Transcript 0:01 I think we just have to, to get together and we're gonna have to... 0:05 We can't do another 15-year study thinking great thoughts and, and then the administration changes and then you have more people thinking great thoughts. 0:12 This has gotta be, we've gotta come to the table, and this is maybe I'm, I'm, uh, in a, uh, in a, in a fantasy tale or a fairy tale, uh, to think that people would come together on such a serious big project. 0:24 But you need the best minds in the world, and they need to come together, and they need to try to set aside their, uh, emotions and their personal investments. 0:37 You know, they're just, they're not bringing saints down from the sky untouched to do this. You know, everybody has, has an interest in one thing or another. 0:50 [rock music] Welcome back to The Peggy Smedley Show, your voice for our connected world, with your host, Peggy Smedley. Hello, listeners, and welcome back to The Peggy Smedley Show. I'm your host, Peggy Smedley. 1:04 My next guest specializes in energy and environmental law and policy. She represents clients throughout the United States and the world. 1:12 She was an adjunct professor at George Washington University Law School for more than 20 years, teaching some 60 students energy law while also co-authoring texts on energy law. 1:24 She was the first woman president of the Federal Energy Bar Association, as well as the first energy lawyer to be honored as one of the top 100 lawyers and top 50 women lawyers in Washington, DC by Super Lawyers. 1:40 Before being named to her current position, she served as the chairwoman of the association, a role she held since 2019. 1:48 Please welcome back Sheila Hollis, acting executive director at the United States Energy Association. Sheila, welcome back to the show. It's great to be back, Peggy. I really enjoy our conversation. 2:00 Well, Sheila, we left off the last time, I was, I was really enjoying this conversat- conversation. 2:05 We were talking about cyber, we were talking about CO2 emissions, and just everything that we really need to talk about from renewables to electrification, hydrocarbon. 2:16 Um, I, I think it, it's just a little bit of where we need to go with everything, and I think what's interesting to me right now is when I think about the grid, in my mind, I think people look at it like there's a grid and it's aging out, and they think, "Okay." 2:32 But it's much more than that. I think, you know, when we, we think about power outages in the home or whatever we think, I don't think we understand, we hear terms and we don't understand what all the terms mean. 2:43 You know, we maybe in the profession do, but I think sometimes the listeners don't understand what a grid is, what a p- a microgrid is, and the differences when it comes to security or what it means. 2:55 You know, an expert like yourself, walk us through why we need to understand that, how that impacts us as a society, and how you can't just turn a switch and it's on and it's off and we go, "Hey, you know, move on." 3:08 You know? There's, there's a whole- Yeah... lot of different things that happen that need to happen to make sure that we're all protected and that's w- you know, a- as we move on. 3:19 Well, uh, with respect to the grid, uh, there are microgrids which could be like a shopping, a small shopping center, uh, or, uh, it could be a whole, uh, home development area. 3:29 It could be a, a, a, uh, subdivision, uh, that would just be a, a, a modest size grid that would provide, and it would, you would have to have it built in the right places. 3:41 It would have to be in place in the right places with the right access to resources. Uh, in California, where there's a lot of sunshine, uh, you may, you may need, uh, it may work, work perfectly. 3:52 In other parts of the country, it's a little more complicated, uh, because of the weather situation, cloudiness, and so on and so forth. 3:59 So it, it all depends on where you are as to the magnitude of the small grids, microgrids, uh, that you can utilize. Uh, 4:07 they're, they're being used a lot in, in shopping centers and, and, and some, uh, developments, home developments and the like. Uh, with respect to the big grid, 4:18 the big grid that we have in this country is comprised of ma- of several parts. We've got Eastern Grid, we've got the, uh, Southern Grid, we've got, uh, and, and, uh, there's East to West. Uh, there is a breakline. 4:31 There is east and there is west. There's a, the grid does not... Power does not flow magically from hydropower in New York out to California when there's a dry spell. 4:40 Uh, it is, uh, the, you know, Western Grid, uh, up to about the middle of the country, and then the Eastern, uh, basically two, two parts. But in those, there are different grids. 4:53 There is the California Grid, uh, and the Western Grid, and then there is New York, uh, and on down through Mid-Atlantic, and then there's, uh, a central part, uh, that is the, uh, Eastern, 5:08 uh, Eastern Central, and then, uh, down into Florida. And, uh, uh, all these different forms of energy play into it. You've got hydropower coming in from Canada. 