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Mr. Nelson: Nice to meet you all.
I'm Greg Nelson with the White House Office of Public Engagements.
I work on energy and environment issues and through that I've had
the chance to meet many of you.
I'm very excited to see you all here today.
Welcome to the White House and thanks for making your way
through our security lines.
We appreciate the effort it took to get here.
There will be some folks still trickling in as they get their
security, so please show your patience for those folks as they
come in and take a seat in the chairs.
We've got a great program today.
We're excited to hear from you and get a chance to learn a
little bit about the work that your organizations and your
companies have been doing in this area,
and I think we've got a great program of speakers from the
White House coming to talk about some of the great work that the
White House and the administration is doing
in this area, as well.
To lead us off, I want to introduce my boss,
Miss Valerie Jarrett, the Senior Advisor to the President.
(applause)
Ms. Jarrett: Thank you, Greg, and good morning, everybody.
We are just delighted to have you back here.
I know many of you in this room have been working tirelessly
with us on both, energy and the climate change and our
legislation, legislative agenda, and we just
appreciate that ongoing relationship.
I want to welcome you to our new space.
It's our first event that we've had in this new space
over in the EEOB.
So we're proud to be able to have a new facility to work with
you, and I just want to thank you guys for all of your hard work.
There is a hard road ahead, and we have a lot of important work
to do, and we simply can't do it without you and your support and
your guidance and your counsel and your energy,
no pun intended, devoted to this very important cause.
You are the ones that are out there on the front end
every day with your entrepreneurial spirit,
your emphasis on innovation, your focus on opportunities for
tomorrow, and it's with you that we're going to move our country
forward in a positive direction.
And the point person in the White House who we are so
fortunate to have dedicated to this initiative is none other
than Carol Browner, who I know you all know and
have worked with closely.
And so with that, I'd like to turn it over to Carol, please.
(applause)
Ms. Browner: Thank you, Valerie, for that introduction,
and let me just also thank Valerie and her staff for all
they do to engage the business community,
engage the nonprofits.
It makes a real difference when we're able to work with you all
and learn from you all.
I do know many of you, and those I don't know;
it is nice to get to meet you.
I want to start by thanking all of you for the incredible
leadership you are providing on an absolutely essential issue
for this administration for this president and ultimately for our country.
As you know, the president has said from day one that we need a
different energy future.
We need an energy future that is about breaking our dependence on
foreign oil, an energy future that creates clean energy jobs
here in the United States, and that we need to put a cap on the
dangerous pollutants that contribute to global warming.
We have been about doing everything we can to
make that a reality.
The first thing we did, as you're well aware,
when we came to office after the president's election was to work
with many of you to craft the energy portions of the recovery
act or stimulus, as we frequently refer to it.
And I think the fact that we were successful in securing so
many dollars for new technologies, loan guarantees,
weatherizations, efficiencies, batteries,
is an indication of the level of interest in our United States
congress for a different energy future.
You may remember after the bill passed and after the president
signed it, it was referred to by I think it was the New York
Times as the biggest energy bill ever in the history of this
country, and I think that is probably true.
Secretary Chu and his team, Matt Rogers,
have been hard at work moving the money out across the
country, and I think we're starting to see some of the
impacts of those dollars.
We're starting to see businesses rehiring because of the recovery act.
Now, obviously, we have a long way to go when it comes to the
economy, and then Larry Summers and others are hard at work,
and Tim Geithner, but I think we can be encouraged that there is
a growing demand for clean energy in this country.
In terms of the legislative agenda,
which is now where we have turned our focus in terms of
comprehensive energy legislation, as you know,
the bill has passed out of the house.
I think there were many folks who said in March,
who said in April, it's not going to happen,
I think there were folks that said on the date of the vote,
it's not going to happen, but there was bipartisan support for
this bill, and it has, you know, obviously come through the
house, and now we have turned our sights on the senate.
The senate, like every issue, is a slightly different entity when
it comes to the legislative process than the house, very,
very different rules, not the least of which rather than a
simple majority, we will need 60 votes to pass the bill,
to invoke (inaudible) so we can go to debate on the bill,
and I think that it is not -- it's not impossible.
60 is never easy, but it's not impossible.
We're encouraged by several things that are happening right
now on the Hill, and some of them you may already be aware of.
First of all, Bingaman was able to pass the energy,
the renewable energy standard, the nuclear loan guarantee
portion of the comprehensive package out of his committee
with bipartisan support.
I think that's extremely important.
