Episode 66: Joe Bonfiglio [av_image src=’https://cleancapital.com/wp-content/uploads/2019/03/podcast-image-pageheader2.jpg’ attachment=’4329′ attachment_size=’full’ align=’center’ styling=” hover=” link=” target=” caption=” font_size=” appearance=” overlay_opacity=’0.4′ overlay_color=’#000000′ overlay_text_color=’#ffffff’ copyright=” animation=’no-animation’ id=” custom_class=” av_uid=’av-jwwgyb48′ admin_preview_bg=”][/av_image] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwwgxszg’ admin_preview_bg=”] Episode 66: Joe Bonfiglio [/av_textblock] [av_hr class=’invisible’ height=’10’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwl4lsb2′ admin_preview_bg=”] This week’s guest is Joe Bonfiglio, President of EDF Action. EDF Action is the Environmental Defense Fund’s 501(c)4 sister organization, advocating to protect the environment and the health of American families. Under Bonfiglio’s leadership, EDF Action has successfully fought against budget cuts for the EPA and other agencies, lobbied against unqualified nominees for important protective roles, and launched a new campaign training program for political candidates. Host Jon Powers explores the role climate and the environment will play in the upcoming presidential election, both before and after the Covid-19 outbreak. [/av_textblock] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” font_color=” color=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” id=” custom_class=” av_uid=’av-jwwh5253′ admin_preview_bg=”] Listen now: [/av_textblock] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ id=” custom_class=” av_uid=’av-k4so2umi’ admin_preview_bg=”] [av_image src=’https://cleancapital.com/wp-content/uploads/2020/05/ExpertsOnly-Bonfiglio-bar.jpg’ attachment=’7516′ attachment_size=’full’ copyright=” caption=” styling=” align=’center’ font_size=” overlay_opacity=’0.4′ overlay_color=’#000000′ overlay_text_color=’#ffffff’ animation=’no-animation’ hover=” appearance=” link=’manually,https://link.chtbl.com/6Xr0g4Ym’ target=’_blank’ id=” custom_class=” av_element_hidden_in_editor=’0′ av_uid=’av-k37p0z0j’ admin_preview_bg=”][/av_image] [av_hr class=’invisible’ icon_select=’yes’ icon=’ue808′ font=’entypo-fontello’ position=’center’ shadow=’no-shadow’ height=’20’ custom_border=’av-border-thin’ custom_width=’50px’ custom_margin_top=’30px’ custom_margin_bottom=’30px’ custom_border_color=” custom_icon_color=” id=” custom_class=” av_uid=’av-jwwgzkyu’ admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwwh5253′ admin_preview_bg=”] Full Transcript: Jon Powers: Welcome to Experts Only podcast sponsored by CleanCapital. You can learn more at CleanCapitol.com. I’m your host Jon powers. Each week we explore the intersection of energy, innovation, and finance with leaders across the industry. Thank you so much for joining us. Jon Powers: Welcome back to Experts only podcast. I’m your host Jon Powers. Today we talk to Joe Bonfiglio from the Environmental Defense Fund C4 EDF Action. Joe got a vast amount of experience, both in policy and politics. And what we explore here is climate and the election here in 2020. Both before the COVID outbreak, and of course afterwards. So it’s a really interesting deep dive into the way that the current cultural movement around climate is affecting politics. As always, you can get more episodes at CleanCapital.com. I hope you enjoy the conversation. Jon Powers: Joe, thanks so much for joining us at Experts Only. Joe Bonfiglio: Hey, John. Good to be here. Jon Powers: So I want to step back and talk a little bit about you grew up in North Carolina, you ended up going to work on Capitol Hill. First of all, where in sort of growing up, did you get the bug that you wanted to end up in Washington and get involved with politics? Joe Bonfiglio: That’s funny, pretty early on. And I’m 40 now and it’s sort of like put the way back machine on, the economy was shifting to computers. And my mother was really fixated on me getting into computers. She thought that’d be exactly the right thing for me. I said, you know what? I think this politics thing is pretty cool. She, along with my family tried to talk me out of it. So we’re talking, high school 15, 16. Trying to sort of direct me out of this thing that nobody understood or nobody knew. The Bonfiglios have zero political background, not the family business by any stretch. So pretty early on, I thought this would be a sort of Jon Powers: What did your parents do? Joe Bonfiglio: My father is a jeweler and my mother was an administrative assistant. Joe Bonfiglio: So definitely not the family business. In fact, the family business would have been going to be a jeweler. But I really wanted to go and figure out how to make a difference, sort of the calling into public service. At least for me was government. And I really want to find the best possible path there. So through school, sort of just got my feet wet with the work and had interest in it, but then really had to figure out how to make it happen after. Jon Powers: And what was your entrance to the Hill? How did you decide, was it through communications? Was it a specific policy issue? What brought you into … And for folks that aren’t familiar with Washington, there’s a bunch of different sort of first day jobs you can get there. Jon Powers: Most of them are there sort of as a policy person, or if you’re really senior, a senior policy person or communications, right. There’s a variety of ways to touch or interning. What was your introduction? Joe Bonfiglio: That’s right. And I didn’t get any of them. In fact, I moved up to Washington D.C. Took the advice of move up there, get your resume out there and walk the Hill. I did that. I tried that and failed miserably. Moved up about 12 days before September 11th. And then spent about four months trying to get a job on Capitol Hill through September 11th, through the anthrax attacks on Capitol Hill. I like to joke, although it’s not a joke. I was trying to get the job opening congressional mail while someone was trying to kill the guy opening the mail. So I was not successful at all. Joe Bonfiglio: And it’s the part of the story that I tell when anyone sort of wants to break into the business. Like there’s no one path. I ended up going back from North Carolina hopped on a political campaign. Worked for free before eventually getting paid just a little bit of money that person won. And I ended up coming up to Washington D.C. with then Congressman Brad Miller. Jon Powers: Yeah, of course. Joe Bonfiglio: 2002. Jon Powers: Yeah. That’s interesting. How happy were your parents then when you had a job? Joe Bonfiglio: I mean, they still didn’t quite get it. I mean, and really we’ll sort of get to it later, but really until Trump won in 2016, then I think my mother finally say, I get it. It matters. But a family that was fundamentally not political voted, I think most of the time. But then it just sort of kind of crystallizes for people in different times. Joe Bonfiglio: And for her, it was very late. I had been in the gig for a while and in the game for a while. Jon Powers: No, I get it. My folks, my mom was a teacher. My dad had been at Sears and then Allstate for almost 40 years as an insurance salesman. And when I ran for Congress, it was like their first real political thing. Right. And matter of fact, I grew up Republican and didn’t know until I ran for Congress, that my dad became a Republican only so he could get a job in the town highway department because his dad had been the democratic chair in another County that I ended up running for. That’s how little politics we ever discussed at home. So it’s interesting. It took years for them to figure out what I do. I don’t think they still have any idea what I do. Jon Powers: My dad listens to this podcast but that’s about it. Joe Bonfiglio: Well, I mean, when you ran, did they jump in? Jon Powers: Yeah. My dad is like the most gregarious social person. My campaign manager pulled me aside at one point he’s like, I think I ran the wrong Powers. My dad was working the room talking to everybody. So yeah, they got super involved. My mom worked the phones. She was probably one of my most powerful messengers. Right. Just calling other mothers and I had just got back from Iraq. So, so yeah, let’s go back to you for a second. So you ended up on the Hill working for Brad Miller and then you sort of moved around the Hill to a couple of different roles. Where in that space, that sort of energy, environment, climate change, start to get into your vernacular. What sort of hatched that seat? Joe Bonfiglio: Yeah. I had spent a bit of time in the Senate, but really didn’t start until I popped back over to the house. I was chief of staff to a South Louisiana Democrat, a Cajun named Charlie Melancon. He was a sort of blue dog Democrat on the Energy and Commerce Committee. And this was 2009, 2010. Smack dab in the middle of both healthcare and cap and trade fight in Congress. And that was just such a interesting time to be doing the work. If you’re a political nerd and a policy geek in any way, that was just an amazing time to see really big things try to get done. Healthcare got over the finish line, cap and trade did not. And it was one of those unfinished business things that always sort of lingered with me. Joe Bonfiglio: And now we are so far from 2008, 2009, ’10, when that fight was. But to sort of watch the issue mature and just become so much more politically salient and over this last 10 years. It’s really been a sort of fun ride. I’m glad I got the bug, at least on the issue back then and I’m stuck with it. Jon Powers: Yeah. I mean, just reflecting, like we almost had a bipartisan Senate bill with Kerry McCain. Was it Graham, that if that would have gone, we would have time in legislation in 2009. It was probably that close and- Joe Bonfiglio: Incredibly close. Jon Powers: Yeah. And there’s a lot of lessons to come out of that, including the fact that the environmental climate community wasn’t prepared to offend the blue dogs and others that voted for the climate bill to begin with. Jon Powers: And I think that scared a lot of senators off, but at the same point, they haven’t gone to work at the Pentagon. Not long after that. People just didn’t use the word climate change for years in Washington. Right. And then it’s re surged, it’s come back into a very positive way. You and I talked about this before last year in particular, you had the emergence of Greta in the cultural awakening. That’s continued to move forward. I want to jump forward to EDF here and sort of the political awakening, hopefully that will continue to move forward on. But what took you from the Hill into the advocacy side? And I do want to talk about EDF Action. And sort of what the mission is. Joe Bonfiglio: Yeah. And you actually alluded to that a bit in that transition, in that during the cap and trade fight, there was no cover right for politicians to step out. And the other side was … it was to remember the moment. It was that pivot from issue advocacy to politics, citizens united. It was exactly that moment where politicians were getting beat up in direct mail, radio, TV on every single thing that they did. And in this case too hot button issues. Healthcare, and climate cap and trade or cap as it became a sort of well driven home. And what drew me to EDF was a very much knew what was missing from that fight. And it was the ability to influence folks back home and congressional districts in key states, the same way that the issue opponents had been doing and wanting to grow EDF Action. Joe Bonfiglio: Posted this job to help a manager of this organization that they wanted to grow. I thought that was intriguing. And it sort of drew me from the Hill and really have been here for just about nine years. Jon Powers: Yeah. So for folks that are not familiar with the politics side of things, EDF, we keep talking about is environmental defense fund. And there is a C3 nonprofit arm that does amazing policy work, legislative work, advocacy work. But once you get more and more political on that work, you’ve got to create what’s known as a C4 which is a different tax treatment to money raised. Joe runs the C4 side of that. Can you talk a little bit about sort of the mission of EDF C4, EDF Action and maybe how that mission has sort of evolved I guess? Joe Bonfiglio: Absolutely. So EDF Action is EDF’s advocacy partner as we term it. And the organization does really two things, it is the lobbying entity or a lobbying arm for EDF, not just in Congress, but in key states. For folks that are sort of tuning in. And if you’re listening, don’t know EDF, it is a global organization, but has a really big domestic program of work so that we are pressing for change in Congress, but we’re also pressing for change in New Mexico and Colorado, California. Joe Bonfiglio: And the 501 C4 is the primary lobbying vehicle. But it also has the ability to influence politics. This is something that we’ve added over time. Really started in 2014 and then of course, sort of eyeing a big election cycle in 2020. We are able to influence politics in a number of ways either by helping raise money for candidates, or in some cases executing what are called independent expenditure campaigns. Joe Bonfiglio: Those paid communications that are in support, or are sort of against a politician, be it a Congressman or a Senator, or in the case of last cycle candidates for a water board in Arizona. So being able to weigh in and influence how those perceive these individual candidates is really incredibly necessary part of the work. And it’s scaled at EDF Action for really in the last couple of years. Jon Powers: Yeah. Let’s go back to the water board side. I want to talk through that as sort of as a case study. For folks that are sort of unfamiliar with why this influence matters, to take it out of Washington for a second, and talk about as much as you can the role that you guys played and add some color to why that race was important and important setting policy going forward. Joe Bonfiglio: We do the elevator of … the background of why this became important. And we’ll sort of get to the political expenditure. Water is hugely important in the Colorado River basin and out West. It is certainly quantity and quality issue, but quantity and given all the agriculture and all the irrigation out there, it is just a tremendous hot button issue. And coming to any sort of progress on these issues that are so difficult takes years. So for the better part of the last five, 10 years, the States in and around this watershed had been trying to come up with a water conservation plan or an agreement of pact between these key States. Arizona was a holdout and Arizona was a holdout for a variety of reasons. But they just couldn’t quite align the water districts, the folks that assign water rights to various entities, wasn’t bought in on a plan, legislature wasn’t bought in on a plan. Joe Bonfiglio: And of course, when you don’t have that type of alignment, you can’t get it. So there was an opportunity in 2018 to help shape the water board. And the water board had a number of open seats in Maricopa County, really Phoenix, the really big County, there’s a ton of people. And there was a number of seats that were open. And there were a number of candidates that were water conservation minded candidates for this board. And we saw this as an opportunity to help shape who was on this board and show that there was a lot of support for finally pushing forward, finally moving forward on this water conservation plan, we did that by backing these candidates, they ended up winning seats on the board and fast forward, the next six months went as quickly as you could have ever hoped the board came together, approved again, this multi-state pack. Joe Bonfiglio: The legislature approved the plan that the board moved through. And actually, I was like, there’s a piece in Congress. The Arizona delegation actually brought up before Congress, passed through Congress. And now, again, some of that took nearly 10 years from the idea through its implementation, there’s a plan out West to divvy up water and conserve water. And I just don’t think that would have happened in the timeframe that we just talked about without that political push. Jon Powers: It’s why politics matters to policy, right. I think it’s critical. Joe Bonfiglio: Absolutely. Jon Powers: So, we’re doing this interview, it’ll air later, but this is literally on Earth Day. We’re both doing it in our home because of COVID-19. And I’m going to look at the 2020 campaign with you a little bit here, but I want to look at it first, pre COVID and then look at sort of the last 60 to 90 day push at the end of the year, starting obviously with probably what’s on most people’s mind, the presidential. But then, talk a little bit about the house and Senate as well. Jon Powers: There’s no doubt about it. Climate was elevating up as a top tier issue, especially during the primaries, but across the country in a way that at least in my lifetime, I don’t remember being at this level before. Can you talk for a second about what you guys were seeing in terms of numbers there and the interest of the sort of the voting public on these issues. Joe Bonfiglio: Yeah. And you hadn’t seen in your lifetime. I hadn’t seen in my lifetime, the issue has and I don’t want to say past tense there, because I think there’s an underlying thread of this that will remain. But climate pop is a salient political issue really in 2018 and 2019 just took on a life of its own. I think you had Anthony Leiserowitz on your podcast before. Joe Bonfiglio: He runs Yale’s climate communications program. And their tracker is something that we always go back to, and it’s a great sort of where the issue has been, where it is now. And their tracker in 2019 saw just an incredible amount of growth as people crystallize on the problem. Saw that it needed a solution. And then again, to attach that to politics. So, from his survey, more than four in 10 registered voters, about 45% said that a candidates position on global warming would be very important to their vote in the 2020 presidential. And that was an increase of seven points in just about a sort of that critical three month period of time when the democratic candidates in 2019 were sort of just marching out there. Joe Bonfiglio: And that growth was not just Democrats. Democrats in that survey were up about eight points in that sort of measure, but also in independence. I think that’s a nod back to what we saw in 2018. The issue- Jon Powers: The cultural moment at that time, is that an admits of sort of the Greta- Joe Bonfiglio: The moment of Greta, and again, you’re sort of seeing not just that and the awareness on the issue, but people connecting it to their vote. The idea that climate moved from, and it’s always been on the issue set. So when political nerds look at how people are thinking about who they vote for, they sort of rank issues. And the issue list that I just tested could be 25 issues long and the climate across the political spectrum was at about 11 on that list. But that had been up nearly six or seven points from the year prior. Joe Bonfiglio: But since that cultural moment