Energy Capital Podcast

Texas has long been an energy powerhouse, but the grid is facing unprecedented challenges. Between surging demand from industrial electrification, hotter summers, and data centers and the retirement of aging power plants, we need more advanced firm power sources and we need them fast.In this episode of the Energy Capital Podcast, I sat down with Doug Robison, the founder and president of Natura Resources and former oil and gas executive, and Rusty Towell, founding director for Abilene Christian University's premiere research project called the NEXT (Nuclear Energy eXperimental Testing) Lab. Natura, in partnership with ACU, is pioneering molten salt reactors, a next-generation nuclear technology that promises higher efficiency, greater safety, and the ability to scale quickly.Unlike traditional nuclear plants, which operate at high pressure and require massive containment structures, molten salt reactors run at low pressure, eliminating many of the risks and cost barriers that have made nuclear difficult to scale in the past. As Doug puts it, “Remove pressure, and everything changes.”That’s exactly what Natura is doing in Abilene, where their first 1 MW test reactor is set to go online by 2026-2027 — only the second advanced research reactor ever licensed by the Nuclear Regulatory Commission (NRC). This small-scale demonstration is designed to prove the technology and pave the way for full-scale commercial deployment around 2030.But nuclear isn’t just about electricity, it’s about heat. These reactors operate at twice the temperature of conventional nuclear plants, making them ideal for industrial applications. Texas is a perfect fit for this technology, not just because of its growing energy demand, but because it has the infrastructure, workforce, and industrial needs to scale it rapidly.One of the biggest takeaways from our conversation was how capital, not regulation, has become the biggest bottleneck. The NRC has already issued Natura a construction permit, and the policy landscape is shifting, with bipartisan support at both the federal and state levels for advanced nuclear. However, deploying reactors at scale requires massive investment and as Doug Robison points out, that shift is only just beginning.With demand projections skyrocketing, from AI data centers to large-scale industrial growth to cooling load in increasingly hotter summers, Texas will need every tool available to ensure affordable, reliable, and clean energy. The question isn’t whether nuclear will play a role, it’s how fast we can get there.This is one of the most exciting energy conversations I’ve had, and it’s a must-listen for anyone who wants to understand how nuclear could reshape Texas’ energy landscape.As always, please like, share, and leave a five-star review wherever you listen to podcasts. Your support helps bring these critical energy conversations to more people.Timestamps* 00:00 - Introduction* 02:30 - Natura’s technology, what’s different about a molten salt reactor from the typical high pressure reactors* 08:00 - Timeline to deployments, milestones met so far* 13:00 - Use cases and modularity, size of deployments * 18:30 - Policy in nuclear development & comparative advantages of Texas* 25:00 - Learning curves and cost reductions for nuclear* 31:00 - Exploring molten salt reactor technology with flexibility & scalability* 36:00 - Nuclear’s role in the future of energy demand in Texas* 38:30 - Policy support for nuclear energy * 43:00 - The role of utilities in nuclear energy, and the differences in competitive markets* 47:30 - The Role of subsidies for nuclear energy* 50:00 - The need for incentives and support from DOE’s Loan Program Office* 54:30 - Abilene: A new energy hub* 56:00 - Natura’s mission to improve quality of life, increase energy abundance* 58:30 - Transferability of skills from oil & gas to nuclear, why Landman gives the wrong impression* 1:00:00 - NEXT Lab and the first advanced reactor at a university, it’s in Abilene and it’s really happening. see below:ShownotesSpeakers, Key Projects, and Developments:* Doug Robison - LinkedIn, * Rusty Towell - Linkedin, ACU Website, NRC Website, * Natura Resources Official Website: Explore more about their projects and technological advancements. * Molten Salt Research Reactor (MSR-1) at Abilene Christian University (ACU): The first liquid salt-fueled reactor licensed by the U.S. Nuclear Regulatory Commission (NRC), marking a significant milestone in advanced nuclear research. * Natura Resources' Initiatives: There are two new initiatives, a MSR-100 energy production reactor on the RELLIS Campus at Texas A&M University and an MSR reactor for energy and desalination on the Texas Tech campus. * Texas A&M University Part of Groundbreaking Molten Salt Reactor Project* Texas Tech Partners with Natura, ACU to Advance Cutting-Edge Technology* Updated pathway to Advanced Nuclear Commercial Liftoff. US DOE Loan Programs Office.* Nuclear? Perhaps! David Roberts’ Volts Podcast.Licensing, Regulatory Framework, and Legislative Updates:* NRC Advanced Reactor Licensing: The NRC has issued new guidance to facilitate the licensing process for non-light water reactor designs, aiming to reduce regulatory uncertainty for advanced reactor concepts.* DOE's Support for Advanced Reactor Licensing: Initiatives to offset licensing costs and support the deployment of advanced reactors.* Proposed Rule for Advanced Reactors: The NRC plans to establish a risk-informed, performance-based, and technology-inclusive licensing process for advanced reactors, aiming for a more flexible regulatory framework. ​* House Bill 14 (HB 14): Establishes funding mechanisms within the Office of the Governor and the Texas Public Utility Commission to support the deployment of advanced nuclear reactors in Texas.* Senate Bill 1105 (SB 1105): Proposes the establishment of the Texas Advanced Nuclear Energy Authority and the appointment of a Texas nuclear permitting officer to streamline nuclear energy projects.* House Bill 2678 (HB 2678): Identical to SB 1105, this bill also aims to establish the Texas Advanced Nuclear Energy Authority and a nuclear permitting officerRecent News:* Companies are coming to Texas to develop a new generation of nuclear reactors. Texas Tribune.* CERAweek: Small nuclear power struggles at cusp of US electricity demand boom. Reuters.* Tech Industry Engagement: Companies like Google and Amazon are investing in SMRs, signaling a potential shift in energy infrastructure to support data centers and other high-demand sectors. ​* Google and Amazon make major inroads with SMRs to bring nuclear energy to data centers* Three Mile Island nuclear plant to reopen, sell power to MicrosoftTranscriptDoug Lewin (00:00.0)Welcome to the Energy Capital Podcast. I'm your host, Doug Lewin. For decades, nuclear energy has been stuck in place with escalating costs and only two units added in the last 20 years. New nuclear technology, though, can be modular, smaller when you need it to be, bigger when you need it to be, and inherently safer too. In fact, a new kind of nuclear reactor is being developed right now in Texas that could revolutionize industrial power, reduce waste, and even use spent nuclear fuel as an energy source. Doug Lewin (00:30.722)The Advanced Nuclear Reactor Working Group convened by the governor and chaired by Commissioner Glotfelty recommended building up a small nuclear industry right here in Texas. At the center of that hope for Texas is Natura Resources, developing a liquid fueled molten salt reactor. Today on the Energy Capital Podcast, I'm joined by Dr. Rusty Towell and Doug Robinson to talk about the next generation of nuclear power and more specifically, molten salt reactors. Doug Lewin (00:57.39)Rusty and Doug have teamed up to develop a test reactor out of all places, Abilene Christian University. Rusty is a professor in the Department of Engineering and Physics at ACU. And Robinson is a longtime oil executive who loves to talk about how the oil and gas industry skill sets apply to nuclear. It's a fascinating topic and shows how energy transition and expansion overlap. Doug Lewin (01:20.056)The U.S. Nuclear Regulatory Commission issued a construction permit for the deployment of Natura Resources Molten Salt Reactor System at Abilene Christian. This is the first construction permit for a liquid-fueled advanced reactor and only the second for any advanced reactor ever issued by the NRC. In this episode, we talk about why Texas could become the hub for advanced nuclear innovation, the policy and regulatory hurdles that still need to be solved, and how private industry, along with government, can lead the nuclear renaissance. Doug Lewin (01:49.634)The day we recorded was the day that House Bill 14, the legislature's effort to put $2 billion toward advanced nuclear deployment in Texas was filed. It has since had a hearing. I'm excited about this one because nuclear isn't just making a comeback. It's evolving into something entirely new. And it's one of the biggest stories in energy today and will be for the next decade and beyond. Stick around because by the end of this episode, you'll have a clear picture of where nuclear is headed and why Texas, that plays its cards right, could be at the center of it all. Doug Lewin (02:19.028)As always, please give us a five star rating. It really does help people find the podcast. And leave me some comments if you like the episode. I need to know which episodes you like and what you want more of. So please do give us that rating and give us your comments. Hope you enjoy this episode. Thank you for listening. Doug Lewin (02:39.586)Rusty Towell and Doug Robinson, welcome to the Energy Capital Podcast. Rusty Towell (02:43.406)Thank you for having us. Doug Robison (02:44.462)Appreciate it, Doug. Doug Lewin (02:45.612)Hey, thanks so much for being on. I'm really excited about Natura and what's going on and Abilene. So much to talk about, so much excitement around what you guys are doing. Can we just start though with like, what is the technology? Explain it to me like I'm a smart fifth grader. I think my intelligence is probably below a smart fifth grader, but I'll, but I'll reach. Go ahead and explain it to me like I'm a smart fifth grader. The technology and how what you're doing is different than the sort of what people think of as the traditional, you know, large nuclear power plant. Rusty Towell (03:15.426)Yeah. So I like to think of it as we take everything that's really good and wonderful about nuclear energy and things that people have concern on, let's improve them. Let's make them better. And it turns out that there hasn't been a lot of innovation in commercial nuclear power for the last 50, 60 years. And so it's pretty easy to do that. There's ideas, there are old ideas that we can actually start implementing and make things better. the two big changes that we're making or the reactor that we're talking about here, which is a Rusty Towell (03:45.324)liquid-fueled molten salt cooled reactor, those are the two technology choices. Let's change the heat transfer fluid. So instead of moving the thermal energy for where it's made in the reactor core to a steam generator where it makes steam to turn a turbine, make electricity with water, let's use a different fluid. And so we step back and we say, well, what's, what are the properties of that fluid we really want? We would like something that can operate at really high temperatures because we're more efficient there and we're able to provide industrial processes. Rusty Towell (04:14.84)that high temperature heat that they need. And so we want high temperature, but wouldn't it be great if we operated at low pressure because at high pressure, that's a real danger and also a real expense to engineer strong systems that can withstand that. So we want a high temperature, low pressure fluid. And it turns out when you look at that, and we also would like the fluid to not be chemically reactive or, you know, have any sort of Rusty Towell (04:42.562)break apart at high temperature or et cetera, et cetera. So a salt in liquid form is a perfect fluid. So that's what we're going to use. Take salt, melt it, use that as your coolant. The number two thing, let's put the fuel inside that salt, dissolve it inside of it instead of having solid fuel elements. So instead of having a solid fuel rod with a metal cladding around it where we use some of the fuel and then the fuel element becomes unstable and is no longer suitable for use in a reactor and we throw it away, Rusty Towell (05:11.374)and throw away lot of the energy content and throw away a lot of useful isotopes and we add a lot of material to the waste stream. Let's just dissolve the fuel in the salt, much like dissolving sugar in your coffee. And so the fuel can be added to the core, but also can be drained out of the core to shut it down. And so it makes it safer, more efficient, et cetera. Doug Lewin (05:32.318)So less waste, safer because you don't really have the danger and tell me if I'm wrong about this. This is I'll put in the form of a question. Do you not have the danger then of some kind of a runaway reaction because the fuel is actually getting dissolved into the molten salt? Is that correct? Rusty Towell (05:48.408)So you design it so that it doesn't run away by using low enriched uranium, not high enriched uranium by making sure you have a configuration where it's impossible for it to run away. You have a system that we call walk away safe because you literally can drain the fuel out of the core. So you can guarantee you shut things down. No normal reactors you shut down by inserting the control rod. And so if you can't, if something breaks and you can't get the control rod inserted, well then how do you do it? Rusty Towell (06:17.238)And so the commercial systems, say, well, we have to have a backup method in case something breaks. We have a system where we drain the fuel out. And so we literally have a system that's walk away safe because if the reactor operator walks away, if power is lost, if the computer shut down, if, if, if, if as long as gravity works, it can shut itself down. Doug Lewin (06:39.246)Okay, I'm going to go to Doug in a minute to add anything to this, but then also you have less water use, higher heat, right? Rusty Towell (06:46.168)Yeah, I mean you can make systems where you don't need any sort of water in the coolant or you can depending on how you want to convert that thermal energy into electricity. You could have a variety of systems there where it could be used on that end of things. But certainly in the power production, you don't use any water. Doug Lewin (07:01.036)Doug, I'm going to go to you next. You can add anything to that answer, but I would also love for you to talk about sort of where you're at in the process right now. I believe there was a construction permit issued by the Nuclear Regulatory Commission, which is obviously no small thing, a major thing. Add anything to Dr. Tal's answer that you want to, but also just kind of talk to us about timeline. where are you in the timeline and how long before we actually have one of these advanced reactors running in state of Texas? Doug Robison (07:29.144)The only thing would add to what Dr. Tao had to say on the system is that just to reiterate the importance of a low pressure or zero pressure system, changes from a safety standpoint, that changes everything. And so the large, extremely large forgings that you require, we do not require that. The containment dome that you see on light water reactors, we don't require that because we don't have pressure. You remove pressure and everything changes. And so that one fact, Doug Robison (07:57.962)and not even begin to talk about waste. You know, we don't generate the waste that you see with current light water reactors. In fact, we can re-utilize that spent nuclear fuel as fuel for molten salt reactors. So we don't have to throw that fuel away. We can keep it and use it. But the low pressure aspect, the walk away safe aspect is directly beats into your second question on what is the timeline. So the timeline for the demonstration reactor, the reactor at ACU is for Doug Robison (08:26.03)For licensing purposes and for the purposes of the universities, it is a research reactor. It is the country's first advanced research reactor in the history of the nation. Very valuable for that. For Natura's purposes, it is also a demonstration reactor. It demonstrates licensure, so we have already demonstrated with the NRC that we can get a license. We got our license in September of last year. It's the first time the NRC has ever licensed a liquid-fueled reactor in the nation. So a huge accomplishment. Doug Robison (08:54.892)made by the researchers at the four universities on that. That demonstration or research reactor is scheduled to become critical or go online the end of 2026, early 2027. So very likely we'll be the first advanced reactor to be operating in the United States, I guess since the 1960s, Rusty, if we go back to the Oak Ridge days, but under the Nuclear Regulatory Commission's period of existence. Natura, one of our goals is how do we get the Doug Robison (09:23.512)production as quickly as possible. Production is deploying commercial reactors. So last year I started saying that we have a defensible pathway to deploy commercial reactors before 2030. Since that time, a lot has happened. The pace of change in this area is incredible. My certainty of deployment before 2030 is going up. And I believe at that time that is getting closer and in one large Doug Robison (09:50.324)aspect of that is the Nuclear Regulatory Commission that is often criticized for the stringent bar that they set to deploy reactors. Natura, we actually lean into that and say that that is a good thing. We are deploying nuclear reactors. We're not building stepladders. And stepladders require federal approval also, by the way. And so a very, very high safety standard should be the norm. If you can't reach that safety standard, then maybe you shouldn't be building a nuclear reactor. Doug Robison (10:18.766)So we think that is a strength of the NRC to be leaned into. And what the NRC is doing, there were hearings over the last two days as a matter of fact, and we've had three of the five commissioners come through Abilene and tour the facilities there, the Science Engineering Research Center. The NRC is leaning in into what does advanced nuclear provide in terms of new licensing regimens. There has been discussion recently about microreactors and those are very small reactors. Doug Robison (10:48.534)Are they somehow different than the large lab water reactors from a licensing and safety standpoint? All of the arguments that are being made for micro reactors can be made really in all caps for molten salt reactors because of the walk away safety aspect, because we don't deal with pressure. And so we were having in the tourists, having a series of conversations with potential industrial partners. had one just as this very afternoon, about an hour before this podcast. Doug Robison (11:18.376)with a very large industrial entity. And the conversation was we're presenting to the NRC technology that could open up new licensing pathways that are going to require the years and years that we've seen on light water reactors. I can't sit here today and say we're going to license a reactor, commercial reactor in the next four years. What I can say is that industry, Natura is leaning in. Doug Robison (11:47.33)The state of Texas is leaning in and saying, we need you to move faster if the NRC is leaning in. So if everybody's leaning in, then you feel like you're going to be finding a faster way to do things without compromising on the safety. I've got to emphasize that over and over. We're not seeking compromise on safety. What we're doing is because we have a passively safe system that never goes to pressure that the, the, the fuel goes because it's in the salt as Dr. Tao explained. Doug Robison (12:17.112)we go from a solid to a liquid to a solid, the ability to contain that is much different than it was for high pressure light water reactors. And so we still have a defensible pathway to deployment of commercial reactors before 2030. Again, I think that timeline could be getting shorter. And then the number of your reactors you deploy at that point is just simply a bunch of the capital. You're going to deploy one every... Doug Robison (12:42.978)Two years, are you going to play 20 in the first 24 months? That's just a function of capital and the long pole of the tent. I actually before a few weeks ago, before some of the meetings we've had in New York and Salt Lake city and some of the testimony going on at the NRC, I might've said the long pole in the tent, the long timeline continues to be the licensing timeline. I now think that the long pole in the tent is actually the capital. When is the capital available? Doug Lewin (13:09.24)So let's talk a little bit about how the use cases for this and the size of this. So you're doing a one megawatt test reactor, large nuclear plants, at least the four we have in Texas are all about 1200 megawatts. We have lot of obviously lot of listeners that are energy professionals, but we try to make this as accessible to a general audience as possible too. Doug Lewin (13:33.144)So to put that in perspective, know, a small city like Waco or Lubbock might be not small city, mid-sized city, sorry, Waco and Lubbock, you know, seven or 800 megawatts, a city like Austin, about 3000 megawatts, San Antonio, about five or 6,000 megawatts. These are smaller by design, right? So that they could be used at an industrial site or at a campus. Is it one size or is there kind of a range of size that Natura's reactors could be? Doug Robison (13:59.49)The reactor at Abilene Christian is a one megawatt thermal that is a limit set by the Nuclear Regulatory Commission for a liquid fuel research reactor. The Natura commercial reactor we're staying within, definition of a small modular reactor, one of those definitions being you can fit everything on the back of a semi. So that becomes our limitation is the reactor core can be no larger than what you can transport on the back of a semi trailer. Doug Robison (14:26.446)Dr. Tao, you'll know the measurements better than I, but the reactor vessel, not just the core, but the vessel itself is, I don't know, 14 feet wide or something like this. Rusty Towell (14:36.974)The reactor we're deploying here at ACU, it's about 10 feet diameter and 20 feet high cylinder is sort of everything that has fuel inside of it all lives inside of that one system. Doug Robison (14:42.072)Thank you the... Doug Robison (14:47.022)Yeah. So the commercial system, it's going to be 250 times more powerful is 14 feet wide and then maybe 35 to 40 feet tall. So if when you go up in power by 250 times, you don't go up in size by 250 times. And so while we end up within that limitation of size, within the limitation of the fuel that we're using, because we're for our commercial reactors, we're using LEU plus because of the shortage of HALU. So we're not planning on having HALU available when it's not commercially available. Doug Robison (15:16.942)is a 100 megawatt electric, 250 megawatt thermal. Doug Lewin (15:21.26)What you hold on, hold on, hold on one second. Okay. So 100 megawatt electric, 250 megawatt thermal. So for a lot of industrial applications, what you're doing is you're using like steam and waste heat. Is that what you're talking about here? Okay. Okay. And so 100 megawatt electric and then another 250 that can be used on site for that industrial process or for commercial use, whatever. Doug Robison (15:38.166)Exactly right. Yes. Doug Robison (15:48.43)Right? That's right. We have two commercial projects that have been announced. One is a primary heat project. It's desalinating produced water in the Permian basin. And so because the salinity of produced water is triple that of seawater, membrane technology really doesn't function at that. So they're looking at thermal energy. So that's where we would bring the high process heat. We have a second deployment that's been announced on the RELLIS campus at Texas A University that's providing power. Doug Robison (16:17.698)providing electricity. And so we actually, coincidentally, but fortunately, have two commercial projects that have been announced, and one focusing on the heat aspect that molten-salt reactors uniquely operated, very, very high temperatures, but again, very, very low pressures. We can take advantage of that high process heat, and then we have another on the RELLIS campus that's just a pure power reactor. Doug Lewin (16:39.618)But for the one at RELLIS, so that would be electric, but somebody's going to presumably use the thermal output as well, right? Because the thermal output is there by design, right? Doug Robison (16:49.228)Well, as with any reactor, you turn heat into electricity. You end up in a power block where you take that heat, ultimately transfer it to water that creates steam away. Now this is not near the reactor core, so we're not introducing water into the reactor core through a heat transfer through a non-fuel salt. And then that water you do use to create steam and turn a turbine and make electricity. So yeah, any reactor is going to generate heat that you turn into steam. Doug Lewin (17:04.781)Got it. Doug Robison (17:17.846)We just happen to generate heat at more than twice the temperature of a current light water reactor. So we operate up above 600 degrees Celsius. But again, we never leave the liquid state. Doug Lewin (17:28.652)Okay, great. Doctor, tell me anything you want to add to that. Rusty Towell (17:32.098)No, well, I just say that, you know, any sort of power plant, virtually starts with a heat source, right? Whether you're burning coal, natural gas, concentrated solar, et cetera, it's a heat source. And then converting that thermal energy into electricity is something that we've been doing for a long time and we're efficient at, but there's also laws of physics that say limits how efficient you are and at lower temperatures, you're not as efficient. so current nuclear power plants and current reactors that are water cooled. Rusty Towell (18:01.43)or where water is your heat transfer fluid, you throw away more of your energy into waste heat and produce less electricity. We'll produce almost 50 % more electricity from the same amount of thermal energy by being able to operate at high temperatures. So that's just a benefit of operating at high temperature. You actually throw away less energy and actually can use more in form of electricity. Doug Lewin (18:22.894)Okay, great. So I do want to talk some about policy. Obviously, this is Energy Capital Podcast. We always talk about policy. We are recording on March 6th, which is the day that House Bill 14 has been filed. And I was looking through it a little while ago and was struck by how they actually called out something that Governor Abbott's Advanced Nuclear Reactor Working Group called out as well, high wage manufacturing jobs being part of this. Can you speak a little bit to the economic development aspects of this? Doug Lewin (18:51.148)You know, there's obviously a global market for energy. There's competitiveness around the world. It seems to me like, and I want to make sure I'm viewing this the right way, but there's a, there's a competitiveness angle here too. Like nobody else is developing exactly what you're developing anywhere else in the world. Is that right? Doug Robison (19:06.99)Anywhere else in the world, rusty, I think China is pursuing this technology. When the department of energy asked us to take this project on in 2019, the reason was given that we need to beat China and we need to beat Russia. So I wouldn't say anywhere else in the world. Now we'll say anywhere else in the United States, certainly. Rusty Towell (19:26.414)Rumor coming out China, they have a reactor, they got it operational full power last year. Very, very limited information coming, but certainly this is a technology that's interested worldwide and there's people that are working on China. In the West, there's a variety of people that are interested in it, but if you step back and say, are you interested or do you actually have a construction permit to do this? That's a very, very different question. And so if you say, do you have permission to actually build a reactor? All of a sudden there's a very, very small field of Doug Robison (19:54.158)Doug Robison (19:55.138)So I was appointed by the advanced nuclear working group by governor Abbott and served in a leadership role in that. We submitted our recommendations to the governor's office in November of last year. And then what the governor's office rolled out, I believe in December, late November, the 13 recommendations that came out of the working group were comprised down into seven points that the governor issued. And then we have this house bill 14. Doug Lewin (19:55.544)Got it. Doug Robison (20:22.894)that is encompassing some of that. And we're going to see how that works to the legislative process. The two directives that Governor Abbott gave us in August of 2023 was one, we need more dispatchable power to reinforce the grid. And that was the overriding priority. Texas has a grid challenge. Doug Robison (20:45.418)as well as the water challenge. I don't know if you want to talk about water later, for sure. But those two infrastructure issues are before the legislature. We saw Texas put $5 billion in the Texas Energy Fund last session, trying to address dispatchable power, primarily through natural gas. We may see another $5 billion this session for another add-on to the Texas Energy Fund. We have $2.5 billion. Doug Robison (21:08.77)Currently in the House and the Senate, both addressing water, which one of the key components is the ability to desal water is where you're to get the power. So we kind of reintroduce our technology at that point. And then we have this House Bill 14. I haven't had a chance to read through it. Just got it this afternoon. And I know it lays out many of the things about what the governor or what the work group came up with. I don't know if it has a dollar amount in there. I don't know if that has been given to us yet. How much the governor's office. Doug Robison (21:38.056)Our chairman Harris, who's sponsoring that bill, is recommending to put into nuclear what the competitive edge. There's 20 other states that are kind of saying the same thing. is saying we want to be the center of advanced nuclear. The Texas miracle is built upon the fact that we have the Permian basin and we have the Barnett shell. We are fortunate enough on the Barnett that's natural gas. The Permian basin is crude oil. We're blessed to have that rock. Doug Robison (22:06.958)in those formations in the state of Texas. That's why we're able to provide all of that power, all of the economic growth, again, the foundation of the Texas miracle. Advanced nuclear is not based upon formations. It's based upon whichever state becomes the center for manufacturing. So the second point of the governor's letter in August of 2023 was capture this industry for Texas. Texas has a manufacturing history. We're comfortable with energy. Doug Robison (22:34.39)In the four plus years that this project has been ongoing in Abilene, Abilene Christian and Natura have sponsored more tours and town halls that we can remember. We've not had one single voice of dissent or concern. It's been nothing but unmitigated support and excitement about what this could mean. I think Texas A is experiencing the same thing on their RELLIS campus initiative there. We have the manufacturing capability. Again, because we're not high pressure, we don't have to go overseas for forgings. Doug Robison (23:03.872)heavy forgings, we can manufacture back the facilities we're using at Abilene Krish and the test facilities were manufactured outside of Abilene. And you go to, you go into Houston and of course we can build these things. Texas has all of the components. We have the need, we have the history, and we have the blessings of a huge surplus that allows the state to step into this much more than say a Tennessee who Tennessee has some natural advantages. have Oak Ridge National Lab. Doug Robison (23:33.678)Yeah. And they've got the Tennessee Valley authorities. So they kind of got two runners on base already, but