Last week Kerry and Boxer introduced the climate portion
of the bill and are moving towards hearings in the not too
distant future and will look to bring the bill out of that committee.
Other committees of jurisdiction include Mr. Rockefeller,
the AG Committee, the Finance Committee and foreign affairs,
and in varying degrees, they are all doing their work right now.
Obviously the finance committee is a little bit slower than the
others because their time has been taken up with healthcare.
But we do continue to believe that this can happen.
The schedule is something that's a little bit beyond our control.
Obviously the senate has taken more time on healthcare than was
originally anticipated, but they are quite capable of
doing more than one thing.
Once the individual committees have completed their work,
what Harry Reid has told us and he's told many people is that he
will then look to crack what's called a leadership bill.
And that's not just the sum of the parts.
It's not that he just adds up what everyone has done
and turns it into one bill.
He'll actually be looking to make sure that this leadership
package has bipartisan support.
And so we've been doing work with a number of republicans who
are interested in comprehensive energy reform.
A number of them have particular things they'd like to see in the bill.
I think they are things that many of us would agree with,
so in the coming weeks and month I think we will start to see
emerge what the consensus package could look like,
what the outlines of it will look like.
From our perspective, obviously a strong renewable electricity
standard is important.
We believe obviously there needs to be a cap.
There needs to be an economy wide cap.
There needs to be a robust trading regime.
We need to make sure that a nuclear is part of our future.
We think it is an important part of our clean energy future.
We need to make sure that consumers are protected,
that there are mechanisms where the allowances,
the revenues generated from the sale of the allowances can be
rebated to consumers, and that are trade sensitive energy
intensive industries get the kind of support they need as we
move through a transition.
Whether or not this can be completely done by the time we
go to Copenhagen for the international discussions I
think is an open question.
We're certainly going to do everything we can to be as far
down the path as possible, and I think that Harry Reid is
interested in making sure we are as far down the path as possible.
The -- I think the final thing, let me just say,
and I know they wanted me to take some questions from you
all, is that we wouldn't be where we are in this debate but
for your engagement, and we're not as federal employees,
as White House employees, allowed to encourage you or ask
you to go lobby your members of congress.
But, obviously you make your own decisions in term of what you do.
But the degree to which the American people hear your
voices, hear from the business community why this is important
to them, what's in it for them, makes it that much easier for us
when we're up on the hill talking to members.
And I know that's what you're doing,
and we can't thank you enough for all of the leadership you
are providing on this very, very important issue,
and I am happy to answer any questions. Yes?
I don't know if you need a mic, or I'll just assume not.
Go ahead.
But if you don't mind introducing yourself.
Audience Member: No. David Weinstein with the I2A Fund in Chicago.
I just think it's important you have vignettes as part of your plan.
And last week completed an investment in this company so
far, which was a solar energy company.
That investment would not have been made had you not been smart
as you get and convert it to a cashed grant.
Ms. Browner: Yep.
Audience Member: So I just think it's important that you have
vignettes and that we provide those for you,
because we originally said no to the deal,
but then when we changed our policy,
we changed - and by the powers flow -- I think that's just an
important story for what this information is doing.
So I'm happy to share that story with you and hopefully the
company will do very well, and I hope that there's more stories
that can be shared with the administration like that,
showing how the policies that you put in place have really led
to significant economic impact.
Ms Browner: Well, there are a billion dollars worth
of those stories, right.
We've already done a billion.
But, thank you very much, because vignettes are really,
really important to us, and if you guys have stories that we
can use, it's incredibly helpful,
and if you can share them with Greg Nelson,
who is going to stand up, that would be -- you know,
the president likes to use and the Vice-President,
we all like to tell the story of what's happening out there.
And you know, when we were -- and I see John Duran
in the front row here.
He was very helpful to us when we were putting together the
recovery act provisions and really helped us understand this
whole issue about the cash grants.
And, you know, as you might imagine when we first suggested
it to people on the Hill, it was not all that well received,
but we hung in there and we worked at it,
and some of you helped us worked at it.
And it's turned out to be hugely, hugely successful.
And we just had, we've had, I think,
last week or maybe it was the week before,
Secretary Geithner and Secretary Chu announced the fact that we
had hit the billion dollar mark.
And, you know, we get to keep going.
It's one of the few things in the recovery
act that's not actually capped.
As long as people are there and qualifying,
the money will continue to flow.
And so we're very excited about that program.
Other questions or comments?