5:18 You've got massive amounts of hydropower in New York still. You've got nuclear pants- plants pumping away. 5:23 Uh, you've got, uh, gas pipelines, although they've been, uh, they've been squelched, new developments of gas pipelines in New York and all, uh, and other parts of, uh, the East and New England. 5:34 Uh, and you have a power from a variety of sources. Now, we're getting wind power from offshore. There, there, those big wind towers are, are being built, and they will supply some power. 5:46 Uh, and so that will, that'll be good. There's also a lot of solar panels being installed, big solar panel fields. Certainly in the West, very, very successful. 5:55 Uh, lots of ground, uh, lots of sunshine, uh, lots of good things can come of that.Uh, with respect to the, to the wind towers, they're also very successful. 6:05 If you look at North Dakota, uh, and, uh, parts of the country where there's a lot of wind and not a lot of people and a need to get transmission, uh, going, they can rely heavily on the transmission lines to move that power to, uh, parts of the country where it can be utilized and is really, really needed, and it's not C- CO2 emitting, of course. 6:25 So it's... There's a whole agglomeration of different forms of energy, different sort of sources of energy. I think it's... 6:32 Well, if you looked at the chart that, that the DoE, you know, or the Ed- Energy Information Service in the US government, EIA, In- Energy Information Agency, and this is all on the, on the federal government website, you can see that at this stage, uh, uh, of our development and in our transition, I'd say, uh, less than 25%, maybe 25% is coal. 6:54 It used to be much, much greater. I was looking at, uh, the history of one major utility in the Northeast. It, it used to be 80% coal. 7:01 Well, that's all, that's all come way, way down, and in s- many cases they have no, no coal-generated power coming into their system. Uh, a lot of it is hydro still. 7:10 A very significant amount, 11, 12% of our, of our s- uh, power comes from hydro still, but if there's a drought a la what there is in California, that's a big problem. 7:19 You have to replace, 'cause the hydropower isn't there, the water isn't there to generate hydropower. Uh, so that's, that's a whole other area, uh, that needs discussion, because we have had some pretty severe droughts. 7:31 It looks like that is shaping up in California again. Um, and I've worked very extensively on hydropower in California, and, uh, they... It's very, very interesting. 7:39 If you get a dam relicensed out there, it's not an easy task either because of, uh, oh, concerns of, uh, of, uh, damage to wildlife, uh, in particular fishing rights, indigenous people's rights, uh, with respect to the water and, and so on. 7:55 There's a whole long history to the big hydropower s- uh, p- plants in this country, which would deserve at least an hour lecture. 8:02 Uh, but, so with respect to the grid, it, it, it's the areas of the country that depend on, on, uh, natural gas-fired power, frankly, uh, a lot of natural gas-fired power, but also other forms of power, 8:16 uh, they can come in, all those sources of power can come in, uh, and be brought onto the grid and provide a... We have the, the blessing in this country of actually having a mix of sources of energy. 8:28 Let's say 25%, uh, coal still, maybe a little less. Uh, a very significant amount, significantly more, I'd say maybe 30%, um, I'd say natural gas at the moment. 8:39 Uh, I would say, uh, with respect to nuclear, it's probably about 20, 25%. That's shrinking because the closure of the nuclear plants because of aging out and the relicensing process, and also there's some opposition. 8:52 A lot of opposition still. There's an e- very strong anti-nuclear sentiment in many communities where the facilities were built. 8:59 And so, uh, you know, if they, that, that is not, uh, able to be overcome by demonstrating the safety and the reliability of the plants, uh, it, they, they, they too will wind down, and that's... 9:09 Replacing that massive amount of nuclear power is, is gonna be a challenge. Uh, and then we have, uh, a lot of, um, of renewables, depending on the part of the country, depending on the part of the country. 9:21 Certainly California, very, very heavy, uh, in, in investment in, in, uh, renewables and, uh, solar panel support, uh, wind and the like. 9:31 And, uh, it, you know, it depends on what part of the country you're in and then getting the power on the grid and determining where that power should go. 9:39 Uh, now all of that is agreed to, uh, pursuant to FERC tariffs, uh, the Federal Energy Regulatory Commission, which is, uh, one of those agencies that, uh, unless you're, uh, an energy geek like me, uh, and those who are associated with the energy geeks, there's no escape from us babbling on about it. 9:57 But the Federal Energy Regulatory Commission is an incredibly important decision maker in this process, as are the state regulatory commissions, uh, and I cannot emphasize that enough. 