Texas from what the governor has said, what he said in the state of the state address about leading the nuclear Renaissance, what the legislature, what the state leadership have said in the interim, we'll see what plays out in this session under house bill four and other different appropriations that are working through the state that are directed toward advanced nuclear. So time will tell. Doug Lewin (23:34.088)Right, right. Doug Robison (24:03.266)But we know what the governor asked us to do. We know what the opportunities and possibilities are. Now we'll see how the legislature chooses to address it. Doug Lewin (24:10.988)Yeah. And I think there's so much, I think you're right, Texas has a lot of natural advantages here. And I think with tapping in at Abilene, there's the kind of potential there for that, you know, even first mover advantage. And, you mentioned Oak Ridge, you know, I interviewed Governor Perry for this podcast and he talked about how he was going to, he said on the podcast, he was going to talk to Secretary Wright. At that point, he hadn't been confirmed yet, but of course it's been confirmed since that Texas needs a national lab. Doug Lewin (24:38.51)I'm just gonna put that out there. I'm gonna keep saying it on this podcast. I'm gonna try to drop it into every episode. I mean, there's something like 20 years, like why do we not have a national lab for energy in Texas? It's kind of wild, right? Doug Robison (24:50.466)I think we had the chance with the super collider maybe and we blew that. Doug Lewin (24:54.454)Right, Doug Lewin (24:54.935)right, right. That's a topic for another day, We'll let you know. If this were one of those like three hour podcasts, we could get into that. Rusty, I want to ask you, it seems to me like with nuclear, the thing that has kind of always been missing is a learning curve, right? That like, you you've seen huge reductions in the cost of solar, in the cost of batteries, in the cost of LED light bulbs. could, heat pumps, I could go on. Doug Lewin (25:20.934)But we really haven't seen it in nuclear. Do you think there's the potential there that we could actually see? Because obviously cost is going to be potentially a limiting factor for nuclear. Can we get to where we get some kind of a steep learning curve on nuclear? Rusty Towell (25:33.934)Oh, absolutely. We certainly can do that. And I'll just go back to where I started. The fact that we're working at low pressure means we don't need that huge, thick reactor vessel and the huge containment dome and those huge forgings that Doug was talking about. And so we have a great starting point. And then let's bring in this concept of small modular reactors that Doug was talking about. Let's build our components not on site where we have to move a workforce. Rusty Towell (26:02.84)from side to side every time. we see this, right? I I love the fact that Vogel was completed and we got a new pressurized water reactor on the grid producing clean, safe, reliable energy. But it took 15 years and something like a workforce of over 9,000 people to build that thing. And so it was way over budget and behind schedule. Ford, 100 plus years ago, right? I mean, let's build in a factory. Rusty Towell (26:30.264)where you get a trained worker to build one part really high quality, you know, knows what he's doing and let's get the efficiencies of mass producing. And so we mass produce the modules in a factory and we get a single design that we licensed once and then we build a bunch of, and then all we have to do is, it okay to put it in this side? Yes. Let's build a, you know, a building like the building I'm standing in that was built, you know, in a year and a half. Rusty Towell (26:59.15)you know, with no special dome over the top of it. And all of sudden we have a place where we can deploy a small modular reactor. And so this allows us by all means to get down to that economies of scale so that we can truly make the one budget and on schedule where it's a sustainable form of energy from a market analysis point of view. Doug Robison (27:12.877)Nuclear. Doug Lewin (27:20.802)Yup. Doug, anything you want to add to that? We're do- Yup. Doug Robison (27:23.022)Doug Robison (27:23.562)The demonstration reactor, when we met with the DOE in January of 2019, and they said, you need to build this reactor. And that led to the end of my retirement with that sentence. We laid out the pathway of utilizing, which had never been done before. And there's so much that we, we use that phrase so often, I think people quit believing us at some point. But one of the things we've never done before is we've never had a private company like Natura, fund a research reactor at the university. So that was a burst. Doug Robison (27:52.418)But the reason for that was that we were utilizing the research reactor program as a way to bring new technology to the marketplace. That had never been done before. Now the DOE's response was, that's a genius. This may be the future of research. We're seeing other universities now kind of holding their hands up and saying, Hey, we want to do the same thing. And we'll see if some of them are successful. Hopefully they are. But then in fact, the conversations we're having about how fast can we move is Doug Robison (28:19.542)We're not having to forecast or predict what it takes to do front end engineering design or detailed engineering design or preliminary engineering design. We don't have to predict what it's going to take to prepare a construction permit and to defend it and to get it permitted because we've done all of it. And the evaluation, the analysis that really began once we got the permit in September of last year, my question to the team was how Doug Robison (28:44.854)mature are we on our commercial reactors based on all the work we've just completed internally with the Nuclear Regulatory Commission? And the response coming back is we're way down the road. So when we talk about what does it take to do all the design work, all that R &D, all that licensing work, even the manufacturing, we're already establishing under EPC agreements exactly who's going to be providing components. So we have answered those questions. Doug Robison (29:12.302)So they're not new questions that we have to predict about. We can actually say with certainty, we know how to do it because we've done it. So when we build our first commercial reactor, our first of a kind, it is actually not our first of a kind. Our first of a kind is going to be sitting about 50 feet from where Dr. Tao is sitting right now. The demonstration reactor, the research reactors are being deployed at ACU. One of the primary purposes of that pathway is deploying that reactor at ACU so that Doug Robison (29:39.694)we can move again, how fast can we get to production? I come from the oil and gas industry. My company grew through the drill bit. What that means is you grow by drilling. If you don't drill, if you don't produce, then you die. How fast do we get to production? How fast do we deploy reactors on the grid? How fast can we get licenses from the NRC to do that? So our pathway has proved successful. And we were not in existence before the middle of 2020 and within two years. Doug Robison (30:09.516)We had accelerated to the lead just about everybody out there. And now four years later, we're only one of two that have a permit from the Nuclear Regulatory Commission. Doug Lewin (30:19.65)You know, it seems, so it seems to me like really the key here for so much for deploying this quickly, for building an industry here, for having a learning curve really is that modularity. You keep remembering, I bring this up in a lot of conversations and we'll put a link in the show notes. There was a great podcast that Jigar Shah at the time, the head of the loan program office at DOE. And I want to talk about DOE and the sort of bipartisan nature of this because it has support, it seems across administration. So we can go there in a minute, but Doug Lewin (30:48.334)He was on Dave Roberts, Volt's podcast, and he said, the problem with SMR so far is small modular reactors, they're neither small nor modular. that's, that seemed to be, and it seems like you guys, that's, that's not true with Natura. They are both small. We talked about the size a little while ago. They're, they're also modular and that allows for that replicability, which gives you a good shot to really come down that learning curve. I want to ask, and Rusty, think this, I'll ask this one to you first. Is there. Doug Lewin (31:17.07)flexibility in this technology. What I mean by that is, like you talked about, I mean, actually Doug was talking a minute ago about like this kind of base load dispatchable generation the governor wanted. We have obviously a large deployment of wind and solar, about 40 gigawatts of wind, about 30 gigawatts of solar. And so we have a system right now where there is an abundance of energy. And of course we have a lot of gas, right? There's like Doug Lewin (31:43.982)70, somebody, maybe 68, something like that, gigawatts of gas on the grid. So like, there's a lot of power for most of the hours. Is there an ability, I think maybe with the molten salt to actually like store up some of that power and then deploy it in a flexible kind of a way or does that not exist with this technology? Rusty Towell (32:04.462)No. So one of the beautiful things about this technology is you don't have to sort of go to economy of scale to try to make it economical, right? So pressurized water reactor where you need those big containment domes, et cetera. It doesn't make sense to invest in that sort of capital. If you only have a one megawatt, you know, electric plant or something like that, right? It just doesn't, you'll never get the return on the capital investment. So economy of scale is important to those and you have to go big. Rusty Towell (32:29.9)With molten salt reactors, you can make them a wide variety of sizes. So yes, we can make them a micro size, teeny tiny. We can make them big grid level size, just as big as the pressurized water reactors. But if we get them that big, at some point they're no longer smaller modular. And so from a business point of view, what Natura Resources is doing, they're saying, let's look at something that seems to be the sweet spot for most industry and still be truly small modular. And so we can build something that's 250 megawatts thermal. Rusty Towell (32:59.598)And so if you need 500 megawatts thermal, you build two of them. If you need electric and you need 300 megawatts electric, then build three of them, right? And so they don't take up a lot of space. They can still be dense and compact and you can put several on the same side. And so you can scale it to whatever you want. going back to your question of, go ahead. Doug Lewin (33:21.934)I was going to say, they're flexible in that sense, right? That you can deploy them in different, and obviously, and it may just be the answers, like what I'm asking is the answers. It could be no, because, that's okay, because with data centers or DSAL or some industrial processes, have chip manufacturing, you may just have 24-7 and you just want 24-7 power. What I'm asking is, is it rampable? Rusty Towell (33:43.01)Yeah. Yeah. So it, you know, does it have this ability to load follow a lot of times people talk about, so in the middle of the day, we need a lot of electricity. Can we ramp them up and at night turn them down? Yes, you can do that. like most, big industrial processor, you know, it doesn't appreciate the changes. It rather runs steady. And so one of the things that we've thought a lot about, and you actually heard it from Natura and their first two commercial deployment is that because it can produce electricity efficiently. Rusty Towell (34:11.776)And because it can produce high temperature process heat efficiently, you could easily pair it so that it does both. So one plant or one grouping of plants produces electricity and desalinates water. So you think about Corpus Crispi or someplace along the Texas coast where there's both a shortage of water and a shortage of electricity. Let's do both. And so in the middle of day, we're producing electricity. And at night, when we need less electricity, let's start desalinating water. Rusty Towell (34:40.898)Cause water goes in the tank really easy. And beyond that, could you build a thermal storage unit? Yes, you could, but that's a bigger capital investment also. You could do it. In my mind, it's not the most elegant solution. I think there's other options out there, but I think you're also right. As we go forward in time, we're going to need more and more and more stable energy. As we ramp up and we look at what's really driving the increased electricity demands of the future. It's going to be a lot more. Rusty Towell (35:09.262)24 seven and much less my air conditioner in the middle of hot day type of usage. Doug Lewin (35:14.958)Yeah, I think there's going to be, I think there's going to be both. I think like there's basically if we can, if we can produce clean and affordable power, like there's not going to be a shortage of uses for it. But I think that sort of flexibility ramp ability question is, kind of always there. But I think that, you know, we're having this conversation a year or two, frankly, I think I would have been, I would have been more skeptical of this because it just looked to me like everything was going to be rampable, flexible. think the AI data centers, but you can also get into again, industrial electrification desalination. Doug Lewin (35:44.974)there's more and more use cases coming that that 24 seven, just matches nicely. Not every electric use is that way, right? Air conditioners are going to be highly variable, but there are a lot of electric uses that are going to be 24 seven. Doug Robison (35:58.604)Well, you look at the grid in Texas and I'm sure you're familiar with our cod and the work that they've been doing. yes. know, Texas grid is about 90 gigawatts. That's the size of our grid. We're going to lose 12 to 14 gigawatts from coal coming offline. So now we're dropping down below. Texas has been struggling to maintain the 90 gigawatt. And because we have such a large percentage of renewable that contributes to, we have times when we don't have the power available. Doug Robison (36:26.318)And that's what the 5 billion last session was supposed to address. And I'm sure it's helping, but we're going to have another 5 billion this session, perhaps to get more dispatchable power on the grid. Urquhart came out and said, it's not going to go from 90. We're going to maintain 90. Now we're going to move from 90 to 110. are we going to, how are they, they came back and say, we're to go to 146. And last week they came out and said, yeah, it's going to be more than that. We're going to 150 plus. Doug Lewin (36:43.872)or higher in Doug Robison (36:55.894)In the next six years. So that's before you throw data centers and AI on top of everything. That's just electrification and growth. And now we have Stargate. If I remember the name right. The first deployment is in Abilene. So all things in Abilene, amazingly enough, if that's a 1.2, 1.4 gigawatt, and they're going to do 10 of those in Texas is the plan. There's another 15 gigawatt power on top of. Doug Lewin (37:08.93)That's it. Yeah. Doug Lewin (37:12.034)Yep. Yep. Doug Robison (37:25.322)Everything else on core has current requests for 80 gigawatt of new connection. Remember our current grid is 90 gigawatt. 60 of that 80 are data centers. So the power demands, and we're not unique in this, it's across the country. New York is now talking very seriously about nuclear. As Germany, Rusty and I, yeah, Rusty and Axie floated past, I think the last shuttered reactor in Germany. Doug Lewin (37:46.836)Absolutely. Yeah, everybody. Doug Robison (37:55.34)And now they're talking about bringing their reactors back online. Italy either today or yesterday revoked their stance against nuclear doubt. And they're now pro nuclear. The point is we need massive amounts of power as quickly as we can get it. was asked earlier is all a gas. How do they look at our project or do they consider us an enemy? say, no, they're actually, they're our greatest customer and we need all the oil, all the natural gas we need. Doug Robison (38:23.128)small modular reactors, still need the large light water reactors. So I am not worried about the demand. I'm worried about the ability to meet the demand. Doug Lewin (38:31.34)Yeah, the demand is off the charts right now. I do want to come back to policy. We touched on it a little while ago. What do you really need from policy? I I touched a minute ago on kind of the bipartisan nature of this. think it's fair to say the Biden administration was very supportive of nuclear. Jigar Shah was out there almost like cheerleading for the nuclear industry. And the NRC did issue a construction permit under Biden. And we've heard great things out of Secretary Wright. So it seems like... Doug Lewin (38:58.69)There aren't many things in the world these days that fall into this category, but nuclear seems like one of those that has support across both sides of the aisle and different parts of the ideological spectrum. And then we were talking about HB 14 as well. So that bill, know all of us are still kind of digesting because these came out today, but it looks like it's an up to $200 million incentive from the state of Texas for reactors. They've got these different tiers in there. So we'll figure that out as we go. I won't ask you to comment on a bill that was just dropped today. Doug Lewin (39:28.226)But I think the more general question, what do you need from the policy environment for this technology to really flourish and thrive? Doug Robison (39:36.024)So we did this 20 years ago with the hydraulic fracturing revolution and my company, EXL petroleum was at the forefront of that in the Permian Basin. And the way that played out, and I've given this speech a few times, I go back to King Hubbard's curve, if you're familiar with the peak oil and all that. When I started with Exxon in 1982, that was a real thing. And it was not just at Exxon, but in the state of Texas and across the nation, the production decline was a real thing. So when we, Doug Robison (40:05.644)revolutionize the oil and gas industry with new technology, new fracking techniques. The things that happened is one is that we quit drilling dry holes. And so in the nuclear world, that would mean every time you go to the NRC with a license, you're assured you're going to get a permit. If you're bringing them exactly the same reactor that they just permitted a few months ago, then your odds of getting permitted again are going to be pretty good. So we've kind of done away with dry holes, hopefully. Then what happens is the capital has to hit Doug Robison (40:35.17)table. When the private equity industry figured out what we were doing in the permanent, it took, think our third public transaction, everybody kind of all of sudden figured out what we were, we're doing because the results of those transactions were to public companies that released the data. And when the private equity world woke up, we had $90 billion trying to place in the Permian to get in on the rig, roulette wheel, if you will, you know, a game that has no risk anymore. That has been missing. Doug Robison (41:02.89)until the last several months, the capital component. Doug Lewin (41:06.092)Literally, Doug, literally the last couple of months, like not like a year or two ago, like literally in last couple Doug Robison (41:11.406)Doug Robison (41:13.388)A year ago when I spoke at us Nick, the financial industry, since then almost not that we're smart enough to plan it this way, but almost exactly what we got our permit is that Microsoft, Google and new core. If I remember the three companies that came out last fall and said, we're going to need a hundred gigawatt of power again, larger than the Texas grid. Those three companies are going to need a hundred gigawatt of power and we need it quickly and we don't want it to be carbon. Doug Robison (41:40.258)The only thing that fit that definition was nuclear. think that announcement was on a Friday. I believe there was a wall street journal article or. Advertisement the following Monday where we had a number of international banks say we're in to nuclear. So overnight you had a demand in data centers and AI saying we're going to need massive amounts of power. We're going to pay a lot of money for it. And you had the banks respond. Then what happened after that is I think the first definitive transaction. Doug Robison (42:09.858)We don't know all the details is when Microsoft and Constellation teamed up and said, we're going to reopen three mile Island. And so the data centers, the hyperscalers are grabbing excess power or dormant reactors wherever they can. I think that might be the only dormant reactor in the nation. There may be one other, but I've heard different opinions as to where the other one can be brought back online. Doug Lewin (42:33.176)There was one in Michigan, think DOE did a loan guarantee for and California had one or two. I think they brought them back though. But yeah, go on. Yeah, yeah, yeah. There's not many. Doug Robison (42:43.446)Now I'm spending much more time in New York than I'm spending in Austin. And the reason I'm going to New York is because I was just there two, three weeks ago. It's because the financial community in this nation, which is headquartered in New York is now saying, we want to learn what you're doing. We're interested. And so yes, in the last several months, the financial industry has shifted. Now the component that is still lagging are the utilities. Doug Robison (43:11.406)Utilities are not early adopters. And so we'll see how that, if you're going to try to address the grid, you have to have utilities engaged. And then you get down to, know, we saw the federal government put five billion into advanced nuclear in 2020 under the advanced reactor demonstration program. Natura, everything we've done has been privately funded. We did not exist when those dollars went out. Doug Robison (43:35.598)So we've seen a large infusion of capital there. We'll see if something results out of that. I hope it does. And now we have the states who for various reasons, one trying to capture an industry, think for a lot of states, it's just the economic opportunity, but also seeing the power need are now saying, we're looking at ways to make this happen. So in Texas, a good example is what the legislature did last session with semiconductors. We want to capture the semiconductor industry. Doug Robison (44:05.176)because of economic growth, it's a vital industry. So we're going to incentivize to make that happen. And so that's what we're going to see, what happens here in this session for Advanced Nuclear. Doug Lewin (44:15.362)And before I go to you for, want to get your thoughts on that too, Rusty, as far as what is needed from policy and what kind of government support is there. Doug, I want to just double click for a minute on that, on the piece about utilities, because isn't that what is different about Texas, right? Because there is a competitive market. So if you've got, whether it be Microsoft or OpenAI or Google or Meta or Newcore or, you know, or BASF or whatever, if you have a large user that says, Doug Lewin (44:44.974)I want to buy this power. Of course, there's like a utility hookup for the power plant, but it's not like in Georgia where, you know, it was Georgia power and the regulators had to approve it and it's all command and control central planning. Like it's a market here. If the capital is there to bring it now it's new. that's where I think some of these bills like Senate bill 1105 and house bill 2678, and some of that will be in HB 14. Doug Lewin (45:11.734)where there's a nuclear authority and a single point of contact to help with permitting and some of those utility issues. But as far as actually getting to market, that's where a dynamic competitive market is so different here than it is in a lot of other states. Doug Robison (45:29.166)Well, true. And our price is recalculated every five minutes under this gut system at ERCOT In the advanced nuclear working group, we were told, do not discuss the grid. That is not a topic that the governor wanted our opinion on. So we did not address that at all. That's within the purview of the legislature. So I don't think we'll see anything. I know you didn't see that coming out of the working group on that. We'll see what the legislature does. Now with hyperscalers. Doug Robison (45:56.896)and direct air capture and industrials. Those have, and we don't know all the details about Three Mile Island, the Microsoft and Constellation arrangement, but much of that could be defined as behind the meter, off the grid. Now, I think if you are supporting industries such as hyperscalers, data centers, that otherwise would try to draw from the grid, that that's considered supporting the grid. If that's the case, then that's fine. But we may see Doug Robison (46:26.368)much of the power coming from advanced nuclear going to hyperscalers and data centers and perhaps commercial operations. And we're still going to have to address the grid issues. So that's, that's a paradox. think the legislature is going to have to, it's going to have to wrestle with. don't, I don't have the answer other than I know that reliability is worth something and is figuring out what it's worth and then how to make that happen. think is going to be a big challenge. Doug Lewin (46:55.448)Well, Rusty, I want to go to you on policy too. I'll just say real quick. think there's, know, reliability obviously is paramount, but I think like riding right there sidecar with it, right, is affordability, right? And I think you do get a lot of affordability benefits from wind and from solar. And I think the other piece that is kind of interesting, it isn't talked about very much, but unless I'm mistaken, and I don't think I am, in the Inflation Reduction Act, there actually is now the production tax credit available for nuclear now too, including for Doug Lewin (47:24.782)Existing new so every existing nuclear plant is getting the same actually more because it runs 24 7 it's getting the same $23 a megawatt hour and you guys would be able to get that for the For the reactors that you deploy as well. Correct? It's gotta try change the X. Yeah Yeah, yeah, rusty you want to talk about policy? What do you think we need to grow a nuclear industry in Texas? What kind of policies where is important? Doug Robison (47:40.065)you're correct. Rusty Towell (47:47.894)Yeah, I think to start answering your question, no, I don't want to talk about policy. is a, that's a, a nice. Doug Lewin (47:53.975)You got that doctor in front of your name. You're not, yeah, no, come on, come on, get down in the mud with us. Talk about policy. Rusty Towell (47:59.918)Policy. mean, I, my opinion, if you have a level playing field, then the best technology will win. And so what do we, what do you need? Well, you get more of whatever you, you you incentivize. And so if you say, Hey, we care about things that don't have smoke stacks. We want to subsidize those. Well, then great then wind and solar get a subsidy. And so you say we benefit from cheap wind and solar. Well, that's because we put a lot of money there already. So if we said, what do we really want? I mean, Doug Robison (48:29.218)Sorry about ur clock. Rusty Towell (48:29.998)being Rusty Towell (48:30.238)a reliability for Texas. that I think is, especially go back to the winter story of Yuri and you ask people, what do you care about? I think they probably care lot more about reliability than they do about how much CO2 is being produced. And we can all agree we want a clean environment, but we can get there a variety of ways. And so I would love to see a policy that gives credit to reliability. And yes, I think it should be clean also. And that's the beauty of nuclear is we can be clean and reliable. Rusty Towell (48:59.126)And with small modules, I'm also very, confident that we'll be economical. so level playing field, I think in a couple of decades, no one will ever build a windmill again or a solar panel again versus less invest those resources in a nuclear power plant. And so I think we'll be all nuclear in a few decades. Doug Lewin (49:18.894)Doug Lewin (49:19.894)It's a system and I think that a diversity of resources in a system are generally a good thing. I think like with wind and solar, what you end up with is, and we're at a point now, I it'll be interesting to see what happens in the coming years, but you get these different studies that come out all the time from various academics and investment firms and all that of what is the subsidized cost, unsubsidized cost. Wind and solar have gotten pretty competitive. I do think though there is a need Doug Lewin (49:48.634)for baseload power for the kind of always on. I do think we're kind of, I feel like we're moving into an era where these arguments over affordable, reliable, clean, secure, you can actually have it all. You have to have a system where those things work together. You have variable demand, you have variable output, and you have some things kind of underneath that as like the foundation. I guess what I'm really getting at is, some of these concepts that are floating around in the bills, Doug Lewin (50:17.972)Is there a need for an incentive from the state? Is there a need for a central kind of nuclear authority that's kind of a single point of contact? Is there a need for the state to assist with some of the workforce issues? Like, where is the policy support for nuclear important and where is it not? Doug Robison (50:35.798)I think it's important in all those things. The Advanced Nuclear Working Group touched on every single point. Doug, that you just made, the governor's proposals, the seven points that came out of that also did that. I believe from what I've scanned is that Chairman Harris's House Bill 14 touches on those as well. If Texas sees a need for dispatchable power or if Texas wants to capture the advanced nuclear industry for economic growth, Doug Robison (51:03.146)support from the state of Texas, whether that's in the form of loans or grants or whatever it may be, appropriations, then yes, that will help. As a Texan, I'll say I want stewardship accompanying that. I've never in my career, 40 years in the oil and gas industry, no one ever gave me money without demanding I performed. And that's why you have board meetings every quarter. And so the state of Texas should. Doug Robison (51:29.066)If it goes down that pathway should demand performance. If you're not performing, if you're not moving forward, meeting your goals, then you shouldn't have that those funds available to you. Same thing on workforce permitting officer. I know the, you know, the one project that has been moving down that pathway for a while is Dow X energy. Dow has been a great resource. Obviously the X energy has not yet filed their application with the nuclear regulatory commission. So we'll see what that process looks like, but Doug Robison (51:55.852)There was a considerable amount of licensing required just at the state and local level. And I think that was an eye opener to everybody. And so I think the state is leaning into that, which is a good thing. So I think the state can do a lot, but they can't do everything. And in that, I come back to just throwing money out in the middle of the room and saying, everybody grab it, is not the smart way to do it. I think it's going to require responsible industries, responsible companies, and Doug Robison (52:24.856)technologies at work that's going to have to work in partnership with the state and the feds because the federal component at particularly at the nuclear regulatory commission is going to be a big, big part of this. And I look at it as a partnership. You have to have all the above to get to where you want to be. Doug Lewin (52:42.902)loan guarantees from the loan program office does that sort of factor into what you're looking at going forward or do you not need those? Doug Robison (52:49.55)Yeah, I know Jigar's not in that position anymore, but he and I had dinner together in New York a few weeks ago. And the challenge that Natura has, for example, you know, we are for close to five years approaching a hundred million dollars into a project on a demonstration reactor. And then of course we have the commercial work in front of us. At what point do you qualify for those loans? And does it come so late in the project? Doug Robison (53:18.136)to where you kind of made it or not made it already. And I don't think the state of Texas needs to recreate the DOE loans program. I think there's over $300 billion at the federal level. So if those funds are available, then it's just a matter of when do you qualify for those. I prefer a loan. I like the idea of a loan as opposed to the grant, although matching grants can be effective. Sure. Doug Robison (53:44.818)if they're structured in the right way. But we don't know what that's going to look like in Texas yet. You you're right about the dollar amount that I think it's 200 million. But we don't know what the pool is. don't is that a, is that a billion dollar pool? Is it a five? We don't know yet. We'll see what the legislature does. And perhaps some other concepts such as loan program. Another idea that's been thrown around quite a bit is one of the big concerns that financial community has is cost overruns. Doug Robison (54:13.748)Is there a way to get insurance at the state level against cost overruns it? It gets complicated. How do you do that? But industry is working for lots of different ideas on how to move forward. We just need to do it responsibly. Doug Lewin (54:26.85)Just a couple more questions before we end. Rusty, can you talk a minute about Abilene? I mean, don't want to leave Abilene out of this story, because I think it's a cool thing about this story that this is happening in Abilene. You mentioned earlier Stargate. there's a big build out of data centers going on out there. There's like every kind of energy resource out there, wind, solar, oil, gas, and now nuclear. What's going on in Abilene? How has Abilene become this big energy center? It's pretty exciting. Rusty Towell (54:55.99)No, it is. It's exciting place to be. It's a great place to be. I'm thankful for the community. I'll say, you know, especially for this project, Abilene Christian University has really stepped in and saw what could be and stepped up, build this facility, partnering with Natura. And Natura stepped up in a big way, given the community, the university, our students, an opportunity to really develop something that's going to up blessing all of Texas and really bless the world. so. Doug Robison (54:59.694)for Rusty Towell (55:23.15)It's an exciting place to be. We're thankful that other people have thought it's a neat thing and Stargate coming here. Absolutely. If we can get some nice solid demand need for energy and develop a reliable supply, then that's a great match. Abilene's great place. visit and see our facilities. Doug Lewin (55:41.678)Yeah, I think that you might have potentially a very large customer there, right? Right close to home too. And I think that would be an interesting example of how a lot of the wind and solar out there, like if you look at data centers, there's going to be a lot of things where you can batch the functions and do them whenever, and then there's going to be a lot of 24 seven, like inference. just, you got to have it. So that's where you, could see some really interesting mixes. Doug, I want you to answer the same question. I also just want to ask you before we end, I you've alluded to this a few times, but I just want to ask it directly. Doug Lewin (56:10.048)You obviously were involved in the oil and gas business for a long, time as an oil and gas executive. You said you're retired, came out of retirement for that. Your career was in oil and gas. What are some of the transferability from oil and gas to nuclear, both for you personally and for the industry? It's not, I don't think obvious or intuitive necessarily where the connections are, but I think it probably is obviously intuitive to you. So can you explain that connection and of course, anything you want to say about Abilene? Happy to hear it. Doug Robison (56:38.254)I want to talk one second. I don't think we've touched upon this is why we started on this project in the first place. And this technology, we're talking about policy and the needs in the state of Texas. But when Dr. Tao laid out what this technology could do back in 2017, when I first heard about it, it was we could meet some of the basic needs of the world. You know, we could lift people out of poverty with affordable electricity and a little bit electricity changes someone's standard of living incredibly. Doug Robison (57:07.404)You want a third of the world, Rusty help me if I get the numbers wrong, a third of the world doesn't have affordable electricity because we have high process heat. We can desalinate water. A third of the world doesn't have fresh water. 