Audience Member: (inaudible) so how important is carbon credit and how for
(inaudible) Copenhagen, and how visible with the president be
in trying to get that passed before (inaudible)?
Ms. Browner: Well, we've already been -- the president has already
been very, very visible in the House vote, for example.
I think we had, I don't know, how many members
up here for personal meetings.
First we brought the entire committee,
democratic members of the committee up here for a meeting.
Then we brought members in individually from meetings.
So we both worked hard to get it out of the committee and then to
get it off the floor.
And it was, actually the timing worked out quite well,
because we do an annual congressional picnic,
and that was the night before the vote.
Some members that might, who might have wanted to avoid us
didn't have the opportunity.
We were able to bring them in and talk to them.
So the president has already engaged and is fully committed
to engaging in the Senate.
You know, obviously right now people's time is taken up with
health care, so what we've been doing is all of the work with
the individual committees to keep the process moving.
But the president, this is one of his top three priorities,
and nothing is going to change in that.
We will manage in Copenhagen wherever we are in the process.
We have the House.
We'll be moving forward if not done in the senate,
and we'll be able to manage that.
And, you know, I am very encouraged by what
is possible in Copenhagen.
I was with the president two weeks ago at the UN General
Assembly where he spoke on climate change.
We had a number of bilateral meetings,
including with the Chinese, which gave me a lot of
encouragement that, you know, these kind of meetings four,
you know, ten years ago were of a very, very different nature.
I mean, obviously China is making huge commitments,
huge investments in renewables.
That's obviously good for the Chinese.
We need to be doing the same here.
We need to make sure that we're competitive in that market that
we're creating U.S. jobs, and that we're ultimately leading
the exports of clean energy technologies.
And I think we can do that, and I think we're making
a turn towards that.
What I hear from you all is you need the certainty and the
predictability to make those kind of investments,
and that's what comprehensive legislation is going to give you.
Now, every now and then we hear from people saying, well,
let's just do the renewable electricity standard,
let's not do, you know, the other parts of the bill.
Let's not worry about putting a cap on greenhouse gas pollution,
we can do that later.
We think that would be a big mistake.
We think you have to keep these programs coordinated,
because they do impact with each other.
We also realize that states are starting to
put caps on greenhouse gas.
EPA has some authorities that it's going to start to use,
and all of that is good, but I think we would all agree that a
comprehensive national program is what's really going to give
us the playing field that will allow for the investments,
that will create the jobs and allow us to compete in the
global market for clean energy.
In the back?
(applause)
Audience Member: Good morning. My name is Joe James.
I'm with a company called Agri- Tech, and we convert cellulosic
material into a coal replacement.
We've had a lot of interest from India and from China,
but we're nervous about sharing our technology there due to the
potential loss of our IP.
As you're having those one-on-one discussions with
those countries, is there some way that you can protect small
companies like ours so we don't have to run of risk of having
knock offs produced at some of those countries?
Ms. Browner: Well, that is a -- thank you for asking the question
and for reminding us that we need to be mindful of that.
Obviously we're, you know -- those of you,
and many of you do, do business in China,
understand that the tech transfer issues are complicated,
they are important, and how they are managed is always fairly,
fairly complicated, but I think the point you're making is one
we need to be mindful of, which is as we look at what kind of
bilateral, bigger, broader relationships we can have with
China, the president will be traveling to China next month,
and so we will be looking at that bilateral relationship.
We need to be mindful of the small businesses here in this
country, and both the opportunities in China,
but how we make sure that you preserve what is important to
you and what's valuable to your company.
Audience Member: (inaudible) solar from Indiana.
I created a solar power attic fan in my garage,
and did it 10 years ago -- Bill Keith (sic)--
can you hear me all right?
Ms. Browner: Yeah.
(laughter)
Do you know that this is the first time anyone has used this
new facility, and if you've been in the old facility,
you couldn't hear in the old facility.
So apparently one of the things they fixed was the acoustics.
Audience Member: So I created this solar powered attic fan in my garage,
and I did it 10 years ago when the green people,
if you will, the clean energy people, Birkenstock wearing,
tie-dyed shirt people.
Ms. Browner: Granola-eating.
Audience Member: Granola-eating people.
And I had come out of a conservative home,
and I just thought it was a good idea.
Now I've gotten -- and there were no programs whatsoever to
help me, not on the state or federal level.
I did it out of sheer will and determination that I was going
to make this thing happen.
Now, the tidal wave has totally crested over my head.
There is still nothing available for small business.
