscribe and leave us a five star review. Jon Powers: Welcome, and thank you so much for joining us for today’s episode. We’re going to be talking to Roger Ballentine, the President of Green Strategies and diving into how the private sector can help solve the problems of climate change, how it’s helping to drive innovation and economic growth. The project’s got an amazing career in the space. You’re going to hear some really interesting parts of the conversation when he talks about how sustainability can be viewed as a night vision goggles for companies who’re looking to drive vision throughout their operations. On an admin note, we had some technical challenges on our connection, so it’s us not you, but please bear through those because it’s a very interesting conversation. Thank you. Jon Powers: Roger, thanks so much for joining us here at Experts Only podcast. You’ve had quite a career and a journey throughout the sustainability space and clean energy, across finance, across policy working with corporate America. You’ve worked in the Clinton White House, with corporate giants like Walmart, working with advocacy campaigns, helping to found American Council on Renewable Energy. It’s a pretty amazing career you’ve had. Can you talk a little bit, for our, audience just about your personal journey in that space and how you even ended up working in this space to begin with? Roger Ballentine: Well, first, Jon, thank you very much for the opportunity to chat with you. I appreciate it very much. And all you said is true, although I was just, I think, a long way of pointing out that I ain’t that young anymore. Well, look, I’ll give you the- Jon Powers: Seasoned. We call it seasoned, rather. Roger Ballentine: Seasoned. Yes, seasoned. Honestly, I think two main forces I think propelled me in this direction, somewhat unintentionally, but my whole life I’ve been a pretty avid conservationist, outdoors man, environmentalist. These are the issues that were always personally of very high value and priority to me. Interestingly, for the first decade or so of my career after law school, I really didn’t get involved in those issues for a whole host of reasons, because at that time when I was a young man, my other passion in life was politics. And I came to Washington less interested in the law and more interested in politics and led me to do a lot of both for a number of years, developed some skills and then found myself working at the White House for Bill Clinton. My first job there was in Legislative Affairs and it just so happened, to my great delight, that the entire Energy and Environmental portfolio of the administration needed someone to own that in Legislative Affairs and that was me. Jon Powers: Oh, that’s interesting. Roger Ballentine: So I spent my time doing that for about the first year that I was there, and one of the issues that was coming into the fore at that time was climate change. The President had recently created what was called The White House Climate Change Task Force, which really was a group of about 20 senior folks from around the government, detailed over to the White House to work, then, on implementation of the Kyoto Protocol primarily, but more broadly the climate issue, and the person who was running that at the time, Todd. And I began working with Todd. We became very close and I became very, very involved in The Climate Change Task Force. And then, again, after about a year that I had been at the White House, Todd decided he was going to leave. He recommended me to the President and the Chief of Staff to take that job, which I did, and then so became Chairman of the Task Force and spent my remaining two and a half years or so of the administration in that role. That role- Jon Powers: Did you come off a campaign when you came into the White House or were you…? Roger Ballentine: No, no. I was a partner at a very politically connected law firm in Washington. I had been advising and working for the Democratic National Committee for a number of years and I had worked on and off a number of campaigns. I did work on the ’96 Presidential Campaign, on the reelection. So yes, I had done that, but really, my full-time job for all that time was previously at the law firm. Jon Powers: Right, right, right. Roger Ballentine: So just to go back to the white house, my role there was multifaceted. I reported directly to the President and to the Chief of Staff. My mandate was anything that touched on climate, which energy, land policy, but mostly energy. And the President had a very, very strong interest, both in climate and in energy innovation, in general. So he was really driven by that. He pushed me hard to push everyone else very hard on that. And in terms of my external facing work, I really had two constituencies. One was the environmental community and then it was the business community that I was working with and it was that experience that led me to decide what I wanted to do after I left the White House. Jon Powers: What a unique time to be working on these issues, too, when things were just really starting to ramp up. I want to talk a little bit about what you’ve seen across that seasoned experience as we mentioned earlier, but if you could look back to the time when you were in there, if you could change one thing or try to push one thing harder or more even, is there a specific issue that you were driving that you’re incredibly proud of having got over the goal one? Roger Ballentine: Well, I’ll tell you. Back then, the controversy over climate change and some of our strongest opponents to really proceeding with any action on climate change were both Republicans and Democrats. In fact, some of our strongest