200 million man hours a day are spent by women and girls carrying water because we're liquid fuel. We haven't talked about the medical aspect of it at all because we're a liquid fueled reactor. can capture medical isotopes. can treat image, cure cancer. And so part of it is we want to meet. Doug Robison (57:36.686)incredible needs of the world. You know, if we can cure prostate cancer, for example, how long do we want to wait till we do that? How about we do that as fast as we possibly can? Amen. I think 39,000 men a year die in this country from prostate cancer of the three of us sitting here. Odds are we're going to deal with that. And so there's a missional part of this that can be overlooked. So I wanted to make sure that was out there because we don't talk about that a lot unless somebody asks us directly. Doug Lewin (58:04.716)Well, look, energy abundance is sort of like foundational to everything else, right? Doug Robison (58:08.92)That's exactly it. It's the, Robert Bryce says, it's the mother of all grids. And so what translates from oil and gas, hellbent for production. We're all about production in the oil and gas industry. We measure production, our daily production, our annual production, you know, our rate of production. It's all about production, production, production. What are you producing? So that translated into what we're doing. I think some other things, if you're watching the show, Landman, Doug Robison (58:36.11)That's not the right image to have for the oil and gas industry. You have to operate, believe it or not, ethically. Your reputation is everything. And you have to do what you say you're going to do. The oil and gas industry is pretty brutal in that if you don't perform, you're not going to last. And there's a tremendous amount of promises. As someone said that in Austin, there's pretenders and there's performers. We have a lot of pretenders out there right now. Doug Robison (59:03.692)dozens and dozens and dozens of reactor projects, quote unquote, that say they're going to do and fill in the blank and a lot of pretending. And it creates like we had a few days ago, a lot of dust in the air and you can't see very well because of that. So we, we at Natura and at ACU and our research partners at the other universities perform, perform, perform. It's why I think that drive toward performance as opposed to promotion has Doug Robison (59:31.914)over time has distinguished us in the industry. I think it will continue to do so. That's our responsibility. That's our burden. We have to perform. If we do that, I think we're going to attract the capital. I think we're going to attract the industrial partners. I think we're going to attract the customers that are going to begin to see that and then believe that they can rely upon that. Doug Lewin (59:53.122)Yeah, I'm excited about it. think there's huge potential for this. I'm thrilled you guys are doing this in Texas and really looking forward to following this. it in reporting on it as it develops? Gentlemen, I appreciate both of you doing this. Is there anything that I did not ask you that you wish that I would have anything else you'd like to add before we close? Doug Robison (01:00:10.252)Rusty, thought, think you threw out an invitation. I don't know if we've talked about the, sir. I think you need to highlight that. Rusty Towell (01:00:16.244)I'll just say thank you Doug for bringing up the purpose and the mission behind this. That's what's excited. That's why so many of us are working on it. That's why we've had so many students that are passionate about this. Yes, and we get to work here on the ASU campus and the Science Engineering Research Center, which is the nation's very first advanced reactor prototyping center. And so this is a facility that's already built and we're living in it, which is where the Turro Resources Moldensol Reactor 1 will be built as a small-module reactor brought here, deployed on site. Rusty Towell (01:00:45.962)and commissioned, licensed by NRC, advanced reactor, licensed by NRC to come to a university ever, and we're excited it's going to happen. The building and facilities here, this is not something that's just a paper. As Doug says, we're performing, we're performing the licensing in on the design side, on the facility side. It's an exciting project to be part of because we're making steps forward and we're going to make the world a better place. Doug Robison (01:00:48.846)be the first. Doug Lewin (01:01:10.662)I might just invite myself out there at some point to come look around. So if you guys will have me at some point, I'd love to come out and see what's going on out there. Keep me on your list if you're having any events or anything super exciting. Doug Robison (01:01:21.688)could host you for a live podcast there. Doug Lewin (01:01:23.99)Well, let's do it. The next time I have you on the Energy Capital podcast, we'll do it live from Abilene. I will take you up on that. Thank you so much, gentlemen. I really appreciate it. Good luck with everything, and thanks for being on. Rusty Towell (01:01:35.182)Thank you. Doug Robison (01:01:35.682)Our pleasure. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.douglewin.com/subscribe

Every summer, we hear concerns about rolling blackouts. Every winter, we remember the failures of Winter Storm Uri. But how did we get here? What are the biggest risks, what has actually changed, and what still needs to happen?In this episode of the Energy Capital Podcast, I sat down with Mose Buchele, longtime energy and environment reporter at KUT and the host of The Disconnect, a podcast that has taken a deep dive into the history and politics behind the Texas grid.Mose’s reporting has helped shape how Texans understand energy, and in this conversation, we pull from his years of investigative work to connect past decisions to today’s challenges.One of the biggest takeaways from The Disconnect is that Texas’ grid problems didn’t start with Winter Storm Uri. In Season One, Mose and colleagues explored how a combination of regulatory neglect, an isolated grid, and a failure to coordinate gas and electricity markets set the stage for the catastrophe. In Season Two, a fundamental question was asked: Who really controls Texas energy? The deregulated system we have today didn’t happen by accident, it was built by political and economic decisions that benefited certain industries and players. In our conversation, Mose and I discuss who makes money when the grid fails and why Texas has been slow to adopt reforms that would prevent another crisis.But to really understand Texas energy, you have to go even further back. In Season Three, Mose has been unpacking the deep history of natural gas in Texas, starting with the wild stories of oil discoveries and the creation of the Railroad Commission—the agency that still oversees Texas’ oil and gas system today. The decisions that shaped oil and gas policy 100 years ago still influence energy outcomes today. Texas’ decision to keep gas separate from electricity regulation may have made sense in the 1970s, but today, it leaves the grid vulnerable during extreme weather.We also talked about ERCOT’s unique position as an independent grid, separate from the Eastern and Western Interconnections. This independence was originally designed to avoid federal oversight, but in today’s world of skyrocketing demand, extreme weather, and a shifting energy mix, is that strategy still serving Texas well? Should Texas interconnect with the national grid, or are there benefits to maintaining independence?The Texas Energy and Power Newsletter is a reader-supported publication. To receive new posts and support my work, consider becoming a paid subscriber.So where does that leave us today? Mose and I break down what needs to happen next to ensure reliability as Texas faces skyrocketing demand from AI data centers, industrial growth, extreme heat, and population increases. The grid is changing, but is it changing fast enough?Mose’s deep reporting and historical perspective make this a particularly insightful episode. If you want to truly understand how we got here and what happens next, this is an episode you won’t want to miss.As always, please like, share, and leave a five-star review wherever you listen to podcasts. Your support helps bring these critical energy conversations to more people.Timestamps* 00:00 – Introduction* 02:30 – The Disconnect Podcast: the origin and why Texas' energy history* 04:30 – Season 3 focus and “Who is Dad Joiner?” aka The Max Bialystock of Oil* 09:00 – The genesis of the Railroad Commission's and its role in oil regulation* 12:04 – How OPEC learned from the Railroad Commission * 17:00 – Why Texas was the last state to create a public utility commission, the Energy Crisis, and why gas utilities weren’t included in PUC regulation* 28:00 – Historical causes of Winter Storm Uri, and why it was so severe* 32:00 – The difference between “deregulation” to increase competition and lack of regulation of basic public safety* 39:00 – The Midnight Connection and how Texas’ grid was almost connected to the rest of the country* 43:30 – Understanding Black Start: what happens if the entire grid fails* 47:30 – Post-winter storm improvements and ongoing need for improvement* 50:31 – The Disconnect between gas and electric systems, the idea for a “gas desk” * 54:30 - Who profited from Uri? Why is there little to no regulation of intrastate gas monopolies?ResourcesMose Buchele and the The Disconnect Podcast: * Mose Buchele on X and the KUT Website* The Disconnect: Power, Politics and the Texas Blackout (Apple Podcast, Spotify)* Season One: Explores Winter Storm Uri, deregulation, and the grid’s vulnerabilities.* Season Two: Investigates who profits from Texas’ energy system and how market forces shape ERCOT.* Bonus Episode in 2022 with yours truly: The Megawatt You Don’t Use* Season Three: Traces the history of natural gas regulation in Texas and its impact on today’s grid challenges.Winter Storm Uri & Market Failures* The Great Texas Blackout Was Caused by a Failure to Ensure Supplies of Natural Gas, Charles Blanchard, Texas Monthly* Why Gas Failed During Uri – An in-depth Texas Monthly feature explaining how gas supply failures triggered power outages.* A look at the Texas grid three years after Winter Storm Uri: Three Years Gone, Texas Energy & Power Newsletter* The Texas Grid Came Close to an Even Bigger Disaster During February Freeze, Rebecca Smith, WSJNatural Gas, The Railroad Commission, and OPEC* “Is This Texas Oil Icon a Price-Fixing Saudi Collaborator or a Political Scapegoat?” Scott Sheffield role in Price Fixing in Texas* Texas Railroad Commission (RRC) – The regulatory agency responsible for oil and gas, originally created to oversee railroads but later shaped energy markets.* The Extraction State: A History of Natural Gas in America by Charles Blanchard * For more, listen to Season 3 of The Disconnect!ERCOT’s Market Structure & Texas Grid Independence* The Midnight Connection Episode – The Disconnect podcast episode detailing Texas’ attempt to interconnect with the national grid and why it failed.* Disconnect Bonus Episode: The Black Start* The Energy Capital Podcast, Episode 1 with Former PUC Commissioner Will McAdamsMore on Texas History* Profile of Oscar Wyatt and Lovaca Gas during the energy crisis in Texas Monthly in May 1975 by Paul Burka: Power Politics: How one company’s wheeling and dealing brought the energy crisis into your life TranscriptMose Buchele (00:00.0)This system of control that began here in Austin and in Texas was adopted by other countries and eventually taken over by OPEC, which still uses the blueprint for it today in the way that those member nations will decide on allowables and supply in order to fix the global energy prices. Doug Lewin (00:22.402)Why does Texas have its own power grid? How did a Texas wildcatter, who wasn't even trying to find oil, spark a global energy revolution? How did a Texas agency originally set up to regulate railroads create the blueprint for OPEC's oil supply strategy that caused the 1970s energy crisis? If you want to understand why the Texas energy system works the way it does, you have to go deep into the history. Over the last four years, KUT senior reporter Moe's, Bouchelle and colleagues at KUT have created an awesome series that does exactly that. It's called The Disconnect, Power, Politics and the Texas Blackout. It unpacks the forces that have shaped and continue to shape Texas grid, gas markets and energy policy. Moe's created an award winning series telling the hidden stories behind Texas energy from the railroad commissions cartel like power over oil markets in the 1930s to the Midnight Connection, the secret power line that could have changed Texas grid history by connecting us to the rest of the country. The first season was a deep dive into winter storm Uri and the history of deregulation in the state, something we talked about in this podcast. The second season tracked the changes that had been made and those that hadn't. They had me on for a bonus episode called the Megawatt You Save focused on energy efficiency. This current season, which just launched in February 2025, focuses on one of the least regulated industries in America, natural gas within the state borders of Texas. And what that means for grid reliability in the Lone Star State. It's fantastic. I've loved all the seasons of The Disconnect, but honestly, this one might be the best. I love this conversation with Moe's. It's about energy, yes, but it's also about power, politics, money, and the decisions made decades ago that still shape our lives today. Stick around because by the end of this episode, you will look at Texas energy or Texas history the same way again. Make sure you like, share, and subscribe to the Energy Capital Podcast and to The Disconnect. It's one of my favorite podcasts on all topics, not just energy, and I'm confident you'll like it too. Thanks for listening. Hope you enjoyed this episode of the Energy Capital Podcast. Mose Buchele welcome to the Energy Capital Podcast. Hey man, this is great. Thanks for doing this. Obviously I'm a big fan of the disconnect. Let's just start, just share with the audience, what is the disconnect and how it got started. Mose Buchele (02:31.63)Thanks so much, Doug. All right, so this is a podcast project that started actually really kind of during the big blackout in 2021. We're talking here at KUT studios. We were all here trying to figure out what was going on. Bunch of reporters trying to understand the power grid, all the issues at play. And even as it was happening, it kind of became clear that this is something that was going to take more than just some kind of breaking news updates, right? You had to explain all these complicated things about the way electric infrastructure works, about the way Mose Buchele (03:11.086)the energy markets work about a million different things and there's this deep history to it. And so we think, well, that sounds like the kind of thing that could be tackled in a podcast. We do audio storytelling really well and we do explanatory journalism really well, which is I think a big part of this is just explaining to people how these things work. And that was kind of the impetus. yeah, we're now on our third season. It started in 2021 and we've been releasing them as we've kind of seen the need and had the capacity. Doug Lewin (03:42.498)Yeah, it's one of the things I love about podcasts and it's, think why they're like so well suited actually to our time is because we're so used to now like getting news in tiny little snippets, right? 140 or 280 characters and little 60 second videos. But usually you wanna, especially with a story like this, like you wanna know more and you guys have really, really done it well. This mix of human storytelling, like really understanding the human side of things. Doug Lewin (04:10.062)And explaining the regulatory and the history, is so complicated and so rich. You guys are doing a great job. Mose Buchele (04:16.942)Thanks, I appreciate that. it is, it's a real undertaking, but even like the, you know, it's a political story, it's a science story, it's a financial story. And obviously the reason we all care about it early is because it's a human story. And so yeah, all of that comes into play and it's been hard to tackle, but it's been also really, you know, incredibly interesting and rewarding. Yeah. Doug Lewin (04:39.094)Awesome. So we're gonna talk about all the seasons, but I wanna start with season three. When we release this episode, you'll sort of be like, sort of part of the way through of releasing the episodes in season three. And you're really now diving into natural gas, which talk about a complicated history with all sorts of characters. I think if it's all right, I actually want you to start with. Doug Lewin (05:03.64)Just to give folks a flavor of what they'll get if they do listen to these episodes. And again, I highly encourage folks to listen to them. They're so great. Who is dad joining? Mose Buchele (05:13.28)Okay, this is where, as a disclaimer, we start this with a lot of history. And it's history I love, and it is, I think, just endlessly engaging and fascinating. if you're tuning into here in the first episode, like what is happening right now in terms of new developments, you're going to have to wait for a while. Doug Lewin (05:34.862)We'll get into this as we go, but if, you know, for folks that are wondering about this also, you can go, if you want to start with season one, you kind of go back to how Winter Storm Urie happened. we're going to get there. I want to work backwards because this one is current and it is something that Mo's even as, and I think it's safe for me to call myself an energy nerd. I know a lot of this history. There are so many rich details in your podcast that I didn't know. Doug Lewin (06:03.534)But you don't, and this is what I hope comes through to the audience and people will tell friends and family, it's like, it doesn't feel like you're getting a history lesson. It's entertaining, it's engaging. Oh my gosh. Tell us about that, Mose Buchele (06:14.734)So Dad Joyner was the father of the East Texas oil field, which was up at that point, the biggest oil field ever discovered in the United States. And he was by most accounts, kind of a con man. guy, there were a lot of these kinds of operators that were moving around the oil patch at this time, who were finding ways to raise money for projects and then spend that money and not always find oil in the process. Doug Lewin (06:45.614)You know who he reminded me of? I had recently been visiting my my dad. And one of the things I do when I visit my dad is we watch silly movies and we were watching the producers. I knew that's right. Max Bialystok, like dad joiner is an oil patch version of Max Bialystok. Mose Buchele (07:01.014)The entire idea is that you raise money on a project and you get to keep that money as long as it fails. So there you go. That's the, that is the producers in a nutshell, right? And, and so his, you know, his whole thing was that he would, in partnership with a guy named Doc Lloyd, who has one of my, one of the people I spoke to said, practice medicine without, without the formality of a medical license, they would create geological surveys that would suggest that there might be oil to be found in one place or another. And on the basis of these surveys, which really didn't appear to have much, you know, actual geology, but underneath them, they would raise money to be paid back once the oil was discovered. Now, if the oil is never discovered, then you get to keep the money. And this is the way it worked for them for years and years. And it's a, it's a fascinating story because of the personalities involved and the people involved, also because it suggests that this oil field, which revolutionized the world of energy, and had ramifications that we still feel to this day, it was found because someone was intentionally not looking for oil. And so it took somebody not looking to actually uncover this vast reservoir of energy in East Texas. And then from there, you could argue the story even gets weirder. Doug Lewin (08:19.822)Yeah so folks can go and should go and listen to the, to the episode and get more of this. like basically you, you end up in a situation where a woman who is like, I guess an investor or her land, she's got land there. She starts to become suspicious. She thinks, no, there really is oil. They do end up discovering oil. is very bad for dad joiner. And it ends up being, like you said, historically significant, globally significant oil field. And it happens in 1930. So we're heading into a decade, obviously, where the second world war is gonna start. And like this oil field really plays a major role going forward. But you get into the railroad commission and how this is, think, a history folks don't understand and is highly, highly relevant to today because what you had was everybody drilling all over the place to the point where prices dropped to what, like a, it was like 10 cents a barrel or something like that at some point. And so you start to get into what is called prorationing, right? So the railroad commission, can you talk a little bit about how that actually made the railroad commission popular. You would think by telling people don't drill, you're gonna get a lot of companies mad at you, but it actually had kind of the opposite effect, right? Mose Buchele (09:47.81)Absolutely. And again, this is history that is helpful in understanding the role of the commission today. For example, what we had was an agency called the Railroad Commission that was founded to regulate railroads, as the name would suggest. Doug Lewin (10:03.662)Governor Hogg is that what she right? Yeah, yeah. Mose Buchele (10:06.092)Yeah. And it was a huge deal back then. There was a big populist movement, particularly farmers and ranchers were really, really upset with the monopoly power that railroads exercised over their commodities. And so they were going to their elected leaders and saying, you got to crack down on these guys. Railroad commission is born. But through a series of kind of historical circumstances, the Railroad Commission ended up gaining more authority over pipelines than railroads, over oil and gas pipelines. And so suddenly you had this agency called the Railroad Commission, which is still called today, beginning to exercise authority over oil and gas. If you fast forward to the 1930s, to the Depression era, when the East Texas field was uncovered, you have then this agency with this hot potato thrown in its lap. People are drilling for oil like crazy and it's cratering the price of oil. There's just an oversupply of oil on the market. This is very bad for, especially for the large integrated kind of big oil companies. A lot of them from the Northeast that think standard oil, right? That depend on a stable market and a kind of more consistent expectation of return because they're making huge upfront investments on what they're doing. And so then these, this part, this faction, Mose Buchele (11:33.006)of the oil industry goes to Austin and says, well, we've got to do something about this. This is how the, what you pro rationing or pro rationing people, I've heard it called different things is, is born. It is the concept that the government will, will regulate the supply set allowables for how much oil or gas can be produced in order to stabilize the market. And that will, that will allow for a, kind of oil or whatever commodities not get too too low, maybe not get too high too if that's gonna have bad effects on the market. Doug Lewin (12:10.862)It's effectively a cartel, right? It's exactly what it is. Because basically just like you would think of a drug cartel, not to say that the railroad commission was a drug cartel, but it's the same principle, right? If you control the supply, then you can actually keep those prices higher and presumably then all the suppliers are doing better. And so they actually do that successfully, right? Mose Buchele (12:33.999)It wasn't an easy sell, especially when you're dealing with more independent and especially during the depression era, you're dealing with Doug Lewin (12:39.566)Because demand is so low. So you can only do so much with supply. There's not demand because of the depression. Mose Buchele (12:43.842)You had independent and again, still to this day, these are schisms that you see within the industry. have independent operators, you have a small time landowners, have people who were farmers who are losing their mortgage because of the depression. Suddenly they can dig an oil well in their backyard and they're happy making a few cents. They'll take anything. They, in some cases, violently resisted this kind of regulation. But what was eventually arrived at? Mose Buchele (13:12.718)it appears is that most sectors of the industry came to realize there was a benefit to that type of essentially what was price fixing, you know, on the part of the state government, on the part of the commission. And this was done in cooperation with different factions of industry. And that is how this, what you correctly described as a cartel system of regulating supply was born. And it was born right here in Texas. Doug Lewin (13:40.214)Yep. And then OPEC learns from the railroad commission, like literally studies what the railroad commission has done and then uses that to sort of, you know, wield oil as a weapon in the 1970s, which causes the energy. Mose Buchele (13:56.172)We're getting again, and now we're getting into the second episode. And again, like I said, this lays the foundation for a lot of interesting kind of historical things that come up later. indeed, this system of control that began here in Austin and in Texas was adopted by other countries and eventually taken over by OPEC, which still uses the blueprint for it today in the way that those member nations Mose Buchele (14:22.444)Will decide on allowables and supply in order to fix the global energy prices. Doug Lewin (14:27.15)We're recording March 5th. Just this week, OPEC announced that they were going to release more barrels into the market. They have tried over the last few years through OPEC plus, which includes Russia and some others that weren't traditionally part of OPEC to pull back the supply to cause the price to go higher. Prices have sort of stubbornly been right around 70 and they have kind of decided, forget it, we're going to release a couple more million barrels. So all of this is to say, right, this history, there's a through line right to today. And if you want to understand what's going on in the energy world and you don't want to read great long textbooks, a podcast is a great way to learn about it. So, and actually just one other tidbit on this, Moe's, and I don't know if you are going to cover this later, but there's also a very recent example, right, of some of the companies coming to the railroad commission during COVID. You could quote unquote buy a barrel of oil for a negative price for a couple of weeks there, maybe not a couple of weeks, maybe one week, whatever it was during COVID. And some of the companies came to the railroad commission and said, we should do pro rationing again. This is only a couple of years ago. So like now they voted against that. The railroad commission did not do it. But again, like all of these issues still kind of circle around today. I think it shocked a lot of people to even learn that the commission still had that power. that they ever did. mean, if you're not paying