In fact, we couldn't even ramp up in the two week time period
we had for the $30 million Federal Research Development
Grant, and I had some pretty good people on my team trying
to make us meet that deadline.
I asked Secretary Salazar about this last night,
and his response was, I think the SBA has some programs.
Well, I had lunch with the SBA yesterday,
and they don't have any programs.
So, what could you say to encourage more small businesses
that are garage inventers where I've added jobs,
manufacturing jobs in the state of Indiana?
I think that's why I'm here today,
is because we are a success story.
So how you foster more success stories like mine when it
doesn't trickle down to my level?
Ms. Browner: So, can you help me understand why you think
the SBA doesn't have programs?
Audience Member: Because I went to the SBA, the SBDC,
the Department of Commerce, I called Senator Lugar's office,
Senator Bayh's office, Congressman Visclosky office,
and the closest thing that they could get for me is they said,
are you making your product in a rural area?
And I said, well, I'm 35 minutes from downtown Chicago,
there are some farms around.
Maybe -- He said, maybe if you're over the border where
you're in a rural area we could get you some kind of an
agricultural grant because you're manufacturing in more of
an agricultural low income area or something.
And that was a big stretch.
Ms. Browner: Right.
Audience Member: So I don't know.
I've asked everybody that I am supposed to be asking.
Ms. Browner: Well, hmmm.
I'm surprised about the SBA based on what I know,
but obviously I don't know everything.
What we should do is let's take your card,
if you'll give your card to Greg,
and we can maybe get some more -- better understanding,
because obviously we do want to encourage small businesses,
and we do want to encourage entrepreneurs in their garages
and help them get from their garages to hiring lots of folk.
And if we --
Audience Member: (inaudible) we're going to do about 4 million
in sales in year.
Ms. Browner: Wow.
Audience Member: And we're going to pay over $200,000 in taxes.
So it is a success story.
I don't need the help now necessarily,
but how do you start help a new guy?
Ms. Browner: Right. Well, that's what would be helpful to understand,
which is, where are the holes, where did we not have
the programs and what kind of programs could we have had,
or how do we change existing programs,
because sometimes we can change existing programs.
As I said, what I do know about the SBA would lead me to think
there is some opportunity there, but clearly your experience was
there wasn't, and we should figure that out and see if we
can help the SBA think a little bit differently about this going
forward, but congratulations on your success.
Audience Member: I'm Michael Shore.
I'm the president -- Michael Shore,
I'm the President of FLS Energy.
We're a solar energy generation company,
and we own the solar energy systems,
solar thermal systems on the roofs of companies and then sell
the BTU's, sell the hot water to the clients, like a hotel,
or a military base, or hospital.
And a lot of the attention on solar energy and renewable
energy seems to focus on solar PV,
and I get nervous that as legislation works its way
through the Senate or through congress that solar hot water,
which is highly cost effective, we're able to charge our clients
significantly less than what they would pay for natural gas
or electricity for heating their hot water.
So I just want to make sure that solar hot water isn't overlooked
the just because it doesn't have the sex appeal that solar
electric technology has.
Ms. Browner: Do you know if either the Binghamton bill or
Waxman-Markey did the right thing,
didn't do the right thing; do you know?
Audience Member: I believe that solar hot water was added later.
There was an amendment.
I'm sure somebody in here knows better than I do.
There was an amendment not long before it passed,
so it was almost an afterthought.
Ms. Browner: There were a lot of amendments, in fact.
Audience Member: Yeah.
Ms. Browner: Which is, it's a good thing in the process.
It's how things get better.
Audience Member: Sure, sure, but I just want to keep this issue
top of mind, just because it is so cost effective.
Ms. Browner: Yep. Thank you.
I don't know how much more time I have.
One more?
Audience Member: Hi. Jeffrey Hollender, I run a company called Seventh
Generation we sell very mundane products like bathroom tissue
and laundry detergents.
Ms. Browner: But you sell a lot of it?
Audience Member: We do.
In spite of the lack of economic incentives to help us,
but our business did grow 51% last year.
Ms. Browner: Wow!
Audience Member: And so this legislation which will change the playing field,
because those products that are more carbon intensive,
will become somewhat more expensive,
and consumers will be helped to make the right decision.
My question for you is, there is a lot of legacy programs in the
government, and recently the calculation was that the
government spent about a billion dollars helping the Virgin
Timber Industry build roads to cut down trees,
which artificially makes products like recycled tissue
more expensive, because they are not competing on a level playing field.