pushed the intensity of the issue in their brains. And in turn, how they’re going to factor their vote. But among Democrats, and this is where I think you really saw it sort of play with politics. It was a top three issue with liberal Democrats, their number one issue. Joe Bonfiglio: So you saw the early primary States of Iowa and New Hampshire, Nevada, and South Carolina, where candidates are going through talking about the core issues of those States. And then everyone’s doing a riff on climate. Because it was just one of those, in that moment, a flash point in politics and democratic politics. But I think in politics at large. Jon Powers: Yep. Interesting. So let’s go to say January, right before we sort of began to really think through and launch our shelter in place in March. Jon Powers: Was that momentum continuing? I mean, we’ve probably had gotten through Iowa, we weren’t in a place where Biden was the nominee, but that momentum that interest as people started to go to the polls in January and February, did we see evidence that continued forward? Joe Bonfiglio: Absolutely. And in the closing days of some of those early primary states, you had, again, candidates communicating on climate in a very short campaign of Michael Bloomberg, who ramped up and ramped out about as quickly as I’ve ever seen spending massive amount of money. This is a candidate that quickly learned that in order to reach voters, you had to talk about climate and ran in some cases, three different climate ads in key States. Joe Bonfiglio: At one point, Michael Bloomberg had three different climate ads up in Florida. Jon Powers: Wow. Florida. Joe Bonfiglio: Again, it’s a little bit of, it’s an non-scientific, but I’ll tell you, they were doing the research to figure out that that was necessary. And of course the resources to allow that type of variety. But, again, that feels like a million years ago, but it was really just a few months ago. Jon Powers: Yeah. Less than 60 days when you think about it. So, now we sit here as we’re having this conversation, Bernie has officially come out and backed Biden. The democratic party has started to come behind a nominee. I think we both agree, obviously that this is probably the most dangerous president of our time to our issues, whether it be EPA undercutting, methane issues, or, just undercutting science as a whole. To the point that for the first time ever EDF action, which is a bipartisan organization, came out that counter the president. Jon Powers: Do you want to talk for a second about that effort at EDF? And then I do want to talk about sort of the last three months of the campaign. Joe Bonfiglio: Yeah, absolutely. And I credit Trump and this unfortunate last of actually driving some of that movement of the political salience of climate. So it’s a bit of a tangent, but people sort of wonder why voters have focused on this issue. I actually think Trump is one of those reasons. Jon Powers: Oh, interesting. Joe Bonfiglio: Because his language on climate has been denialism calling it a hoax, calling it a Chinese hoax actually to be fair, it’s unfortunately true. The administration has walked the walk or walked the talk. I think the New York Times has a running tracker of more than 100 anti-environmental actions the Trump administration has either started or finished in the three and a half years at they’ve been running the show. Joe Bonfiglio: We did a quick look at what EDF and EDF Action were working against. We were working against, I think 37 of those directly. So had our hands full across a range of issues. But on climate, even just, I think a week or two ago, trying to finalize and push through the auto rules, the auto efficiency rules. I don’t even think that the automobile industry wants to fight just because of the timing here. They want to get it done before a new Congress comes in or a potentially new president comes in. So it’s locked in. So even in the midst of this health crisis, you are seeing just the focus of an administration to do as much as they possibly can to unravel climate and environmental progress. Jon Powers: Yeah. It’s interesting. I feel like that’s a such an untold story or this image because people focus on what he says, what he tweets. I don’t think he actually has a whole bunch of personal anxiety around these issues at all, but he puts in charge a coal lobbyist at the EPA or cowboy department of interior and they just tear apart, especially at EPA, they came with their knives, they knew what they were doing. They went after the rules and they’ve done things that people just don’t really pay attention to in the general public that are going to have longterm detrimental impacts to our health and the health of our planet. Joe Bonfiglio: Very smart and very smartly are not dismissing rules, it’s rewriting them. They’re rewriting them to do nothing. So again, the president’s language is kind of buffoonish, but the team that is undermining a lot of these environment productions knows exactly what they’re doing. Jon Powers: Exactly. And I think for people that don’t understand, like the rules process, so you can’t just fix it day one, you got to go back in, it’ll take years of a new administration to get us back to where we were a near loss and progress. So let’s look ahead. We expect to have a Biden candidacy versus Trump here in 2020 leading into November. Traditional politics there was going to be a convention this summer, where folks are laying out their platforms. And then, folks go to Ohio and Pennsylvania in October, knock on doors to try to get their candidate elected, who knows if that’s even going to be possible, if they’re going to be doing it in masks or are able to go at all. How does COVID effect the election this year? Jon Powers: How do you guys sort of think of your playbook? And as much as you want to share, your ability to affect that? And will climate be an issue people are voting on again, or is it just literally the incompetence around COVID that’s going to drive this? How does this sort of begin to play out the next few months? Joe Bonfiglio: Whenever this launches, these answers could be woefully out of date. I think we’re in this moment Jon Powers: Yeah. That’s true. Joe Bonfiglio: We are expecting this health crisis to shift to an economic crisis or an economic recovery, or sort of an economic recovery. God knows when. So, we’re trying to figure out this election and it is a very classic moving target. Use your analogy, Lucy pulling the football. Joe Bonfiglio: This is one for the ages. And sort of pulling back, I’m trying to wrap my head around an election that not only deals with a health crisis that has us in our homes for the most part or certainly normalcy not looking like 40,000 people packing college football games anytime soon. Right. I mean, that was sort of what we all were looking forward to. Or if you’re basketball, baseball, that’s not going to happen. So we’re never going to get back to Jon Powers: I would like to point out as a wild Buffalo Bills fan with the best lineup we’ve had in the best part of this millennium. If the NFL season doesn’t happen it’s going to be just heartbreaking. Joe Bonfiglio: Well, if it happens, it’s not going to look good. Jon Powers: I’ve had season tickets for 20 years tickets and I’m not going to be able to go to the games. Joe Bonfiglio: I mean, you’ll have a great seat in front of your TV but that is sort of the new normal of that piece of the social distancing, what have you, mixed with an economy that is not just going to bounce right back. I think people aren’t sure understanding incredible partisanship. So we’re going to try to figure out how to navigate this election cycle with these just huge drivers of how people are viewing politics. We have voted through Wars. We have voted through crisises, but we’ve never actually voted or gone to the polls with all these things stacking upon each other. Joe Bonfiglio: And I don’t ever remember a time when I was studying this as a kid or doing this professionally where you had this sort of deep partisanship that is driving how people view a health crisis and economic crisis, and eventually how people are allowed to go vote to one of your sort of questions. Jon Powers: So looking ahead for people, if you listen to this podcast, you most likely believe in climate change is happening and you want to drive action on this. So what advice do you have for the audience of how they can play a role to make sure this continues to be a top tier issue going forward. And is there ways for them to engage, figure out talking points to convince folks on those Zoom calls, maybe not when they’re knocking on doors or whatever the approach is going to be that 2020 continues to be not just a dramatic election for our economy and for our personal health, but for the health of the planet. Joe Bonfiglio: Well, so we’re going to have to figure out how to campaign in this moment. And we’re sort of jokingly say Zoom calls or telephone calls, or texts, sort of however we’re engaging with people these days. One of the most important things that people can do or need to know is that we’re going to need help in talking to voters, right? Because that doesn’t actually change. That part of campaign politics is constant the sort of delivery method is going to maybe be different, but we’re going to have to talk to people. Because I think that voters understand what’s at stake this election cycle. But they are not going to focus on this election until the very end. So folks listening to this podcast, first things first, there will be opportunities to join the fight. Joe Bonfiglio: One of the easiest ways that we provide is by going to EDFAction.org/join, and you’ll get all the updates of the things that we’ll try to pull off. Which could be using our members to call voters that may not show up at the polls. Help them understand that their state has just gone to a mail in ballot. That’s another piece of this puzzle that’s going to shift over the course of the next couple of months which states open up their absentee- Jon Powers: Yeah the disinformation campaign that’s going to counter that it’s going to be phenomenal. Right. So how do we- Joe Bonfiglio: It’s going to be incredible. Jon Powers: Yeah. Interesting. Joe Bonfiglio: We view ourselves as a group that wants to help people go vote. We’re going to have to figure out how to navigate that. And pull these people in to help push that process. Jon Powers: Right. So I live in New York, right. There’s a likely chance New York’s going to go for Biden but I want to help influence folks in Ohio or in Cleveland or in Virginia, where I used to live. How does someone who doesn’t know or had not been involved in campaign before, but also realizes this is the most important election of our lifetime. How do they get involved? Do they sign up at EDF Action? Any other sort of advice on how they can dip their toe in the water for the first time? Joe Bonfiglio: Yeah. There are so many efforts that are going to spark up and I think you’re going to be tripping over opportunities. And I sort of mean that figuratively. Joe Bonfiglio: Right, right. But the way we’re communicating now is exactly how we’re going to have to … from our homes in either New York or in this case, for me in Northern Virginia, talk to people and urge them to consider what at stake this election and go and vote. There will be a lot of virtual ways to do that. We’ll put that out there, but if you are attached to any organization, be the Sierra Club, League of Conservation Voters, maybe EMILY’s list, Planned Parenthood. A range of environmental and progressive groups out there are going to put together a really great program. Maybe go outside your comfort zone a little bit. If you really hated knocking on doors in this case, it’s to be phone calls. And phone calls to people that are going to need to hear someone’s voice to get out there and vote. We’re going to have to do that. Joe Bonfiglio: And our partner’s going to have to do that. And I think people that have never done this stuff before are going to have to sort of get past that sort of nervousness and get out there and help out. Jon Powers: Yeah. I couldn’t agree more. I think people need to really take action. And the second one is in these tough economic times to open your wallet, go to EDF Action. And even if it’s $25, help make donations help drive the change. Because it’s going to be critical, critical going ahead. Joe Bonfiglio: I just want to say that so many people continue to do that and they recognize that we have a fight ahead of us. And are continuing to give, it’s incredibly necessary. Joe Bonfiglio: And so very, very much appreciated. Jon Powers: So going back to yourself, North Carolina, you’re about to leave to head up to the city in D.C. And with your stack of resumes. If you could sit down with yourself at that time and grab a coffee or grab a beer and give yourself a piece of advice, what would you say? Joe Bonfiglio: It was a 1994 blue Honda Civic that I had forever. I think I put like 220,000 miles on that car before I donated it to the local NPR station, because it probably shouldn’t have been on the road. I think that person didn’t fully appreciate how I think truly lucky, 18, 20 years later, he would look back at a life that has been really, really good. And I think I should have told myself to appreciate each of those moments that were so fast and fleeting, especially with my time on the Hill. And through some of these election cycles, because I think looking back at it, it’s been a great run. Joe Bonfiglio: I’m not done yet. I know in the moment I just zip right past it and probably tried to find the cheapest beer and wing night after something really fantastic or sort of, again, wonderfully nerdy happened, over the course of a typical Hill day or something. Jon Powers: All that homework you’ve done. All the experience, I think leads to, I mean, we’re in the Super Bowl right now, if there ever has been for our fight. And I think we ask folks to pay attention and support EDF Action and other organizations that are out there, help me advocate for this change. Joe, thank you so much for joining us at Experts Only. Joe Bonfiglio: Jon, thank you. Jon Powers: Yeah, absolutely. And I thank the team at EDF Action for helping to put this together. Thanks to Carly Battin at CleanCapital. Who are also helping to put this together. You can get more episodes at CleanCapital.com. As always I look forward to your insights on folks we should be talking to. Feel free to send those our way. And I look forward continuing the conversation. Thank you. Jon Powers: Thanks for listening in today’s conversation. Find more episodes on 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. We look forward to continuing our conversation on energy, innovation, and finance with you. [/av_textblock] [av_social_share title=’Share this entry’ style=” buttons=” share_facebook=” share_twitter=” share_pinterest=” share_gplus=” share_reddit=” share_linkedin=” share_tumblr=” share_vk=” share_mail=” av-desktop-hide=” av-medium-hide=” av-small-hide=” av-mini-hide=” av_uid=’av-354olk’] [av_hr class=’invisible’ height=’40’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_button label=’More Podcasts’ link=’page,5266′ link_target=” size=’small’ position=’center’ label_display=” icon_select=’no’ icon=’ue800′ font=’entypo-fontello’ color=’theme-color’ custom_bg=’#444444′ custom_font=’#ffffff’ av_uid=’av-jx1x7jx3′ custom_class=” admin_preview_bg=”] [av_hr class=’invisible’ height=’40’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”]
Experts Only Podcast # 65 With the Expert in Sustainable Grantmaking, Marilyn Wait [av_image src=’https://cleancapital.com/wp-content/uploads/2019/03/podcast-image-pageheader2.jpg’ attachment=’4329′ attachment_size=’full’ align=’center’ styling=” hover=” link=” target=” caption=” font_size=” appearance=” overlay_opacity=’0.4′ overlay_color=’#000000′ overlay_text_color=’#ffffff’ copyright=” animation=’no-animation’ id=” custom_class=” av_uid=’av-jwwgyb48′ admin_preview_bg=”][/av_image] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” template_class=” av_uid=’av-jwwgxszg’ sc_version=’1.0′ admin_preview_bg=”] Experts Only Podcast #65 With The Expert in Sustainable Grantmaking, Marilyn Waite [ Program Officer in Environment, William and Flora Hewlett Foundation ] [/av_textblock] [av_hr class=’invisible’ height=’10’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwl4lsb2′ admin_preview_bg=”] This week’s guest is Marilyn Waite, Program Officer in Environment at the William and Flora Hewlett Foundation and author of the book Sustainability at Work: careers that make a difference. Marilyn manages the foundation’s grantmaking on climate and clean energy finance with the ambitious goal of addressing climate change by accelerating the transition to a climate-friendly economy. Her book, now used in higher education curricula in the United States and China, is a compelling guide for everyone who wants to have both a successful career and a career that makes a positive difference in society. [/av_textblock] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” font_color=” color=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” id=” custom_class=” av_uid=’av-jwwh5253′ admin_preview_bg=”] Listen now: [/av_textblock] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ id=” custom_class=” av_uid=’av-k4so2umi’ admin_preview_bg=”] [av_image src=’https://cleancapital.com/wp-content/uploads/2020/05/ExpertsOnly-Waite-bar.jpg’ attachment=’7508′ attachment_size=’full’ copyright=” caption=” styling=” align=’center’ font_size=” overlay_opacity=’0.4′ overlay_color=’#000000′ overlay_text_color=’#ffffff’ animation=’no-animation’ hover=” appearance=” link=’manually,https://link.chtbl.com/6Xr0g4Ym’ target=’_blank’ id=” custom_class=” av_element_hidden_in_editor=’0′ av_uid=’av-k37p0z0j’ admin_preview_bg=”][/av_image] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwwh5253′ admin_preview_bg=”] Full transcript: [/av_textblock] [av_hr class=’invisible’ height=’40’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwwh5253′ admin_preview_bg=”] Jon Powers: Welcome to Experts Only podcast sponsored by Clean Capital. You can learn more at cleancapital.com. I’m your host Jon Powers. Each week we explore the intersection of energy, innovation and finance with leaders across the industry. Thank you so much for joining. Jon Powers: Welcome back to Experts Only podcast. I’m your host Jon Powers. We have an exciting conversation today with Marilyn Waite, who is at the Hewlett Foundation. She’s a program officer in the environment, but what she’s working on is phenomenal climate finance solutions, addressing the gaps that exist both domestically but also internationally and changing the game and how we can bring more capital into the solutions we need for climate change. Jon Powers: As we talk about Marilyn’s got a really interesting background from spending time in Madagascar to working for a French nuclear company to being part of Village Capital. She’s also an author of the book Sustainability at Work. You can get that link through our website, and I hope you enjoy the conversation. Jon Powers: Marilyn, thanks so much for joining me at experts only. Marilyn Waite: Thanks, Jon. Thanks for having me. Jon Powers: You’ve got an incredible background. I do want to talk about so many of your experiences from publishing the book Sustainability at Work to living in Madagascar and Princeton and Cambridge. Before we go down that path, I really want to explore what first got you interested in the sustainability and the sustainability place to begin with? Marilyn Waite: I’ll give you a somewhat long version of that. I had studied environmental engineering in university and was excited to apply some of that knowledge. I went off to Madagascar and worked for the United Nations on water resources primarily. From there, I really experienced firsthand our energy woes, especially in emerging economies. I went for a few months without really reliable, stable electricity. The local utility had ran out of money and ran out of the water for the hydroelectric power. Marilyn Waite: I was confronted head on with the challenges of providing clean, reliable energy for the masses globally. I shifted focus from there, from the water sector to the energy sector, went on to study engineering for sustainable development and got into the nuclear energy industry. I went to work for a recycling spent fuel plant in rural France, and from there, went through a lot of different roles, eventually working on the construction of new nuclear reactors and then working in corporate R and D on new energy technologies. Marilyn Waite: We were acquiring new firms that were in torrefied fuel pellets for biomass and concentrated solar power, which was a story in and of itself, offshore wind, we even had a fuel cell product at that point. It was really working on all of these new technologies, acquisitions, technical economic studies. It was in that position that I realized a lot of our troubles were less on the engineering and project management side and more on the financing side. Coming up against project finance, corporate finance hurdles when it comes to financing these, at that time, newer technologies. Marilyn Waite: I shifted focus there. I left France to go to China, did a bunch of things there, including a little bit of merger and acquisition work. My plan was to spend a decade in China working on these issues, And mostly because of the air pollution and the investment sector being closed off to foreigners, came to the United States and joined Village Capital to lead their clean energy practice. That’s when I was able to pick a deep dive on one part of this big capital stack, focus on the higher risk part of it, venture capital or seed capital, for companies, startups that were solving challenges in the transportation space, energy challenges in particular. Marilyn Waite: The common thread there really is sustainability, really has impact around the major issues of today, and I was the climate change as number one for that. Then two years ago joined the Hewlett Foundation to lead the climate and clean energy finance portfolio. Jon Powers: Yeah, I do want to come back to that for sure. For people that are unfamiliar with Village Capital, Village is really invest in early stage startups. Talk about some of the work you were doing there. You’ve now gone from being in the projects themselves as an engineer to looking at the opportunities in the landscape to really beginning to look at them as an investor. Marilyn Waite: Right, so Village Capital has a unique model in that the first fund really focuses on peer selected investments. The idea that the entrepreneurs that are in the trenches doing this work day in and day out know best. They understand the customers and the market and the hurdles, and so if you could get a group of peers together that are not competitors but that are generally solving the same problem just in different ways, they would probably be the best form of diligence than an external expert committee. Marilyn Waite: I set the strategy, the investment thesis for our clean energy work, and that was around increasing energy efficiency and goods movement, freight, transportation at large, and recruited firms to take part in this peer selected investment process. We made a few investments from that thesis, including Idle Smart, and there was a micro trigen company as well called M-Trigen, and there was also a electrification of tractor company called Autonomous Tractor Corporation, ATC, and that was the first round of investments made from that thesis. But really the innovation there was getting this peer selected input around investing, especially for these, I would say, real economy sectors that matter a lot to our present day challenges. Jon Powers: Right. How did that early investing viewpoint as emerging companies, how has that helped you look at things in your current role at Hewitt? Marilyn Waite: I definitely understand after that experience that not all capital is created equal. Most of our capital available actually globally, 90% of it, is in the form of bank debt, loans, lines of credit. A lot of people working in finance actually come from that experience or let’s say asset owner-manager experience. It is very difficult to get that more risk averse capital to move into the early stage disruptive deep, decarbonization tech needed, also if it’s all climate change, understanding that capital moves in different ways, has different actors and is organized out there in the world. Marilyn Waite: It’s not just one big pile of money. It’s actually organized on a risk return spectrum, and it’s organized according to what it has been set out to do. There’s a purpose and there’s an expectation around how a mortgage loan book should look versus a project finance book. Some economies don’t even have certain asset classes. In China, there really isn’t this project finance or renewable energy asset class. Jon Powers: Interesting. I’m going to come back to the finance side and your experience at Hewitt. Before doing that though, I definitely want to talk… First of all, I don’t even know how you found the time to do this, but you ended up publishing a book, Sustainability at Work, which is really interesting for folks that haven’t seen it, check it out. Sustainability at Work really is about helping folks explore careers that make a difference. Jon Powers: For many of our listeners, we have students, we’ve got future leaders that are exploring what, even opportunities exists in sustainability, and it’s interesting that even changes a year by year now. You really help introduce people to different verticals like health care, education, media and the law and what they could do for sustainability. First of all, why did you think this book was important? Marilyn Waite: Here I was learning about sustainability and engineering, integrating it, and eventually what happens in those environments is that you think everyone else knows about sustainability and engineering or whatever it is that you’re applying a sustainability lens to. Then I got to the plant, the reprocessing plant, and then was confronted with explaining what that meant and how we were doing it actually. I, for example, was in charge of improving the overall efficiency of one of our workstreams there, a technical chemical process, and involved in that included reducing the reagencies in that chemical process and was definitely in line with making the plant more sustainable. Marilyn Waite: I was confronted with that and I thought, hmm, well this really requires an all hands on deck approach. If we are going to do more than just move the needle on sustainability, environmentally, socially climate change, you name it, then it can’t just be something we do at home or at our leisure. It has to be also at work, and that everyone, no matter what role they’re playing and their work can have an impact. I started to interview people in different fields, so whether they were nurses or pediatricians or talk radio hosts, and asking them about how they’re incorporating this in their jobs. I just developed a thesis around that, but yes, it can be embedded in every single career. Jon Powers: Yeah, it needs to be if we’re going to solve these problems. What advice do you give to folks that are looking to move into the sustainability space? Marilyn Waite: I would say read the book. Jon Powers: Yeah, read the book. Marilyn Waite: Sustainability at Work, Careers That Make a Difference, and there’s a whole framework called SURF that I introduce, supply chain, user, relationships and future orientation. There’s also an article that’s available that breaks that down and think about your strengths first as a professional, like what do you add irrespective of the company that you’re in or the field you’re in, what are your strengths and apply that SURF framework and how you can best have the impact in the type of career that you want for yourself based on your strengths. Jon Powers: Yeah, interesting. Now that you’ve built a phenomenal career in this space, I’m going to sort of transition now to the finance side, which actually a lot of this same conversation has to happen. I think there has been for a decade, ESG was just this additional metric people would occasionally look at and the climate investing was a nice to have. Now, it’s becoming mainstream. Jon Powers: Here’s Larry Fink with his famous BlackRock letter that came out the beginning of this year, but you have even Jim Cramer came out this month with basically saying that oil stocks are on their death knell, because money managers and young investors aren’t putting their money into it. It’s an amazing statement from a guy like Jim Cramer. Marilyn Waite: Oh, I agree with that. Jon Powers: How are you seeing climate finance begin to move mainstream? We need a trillion annually to get to our goals. Are we on the right path? Marilyn Waite: Yeah. Climate finance is really about financing used to fund solutions that mitigate greenhouse gas emissions. There is a data problem here. I will use the CPI, climate policy initiative, data, which says that we have just over 500 USB deployed annually and globally to solve climate change. But you’re right, we need to at least triple that, and there’s a gap. Jon Powers: Where was that data point from again? Marilyn Waite: CPI, Climate Policy Initiative, and that data is improving year on year. One of the gaps that I would mention would be transparent data and disclosure, which we need more of to really track this more closely. There definitely are positive sign coming from all of the different pools of capital, whether you’re on venture, private equity, asset owners and managers, including insurance, pension and mutual funds, and the banks and lending. Marilyn Waite: But there is a lot more work to do, and the particular gaps on the banking and lending side are flagrant, and also when it comes to passive asset management. Now, the trend is positive, but we have to accelerate that trend, and we have to really move quickly and smartly to de-carbonized our financing and investing. Jon Powers: How do you see the philanthropy role here, and can you talk a little bit about the work at Hewlett and why Hewlett is looking at this? Marilyn Waite: Yeah. Philanthropic dollars are interesting because they are very flexible. There are not a lot of rules around them and they are by nature unaccountable. It’s the part of the economy that is probably the least accountable. If you’re in government, you have your citizens, if you are in business, you have your customers and shareholders and other stakeholders. Philanthropy sits in this interesting, apart place. The opportunity of that is that you can be very flexible, you can experiment, you can take a lot of risks, so that is something that we are doing. Marilyn Waite: We are dedicating at least $75 million US dollars over five years to support mobilizing capital for climate solutions. We are really focusing on three markets with that, so where the capital is [inaudible 00:14:00] in China, the European Union and the United States. We are also focusing on certain pools of capital, venture because we still need things like seasonal storage and [inaudible 00:14:13] air capture. There’s a lot of the hard tube, the carbonized things like steel and cement and chemicals, and so we need that higher risk pool. Marilyn Waite: We are focusing a lot on asset owners and the other managers. We just issued a request for proposal or RFP around passive asset management. Now more than half of equities in the US are traded using passively managed index funds. It’s also about a half in Asia, about a third in Europe and it’s just growing, and that’s not just on the stock side. Marilyn Waite: Also on the bond side, so including debt instruments, fixed income and then a huge focus, I’d say the number one focus is on banks and lending and credit, because they are so systemically embedded in the economy, and because so much of the solutions that have to be scaled are bankable and require lending and lines of credit, so a big focus there. I can give you some examples of the types of things we’re doing in each category. Marilyn Waite: On the venture side, we have supported the Climate Impact Fund, which has a climate first thesis. We’re looking for what to do, for example, in the Chinese economy and equivalent to that perhaps. We are- Jon Powers: When you say supporting, does that mean you guys are putting capital right into that? Marilyn Waite: Yeah. Jon Powers: Are you supporting… The emergence of the thesis, I guess. Marilyn Waite: 3 million into the fund. Jon Powers: Excellent. Marilyn Waite: Directly into this very important in the supply chain of capital and getting these different technologies and interventions scaled, commercially valuable at the price point they need to be, to be commercially viable, very important capital that is tied to capital as well. Marilyn Waite: On the asset owner management side, we just issued this RFP that I mentioned that really is speaking to, for example, have all of the default options for our retirement plan be low carbon option, be Paris-aligned, fossil fuel free, all of those things, and so that there isn’t this money flowing inadvertently, but even without our consent to our own demise, to really hurt the planet and our economy. Marilyn Waite: Then on the banking side, lending, there we have for example, supported, meaning directly with their balance sheet, the Clean Energy Federal Credit Union, which is a new credit union in the United States dedicated to clean energy lending. They have the lowest rates for NEV, and for ground source heat pump, air source heat pump, solar, distributed solar in terms of residential and other- Jon Powers: Are they lending to individuals, to companies, to developers? Marilyn Waite: They are currently lending at the residential level, so to households. A brief one on one on the credit unions. Credit unions are democratically owned or member owned. They are on the front lines of really retail lending in the country. They are embedded in politically conservative to progressive districts alike. They are trusted by people across all kinds of demographics. They represent roughly over $1 trillion US dollars of AUM, and so even impacting 10% of their lending for clean energy is important, especially since we need all hands on deck for this. Yes, they are. Marilyn Waite: They can also then to small- and medium-sized businesses. They are a new credit union so they have a few years ago in the regulatory framework before they can do that lending for SMEs, but they are also selling their loan participations to other credit unions from Texas to Montana to Oklahoma so that they can begin to do this kind of lending too. It’s not just them, it’s also scaling it through the credit union system. Jon Powers: Interesting. Marilyn Waite: Yeah. They’re open for deposits, if you want to open a savings or CD with them, and they’re also open for grant capital so that they can scale at the speed we need them to, so that’s an example. Marilyn Waite: Something else that crosses these different assets and pools of capital is something called the Partnership of Carbon Accounting Financials, or PCAF, and that is really getting to that data and disclosure that I was mentioning. Essentially it’s an industry-led initiative, so banks and asset managers coming together in working groups across the globe to harmonize and approach for measuring and disclosing, not the carbon footprint of their brick and mortar branches, but of their actual core business, which is the financing, measuring and disclosing the finance emissions per asset class. Marilyn Waite: Whether it’s a project finance, listed equity, auto loans, mortgages, commercial real estate, you name it, across the asset classes, what are the tons of carbon dioxide equivalent associated with those loans and investments. Then begin to manage those numbers and data, create new products that address it and begin to decarbonize a portfolio using that now newly available data. Jon Powers: Interesting, and then when you are investing in sort of this, by the way, an amazing array from early stage capital to really transforming the data on the markets, is Hewlett publishing or helping educate folks on what they’re seeing out there? Obviously you’re out there doing things like this podcast, but is there a role that Hewlett plays in that education? Marilyn Waite: Yeah, so we make everything publicly available that we do fund. But you have to know we exists, which most people in the world don’t know we exist. No one just automatically goes to our website, so the impact we have really a through what we fund and enable them to communicate what they’re doing is what we try to do best. We’re extremely leanly staffed, so our capacity to educate really is through enabling the different initiatives that we fund to communicate what they’re doing. Jon Powers: Oh, that’s fascinating. Now stepping out of the just the pure Hewlett role and it looking at the broader market, we’ve got… We talked about at the beginning of this podcast an amazing sort of set of trends that we’re really to see. I always go to Bloomberg New Energy Finance for data, but whether there or obviously Larry Fink’s letter. You’ve got the green bond space is just booming. You’ve got FinTech solutions moving forward, married to a transformation that’s happening in at least the US public acceptance of climate as an issue. Thanks to the efforts of folks like Greta, who are raising the cultural awareness and really stamping down the debate anymore. If the last decade was about setting the stage for addressing our climate challenges, what do you see really moving the needle over the next decade? Marilyn Waite: I think you mentioned something very key. You mentioned the movement of the masses and the youth voice. I think the voice of consumers in finance has been missing and we need to amplify that. If we amplify that, that is going to take us over the scale, that will be the one of the tipping points. I think you and I having a bank account being this passive transactional thing where it doesn’t matter. I think those days have to be over, so our money is doing something. It’s being leveraged by at least 50 to one if not more to do [inaudible 00:22:09] financing, and those things can either harm society or help. Marilyn Waite: We have to make that known to the world and to financial institutions that this matters, and move our money accordingly in a very simple way, but also according to those values and make that consumer voice heard. I think that will be a big part of this next decade in really helping us get to that tipping point. I also think disruption in the good way this time will be helpful. I’m not sure, for example, that Vanguard has ever made an acquisition. I think this could be one of its first things to do is to actually… Marilyn Waite: There are products out there. There’re new companies emerging, whether it’s Eco Capital or Newday or all of these, Open Invest, that are aligning with this new society that we have to have if we’re going to solve climate change. I think there’s room for that disruption, this disruption by itself, but also to be incorporated in the mainstream larger players today. Jon Powers: Interesting, so with that, you’ve got some of the larger players, the pension funds and the endowments, who’ve been saying the right things now for years and doing the right things on the divesting, but you’re not seeing as many yet taking the active investing space, where their actual money managers are putting money into assets or climate focus infrastructure. Do you expect that to change here in the next few years? Marilyn Waite: Yes. I would say what you said is true in certain economies, but not in others. I would say, for example, in China there’s actually been a lot on the invest side. Jon Powers: True, yeah. Marilyn Waite: Very little on the divest side, so it can both simultaneously, the biggest in terms of the capital out there, biggest financiers of both climate destruction and renewable energy. We’ve got to change that across the board. There’s not one without the other. We have to be carbonized and mobilize the capital for these solutions, and it’s not just energy, it’s also in agriculture. Marilyn Waite: We have to shift from the current status quo of industrial factory farms to regenerative agriculture, increasing soil carbon sequestration in land and soil, which also leads to, of course, healthier end products, move from annual perennials. All of those things have to happen. We also have… Transportation, we have to… High speed rail is well built out in China and Europe. It’s a complete gap in the United States. Jon Powers: Totally. Marilyn Waite: Really, market by market, these shifts have to happen and it makes economies more competitive in the medium and long run anyway. Jon Powers: No, that’s a great international perspective. I think I have a tendency to look at things domestically, and of course, the Canadian pensions, the European pensions and others are just doing really phenomenal stuff. Our folks here, we have the right path. I think from Clean Capital’s perspective, another is I want to see more capital flowing into these deals. My last question, because I know we’ve got a tight time here, is a pretty standard question I ask all my guests, and if you could go back to sit down with yourself coming out of college or out of high school and could give yourself one piece of career advice, what would it be? Marilyn Waite: Oh that’s a great question. One piece of career advice out of college. I would just say be curious about not only topics but also the people in front of you. Jon Powers: Right, really interesting. Marilyn, thank you so much for your time today and your incredible work. Marilyn Waite: Thank you, Jon. Jon Powers: For folks that are interested, you can get Sustainability at Work obviously on Amazon but also at Marilyn’s website, which is a Marilyn Waite, and it’s W-A-I-T-E, dot com. We’ll have a link from Clean Capital’s website. You can always get more episodes of Experts Only at cleancapital.com, and please share any thoughts on future interviews. I’d like to thank our producer Carly Battin for her help setting this up, and as always, I look forward to continuing the conversation. Jon Powers: Thanks for listening in today’s conversation, find more episodes on 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. We look forward to continuing our conversation on energy, innovation, and finance with you. [/av_textblock] [av_hr class=’invisible’ height=’40’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_social_share title=’Share this entry’ style=” buttons=” share_facebook=” share_twitter=” share_pinterest=” share_gplus=” share_reddit=” share_linkedin=” share_tumblr=” share_vk=” share_mail=” av-desktop-hide=” av-medium-hide=” av-small-hide=” av-mini-hide=” av_uid=’av-354olk’] [av_hr class=’invisible’ height=’40’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_button label=’More Podcasts’ link=’page,5266′ link_target=” size=’small’ position=’center’ label_display=” icon_select=’no’ icon=’ue800′ font=’entypo-fontello’ color=’theme-color’ custom_bg=’#444444′ custom_font=’#ffffff’ av_uid=’av-jx1x7jx3′ custom_class=” admin_preview_bg=”] [av_hr class=’invisible’ height=’40’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”]
Episode 63: Lisa Jacobson & Ethan Zindler [av_image src=’https://cleancapital.com/wp-content/uploads/2019/03/podcast-image-pageheader2.jpg’ attachment=’4329′ attachment_size=’full’ align=’center’ styling=” hover=” link=” target=” caption=” font_size=” appearance=” overlay_opacity=’0.4′ overlay_color=’#000000′ overlay_text_color=’#ffffff’ copyright=” animation=’no-animation’ id=” custom_class=” av_uid=’av-jwwgyb48′ admin_preview_bg=”][/av_image] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwwgxszg’ admin_preview_bg=”] Episode 63: Lisa Jacobson & Ethan Zindler [/av_textblock] [av_hr class=’invisible’ height=’10’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwl4lsb2′ admin_preview_bg=”] On this special episode of Experts Only, host Jon Powers talks with Lisa Jacobson, President of the Business Council for Sustainable Energy (BCSE) and Ethan Zindler, head of Americas at Bloomberg NEF. Bloomberg NEF produces and BCSE underwrites the Sustainable Energy in America Factbook, which provides up-to-date, accurate market intelligence about the broad range of industries that are contributing to the country’s move towards cleaner energy production and more efficient energy usage. Why is 2010-2019 named “a decade of profound transformation” for renewable energy in America? Find out as Lisa, Ethan, and Jon discuss the highlights of this year’s report and actionable insights that came out of the research. [/av_textblock] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” font_color=” color=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” id=” custom_class=” av_uid=’av-jwwh5253′ admin_preview_bg=”] Listen now: [/av_textblock] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ id=” custom_class=” av_uid=’av-k4so2umi’ admin_preview_bg=”] [av_image src=’https://cleancapital.com/wp-content/uploads/2020/03/Email-podcast-bar-BCSE-BNEF.jpg’ attachment=’7456′ attachment_size=’full’ copyright=” caption=” styling=” align=’center’ font_size=” overlay_opacity=’0.4′ overlay_color=’#000000′ overlay_text_color=’#ffffff’ animation=’no-animation’ hover=” appearance=” link=’manually,https://link.chtbl.com/zlvHtww1′ target=’_blank’ id=” custom_class=” av_element_hidden_in_editor=’0′ av_uid=’av-k37p0z0j’ admin_preview_bg=”][/av_image] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwwh5253′ admin_preview_bg=”] Full transcript: [/av_textblock] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwwh5253′ admin_preview_bg=”] Jon Powers: Welcome to Experts Only podcast sponsored by CleanCapital. Learn more on CleanCapital.com I’m your host, Jon Powers. Each week, we explore the intersection of energy, innovation and finance with leaders across the industry. Thank you so much for joining us. Jon Powers: Welcome back to Experts Only podcast. We have a really special episode today. It’s a anniversary episode where we are having a conversation with Lisa Jacobson, the president of Business Council for Sustainable Energy, and Ethan Zindler, who’s the head of Americas for Bloomberg New Energy Finance, Bloomberg NEF. For the last eight years, BCSE and Bloomberg NEF put together a Factbook that is helping to tell the story about the revolution that’s happening in the energy space, both in production, delivery and consumption. This year’s Factbook in particular, really talks about the transition over the last decade and the acceleration of what’s happening in the clean energy marketplace. Jon Powers: This is a similar episode that we did last year looking at the 2019 Factbook. What I love about this conversation is the research and data that both Ethan brings to the table and then the advocacy experience that Lisa brings to the table is very powerful and can help really continue to move forward the momentum we need on a policy perspective in this marketplace. There are tools in this Factbook that we can all use. I use it all the time in public speaking and outreach. You can find it at BCSE.org and I think you’ll learn a lot from this conversation. Enjoy. Jon Powers: Thanks so much, Lisa and Ethan for joining me on Experts Only. Lisa Jacobson: We’re happy to be here. Jon Powers: For our audience, this is not the first time you heard us talk about the Bloomberg NEF and Business Council for Sustainable Energy Factbook. We did it previously last year. With the 2020 edition out, this series has done just an amazing job documenting the revolution that we’re seeing in energy production and delivery and consumption across the US. Before diving into the actual report, and I do want to talk about some of the reflections of what we’ve seen in the last decade and what you hope to see in this coming decade, just to level set everyone, can you talk a little bit about, Ethan, why Bloomberg decided to partner with BCSE on this and what you guys see coming out of this report every year? Ethan Zindler: Sure. Again, thanks, Jon, for hosting. Thanks, Lisa, for partnering with us on this. The goal of the Factbook is pretty simple, which is to provide facts. I’m based in Washington and someone who is part of a firm that tries to provide hard economic research and data to those in the investor community primarily, and others in the energy field who are trying to make money or avoid losing money on the energy transition. So part of what I see as the goal of this is simply to provide that same level of sort of up to the, literally up to the minute kind of information to policymakers here so they are as clued in about all the exciting changes that we’ve seen gone on in the energy world as people like you and others are at the moment. Jon Powers: Lisa, for the Business Council, you and your members do such an amazing job helping to tell the story of where the market is, where it’s going, and help bringing a different voice around advocacy into Washington so that it’s not just about what we’re doing for the environment, but it’s about jobs and the economy and finance and development. How does the Factbook empower your members and what do you guys do with it when you’re going up to the Hill or to state capitals and other places to help advocate for policy? Lisa Jacobson: Well, thanks, Jon, and yes, the Factbook has really become the foundation of all of the organization’s work. Business Council for Sustainable Energy is primarily a policy advocacy organization. We work in Washington DC for federal policy, but we also work at state and local levels. As you know, we also have a strong interest in the international energy and climate change agenda. So we participate in the UN Framework Convention on Climate Change process. We also participate in the Clean Energy Ministerial process. At any given year, there might be other international forums of interest to us. It really started about 10 years ago when the project launched. BCSE had invited at the time, NEF, New Energy Finance. Ethan and his team did come talk to our board and we were beginning to see some dramatic changes. But across the sectors that we work in, natural gas, renewable energy, energy efficiency, it wasn’t yet really well understood. Then people weren’t knitting it together in a way that was understandable to policy makers. Even to some of us around the table as we were trying to describe the… Lisa Jacobson: We’re companies and associations, but when we’re talking to policy makers, we didn’t really have a handle on it in a holistic way. So that was really the demand. We needed it to better understand what was happening to our own industries and how it related to our peers, but we also needed a resource that would focus on the sectors that we represent and do it in a way that was fact-based and that focused on economics and that we could present it to policy makers in a user-friendly fashion. I think the Factbook really does that. Policymakers aren’t the only audience. It’s obviously journalists, it’s the public and it’s industry. When we look at who really uses the Factbook, about 40% of our downloads each year are from industry. So there’s a real need for industry to understand these changes as well. We take this with us everywhere we go. Right now, we are kind of in our roadshow period. We just released this a month ago and we are talking to many policy makers and partner organizations about the findings. It’s really an exciting time. Jon Powers: Yeah, it is an exciting time. The fact that you take this both the industry to state capitals to Capitol Hill and tell just a phenomenal story. Really, what I love about this Factbook this year is it’s a chance in 2020 to look back over the last decade. You guys framed it up so well that 2010 delivered the decade of clean energy, we saw renewable energy nearly double, jobs in the space just absolutely hockey stick in growth. As you look back at this last decade, what is some of the things that surprised you the most that made it, what you guys call, the decade of profound transformation? Ethan Zindler: Gosh, I don’t know where to begin. You just mentioned a bunch of them, but I think, and maybe this is just because I tend to focus more on power generation, less on efficiency than Lisa does [crosstalk 00:07:10] than me, but the fact that basically, our demand for energy overall and proactivity in particular has basically been flat for a long period of time. The interesting thing about the last decade is that it actually was a very long period of sustained economic growth. It wasn’t blockbuster growth, but it was growth. We had GDP growth every year of the decade coming out of the great recession. Yet, our demand for energy basically stayed flat through the decade. So that to me, at least was a surprising thing if you look at it across the full piece. Lisa Jacobson: Yeah. Two things I’ll highlight is affordability number one. We were just at a presentation at the Environmental Protection Agency and one of the comments and discussion we were having with some of those folks was around cost reduction. One of the slides that Ethan put up was basically looking at power purchase agreement prices in different markets in the United States and contrasting kind of the benchmark price range. Then he overlaid, in this case, wind and solar PPA price ranges in different regions. I don’t think I would’ve… I would’ve hoped, but I don’t think I would have thought 10 years ago that un-subsidized wind and solar would be more competitive than the benchmark price in as many markets as it actually is in the United States now. So I think that is very surprising to me, but a hopeful surprise, it’s a good news story. Lisa Jacobson: That’s just two areas, but could look at battery storage prices coming down 85% a decade. You can look at energy efficiency initiatives and business model changes which lower costs. Then that is a good segue to the next kind of surprising thing when I look at the data, is really this empowered consumer and looking at the corporate side, but it also is happening in residential settings, just the ability because of technology and cost reductions for entities in our economy to manage their energy choices. I don’t think I would have imagined it at the scale that it’s happening right now. Lisa Jacobson: For the corporate PPAs in particular on renewable energy, at the end of 2019, it was 13.6 gigawatts of corporate PPA signed for renewable energy. That is huge. When you compare that to what’s being built and kind of the generation mix changes, that’s a really strong signal that this is an economic choice and that it’s not going to be completely constrained by regulatory change, which can be very slow and very painful. I know you know that well. Jon Powers: Yes. Lisa Jacobson: So I think those things I wouldn’t have anticipated that basically, the power of corporate purchases would be a dominant factor in what’s driving renewable energy growth. I don’t think I would have anticipated that it is right now, in this moment in time so powerful in that way. Jon Powers: Yeah, I find it interesting that it’s not just the fact that they’re making this commitment, so they have now sophisticated energy procurement offices that really didn’t exist 10 years ago, no one had an office that was pushing on policy in Virginia to help bring renewable energy like Google does or really sophisticated PPA acquisition teams like Apple and Amazon and Walmart. That development is really creating these corporate behemoths that are helping to drive the market for actually, CleanCapital, right? It’s actually who we work with, which is really exciting. Jon Powers: So if 2010 to 2020, maybe not facing headwinds, but there was a slog and a continued growth as the momentum began to come in place. Now, we’re facing the next decade where you talked about storage prices coming down for instance. Right? But we’re still in the nascent part of the storage market. But you’ve got, I think it’s 40% of Americans now live in states that have 100% RPSs including Virginia, which having been a previous Virginia resident, I never thought would happen. You’re seeing state level policies changing because of the work that, Lisa, you and your team are doing. The markets are really starting to break out here. Jon Powers: What do you s expect to see maybe in increments of maybe the next five years of this Factbook, and then maybe decade back? Are these numbers going to kind of continue to the trajectory going on? Do you feel like changes in was- There’s a lot of questions here. Sorry. … changes in Washington, if they happen, will help continue to accelerate the growth of renewables in the space? From your depth of experience you’ve gained looking at this for the last eight years, help us envision where we’re going. Ethan Zindler: With the caveat that this is not what you would call facts, but more- Jon Powers: Sure. Ethan Zindler: … hypothesis, and really more of to be clear, the NEF of Bloomberg, the NEF’s position and thoughts in terms of where we see things. Lisa Jacobson: … it’s important that you’ve had really diving into this data for a decade, right? So the thought analysis going into that hypothesis is very well defined compared to folks that are just maybe getting into- Ethan Zindler: Yeah, no, thank you. It is. I would say