attention, if it's not something that you study, like there was a really memorable public hearing, and you had, you people coming in and telling commissioners, need to do this. We need to this to, you know, to save the business basically. And then others opposing and rarely are those schisms and those tensions within industry on public display but in moments of crisis they get there. Doug Lewin (16:19.116)That's exactly right. And I will put in the show notes a link to Russell Gold with Texas Monthly wrote an article about Scott Sheffield that he was under investigation. I can't remember if there was actually an indictment or just an investigation from DOJ on that. Like sort of what was happening during that period and whether or not he was actually talking to allegedly leaders in other countries and other oil companies around the world trying to get the price of oil up and whether or not that was some kind of collusion or Mose Buchele (16:49.518)Price fixing or something like that. Doug Lewin (16:51.174)Yeah, yeah, totally. That is still like literally playing out in real time right now. So in the third episode, which just came out again, as we're recording just a few days ago, you do get into, and this, I really, I'm sorry to be like so gushing to my audience, but I just really do love this series. I have for a long time, like wondered, we, Texas was one of the very last states to have It was the last. The last to have a public utility commission. Wasn't, wasn't established till 1975. Doug Lewin (17:18.766)And I've often kind of wondered about that. And I actually taught a class at the LBJ school last semester. So I was doing some research. I found some journal articles that kind of got into it, but journal articles are pretty dry. You found the man who was still alive and not even particularly old. He was very, very young when he was elected in the 1970s. Tell us about Lyndon Olson and the beginnings of the Public Utility Commission. Mose Buchele (17:45.166)mean, an incredible storyteller too. It was just one of these things where I call this guy up and he's like, yeah, sure, I'll talk about it. So Lyndon is, I mean, he's had a very long career, but as you said, he's from Waco and he was elected a democratic state rep from Waco in the early seventies, right as the energy crisis kind of hits, especially as we understand it in popular consciousness. There were obviously kind of shortages and building up to the energy crisis before then, but- Doug Lewin (18:14.656)And I think most people listening will probably know this. And again, you describe it well in the podcast, but for those that don't know, right? mean, this was, it's not hyperbole to call it a crisis. Like you couldn't fill up your car. had long lines, half a mile long in some cases. People were freezing in their homes in the wintertime because there wasn't enough gas. It was a mess. Mose Buchele (18:32.014)Absolutely. yeah, and again, I think that some of that's lost. you know, if you're younger, you weren't alive for that time, you don't realize it, but it was such a huge thing. anyway, yeah, young man, not even in his thirties, elected from Waco to be a state rep. And he kind of enters into this debate over, how are we going to better regulate utilities? And this wasn't just energy utilities. wasn't just electric utilities. It wasn't just gas utilities. There was, but everyone is worried about the high cost of everything at that time. Obviously in the energy crisis, the cost of electricity and the cost of gas went way, way, way up. And that was really pinching people. There was also a massive scandal that I wasn't that aware of around telephone utilities, telecoms. Southwestern Bell was in a lot of trouble for its rates and some of its corporate behavior. All of this rolls together to collide with the fact that Texas is looking around and saying, every other state has a public utility commission and we don't have one. Basically, almost all these things were really mostly decided at the local level. And so in 1975, there is a growing kind of appetite in a chorus, consumer advocates, all sorts of different kind of factions that maybe it's time to have a public utility commission. This man, Lyndon Olson, comes in and as he describes it to me, he's actually kind of more in favor of maintaining local control over a lot of these questions. He was interested in strengthening the power of local oversight as he recounts it to me in the bill that he first introduced. One of the big questions about that was that small towns especially, but really almost any city didn't feel equipped to go up against some of these massive monopoly utilities when they're gonna do rate negotiations, right? And so. Doug Lewin (20:19.352)So they really didn't have watchdogs, right? It was like cities trying, it was a complete mismatch. Mose Buchele (20:25.326)So Olson gets in there and drops a bill that, as he said, would initially strengthen local control over some of these issues. As he recounted it to me, it was immediately substituted by the Public Utility Commission Bill, the Public Utilities Regulation Act that establishes the Public Utility Commission. And then from there, the story gets even stranger when you start to look at how they decided which utilities were going to then fall under the auspices of what became the Public Utility Commission. Because when the bill was first written, gas utilities were a part of that. And he tells the story of how it was explained to him in no uncertain terms that all of that regulation and oversight was to remain at the Railroad Commission. From the very inception of the PUC then, you see this tension. How are we going to have some say over what should be fair electric rates while we have no real regulatory control over the sector of energy that provides the fuel to create that electricity. And here I'm speaking mostly to natural gas. you know, so there's a quote that I don't, I don't even know if I included it in the podcast, but maybe I'll try to slip it in somewhere. After the public utility commission is established, regulation of natural gas is kept at the railroad commission, which has given utility cost of service kind of regulation authority over gas utilities. There is a guy who was a city attorney for the city of Austin and became a consultant later on for the city. And he was asked, is this going to help us with our electric rates? Because gas rates and electric rates in Austin had been going crazy because of another whole other scandal that we got into in the podcast in regards to a company called Coastal States or Lovaca Gathering that had different names. Doug Lewin (22:15.31)A notorious case. Mose Buchele (22:18.668)So this guy, Don Butler was his name. He's asked quite understandably, is the Public Utility Commission gonna help us lower our electric costs now that it exists? And he said, it's really not because it never got authority over natural gas. And he said, what the legislature did is that he allowed us to regulate the tail, but not the dog. Wow. Yeah, yeah, I don't have it on tape, but it's still, it's a killer quote. Doug Lewin (22:40.263)Wow. Which really kind of sums it You've got to get that correct. You need to go back and get him to record that and put it in there. Look, I think hopefully it isn't lost on anybody listening right now, right? The connection back to seasons one and two where you're dealing with Winter Storm Uri because part of the story of Winter Storm Uri is a lack of coordination between gas and electric. If people want to, you know, ask... Doug Lewin (23:08.878)Why did that happen? Why did 240 something people die? Why did a hundred billion dollars in damage happen because of freezing pipes? And why was I without power for three or four days? There's a long list of reasons, but on anybody's short list is there was terrible coordination, if any coordination at all, between the gas sector and the electric sector and the seeds of that were planted in 1975 when the PUC was established and not given any authority over gas. Mose Buchele (23:37.902)I remember actually way back in 2021, it was probably one of our earlier interviews on this subject. I called you for a story I was working on and you were one of the first people I spoke to about this. And this became, like you said, a huge and continues to be a huge question in Texas. Like how do we coordinate those two parts of energy, gas and electric? And it's something that a lot of the efforts, I guess I could just say that have been proposed, a lot of the proposals have not succeeded so far. So it's still an open debate, you know, in terms of how you do. Doug Lewin (24:11.086)So let's, is there anything more you want to say about season three? You want to give folks like kind of where it's going, what to look for, anything I should ask you about season three before I kind of go back to Uri and we talk about season one and two. Mose Buchele (24:21.09)You know, I just think, like I said, season three has been a really cool, a little bit of a different take on the podcast because we focus on history throughout every season. But this one, I really like telling this integrated story that is now, you know, if you start tuning in, know, it's difficult to do timing on podcasts, but we'll slowly bring you up to today. And it's been a fascinating challenge, like seeing how that works but everything does kind of connect. mean it all just comes together. You know if history doesn't repeat it at least it rhymes. Doug Lewin (24:55.854)Exactly correct. And I'll just say one more thing about that. I meant to say this earlier and forgot. there's, cause again, the connections between the past and the present are, they're obvious, but I think sometimes it's good to say them out loud. So we are right now, again, so we're recording on March 5th. By the time this comes out, who knows what will happen with tariffs. But one thing that folks associated advisors to the Trump administration, people within the administration are saying is, we're gonna, that may cause prices to go up, but we're gonna counteract that because this drill baby drill thing, we're gonna bring oil down to like 50 bucks. And so then your prices are gonna go down. So it'll all be okay. And I think what, you can go back to history and see what happens when you drill baby drill and prices crater. And a lot of people lose their shirts and then people stop drilling, right? Like the that isn't the way it works. You have market forces. You can't just as a government say, we're going to go drill because once you do that, now you're causing this other counter force where you're going to get less drilling. Yep. And we've already got this countervailing force of OPEC putting more barrels on. So, yep. Anyway, it really is great to like get into that history and see those parallels because there's just so many of them to, to today. Yeah. I really appreciate what you're doing with that. I, again, it is hard even as somebody who just loves this stuff and I'm pretty voracious reader on this stuff. I'll put a link. There's some good like books on the history of natural gas and stuff, like those, they're hard reads. Like, you know, like to get that in a 30 or 40 minute podcast and feel like, okay, I have a deeper understanding of this, this history. It's a real like public service. It's really. Mose Buchele (26:40.224)Well, thank you. Yeah. And I think I've read more for this, this particular season than I have for any others. I've checked out some great books, but also some of them, yeah, cause it can get pretty wonky. Doug Lewin (26:50.574)Shout out to Charles Blanchard. I will put a link to his books on natural gas that are actually like, I think is, I forget the title, I'll put it in there, but it's like. Yeah, yeah, yeah. It's a great read. He wrote a great piece for Texas Monthly two or three weeks after Uri that was something along the lines of like. Mose Buchele (26:59.886)Extraction state or extraction. You recommended that to me actually. Doug Lewin (27:14.572)Uri was a problem of natural gas supply. And his book, Extraction State, is a great one and very readable. But, you know, let's be honest, that, that many people, sorry, Charles, are gonna read your, like, 300 400 page book on the history of natural gas in America. I did. I loved it. And even though I read that book and have read many others, there are details you have in there that I have never heard before. So, okay, enough on that. So let's go back to season one. You, you're putting episodes out only months after Winter Storm Uri ended. I actually just kind of want to start with, we've already talked about one of the reasons why Uri happened was this connection between gas and electric or lack of communication, lack of coordination between gas and electric. If you're kind of a doctor diagnosing the problems, right? You're deep into this. You've talked to so many people about this, put together episodes on it. Why did Winter Storm Uri happen? come on, Yeah, yeah. So one is electric gas, but there's a list, right? Mose Buchele (28:11.046)Yeah, yeah. It's real easy question. my goodness. Well, so, you know, yeah, obviously the question of why, not just why did the blackout happen, but why it was so severe and so bad. You can answer it a million different ways. And in fact, there's, you know, there are still a lot of differences of opinion about it, right? I mean, and we can get into what some people are still litigating today later on in our conversation, but Doug Lewin (28:12.608)It's an easy question. Mose Buchele (28:40.546)What we do in the first season is that in the aftermath of the blackout, everybody was talking about deregulation. Texas existed as did the rest of the country under a system of with regulated regional monopoly utilities ever since basically the beginning of or the maturation of electricity as a thing that everybody. Doug Lewin (28:59.244)But as you were talking about before, right, and because we didn't have public utility commission, very lightly regulated monopoly. if regulated at all, kind of self-regulated, which means not really regulated at all. Mose Buchele (29:11.586)Yeah. So then there's this period where you have utilities that are regulated by, you know, with stricter price controls by the government. And there's a very close relationship between regulators and these monopoly utilities. They're allowed the, I don't, again, I feel like I'm kind of rehashing just utility 101 or something, but we had a large fleet of different kinds of power plants in Texas, many of them natural gas, because we had an abundance of gas here. Although also that became a whole thing after the energy crisis, some coal and other ways to generate electricity too. Deregulation hits, that breaks down the monopolies and these power generators are now forced to compete, to offer the lowest price. And critics of deregulation, of which you heard many, especially after this catastrophic power failure, pointed out that the capacity, the excess capacity that Texas had enjoyed through the 1990s under regulation had all but been kind of frittered away by the time we got to 2021. And so then when energy demand went through the roof and power plants, which at that time had been under invested in and were many of them reaching their kind of end of their natural lifespan, started breaking down, you had a crash in energy supply on one hand, right as you had a skyrocketing of energy demand on the other, all thanks to this extreme and cold weather. Mose Buchele (30:39.372)And what that leads to is an imbalance on the grid and forces the state grid operator to rebalance supply and demand by cutting the demand. They can't encourage more supply because there's no real extra supply out there. They had used every mechanism they possibly could to bring some including spiking the price to try to potentially get more on there. So that's one way of looking at this. that was one of the questions we tried to explore in the first season. And I think that we found it was a little more complicated than that, but I think that that is maybe a good place to start with your question. Doug Lewin (31:19.424)Yeah, yeah, yeah. So this is something I've obviously talked to a lot of people about. The very first episode of the Energy Capital podcast I did was with Will McAdams. Will was of course the first commissioner appointed after winter storm Uri. And one of the things, cause he's pretty strong defender of what I think he wouldn't, and frankly I would also call not the deregulated market, cause there's still a lot of regulation, right? There's an independent market monitor. There's all sorts of controls and penalties that many of which have been assessed over the last 20, 25 years for folks that withhold power from the market. Like there is regulation of that market, but it's a restructured market that then is competitive, right? We do have competition on both generation and retail. And he's a pretty big defender of that. And one of the things he said in that podcast, which has been said a lot since, since Winter Storm Uri said during the hearings after Uri heading into February of 2021, the various reports our cop puts out of how much capacity versus demand, we had a 40 % cushion. So like, even if you had had like a fully regulated system, you almost certainly would not have ordered your fully regulated utility to purchase more power because you have 40 % reserve margin. What do you need, a 50, 60 % reserve margin? Like 40 is a lot of slack in the system. And in fact, A year and a half later, right, December, 2022, almost two years later, winter storm Elliott, we did see blackouts in areas of the country that have fully regulated utilities. Tennessee Valley authority has a huge reserve margin. They had blackouts. They, by the way, also only have two to 3%, less than 3 % of their mix is renewables, 97 % thermal, huge capacity reserve margins, and they still had rolling outages. So the conclusion that McAdams reaches and we talked about a lot during that particular podcast. And I think I reached the same kind of conclusion is it wasn't actually like the restructured market, but a lack of regulation was a big part of it. Because we weren't winterizing power plants. We weren't winterizing the gas fields. We weren't requiring homes and buildings to reach a standard where that demand would not spike. So there's still a problem of quote unquote deregulation. But it's not necessarily the way the wholesale market is set up. you, how does, how does that? Mose Buchele (33:42.248)Yeah, no, I think there's a lot to that. think that the, first of all, to the question of like calling something, saying deregulation, it is just misleading to say that it's, you know, what you're really talking about is an arrangement between regulator, a very specific arrangement between regulators and monopolies. And again, this doesn't just happen in electricity. I mean, when deregulation became a thing in the late seventies, it went to numerous different industries. Doug Lewin (34:06.888)Airlines is one of the, right? Because like you literally could only fly from one city to another if you had the government, you know, license to do so. And if you want, if you saw somebody who was flying the New York to Chicago route and you're like, I could serve that for half as much, you could not. And it was Jimmy Carter and Alfred Kahn. Like it was really actually like liberals that really got, in concert with conservatives, there was actually sort of like, ideological agreement across the spectrum that like charging 500 bucks for a route that somebody else could serve for 200 isn't a good thing. Mose Buchele (34:42.252)One of the main continued critiques, even given what you've just articulated, is that people are nervous about a system which rewards scarcity. And when you create a deregulated, quote unquote, sorry, whatever you wanna call it, restructured market, you have a system where the price of what you're selling becomes more valuable as its scarcity. Rises which is scarcely rising you understand what I'm saying? I understand volatility when prices go up and and so to give one example. Talk to people who used to work for big utilities. In the 80s and 90s, it was very common for more power plants to have massive tanks for backup fuel, for fuel oil, right? That they could switch to to burn if their natural gas supply shut down. And in fact, they would sometimes coordinate with their gas supplies. I was talking to a guy just a few weeks ago who said that they would get calls and say, the pressure is going to drop in these pipes as a big storm or something. Something's happened. Switch to the fuel oil. And then they can keep generating power. The market incentive to have that type of backup did begin to evaporate after the restructuring. And I think that is a kind of thing, like a very specific example you can point to and say, that maybe was a problem because that could have come in handy, again, maybe in 2021. But your point is well taken. There are a hundred different things that came in to create this crisis. And we are seeing not crises of the same magnitude, but similar challenges with energy systems and grids and ISOs and whatever all around the country. And so it is not just one thing. I mean, we could talk about Texas's relative isolation in terms of its own grid is another thing people point to all the time. We've already kind of mentioned the whole question of natural gas and how it feeds into the system. I mean, if you want to talk about regulation versus deregulation, know, ERCOT looks like a very tightly run ship when you start looking at what rules may or may not exist when it comes to how natural gas is traded and moved around the state. That's one reason why we were interested in doing this new season. So, yeah, is just a question of degree in a lot of ways. Doug Lewin (37:04.398)No, I think that's right. And I actually think you hit the nail right on the head that I think what does get people very nervous about a competitive market is the question of scarcity and volatility and high prices. And it is hard for folks to kind of get used to that. And you see this happen all the time. There are days during the year we've seen them, we didn't see as much in 2024, though quite a few in 2023 where prices got really high. I was often on Twitter saying that is not necessarily a bad thing. If we get into an energy emergency, that's bad. But like high prices actually are a signal to investors that you want to come into the market. But that's a hard thing. I don't discount that. That is hard. It's a little scary, right? But people have to like, know, markets do require some uncertainty, some dynamism and some high prices. That's how markets work. Mose Buchele (38:00.352)And there's also just, mean, not to kind of take a different turn with this, but within the context of Texas, know, people love and hate the, and I'll use your term restructuring for various reasons, but one thing that it did do, and we get into this in the first season, it was the way that we kind of opened up to allow for so many more renewables and so many more other kinds of ways of generating electricity in this state. And so it's not just you find people defending or criticizing that historical decision for all sorts of reasons, but there are a lot of people who just in terms of the energy mix really celebrate what happened under deregulation for just that reason. Doug Lewin (38:41.824)Yeah, yeah, yeah. And it was one of the reasons why it passed with such wide margins, throughout the House and Senate in a very bipartisan way, partly because there was an energy efficiency resource standard, there was a renewable portfolio standard in there. You have great episodes throughout these first couple seasons on, you mentioned Urquhart's isolation, you had one on the Midnight Connection, I wanna ask you about that. You had a great episode on Black Start, which I feel like still is not understood by folks enough. You obviously had episodes rather that got deep into deregulation, Senate Bill 7. You talked a lot with Senator Sibley. Given it's an hour long podcast, I'm not gonna ask you about each and every one of those, but is there one in particular sort of like asking you which of your kids you love the most? Is there an episode though you wanna kind of highlight for the audience? It's like, I gotta imagine the Midnight Connection one is one. Again, that was like a history that as much of a nerd as I am, I did not really appreciate how that all came about. Mose Buchele (39:39.522)I love that episode and I love the experience of making that episode. was one that we've. Doug Lewin (39:43.352)You guys went to the other border to the Red River. Mose Buchele (39:47.15)I think that one of the things that people still like are most fascinated by and maybe concerned about when it comes to the Texas grid is our relative lack of connection with other grids in neighboring states. we had, I'd heard even before probably, as an energy reporter, I just always kind of been aware that there was an attempt in the seventies to connect, to create a stronger interconnection between a utility in Texas with a utility in neighboring state. And that this was in fact done almost as a test case to kind of push the issue because there were people on both sides of that argument in Texas at the time. were utilities that wanted to interconnect and those that didn't. And not to get too deeply into it, but the reason was federal regulation. If you start moving massive amounts of electricity through these big transmission lines and synchronize with a neighboring grid, then that invites regulation from the feds. And a lot of people in Texas didn't want that. Again, other utilities may have seen a benefit to that. And certainly others argue that there's just simply a benefit for reliability to that. But all that is kind of maybe getting ahead of myself. What we do. Doug Lewin (40:58.944)You found the guy who made the Midnight Connection. It's amazing. Mose Buchele (41:04.014)Yeah, and I'll credit to Audrey to my colleague who's a co-host in this most recent season. She looked through some old hearing documents and I don't know if they were hearings at the PUC or court documents and found this man who had worked for this utility. They made a connection to a place called, I think it's called Vernon, Texas, I'm not mistaken. yeah. Birthplace. We decided to drive up there and Ullman King was his name and we had not. Doug Lewin (41:07.873)A COAST! You did yeah Mose Buchele (41:33.41)I don't think that we had gotten a response from him. Maybe we had emailed him. We decided to drive to Vernon just to see where this happened. Maybe try to talk to some people there. We're thinking maybe there are some like old timers, right? Who just remember. And we showed up in the town and everyone's like, nah, man, we, know, this is, this happened. This is something that kind of happened in secret, you know, 50 years ago. people are like, there's no monument. There's a monument to Roy Orbison. There's not a monument to the Midnight Connection. But on the way there, we found an address. And Audrey went knocked on this guy's door and he was there and just happy, know, happy to have us in. We went and visited him the next day and he recounted the entire story, this entire... He wasn't there when they did it, but he was the guy who was going to present legal papers, the second the connections made to essentially kind of prompt what was going to be a big legal battle, a big regulatory battle. Doug Lewin (42:13.11)of actually stringing a wire. Mose Buchele (42:32.256)And in fact, it dovetails nicely with, we were talking about Lynn Olson earlier, the public utility commission in Texas was just a a baby state agency then, right? So this happens right around the time when the public utility commission comes out. Yeah, yeah. And this case falls in their lap. And the PUC was very hostile to the idea of interconnection. And indeed, eventually, Doug Lewin (42:48.193)that a year. Mose Buchele (42:59.142)you know, not to give the whole story away, but they, you know, they reach something of a negotiation, but really set the precedent for what we have today, which is a grid that is not tightly linked with any neighboring grids, unlike any other state in, you know, in the lower 48 states at least. Doug Lewin (43:15.404)Definitely everybody listened to that episode. It's amazing and and really again like you're right Audrey played a huge role in that one and like the as she hasn't so many of them but the the way you guys kind of tell the story and you're even like on the road going up there like the the way the process is kind of start it was part of it is a lot of fun briefly tell us a little about the black start one because I think that again like folks don't really understand how, we were actually quite close during winter storm. You're like, this is still the language even sort of like gets to how little folks understand this. Cause we all use the term like, you know, blackout. was actually technically rolling out. It it felt like it was a complete blackout. Cause people were without power for days. But actually that term means you've lost the whole grid. And it could be down for weeks or months. And then you have to try to bring it back. again, like you can read up on this stuff. You can find technical reports, but to listen to a 20 or 30 minute podcast, give us the short version of that. Then folks can listen to the longer version. Mose Buchele (44:16.622)Yeah, yeah. And I mean, this is like what they also refer to as a of a catastrophic grid failure. This is where, as bad as what we had in 2021 was, there is the possibility that a power grid completely crashes to the point where it almost breaks into its different constituent parts. Like when you think about electricity grid, it requires a constant balance of supply and demand on the transmission systems. And all the different things that go into that grid, from power generators to substations, even to the things in your house that run off that electricity, they're synchronized to that flow, to that beat of power as it moves. And if that beat stops working, stops being steady, everything breaks apart. And then you really don't have a grid system anymore. You don't have a system of transporting electricity. And in many cases, you don't have a way of generating it too, if it's damaged your power generators. So what a black start is, is the program that is in place to re, and I think about it in terms of light almost, like re illuminate the grid, re power, recharge the grid, re-energize the grid, right? You know, as you're trying to get, get the system running again. And what that requires you to do is, is, you know, begin in one place, you know, you start generating electricity in one place. And then start kind of charging the wires again, moving it along only in so far as it's balanced where it can reach the required demand again and starting in several different places at once, re-energizing the entire system, which can take weeks to do. depending on how much damage is caused by the grid failure, it can be, it is almost inconceivable how tragic a historical event that would be in Texas. Doug Lewin (46:10.488)I quoted Pat Wood, the former chair of the PUC and chair of the Federal Energy Regulatory Commission saying it would be like being in the stone age again. Yeah, yeah. I mean, just to give an example to folks, you can't fill up your car at the gas station. You think, well, gas, that's not the electric grid, but it's a pump. It needs electricity. You can't even drive out of the state unless you had filled up before and you have enough range in your gas car to get out of the state, right? I mean, it would have been an absolute... Doug Lewin (46:37.656)Catastrophe. is, the way though, one of the things I'm most excited about, well, there's so many reasons to be excited about battery storage, but batteries work really well for Black Start because they can be supply and demand. And when you're trying to balance them, they can go both ways, which generator can't and generally load can't, but batteries can do both. It's also a reason why like distributed energy resources having the backup power packages, which the legislature passed as a policy. If the grid goes down and you're able to island, right? You're a hospital, you're a water treatment facility, you're a police station. In that situation, you would