On Tuesday, August 30 the National Clean Energy Summit was held in Las Vegas, Nevada. The second panel of the afternoon was on “Achieving energy security and independence through collaboration and competition” and featured:

• Deputy Under Secretary of Defense, Dorothy Robyn
• Executive Secretary Treasurer of the Nevada State AFL-CIO, Danny L. Thompson
• Chairman of the Federal Energy Regulatory Commission (FERC), Jon Wellinghoff
• Chairman and CEO of Caesars Entertainment Corporation, Gary Loveman.

The panel was moderated by Kate Gordon, Vice President for Energy Policy at the Center for American Progress. The full video of the panel discussion may be viewed here. The following is a summary (only a loose transcript) of the panel discussion.

Achieving energy security and independence through collaboration and competition

Dorothy Robyn (DOD): For the Department of Defense, reducing consumption is a life-saving mission for our convoys in Afghanistan. We spend $4 billion per year to power our installations. Also, our domestic installations are increasingly important for executing remote operations. Electricity disruptions can be dangerous. Since DOD is so large, we represent a huge demand coupled with a history of innovation and leadership. Because efficiency and renewables are in our national interests, we will move in that direction.

Danny Thompson (AFL-CIO): In Nevada, we have long sought to diversify our economy. Construction, operation, and maintenance of solar, wind, and geothermal energy facilities is quite attractive to us.

Jon Wellinghoff (FERC): To move our power grid into the future, we need adequate transmission capability from those remote locations where the energy is being

produced. We’re installing rules to promote competition in the transmission market.

Kate Gordon: What are the concerns about grid security?

Jon Wellinghoff (FERC): There are some. We’re looking for overall security of the grid and are in conversations with Congress about this.

Kate Gordon: Tell me how business fits into all of this.

Gary Loveman (Caesars): We find that our employees at Caesars value the goal of building better buildings with higher efficiency. We all care about recycling and purchasing food from the right sources. I’m also on the board of FedEx and we’d love to completely electrify our fleet.

Kate Gordon: We’ve talked a lot about electric vehicles at today’s conference. How would an influx of these vehicles affect the grid?

Jon Wellinghoff (FERC): Studies have shown that we have sufficient reserve capacity for 70% of our fleet to be converted to electric vehicles if they charge during off-peak hours. We think with proper information, consumers are very capable of making decisions about when to use electricity. Right now, that information doesn’t exist.

Gary Loveman (Caesars): It seems whenever renewable energy starts to gain momentum, economic vitality rises and demand for it decreases. We’d like to plan our projects without those cycles.

Kate Gordon: (from the audience) Can we actually compete on a global scale without a lot of subsidies and tax credits?

Dorothy Robyn (DOD): Probably not. DOD has shown that new technologies don’t just pop out of the private sector (e.g. semiconductors, aviation). There’s often heavy government R&D, procurement contracts, etc. to jumpstart consumer markets. Often we don’t have to develop these technologies ourselves, but rather act as a catalyst for development. We’re big enough that we can assume the risk of being an early adopter. By contrast, consumer building efficiency improvements are a fragmented market which makes their procurement difficult.

Jon Wellinghoff (FERC): Keep in mind that all energy was subsidized at some point. Gas plants are all rooted in aircraft engines procured by the military. The Transcontinental Railroad was subsidized by Lincoln. It’s in our history and, in fact, essential to making these industries competitive.

Kate Gordon: And we see that as the technologies become mature across the world, those subsidies tend to be rolled back, US fossil fuel subsidies aside.

Danny Thompson (AFL-CIO): I agree that the military will help bring renewable prices down. I also think we must be able to compete internationally with labor and environmental standards.

Kate Gordon: How do fluctuating energy costs affect your business, Gary?

Gary Loveman (Caesars): We first try to find ways to reduce costs. Convention hall lights are always on. Hotel rooms have the AC cranked too low. All these things add up. Green energy just isn’t close to economical right now. If it gets close, we’d do it even at a little loss for the overall benefit of it. The difference can’t be first-order, though. It must be modest.

Natural gas makes the problem even more difficult. Oil is more expensive, but gas is less expensive than people expected.

Jon Wellinghoff (FERC): Natural gas is the same price everywhere, but electricity isn’t, nor is it uniformly easy to procure.

Danny Thompson (AFL-CIO): I agree with Gary that it’s an issue of price.

Kate Gordon: What do you say to the criticism that the green jobs aren’t really here?

Danny Thompson (AFL-CIO): They are here. They’re here in geothermal and many other fields, but they are real.