that, look, we think that in the short-short run we have a boom in particularly, this calendar year, and we’ll set aside coronavirus entirely for a moment, but assuming no coronavirus impact, this is scheduled to be the biggest year ever for renewable energy installs in the United States in part because last year was the biggest year we ever saw for renewable energy investment- Lisa Jacobson: Right. Ethan Zindler: … in clean energy in the United… So there’s a bit of an echo effect. Also, we’re coming up towards the end of the tax credits are ramping down and so that’s kind of front loading some activity and why we think you’ll see such a bumper crop of activity this year in particular. We do think the market probably goes down to somewhere to eight to 10 gigawatts of renewable billed per year over the next three or four years after that and then comes back up again. The challenge overall is of course, the US… The great news for US competitiveness is that we’re not really demanding a lot more energy or electricity. As for new build though, of course the opportunities are really about replacing existing stuff. You can only build so much new stuff in a year anyway as a result of that general trend as we continue to phase through and phase out our existing coal fleet overall. So that’s that probably on renewables. Ethan Zindler: On the electric vehicle front, the electric vehicle market in our view, continues to be driven to a large degree by very direct subsidies. The tax credit cap on the number of electric vehicles that both Tesla and GM can sell to consumers where the consumer gets the full $7,500 tax credit in their pocket, that cap inhibits the market a bit. Literally at this moment, there’s conversations about trying to extend those credits and how that might fit within the [inaudible 00:14:37] et cetera, et cetera. But our view on electric vehicles looking three to four years out is that none of that will really matter because the cost of an EV will be so competitive that sales will just take off. Again, that’s our projection theory, but also it’s based on hard facts, which is that we know that as the number of battery manufacturing facilities come online, the price declines and we’ve seen that now for 10 years. Our projections on batteries are simply based on the next tripling of worldwide manufacturing that we literally can see happening because the plants are being built as we speak. So that’s why we’re very optimistic about that overall. Ethan Zindler: But the last thing I would just say about this is that the last 10 years have been so dramatic in terms of the amount of change that we’ve seen. One of the things, points that I always like to leave audiences with when I get a chance to speak to those, especially people in utility executives is that have one of the most dangerous and riskiest assumptions that you can make is that where we are right now is where we will be 10 years from now. The level of change and the transition that’s underway has so much momentum now that that it’s hard for me to see that and not continuing. Now exactly how far we go and what the permutations will be obviously are to be determined, but the world we live in now is a world of change and that’s going to continue. Jon Powers: Yeah, that’s a great point. Lisa, it sort of leads into the next question for me is I actually recently wrote a piece actually called it from Gretta to the board room where arguing that the cultural transformation around climate is deepened and happening in a way that I think may have been in the early part of the century, but then sort of faded because of the stakeholder pushback against it. But now, it’s changing in a way that I believe it’s pretty permanent, but we’re also seeing boardrooms change. You talked about corporate PPAs for instance. You’ve got BlackRock leading the way on major commitments around investing. You even had Jim Cramer come out recently, calling him sort of the death knell of the oil stocks, which was a fascinating commentary by him. But I want to get back to the corporate side for a second. You do have these corporate behemoths that have done a wonderful thing by leading by example, but do you see that trickling down now into sort of the next level of companies who may not have the resources of an Apple, in a Walmart and a Google that do these massive procurements? Lisa Jacobson: Well this is clearly an area where Bloomberg NEF has done a lot of looking. So I will let Ethan maybe share a couple more thoughts on that, but I think the answer for large companies is yes. Just as we saw the Carbon Disclosure Project- Jon Powers: Right. Lisa Jacobson: … and corporate sustainability initiatives evolve over, really going back I guess to the late eighties and then in the period of the beginning of the 2000s. Really, that’s when the CDP really took off with their questionnaires and the like. Those companies are in the spotlight and there’s a lot of opportunity. It’s not just work. It is a lot of work, but there’s a lot of opportunity. One of the things that I look at and we focus on this a little bit in the Factbook is yes there is corporate renewable energy purchases, but now there’s green fleet initiatives. Jon Powers: Right. Lisa Jacobson: There are energy efficiency initiatives that have always been important. But now, there’s much more sophisticated optimization that can be had. I really think this is a significant thing. One of the questions that we have and we haven’t actually really talked about this much, Ethan, and you try to fill this market niche, it’s how do we capture small and medium size companies? I guess we could also… We’re now talking about the corporate sector, but it also is important for communities. How do we enable all that wish to benefit from clean affordable energy to have access to it? There’s a lot of market movers and they may be very big and structures are getting more comfortable for them, but there’s a whole lot of other players that are interested. Jon Powers: Yeah. The reason I asked the question because I feel like we engage with a lot of those sort of mid market size companies, or we engage with the city manager of a small city in Massachusetts who doesn’t have the capacity or the resources to even… Doing a PPA for them, they may do one or two. They could be significant if they do them correctly, but they don’t have a team of analysts around them that are executing, but they’re so critical for that next phase. Ethan Zindler: I would just agree with all that and say that look, small and medium enterprises often do business with bigger enterprises. Jon Powers: Right. Ethan Zindler: So if you’re Apple and you’re putting pressure on all your suppliers to be green, then that can frankly, first effects the Foxconns, which are not small companies, but there are others further down the chain. I do think the influence of bigger companies will eventually be felt by smaller companies and entities. The only thing that I point out of course is that the good news is that this stuff is generally cost competitive. Yes, this may be new to you if you’re a small business or a small government agency, but the numbers can pencil out in many cases. If you take the time to do the work, you can figure out how it can work for you. Ethan Zindler: Even anecdotally, had started hear some talk of municipals and co-op utilities demanding more from more clean energy. These are frankly often, particularly the rural co-ops, have often been the ones that have been kind of most reluctant and resistant and even they are starting to see that it actually might be cheaper to buy clean energy than to continue to buy power from their very old, nearby coal plant. The good news is that the economics are on the industry side and eventually, everyone gets the memo. Jon Powers: Yeah. I would love to see your PPA overlay slide by the way. That sounds really fascinating. I want to ask one more specific policy question. I did want to get into the tools of the Factbook, which I think people should understand how to use it and what the work they’re going to be hopefully advocating for. But looking at specifically, we’re seeing now the step down in the ITC, pressure on the PTC you’ve talked about the electric vehicle taxes and some of the other sort of federal policies that have been in place that are starting to move away. What implication do you see maybe in that first phase down the ITC that maybe we will be a trend here for the next two or three years if we keep taking steps down, unless the government does reverse it? Ethan Zindler: Well, I don’t think that solar phase is quite the same level of pressure as wind does- Jon Powers: Yeah. Ethan Zindler: … in terms of… You haven’t historically seen quite the same kind of the peak, the classic PTC cliff in solar. It’ll be a great experiment. It may not be an easy one for a lot of people, but I would point out that our research from elsewhere in the world has pretty consistently shown that when the value of subsidies for solar are reduced, that the cap exes come down too. Jon Powers: Right. Ethan Zindler: I wouldn’t be shocked to see that happen here. There’s a substantial difference in the dollar per watt cost of a residential EV system in the United States versus one in Germany or Australia or other parts of the world. I don’t entirely frankly, understand why that exists. But I also do think that the removal of some of the subsidy will put a lot of cost pressure on US players, both residential, commercial and utility scale basis. Frankly, we’ll find out just how cheap you can do solar for- Jon Powers: Right. Ethan Zindler: … cheaper than we’re doing it right now. Jon Powers: Interesting. As someone who finances have started to see [inaudible 00:22:55], it’s great to see we can keep doing it cheaper and make sure the returns are there. Lisa, can you talk a little bit about the Factbook is such a great tool for folks that maybe aren’t full time evangelists or advocates or policy people, but that can go to their state capital and advocate for changes around some of the policies. Can you talk about some of the tools that the Factbook has that that can help them? Lisa Jacobson: Sure. Well, I think first and foremost, it’s all available for free and you can get the Factbook off the BCSE’s website. There are a lot of tools on the website that make it easy to navigate and we encourage everybody to check them out. Also, we’d like your feedback if there are things that you don’t see or ways to make it easier to find what you’re looking for, we would like to know. But you mentioned states. So one of the tools that I can mention is that we do spin off datasets for states. Maybe it’s like 10 different benchmark stats that we pull and we put them out on the website for free and individual state fact sheets. Every state has some additional information that you can gleam from the backup project. Then we also take out all the relevant state and regional data and we put that in one deck and we have that easily accessible on the Factbook website. Lisa Jacobson: So that gives you a sense of, when we’re looking on a more sector specific or cross cutting area and we have a breakout of state and regional information, all that is in one place. So if I were going to be going to a state capital, and you know BCSE does do this. For state X, I would go to the Factbook website and I would download that fact sheet and bring it with me. Or when I’m here in Washington and I’m going to an office in a particular state, I will bring that information with me. We use it a lot again, for pretty much all engagements we have, whether they’re policy makers or other audiences. The fact my book really is a cornerstone of our work because we think policy is best when it’s based on facts. Jon Powers: Yeah. Lisa Jacobson: Sometimes the trends don’t the way you want and you want to accelerate it or at least not see a deviation. Then there are times when things are just not going the way you want and you really need to ramp it up. All data, no matter what it shows is important data. Jon Powers: Yeah. Actually, we look at, give you a sense of how… We’ll look at it at CleanCapital. We actually look across the states and help identify for us, where the top targets are for the next iteration of projects that are going to be coming out. That type of data, there’s nowhere else we can really get it unless you’re really diving in and paying, nothing against Ethan’s business model, but diving in and paying BCSE or BNEF or others right now to do it. It’s really powerful and for advocates out there, it’s a great way to get your law makers sort of educated on what’s happening in the market. Lisa, one thing you did say is you talked about the fact side of this, I have applauded the fact that you guys have such phenomenal data and such fact based evidence. In this world we’re living in today where facts are becoming less and less relevant sometimes and the debate, how do you guys really amplify sort of the Bible that you’re bringing forward here, which is so powerful? Lisa Jacobson: I think the best way to do it, we are a business organization- Jon Powers: Yeah. Lisa Jacobson: … is let the businesses speak because I can go into any policymaker and say, “X technology is very affordable,” right? But when a business comes in and says it or the business says, “I’m a part of this transformation and I generate and create jobs in our town,”, ears perk up and people know that in many cases, even if they’re in the sector, it has to pencil out and they’re not doing it just on ambitions and hopes alone. They are doing it because they may share that passion, but they also know that it’s viable. So I think for us, that’s the best voice we can bring to the table. Now, we also have, as you know, Clean Energy Business Network under the BCSE banner, which is small and medium sized businesses, which I think in some cases, certain audiences are even more compelling- Jon Powers: Right. Lisa Jacobson: … because they really are community members. We know a lot of the updating of market rules that needs to occur really is at the most local level. Here in Washington, we have conversations. You mentioned our budget, our federal budget or on tax policy and that’s kind of really high up here at the federal level. But when you have to site community solar, farm, you got to get the community excited and involved. So having local businesses, which is what we can offer in addition to other community members participate in that conversation is really valuable and speeds change. Jon Powers: Can you talk about the business network for folks that don’t have the capacity to be, for instance, part of the core BCSE? How do folks sign up and become part of it? Lisa Jacobson: Yeah, I’d love to. Clean Energy Business Network is really easy. You just go to our website or there’s, www.CEBN.org, and you can sign up right there. They have lots of different programs. They offer business services, as well as engagement with policymakers in communities, as well as here in DC. There’s membership fees, but they’re very reasonable. Just to get basic information, they do every two weeks a newsletter, which is amazing. You get that for free. I think what they’re also trying to do in addition to promoting policy and educating on clean energy is build your business partnerships. So there’s a lot of networking that comes through the Clean Energy Business Network. I definitely would encourage anybody, and it really is very affordable, recognizing that small businesses, they’re worried about kind of keeping their operations going, but this is something that’s very affordable and very high value. Jon Powers: Is it an initiative of BCSE? Is it a program? What’s that… Lisa Jacobson: Yeah. It was started by Pew Charitable Trusts- Jon Powers: Right. Lisa Jacobson: … in 2008. Years ago, it transitioned from Pew to the BCSE. So it’s an independent initiative of the BCSE currently. Jon Powers: Excellent. That’s great. I did not even know about that. CleanCapital will be joining soon. As many of you should. Lisa Jacobson: Yay. Jon Powers: As many of you should. For folks that aren’t aware of BCSE, you can go to their website which is BCSE.org and find the Factbook there and all the tools that Lisa mentioned. We’ll have that linked at our CleanCapital website as well, CleanCapital.com. Is there any message you’d like to leave with with the audience before we sort of have you back next year to look back at actually, how the coronavirus affected all this? Ethan Zindler: I don’t know. I guess I would just say that at a point made earlier, but just the level of… The volume and the velocity of change in the sector is incredible and it is not looking like it’s going to let up anytime soon. Just being aware of where we are at this moment and also understanding those rates of change I think is important for anybody now involved in either policy-making or development or whatever because where we are now is it’s definitely going to be different from where we are two years, five years, 10 years from now. Getting the very latest information is really critical. That is one thing I’m very proud of about this Factbook is that we put it out as soon as we can into the new year about the immediate prior year because if you’re looking at data that is frankly, a year or two old, as you know, Jon, about even something as simple as the cost of a solar module- Jon Powers: Right. Ethan Zindler: … you can be really wrong. It’s really important to have very current data and information. Jon Powers: And Lisa, any thoughts? Lisa Jacobson: Well, just the audience that you have, all of the individuals and all the organizations and companies that listens to this podcast, you’re on the front lines and you mentioned Virginia. That’s just one example. There are many examples of change, but that happens because we all work together on a common goal. That’s where we got to be and we have some really ambitious essential objectives. We won’t get there if we don’t listen to each other, talk to each other and try to find a common path forward so that we can all succeed. The council is kind of a small microcosm of that ambition. We’re very diverse in terms of our business models and the sectors we represent, but we try to align and support each other. It’s not always easy, but that’s the premise. Yeah, I would just say look forward to being here next year hoping that what we’re experiencing in this very moment in time with the coronavirus subsides and we’re all able to focus on having good health and focus on other ambitions. Jon Powers: Yeah, absolutely. Well, first of all, thank you so much for taking the time today. I appreciate it as always and can’t wait to have you back next year. I sort of challenged the both of you guys now that you have almost a decade worth of data here and you didn’t turn this into a TED talk. It’s such phenomenal stuff. I use your data all the time when I’m speaking publicly because it does tell not just the facts, but a really incredible story about the growth of our market and really, the fact that we’re just in the beginning of this amazing clean energy revolution, so thank you. Lisa Jacobson: Thank you. Jon Powers: For our audience, you can get a copy of the Factbook at BCSE.org. I challenge you either to join BCSE or to join the Clean Energy Business Network so you can stay involved and utilize the tools and help tell the story of what’s happening both in your state capitals and in Washington DC. As always, please continue to listen and you can get more of our episodes at CleanCapital.com. Thanks to Carly Battin, our producer, and I look forward to continuing the conversation. Jon Powers: Thanks for listening in today’s conversation. Find more episodes on 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. We look forward to continuing our conversation on energy, innovation and finance with you. [/av_textblock] [av_social_share title=’Share this entry’ style=” buttons=” share_facebook=” share_twitter=” share_pinterest=” share_gplus=” share_reddit=” share_linkedin=” share_tumblr=” share_vk=” share_mail=” av-desktop-hide=” av-medium-hide=” av-small-hide=” av-mini-hide=” av_uid=’av-354olk’] [av_hr class=’invisible’ height=’40’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_button label=’More Podcasts’ link=’page,5266′ link_target=” size=’small’ position=’center’ label_display=” icon_select=’no’ icon=’ue800′ font=’entypo-fontello’ color=’theme-color’ custom_bg=’#444444′ custom_font=’#ffffff’ av_uid=’av-jx1x7jx3′ custom_class=” admin_preview_bg=”] [av_hr class=’invisible’ height=’40’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”]