What's happening with looking back to some of those legacy
programs to bring them into line with the administration's
current philosophy?
Ms. Browner: So each of the Cabinet departments and agencies
-- and Secretary Chu has just joined us --
do undertake these look backs.
They go through all the regulatory programs that are in
place and determine whether or not they should maintain them.
What's complicated about this is the only way you can get rid of
an existing rule or requirement of the government is with a new rule.
So you have to undo it through a process,
and that means it just takes time.
One of the things that Secretary Vilsack has been looking at and
there's been some court cases in the last couple of weeks,
and they are in slightly different places,
is the roadless rule that was put in place by President
Clinton, and then the Bush administration sought to amend,
and I think we're trying to return to something that's more
appropriate in terms of environmental protection,
which I think would have an impact on some of the issues
that you're raising.
But there are these programs that allow the agencies to go
back and review rules.
I just -- I just want to be clear that it is a time
consuming process, and at the same time all of our wonderful
Cabinet secretaries are eager to get on with new programs,
like the thing that Steve Chu is doing on energy efficiency,
which have just been amazing, a program that had really not been
tended to for a considerable period of time.
And I think you set like five standards since you've been in office.
Is that -- so, we're sort of trying to move here on two tracks.
Let me turn it over to Steve Chu,
and again let me just thank everybody for what you're doing.
Please send us those stories, and the more details,
the better off we are, the better able we are to use them.
Let us know where the green jobs are being created and how they
are being created and why.
Thank you all very, very much.
(applause)
Mr. Nelson: Wonderful. Well, now we're going to get the chance to hear from a
couple of business leaders who have come along with you all to
let us hear their stories about how this is starting to impact
some of their businesses.
So, Wayne Leonard, the CEO of Entergy is going to start us off.
Mr. Leonard: Good morning.
We are a broad based business across America.
We represent some 37 states.
We touch all aspects of the economy,
and we have come together here this morning unified and one
particular request, and that is that we pass comprehensive
climate change and energy policy legislation this year.
We are prepared as business to invest, to innovate,
to transform the energy sector of this country and of the world.
The way we source energy, the way we deliver energy,
the way we use energy.
We want to get America back in the business of exporting
technology instead of dollars.
In order to do that, we need comprehensive legislation.
We need to know what the rules are going to be with regard to
energy and with regard to climate and particularly with
what the price of carbon is going to be in the United States
if we're to move around the world and export technology to
other countries and we need legislation in order to do that.
I'm the CEO of Entergy.
We have nuclear plants around the country.
We also serve 2-1/2 million customers in the Mid-South and
the Gulf-South portion of the country.
Some of the poorest people in the country,
people that have been through Katrina, Gustav,
Ike, Rita, you name it, they've been through it.
Nobody should ever have to suffer through a Katrina.
Last night I was talking to Secretary Salazar.
And he asked me, what happens to New Orleans when sea level rises
not an inch from thermal expansion but meters due to
land ice melt in West Antarctic and Greenland?
And I said, well, we have a pretty good idea of what's going
to happen, but we do have some protections,
because we're working on New Orleans.
What we haven't given enough thought to is
what happens to everybody else.
What happens to all the Coastal cities?
What happens to the east coast of the U.S.
with a slightly tilt of the planet on its axis as we melt
those ice caps?
There's no protection for them.
And we're not talking about hurricanes anymore.
We're talking about potentially Tsunami type of events like
we've seen in Asia, like we've seen most recently in American
Samoa, a completely different set of events than what we're used to.
Some people say we can't do this because of the cost.
As business, we all look at it in terms of it's an investment.
In this case it's an investment that by all facts, figures,
analysis, pays back many times over.
It pays back with reduced adaptation costs in the future,
reduced repair and damage from these type of events and growth
in the economy through transferring technology around
the world and creating jobs at home.
Some people say we can't do this because there are some things
that are uncertain.
But in large part, that is precisely the reason we need to
act, because of the uncertainty, not necessarily because of the
thing we do know.
We do know a lot, as you all know.
We are virtually certain climate change is occurring and it's
occurring because of man's activities.
We're virtually certain the probability distribution curve
is all bad.
There is no good things that's going to come of this.
What is uncertain is exactly which one of those things will
occur and on what time frame.
In that probability, distribution curve is about a
50% probability, about half of all species will become extinct
or subject to extinction over this period of time.
What we will never know on an (inaudible) basis is whether or
not man will be one of those casualties or not.