still have power. like there's, I think the knowledge that we were so close to that for, what was it? Four minutes, 37 seconds, right? That away from that has spurred some positive change. And I think this is where I wanna go next, Doug Lewin (47:28.352)Again, you're as deep into this as anybody, as a reporter and journalist talking to people all the time, you know, putting these stories together, you know, separating wheat from chaff to be able to really tell the story in your estimation. Like what has changed for the better at this point? Are we better off than before winter storm Uri and, and related to that? Doug Lewin (47:49.718)What hasn't been done? This is the question I get asked all the time. It's so fun to ask this question instead of being asked it. like, yeah, what are we better at and where has there been improvement and where has there not been? Where do we still need to see some progress to get towards a grid where we wouldn't have to worry about it every time it gets super cold? Mose Buchele (48:07.15)Yeah, mean, yeah, it's such a tricky, tricky question to answer. I mean, I think obviously the first thing people point to is weatherization or winterization. There has finally and belatedly, probably most likely, definitely, well, I mean, in my opinion, definitely belatedly, been an effort after 2021 to really put teeth on and do inspections for things like power plants and energy infrastructure. Mose Buchele (48:32.248)that could simply break down in the cold. And that's low-hanging fruit, but it's exceptionally important. And it seems to have helped. There are things like backup power and I was talking about those big fuel storage tanks that were more common decades and decades ago. Well, some of the answers that we've come across have been to kind of re-explore some of those options, right? So now there is more incentive for having dual fuel capabilities at power plants. Doug Lewin (48:58.678)Yeah, there is a program that PUC started called Firm Fuel Supply Service, which is exactly that. So what's old is new again. Mose Buchele (49:05.55)Yeah, yeah, you know, which if it works, you know, it works. you know, things like that should supply a little extra insurance. The most complicated part of this for me and maybe for you two, although I think that you've done a great job explaining it to me before in some of our previous interviews, is just are the different market changes that have happened. mean, like this is you can look on paper and say, well, they've made these costly changes to the way that energy is kept in reserve. They've invested more. in all these different programs with kind of incomprehensible names to keep more energy in reserve in case things get tight. And so there's a huge debate over like the kind of cost benefit of all that. But, know, we've seen, I think a little less scarcity than maybe we would have otherwise if some of that hadn't been in place. I'm not exactly, you know, advocating for it, but it does seem that those things have changed the dynamics a bit. Places where we have not seen a lot of movement, you and I have talked a lot and you've, you have talked a lot about energy efficiency, you know, for years and years and years. And that's something that seems as, you know, I interviewed you in the podcast, we had a bonus episode about this very issue and, and it seems one of the least costly and obvious ways of trying to bolster our power system that has been really not sufficiently addressed. And, you know, maybe There's always this session or next session or whatever, but there just seems to be some kind of intrinsic part of the political equation that makes that a hard nut to crack. And then obviously there's this thing that we're focusing on this season, looking at the kind of disjuncture that I want to say disconnect, but that's a disconnect. You can say disconnect. That's right. Between the, if we are going to, this is one of the central kind of questions of this season. If we're going to try to continue to reinvest in natural gas generation, as indeed our political leadership really is keen to do, in part because it is dispatchable, right? You know, they say, well, these are generators, on-off switches, and you can deploy them when we need the electricity. It is perhaps advisable to take a closer look at what went wrong with the natural gas system. in this massive power failure. And so that's really kind of where we're heading with this season. There were a lot of proposals on the table in the wake of the 2021 blackout to even relatively modest suggestions to kind of create a little more transparency in what's going on with gas, create what they were calling a gas desk or some type of a monitor at ERCOT that would take a closer look. Doug Lewin (51:48.906)No, no, but nobody at ERCOT or the PUC mentions the, the, word gas desk is, is verboten at this point, or you get into trouble for speaking it. I can say it. They need a gas desk at ERCOT. I mean, literally this was just an effort to like have awareness of what is going on in the gas fields, because that is, to say it's not transparent. I mean, it's the opposite. It's opaque. You don't know in real time what is going on out there. And if you're a grid operator and you need gas, In the wintertime especially, gas is a predominant fuel on our system and they don't know what's going on in the gas fields. then somebody tries, know, Brad Jones, who you interviewed in some of the episodes, may he rest in peace, former CEO of ERCOT, talked about this a lot. Like we have to have visibility into that. And you would have thought you said, we are regulating every aspect of the industry, price controls, all of it. You would have thought it was the most heavy-handed. They literally just wanted a desk in their control room to monitor gas. And it was treated like it was the biggest insult in the history of human. Mose Buchele (52:56.468)I just had a flashback because I interviewed Brad Jones in this room. He might have been sitting at this part of the table. you know, one of the things we touched on was this very issue. Yeah. And he was very articulate and open about that. I just recently, as part of my work on this new season, went back and listened to some of those hearings that happened a couple of years ago now on proposals for things like a gas desk and then some other maybe a little bit more far reaching legislation that would have just taken a look at some of the Mose Buchele (53:25.218)the market power of pipelining companies and gas suppliers. as you said, the gas desk idea was, it really was treated like somebody had set off a bomb, you know, and it's the kind of thing that exists in other places and seems to not interfere with. Doug Lewin (53:40.44)So sorry, got, yeah, yeah, yeah, I got us off on a tangent, but the point is like, that is an area of the energy system. And this is kind of really what you're getting into in season three. And disconnect is the right word. There is a disconnect between gas and electric. It is better than it was during your year. I think that that is true. There is more coordination going on between the railroad commission and the PUC, more communication, more awareness, but there is still a very significant disconnect that is frankly dangerous. Mose Buchele (54:10.552)Yeah, yeah, and this is something that, like I said, this is where we are focused this season. And it's been a wild ride. Doug Lewin (54:17.43)Yeah, yeah, yeah. I'm also just curious whether you get into it this season or it could be, I hope there's many, many more seasons of The Disconnect. I think I am like your target market, Moze. I love, I am consuming these episodes as much as you could put them out. But you know, there's this question of like who profited as well, right? And like, then you get into this whole notion, which you've already got into some in the first few episodes of the intrastate pipelines that do not have regulation from FERC. Doug Lewin (54:46.562)So they're only regulated by the railroad commission. There were some famous hearings in 2022, famous to me anyway, where then chairman Wayne Christian said, well, we don't regulate those. And it's like, well, but if it's a monopoly and the feds don't regulate it and you don't regulate it, who regulates it? And of course the answer is nobody. Mose Buchele (55:07.718)Yeah, I mean, and this is to get back to kind of our wonky discussion of regulated utilities at the beginning of our conversation. You know, if you're going to restructure or deregulate, on one hand, you may give up some price control, you know, which is what they obviously didn't, you federal energy deregulation starting on a Carter. But you also are supposed to break up that monopoly, right? You know, like you need both parts of it, right? You can't have the monopoly hanging out there then without any kind of Mose Buchele (55:37.262)guardrails put on how they exercise that monopoly power. And what you hear over and over again from people through history. And again, this is, you know, this is most recently come up in the context of post 2021, but it seems like every decade, this, this kind of rises its head up in out of sometimes out of the oil field. Sometimes it's oil, it's, it's producers, it's gas and oil producers that are saying in Texas, we need to take a closer look at pipeline market power because they feel like they're getting taken advantage of. Mose Buchele (56:07.016)And sometimes it's on the other end of the pipeline. It's someone like a natural gas power plant operator saying, we are negotiating these contracts with zero position of power. And again, so you started hearing that again. You hear it, like I said, through the history of this regulation, you started hearing it again after the blackout. again, just is not something, there were efforts that were made last session and you hear people still talking about it, but it's Doug Lewin (56:34.222)Absolutely, yeah, but nothing's really changed from that. No, and I think it's a great point because a lot of times people will talk about the oil and gas industry and it's really important to look at its component parts. You're absolutely right. A lot of times, and again, this goes back to like 1930s and some of the original regulation from the railroad commission, the producers were upset with the pipelines. This stuff runs deep. And to understand like what's going on today, to understand what happened during winter storm Uri, to understand why your power bill might be more, your gas bill might be more. Doug Lewin (57:02.348)you gotta understand that, that history. it's just, you know, the word story is in history. And I think you guys have just done a great job with, with the storytelling. So big fan of what you do. I think this is probably a good place to, to leave it, but I, but I'll ask you as I, as I do every guest of the Energy Capital podcast, what should I have asked you that I didn't? Any, anything, any, is there, is there anything else? And it's okay to say. Doug Lewin (57:24.366)No, Doug, this was the greatest interview ever. No, I'm just kidding. But no, no, like if we've said everything you want to say, that's fine, but I always want to give you an opportunity. Is there anything else you want to leave the audience with? Mose Buchele (57:34.796)Man, I feel like this has been pretty far reaching, but I... Doug Lewin (57:38.83)Mo's, I'll ask you this just in closing. you guys are obviously, there's stories and it's human stories. Can you think back to over the seasons, a particular human story that like really kind of got you? Mose Buchele (57:54.158)I mean, there are so many of those that. Doug Lewin (57:56.17)I know there are but you gotta pick one. Mose Buchele (57:59.032)I mean, the story that sticks with me the most is probably the story of a family who lost their mother during the blackout. She was an elderly woman who, this is a family, the Shaw family, they live here in Austin, and the siblings were caretakers for their elderly parents and they lost power and maintained heat in their house because they had a gas fireplace, actually. So, one of those, you heard a lot of people talking about how much they appreciated having that option during those cold days. But it was not enough to, know, seemingly to heat their full house and they lost their mother during that crisis. they were so, and remain to this day, opened to, they shared their story so well and invited us into their home and told us all about their mom. And, you know, I think about her, you know, every time the anniversary comes up. And actually I just called one of the, daughter's just a few weeks ago, just to check in. yeah, there are thousands and thousands of stories of hardship and loss that we should keep with us, you know, because you never want to see something like that happen. Doug Lewin (59:15.978)Absolutely. I think that's a very important guiding light like North Star is to remember that 247 Texans, at least probably more like eight or 900 lost their lives. And it is critical we get this right, you know, as much as possible. And I think your reporting has gone a long way to do that. So thanks for everything you do. And thanks for being on the Energy Capital podcast. Thanks most. Mose Buchele (59:41.045)Thank you, Doug. Doug Lewin (59:43.074)Thank you for listening to the Energy Capital Podcast. I hope you enjoyed the episode. If you did, please like, rate, and review wherever you listen to your podcasts. Until next time, have a great day. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.douglewin.com/subscribe

What if utilities could see infrastructure failures before they happen? What if grid operators, regulators, and energy companies could harness the power of artificial intelligence to prevent outages?Heat waves, droughts, wildfires, hurricanes, and winter cold snaps are getting more extreme. But as their intensity ramps up, so does computing power, and particularly the capabilities of artificial intelligence.In this episode of the Energy Capital Podcast, I spoke with Mary Cleary, VP, Marketing, Communications & Public Policy at Neara, a company pioneering AI-driven predictive modeling for utilities and grid planners and operators. Their technology is already helping major power providers anticipate and mitigate damage before storms, wildfires, and grid failures occur.We discussed how Neara’s platform builds hyper-detailed digital models of the grid, down to individual poles, wires, and even the exact species of trees near power lines. Using LIDAR scans and AI classification, utilities can create real-time risk maps that help prioritize maintenance, allowing them to proactively prevent outages before they happen rather than reacting after the fact.This technology is already delivering results. In Houston, Neara’s partnership with CenterPoint Energy has cut processes that once took a year and a half down to just a few hours. Rather than relying on slow, manual inspections, utilities can now simulate storm impacts and predict which infrastructure is most vulnerable before a storm makes landfall.AI is also changing the way utilities manage wildfire risk. By analyzing environmental conditions like wind speeds, temperatures, vegetation density, and the age and vulnerability of equipment, Neara’s models help utilities pinpoint the highest-risk areas, allowing for targeted prevention measures instead of costly, broad-stroke fixes.Beyond disaster response, we also explored the role of AI in grid modernization and demand forecasting. With Texas’ rapid energy demand growth, driven in part by AI data centers and industrial expansion, utilities need smarter ways to anticipate and manage electricity needs. Predictive modeling using artificial intelligence is giving them that capability.One of the most fascinating parts of our conversation was how AI can help utilities make more cost-effective investments. Instead of replacing entire sections of aging infrastructure, Neara’s software allows for surgical upgrades—determining exactly which poles need reinforcement, which lines need reconductoring, and where distributed energy resources could provide the most resilience.AI is often discussed as a massive new energy consumer, but as Mary pointed out, there’s far less conversation about how AI can be a critical tool for making the grid more efficient and reliable.This episode provides an exciting look at the future of grid resilience, extreme weather preparedness, and how AI is changing the way we think about energy infrastructure.As always, please like, share, and leave a five-star review wherever you listen to podcasts. Thank you for being part of the conversation!Timestamps00:00 – Introduction: AI, predictive modeling & the future of the grid01:58 – What is Neara? AI-driven modeling for utilities & extreme weather response04:33 – Case study: CenterPoint partnership (Houston’s 27,000 miles of lines)06:30 – How AI interprets LiDAR & optimizes storm recovery09:30 – Reliability vs. Resiliency: Measuring grid performance, customer expectations12:33 – AI disaster modeling: Hurricanes, floods & wildfire case studies15:45 – LiDAR & Dynamic Line Rating (DLR): Unlocking hidden grid capacity18:00 - Could AI help relieve the transmission constraints that contributed to energy emergency on September 6, 2023?20:1 6 – Winter storms & gas infrastructure: Predicting failures before they happen23:00 – Optimizing energy resource placement: AI’s role in siting generation resources24:22 – AI’s next areas of development and limitations & regulatory roadblocks28:00 – Flaws in reliability metrics (SAIDI & SAIFI) & need for predictive benchmarks33:34 – Balancing cost, reliability & AI-driven efficiency36:01 – Effective policy constructs for reliability and resiliency38:24 – AI, Senate Bill 6 & large load growth: The power of micro-solutions43:21 – House Bill 2555 & Texas grid investments: Balancing cost, data & outcomes46:45 – Regulatory innovation & final thoughts on AI-driven transformation48:18 – Conclusion & call to action ShownotesFurther Reading from the Texas Energy & Power Newsletter* You Get What You Pay For: Let’s Pay Utilities for Performance* Large Loads at the Lege: Grid Roundup #40* Texas’ Energy Future: A Conversation with Jimmy GlotfeltyAI-Powered Grid Resilience & Predictive Modeling* Neara’s Website – Explore Neara’s AI-driven platform for grid infrastructure modeling and predictive analytics.* How Neara Uses AI for Utility Infrastructure – Detailed breakdown of Neara’s AI capabilities, including digital twins and predictive risk assessment.* Neara Platform Overview* How Neara Works* Hurricane Preparedness Utilizing a 3D Digital Twin* LiDAR Utilization for Utilities* CenterPoint Energy & Neara Collaboration – Announcement of their partnership to enhance grid resilience in Greater Houston following Hurricane Beryl.* AI for Grid Optimization – The International Energy Agency's insights on AI’s growing role in modern energy systems.* Why AI and Energy Are the New Power Couple* Electricity Grids and Secure Energy TransitionsAI & Wildfire Risk Mitigation* Neara’s Wildfire Risk Modeling – How AI helps utilities predict and mitigate wildfire risks.* Neara’s Collaboration with Southern California Edison (SCE)* CenterPoint Energy & Technosylva Collaboration – Using predictive analytics for wildfire and extreme weather preparation.* How AI is Being Used to Fight Wildfires – A look at AI’s role in early detection and prevention.* AI-Powered Camera Networks for California Wildfires* Google’s Satellite Surveillance initiative (FireSat)* USC Scientists Use AI to Predict Wildfire’s Next MoveAI and Demand Forecasting for Energy Grids* Artificial Intelligence for Energy – U.S. Department of Energy’s take on how AI is shaping power grids.* How AI Can Help Clean Energy Meet Growing Electricity Demand* DOE Advancing Safe and Secure AI Research Infrastructure Through the National Artificial Intelligence Research Resource Pilot* DOE Announces New Actions to Enhance America’s Global Leadership in Artificial IntelligenceTranscriptMary Cleary (00:01.982)And what we're seeing so far already is that CenterPoint has been able to compress processes that once took them a year and a half down to just a few hours. Doug Lewin (00:13.134)How long do you think it takes a utility to figure out which power lines will fall in the next big storm? Days or weeks? You think maybe months? In many cases, it's actually years. And with extreme weather happening more frequently and customers expecting power back in hours, not days, the old ways just aren't cutting it anymore. But what if AI could predict grid failures before they happen? What if utilities had a digital model of every single power line, pole and tree so they could prepare for hurricanes, floods, wildfires, winter storms, whatever nature may throw at us before disaster strikes? This actually does exist. And that's actually what we're talking about in today's episode of the Energy Capital Podcast. I'm your host, Doug Loon, and my guest today is Mary Cleary, vice president at Nira, an AI-driven company revolutionizing grid reliability and resiliency. Today we'll break down AI's role in wildfire prevention, flood modeling, hurricanes and winter storms, why outdated reliability metrics are holding utilities and the industry back, how AI is changing the game for power markets and regulation as well. I'm excited about this one. It isn't just about technology. It's also about the future of the grid. Stick around because by the end, you'll know exactly why utilities that don't adapt will be left behind. As always, please like, rate, and review this podcast. Give us five stars wherever you listen, and please forward the episode on to friends and colleagues. It really does help people find us. Word of mouth is the most powerful, and we really appreciate your support of this podcast. Let's dive in. Hope you enjoy the show. Mary Cleary, welcome to the Energy Capital Podcast. Mary Cleary (02:00.056)Thank you so much, Doug. Really nice to see you. Great to meet you in person in Austin last week and really excited to be here. Doug Lewin (02:05.71)Yeah, it was great to see you in Austin. You guys pulled together a bunch of utilities to talk about what they're doing on resiliency and what you're doing on resiliency. This company, Nira, is really, really fascinating to me. Let's just start with a little explanation for the listeners as to what it is y'all do. Mary Cleary (02:23.95)Sure, yeah. So, Neera is a predictive modeling software platform that helps utilities take a more proactive approach to reliability and resiliency across the entire T &E system. So essentially what we do is we build a digital model of the whole network, including all the little details. you know, think things like the widths of the individual cables, the tree canopies, the fluctuations in ground slope, all those little nooks and crannies. Mary Cleary (02:49.888)And utilities then use that model to simulate scenarios they need to prepare for. So everything from ice storms to hurricanes, cetera. And that model then becomes a flexible environment for utilities to essentially test drive different types of remediation solutions. So once you have, for example, simulated what a category three could look like in your network, you might know which polls are going to fail. Mary Cleary (03:15.574)And what utilities might have once done is a simple rip and replace, right? Which as you can imagine can get quite expensive. But in our platform, what you're able to do is see that perhaps this, you know, force rank your risks and then match up solution by risk. So perhaps only a small percentage of those polls actually need to be replaced. And maybe of the, you the ones that don't, you know, maybe it's Mary Cleary (03:41.198)maybe you just need to add a stay and that's sufficient in the category three. And for the uninitiated, the stay is the thing that looks like hypotenus. Doug Lewin (03:48.142)Yeah. So we're going to get more into this as to different kinds of extreme weather events and what this works for. And I encourage folks to, we'll put a link in the show notes to a little video so people can actually see this. But so that people could get just kind of an understanding in their heads of what this is. This is, like you said, down to the individual wire, down to the actual, tell me if I'm wrong on this, but the species of tree and exactly how big it is. I mean, you're using LIDAR to get... Doug Lewin (04:18.218)extremely granular and take every single line in a utility service territory and the actual conditions on the ground so that then they can kind of rank order where they're going to go. Is that right? Yeah. So for Centerpoint, you guys announced a partnership with them. Centerpoint and Nira announced a partnership last fall. Mary Cleary (04:32.225)Exactly. Doug Lewin (04:42.83)And I was watching a news story about what y'all do with them. And I believe they said, I may be getting this wrong, but I think this is right. 27,000 miles worth of lines in their service territory. And Centerpoint actually has a fairly compact utility service territory. You start thinking about in Texas, Encore that has the entire Dallas, Fort Worth area, huge swaths of West Texas. Doug Lewin (05:07.48)To actually send people out and do visual inspections, which is what the utility industry has done forever, takes a long, long time and you just can't possibly get everywhere. So this is a use where AI can actually look at that whole system and figure out what the needs are. Can you talk a little bit about, and I know you're very early days, but there has been some press on this and some things you guys have said about it. Give a little glimpse for folks into what's going on in Houston. Mary Cleary (05:36.622)Yeah, absolutely. So while I can't comment on the specific things that Centerpoint is doing necessarily, what I can say is we're extremely excited about what we've seen so far. So, you know, in the broader scope of network governance processes, there are all these things that are very manual, as you alluded to. And what we're seeing so far already is that Centerpoint has been able to compress processes that once took them a year and a half down to just a few hours. Doug Lewin (06:06.68)So things that took a year and a half, basically getting people out to a site, recording what went on there, probably sending somebody back, having some kind of committee meeting. You're down to a couple hours because you are able to take this lidar and look at it. And then can you talk a little bit about, and this doesn't have to be specific to CenterPorter Houston, you're working globally, but how does AI figure into this? Because you guys are also an AI and machine learning company, correct? Mary Cleary (06:32.876)Yeah, yeah, great question. So the primary role of AI in our software is the classification of the lidar. So have you ever seen a raw lidar scan before? Have you ever seen a raw lidar scan? Doug Lewin (06:42.647)say it again. Doug Lewin (06:45.646)I'm not sure I have. Mary Cleary (06:47.374)It kind of looks like, you can Google image it, but depending on the quality of the LIDAR, it kind of looks like something between a Jackson Pollock painting or TV static, like kind of poltergeist-y. So it's not super intelligible. And the traditional processes for classifying LIDAR, which is what makes it actually usable, is manual, right? So someone actually sits and looks at the images and says, ah, this is a tree. Wait a minute, that tree looks about the same height as the distribution pole. It might be the same thing. Mary Cleary (07:15.47)It's very error prone, it's manual, and it takes a heck of a lot of time. So we're taking in LIDAR across an entire network. And what our AI does extremely well is classify that LIDAR automatically. So tree distribution poll and not just what's what, but like looking at the, you know, the sink depth of that tree and the fact that there might be multiple tree canopies layered over a line and be able to tell if there's a line under those tree canopies. Mary Cleary (07:43.394)So the primary role of the AI is in making sense of the actual network data. Doug Lewin (07:50.422)And then rank ordering, right? So it's really like a little bit of like a triage, right? Because you just, after Hurricane Barrel, right? There were so many problems and leaders all over the state, citizens all over their service territory saying, fix this, fix this, fix this. Well, you can't go to every single line and trim every single tree in the space of a few months. You have to know where the, what is the tree that is most likely to fall on a line? Can you talk about how you guys figure that out? Mary Cleary (08:19.63)Yeah, yeah, 100%. So I think you just raised a really, really important point, which is that when you're doing these processes manually, you're sending teams out into the field, you're only covering, you know, an inspector and a team can cover maybe like 80 to 100 polls in a visit, depending on the complexity and such. But, and then they're answering 100 questions per poll in some cases, right? So like, you see in that given field visit, you might come across a vegetation risk that is, you know, Mary Cleary (08:49.25)within, it's under two feet from a line, right? But then one circuit over or even 100, maybe it's one mile down the road, there's something that's six inch clearance risk. And you don't see that otherwise. the way you, it's all relative, right? Like it's whatever the biggest risk is that day is highly unlikely to be the thing that actually requires resources and attention. Doug Lewin (09:13.582)It's so fascinating. mean, it's just, it really is. You know, it's so interesting in the energy world, everybody these days is talking about AI and everybody's talking about AI in terms of the power demand that it has, right? my God, AI is going to crash the grid because it needs so much power. But I feel like there isn't nearly enough discussion. I brought this up on a couple of podcasts recently. I did on the one I recorded with a former commissioner, Jimmy Glodfelt as well. Doug Lewin (09:40.782)There's not nearly enough discussion on the use cases for AI to actually make the grid more reliable and more resilient. You and I have talked before, I know you have some thoughts about this. Could you talk a little bit about reliability and resiliency and even how you define those terms? I you are a company that is specifically devoted to those and I feel like sometimes we don't spend enough time defining terms. And when one person says reliability, Doug Lewin (10:08.386)They may be talking to somebody who thinks about it entirely differently. What do these terms mean to you and how are they the same? are they different, reliability and resiliency? Mary Cleary (10:16.79)Yeah, sure. So, you know, obviously, neither of them are new terms, right? But they're both increasingly becoming moving targets. And something that's been really encouraging to see, I think, is both utilities and policymakers actually think about how both of them need to be approached with a different or increased level of rigor, right? So on the resiliency side of things, the asset hardening capital allocation framework that maybe worked beautifully five to 10 years ago probably needs a rethink. Mary Cleary (10:45.41)And on the reliability side of things, you can no longer just look at safety and call it a day. Safety is, it doesn't actually include in many cases the severe weather impacts, right? So you're essentially excluding all the stuff that makes the biggest impact on the system and only looking at, excuse me, duration and frequency in quote, unquote, normal course operations. And so... Mary Cleary (11:10.008)You know, the other dynamic at play is loan growth, right? So objectively slash obviously that creates more demand that the system needs to service. But a vastly underappreciated dynamic there is what does that do to customer expectations? So customer expectations are, they're going up. They're not getting more forgiving. So we ran one of our recent consumer polls where a third of Americans Mary Cleary (11:37.366)said that they expect power to be restored after severe weather within one to two hours, and another third said they expected the same within three to five hours. Doug Lewin (11:46.518)Is that even possible? that a completely unrealistic expectation, or do think it's actually possible? Mary Cleary (11:51.33)I think it's, I mean, it's not gonna happen