Kate Gordon: It’s great to hear what’s possible within DOD, in business, and elsewhere. Thanks!

On Tuesday, August 30 the National Clean Energy Summit was held in Las Vegas, Nevada. The first panel of the afternoon was on “Western Clean Energy Efforts” and featured Governors Brian Sandoval of Nevada, Jerry Brown of California, and Christine Gregoire of Washington. The moderator was former White House Chief of Staff and president of the Center for American Progress, John Podesta. The full video of the panel discussion is split in two parts which may be seen here and here. The following is a summary of the panel discussion.

Western Clean Energy Efforts

Governor Jerry Brown: “The sun is to California what oil is to Texas,” and we have a lot more sun than they have oil. These things start small, grow big, and we’re never not going to need energy.

Governor Christine Gregoire: I’m excited because my state of Washington is leading in renewable energy. We’re the 4^th largest wind producer in the country, we’re a leader in solar photovoltaics, and we’ll have charging stations for electric vehicles. We plan to map renewable zones and wildlife corridors, and we’re in the process of putting together a Western transmission plan. We’d be very naïve to sit back and do nothing simply because we’re in a recession.

John Podesta: On charging stations, I think a lot of people would be surprised that you can now recharge electric vehicles in 20 minutes with the right technology. Governor Brian Sandoval, your state of Nevada leads in unemployment”¦

Governor Brian Sandoval: We understand we have a great opportunity in renewable energy and I’ve been personally visiting solar and geothermal sites. Like Washington, Nevada is also looking at renewable energy zones and transmission. Our state is 86% federal land, so we need to have a very good relationship with the federal government to get this accomplished.

John Podesta: Some people argue your renewable energy targets are too ambitious. How do you respond?

Jerry Brown: I think we can make it. The question is whether we can keep the cost down to make it feasible. The price of solar is coming down, so we’re optimistic. We’re also well-positioned with having some of the most intense solar locations in the world. We’re going to crush the opposition or listen to them companionably depending upon the circumstances. (laughter)

John Podesta: Where the sun shines isn’t always where the people are, so how difficult are the transmission issues for you?

Brian Sandoval: Our office of energy is working on these transmission corridors as we speak. We intend to work with California on these issues.

John Podesta: How are you dealing with larger transmission issues on a regional scale?

Christine Gregoire: We’re looking to wildlife corridors and considering the best locations for each renewable source. Also, if we reach the portfolio standards we’ve set for ourselves, we don’t need to worry about interstate issues. However, congestion remains a problem in our state. We have so much hydropower that we had to tell wind producers to shut down, which means they lose a tax credit. That acts as a disincentive.

John Podesta: Does linking the states help the intermittency problem?

Christine Gregoire: It can. Wind off-season in Washington is on-season in California, for example.

Jerry Brown: A regional grid allows energy to be moved around in a very efficient way. The more we can send surplus to deficit, the better the system becomes.

Brian Sandoval: I agree. In Nevada trying to get to 25% renewable energy by 2025.

Audience question: How do we get renewables on the fast track?

Jerry Brown: We need long-term stable incentives, a sound framework, and appropriate tax policy. Also, we must increase demand, e.g. through the Navy. We also feel that as the effects of climate change becomes more apparent, demand will increase for renewables.

Christine Gregoire: I agree with Governor Brown that need long-term stable incentives. Congress needs to step up. They must continue to invest in R&D.

Brian Sandoval: Agreed. In Nevada, all the interested parties already have a relationship with the BLM [Bureau of Land Management].

Jerry Brown: California has an energy commission which serves as a “one-stop shop” for renewables. It’s good to plan things, but we really need to get things going as soon as possible. I wouldn’t wait on it. We need to do everything we can to get it done.

Brian Sandoval: We’re planning corridors and permitting simultaneously as well.

John Podesta: What’s your strategy to remain competitive in a global economy?

Christine Gregoire: I realized during Copenhagen that the US has ceded its leadership in the field of renewable energy. The importance of this industry is obvious to other nations. Now in Washington, we have some of our companies doing work with Shanghai Electric. We need that export market and the jobs that come with it.

Brian Sandoval: We believe the future of American competitiveness can go through Nevada with manufacturing and generation. We have a partnership with the ENN Group, who spoke earlier. Our goals are aligned with renewables and so we feel we will remain well-positioned to deal with foreign companies.

Jerry Brown: California is bringing in 50% of the renewable energy venture capital in the US. Energy needs will grow as will companies that satisfy them. California has a rich history of creating great companies, like Apple. We can do a lot in our state, including the smart grid. We see many jobs in this.