Episode 62: Mona Dajani [av_image src=’https://cleancapital.com/wp-content/uploads/2019/03/podcast-image-pageheader2.jpg’ attachment=’4329′ attachment_size=’full’ align=’center’ styling=” hover=” link=” target=” caption=” font_size=” appearance=” overlay_opacity=’0.4′ overlay_color=’#000000′ overlay_text_color=’#ffffff’ copyright=” animation=’no-animation’ id=” custom_class=” av_uid=’av-jwwgyb48′ admin_preview_bg=”][/av_image] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwwgxszg’ admin_preview_bg=”] Episode 62: Mona Dajani [/av_textblock] [av_hr class=’invisible’ height=’10’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwl4lsb2′ admin_preview_bg=”] This week’s guest is Mona Dajani, partner and global leader of the Energy, Infrastructure & Water team at Pillsbury Winthrop Shaw Pittman. An international known deal maker in the renewable energy industry, Mona has advised on multiple acquisitions, dispositions, financing, tax equity, leasing and project development transactions involving energy and infrastructure facilities. Ms. Dajani also works with a wide array of commercial and public institutions, sponsors, private equity funds, sovereign wealth funds, utilities, investment banks and others in the structuring and negotiation of joint ventures, project contracts and financing connected to the development, financing and leasing of complex energy and infrastructure projects, equipment and facilities. Ms. Dajani was re-elected in 2018 to the Board of Directors for ACORE and has repeatedly been recognized as a leading lawyer by The Best Lawyers in America, The Best Women Lawyers in America, IFLR1000, Who’s Who” and other rankings. In this engaging episode, host Jon Powers explores Mona’s two decades of experience in the renewable energy space along with market trends and investor appetite for energy storage. [/av_textblock] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” font_color=” color=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” id=” custom_class=” av_uid=’av-jwwh5253′ admin_preview_bg=”] Listen now: [/av_textblock] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ id=” custom_class=” av_uid=’av-k4so2umi’ admin_preview_bg=”] [av_image src=’https://cleancapital.com/wp-content/uploads/2020/02/Email-podcast-bar-Dajani.jpg’ attachment=’7289′ attachment_size=’full’ copyright=” caption=” styling=” align=’center’ font_size=” overlay_opacity=’0.4′ overlay_color=’#000000′ overlay_text_color=’#ffffff’ animation=’no-animation’ hover=” appearance=” link=’manually,https://link.chtbl.com/SLlxMjUv’ target=’_blank’ id=” custom_class=” av_element_hidden_in_editor=’0′ av_uid=’av-k37p0z0j’ admin_preview_bg=”][/av_image] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwwh5253′ admin_preview_bg=”] Full transcript: [/av_textblock] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwwh5253′ admin_preview_bg=”] Jon Powers: Welcome to Experts Only Podcast sponsored by CleanCapital. Learn more CleanCapital.com. I’m your host, Jon Powers. Each week we explore the intersection of energy, innovation and finance with leaders across the industry. Thank you so much for joining us. Jon Powers: Welcome back to Experts Only, honored today to have Mona Dajani on, who is a global leader and a partner in the energy infrastructure and water team at Pillsbury Winthrop Shaw Pittman, both in their New York and London offices. I asked Mona to join us after reading an article that she recently wrote in GreenTech Media, where she talks about some of the challenges in underwriting and understanding energy storage as an investment. Something I think many folks in the market are talking about today. Mona’s got experience seeing multiple deals in the renewable space over 20 years, has advised multiple acquisitions, financing. She serves on public boards, like the American Council on Renewable Energy, as well as been ranked as one of the best leaders in America. Mona will help guide us through some of the challenges that we’re seeing today in energy storage and help me and hopefully you as well better understand the frame that we should be looking at this market, not just today, but over the next 10 years. I hope you enjoy. Mona, thanks so much for joining us at Experts Only. Mona Dajani: Thank you very much for having me on your show. Jon Powers: You have an absolutely fascinating background, before you ended up doing the work you’re doing today at Pillsbury. I want to talk through your, I would call your origin story. How did you decide to get into renewable energy? You’ve been in this space for almost two decades and really have helped shape how the market’s developed and really diving into the deal side, which is somewhat unique over time. First let’s step back and say why renewable energy, what got you interested in that space? Mona Dajani: There were a variety of reasons, but probably the biggest one was I find it very interesting and challenging. And I feel that I’m also giving back to the world and hopefully leaving it in a better place after I leave. Jon Powers: That’s great. That’s great. Was it renewable energy first or law first? What was your path into the merger of those two careers? Mona Dajani: Well, I, many years ago as right out of college, I worked at Enron in Houston, so I was doing energy. I also have an engineering degree, so I was doing energy and then I started going more into the corporate. And then I married the energy with the law, and along the way got an MBA. And I really was just, I really loved putting deals together in the space where there was a lot of different challenges and different challenges. And it was a very, a new market, a new frontier. And I was very excited to be part of it and be a pioneer in its development, both from a financial/legal/policy point of view. Jon Powers: Interesting. I mean, you’ve got to really be able to tackle all of those different challenges when you get into renewable energy. Because looking at whether it be state by state or global versus domestic, there’s no just out of the box market we’re living in. It’s piece by piece per deal. But I do want, because you’ve been in it for so long in a very positive way and seen it progress, as you’ve begun to grow in this space and see these deals come together, what are some of the trends that you have really began to see in the DG market that have changed from where we were, say 10 years ago? Mona Dajani: Let’s see. I think that … well, first of all it is, I’m very excited to see that renewable energy has outpaced coal. And that’s very exciting. And that wind and solar have accounted for more than 50% of total us renewable power generation, which I like. I like that there are declining costs and rising capacity factors of renewable energy sources, along with increased competitiveness of battery storage, drove growth. I’m seeing levelized cost of onshore wind and utility scale solar have declined, along with offshore wind. I’ve also seen a great decline in lithium ion battery storage. And this decline in battery storage has begun to really start making an indent on renewable and making intermittent wind and solar increasingly more competitive with traditional dispatchable energy sources. Mona Dajani: I saw significant demand from a lot of different market segments, as well as overall consumer sentiment remaining positive. I’ve seen renewable energy consumption increasing and also industrial consumption as well as US corporates getting into renewable energy and power purchase agreements. I think I saw more than a 5.9 gigawatts in the first half of 2019 last year. Jon Powers: Yeah. It’s amazing the leadership we’re seeing out of corporate America in this space. Mona Dajani: Yeah, it totally is. I’m seeing a lot of that it’s just very bullish. I think that we’re watching the tariff, what’s going on in China. Solar developers are optimistic. So, that’s really great. I think that the cost competitiveness has really been huge in this space. And the rapidly declining renewable energy costs and the maturation of energy storage are really enabling renewables to compete and replace coal and AG, gas and nuclear. Jon Powers: Let me ask you, putting your legal hat on. Pillsbury’s one of the leading firms in the country helping to manage some of these acquisitions. And as we’re getting more into these complex, it’s no longer just a pure solar PPA. There are still pure solar PPAs, right? And wind PPAs. But now we’re looking at incorporating … We’ll talk more about storage here in a second. But the deal’s just becoming even more complex. Right? And you’ve got a lot of folks out in the market who will claim to be experts on things like solar power storage. But it’s hard to be an expert on something that didn’t even exist five years ago. So, what are you seeing from the legal acquisition side that has be developing in the market? As I imagine you’re seeing probably more competition of folks who claim to be able to do what you guys can do. Mona Dajani: Yeah, I mean, look, there’s definitely much more competition. Because like anything else, they see more opportunity. But this space still is very small. There are a handful of really constants who are utility scale developers. There are usually a small number of tax equity investors that expand and shrink depending on where we are in the market. And I also see that there’s a lot more complexity. You know the expression that they say, “You don’t know what you don’t know.”? And it really, I see it when either a lot of money is spent on a deal that doesn’t close because they fail to see some of the red flags at the beginning of the deal that they should have. Mona Dajani: Or the other thing is, I see is that something happens, which is inevitable. I was working on a deal recently where there was a credit rating change. And the inexperienced don’t know how to deal with that. And it’s just easiest to just kill the deal and move on. And that’s not really economical. It’s not cost effective or efficient for anyone in this space. And it’s very much a relationship-driven space. I’ve been in this space, as you noted, for more than 20 years. I know a lot of the C level people, not only in the United States, but abroad. In Asia, in Europe, a lot in Europe, in the Middle East. And we also help put deals together and structure them. Mona Dajani: And if we have some kind of hiccup, we’re able to talk to all the sides, depending on which. Side you’re on. But I mean the bankers, the tax equity, if there’s any, the buyer and seller, and try to come up with a way to make the deal work, if it makes sense. But usually it’s very, I see a lot where … And our difference is that we know the industry, we know the people, we know the nuances of the different technologies. We also know and we’re willing to introduce new financing mechanisms and trends, new ways to close a deal. And a lot of it depends on the relationships that you have and the trust. Jon Powers: Yeah, absolutely. You’ve done a really great job getting out from behind your desk at a law firm and spending time, for instance, in the board of directors of ACORE, right? And engaging the media. What have those experiences taught you, not just about the market, just in as a leader, about getting involved with the broader discussions that are happening around the space? Mona Dajani: Well, I think that first of all, I enjoy getting out there and meeting people in our industry and working with them. I enjoy it. I love being on the board for ACORE, it’s an organization. As you know, I’ve been reelected. I’m the only attorney, as well, on the board. Everyone that’s on the board is a recognized like market leader in renewable energy, barring none. I mean, if you look at it and see the people on there, it’s just the top. So I’m very privileged to share the board, all the members of the board and to hopefully shape the direction of ACORE, which has been a tremendous organization under the leadership of Greg Whetstone, amazing leader. And other people within the ACORE organization that support ACORE to really be an international leader in the space. Mona Dajani: And it’s not only, ACORE is not only an organization to network, but also look at what cutting edge industry trends. Because they’re happening right there at the board. I’m watching it happen or sometimes creating it. And that’s really truly very exciting. And ACORE has also been responsible for policy as well at the federal level, as well as the state level at certain states, with respect to really promoting all forms of renewable energy. Jon Powers: Yeah, I mean I think ACORE is uniquely seated compared to the other industry groups that have their singular vertical focus, right? Whether it be the solar industry or wind or the Energy Storage Association. Greg has really helped ACORE look across the different verticals. ACORE, to their credit, was one of the first ones with that, what was it called? The Renewable Energy Finance Forum, I think, really to bring the finance piece into the conversation in a unique way. Mona Dajani: Right. It’s absolutely critical, the financing piece. You have to understand that piece to accelerate and unlock capital for renewable projects or they’re not going to get done. Jon Powers: Exactly. Exactly. Mona Dajani: Yeah, so … Jon Powers: I do want to dive into a little bit of meat here, specifically around energy storage. So the trigger for this conversation was a phenomenal piece you wrote in GreenTech Media in December, Challenges Remain in Understanding Energy Storage as an Investment. I saw the article and realized I wanted to dive deeper into this with you. Because for me I’ve seen storage as a holy grail for DG for the last decade. And we’re now only seeing it come to the market in real scale, but not without significant challenges. People on this podcast have talked about energy storage being similar to the solar market 10 years ago. But as you pointed out in your article, it’s just more complicated than that. Jon Powers: It’s not as simple as a 20 year off take and you produce X and you pay Y. Because there’s a bunch of different business models and policy implications to batteries and how you manage that. So starting off, how are you involved in the energy storage market on the deal side? And what are some of the current trends that you’re seeing today as the market’s really begun to develop? Mona Dajani: Yeah, so what I do, what I’ve been doing a lot is … there’s a lot of industry demand for 100% clean energy. Jon Powers: Yeah, absolutely. Mona Dajani: And as I said in the article, that has really pivoted our market. And now you’ll see corporations whereby they want to be in this space and economics, profit, is actually secondary. And they’re more focused on the ESG and really committing to clean energy, sustainable energy, et cetera. So what I see is a lot of … what I do, is I will put the deals together. Usually there’s different parties to the transactions that are already in discussion. And then I help crystallize how the deal could look like. And then I will, depending on what side I’m representing, because it really does vary whatever side I’m on. Mona Dajani: But at the end of the day I think everyone has the same end point, which is to finalize the deal. But having either storage, either as a standalone asset or by adding it to an existing power source is very individualized. And there’s different risks and returns from every project that’s different. Because you have to understand how each project deploys power. That’s highly variable. Some are able to generate income, while others can charge and deploy energy, while others just deploy. And then there’s interconnection considerations and co-location as well. So it’s very … you have to understand the intricacies of the ultimate project, the asset management of it, to mitigate the risk and to optimize as much as you can, the full potential of the investment. Jon Powers: And are you seeing … so you mentioned in the article, specifically the Orset Project down in Texas, which is, I think if I read it correctly, over 400 megawatts. Are you seeing more utility scale solar plus storage today coming through the deals? Or are you beginning to see stuff happening at the commercial industrial DG level as well? Mona Dajani: I’m seeing a lot in both utility scale and DG. And also with, they call it digital infrastructure. Data centers and bundled with cell phone towers, as well as … they’re calling it digital infrastructure. What I introduced, what I wanted to show in the article was just a couple big ones. Because I thought that would be more attention grabbers. Jon Powers: Yeah, of course. Mona Dajani: Because people have heard of them, because people have heard of them. But there is quite a bit also in the DG space and there’s a lot that we haven’t heard about. I mean, I just picked two that I know that people would have heard of. Jon Powers: Yeah, no, absolutely. That’s why I raised it because I feel like it’s more than just the utility scale. And I think one of the challenges, I think you talked about the current costs versus the resiliency energy security paradigm that they’re trying to solve, whether it be data centers or cell phone towers. In these deals, as they’re coming together, putting my hat when I was at Bloom a few years ago before starting to Clean Capital, and it was often that the off taker, the end user would want the resilience but didn’t understand how to cost it into the, for instance, the price per kilowatt hour. Right? So then comparing that to what they had today, just from the utility, are you seeing those off takers becoming more mature in their ability to analyze that almost energy is a storage package or energy as a service package? Mona Dajani: Yeah, I mean we’re still in the infancy stages. I mean, I will tell you that when I first started doing this for my