critics and opponents to action were Democrats. So it was very difficult and very different time than today. I guess what I wish we had been able to do more is to deploy the President himself more to talk about the climate change issue, because when he talked about it, and this is all second nature today, but I will tell you, Bill Clinton was the first and the strongest to articulate in an incredibly powerful way that A, this is a moral obligation and an enormous challenge, but it is also the single greatest opportunity we face as a country, as a people to innovate and create wealth while addressing this problem. He called it, “This is my big idea”, which, again, today everyone says it. Not everyone was saying it in 1999. Bill Clinton articulated it beautifully and when he did, he was so convincing that I wish I was able to push to get more time for him to talk more about that issue, particularly to Democrats, but to deescalate what became the narrative around if you want to do climate change, you must sacrifice the economy, because Bill Clinton was way ahead of that argument early on and I wish we had done more there. Jon Powers: Yeah. That position is coming into reality today. Actually, on a previous episode, we just talked with the head of AWIA and I think one of the interesting things that he talked about in the wind space is people have always talked, for the last few years, about jobs and clean energy. And he said let’s stop talking about his jobs and let’s start talking about his careers. When you take a wind turbine technician in Iowa, these systems are in place for 20 years. They’re going to be working on these things for a long time. Really, I think, an interesting way to think about it. So some of your post administration experience, you’ve founded Green Strategies. Can you talk a little bit about what Green Strategies does and some of the efforts that you work on? Roger Ballentine: Back to when I was contemplating, well, I wasn’t contemplating leaving, the Constitution required me to leave, the administration, I thought about what I wanted to do and what I knew was that I wanted to continue to work on climate and energy, environmental issues more broadly. There was no question about that, but then the question was, how did I want to do it? I didn’t want to go back to a law firm because then you’re taking clients that come in the door and you may not always be on the side that makes you feel best and making the most progress, so I ruled that out immediately. Now, there’s a consideration of looking to go and work on the NGO side. I also quickly decided against that because what I was seeing in that part of my job at the White House interfacing with the private sector, which, yes, included a lot of industries coming in, telling us that we were trying to destroy the country. Roger Ballentine: But a lot of other companies that came in and said, “You know what? We’ve got ideas, we’ve got innovation, we’ve got products. We have approaches. We’re thinking new about this.” This was a time which was unprecedented at the time. DuPont, under Chad Holiday, in, I think, ’99, maybe 2000, announced that the company would cut its greenhouse gas emissions by 60%. Jon Powers: Wow! Roger Ballentine: Absolutely stunning. And I met with Chad and heard what DuPont was doing and I just became enamored with the idea that the private sector, if motivated, could bring the same power effectiveness to solving this problem, that frankly, the private sector had a big role over the last century in creating the problem. So what I was really interested in, and this was not divorced from policy, it’s related to policy and we can come back to that, but my view was that I think where I could be most effective is I could help work with the private sector and private companies to help them succeed by doing well by the environment, by finding low emission solutions, by becoming more efficient, by out-competing their competition through, to turn to phrase, green strategies. Roger Ballentine: So if you ask, what do we do here? We help our clients make more money, out-compete their competitors by doing better from an environmental perspective. It’s that alignment because I firmly believe that that is how we’re going to solve this problem. Yes, we need policy. Yes, we need a lot of other things, but if we’re going to solve this problem, we need capital flowing to solutions, not capital flowing to continuations of the problem. We need money spent in the private sector because they see this as an opportunity to innovate and compete. So they’re going to put their money into smart people trying to solve problems instead of putting their money into lawyers and lobbyists trying to hold back the inevitable and protect the past. That’s what I’m interested in. That’s what we do at Green Strategies and now been doing it for 16 years. Jon Powers: So over those 16 years, there’s been significant market changes in this space. I think there’s been ebb and flows to the clean tech venture capital world. There’s been growth in the adoption of renewable to significant growth just in the last seven to eight years with the hockey sticks in wind and solar. You’ve got microgrids. You have challenges around utility policy across the whole spectrum. So reflect a little bit on that market growth of the last 16 years and how do you then advise major fortune 50s and 100s and others to engage that space, when so many could look at it and just be intimidated and say, “Look, I’ll just pay my utility bill and go on the way”? Roger Ballentine: It’s really a great question because the answers are complicated. If you look back at the early 2000s, and I was involved in a lot of