Audience question: Can we solve these problems without education?

Brian Sandoval: We’re excited to strengthen and align our STEM curricula.

Christine Gregoire: No, we have to invest. Ours is an innovation economy. For example, in Washington Boeing is building carbon fiber planes. Planes are being flown with biofuels. Our state is thinking of these great new products, but this can’t be done without STEM education.

Jerry Brown: Education is important for green energy, but even more important for citizenship. We especially need to ensure that talented foreign students who train in our universities are more easily permitted to stay.

John Podesta: You are all under huge budget pressures. How’s that affecting you?

Jerry Brown: We’re lowering investments in almost everything, though green energy is being subsidized by rates, private investments, and so on. We’re not keeping pace with our accumulated infrastructure bill. People need to understand that government isn’t an STD to be afraid of. Market fundamentalism is an impediment to smart balance. Look, the private sector has lots of creativity, but we need the right balance with government.

Christine Gregoire: Washington is hurting too budget-wise, but are trying to find ways to save money. One way is by retrofitting schools and using the savings to pay the companies back.

Brian Sandoval: We’re putting solar on schools and powering some by geothermal. We vow to align education with renewable energy.

John Podesta: Are big market pulls like requiring your state to run on a certain percentage of renewables by some year a good plan?

Jerry Brown: Absolutely, and it’s bringing investment into California.

Christine Gregoire: I favor a national energy standard, but I don’t think it’s going to happen any time soon so states need to step up.

Brian Sandoval: I agree.

Audience question: Will your state accept importation of out-of-state energy and supply the transmission resources to make this possible?

Brian Sandoval: We Western leaders have already talked about our mutual interests there. Nevada and California will have a relationship.

Jerry Brown: How much we import must be balanced by how much we produce locally. We intend to be an exporter, a leader, but that doesn’t mean we will ignore useful synergies.

Christine Gregoire: I mirror Governor Brown’s position.

John Podesta: Do you want to give people in DC any advice?

All: No. (laughter)

Vice-President Joe Biden gave what I thought was an excellent speech this afternoon at the National Green Energy Summit 4.0.  There was a particularly compelling portion of his speech in which he provided historic precedent to defend public investment in science and technology.  He said:

You know, this negative argument that we hear all the time is not new to America.  There are naysayers in the political leadership who hold the view that government has absolutely no role and should not be setting a vision for the future providing setting seed money for anything.

I would argue that at every juncture they have been proven wrong.  Had we listened to those voices back in 1774 private enterprise and the government would not have collaborated to build the rifles with interchangeable parts that were needed to win the Revolutionary War.

Had we listened to those voices in 1843 Congress would never have collaborated with Samuel Morse to build a demonstration telegraph line from Washington to Baltimore unleashing a telecommunications revolution.

Had President Lincoln listened to those voices during the Civil War He wouldn’t have paid private railroad companies $16,00 for every 40 miles of track on the Transcontinental Railroad they laid down.

And if President Eisenhower had listened to those voices in 1957 he would never have invested the $25 million in research in an endeavor called APRA which invented ARPA-NET which became the Internet.

And if President Kennedy had listened to those voices we would have never have reached the moon and reaped the incredible benefits that flowed from that effort.

And I can assure the President and I are not going to listen to those voices and hope to God you aren’t either.  Because in the words of President Obama, “We are the ones we have been waiting for.”

The second part of this morning’s session of the National Clean Energy Summit 4.0 asked a collection of panelists, “How will consumers benefit from a clean energy future?”  The topics covered included the new smart grid, green buildings, electric vehicles, and manufacturing.  Here, I paraphrase and provide summary of the speakers’ arguments.  Feel free to browse the videos for full comments.

Video of talks: Part 1, Part 2, Part 3

Rose McKinney-James (moderator): This panel is about consumers and information for consumers going forward.

Jesse Berst (smart grid expert, Smart Grid News): We are remaking electricity top to bottom.  It’s been called the single greatest engineering accomplishment of the 20^th century.  The system is amazingly complicated.  Without it, life was dark, smelly, difficult, and painful.

The choices we make today will reverberate for many years to come.  We are about to electrify our transportation!  Think about this in historical context.  Edison invented the grid, Eisenhower designed it, and Nixon installed it.  If we were to compare other technologies to that time, e.g. rotary phone vs. smart phone, computer of 1950’s vs. servers today, there’s massive differences and innovation.  But with our electrical grid, we are where we were.