We condemn Wall Street for taking risks with our economy,
risks that all of you are working very hard to reverse,
but at the same time we're taking exactly the same type of
risk with no up side whatsoever with regard to our climate,
failing to practice even the most basic risk management
techniques in terms of climate change reduction.
We talked a lot in this issue about us and we,
and as all of you know, this is not about us.
This is about our children, and this is about our children's children.
When our children are born, we know at that moment in time that
there isn't anything in the world we wouldn't do for them,
and as they grow, we know for certain that we'd give up our
lives for our children.
For some reason, we won't do this.
We're cheating them out of their future,
and we're doing it with our eyes wide open,
and that's exactly how history will judge us if we don't pass
comprehensive energy and climate change reform now.
Thank you.
(applause)
Mr. Vieau: Wow.
Good morning everyone, and thank you all for being here,
and thank you Secretary Chu for allowing me to step up,
and I guess I found out this morning that I'm a vignette.
(laughter)
So we'll tell our story, and certainly we're proud to be here
with leaders of one of our largest utilities certainly
speaks to the importance of today's discussion.
A123 is a great example; I think a great example of American innovation.
We have our roots at American University at MIT,
a technology that we license from there.
We got some of our first funding in the form of a SPIR,
small business grant from department of energy,
and we work cooperatively with the DOE over the course of the
last eight years, and we've been driven by an American
entrepreneurial spirit that has propelled us forward to where we
are today.
And where we are right now is that we have --
we're at the forefront of a new advanced battery industry,
and it's all based on new advanced lithium ion technology
that's allowing us to have different ways to store energy,
actually to produce energy in some ways, and to use energy.
We're allowing ourselves to have cleaner cars with less
dependence on fossil fuel, and to help performance of the grid
so it can sustain and work cooperatively with new forms of
renewable energy generation, like wind and solar,
helping with the variability that's natural to those energy sources.
We're not alone right now in this endeavor to participate in
this significant market opportunity.
We have a number of large international competitors that
have been very, very well financed and supported by their
local governments, and I think as we look at this,
it's not game over, it's game on,
and we certainly hope to compete on a global basis,
as well as help build jobs in America.
It's not about politics.
It's about people and jobs, and it's an opportunity to grow those jobs.
And we have new facilities in Michigan that are adding jobs
today, we believe we will add thousands of jobs,
and what is a really great example of cooperation between
private and public sector.
These jobs are going to bring, we believe, financial stability,
but they are clean energy jobs.
And for our people who have been in technology all their lives,
there's something special about being able to not only do
something different and game changing but do something that's
going to make this a better place to live and a cleaner environment.
Our priority right now, day one, two, three,
is to ramp up production to meet global demand.
The U.S. base production is at the core of that,
and we're going to grow our research and development
facilities in Michigan and Massachusetts and elsewhere as
part of a long-term plan that we've got to build on our supply chain.
But as anybody here that runs a business, and many of you do,
knows that if you're going to make effective long-term plans,
you got to understand the rules of the game.
And it's important that we have a national energy policy that
adds clarity and definition to the longer term prospects of
this clean economy and new energy activity.
So I urge the congress today to pass a comprehensive energy
legislation that removes the guesswork for business and the
uncertainty that represents an impediment to our long-term
growth in this particular area, and will help us remove our
dependence on fossil fuels overall.
And by doing so, I think we're going to open up the playing
field for American initiative, American innovation,
and American businesses that will drive what we will consider
not only possible, but sustainable,
energy activity in North America in the future.
Thank you very much.
(applause)
Mr. Doerr: My name is John Doerr, and I have the privilege of
introducing to you Secretary Chu.
There's two really great Americans who've won Nobel
prizes who have had a powerful impact on me and all of us and
on this conversation.
One is Vice-President Al Gore.
He brought this issue front and center around the world.
But the second who is actually moving on this issue is
Dr. Steven Chu.
When Steven Chu was announced as the next secretary of energy by
the President, I thought to myself, this is brilliant;
this is the best appointment that we possibly could have made.
Steve is smart, Steve is funny, Steve is energetic.
I wanted a meeting with Steve on a couple days notice,
he was out in California.
I really couldn't get it, except he was going to ride for 25
miles the Portola loop around Stanford campus.
So I got on my bike.
I'm a 25-mile-a-week, 50-mile-a-week rider,
and this man smoked me.
(laughter)
It's a great privilege to introduce to you Secretary Chu
with one of the most exciting jobs leading our nation,
making this new clean energy future happen.
Steve?