first wind project over 20 years ago, everyone was afraid of construction risk. And no one would take that risk and now it’s so mainstream, everyone wants to take it. So what I’m seeing a lot in energy storage is a focus on the technology. And that’s why there’s a heavy emphasis on the digital infrastructure. So those that can understand that. The technology, understand that it is a cost competitive source of supply. And if they can understand the total value stack. You really need to understand finance, you need to understand power, you need to understand the how of what the technology is to store enough electricity to capture the renewable wind or solar generation. So it’s certainly poised for accelerated growth. But I still think that it’s almost, it’s like offshore wind, which is that- Jon Powers: Oh, interesting. Mona Dajani: At least here in the US, not in other areas, in other places. Here in the US it’s still in its infancy. So I think that you can see black and white data points in connection with costs, but a lot of the value stack is still, and what makes sense to make a project successful is not as cut and dry as it would be for solar or wind. Jon Powers: Yeah. Well, can we run with that technology chain for a second? Because I feel like there is a misunderstanding as people are starting to wrap their head around storage, where you’ve got the STEM’s and the AMS’s of the world, who are really a software solution. Right? Trying to financially maximize the deployment of the battery, whatever the battery is. Right? Because then there’s the technology of the actual hard battery. Whether it be a Tesla battery or lithium ion or some of the other ones that are being developed around the country. Are you seeing people being able to separate out those different technologies? Or do they see it as a package? Do they risk it differently? Because I think people, it’s getting to be hard to finance … it’s still hard to finance some of these because people don’t know if the company behind, whether it be the technology, whichever one you choose, is even going to be here in five years. Because a lot of them were startups only five years ago. Mona Dajani: Right, right. Exactly. Jon Powers: Yeah. So how are you getting, how do you see … Maybe I should maybe ask it more directly. How are you seeing folks in the finance industry getting more comfortable with those different technology risks? Or are they getting comfortable? Mona Dajani: I think that they are, there’s technologies that support energy storage. And I think the trick is what are the favorable energy storage technologies? And I think that that’s tough. I think that it really depends on … they come in different forms. The key commonality is to draw electric energy from the grid on command and discharge most of this energy back to the grid at a later time. And this ability to flexibly move the energy across time, is a tool that can be applied in many different applications. But a lot of this depends on what is the balancing supply and demand? And is this done on a hourly basis? Is there a buffering power flow? Do we need to store energy for downstream capacity? Mona Dajani: So it’s energy storage technologies have different systems that can do this and store and hold. And they vary in terms of what they can hold, how they can hold and the time over which they can store without significant loss. And some can operate at a grid level, absorbing the surplus energy from the grid and then delivering it back. And some can operate at the consumer level. But it’s just, you’ll notice that, which I found interesting that a lot of the different energy storage technologies, the company will usually focus on one segment. Whether it’s a flywheel system or whether it’s a battery system or whether it’s just using lithium, which I find interesting. You know what I mean? Jon Powers: Yeah. Mona Dajani: So I think that batteries for example, they’re usually analyzed together as super capacitors. They have high energy density, but low power density storage media. And that’s why super capacitors are mainly used in hybrid renewable energy storage media to support other storage media, like lithium and sodium sulfide and zebra and nickel and led assets. These are different dimensions for renewable energy use, that is based on the, like I was talking about, the life cycle. So, it’s very difficult to … I would tell you, like with energy storage, like with ACORE, I don’t want to focus on a particular technology. I want to be agnostic about the energy. Because it really is very much a project-per-project basis. And of course like Tesla is going to support Tesla. It’s just different. It’s just very different. And it’s just based on what the application for the energy storage is being used for. Jon Powers: Yeah. It’s just making it harder to actually be able to finance at scale. Right? Mona Dajani: Right. Jon Powers: Where it’s just unique. Mona Dajani: Right, right. And I would just say what’s critical from a financing perspective is that they need to be … to be financeable, they have to have some kind of, we need to know that a technology works. It’d be great if there was more than a pilot project or that there was enough successful projects that use this type of technology. That is something we like to see. Because that tells us that there’s bankability on this. It’s not so new that we’re taking technology risk. Because that’s what we want in financing and bankability, is we want certainty as much as possible. Jon Powers: Where do you see, just looking ahead now, right? If you can pull out your crystal ball and look out to … We’re at 2020, the launch of a new decade. If we looked back in 2030 at where the storage market is, and I’d say maybe the renewable market as a whole, where are we going to be in 10 years? Mona Dajani: I think that there’s going to be further growth, I’ll just speak in general, in the renewable energy sector, in the technologies. I think that there’ll be increased innovation and collaboration among multiple different, and sometimes completely unlikely stakeholders. I think that we are going to continue to be moving renewables in the electricity markets as utilities and regulators prefer clean energy to replace retiring old dirty power generators and to choose to save costs as well as addressing climate change concerns. I think that there’ll be a growth in US offshore wind sector. I think that’s a new area for us here in the United States, which we’re learning from our European counterparts that are here now. Mona Dajani: And I think that will bring multiple opportunities for industry players and for manufacturing and for port infrastructure projects. I see a lot of grid resiliency will be also a growing driver for renewable deployment, as utilities and their customers will demand renewable energy to be combined with storage solutions. There’s still some, as we know, although it’s starting to, the fog is starting to clear. There’s still trade tariff and administration policy concerns that will keep the industry, we’ll be on the lookout. But I do see a lot of people- Jon Powers: Yeah, that’s right. I mean, looking at 10 years from now. I feel like hopefully we’ll have smoothed out of the rollercoaster of the last four years. Right? And even if there was another four years of this, the growing trends are still supporting the market here, which is great. Mona Dajani: Yes. And I see that technology is absolutely key, in addition to capital AND financing here, to having this grow. But it looks like … I’m very, I’m bullish and I see a lot of new opportunities and I see that this is just a new phase for our industry that is on an upward trajectory. Jon Powers: That’s great. So I’m going to completely change topics here for a second and end with a personal question. You are a, not only leading deal maker in renewable markets, but you’re also a trained chef and sommelier, who as I understand, can open a champagne bottle with a saber. How did that happen? How did that happen? Mona Dajani: I’m one of those people where I live life to the fullest. And I love to cook, I did go to cooking school. It’s very relaxing for me and another … Very close to eating very well and cooking is wine, which changes the taste of fat and salt basically from the food that’s in your mouth. So I became a sommelier in wine and I also have about … and there’s quite a number of people in this space that have seen it. I have a saber, a saber is a special knife. I had one that was handmade for me as a gift, as a working gift. And it’s about maybe two and a half feet and I use it to slice off the top of champagne bottles. And there’s a whole trick to that, but I did go to the hospital a few times on my hand. Jon Powers: Yeah, I was going to ask about your fingers. Mona Dajani: That’s another podcast. That’s another podcast. But I do have amazing closing dinners that I personally will be the chef de cuisine. And I do wine tastings and I sometimes, not all the time, bring my saber. Depending on where we are. And sometimes I’ll bring my saber also when we’re at the end of a deal and we have to … You either sign or we’re going to a saber on you. Jon Powers: You’ll lose a finger. Mona Dajani: It’s a prop. It’s a prop. It’s a funny prop. Jon Powers: I love it, Mona. Mona Dajani: So yeah, so I love it. So, yes. Jon Powers: For our listeners that will replace our standard end of interview question. I think that’s a really interesting thing. And Mona, some other time at a conference over drinks I’ll tell you, when I first moved to Washington DC I actually lived in the wine cellar of a woman who founded the Christie’s Wine Auction. And literally that was my … I was starting a nonprofit, had no money, so she let me sleep in a cot in her wine cellar for a summer. It was a very educational for me. So, awesome. Mona Dajani: That’s awesome. Wow, great. I’d love to hear that story. Jon Powers: Well Mona, thank you so much. So much great information. For folks that are not familiar with the article we mentioned, you can go to Green Tech Media and pull it up. It’s, Challenges Remain in Understanding Energy Storage as an Investment. We’ll link to it from our website, CleanCapital.com. As always, you can get more podcast interviews and suggest folks we should be talking to at CleanCapital.com. I want to thank our producers, Lauren Glickman specifically, for her help setting this up, and Carly Baton, who helps us a Clean Capital. We look forward to a future conversation, Mona. And I was really honored to have you on here today. Mona Dajani: No, the honor is mine, thank you so much. This has been really fun. I appreciate your time. Jon Powers: Thanks so much. And for our listeners, as always, good to CleanCapital.com To learn more and I look forward to continuing the conversation. Jon Powers: Thanks for listening to today’s conversation. Find more episodes on 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. We look forward to continuing our conversation on energy, innovation, and finance with you. 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Episode 61: David Sandalow [av_image src=’https://cleancapital.com/wp-content/uploads/2019/03/podcast-image-pageheader2.jpg’ attachment=’4329′ attachment_size=’full’ align=’center’ styling=” hover=” link=” target=” caption=” font_size=” appearance=” overlay_opacity=’0.4′ overlay_color=’#000000′ overlay_text_color=’#ffffff’ copyright=” animation=’no-animation’ id=” custom_class=” av_uid=’av-jwwgyb48′ admin_preview_bg=”][/av_image] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwwgxszg’ admin_preview_bg=”] Episode 61: David Sandalow [/av_textblock] [av_hr class=’invisible’ height=’10’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwl4lsb2′ admin_preview_bg=”] This week we speak with David Sandalow, Inaugural Fellow at the Center on Global Energy Policy and co-Director of the Energy and Environment Concentration at the School of International and Public Affairs at Columbia University. He founded and directs the Center’s U.S.-China Program. Sandalow has served in multiple senior positions in the government at the White House, State Department, and most recently the U.S. Department of Energy. Prior to his role at the Department of Energy, he was a Senior Fellow at the Brookings Institution. This conversation centers around Mr. Sandalow’s 2019 Guide to Chinese Climate Policy and the pivotal role China plays in the solution to climate change. [/av_textblock] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” font_color=” color=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” id=” custom_class=” av_uid=’av-jwwh5253′ admin_preview_bg=”] Listen now: [/av_textblock] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ id=” custom_class=” av_uid=’av-k4so2umi’ admin_preview_bg=”] [av_image src=’https://cleancapital.com/wp-content/uploads/2020/02/ExpertsOnly-Sandalow-bar.jpg’ attachment=’7274′ attachment_size=’full’ copyright=” caption=” styling=” align=’center’ font_size=” overlay_opacity=’0.4′ overlay_color=’#000000′ overlay_text_color=’#ffffff’ animation=’no-animation’ hover=” appearance=” link=’manually,https://link.chtbl.com/nW12MBiA’ target=’_blank’ id=” custom_class=” av_element_hidden_in_editor=’0′ av_uid=’av-k37p0z0j’ admin_preview_bg=”][/av_image] [av_hr class=’invisible’ height=’20’ shadow=’no-shadow’ position=’center’ custom_border=’av-border-thin’ custom_width=’50px’ custom_border_color=” custom_margin_top=’30px’ custom_margin_bottom=’30px’ icon_select=’yes’ custom_icon_color=” icon=’ue808′ font=’entypo-fontello’ av_uid=’av-jwwgzkyu’ custom_class=” admin_preview_bg=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwwh5253′ admin_preview_bg=”] Full transcript: [/av_textblock] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-jwwh5253′ admin_preview_bg=”] Jon Powers: Welcome to Experts Only podcast sponsored by CleanCapital. You can learn more at cleancapital.com. I’m your host Jon Powers. Each week we explore the intersection of energy, innovation, and finance with leaders across the industry. Thank you so much for joining us. Jon Powers: Welcome back to Experts Only podcast. This is Jon Powers your host. This summer we saw records soar and break around the globe, not just here in the US, including in China and today we have a really interesting guest, David Sandalow who’s from Columbia Center on global energy policy and he just published a guide on Chinese climate policy. He served as the under secretary of energy at DOE but now as a fellow at Columbia and working across the university but also spending a lot of time teaching in China as well. The 2019 guide to Chinese policies, it’s an updated report on China’s climate change policies. The report covers information on Chinese emissions, impact of climate change in China, the history of China’s climate policy and its policies response today. It was first published in 2018. This is an updated version and I think you’ll see in the conversation today, there’s a lot happening overseas and a lot of opportunity if you can figure out the market. So we look forward to the conversation and we’ll get started. David, thank you so much for joining us on Experts Only podcast. David Sandalow: Thanks for having me, Jon. Jon Powers: You’ve had a really illustrious career in government working in academia, focused on a variety of really critical global issues. And I want to get into those and get into what’s happening in China and talk about the report. But first of all, how did you even get interested in China? David Sandalow: So I’ve been interested in China since I was a kid and when I was young, when I was in high school and in college, it was impossible for Americans to travel to China. Just to date myself. Back in that era, the two countries did not have diplomatic relations, you literally couldn’t go there. And then in the late ’70s we establish diplomatic relations with China, the United States. And when China started exchanging people in a variety of different walks of life and I started looking around for a way to get to China and looking for a exchange program that I could join and the internet didn’t exist back then, but I looked around and I ended up with a … I was in law school at the time and I found a program run by Columbia law school and Columbia sent a group of students over to Shanghai in the summer of 1981 and it was just an extraordinary experience. David Sandalow: It was a very different Shanghai than the one that people visit today. That summer there was exactly one international telephone line in the entire city of Shanghai. It’s just remarkably different. But it was fascinating and I’d been interested in China ever since. Jon Powers: And this was basically less than a decade after Kissinger had gone over and really started to open- David Sandalow: Yeah, that’s right. The Nixon Kissinger diplomacy happened in the early 1970s. It was 1978 when Jimmy Carter and Deng Xiaoping normalized relations between the two countries. And so then I, as I worked on energy and environment, which was my principal career interest, I kept on looking for ways to engage with China. And in the 1990s I had the privilege of working on the White House staff and the national security council staff and was able to travel with President Clinton to China in 1998 and help organize an environmental event that he did as part of his trip to China and worked on issues around climate change in China during that period as well. David Sandalow: And let’s see, then just carrying it forward. I spent a big part of the decade after that at the Brookings Institution in Washington DC and wrote some reports and monographs on the United States and China and climate change and how we might work together. And then I had the honor of going into the Obama administration and trying to implement some of the ideas that I been recommending and I was … In the Obama administration, I was at the US Department of Energy in couple of different jobs, but my main focus during those years was on China and I traveled 14 times, I guess in four and a half years to China working both on disagreements in the relationships and the agreements in the relationship. And there were both and we built up a strong architecture of cooperative programs on clean energy and climate change and also managed some pretty serious disagreements during that period as well. Jon Powers: How much of that work was focused on the energy side versus the climate change work? David Sandalow: Pretty intertwined. Jon Powers: Yeah. David Sandalow: I was a climate negotiator in the 1990s, very deeply involved with the climate negotiations. The 25th conference of parties in the climate change negotiations are coming up in Santiago, Chile this fall. I would say US … I was a White House official at the first conference of parties for the climate change convention, which was held in Berlin in 1995 so I’ve been doing these climate change negotiations for a long time and was involved from my energy department perch some during the first Obama term and we were working with China both on climate negotiations, but more from the energy department, more directly on energy cooperation. Jon Powers: So in parallel you’ve got this China interest that’s blossoming and it’s