this when Silicon Valley started really getting excited about clean tech and clean energy, that was a time where we were advising folks that this is going to absolutely take off. You need to figure out how to be on the right side, get a seat on this rocket ship. That was the general narrative was and I was part of some of that. When I went out and met with and talked to a lot of the Silicon Valley guys, I came away with the realization that these guys really knew technology. They really knew how to build a company, but they don’t understand and don’t care about policy and they really don’t understand the energy sector. In my view, either one of those things would’ve been fail. Roger Ballentine: They both turned out to be quite significant in holding back what originally was thought of as a clean tech boom that really fizzled out, but having said that, so then at that point you could have said, “wow, okay. This clean thing is not real and we’re just going to go back to the way we’re doing things.” Well, no. That is not what came out of it. It was just a shift and the shift we saw was a lot more to continued development of technology, but also finding better ways to understand and incorporate a lot of existing technology and practices, some of this driven by policy, but companies really, for the first time, for a host of reasons, started looking at themselves, their operations and eventually their products and their supply chain through a lens they had not previously used, and that’s the lens of sustainability. Roger Ballentine: And what they found was looking through that lens. I refer to corporate sustainability as night vision goggles. All of a sudden, you’re looking at your business, you’re looking and you’re seeing things you couldn’t see before. And a lot of it was finding simple efficiency, simple cost savings because now you were looking for them in a way you weren’t looking for them previously. So companies like Walmart, who I’ve done a heck of a lot of work for, their ability to drive out emissions and drive out energy spend, which is the same as driving out emissions, by just looking at very basic efficiency measures. We didn’t need some whiz bang Silicon Valley startup with a new app to do that. It was simply a new way to look at and measure a company. And there were a lot of metrics and ways to do this, but we start measuring sustainability, start measuring greenhouse gas emissions, which, nine times out of 10, are direct proxy for waste. Roger Ballentine: And you start looking at your company and your operations in that way, you find value that was there all the time, but you didn’t see it. And I’ll tell you a quick story. I took the Chief Sustainability Officer of Walmart into the White House once, this is now the Obama White House, to meet with one of the Chief Economists over there and the Walmart CSO described how we started looking and poking and blah, blah, blah. We saved $30 million in efficiency, upgrades and costs and all, and the economists looked at him and said, “What? That can’t be true because if those saving opportunities were there, you would’ve already done them.” And it’s just the classic economist view that there can’t been a $40 bill on the ground because someone would’ve already picked it up. Well, the fact is, particularly at that time, there was tremendous waste and inefficiencies across a whole bunch of companies and sectors because people looked at it through this lens which forces you to see things a little different way. Roger Ballentine: And particularly when you’re a company that sets goals around accessibility, whether it’s sufficient to your emission reductions or otherwise. A goal to meet, they got to figure out how to meet it and you do that by innovation, and along that way, a lot of times you start finding, hey, they get happier employees, but that innovation process ends up yielding a whole bunch of other benefits. So long answer to your short question was while the decade or so, after the Clinton presidency, was fits and starts in some way around clean energy. What really began then, which is driving so much value and change today, was companies began to take a look at themselves through a sustainability lens, adopting corporate sustainability as a business strategy, not a PR strategy, not a philanthropic exercise, but a business strategy. And to me, this is very satisfying because this is the culmination of why I got into this in the first place, which is how do we align what companies do well, which is drive down costs, produce good products, whatever it is that they do, to do that in the service of reducing emissions and becoming sustainable and addressing climate change and start these what has happened and continue to happen and I’m very excited about that. Jon Powers: That’s super interesting. By the way, I love the night vision goggle metaphor. The terminology of a lot of this has changed over time and continues to change, but where do you feel like sustainability really became grounded and helped, I think, really launch this approach that we’re seeing paying huge dividends today? Roger Ballentine: It’s hard to say. I’m biased, but I think as much of a watershed moment as anything else was the fall of 2005, when then CEO Lee Scott from Walmart announced their sustainability commitments. Previously, sure. There’d been some very green, socially conscious type of companies, but this was Walmart. This was a very conservative company based in Arkansas, almost notorious in the eyes of many on the left, stepping up and making, my view at that time, the strongest overall commitment to corporate sustainability to date. To me, that was a watershed moment. I’m sure there’s