overnight, right? But I do think it's not impossible over the right time scale. Doug Lewin (11:59.522)It also depends what kind of extreme weather we're talking about, right? If it's a category five and you're on the quote unquote dirty side of it, right? The east side of a category five in the northern hemisphere. Are you in Australia? Mary Cleary (12:13.676)No, I'm in the Northeast. Doug Lewin (12:15.534)You're in the Northeast. Okay, okay. It's an Australian company, which is why asked that. But if you're the Southern Hemisphere, I guess it would work the other way. But anyway, the Northern Hemisphere, you're on the Eastern side and you get a category five, like one to two hours is probably completely unrealistic. But I think there are a lot of events where that could be possible. So are you guys actually like... So a hurricane is, for instance, forming in the Gulf of Mexico and you're a Texas coastal... Doug Lewin (12:44.75)city or utility that covers a Texas coast, if they were using you guys, could they actually put that storm with its features into AI and then into your AI engine and then actually see, if it goes this way at this level, this is the path it's going to take so they can pre-position crews and things like that? Is that a use? Mary Cleary (13:09.006)Exactly, exactly. So what you're describing is a use case we're really, really familiar with. we've got, so actually, did you, I don't know if you had a chance to speak with South Australia Power Networks at the event last week. Doug Lewin (13:20.718)heard his presentation. Yeah, was fascinating. So that was a flood situation, Yeah. Yeah. Yeah. Tell us about that. Mary Cleary (13:27.798)Yeah, so what you're describing is a very, very similar scenario where we had a flood model kind of pre-set up that the model actually existed and this flood was coming in and they were able to layer on in real time those conditions. So as if that storm in the Gulf is brewing. So you essentially bring that situation to life in real time in the model and you see exactly where the water levels are going to get dangerously high, where you need to... Mary Cleary (13:55.352)de-energize or it's safe to re-energize and to your point where you can send people where it's safe. Doug Lewin (14:01.23)amazing. So we've talked about a couple of use cases, floods, hurricanes. Wildfires is another one I think is probably an obvious use case for this too. Can you guys talk about how you're trying to mitigate wildfire damage? Mary Cleary (14:17.806)Yeah, for sure. know, wildfire is such a multifaceted challenge, right? It's not, it's not a, you know, it often gets pinned on veg and veg is certainly a part of it, right? But that's really just one part of it. There's asset failures, there's design flaws, there's a lot that can and does go wrong. So in terms of how we mitigate vegetation, it's typically vegetation, sorry, wildfire risk. It's that typically a combination of a utility using our model. Mary Cleary (14:46.092)to combat their risk on all relevant fronts. Doug Lewin (14:50.03)So with Wildfire, you're trying to... I'm trying to think of what you would input into that model when you're dealing with the hurricane. I think everybody can kind of picture it. You've seen the images of the eye and the clouds and the rain and all that around it. But with Wildfire, it's a little tougher. You're trying to deal with what are the wind speeds? What is the humidity? Are these all inputs that you can enter into the platform? Mary Cleary (15:18.112)Yeah, so some that come to mind off the bat are wind speeds for sure, but also conductor temperature, right? So when the conductors get hotter, you know, on hot days when wildfires more likely, they are more likely to sag and come into contact with things like vegetation or a structure, potentially worse and ignite. So we're doing all that very granular clearance modeling to figure out where that's actually a risk. Doug Lewin (15:45.614)So do you guys actually, I'm just gonna ask the stupid questions, because sometimes the stupid questions are the ones everybody's wondering and just is afraid to ask, but I won't be afraid. The stupid question here is, have you guys, with LIDAR, you just have the whole globe or do you have to go, like somebody hires you and then you do their section of the world, or is this model just has everything in it already? Mary Cleary (16:08.526)Yeah, no, so we don't actually capture LIDAR utilities. Sometimes they have it already. Sometimes they don't. Sometimes they'll capture LIDAR in advance of working with us because the model requires it. Doug Lewin (16:20.206)Describe exactly what LIDAR is. I think I understand what radar is, but explain to me exactly what LIDAR is. Mary Cleary (16:26.286)Yeah, sure. So starting with the acronym, the fun part, LIDAR stands for light detection and ranging. And essentially what it is, is imagine a bunch of lasers shooting off of, sometimes it can be, sometimes it's a helicopter, sometimes it's a fixed wing aircraft or drone even in some cases, or a handheld device. But picture laser shooting off of some device that hit whatever is in front of them, right? So that could be the ground, it could be a wire, it could be a pole. And they bounce back. Mary Cleary (16:54.664)onto the device that is doing the capture and takes measurements of that distance. And so because it's measuring distance, it's fundamentally really, really good at solving for 3D questions versus imagery, which definitely has its place and role in all of this, but is more 2D. Doug Lewin (17:18.743)Got it. When you were talking about line sag, and you said it can get very granular, that led me to think, I'm wondering if this actually has, and maybe you're already doing this, maybe it's just something that's on the roadmap or something you wouldn't do at all, but the dynamic line rating gets talked about a lot in Texas. I've written about it before. Folks that are regular readers of the newsletter will remember probably. Doug Lewin (17:46.04)depending on how long they've been regular readers, but it was one of the most read pieces I ever wrote was on September 7th, the day after the only energy emergency Texas has had since winter storm Uri. And on that day, there was a decision made by ERCOT to actually reduce the amount of power flowing over a line. And the thought was, well, we could Doug Lewin (18:10.914)we could overload that line. It was really hot. This was September 6th. It was still extremely hot. And they were worried that they were going to overload that line. But my understanding is that their sort of dynamic line rating for those just listening, I'm doing air quotes right now, is not super dynamic. They take a couple of different buckets. And like if it's over this temperature, we turn it down this much. But if you actually had measurements and AI modeling, you might find you could flow more power over those lines. You might. Doug Lewin (18:40.404)I you could flow less power over those lines, but you would have... Is that a use case for either what you do or other AI engines? Mary Cleary (18:49.184)Yes, absolutely. And we do do that. We do do that. yeah, I mean, what you're describing is, I think a common, one of the reasons this hasn't been done in the past, right, a common challenge with this is like, it's totally impractical, right, to send someone out in the field and manually measure the distance between the graph clearance of every wire, particularly at distribution, which is, I think, totally, totally underappreciated component to overall network capacity. Mary Cleary (19:16.096)And so when we talk about modeling those granular clearances, that's exactly what it is. So sometimes our customers will find that there are bottlenecks, e.g. clearance requirements where they can't run the line any harder without reaching clearance. But what those bottlenecks can then become is potentially a punch list of things that they can do, design modifications to their network, where they can then actually run more power. Doug Lewin (19:40.834)reconducting things like that. Mary Cleary (19:42.68)Exactly, Mary Cleary (19:43.121)exactly. Or maybe, maybe reconducting, but also, or maybe, you know, what if we made this poll a little bit taller? Would that work? Doug Lewin (19:51.17)Very interesting. And do you actually need physical sensors on the line for that or can AI sort of handle that knowing what the line is and what the temperature and humidity is? Mary Cleary (20:02.86)Yeah, so we don't rely on physical sensors for that. Doug Lewin (20:06.476)It can entirely be done with AI. It's so fascinating how quickly the world is changing. It's such a challenge just to even try to keep up. It's amazing. Yeah. OK, I want to ask about a couple other use cases. Winter storms, that's something people in Texas think about sometimes. Yeah, is there a use case there? Mary Cleary (20:30.05)Yeah, absolutely. So ice loading is something that comes up quite a bit. And it really comes down to the same variables, essentially, as the pull load, the tension on the line, and temperature. So freezing temperatures, what that looks like, what precipitation looks like, and wind. Doug Lewin (20:48.942)Yeah, so that would deal with what is obviously a very real problem. It's not talked about as much, but February, 2023. Obviously, February, 2021 was Winter Storm Uri. February, 2023 sometimes referred to as Winter Storm Mara or Mara. I've never actually heard which way it's supposed to be pronounced. But in Austin and other utilities around central Texas, they had a ton of ice really started to cause tree branches to fall. So again, that's sort of a... Doug Lewin (21:17.678)an obvious use case for this. I'm also just wondering about there's a winter storm coming, you're looking at temperatures in the Permian of a certain level. Can you get into modeling what might happen to gas infrastructure? Could you get into modeling what demand actually might look like, which is an area ERCOT has really struggled with? And I've been critical of them for that, but frankly, that's really hard to do. You have to really understand the building stock. Doug Lewin (21:47.182)Can you start to get into how much power will actually be needed and where are the areas where it's most likely that you would see problems with power infrastructure, gas infrastructure, et cetera? Mary Cleary (22:02.092)Yeah, absolutely. you know, one of the things that's great about our technology is it can be used to, it's very good at modeling physical assets. And so whatever the physical asset makeup is, it's very adept at identifying risks therein. And in terms of like system-wide modeling, one of the things that's also great about our technology is the ability to answer questions that go upstream and downstream across the, across the energy supply chain, right? So like coming back to your point on Mary Cleary (22:32.194)reliability earlier, I think something that is changing in how we talk about reliability is not just obviously looking beyond safety and including things like severe weather, but looking all the way downstream to things like generation mix and understanding how does that affect customer outage minutes from a resource availability perspective. Doug Lewin (22:51.906)Tell me more about that. Yeah, what is, I mean, I know what that means, but like, how does that factor into an AI engine that is mapping? I don't, I understand what you mean, I don't understand the connection. Mary Cleary (23:03.244)Yeah, sure. So what I'm saying is, you know, obviously the energy ecosystem is very complex, right? Lots of moving parts. And that's one of the reasons why it's so hard to make better, faster decisions. in helping utilities forecast resiliency, we're looking at all those moving parts and how they turn together. And it's almost like the AI plays this role of a programmatic dial that you can turn up or down to look at reliability and resilience risk. Mary Cleary (23:33.046)evaluate objectively how much of that risk is there and how much and what does it cost to buy it down. Doug Lewin (23:39.416)That's so interesting. So you could then conceivably, when you're talking about resource mix, you could look at, this would be an area where on a certain, say, a side of a transmission line, maybe there's a constraint. This would be a great place for battery storage to go. Or you have so much battery storage in this one particular place, but there's really no gas resources here. This would be a place to look to put a gas peaker. Doug Lewin (24:07.086)I'd assume there'd be a big relevance there for distributed energy resources too. We can't put any really large infrastructure in this particular place, but maybe some customer-sided stuff would be a particularly good solution. exactly. How far along... I think part of what I'm trying to understand, and I'm sure everybody listening is trying to understand, is how far along is AI on this at this point? Because I think Neera, it's safe to say, is... Doug Lewin (24:36.814)state of the art, you guys have been at this for what, seven, eight years, you're through a series C, you have a bunch of different deployments, but it still feels like this is early days. Like there's just like the advancements are probably going to like... So what are the next areas where you're excited, where you're like, I can't wait to see what AI will do with fill in the blank? Mary Cleary (25:00.974)So that's excellent question. Mary Cleary (25:05.474)You know, I think that there's a lot to be excited about, but I think there's also a lot to be cautious of, right? AI is, I'll use the hackney phrase because it's true, but it's not the silver bullet. And there's a change management journey that goes along with adopting AI, right? it's, can't, like, in other words, I guess an example of what I'm saying is you can't suddenly... Mary Cleary (25:31.054)cover much more ground in your network inspections, right? Or you can't suddenly discover 100 risks where you were only able to previously see one to 10 at a time and then not be able to do anything about it. So there need to be surrounding processes or infrastructure, not in the physical sense of the horse, but that actually support these processes. So that's one thing I would say about it. But I think the bigger opportunity is something I'm extremely excited about. Mary Cleary (26:00.622)is that AI can actually help between both utilities and policymakers help encourage and really drive this idea of a proactive approach to resiliency and reliability, which I don't think is controversial. don't think anyone thinks that's a ridiculous statement. But unfortunately, the reality says otherwise, where a lot of the processes and regulation that are in place today actually actively discourage taking a proactive approach. Mary Cleary (26:29.41)And think Eric, Brian. Doug Lewin (26:31.402)Yeah, what's an example of that? That makes sense. Mary Cleary (26:34.318)typical of that Mary Cleary (26:34.918)is California, there's something they not so affectionately call the 45-day rule, and I'm sure there are examples of this in other states as well. But it's essentially that if you discover a risk, you have 45 days to actually remediate it, which is fine. It sounds sensible, right? No one wants risks lingering out there unattended. Except that is essentially, how is that different from playing Whack-A-Mole? You find a risk, you fix it. You find a risk, you fix it. Doug Lewin (26:54.614)Festering, yeah. Mary Cleary (27:02.456)What if that risk that you're suddenly pouring all of your resources into at that moment isn't what you actually need to be paying attention to? Doug Lewin (27:09.11)It may not be the biggest risk at all. There could be a bigger risk somewhere else, but you found it 20 days into that 45-day period, and so you let it go. Mary Cleary (27:17.526)Exactly. And even worse, what if there are a hundred or a thousand versions of that same risk and in aggregate, there's a more cost-effective way to solve that risk. Mary Cleary (27:29.73)instead of just doing it one off. Doug Lewin (27:32.27)It brings me, you when you're a hammer, everything's a nail. But this brings me back to it. I wrote a piece on this like not quite a year ago. was right after Hurricane Barrel about you get what you pay for. And starting to think about performance-based models where we're really paying utilities a lot more if they do their jobs exceptionally and less if they're not. I won't ask you to weigh in on that, but I do think there is some merit in that because then you can get out of that sort of... Doug Lewin (27:57.454)hamster wheel of the way things have been done and it just has to be done this way as opposed to putting the focus on the outcome you actually want to drive towards. do, want to ask you about, you've mentioned a couple times, Sadie and Safie, and I think probably most of our listeners know what that is, but I actually want to take a minute and just kind of double click on that. So these are, I'll give my explanation, then you correct me and say it better than me. Doug Lewin (28:25.624)And then I want to get into a little bit like what might be a better metric. So, salient safety, whatever its system average, but the D and the F are the important... Go ahead. What is it? Mary Cleary (28:37.556)It's System Average Interruption Duration Index. Doug Lewin (28:40.872)So Doug Lewin (28:41.122)duration and frequency, right? So how often are outages happening and how long do they last? But as you mentioned, a lot of times the extreme weather events are removed from that metric because it's sort of viewed as like force majeure. It's like, well, this is what are you going to do? Sometimes the power just goes out. But as you said earlier, customers are not cool with that. Like that's not okay. expect... Doug Lewin (29:07.362)to have the power back on. Have you seen any... I was on a panel at a conference a couple of months ago with a guy from Con Ed, the utility in New York, and he said they are actively trying to come up with different metrics because the old ones are so flawed. You work on this stuff around the world. Have you seen better ways to actually measure the outcomes we're after? Mary Cleary (29:28.782)don't think there's something perfect just yet. think the perfect metric will be something that is forward-looking, that's more of a leading indicator instead of a lagging indicator. And I think using predictive modeling technology puts utilities in a place where they can actually do that reliably and then communicate that to policymakers so that there's a sheer understanding. Doug Lewin (29:31.298)That's for sure. Doug Lewin (29:53.39)So basically, that's really interesting. So you could basically run a predictive model and say, hey, if a category three hurricane hit Corpus Christi, if a wildfire with wind speeds of 55 miles per hour hit Amarillo, God forbid any of these things happen. But you could, if a flood of Hurricane Harvey in 2017, we got a repeat of that and... Doug Lewin (30:20.238)2028, you could plug those into the model and you would say, based on existing systems and processes and infrastructure, we would expect power to be out this long. And then basically say, here's the triage list, utilities fix as much as you can, and the better you do against that benchmark, there could actually be a performance incentive potentially. Could be an increase in rate of return, could just be a cash payment, could be any number of different things. Doug Lewin (30:48.226)which I think the vast majority of customers would support because then you would actually have lower outage times, which is what everybody's after. Is that what you mean or do you mean something different? Mary Cleary (30:56.588)I think that's, I don't think that angle is out of the realm of possibility. Doug Lewin (31:01.91)Is there a different way that you're thinking of that though? how, what, because that's the way I understood it when you said it. Am I understanding it wrong? Mary Cleary (31:09.804)Yeah, no, maybe another a little bit more color I would add to it is I guess it avoids this really unsavory situation, right? Where the pendulum's going back and forth between reliability and resiliency and affordability. And you got something bad happens, no one likes the outages and the impacts of them, but then the shop wears off and people go, my gosh, all this stuff is really expensive. Do we really need all this? Is this necessary? Mary Cleary (31:36.064)And then you end up in a situation where you're deliberating until the cows come home about your torturing cost line items and then nothing happens. And then something bad happens again and people wonder why nothing's changed. So that's really the situation I'm referring to, which is like, let's stop having this high temperature back and forth between utilities and policymakers where policymakers sees a really big price tag and utilities see the Mary Cleary (32:04.674)since the thing that needs to get done. And they're not speaking the same language. Doug Lewin (32:11.564)I think some of the reason why that happens in my view is there's this sort of information asymmetry where the utilities know their system better than anybody else and the regulator doesn't have nearly as much information. But I'm not sure how we get over that problem. Have you guys ever worked for utility commissions or grid operators or is it like utility side? Mary Cleary (32:39.884)No, we're defying the utility sign, but we are seeing our technology being used as the vehicle to objectively communicate what's needed. And so when policymakers bristle at, you know, eight, nine, 10 figure investment, utility can then use the technology to say, okay, you don't like that. Well, here's what happens if we don't do that. You're probably not going to like that situation either, right? But then it becomes this way to evaluate how much risk you can buy down and at what cost by saying, Mary Cleary (33:09.742)Okay, maybe we haircut that investment by 30 % or 15 % or whatever. Can we look at the outcome, the proposed forecast outcome on the other side of that? And is that enough to justify the investment? Do we feel comfortable with that? And that kind of thing, that kind of dynamic really takes that temperature down when utilities and policymakers are trying to make those really difficult decisions together. Doug Lewin (33:30.446)Yeah. mean, you say eight, nine, 10 figures. And in Texas, for the resiliency plans the utilities are doing, I think we're bumping up against 11 figures at this point, because, yeah, Houston's is 5.7. Center points is 5.75 over three years proposed, not approved. Encore was a little over 3 billion over three years. I think, though, there is... I don't think anybody... I'm certainly not arguing, and I don't think anybody could... Doug Lewin (33:57.194)there doesn't need to be investment made in the distribution grid. That seems obvious and axiomatic. The question is how much and how do you balance that affordability? And I think so much of it is about getting better data out there and letting everybody see it. Like you said, here's the predictive modeling, here's what happens if this happens. Here are the targeted things that can be done and rank order and what they cost so that policymakers and regulators Doug Lewin (34:25.014)and utilities together, stakeholders, et cetera, consumer advocates can kind of make decisions together about, you know, this is you do Can you, you can definitely respond to that. I'm also just interested in like, how does all of this play into the affordability side of things? Does this give us, does it do what I just described? Are there other ways I'm not thinking of where we're using AI for utility modeling and that sort of thing could actually significantly save money, reduce the cost of investment? Mary Cleary (34:54.252)Yeah, so I think on the affordability piece, the primary role that AI can contribute to that is by helping size with the remediation solution is, right? So we're getting away from this, these pulls are weak in a category three, they're not going to make it. Let's just replace, let's panic and replace them all. Instead, let's add accessories like stays were appropriate and maybe even the ones that you need to replace. Maybe some of them can be one for one, wood to wood. Mary Cleary (35:21.506)And maybe there's only a handful of select hyper-targeted scenarios where you need something stronger like a steel or composite. Doug Lewin (35:29.664)And in the model, we'll get that granular to say in this spot because of maybe the geography, this one sits a little higher, it's a little more exposed to a coastal wind or whatever. This is the one that needs to be replaced as opposed to 50 of them. It'll get that granular. That's really interesting. All right. Good stuff. let's, course, it's the Energy Capital podcast. Let's talk about... Doug Lewin (35:58.67)policies. And again, and it actually may be before we jump to policy or maybe just as part of the same answer, I am curious just kind of where in the world you guys are working right now. We've talked about Centerpoint, you've mentioned Australia. Where else are you guys doing work around the world? Mary Cleary (36:15.82)Yeah, so we're working with utilities in pretty much every major region of the US right now. We're also in Europe. We have several customers across Europe, Asia, UK, South America increasingly. So I think we've got the continents covered except the Arctic. Doug Lewin (36:33.826)Yeah, no Antarctica yet, but know, they're in dream one day. So you see policy constructs all over the place. And this is one of the things I just think is not done nearly enough. know, Nehruq and other organizations, International Energy Agency, those kinds of organizations do a good job trying to like cross-pollinate, help people see the way, you know, folks do it differently around the world. But you guys get to see that. Doug Lewin (36:59.136)Are there any particular policy constructs that you think are particularly effective around reliability and resiliency? Mary Cleary (37:05.836)I don't think there's something yet that I would point to and say that's the thing that everybody should be doing that. I think, to come back to this idea of taking a more proactive approach, I think there are baby steps being taken around the world that kind of smell like that, but I don't think we're there yet. Doug Lewin (37:25.826)Yeah, I think that's right. I think this is, I always like to say, think, you know, there's a lot of innovation happening, obviously, on the tech side. There's a lot of innovation happening in the markets. Policy innovation is important too. You have to be able to like think differently because the regulatory constructs pretty much everybody's operating in were developed and evolved over a hundred years ago. And they've evolved some, of course, since, but like not a ton. Doug Lewin (37:55.566)It's an area that for the technology to actually have as much impact as it could, you're going to need the regulatory side to catch up, I think. Mary Cleary (38:05.888)Agree? Agree. Doug Lewin (38:07.566)But is there anything I should have asked you that I didn't? Anything else you want to cover? Mary Cleary (38:14.414)Let's see. Doug Lewin (38:16.782)There's so much, right? I mean, it's such a fascinating space, but. Mary Cleary (38:21.1)Absolutely. So Doug, think maybe there's one last thought I'll leave you with, which is that when we talk about the grid, we're often talking very big terms, right? We talk about massive amounts of money, we talk about sweeping projects and massive time scales and things taking a very long time. But something I am confident we're going to see more of and very excited about is this idea that we could see grid transformation happen on a more micro scale. Mary Cleary (38:50.306)with more micro outcomes. this idea that the energy transition and the idea of resiliency doesn't need to be this massive nail biter, right? Like everyone is on the edge of their seats every time there's a bad weather report. There's the Senate Bill 6 action earlier this week, so everyone's wondering what's gonna happen with large loads and such. And so I think technology like ours can play a really critical role Mary Cleary (39:20.062)and allowing utilities to take better, faster, more thoughtful, smaller steps, but in faster succession. So it keeps everyone on the same page and working towards the outcomes that we all want in a way that's much more affordable for consumers on the other end of the energy bill. Doug Lewin (39:37.144)So I was going to end, but now I want to ask about that. So we're going to go to another couple of minutes if that's okay. So Senate Bill 6, obviously I wrote about it a little bit and we'll put it in the show notes where I wrote about it and I'm sure I'll be writing about it a lot more in the coming months. And we're recording on February 14th, so the bill was just filed a few days ago. By the time you're listening to this, there could have been hearings or what have you. Doug Lewin (40:01.368)But it's a bill that really does kind of change some of the ways that large loads interconnect to the grid, change potentially some of the requirements for the generation they need to bring, and then change how they pay for transmission. I think, and Mary, I'll just say this the way I perceive it, and then you can change it, say it however you want. I think, I'm not sure if this is what you're getting at, but I think there's a little bit of sort of a freak out happening right now, frankly, where a lot of folks are like, my God, they're seeing the numbers of we might need 50, 60, 70 more gigawatts in the space of five, six, seven years, and that looks really scary. And I get it. We have added 13 gigawatts last year, an average of 11 gigawatts the last four years. Is what you're saying that these... And obviously, this is... Doug Lewin (40:55.246)but there's a whole lot of companies working in this space that AI actually, while it is itself a big load, actually, as we were talking about earlier, help solve some of the problems too. Almost itself be energy aware of when it's using energy, when it's using the energy that's on site. Maybe even helping to deploy distributed energy resources, help folks that have batteries, either in their garage on the wall or just in the car, like actually deploying assets and resources in a smarter way that makes us more reliable. And I didn't give my own definition earlier, Mary, but my own definition is reliability is do you have enough supply to meet demand? Resiliency is can you deal with extreme weather in a way where you stay online as long as possible and then you're back up that restoration is a very short period of time and distributed energy resources help with both of those things, right? Because they're adding supply and they're giving you resiliency because it's close to where you're at. So maybe I'm completely twisting around what you meant when you brought up Senate Bill 6, but that's where my head goes. What did you mean when you said that? Mary Cleary (42:06.092)Yeah, so for me, it was just yet another example of all the anxiety about energy. But I think you make an interesting point about how much is AI contributing to the anxiety and how much anxiety can it potentially detract from the equation. I don't know exactly what the answer is. I can't speak to a self-aware, energy-consuming AI anytime soon, although that'll be very exciting to see. But I do think there is massive opportunity for it to be a net anxiety relief. Doug Lewin (42:39.692)Yeah. And when you talk about the micro solutions, can you talk more about what you mean? Is that just like what you were saying earlier, like getting down to the individual poll? Or does that also deal with like micro generation? Does that come into the picture too? Mary Cleary (42:52.046)It's more thinking at the asset level, asset resiliency. Doug Lewin (42:56.814)Yeah, yeah, yeah. No, it makes a lot of sense. And I think it's really important for all these different things, whether it's distribution infrastructure, generating resources. We have to think of the micro and the macro together and how they fit together, because the really small things can actually add up to a whole lot. All right, cool. I'm going to ask the same question again. Is there anything else you'd like to say, because then I just added a whole lot to what you said at the end? Anything else you want to say before we end, Mary? Mary