(applause)
Secretary Chu: Thank you, John.
Let's see how we're going to do this.
I hope this works.
Anyway, I hope you can read all of this.
Essentially what we really need in the coming decades is a new
industrial revolution.
We need it for our increased competitiveness globally,
we need it to decrease our dependency on foreign oil,
and we need it because of climate change.
And so with comprehensive climate and energy bill,
we can set the country in the right direction for this so we
can lead in this new industrial revolution.
This, I think you all know about,
this is our production and consumption of oil.
The production peaks somewhere around 1970 in the United
States, and it's going down, where its dependency has
increased now up to about 60%, and that's hundreds of billions
of dollars a year being shipped abroad.
The impact of climate change globally is with each successive
year becoming better understood, I commend you to read this report.
It's a summary of a number of reports,
including the IPCC reports, but it's a summary of what might
happen in the United States.
And let me just give you an example of that.
If you take as a base period of time 1961 to 1971,
this is the upper left-hand corner of the slide;
it tells you what the temperature was like in the
United States.
For example, in the city of Chicago,
maybe a few days above 90 degrees.
In the business as usual, the upper higher mission scenario by
the end of this century, we're looking at a Chicago which might
have 75 to 90 days above 90 degrees Fahrenheit.
And in St. Louis you're looking for one-third of the year above 90.
Even in the lower mission scenario,
you're seeing a significant number of days on the scale of a
month and a half above 90 degrees.
This has a profound impact not only on the number of heat
related deaths that would occur in metropolitan areas,
but a profound affect on agriculture.
It's also predicted that there will be less rain in the summer,
more rain in the winter and early spring in the Midwest,
more evaporation in the summer, less rain in the summer.
So in much of the middle part of the United States,
our Greenbelt is not irrigated, and so that will be a tremendous
stress on our agricultural productivity.
So those are some of the things that we're looking towards if we
don't get moving.
Another thing is how are we doing on this race for the new
industrial revolution?
Well, so far not so good.
This is worldwide shipments of solar photo (inaudible),
the U.S. market share which peaked at around 45% is now
declining and is less than 10% today.
This is not only true of photable-tags,
if you look at many of the other sectors, automobile efficiency,
the batteries, right now we're hoping that companies like AB
123 and others will actually come back,
but right now if you buy, for example, a hybrid car,
99% of those batteries are made in Asia.
Electricity transmission, Westinghouse and Edison were the
first to bring electricity transmission distribution into the world.
We are behind in that power electronics, nuclear power,
and so on.
Every technology we're being slipped by on.
Now, China, I went to China about two months ago,
and I had the privilege of going to China two years before that,
and both times I talked to the Premier of China,
one had to do with the release of a report,
how does the world transition to sustainable energy,
that I had a privilege of co-chairing,
and this last time as Secretary of Energy,
when I talked to Wen Jiabao about the first time 2.5 years
ago, he talked about how they are going to improve in energy
intensity and things of that nature,
this time it was different.
This time -- of course energy intensity.
First, they were making great strides,
but he said the climate -- if we continue business as usual
trajectory, the effects of climate change would be
devastating on China and the rest of the world,
that our use of energy and our growth in energy is
unsustainable, our use of coal is unsustainable,
and we have to diversify, and we have to do all the things.
And oh, by the way, this is going to be a basis for economic
prosperity in China, not only for exports but also for
internal consumption.
And China has replaced the United States as a leader in
high technology manufacturing.
There is no reason why we should be allowing this to happen.
Their goal, very aggressive goals,
10% of electricity from renewables by 2010,
and 15% by 2020; enormous investments.
The state grid, which is a public company,
amalgamation of a lot of local companies and distribution and
power generation, they are going to be investing $88 billion by
2020 in ultra high voltage transmission lines,
they've got a million volt AC transmission line,
they are installing a 800 plus minus 800 kilovolt DC
transmission line that could port energy 1,900 kilometers
from the west where their renewable energy is to the east
where their population centers are with a 5 to 7%,
they are expecting a 5 to 7% loss in energy over that distance.
So they are leading the world in this stuff and they are making
these tremendous investments.
Just wind and solar is going to be a $3. 5 trillion market going
into the future.
And so this is something which we should be aiming at.
China is certainly aiming at that.
They have a memorandum of understanding for an American
company to build a plant in China for 2 gigawatts of solar
for utility scale generation.
So these are some of the things, and if we don't realize first
there's a climate imperative but there's also an incredible
economic opportunity that we might pass by if we don't send
the right signals.