10:08 Uh, FERC has tremendous, uh, authority first to rule on cases, but also develop, to, to develop rulings, to develop policies that can be applied nationwide. And so, w- but how, how political are they? 10:23 Well, there's five commissioners at the FERC, and they're appointed by the president. But just because the president changes, they don't all five change out. In that way, you could analogize it to the Supreme Court. 10:34 They serve a term, although with the Supreme Court it's lifetime, but, uh, at the f- at FERC, they serve a term of a certain number of years, five years, which can be renewed. 10:43 If they're, they're, uh, if they're beloved and everybody wants them to stay around, then they could be renewed and stay on, uh, longer. Uh, and so it's, it's both parties, uh, are represented on the, on the commission. 10:55 Uh, and, uh, you know, they change every few years, and there are wonderful people on the commission, and they try real hard, and it's a collaborative process. They have enormous amounts of input. 11:05 If, if you want to, uh, have a reading assignment, I'd, uh, just look into a FERC docket, see the, the massive number of briefs that come in, the studies. Uh, it's mind-blowing. 11:15 And so to- FERC has to have a very, very, uh, 11:19 uh, strong and, and complex and dedicated, uh, professional staff to make all this happen, to get the, the study done and set up the hearings, the technical conferences, uh, all the writing of these orders. 11:34 These orders can be 100, 100 pages long. Are they the ones- Very complex, detailed stuff. Sorry to interrupt. Are they the ones that influence the march to decarbonization that we've been talking about for 2050? 11:46 Are they part of that big mission for that? Well, that's a very interesting question. 11:51 I think that-No, no matter where you go, you're gonna find m- most, uh, most regulatory commissions would say, "Yes, we wanna decarbonize," but it all boils down to a matter of degree. 12:01 How fast and how are we gonna manage the necessity to keep the lights on? Uh, how are we gonna keep manufacturing going and the like? 12:09 And so you have to have a, the vision thing where you see, okay, now this is gonna be replaced here, this is gonna be replaced there. 12:15 They're relying on the grids to, because the grids are regulated as just directly regulated by the FERC. 12:21 They're relying on the utilities that are regulated by the FERC, and other entities that have to come before the commission to get permission to do things or to get rates, uh, increased, or to take into account some, uh, unique circumstances that they're, that they're in, which are subject to regulation under the Federal Power Act or the Natural Gas Act, uh, and the like. 12:42 And then, uh, also FERC is a part, it's connected by a dotted line, but it's still connected to the Department of Energy. 12:49 So the Department of Energy oversees, in a sense, the policy of the FERC, semicolon, but the, uh, at the FERC, there are five commissioners, and it, it, they're not all one party. So i- it's, it's very, very complex. 13:05 And really, the complexity of the FERC/DOE relationship and the input from other agencies, let's say Department of Interior, uh, maybe the Navy, uh, uh, with respect to building an LNG plant and the authorizing of an LNG plant, LNG export now. 13:21 We used to be begging for, for natural gas. We were down on our hands and knees begging for imports of oil and gas in the '70s, uh, through importation had to be approved. Sure. But now it's exportation. 13:31 We're in a much better position. So now I- When I first came to... Yeah, sorry. I'm, I'm sorry. I gotta ask this question only because we've only got a few more minutes, but I've... Okay. 13:38 Then how did the war in Ukraine impact domestic energy and consumer prices? 'Cause now you're saying all of this, uh, that leads me to ask that very question. Well, let's back up. Let's, let's look at it. Where was... 13:51 Uh, it was a sort of a, a little bit happier family over there, uh, and, uh, Russian gas was gonna flow to a lot of parts. I don't think Ukra- Ukraine was involved because Ukraine had gone in a different direction. 14:02 But other parts of Europe were going to buy, uh, off a, uh, off the Russian, the huge Russian gas pipeline, multi-billion dollars been built, building out for years. 14:13 They were going to utilize that gas to meet their energy needs because they had this, they're trying to switch from coal, or their nuclear plants may have shut down. Like in Germany, they shut... 14:21 You know, when they, when, when Fukushima occurred, then all of the Germans reacted by shutting down a- almost all of their nuclear. So the Germans had to get gas from somewhere. 14:32 They had to run their systems fr- uh, from s- off something, and so natural gas was going to be a panacea until they reached the, you know, the nirvana of not having any su- CO2 emissions by magic or however, I don't know. 14:44 But they, in the meantime, they needed something to run their energy systems, and it, and it was natural gas. So, and it was from Russia. Okay. 14:53 So w- so let's say the Russian gas is cut off, or it's cut off in a lot of parts. Okay. So where's the gas coming from? That's the United States, LNG exports. And the LNG export business has grown tremendously. 