Cleary (43:20.866)No, I just had a question for you and it just went right under my head. No, you know what? It was actually about House Bill 2555 been out in the wild for some time now, but how is your level of optimism changed, if at all, since then? Doug Lewin (43:40.366)Well, honestly, this conversation actually has made me more optimistic about 2555. What I worry about 2555 is it's a little bit of a blank check. Now, I don't want to be Dougie down or just be negative here because I do think that that overall is a good policy. I think that you need utilities to spend money on the distribution grid and on resiliency, and it's a regulatory framework that gives them some certainty emboldens them a little bit to actually invest in the distribution grid, which as we all saw after Hurricane Barrel and other events, that wasn't the only one. Again, the Austin ice storm in February, 2023, there's all kinds of examples of where the distribution grid needs investment. My worry about it is there isn't enough data that folks can really look at and together and agree on. And I think that what y'all are doing, Doug Lewin (44:38.078)And on this podcast, I'll interview a lot of different companies going forward that do this, because I think the competition in this space is pretty interesting. And I think that there's going to be a lot of competition in this space. I think you guys are an early mover, and I've seen examples of your technology. I'm pretty excited about it. But to me, that is one of the most exciting things that the regulator, the utility, the stakeholders can all kind of see. No, here's the predictive modeling. Here's what happens if a cat three, cat four, cat five hits this particular area with the infrastructure you have in place. It ain't pretty and here's the rank order of what you could do to make the most impact at the lowest cost to reduce the damage and the potential pain and suffering that would happen after that. So I have no doubt that we need to spend on resiliency and I understand why lawmakers wanted to pass 2555. The information asymmetry and there's sort of the general lack of data that's been out there is one of my biggest concerns about that balance between reliability, resiliency, and affordability. I think what you guys are bringing to the table is potentially transformative. So I'm pretty excited about the technology. What do you think of 2555? Mary Cleary (45:52.846)You know, I am really excited, obviously, based off our work with utilities in Texas, what I'm seeing so far there. But I think it sets Texas very well apart from other states in this country, as well as other folks globally in a lot of ways. Because a lot of utilities, I won't name names, but they're still thinking about things through very narrow lenses, right? They've got their pet problem and Texas is a bit unique, right, because it experiences a whole laundry list of things, whereas other areas of the world maybe experience two or three of them. But I think... Doug Lewin (46:30.811)We've got it all here in Texas. You name your climate risk. It's right here. Mary Cleary (46:36.226)But just zooming out and thinking about everything through that resiliency lens, think that's a really good example that others would move themselves to follow. Doug Lewin (46:45.548)Yeah, yeah. I it makes a lot of sense. Yeah, I just think the layer that hasn't been there yet is the regulators really insisting on seeing the data and not saying that they haven't done it yet. It's just like we haven't had these tools. Right? So again and the data wasn't necessarily available, you know? Exactly. I get my pen and paper and I scribble something down for you and it's like, as a regulator, are you going to put much stock in that or do you want to audit something and not take my word for it? Doug Lewin (47:19.886)Yeah, again, regulatory innovation, right? think regulators really insisting on we need the best possible data. They have a huge job. It's damn near an impossible job. I don't envy them for having that responsibility, but they've got to make sure they're looking out after ratepayers and making sure that, we always say keep the lights on. No, it's like making sure the heat and the air conditioning are on. That's so people can find a flashlight. It's the heat and the air conditioning. Keep that running. Mostly air conditioning in Texas, though. Anyway. Mary, I really appreciate you taking the time. I'm excited about Nira. I am excited about everything I've heard so far. I'm looking forward to following the growth and evolution of this company and all of these kinds of use cases to hopefully improve outcomes for customers. And yeah, thanks for taking the time. Mary Cleary (48:15.438)Pleasure speaking with you, Doug. Thanks so much for having me. Take care. Doug Lewin (48:18.04)Thanks, Mary. Thank you for listening to the Energy Capital Podcast. I hope you enjoyed the episode. If you did, please like, rate and review wherever you listen to your podcasts. Until next time, have a great day. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.douglewin.com/subscribe

This is a free preview of a paid episode. To hear more, visit www.douglewin.comNote: We had some minor audio issues in this episode—thanks for bearing with us. The conversation is still clear and well worth the listen. Appreciate your patience!John Arnold is one of the most successful energy traders of all time. He built his career by understanding how systems work, where inefficiencies exist, and how markets respond. Today, as a …

Solar energy has the potential to revolutionize Texas’ power grid, lower costs, and provide resilience in extreme weather. But what happens when some companies selling solar systems aren’t playing fair? In this episode of the Energy Capital Podcast, I spoke with Sara DiNatale, an investigative reporter whose in-depth four-part series “In Broad Daylight” for the San Antonio Express-News uncovered disturbing scams from unethical and predatory companies. DiNatale was honored for her work on this series as one of only 15 out of 500 entries to win the George Polk Award for “intrepid, bold and influential” reporting.The series started with a few homeowners’ struggles but quickly exposed a larger pattern — solar systems that weren’t properly installed, homeowners left with massive loan payments for panels that didn’t work, and a lack of consumer protections to hold bad actors accountable. DiNatale detailed how some homeowners were aggressively targeted by door-to-door salespeople, pressured into signing contracts that promised energy savings but often resulted in tens of thousands of dollars in debt for non-working systems.In Austin and San Antonio alone, 18% to 24% of solar installations failed their first inspection, meaning homeowners were left with what one expert called “expensive roof decorations.” Some systems continued to fail on second and third inspections, leaving families with long-term loans for technology that wasn’t even functional.One of the most heartbreaking cases she covered was the Duncan family in Corpus Christi, a low-income, hearing-impaired couple sold a $100,000 system they never should have been sold. Their credit was destroyed and the installer vanished.We also explored how some solar companies operate like multi-level marketing (MLM) schemes, recruiting young salespeople with promises of making six figures, teaching them to target elderly homeowners, and encouraging deceptive sales tactics. Some of these companies even offer cash incentives upfront to make the deal seem more appealing, without disclosing that this money is really just wrapped into the loan.The good news? There are many great solar companies and ethical solar installers in Texas, and there are steps consumers can take to protect themselves. We talked about what consumers should look for. We also discussed legislative fixes, including a requirement that no company gets paid until an installation passes inspection, licensing standards for solar installers, and consumer protection laws to crack down on deceptive financing practices. A bill was filed by Senator Zaffirini at the Texas Legislature (SB 1036) to address many of the problems mentioned by DiNatale.Solar remains one of the most promising energy solutions for Texas, but without proper oversight, these scams could continue to spread — especially as the demand for distributed energy grows.This is an episode you don’t want to miss. If you or someone you know is considering solar, listen before you shop, much less sign any contracts.As always, please like, share, and leave a five-star review wherever you listen to podcasts. Thank you for being a part of this conversation!Time Stamps00:00 - Introduction to the Energy Capital Podcast05:14 - The Importance of Inspections and Approvals07:49 - Real Stories of Victims in the Solar Industry10:26 - Legislative Solutions and Consumer Awareness12:44 - Sales Tactics and Red Flags in Solar Companies18:09 - The Solar Sales Landscape21:47 - Understanding Financing and Dealer Fees29:43 - Consumer Complaints and Industry Accountability30:09 - Positive Actors in the Solar Industry35:09 - Advice for Potential Solar Buyers37:20 - Financial Considerations for Solar Energy Investment38:53 - The Importance of Battery Storage in Solar Systems39:47 - Challenges in the Solar Industry: Trust and Education42:10 - Consumer Protection in the Growing Solar Market44:01 - Regulatory Measures and Licensing in the Solar Industry46:48 - Tracking and Accountability for Solar Sales Practices49:31 - The Need for Consumer Guides and Resources51:52 - Engaging with the Solar Community and ResourcesShow NotesConsumer Protection and Solar Industry Scams* Sara DiNatale’s Four-Part Solar Investigation (San Antonio Express-News) – The full investigative series exposing deceptive solar sales tactics in Texas.* Sara on X (Twitter) * Texas Attorney General’s Consumer Complaints Division – Where Texas residents can report fraudulent solar companies.* US Department of the Treasury Solar Scams Resource – Guides on avoiding deceptive home energy sales tactics.* FTC Consumer Solar Awareness Articles - 1 & 2Grid Reliability and Interconnection Failures* Austin Energy Solar Program –* CPS Energy Solar Information * ERCOT Interconnection Process – How solar systems connect to the grid and what happens when they fail inspections.High-Pressure Sales Tactics and Deceptive Financing* Better Business Bureau (BBB) Solar Complaints – Reports on misleading solar sales practices in Texas.* Solar Energy Industries Association (SEIA) Consumer Guide – What homeowners should look for when considering solar.* NABCEP Solar Installer Certification – How to verify if a solar installer is certified.Legislative Fixes and Future Protections* Senate Bill 1036 - 89th session bill relating to the regulation of residential solar retail transactions. * Texas Legislature Bill Tracker – The Legislature’s site for monitoring bills and hearings.* Nevada’s Solar Consumer Protection Program – A model Texas could adopt for preventing predatory sales.* California Solar Licensing Requirements – A look at other states’ approaches to regulating solar contractors.Key Quotes from the Episode* "We found Texans paying for solar panels that don’t even work, systems that failed inspections multiple times, leaving homeowners with nothing but massive loan payments." – Sara DiNatale* "In Texas, you don’t need a license to install solar panels, which means the person drilling holes in your roof might have zero experience." – Sara DiNatale* "This is a problem that needs urgent legislative fixes, requiring an inspection before payment is one simple way to protect homeowners." – Doug Lewin This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.douglewin.com/subscribe

In his State of the State speech this week, Governor Abbott acknowledged the obvious: “Our rapidly growing state also needs an increasing supply of electric power.”The Governor didn’t specify what types of energy we need, though he did give an implicit nod to an all-of- the-above approach, including renewables and storage:“We now provide more power than ever before. In the last four years, we increased power by 35%. As a result, Texas ranks No. 1 for electric power generation.”The fact check on this: it’s all true. Texas produces more power than any other state by far, and we added the most power over the last four years — bringing our full nameplate capacity from about 125 gigawatts before 2021’s Winter Storm Uri to an astounding 170 gigawatts today. Moreover, 92% of that 35% increase Gov. Abbott cited is from wind, solar, and storage (75% from solar and storage alone).Yet as the Governor rightly noted, we need more. A lot more.The Texas Legislature is nearly four weeks into its 140-day session, and legislators have a lot of important decisions before them. But there is one threshold choice that could change the trajectory of the state for generations:Will Texas leaders focus their time and attention on building vital energy infrastructure that capitalizes on a once-in-a-generation opportunity to grow our economy? Or will they try to harm the renewable energy and storage that’s supporting the grid, lowering bills, and bringing massive investment to rural Texas?One path will propel Texas’ economy and energy leadership for decades; the latter will leave us poorer and more vulnerable. One would build up our state, the other would tear down a vital industry.It is a time for choosing.The PromiseIn his speech, the Governor rightly prioritized the funding of water infrastructure. The effort to fund a secure water supply is absolutely vital to our state and deserves undivided attention.He also called “for Texas to lead a nuclear renaissance in the United States,” having previously appointed an Advanced Nuclear Reactor Working Group that last year recommended the creation of a fund to support new nuclear reactors and a Texas nuclear industry. This effort should also rightly take up significant legislative focus.In addition to those critical items, the legislature this year also will need time to consider major pieces of legislation dealing with:* Large loads like data centers and how to pay for transmission and other grid costs;* Energy waste reduction to increase reliability, particularly during winter storms;* Consumer protections from predatory solar installers; and* Backup power to ensure that nursing homes, water treatment facilities, fire stations, and other critical facilities have reliable onsite power during and after natural disasters.That’s just a start, and that’s just energy. There's a lot of work to do and not a lot of time to do it — which is precisely why it would be so foolish to spend any time on punitive, anti-energy proposals to tear down our state’s nation-leading renewable energy and battery storage industries, and the 60,000 Texans employed in them.The DangerTexas needs more power, the Governor said. Unfortunately, the legislature is now considering Senate Bill 819, which would strangle the vast majority of renewable energy development in Texas. With rising load growth, inflation, and $30 billion in potential transmission costs, mostly to support Permian Basin oil and gas operations, this is a terrible time to take the lowest-cost resources out of the mix — not that there’d ever be a good time to raise Texans’ electric bills by tens of billions of dollars.If SB 819 (or a similar anti-energy bill) passes, then electricity inflation will skyrocket. Your electric bill will skyrocket. And legislators will never hear the end of it.Supporters will say that such efforts are not about kneecapping renewable energy, but just look at the language below. With SB 819, the preamble asserts the importance of protecting our state’s natural resources and limiting the development of “renewable energy generation facilities,” but somehow never mentions toxic coal ash “ponds” or the mercury, arsenic, selenium, and other poisons they hold. Nor does the bill even mention oil and gas drilling. Wind turbines would have to be more than half a mile from anyone’s property line, while oil rigs would still be allowed right up to the edge of the line and only 100 feet from a state park or school. This is not about protecting natural resources.Remarkably, the bill directly invokes “the police power of the state” to put the nation’s most draconian regulations on private property owners who want to develop renewable energy on their own land — quite an invocation for some supposedly conservative legislators.In a speech known as “A Time for Choosing,” Ronald Reagan said: “What does it mean whether you hold the deed … or the title to your business or property if the government holds the power of life and death over that business or property?” Indeed.For many Texans, the ability to put solar, wind, or batteries on their land is a matter of life and death for their family farms and ranches — these resources provide vital income streams that allow them to hold onto property in their families which, in some cases, has been in their families for generations.Former Republican legislator John Davis testified last session that the seven wind turbines on his ranch provide “steady, reliable, predictable income that allows my family to keep the ranch intact and make investments into its future as well as for the future generations of my family.”Why would anyone want to take that away from him?Why would a conservative state government so severely restrict private property owners as SB 819 proposes to do? Moreover, renewables have pumped $50 billion into rural Texas ranches, farms, and local governments for schools, roads, and other infrastructure — why cut off that funding for communities that need it?And if the bill’s supporters really want to protect Texas land, why aren’t they including all energy projects?OutlookThis isn’t the first time Texas has faced this threat — SB 819 closely resembles a 2023 bill that would have radically expanded government regulation and restricted private property rights. The conservative Texas House of Representatives stopped it.Hopefully this session, the conservative Texas Senate won’t waste time on this effort to slow down the development of new power sources that Governor Abbott says we need. Hopefully, conservatives, moderates, and progressives alike will choose to protect private property rights and oppose efforts to expand “the police power of the state.” If they do so, they’ll also be voting for lower electric bills, and a stronger Texas economy.There simply isn’t time to waste. The legislature will only spend so much time on infrastructure and energy issues. They have less than four months to expand our water infrastructure, launch a nuclear industry, figure out how to connect large loads, reduce energy waste, protect consumers, ensure backup power at critical facilities, and more.The choice is clear: set up future generations for success, or waste time trying to hobble the fastest growing source of power in the state which we desperately need.As our Governor reminds us, our rapidly growing state needs an increasing supply of power. So it’s time to choose: More energy or less energy? Freedom or “the police power of the state?” Private property rights or big government? Abundance or scarcity?It is indeed a time for choosing.This is a free post. Please share it widely and please consider a paid subscription to support the Texas Energy & Power Newsletter and the Energy Capital Podcast. Thank you! This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.douglewin.com/subscribe

This is a free preview of a paid episode. To hear more, visit www.douglewin.comIn this episode of the Energy Capital Podcast, I had the pleasure of talking with Jimmy Glotfelty, commissioner at the Public Utility Commission of Texas (PUC) from the summer of 2021 through the end of 2024. With decades of experience across the private and public sectors, Jimmy is the rare person who brings both a developer and a regulator’s perspecti…

In this episode of the Energy Capital Podcast, I spoke with Congressman Greg Casar about some of the most pressing challenges and opportunities facing Texas’ energy system. From addressing worker protections during extreme weather to rethinking Texas’ grid structure, our conversation explored a range of ideas championed by the Congressman, including* The Connect the Grid Act: Casar introduced the bill on the three year anniversary of Winter Storm Uri. The bill aims to improve grid reliability by interconnecting ERCOT with the national grid. We explored the positives and negatives of that proposal, including a recent MIT study that found the bill would reduce outages by 40-80% in a system similar to Winter Storm Uri, assuming comparable power plant failures— depending on how many transmission lines are built to interconnect ERCOT. Casar also highlighted the economic benefits, including new revenue opportunities for Texas through clean energy exports. And I asked him about the potential downsides including a lot more regulations before Texas builds more infrastructure. * Balancing permitting reform with consumer protection: While Casar supports streamlined permitting to speed up transmission and clean energy projects, he also emphasized the importance of keeping key consumer protections in place. * Protecting workers in extreme heat: With heat the leading cause of climate-related deaths, Casar discussed the need for federal heat safety standards to protect outdoor workers, including those in construction and delivery services. He pointed to recent preventable deaths as evidence of why this issue demands immediate attention.* Opportunities for workers in the energy transition: Casar also focused on the challenges facing oil and gas workers during the energy transition. Through his American Energy Worker Opportunity Act, he hopes to provide a clear path for fossil fuel workers to transition into high-paying clean energy jobs without sacrificing pay or benefits. This approach prioritizes stability for workers while supporting long-term economic growth. We talked about how, even though Texas is producing more oil and gas than ever before, there are 100,000 fewer oil and gas workers in Texas today than in 2014. This episode and the many I’ve recorded with Republicans, including the one last month with Governor Rick Perry, isn’t about picking sides — it’s about being more curious than judgemental. I hope you’ll listen regardless of your political leanings, and I hope you’ll find this discussion as interesting and thought-provoking as I did.As always, please like, share, and leave a five-star review wherever you listen to podcasts. Thank you for your support!This is a free episode, but many of the episodes, as well as the archives, Grid Roundups, and more are for paid subscribers. Please become one today!The Texas Energy and Power Newsletter is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Timestamps: 00:00 - Introduction to Congressman Greg Casar06:29 - The Climate Crisis: A Personal and Political Perspective12:51 - The Connect the Grid Act: Addressing Energy Reliability19:28 - Interconnections and the Future of Texas Energy25:37 - Bipartisan Opportunities in the Energy Economy33:50 - Worker Protections in a Changing Climate39:11 - Transitioning Fossil Fuel Workers to Clean Energy JobsShownotes: Grid Interconnections and Reliability* The Connect the Grid Act – Congressman Casar’s proposal to interconnect ERCOT with the national grid, reducing outages and enabling clean energy exports.* MIT Study on Grid Interconnections – Research demonstrating how linking Texas to neighboring grids could have prevented up to 80% of power outages during Winter Storm Uri.* Southern Spirit Transmission Project (Pattern Energy) – Transmission line connecting Texas to the Eastern Interconnect.* Grid United El Paso Project – Connecting ERCOT to the Western Interconnect to expand energy sharing and improve grid flexibility.* The Southern Spirit transmission line could connect Texas grid to the southeast. Will it ever happen?Clean Energy Investments and the Inflation Reduction Act (IRA)* Inflation Reduction Act (IRA) Overview – The largest federal clean energy investment package in U.S. history.* 45X Advanced Manufacturing Tax Credit – Providing incentives for clean energy manufacturing, including solar panels, wind turbines, and batteries.* Clean Energy Investments Dashboard (E2) – Tracks jobs and investments related to clean energy projects spurred by the IRA.* Texas Enterprise Fund – State program that Casar highlighted as a model for attracting clean energy manufacturing.* DOE Loan Programs Office – Supporting financing for large-scale clean energy and grid-related projects.Worker Protections and Climate Safety* American Energy Worker Opportunity Act – Casar’s initiative to transition fossil fuel workers into union-backed clean energy jobs.* Federal Heat Safety Standards – Proposed by the Biden administration to protect workers from extreme heat exposure.* Workers Defense Project – Advocating for better working conditions and stronger labor protections for Texas construction and energy workers.* Texas Observer Article: Heat Deaths and Worker Protections – Coverage of heat-related worker deaths and the ongoing push for heat safety regulations.Energy Transition and Technology* Texas Geothermal Energy Alliance – Mentioned as a potential growth area for transitioning oil and gas workers due to transferable skills.* NuScale Power – Casar briefly mentions nuclear energy, including advanced technologies like Small Modular Reactors (SMRs), as part of the future energy mix.* Department of Energy Office of Nuclear Energy – Supporting nuclear innovation and new projects.* U.S. Climate Alliance – Texas is not currently a member, but Casar highlighted federal initiatives for state collaboration on climate resilience.Key Quotes:* “We’re no longer talking about preserving the planet for future generations—we’re talking about saving lives and livelihoods today.” – Greg Casar* “The Connect the Grid Act isn’t about taking control away from Texas. It’s about making sure the lights stay on and Texans don’t suffer through another Winter Storm Uri.” – Greg Casar* “We need to support oil and gas workers as they transition into new roles. They powered this country for decades, and they deserve stability and good jobs in the clean energy economy.” – Greg Casar* "We’re not asking Texas to give up its independence. What we’re asking for is smart interconnections that allow us to export clean energy and prevent major grid failures." – Greg Casar* "The Inflation Reduction Act isn’t just about solar panels—it’s about creating stable, well-paying jobs in manufacturing, geothermal, and other industries that can benefit everyone, including oil and gas workers." – Greg CasarTranscriptDoug LewinCongressman Greg Casar, welcome to the Energy Capital Podcast. Congressman Greg Casar Thanks so much for having me. Doug LewinSo you obviously made a big splash when you introduced the Connect the Grid Act just about a year ago on the anniversary of Winter Storm Uri. And I do want to talk to you about that. But before we go there, I'd like to just get a sense of your vision for energy, dealing with climate change, anything related to those issues, both as an individual, but also obviously as the chair of the Congressional Progressive Caucus. Doug LewinWe're recording nine days into the Trump administration. It's a really fascinating time to be chair of the progressive caucus. So just want to get a sense of, of, your vision and the caucus's vision, for energy and for climate action. Congressman Greg Casar Well, tragically, climate issues are now front and center in our daily lives. We're no longer talking, as we may have a decade or two ago, about preserving our planet for our grandchildren. We're talking about helping protect your life today. We're no longer talking about how this may cost us money in the future if we don't invest in clean energy. You're fueling the climate crisis in your mailbox right now as home insurance rates shoot up. If you're in places like Florida and increasingly in Texas, there's entire home insurers ditching the state. so even though I'm a relatively young elected official, I remember when I was first campaigning for office 10 years ago, we were talking about the looming climate crisis or the threat of climate change. But now I think progressives are pivoting. To make this no longer just a progressive theoretical issue in the future, but instead a bread and butter daily issue for voters right now. I wish we weren't in that place where the climate crisis was already hitting us so hard, but now that it is, we should be talking about this as an issue that affects voters of all political stripes and all political backgrounds. Because when I knock on a door now, people do talk about Winter Storm Uri and how that hurt them and their families. They recognize that the cost of rebuilding Los Angeles after these wildfires could wind up, I think, being greater than the entire cost of the entire Inflation Reduction Act, the biggest climate investment in our nation's history. So that's where I think things stand right now, is that this is a bread and butter issue for working people. We've got to make this, we've got to take on energy issues, both for our safety and for just not just our prosperity, just to make sure that things don't end up costing a huge amount. Doug Lewin Yeah, absolutely. You know, it definitely seems like with each passing year, as these various climate fueled events continue to add up, it seems like we would pass some kind of a tipping point where things would really change. And yet it doesn't. I you talk about 10 years ago, I remember 20 years ago with Hurricane Katrina and thinking, this will definitely be a point where things will change and it doesn't necessarily change. Let's get into a little bit more of, where you think change should happen. you introduced, as I just mentioned, the Connect the Grid Act. Can you describe for the listeners what that would do and why you think it's so important? Congressman Greg Casar Winter Storm Uri, I think, changed everything as it relates to energy and the grid here in Texas because it just hit everyone so hard, except critically. Almost all of us here in Texas have family or friends or people we know in places like El Paso or places like Beaumont that are on the edges of the state that were interconnected to other parts of the country. And so I was in touch with my family and friends and places all over Texas to check in on them and we clearly saw that those who are interconnected to other parts of the state did not have the huge, massive power outages demanded by ERCOT that the rest of us did. And suddenly, people like governor Abbott going and blaming wind power or whatever, just felt that those excuses suddenly fell completely flat. Before the idea of Texas's independence from the rest of the country maybe sounded cool, but it didn't serve us well in our immediate needs. And so when I got to Congress, I thought I would co-sign onto whichever bill there was that said that Texas's grid should be internet connected to the national grid. And I found no such bill. In fact, all of the big grid legislation championed by both sides of the aisle, all of the transmission legislation basically always had an exception for Texas, always said, all of the supplies everywhere except for ERCOT. Everybody just decided to leave a big Texas-sized hole, donut hole, in the middle of the country. And that's just not going to work. I mean, if we're supposed to be the energy capital of the country, how is it, one, that the lights can go off and people keep on tracking to see if the lights will go off? And two, how are we going to serve this entire country's electric needs as our needs for electricity continues to grow if we think about transmission, just cut Texas out as a Texas-shaped hole every time. So we filed the Connect the Grid Act because the federal government does guarantee electric reliability basically as a right in this country. And what we don't do is say that there needs to be a certain amount of transmission connectivity in order to achieve that goal. But in Texas, I believe that because of the lack of interconnectivity, we aren't achieving the level of reliability guaranteed in the United States. And therefore, we want to set a reliability standard and require a certain amount of transmission to be able to go in and out of the