Now, the Department of Energy has been given a lot of
responsibility in stimulating the economy also,
but most of the money that we've been given to stimulate the
economy is being focused on rebuilding a much more efficient
infrastructure in the United States and also to spur on new businesses.
And so we are -- we've created a financial institution
partnership program; we think that $4 billion of recovery act
money would support $32 billion in loan guarantees and create 40
to $50 billion in project investments.
So this is a highly leveraged money.
So the federal dollars are going to be bringing private sector
money that's been seen on the side lines back and part of this
is the firsts (inaudible) is going to be for conventional
renewable energy projects, and we've seen this in the past.
We're streamlining the process.
If the bank has a lot of skin in the game,
it's going to have at least 20%, and it's going to be more.
That's another 16.
And they do due diligence on those loans.
We're saying, that's good enough for us.
So we don't have to add another couple of months to a year of
due diligence.
And so again, very quick, in the 1603 money,
where we give the companies -- instead of stringing out the tax
credits of renewable energy over 8, 10 years,
as soon as they turn on the wind generation or the solar farms,
we give them the money up front.
Many of those companies take -- took the money and reinvested it.
Again, highly leveraged.
And in two instances I heard of two companies that immediately
reinvested 2-1/2 billion dollars private sector money back into the stuff.
And what's really nice about that is they got the money 21
days after the application, the money was wired to their
checking account.
So we're trying to go a little bit faster than I can ride a bike.
(laughter)
The -- one of the things that we're pushing very hard on,
and I'm sure all of you know about,
is that you need -- in order to get renewable energy and energy
efficiency and all these other things,
you can't have on again/off again fiscal policies,
and so we're pushing very hard so that you get a 10 year or 20
years outlook on what the goals are,
and this is a good example of you have on again/off again
production tax credits for wind generation, for example.
You see the same behavior, and as soon as you stop fooling
around with this on again/off again stuff,
then you see real growth.
And it was that long-term state investment that actually allowed
Europe to over take us in wind generation technology.
And so, again, it's things like that that are very important.
But the most important thing -- you know,
there's lots of carrots that we're contemplating in the
energy bill, but you also need a very long-term signal,
and the long-term signal is that you are going to put a cap on
carbon and a long-term decline in the carbon emission in the
United States.
And it's that long-term signal that will begin to drive the
most serious investments of investments of power companies
that we're going to have to sit there and say, okay,
this is now for real.
If you give people carrots, they will grab at the carrots and
munch on them happily, but unless you have a long term
signal that says, okay, allocations will run out,
and then you see that, and it's going to be --
the carbon cap will be marching down,
and that will drive the investments of sustaining a new
power plant.
It's a 1 to 2 billion dollar investment in coal plant.
That will create some serious thinking,
because that plant will be up for 50, 60 years.
And whether -- and that will create a big incentive to get
really serious about capturing the carbon in these power
plants, as an example.
So this is very, very important, and it's the most vulnerable
part of a comprehensive energy climate bill,
because it's the part that really means something in
long-term, and that's that long-term signal,
and that's why it's the one that is so vulnerable.
The rest are just carrots that people can happily grab at.
There are many examples of clean energy transition.
In fact, this has taken when President Obama was president
elect and there's this bolt company in Ohio that makes these bolts.
You need 1,500 of these bolts in a typical large wind turbine.
I've got one sitting on my desk, it's 10 pounds,
it's a mother bolt, it's using the steel production
capabilities in Ohio, but it's a high tech steel, very,
very high strength steel that is now incorporated in all the wind
manufacturing, turbine manufacturers in the U.S. and
foreign manufactures are adapting it.
So again, we're bringing back, manufacturing back in the United States.
This is one small example, but we've got to do this in all the
sectors where we've lost leadership.
Finally, let me just mention energy efficiency.
There was a recent McKinsey Report.
They were a bit optimistic, but I would like to --
well, I should preface this by saying if you look at the EIA
reports, for example, of what we could achieve from energy
efficiency, it's more pessimistic than the McKinsey Report.
But I would love to see the McKinsey Report come true.
And we have to take concerted, aggressive sustained effort in
order so that we can achieve the energy efficiencies and the
money savings.
McKinsey was talking about a 26% reduction in the primary
consumption of energy in The United States,
just in energy efficiency alone.
And when we stop wasting money on energy, that --
first, the rebuilding of the American infrastructure,
reinvestment in homes, commercial buildings, Subtitles End: mo.dbxdb.com