Grid 2.0 will have smart devices, smart communications, and smart software.  It’s more observable, controllable, and self-correcting.  There are already some great examples in play in many cities throughout the country.  We need to spend at least $1 trillion to update the system anyway, so let’s do it smart.  It works out to be the price of an extra large pizza per household per month.

In 1950 the 20% of US GDP was dependent on electricity.  This jumped to 60% after some decades.  Just like the transcontinental railroad, Internet backbone, interstate highway system, Grid 2.0 is a legacy of prosperity.  We can devise the technology to provide electricity to the last 20% of people in this world who still lack it.  We have to do this right and do it right now.

Roger Platt (US Green Building Counsel): Buildings waste tons of energy and fixing that can create jobs.  Buildings represent 70% of our electrical use and about half of our greenhouse gas emissions.  We spend about $400 billion per year using all of that energy and about 30% of that, or $130 billion, is horrendously wasteful.  Let’s reinvest that in and create good jobs.

Our building sector is very slowly improving its efficiency, faster than cars, but still slow.  We want to create demonstration projects, 10,000 buildings around the world that meet the LEED standard for green energy performance.  We want better air quality in buildings.

How do we accelerate progress and give more people a taste of the future?  Going from Edison’s work to smart phones required constant innovation.  While we haven’t been innovating in the same way with buildings, there’s much potential.  Obama is doing a good job with his Better Buildings Initiative.

Jim Motavalli (environmental writer): V2G (vehicle-to-grid) is the ability for your cars to return energy to the smart grid.  In the future cars will be a lot smarter and far more integrated into our electrical system.  People will get paid by allowing their cars to provide energy back to the grid during peak times.

The idea of electric cars has been proposed before.  In fact, a majority of the first model cars were electric or steam-based, as gasoline was still noxious and loud.  Another attempt was made in the 1990’s but it was a total failure.

Price is key.  It’s hard to make a $20,000 electric car!  The Tesla Roadster, a luxury electric vehicle is great, but at $109,000, it’s largely unaffordable.  Regarding the other prominent EV’s on the market, about 10,000 and 4,000 Nissan Leafs and Chevy Volts have been sold so far, but that’s somewhat artificial because supply has limited this number.  According to owners, they love them!  The Leaf, an all-electric vehicle, can go 100 miles on a charge, while the Volt, which sports a back-up gas engine, has a range of 400 miles.

There are other company and brands like Aptera 2E, Wheego Whip, Coda sedan, Fisker Karma, BYD E6, and BMW Active E developed EV’s as well.  Be on the lookout.

The benefits of electric vehicles include mitigating global warming, side-stepping peak oil, zero emissions, no smog, instant torque, fast recharge availability (soon), quiet operation, and programmability.  However, they are initially expensive, have limited range, requiring behavior modification to plug-in rather than fill up, and there’s a finite battery life.

It’s an emerging industry, and while the future is unclear, having about 10% of road vehicles be hybrids by 2020 is realistic.  Obama has helped this effort by supporting electric battery start-ups in Michigan.

So will EVs succeed in the marketplace?  Considering climate change and peak oil, this seems inevitable as long as people understand our world’s new constraints.

Chandra Brown (President, United Streetcar): Manufacturing is responsible for 70% of all private-sector research and development spending and 90% of all American patents.  Also, manufacturing is a major driver of economic growth – every dollar in final sales of manufactured products support $1.37 in other sectors of the economy.  They pay over 20% more than the average job.

My company, Oregon Iron Works – United Streetcar, manufactures many products including ships, streetcars, and wave energy generators.  While Portland, Oregon installed the first modern streetcar in 2000, we learned that there weren’t any manufacturers in the United States and saw this as a market opportunity.  We hired welders, machinists, engineers, etc. and created an industry!

We brought jobs back to the United States.  There are lots of parts of a streetcar (seats, for example) that we don’t make.  There are over 200 vendors in 20 different states that are partners with us.

We recommend increasing transparency and accountability of Buy America regulations.  Also, we should support American manufacturers in retooling facilities to increase competitiveness.  We must continue investments in research and development.  We should establish a national renewable electricity standard.  We should pass a fully-funded, six-year extension transportation and infrastructure bill that continues meaningful investment in mass transit and transportation electrifications.

A roundtable discussion moderated by Rose McKinney-James from Energy Works LLC followed.

Chandra Brown: We believe in the Recovery Act, but we believe that we should be getting a lot back for each $1 of federal investment.