others, and again, I am biased, but I think that was a very, very big deal, both because of the type of company they were, and then, of course, because they’re everybody’s biggest customer and what they do and believe has a very strong ripple effect throughout other aspects of the economy. Jon Powers: Yeah. So when I was at the White House, I remember we utilized their sustainability plan, their practices on renewable energy. The President Obama called on us a lead by example from the federal government’s perspective, but we were following some other leadership in many cases and Walmart was part of it and we used that experience and the lessons learned that they had to share, pushing folks that would push back on us and say, “This is impossible.” Well, it’s not impossible. Look at what Walmart’s doing today. Yeah, Roger Ballentine: Yeah, yeah. Well, and then you all took it to a whole nother level, so. Jon Powers: So let’s transition a little bit. I think you recently wrote, and you hit on this a little earlier about the tripartite paradigm of technology, finance and policy and how remains the foundation of the clean energy sector. So I’m going to talk a little bit about that and then a little bit about how this influence is critical today in the technology, in the utility space, and how that is transforming. And really driving a question that many people are looking at today is, is the utility space ready for this transformation and what are they doing to get ready? So talk first, though, about that tripartite paradigm. You hit on it a little bit earlier. Roger Ballentine: Yeah. So first, to come back to the utility thing because the utility sector is very unique in my view and so I’ll talk about it. So this notion of the triangle, three legged stool or whatever you want to call it, I touched on it earlier in the sense that I think the California clean tech guys, didn’t get all the pieces. They got enamored by the technology. They were doing the financing and they figured that was enough. Well, it wasn’t. Then on the other side, you have people often making policy with very good intentions to try to further some clean energy goal and maybe they understand what the technology can do and might soon do. Very often, they do not understand what it takes to finance the deployment of a given technology or to finance the type of change that they’re trying to see occur. Roger Ballentine: So virtually anywhere in the energy sector, even beyond the clean technology sector, you’ve got to have a handle on each of those pieces. And I like to tell people when I speak to audiences about energy, I say, “Look, I’m not telling you this is a good thing, but I’m telling you that Washington matters or that policy matters.” Would the world be a better place if you didn’t have to worry about policy? Maybe, but that ain’t the world we live in. In the energy sector, policy matters. You got to take it into account in developing a business plan, deploying capital, assessing risk, creating opportunity. It’s part of what you need to understand and consider and you can’t deploy, you can’t grow, you can’t have impact if you can’t finance it. So you got to pay attention to that. And there’s technology, which, to my view, at least from a climate mitigation perspective, out of those three things is the least important. Roger Ballentine: And I don’t say that because I don’t think technology’s not great. It’s actually the opposite, which is, I think we have enough technology today to do a hell of a lot more to reduce emissions and create a more sustainable, efficient and prosperous economy than we are using. So I am all for continuing development of technology and coming up with even better this and better that. Absolutely. But what I often see is, particularly on the policy side, those who don’t want to see more policy saying, “Well, the real answer is just more technology so let’s just do some R and D and wait for that silver bullet to be invented.” That’s absolute nonsense because we are under deploying the technology we have today, which can reduce the emissions, address the climate problem, create economic growth and create jobs. So technology’s important, but don’t get hung up on it. That’s my message there. So on the utility space, look, I’m going to interpret your question as utility being actually a utility, which is a regulated monopoly government chartered entity in some particular part of the country. Jon Powers: By the way, that’s a great explanation for folks. We’re trying to educate folks in the space. We’ve had a lot of utility focused conversations here so I appreciate you laying out that definition. Roger Ballentine: Yeah, because an energy company and utility company are not the same thing. So we’re going to have to do a separate hour or so on this because I have a talk I give on utilities which runs about 45 minutes, but let me give you the punchline. The punchline is, are we seeing significant evolution, at least in terms of the energy mix across the utility sector, across the country? And the answer to that is yes. That’s a success story for wind, it’s a success story for solar, it’s a success story for energy efficiency and a lot of other things. So there’s very good news there. Now if you ask me, is the utility business model the most effective way to further the growth and deployment of clean energy? My answer would be, it could be, but it is not. So part of it is because, as I say all the time, we are in the most dynamic period of change in the energy industry, at least since 1978, probably farther back than that. Roger Ballentine: So we’re in the middle of a moving target. We are seeing an evolution from the traditional