state in a certain level of connectivity. so that if the Great Act passed, essentially that would require this level of connection to start being built out between Texas and its neighboring National Grids. Doug Lewin So I want to talk about both the positives and the negatives of that, the upsides and the downsides and get your thoughts. So on the upside, on the positive side, there was a study that MIT put out over the summer, and we will link to that in the show notes, that showed that if we... Congressman Greg Casar I've never gotten a call from MIT saying, hey, we're going to study your bill and see if it does what it says it's going to do. We all crossed our fingers. like, well, we sure hope this works. Doug Lewin If they came back and said, sorry, Congressman, your bill is crap. It would have been a bad day, but they did not do that. They actually said what they did was really interesting. They took a thousand different simulations of a Winter Storm Uri type of event. just to get this out of the way, because I hear this all the time, people are like, oh, that could never happen again. It could happen again. It happened in the 1980s. It was 1989. There was a very similar system. it was not a one in a million. It's actually two within 40 years. There's nothing to think we couldn't get another one. it might nothing to think it might not even be worse. But they took a Winter Storm Uri situation modeled the same number of outages that we had during Uri like 50 % of the natural gas plants are offline, 40 % of wind, 43 % of coal, etc. And then looked at if there were interconnections as laid out in the Connect the Grid Act, and you have a range in the bill. And so they said the range of reductions and outages would be between 40 and 80%. It might've been like 43 and 79 or something like that. But basically between 40 and 80 % less outages. One thing I don't think they actually got into in that study was what's called Black Start, had we lost the whole grid. We would have actually been able to get back up quicker if we had more interconnections. It's harder to bring the grid back up if you're only sort of, indeed, indeed. But if you did, if you ended up in that situation, more interconnections would make it easier. So those are two of the big upsides. Do you want to say any more about those or add any other positives that you see if we went down that road? Congressman Greg Casar Sure would be great good to just not lose the whole grid. You one, you would, of course, save a bunch of money if you don't have the mass outages. mean, there was there's calculations that you had over $100 billion in damages, economic damage, just from the ERCOT outages we had during Winter Storm Uri alone. So there's a real economic savings in the disaster moments. But what isn't talked about as much is also the economic output for the state of Texas when other people are in disaster moments. Because part of the idea of the United States of America is that people help us out when we're in trouble and we help other people out when they're in trouble. And Texas, of course, has a lot of land available for energy development. And there are plenty of states around us that if they have a giant storm cloud on over them or they have a massive economic development project they want to engage in. Rhat we might be able to export and sell energy from Texas. And the MIT study shows that there would be likely over $100 million in revenue yearly back into ERCOT to be able to lower our own energy prices or be able to strengthen our own grid. Because sometimes, or oftentimes, the sun is shining and the wind is blowing and workers are at work in Texas, and there might be trouble in Oklahoma or in New Mexico or in Louisiana. Doug Lewin Yeah, or even more to the point, like on the East Coast or the West Coast, right? Because there's the saying, the wind is always blowing, the sun's always shining somewhere, right? So if you have the more interconnections you have, the more ability you have to move that power. Congressman Greg Casar And of course, we want to address the increased energy need across the country as we electrify things more and more, not just for climate reasons, but also because we know that it's more effective and cheaper, then it's better for the whole country. Now, I know we're primarily talking to a Texas audience here, but part of how we get the U.S. Congress on board is that it's much better for the entire country for us to be able to move electricity all across the country. As our electricity demand continues to increase, an increased electrical production, increased electrical use and transmission makes us competitive around the world. Doug LewinYeah. And it is kind of weird when you think about it, just in the sense that we're, you know, Texas has been an energy exporting state forever, but that's not forever for a hundred years, right? But that's plus spindle top, right? 120 years. So, but that's oil and gas. And for some reason we, we don't export, energy to power, I should say. Yeah. Congressman Greg Casar Yeah, that's weird, Doug. Everybody feels like we want to set up export terminals for liquid natural gas but don't want to electric molecules from and sell them between here and Louisiana. Doug Lewin So I do want to get your thoughts about this though, because I think there is a potential sort of like a different path, which would be additional interconnections between ERCOT and the East and the West without a full interconnection, which still would achieve that aim. So there's a couple of projects. I'm not sure if you're familiar with them, but one is by Pattern Energy. call it Southern Spirit, I think is what it's called. It's like from. West Texas, Houston Chronicle had a great series on this. We'll put a, we'll put a link to that in the show notes too. From West Texas into the Eastern interconnect. Uh, there's a project that, uh, grid United, Michael Skelly and his group, uh, are working on that would connect. Um, it's actually within the state. It's kind of a really interesting one, but it's from within ERCOT into El Paso, but thus would connect to the Western interconnect. And with those, you could export the power. Then if there's an emergency, you turn around the flow and bring power in. But you wouldn't have the full interconnection, which then would have Texas under FERC jurisdiction, which like heading into a, you know, four years or just the very beginning of four years of the Trump administration, like I would think, you know, that you might see that there's be some benefit of not having Texas under FERC jurisdiction. ERCOT has this slide they put out all the time that shows if you have to go through the FERC process to build transmission takes 10 to 12 years in Texas, we can usually get it done in five to six. So there are advantages to not being interconnected. And I'm just wondering if you've thought about maybe like this different path of having these additional interconnections without the full interconnection. Congressman Greg Casar Look, I'm a supporter of the Southern Spirit line, a supporter of interconnections between the state. You know, even if you had Southern Spirit at its at sort of its largest end of transmission, you would need multiple times that if you really wanted to deal with the problem. And I'd say go ahead and build multiple times of those. I think one of the challenges that you see and you can it's not hard to read between the lines on this, even if you're not fully plugged in and just reading the media reports on it is that they're having to continue to maneuver to make these connections smaller or kind of more smart and interesting like you just described within the states, but going into El Paso in order to try to avoid the question of, well, how do we deal with federal regulation? And some of those federal regulations, I'd be fine with figuring out how to streamline them and accelerate things. Some of them are there to protect the consumer. And I'm always skeptical of maligning the entire process when sometimes some of it's really there to take care of you and me against somebody that wants to take advantage of us and make a bunch of money on it. And so I do think that there is a real benefit of those interconnections. But I also believe that if we just. Bit the bullet and just said, look, we're part of the United States of America. We should stop trying to use all of these loopholes to not be a part of the United States of America. Once we get over and just figure out what parts of the FERC process we want to improve, I think a ton of these interconnections would quickly get built because the market demand is there. I don't think anybody thinks that it's in our economic interest or safety interest not to have these interconnections and everybody just keeps dancing around the FERC question. So I'm fine for people to keep dancing the best they can and build out those interconnections. But I think that we get there way quicker and way faster if we just do the right thing rather than continue to dance around it because we don't want something to maybe cost us a couple of years here or there, but it ends up costing us 20 years of dancing. I that makes sense. some of the things that slow down transmission projects and generation projects in other states don't apply in Texas. And that has to do partly with how we've structured our grid, which we would still have a lot of say over even under FERC. Also Some of those studies that I've looked at don't always take into account how other states deal with zoning and planning and permitting on their own. So I wouldn't lay, of course, I don't have the slideshow in front of me that you're talking about, but just in general, when somebody says to me, hey, if suddenly we're under FERC, Texas is going to go from six years to 12 years on transmission. I take that with a full salt shaker of salt. And, you know, as a former city council member that has been a big advocate for a lot more housing supply and on the board of Austin Energy or Public Electric Utility here being a big advocate of a lot more energy supply, I am deeply sympathetic to people that say there's stuff in permitting processes that we don't need to have and also deeply knowledgeable about there being corporate shills that want to say something is wrong with the permitting process. That's actually the main thing we want in our permitting process. We want plants to be safe. We want transmission lines to work and be smart and not be duplicative. But then we also need to make sure we plow through sort of NIMBYISM and concern trolling and needless red tape. Both of those can exist. And I think that you know, this old way of thinking of you're either team more permitting or team less permitting is just, you know, not the right way of thinking about it when you're talking about energy, just like when you're talking about housing. Doug Lewin Yeah, totally. And this is actually one of the things I most love about doing this podcast is to be able to go kind of a few levels deeper than just what kind of appears on the surface and really kind of understand where people are coming from. Because, yeah, I mean, I think a lot of people would assume different things about different members of Congress based on what letters after their name on what they would think of permitting reform. it's the truth is actually much more complicated. Speaking of areas where there might be things that are not intuitive based on the letter after somebody's name. I do want to talk to you about these early days of the Trump administration and particularly where the Inflation Reduction Act is headed, what is kind of the future of some of the spending. We're recording on January 29th. Just yesterday the administration gave a directive and Congressman Greg Casar You're recording in the post-constitutional world, Doug LewinWell, we'll, we'll see. We'll see where this goes in the courts. Yeah. It's a pretty wild thing, right? For the executive branch to say an act of Congress, and the previous administration with contracts signed that those contracts wouldn't be honored, which is what it looks like they're saying. We'll see how all this shakes out. what, what I want to, I, I'd be interested in your thoughts on that for sure. I also though want to kind of, I want to understand, I mean, you've been in Congress for a while. You've worked there for a while. You've seen kind of where different members come out on this stuff. I'm really interested in the areas of the Inflation Reduction Act, for instance, like 45X, which is the provision that is for manufacturing incentives. And we're seeing a lot of manufacturing come into states like Georgia and South Carolina and Tennessee and Texas. And I think if the administration just halts all of that funding as it appears they want to do and all of those tax credits, there's probably going to be a lot of Republican members of Congress and Republican governors that are pretty upset at that. Where do you think there might actually be bipartisan areas to kind of work together on the energy economy, the clean energy economy, however you want to talk about it over these next four years? Congressman Greg Casar I do want folks to have this in context of where we are right now. It was just yesterday that it became clear the Trump administration froze or said they were going to freeze basically all federal funds that flowed through states and municipalities and grants, which everybody rightfully freaked out about. I mean, there are nine states that receive over 45 % of their overall state budget in the form of federal funding and federal grants, all nine of them. In fact, being Republican controlled states from Wyoming to South Dakota to most prominently Louisiana, where the Speaker of the House and the House Majority Leader are both from. Medicaid portals got shut down because so much of Medicaid is administered through the state. And then the Trump administration said, sorry, that was a glitch, website glitch. They're back on. You know, a court then quickly halted the order based on multiple Supreme Court precedents that have existed, including a unanimous one. And so that's where we are. What I hope and expect, but don't know, you if somebody's listening to this podcast a month or two from now, what will happen. I hope and expect that we are not really in a post-constitutional order, like I joked about here earlier, and that courts make it very clear. That when Congress has passed a law and appropriated dollars, that those dollars are then sent out. Because if we wind up, I do want to spend more of my time assuming that that is what happens, but if we wind up in a world where that isn't held up, will become a whole new world about how budgets and laws are passed in the United States of America. Because how could you have a bipartisan law where I say, okay, I'm happy to fund this program and this Republican state, but we do need money for these hungry children in this democratic city or what have you, or we need disaster funds. We're going to vote for this bill that I may not love, but it has funding to rebuild North Carolina and California. And then what happens if President Trump just gets to say, well, I just not going to rebuild California, even though that got passed into law. I mean, how could Congress operate? How can a budget ever get passed? How can we do almost anything if the president can just say take back seas. I it's just totally nuts. And so my hope is we don't wind up in that world because if you wind up in that world, I just don't know how to tell what nobody will be able to tell you how this is going to work anymore. Doug LewinI mean, at some point the Supreme Court's gonna have to make that decision, right? I mean, at some point this has got to be headed to the Supreme Court and they're either gonna weigh in or not weigh in, but by not weighing in, they will have affirmed the lower court. At some point the Supreme Court's gonna have to say whether or not a president just has absolute power to void contracts. I mean, this is like, yeah. Congressman Greg Casar And the point being is the Supreme Court has already weighed on this multiple times on the side of if Congress puts something into the law, the president's got to follow it. The question is, this Supreme Court that was packed by Donald Trump and that he's testing out deliberately right now, will they hold that up? I think I expect that they will, but we will see. In the world that they do uphold that precedent, Doug LewinExactly. Congressman Greg Casar and when we pass something into law, actually has to move forward. Then there are real opportunities, there are going to be some opportunities, many opportunities to save the Inflation Reduction Act from being slashed. Because as you pointed out, some of the biggest recipients of the kinds of Inflation Reduction Act investments to bring manufacturing back to the United States. Are places like Marjorie Taylor Greene's own district. These are communities that need these jobs the most are seeing a resurgence of American production and manufacturing, and we need that so badly. And so the house has extremely slim margins. Once Trump finishes appointing some house members to his cabinet, then you could have many cases where it's just a one vote margin in the House to get anything passed. So any Republican who could potentially lose significant investments in their district can essentially veto a bill. So you have some members that, you I think at the core of the Trump agenda, in my view, is to pass continued corporate tax breaks and billionaire tax cuts to essentially repay the major industries and the big billionaires that not only bankroll Trump in the Republican Party, but that also are just Trump's buddies at this point. You know, when you see the front row of inauguration being these billionaire buddies of Trump's, I think that's really at the core of the agenda. But there are then these warring factions within the National Republican Party that want to, you know, continue to shrink government to strangle it and drown it in a bathtub and won't want those levels of billionaire tax cuts without cutting programs and Medicare and Social Security are extremely popular programs. They're the one of the biggest parts of our budget, the military. They don't want to cut even though there are certainly some war contractors that are profiteers that we could potentially try to take a look at. But I doubt that they'll actually go there because there are again members that are so tied in with those private defense industries that that may not get cut. And so now they're trying to go after what they see as quote unquote sort of woke and Green New Deal policies, which is really a very, you know, what they might call that would be a tiny sliver of the budget. And once you look at the major investments in what they might call, quote unquote, the Green New Deal or whatever it is they want to call it, you look at it, it's, you know, investments in making sure that there's a battery manufacturing plant in a part of the country that has lost industrial jobs and wants to regain those industrial jobs. So it really puts them in a rock and a hard place. And I think in the positive aspect of this is that between that rock and a hard place, maybe we actually get past the name calling and the labeling of stuff and people start saying, hey, you know what? This is just a good idea. Even though Joe Biden signed it into law, building our capacity for manufacturing solar panels, building our capacity for manufacturing batteries, researching the energy technologies of the future is a good idea, whether it's because you want to stay competitive with China, whether you want to bring back manufacturing jobs to the United States, whether you just want to be a politician that makes sure unemployment goes down in your community. Maybe regardless of the letter next to your name, this is a good thing. I hope that's where we wind up. It hasn't been my experience this last term in Congress, but I'm hoping to make it our experience because it's where we need to get to is just get some of these things off of the partisan chopping block and make sure that if it's just good for the country, that it should just be good. Doug Lewin Yeah, mean, bizarrely, ironically, whatever, we're in a place now where if you were to design like Tabula Rasa, a, you know, American energy dominance, America first energy agenda, like a lot of it would be the stuff that's in the IRA, like manufacture it here, compete against the Chinese, don't let the Chinese, you know, government and industry control clean energy over the next decades. yeah, mean, hope springs eternal. hear you that the experience doesn't always like match up with what you think might make sense, but there's at least an opportunity maybe I think for some the, for some bipartisan work to happen over the next few years. Hope Springs eternal. I do want to ask you before we run out of time about the American Energy Worker Opportunity Act and your work related to the, some of the federal heat rules. I mean, this is, this seems to me like one of the biggest issues that just doesn't get talked about that much. mean, look, I, and, and I hope people from all parts of the ideological spectrum listen to this. I interview Republicans and Democrats both for this pod. And I hope people listen to folks of the other letter behind their name, but whatever like letter you associate with, whatever party associated with, even whatever you believe about climate change and what is causing it, what is just a simple empirical matter is the temperatures are higher in the summertime. I don't think there's really any debate about what's causing that, but even if I were to grant that, like, you could debate what's causing that, what you can't debate is that 2011 was the hottest summer Texas ever had recorded. 2023 was the second hottest 2024. Seemed very cool if you lived in Texas because 2023 had just happened, but was actually the sixth hottest summer. Basically the average of any last 10 years is the hottest average last 10 years period. And so when you talk about a state where you have a lot of construction workers working outside during summer times where it's a hundred degrees every day and there are not required breaks, that's a big deal. I know you're background, having worked for Workers Defense Project, this issue is near and dear to your heart. I'm not going to ask you a specific question. I just want you to speak to the importance of having protections for workers in the heat and what you think those policies should look like, maybe what's in the American Energy Worker, or the American Energy Worker Opportunity Act, has more to do with oil and gas worker transition, but the federal heat rules, climate change mitigation, talk about any and all of that that you'd like to in the time we have left. Congressman Greg Casar On top of the key consumer issues around making sure you have power when it's hot or when it's cold, we also know that climate affects us with what we're doing most of our days, which is at work. And it is getting hotter and hotter. Heat is actually the biggest climate killer we've got, more than killing us in hurricanes or tornadoes or in floods people die because it's just so hot. And especially if they're working really difficult outdoor jobs, or even if they're in some of these warehouse jobs or work in the baggage belt at the airport where it gets really hot. And if workers aren't prepared or aren't able to take a break, then people get sick. that obviously hurts us economically. And it also obviously hurts our families. So needlessly. When people say, know, like, well, shouldn't employers already give workers a break? I've heard from far too many instances where that doesn't happen. On a construction job, when somebody's trying to hit a deadline before the next construction crew comes in, hey, we've got electrical coming in tomorrow. We need to wrap this up. Don't come off the scaffold for the next six hours. And somebody runs out of water in their water bottle. That's when somebody gets a stroke and dies. A postal worker here in Dallas just recently died getting pushed to wrap up his route. He'd been working for the postal service for decades. They're in these trucks without air conditioning. They're walking from door to door and that over 100 degree heat, dedicated public servants, church going member guy that everybody knew and loved in the community. know, Mr. Gates dropped down and died a federal employee. And so the Biden administration, totally preventable, the Biden administration put forward a proposed rule after lots of scientific study and support across a lot of business industries to say, look, when the temperature gets above 90 degrees, then people deserve a quick little break every couple of hours. And this is going to prevent deaths. And this kind of rule has been killed by oftentimes big industry lobbies, especially in big ag and in construction. But I pushed our own postal service, Postmaster General DeJoy recently, to implement this rule himself. This rule would have applied to him as well. And they said no. And so there's this resistance at the industry level that says, OK, we've got this handled. But clearly, it isn't actually being handled. And so here in the United States of America, we're hoping to finally win this basic right for workers. The rule has been proposed. And it could be finalized if the Trump administration chooses to finally put it into effect. The Biden administration has gone through all these hoops that were put in place essentially by Newt Gingrich back in the day to make it, know, he had to go through all these hoops to propose the rule, get it written up, get it vetted, and it just has to go into effect. And we'd love for it to go into effect in time for this summer and ready to work with anybody, with any letter behind their name to try to get that done. The American Energy Worker Opportunity Act, as you've noted, is a different topic. I led that bill, bicameral bill, between the House and the Senate. Senator Sherrod Brown carried that bill in the Senate and he tragically lost his race here in Ohio recently. But the vision behind that is that too often, talking about a just transition, workers on the ground, especially in places like the Gulf Coast, have heard those words and think they might be empty words. Or as I heard from one union leader in the fossil fuel industry that we just heard that that's a fancy funeral and we don't want that. We want to make sure that as we transition to cleaner energy, that fossil fuel workers are at the table and that we make sure that people are able to pay their mortgage and pay their rent and do their jobs. I can hold Exxon accountable for polluting our communities while still caring about the folks that work there. So I want to make sure that those workers transition into jobs that pay the same salary. that we actually recognize that part of the cost of transitioning to an economy that is cleaner and better for us in the immediate and the long term is also taking care of the workers that are just doing their jobs and have done their jobs honorably and power this country for a century. And so I want those fossil fuel workers to be taken care of. I want to make sure that if they are unemployed that we immediately move them over into equal paying clean energy jobs. want those jobs to be union jobs, just like so many of our fossil fuel jobs are. And so that bill really is, know, traditionally has been a bill that's been supported by the mine workers, has been supported by the utility workers, has been supported by the steel workers and the electric workers. Those, we need to make sure that those folks are a part of this conversation, because we aren't just telling people in fossil fuel, hey, sorry, you know, we've moved on. But no, actually, we're we're making this transition with you as the energy workforce. We're so grateful for those workers' contributions. We're not going to leave them out in the cold as we try to save the planet and save the country. Doug Lewin Yeah, I know you've got to go in a minute. I don't think, I just want to say this kind of in closing. I don't think people really realize this, even though drilling and production in the Permian Basin of Texas is up dramatically. actually produced more oil and gas in Texas 2024. Well, in the United States in 2024, then fueled by Texas, then in any country in the history of the world produced more than Saudi Arabia ever has. the the amount of workers in the industry is down 100,000 from 2014 when it was about 300,000 workers according to the Federal Reserve Bank of Dallas, down to about 200,000 workers now. So even with increased production, because there's so much automation, and this will be increasingly true as AI comes into production more and more, there's going to be more and more workers left looking around for what's next. And I think there are big opportunities in geothermal and nuclear, you know, lot of people talk about oil and gas to solar. doesn't make a lot of sense. That's like electricians, but geothermal is drilling, nuclear is a lot of fabrication. Like there are opportunities there. So I'm really glad you're working on that. And again, there's a theme here. Like I can't imagine anybody of any ideological stripe not caring about that. Who wouldn't want to see oil and gas workers that for whatever reason, whether it's automation or less drilling or whatever the reason, have a really good next opportunity. That seems like that would be pretty universal, right? Congressman Greg Casar Well, Sherrod Brown famously was able to continue to be reelected in Ohio in a state that overwhelmingly was voting for Donald Trump at the top of the ticket. so clearly this message of putting workers first moves that core group of voters that don't necessarily associate somebody just with having a D or R next to their name. They want somebody that's going to be fighting for them. And so I've made that pitch. across the island hopefully can continue to build out the group of people that are going to care about working people and the power coming on and the jobs being good more than just sort of the letter next to your name and whether you're on that team or not. Doug LewinCongressman, thanks for being on the Energy Capital Podcast. Is there anything that I didn't ask you that you wish that I would have anything you'd like to say in closing? Congressman Greg Casar No, that was great. Thank you so much for having me, Doug, and for keeping these issues top of mind for all of us. My real hope, yeah, is that here in the energy capital of the country and of the world, that we can wind up having a grid that is reliable when it gets real cold or real hot. Like you said, I grew up here in Texas, and I know it's hot, but not this hot, this early, this long at these temperatures, and also this cold. I mean, I remember when it just used to be a field day at school when there was like a little bit of snow that would melt on the ground. Now it feels like, you know, this is a regular thing that it's freezing over here. And so it's just, it's, got to be a real concern to us and we've got to work together on it. So thanks a lot, Doug Lewin Thank you Congressman. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.douglewin.com/subscribe

Rick Perry, the longest-serving governor of Texas and former U.S. Secretary of Energy, shares his impactful journey in shaping the state's energy landscape. He discusses the importance of an 'all-of-the-above' energy strategy, advocating for nuclear power and innovative technologies like Small Modular Reactors. Perry highlights the balance between government and free-market principles, emphasizes bipartisan opportunities for clean energy, and presents creative solutions for Texas' water challenges. He also champions plant-based medicines for veterans' mental health.

Mary Powell, CEO of Sunrun and a pioneering force in solar energy, discusses the rapid growth of solar and storage in Texas. She highlights how consumer-led initiatives are reshaping the energy landscape and fostering independence. Powell debunks myths surrounding energy storage and emphasizes the role of virtual power plants. The conversation also dives into Texas's rise as a leader in solar, showcasing community resilience and innovations that enhance energy sustainability and practicality for homeowners.