really run a track in your career. What interests you in climate and energy? David Sandalow: I started as an environmental lawyer. I’d always been interested in the out of doors. Early in my career, I spent time at the environmental protection agency as a clean air act, the clean water act lawyer and then during the Clinton administration got detailed over to the White House and then never went back. Then was hired over at the White House and have been doing policy work ever since. And at the White House, I had the privilege of spending a lot of time with Vice President Gore and with President Clinton working on climate change issues. And that’s what really sparked my attention and focused me on the importance of energy issues and from there got into energy issues. Jon Powers: Yeah, I mean, so having been tackling this for over 25 years we’re coming to the tail end of a summer that had not one but two presidential forums on climate. We had these worldwide strikes led by an amazing teenager coming out of Sweden. Incredible climate discussions that happened last week in New York. I’ve been talking a little bit on this show about how I think we’re living in a bit of a climate moment that’s a little bit unique, but you’ve been working at this for 25 years, building the momentum. How do you gauge where we are today to where things have come in the last two decades? David Sandalow: Jon, I think you’re exactly right and there’s good news and bad news. The good news is that the attention has never been greater. I mean, just in the past couple weeks we’ve seen demonstrations all around the globe. Unprecedented level of attention in the media. Certainly in the US political process, there has never been more attention than there has in the past year. I mean, listeners to this podcast are probably familiar with the fact that there were no questions asked about climate change in the 2016 presidential election debates and now it’s really become one of the major topics of attention, certainly in the democratic primary dialogue. So that’s the good news. The bad news is that the action is not catching up, not yet caught up with the attention and we need not just attention but action. And the UN climate summit just last month, the commitments from national governments were very disappointing and we are way, way off track in solving this problem on the current path. We’re going to be in very serious trouble as a planet, as a result of all these heat trapping gases that we’re pouring to the atmosphere. Jon Powers: Yeah, it’s a fascinating and challenging time. And so I think one of the interesting trends here in the United States is the detractors often say that we don’t have to act until India or China acts. They use them actually quite often. But I think what your report shows is that China is actually acting. How do you empower folks here at home to push back on those type of attractors? Like what are some of the really interesting, and we’ll talk more about the findings here in a second, but is there any interesting stories that you grabbed from your research that can help people combat the detractors here at home? David Sandalow: Well, let me just start with the basic fact just for any listeners who may not know, that China leads the world in emissions, of pre trapping gas last year more than in the US and Europe combined. So there is no solution to climate change without China playing a very important role. On your question, the Chinese government is taking some very serious steps that are addressing climate change, and I talk about this in my report and let me just list them in a minute. The same time the Chinese government has policies that are not helpful when it comes to fighting climate change. So it’s not surprising the biggest country in the world would have a complicated and multifaceted set of policies, but anybody who says China is doing nothing is getting it exactly wrong. The Chinese government is doing a lot to fight climate change and one critical distinction between Chinese government and the US government, in this regard, there are no known climate deniers in the Chinese government. David Sandalow: And certainly none with any observable influence on policy. In fact, in the 2016 period I had a number of Congress patients in China with people who at some level I could tell they were just deeply skeptical that the United States was going to be run by somebody who didn’t believe in the science of climate change. That didn’t compute for them because there are literally tens of millions of Chinese who are looking for opportunities to come study in science and technology issues in US universities that the respect for US science and technology runs so deep in China. The notion that we might be run by somebody who didn’t believe in the science, it didn’t quite compute. Now I think people understand that in fact that’s the case. Jon Powers: Right. So let me ask you a question. Is a lot of the, and we’ll talk more about what they’re actually doing, but is a lot of it driven by just that core belief in the science or is there a cultural movement happening there because of some of the environmental impacts of their growth? How does it all come together? David Sandalow: So, yeah, I think there is a basic respect for science and scientists, which in my experience runs very high in China. I witnessed this. I worked during the Obama administration for secretary Steven Chu of the energy department who was a Nobel prize winner in physics and I got to see the respect, that really extraordinary respect, that he received in China for that. Of course, respected everywhere for that, but I think there’s a particular quality of respect for science and technology and leaders in science and technology in China. At the same time as you were just suggesting, air pollution problems are extremely vivid in China. China has just horribly polluted air in some cities, in many cities. And it’s a major political issue in China. In some ways, similar to what it was in the United States in the 1960s and 1970s. I actually talked to somebody recently who older than me, he is retired, but he was telling me that when he used to go to work on wall street in his 20s he would bring two white shirts with him because the air was so polluted that his white collars would get dirty. David Sandalow: I think it’s extraordinary success story in the United States, how we’ve cleaned the air in our cities and I think the Chinese government is trying to replicate that success. It’s going to take them awhile, but they, the number of policies in place to do that and including in particular phasing out the coal, which heats much of Northern China and replacing it with natural gas and with renewables in the power sector. And so this is a big issue in China and it’s getting the attention and this has very positive impacts on the fight against climate change as well. And if you read Chinese material about climate change, they identify the transition away from coal as a key part of that. Jon Powers: So I think there is a lack of understanding here in the US about just Chinese infrastructure as a whole or we’re living on a grid that’s been around for decades. China is now on the tail end of 20 plus years of incredible growth of course, but they didn’t have even a national grid, right? They had a series of grids, they’re patched together and it’s actually provided them an opportunity with distributed generation and to grow but also challenges, right, in how they move the power across the country. Are you seeing the demand for renewables driven there more by just the need for electricity or is it government mandates that are pushing these things forward or like here in the US where we have the Walmarts and Amazons and others really clamoring for it? David Sandalow: I think policy’s been the major driver in China and the Chinese government has had very strong incentives for the deployment of renewable power over the course of the past decade. Last year, once again, China led the world in deployment of solar power. 45% of the panels deployed globally in the world were in China. China led the world again in wind power- Jon Powers: 45%- David Sandalow: 45% of the solar panels in the world were in China last year. Yeah. And by the way, more than half of the electric vehicles sold in the world last year were in China. So the commitment is strong. Now the Chinese government is in the process of changing its renewable energy policies. They’ve had pretty generous feed-in tariffs and they are switching over to an auction system. And one of the most interesting developments is in this auction system, if solar power can come in lower than the benchmark price for coal, it gets land allocations and other types of benefits. And in Western China and in just the past year for the first time we’re seeing bids for solar auctions coming in at less than the benchmark price for coal. Jon Powers: That’s amazing. So do you see that governance system they have, we’ve haven’t really talked about this yet, but we did offline. For folks that aren’t aware of the central government designs, these five year plans and has a obviously a pretty centrally managed way of approaching things like the climate and energy or any really policy, which is obviously in our day and age in the US hardly imagine a federal energy policy coming out right now. Has that strengthened the execution, but has it hurt innovation or are we sort of misreading that? David Sandalow: So the Chinese system has both strengths and weaknesses when it comes to fighting climate change. I think its biggest strength is the one you just pointed to, which is the planning process, which is so different than anything we do here in the United States. The Chinese government is on its 13th five year plan right now. It’s preparing for its 14th five year plan. And these plans very much shaped government policies. They don’t always hit every five year plan target, but everybody in the bureaucracy is charged with trying to hit those targets and they have very significant impacts on what the Chinese government does. And then in addition to these five year plans, they have these incredibly long term goals. The Chinese government has a 2049 goal of becoming a prosperous middle-class society by 2049 and it shapes policymaking and it affects the political value. Here in the United States, when we pass a one year appropriations bill, it makes headlines and everybody celebrates. I mean it’s a real difference and we just don’t have anything like that. David Sandalow: And when you’re talking about an energy transition, which is what we need to fight climate change, that type of planning I think is very helpful. Now there are some real issues in the Chinese system that cause problems. One of them is their implementation culture is not nearly as strong as ours is and in the United States, once we pass a law, we have pretty good mechanisms for enforcing it. In China there tend to be more ways for people to avoid compliance and so that can be a problem. Corruption has been a problem. Their statistical systems are not as good as ours. So there’s some strengths and weaknesses. I elaborate on this in the book, but there’s some strengths and weaknesses in the Chinese system when it comes to fighting climate change. Jon Powers: So as you look at what the Chinese are doing there’s obviously the current administration, there’s a clear trend of demonizing China, the push on tariffs and all the risks and challenges that we face doing work with them. Do you see like what … How has their response been to that message? Obviously not from a geopolitical perspective, but from a climate and energies perspective, one and then two, is there still a lot of opportunity to collaborate or is that starting to get shut down by the broader narrative. David Sandalow: So the trade wars had a negative impact on the fight against climate change. I mean, actually not just in China, but in the United States. I mean, the first tariffs that were imposed were actually on solar panels, I guess in washing machines at the same time. But that tax on Americans buying solar panels that President Trump imposed has hurt the solar industry here. In China, I think the leaders have focused far more on economic stability and energy security as a result of the trade war. And in some ways that aligns with climate change goals. Well one way for example is there’s been a very strong push on electric vehicles and part of that, the big part of that, not the only part, but a big part of that is the energy security aspect of being concerned about their dependence on oil imports. David Sandalow: And it’s also good from a climate change standpoint, but I think climate change is received less priority as a result of the focus on some other issues in the past year or so. I think there remain very strong opportunities for cooperation for sure. I mean this is a period of really enormous tension between the US and China politically and I think that’s going to shape the relationship for years to come. But this is an area that kind of clean energy and environment that has been a good area for cooperation in the past and it’s got tremendous opportunities to do that in the future. And in fact, not just in the future, it’s happening right now. It’s happening mainly at the sub national level right now. The state of California and some other states, state of Washington have some very strong bilateral cooperation programs right now. So there’s a fair amount of activity going at that level between the US and China. Jon Powers: As you pointed out in the book, right, 43% of the world’s new renewable energy capacity is coming online in China. So if you’re here in the US and looking at that as an opportunity as a market that maybe you should … you or your company should enter into, what advice would you give to those entrepreneurs or even the more mature investors that are looking that maybe not have entered that market before? Because it can be obviously clearly pretty challenging, right? David Sandalow: Yeah. I would say spend time with professionals who are doing business in China who understand the ins and outs of doing that. The Chinese markets very challenging. There are opportunities there, but there are risks. Market access can be a challenge. But there’s an American chamber of commerce, the community of people who know how to navigate China. And I’d make sure that you’re working closely with those people. I don’t think we’ve had a chance to say something important about China, which is fine before we sign off. I think it’s important to say the Chinese government is doing a lot of good things when it comes to climate change. I don’t want anybody to walk away with rose colored glasses about this. At the same time, the Chinese government is pursuing some policies that are not good with respect to climate change. And that includes in particular continuing building of coal plants both within China and then supporting that abroad in other countries. And so it’s a very important issue for the globe as a whole. And unless that coal build slows down, it’s going to be much harder to hit any type of global climate targets. Jon Powers: So I do want to talk about the Columbia Center on global energy policy for a second where you’ve put together the book, what is the role of the center and what’s it doing at Columbia? David Sandalow: So our center is a policy research center within the school of international public affairs at Columbia University. We’re only just a little over six years old, seven years old and have grown enormously doing research across a wide range of energy topics and our goal is to provide information that’s useful to policymakers and the public and private sector more broadly as well. And so this book that I’ve just done on A Guide To Chinese Climate Policy is part of that. And one example of that and we spent a lot of time figuring out how to make our research accessible. And so this Guide To Chinese Climate Policy, you can access it three ways actually. You can go to our website and get the entire content, which is there, you can download it for free or you can buy it on Amazon and go to Amazon and it will arrive at your door several days later. So we’re trying to make this useful to anybody who’s interested in this product and that’s the type of thing we’re doing at the center on global energy policy is looking for ways that are useful for policy makers. Jon Powers: And you can find that an energypolicy.columbia.edu and one of the things I love that you guys are doing there, going back to what you just mentioned, is you, I’m often seeing the experts from the center in the media, right? Whether it be in op-eds or being quoted in articles. And it’s really important to have that level of expertise in the dialogue that we’re facing today in both here in the US and of course what you’re doing abroad. David Sandalow: We try to make a contribution. Indeed. Jon Powers: Excellent. So one last question. We’re facing some major elections here in the US hopefully for climate sake and for many other sakes, so maybe a change in the leadership of the White House here in 2020. Is the relationship repairable after the fights we’ve been having? Can we get back on the same page to start working together on things like climate and energy or is it going to take another entire administration before we’re there? David Sandalow: I think that the US and China can absolutely resume working together on this issue. And I hope for the world’s sake that’ll happen where the world’s two largest emitters and the bilateral agreement between the US and China, I think provided a foundation for the Paris agreement. So now it’s not going to be easy. There’s no question about it. One thing I found going back and forth between China and the United States is there’s enormous mutual suspicion and both countries have lots of suspicion of the other. But I think that this is an issue set where we actually have common interests where we both need to work with each other and other countries in order to avoid some really dangerous impacts. And so I think it’s an area where we can absolutely work together and I predict that we will. Jon Powers: That’s good to hear. So, David, thank you so much for joining us. David Sandalow: Jon, it’s a delight. Thanks so much for having me. Really appreciate it. Jon Powers: Absolutely. And you can get The Guide To Chinese Climate Policy at energypolicy.columbia.edu. We’ll also be hosting it at our website, cleancapital.com. You can get more Experts Only podcast episodes there as well. And please, as always, please send notes on folks we should be talking to or interviews we should be having. We appreciate everyone listening. I want to send a special thanks to our producers, Carly Battin and Nicole Waddington for their hard work and research ahead of these episodes. And as always, I look forward to continuing the conversation. Jon Powers: Thanks for listening in today’s conversation. Find more episodes on 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. We look forward to continuing our conversation on energy, innovation, and finance with you. 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