model of a single regulated utility who owns the generation, owns the transmission, owns a distribution, sends you a bill, reads your meter and that’s it. And the way they make money is by selling you electricity and the other way they make money is by spending money. They spend money to build poles and wires and power plants or whatever it is and then the state, the commission gives them a guaranteed rate of return on that and it’s a pretty good business. No risk whatsoever, no competition whatsoever. All you got to do is spend money to make money, which, by the way, is the opposite of what every other company would do. We’re reducing expenses and minimize costs is what you want to do. In the utility industry, is the opposite. Everything you learned in economics doesn’t apply. Roger Ballentine: So they’re not under that model. They traditionally have not, first of all, been incentivized to change that model in any way, certainly not incentivized to let anyone else come in to the sector to offer a differentiated product, clean energy or whatever it is, and they are really not incentivized to innovate because that way they make more money to spend more money doing mostly the most expensive solution, essentially, because the more money they spend, the more money they make. So that’s traditional. Is there’s still some of that out there? Yes there is, but that is an unsustainable practice in the age of changing technology, more options that consumers have, and particularly for companies that exist in multiple jurisdictions, once they get the taste in one jurisdiction to being able to, say, put solar panels on the roof of their building and sell some of that power back and to shop around for different retailers of energy, to get a better price and a better race charge once they start getting a taste of that. Roger Ballentine: And then they got another facility in jurisdiction that doesn’t allow that. You start seeing agitation for change. So we’re in the process of now seeing this leapfrogging change across the country, pushing for more optionalities driven by customers, more demand for clean energy. And again, none, this is at all in the interest of a traditional utility under the model I just described, but understanding that that paradigm is not sustainable in the long term, we’re seeing a number of utilities who are now saying, “Okay, we’re going to get into this game. We’re going to offer our customers alternatives.” What many of them are doing to do that, to avoid any threats, their monopoly and other places, we’re beginning to see competition, required competition, and allowing alternatives into the marketplace. Because again, in every other sector of the US economy, competition and market forces are seen as a good thing, just not in the electricity sector, but that’s now beginning to penetrate. Roger Ballentine: So that’s the transition we’re seeing and utilities, many are adapting. Some are fighting, some are doing both. The final chapter is not written here, but I think, by and large, we’re seeing significant change within a number of the major utilities towards reforming their business and they do need help from the policy side to do that because their regulators need to agree. And in some cases, the regulators are actually pushing them to change their business model. So I’m optimistic about where we’re going. It’s going to be a little bit bumpy here and there and again, it’s different in every state, but we are seeing, again, unprecedented pace of change in the utility sector. Jon Powers: Well, we have a whole nother hour on that in the future, Roger. I think that’s a great overview, so thank you. So we’ve one final question and we always ask this to our listeners and someone who’s had an incredible career in the space, someone who’s started off in law and politics and ended up driving sustainability across so many markets. If you could go back to yourself coming out of high school or coming out of college, what advice would you give yourself? Roger Ballentine: Well, drink less beer would probably be number one. Jon Powers: That wouldn’t be taken well. Roger Ballentine: Yeah, no, I wouldn’t have taken that advice. It would be to realize earlier than I did that the value of being able to get up in the morning and go do what you do for work, feeling like the more successful I am today, the better off blank is going to be, the world, the environment, whatever it is that you’re passionate about and care about, because I didn’t really think that way for a long time. And if you can ultimately get to that point where what you’re working on gives you that level of satisfaction to look for that. Another way to do it, and I talked to people who are now the age I was then and who come to me for career advice and ask, “What do you care about? What are you passionate about? What do you really, really care about?” And answer that question, then let’s start figuring out your career around that access. That’s the advice I would’ve given myself. Jon Powers: That’s great. Well, thank you, Roger. And thanks so much for the time today. Roger Ballentine: Hey, my pleasure. I really enjoyed it, Jon. Thank you so much. Jon Powers: Thanks for joining us here today at Experts Only podcast. Roger’s got an amazing career in this space and we really value that conversation. Also wanted a special thanks to our editors, Emily Connor and to Lauren Clickman for their hard work. This wouldn’t be possible without them. You can hear other podcasts from CleanCapitals Experts Only at cleancapital.com. Always looking for your insights and who we should have on so please send us your thoughts and we really look forward to continuing the conversation.