15:06 And it, it's one of those things you thought you'd never see the day, you know, back in the '70s when you were, we were importing, so desperately importing LNG from any place we could get it. That included Russia. 15:16 Yeah, we imported LNG from Russia. We imported LNG from, uh, other parts of the world. And so there you go. I mean, it's, it's just, uh, apple pie turnover stuff all the time [laughs] you know? 15:27 It's, it's just, uh, the changes in the politics, the changes in the, the war setting of the world changes everything. We look at during the Iraq crisis when we were out of oil, and we had a desperate oil shortage. 15:40 I see, Peggy, I see this problem where we can't, we don't have the, a light switch where we can turn on and off sources of energy. 15:46 You can't have people go out and drill for massive amounts of natural gas and oil and then, then have 'em treated as the bad boys when things change a little bit and they're not needed as desperately. 15:56 You, once you say, "We need domestic supply," and, and the investment goes into the ground, and it's not, you know, [laughs] it's not $10,000, it's not one million dollars. 16:05 Many times it's billions of dollars in investment, in infrastructure, and the pipelines associated with it and all that, and the, going all the way up into the distribution systems, you know? 16:14 Gas, if gas is gonna be verboten and you have to turn off all the gas, you're gonna have to find the energy from someplace, so then you're gonna install all sorts of other things. 16:22 And anyway, so, uh, you see the complexities of it. If it, it's not, this is not nickel and dime stuff. This is, this is not billion dollar stuff. 16:30 In many cases it's trillion dollar investments that are, they're going to have to be made. I think we just have to, to get together, and we're gonna have to... 16:37 We can't do another 15-year study thinking great thoughts and, and, and then the administration changes, and then you have more people cr- thinking great thoughts. 16:45 This has gotta be, we've gotta come to the table, and this is maybe I'm, I'm, uh, in a, uh, in a, in a fantasy tale or a fairy tale, uh, to think that people could come together on such a serious, big project. 16:57 But you need the best minds in the world, and they need to come together, and they need to try to set aside their, uh, emotions and their personal investments. 17:09 You know, none of this, they're not bringing saints down from the sky untouched to do this. 17:14 You know, everybody has, has an interest in one thing or another, and the, and their, the entity that rep- they represent has an interest. But, uh, I think the need for energy is as clear to me, uh, clear as a bell. 17:28 It's a question of how can we 17:31 deal with our need for energy in a way which takes serious account of climatological impacts of those choices and reduces the climatological impact b- by as much as possible while realizing that we need these, we need these sources of energy. 17:50 Uh, you know, things that you don't even think about. What, how much concrete, how much concrete depends on natural gas? How much aluminum depends on natural gas? 17:58 It's hard to, to, to make this c- stuff come out of thin air. We wanna continue to grow and develop, and we're going to have a population increase probably, uh, in many parts of the country. 18:08 And, uh, you know, we, we need to be ready to serve those needs. Plus an increasing demand on the grid from other demands. 18:15 If we wanna continue to manufacture, if we wanna continue to make things in this country, then those are things that, that we have to think about. We have, we don't want to be dependent on others. 18:24 We don't want to have to go back hat in hand and ask for, uh, imports from other countries which may or may not be our closest or long-term friends in the world. Uh, that's, that's not ideal. 18:36 Sheila Hollis, acting executive director of the United States Energy Association. This has been an amazing conversation. What is your URL for our listeners to get more information on what you're doing? 18:46 You can get basically an encyclopedia of knowledge at the, at the United States Energy Association. So just look to USEA. You'll see so many resources. 18:55 Uh, you know, you could write a PhD probably off the, uh, thesis off, off looking at a year of our programs. Sheila, thank you so much again. I appreciate it. 19:05 Well, it's a pleasure being with you, Peggy, and I wish you nothing but good luck, and I'm so glad you're out there representing women so beautifully. Thank you. 19:12 Okay, listeners, that's all the time we have for the show today. Make sure to share and subscribe to our episodes each week. As always, you can share your thoughts with me on Twitter, follow us at Connected World. 19:20 And remember, we broadcast every Tuesday, 12:00 PM Central. Check out our website at connectedworld.com, our show website at thepeggySmedleyShow.com. 19:28 And don't forget to tune into Project Sustainability podcast at pspgreen.libsyn.com. All right. This is The Peggy Smedley Show, your voice for our connected world. 19:37 And remember, with great technology comes great responsibility. [upbeat music]