Jim Murren (Chairman and CEO of MGM Resorts International): At MGM Resorts board, we agree that training and communication are important.  We’ve set up green teams throughout our company, invested in their training.  If you stop at the top, you’ve failed.  You need to bring it down to the company at large.  Second, you have to reach into the community and get them to buy into what you’re doing and why it’s important.

Roger Platt: Luxury has historically become ubiquitous over time, e.g. cell phones in cars and first run movies in homes.  LEED standards for great buildings can be part of that future, but let’s accelerate it.

Jesse Berst: The smart grid is the glue that makes everything else possible.  This is needed for renewables at scale.

Jim Motavalli: We are on a track to electrify transportation, but people are rightfully skeptical because we still need to generate that electricity at power plants, which do emit.  In fact, generating electricity purely from coal gets you to the emissions standard of a Toyota Prius.  A truly clean grid can lead to real zero-emission cars.

We’ll also be able to know what causes electrical disruptions and respond organically.

Rose McKinney-James (moderator): What are the opportunities to create jobs?

Jesse Berst: The smart grid is already doing that as a recent study from Duke reveals.  We need to be leaders in this, because that’s where the jobs will come.  We need to clean up our own back yard and move international from there.

Jim Motavalli: The lithium ion battery market is primed to go entirely to Asia.  What Obama is trying to do is preserve this market in the US in Michigan.  As the center for auto development, it should also be the center for battery development.

Roger Platt: Devices meant to save water in buildings are part of a whole new host of technologies being developed.

Chandra Brown: In addition to what I’ve mentioned earlier, I can add that small companies in this country are hiring.  There are growth markets, so perhaps this is a messaging issue.

Jim Murren: To me, it’s all about education.  If consumers demand sustainability, companies will be motivated to make those changes.  People book here at the ARIA resort because we are the largest LEED certified center in the world.

At around 12:15pm EST, Secretary of Energy Steven Chu took the podium at the National Clean Energy Summit 4.0 – The Future of Energy to deliver the opening address.  In the spirit of summary, I have paraphrased his speech:

During the Recovery Act, our government supported the clean energy enterprise though policies like loan guarantees and grants.  These saved an economy that was in free fall.  For each public dollar invested through loan guarantees we leveraged roughly ten times that in private money creating over 10,000 jobs.  Manufacturing tax credits allowed for $560 million of economic benefits in first five years.  There are many similar success stories.

We’ve also invested in “critical research”, e.g. through the agency ARPA-E which was designed for high-risk, high-reward research.  So far, it’s a “spectacular success.”  There may not be home runs yet, but lots of people are rounding second base.

People have argued that in difficult times, much like those we face now, government should retract and avoid overextending itself.  I believe history proves this is notion wrong.

During the Civil War, things were bleak.  Despite our incredible national stress, the Morrill Land-Grant Colleges Act was passed in 1862.  Its goal was to “teach such branches of learning as are related to agriculture and the mechanic arts.”  This led to Transcontinental Railroad and later developments during WWII.

There are other examples of thinking long-term during times of conflict.  In 1957, during the Cold War, Sputnik 1 was launched.  Eisenhower took the long view and identified the root problem: the US was lagging the Soviets in training scientists and engineers.  In response, he launched education programs from which many scientists, including myself, benefited.

So what about this idea that the best ideas should always come from the private sector?  The Wright Brothers invented the airplane in 1904, but within a decade Europe had surpassed us.  As the US developed its postal industry, the need for air mail became paramount.  A public-private partnership with domestic aviation supported the regeneration of this vital American industry.

The US military was the first market for semiconductors.  Many of the first computers and computer science departments were government sponsored.  I already mentioned the Land Grant Universities during the Civil War.  Always, the government played a critical role.

So where are we now?  In the last 5 years, the price of solar photovoltaics has dropped 50%.  This is set against the backdrop of increases in oil prices.  The Obama administration recently passed new automobile fuel efficiency standard of 54.5 mpg by 2025.  Drivers will save over $1 trillion as a result.  Appliance standards from the Department of Energy will save Americans half a trillion dollars over the next several years.

In times of fiscal austerity, we must look for the most effective leveraging of public dollars to spur private investment.  Our innovation machine is the envy of the world, but it shouldn’t be taken for granted.  Investments in education are the seed corn of our future.

We must also adopt a clean energy standard, which doesn’t pick winners and requires no tax expenditures.  Also, it will minimally affect energy price and spur green jobs.

The US can lead in the energy race, but we are at a crossroads.  Examples of foreign successes abound.  China has the high voltage transmission lines in the world and they’re trying to market them abroad right now.  So, we can lead in clean energy development, or we could do nothing.  Let’s take the long view and be better for it.