Jigar Shah
Appearances
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And so they're saying, not only do we not trust the technology because Thacker Pass is using next generation novel technology that is far more environmentally friendly than what they do domestically. in China, but we also don't like this volatility. So there was no place for them to go to get debt.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
But when you talk to the big mining companies, they were like, well, we don't want to buy these guys. We don't want to use next generation technology. We want to use technology that's already been used for 10 years in the field.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And so the loan programs office was the only place where we could actually look at the forward price curve for lithium and look at supply and demand and figure out where is this going to go from, you know, we had third party providers that helped us with this. And how likely is this technology to work? Oh, very likely because we've actually been piloting it for over 10 years.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Okay, fantastic, right? And so the only place for them to get a fair hearing was going to be the loan programs office.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Well, look, I think that right now there are so many companies who are deserving of an LPL loan. They have done their homework. They have made sure that they're meeting our threshold, which is that reasonable prospect of repayment, that we don't have to lose money, right? That the companies that come in are just so overprepared and so amazing that we're able to make smart choices.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I think there were two big challenges with Solyndra, and both...
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
things we don't do anymore the first is that the loan programs office put our money in first before the private sector folks put their money in and that never happens now and so we make the private sector money put their money in first and then we match it with our debt second and so that makes sure that the project actually has enough money to be completed
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
The second is that Solyndra had real technology risk. And we don't take real technology risk anymore at the loan programs office. If we think there's real technology risk, we have our partners at the Department of Energy demonstration programs give them a grant to demonstrate their technology first. And so those two things we do not do anymore at the loan programs office. So we learned our lesson.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
We got a bunch of unsolicited advice and we followed it, which is great. In terms of the way that LPO should work and does work today, we estimate what our chances of losing money on every loan is. We reserve that amount of money into an account, right, which is held by the U.S. Treasury. Every year, we estimate whether... That loan has gone up in risk or down in risk. The goal is to be accurate.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
The goal is not to over-allocate money for losses and then not need it, right? Because that's sort of just money that could have been used to help other people. And I think we're really good at that today. In terms of the lesson learned, look, I would suggest to you that today... Both Republicans and Democrats have never been more bullish on America's ability to do big things.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
When you look at just how aggressive Governor Lee is in Tennessee around pushing for nuclear supply chain and more nuclear plants, it's amazing. Or Governor Kemp in Georgia and all the wonderful stuff that's happening there, right?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Governors around the country recognize that this is something that is essential to take their best and brightest people that have decided to, you know, scale up a company in their state. This is the tool that they need. And it is so prudent because it doesn't really cost the federal government much compared to amount of loan authority and how much economic development it spurs.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Well, remember, it really is only an industrial strategy bill. It is not the rest of those things, right? The rest of those things are things that incentivize the private sector to do things.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Maybe, but look, I think that what matters is that these projects succeed. If we build a manufacturing facility and that manufacturing facility fails, well, then all the benefits that it provides to workers or to communities or other things go away, right? And so the central tenant to all of this has to be that these projects succeed, right?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I mean, that's how it provides the benefits to all of the other folks. And so that has to be the thing that is the thing that we're most focused on is that is this company going to succeed? Are the products that it's making in demand? Is the expertise required to stay ahead of its competitors something that DOE is working on? And so I would suggest to you that that has been the central tenet.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And when you think about the loan programs office's approach, our approach and our due diligence has been the golden ticket for all the companies that have gotten conditional commitments, every one of them to date. And what we've told people is... You have to make sure that labor is not something that is going to make your project fail.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Like, you need to hire people who are experts at their craft. You need to make sure that those people do the job right the first time. And people have done that because it has de-risked their project. And we've said, hey, it's great for you to talk to the community. We're not giving them a veto.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
But we are saying that, like, if you don't have a good relationship with the community, we're not really sure how you're going to get the, you know, changes to your permit that you're going to need in five years or the expansion plans you want to do in five years, etc. So, like... You should talk to them. And when it's been scary, we've facilitated the conversation.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Yeah, it's a good question, right? I think we all first have to acknowledge where we were as a country when President Biden came into office, right? America was really doubting itself and doubting its ability to do these big things. Most investors were saying to their CEOs, I know you want to do things in America, but that's just too risky.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
So now we had to go to these CEOs and say, how do we arm you with the information that you need to convince your investors that this is the place that we can do business? And along the way, people are like, well... You know, I don't want to have a great track record on megaprojects here in the United States. A lot of projects are over budget and take longer.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And so we had to say, well, what are the best practices on megaprojects? Oh, you should be spending 10% of your entire budget up front on planning before you start construction, right? Oh, you should have higher quality workforce, right? And all these things. And so a lot of the companies were like... wait, this isn't free money? This is not a grant? And I was like, no, it's not a grant.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And even if we were to give you a grant, which the Loan Programs Office doesn't do, we still want you to succeed. We don't want to just give you money and then have you fail and then for Chinese companies to buy all of your IP in bankruptcy.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Which is it? Too much process? Or is Jigar like pushing money out the door too fast? I think that when you do these billion dollar projects, there has to be a level of sobriety around how hard it is to do these things. And I think that a lot of the people that came into the loan programs office did not have that level of sobriety.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Now, it's not my job to, like, impose that on them, but it is my job to make them actually go through the checklist. And remember, if they thought that they could get private sector capital, they should. It is not the loan program's office's job to compete with the private sector.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
So the only reason that they're going through the loan programs office is because they can't get a loan from the private sector, right? And so let's be clear about the risk profile that the loan programs office is expecting to take on, right? And so we want to make sure these things are successful.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Now, what I would suggest to you is that the amount of time it took to get people through the loan programs office in 2021 was a lot longer than today. Today, there are some people who come into loan programs office and are leaving with a conditional commitment within seven months. And so it is a lot faster. Why? Because they're amazingly better prepared.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
They listened to some of the guidance that we've given people. They're like, oh, we can't just phone this in. We have to do real homework. Oh, okay. I guess we'll do that work. And now things are moving much faster than the loan programs office.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I'm not going to apologize for the fact that we've taught American entrepreneurs, innovators, and investors how to do big things, and they're finally listening and figuring out how to do that.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Well, to be clear, right, there were no requirements. I mean, the requirements for the loan program's office is you have to pay Davis-Bacon wages during construction, and you've got to, you know, meet some of the other statutory requirements around the Cargo Preference Act and some of that stuff, right? And so our projects were not required to use union. What we said to people is show us
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
That the people that you're hiring actually have experience on building what you are building. And it turned out that most of those were union contractors, right? We also, by the way, like if you talk to the unions, like they didn't love me either because I was like, what? where's your marketing materials? Like, what are you doing to like promote the fact that you're reducing risk, right?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
You know, we had a lot of tough conversations with the unions and I think the unions are more competitive today than they were four years ago around how they win business because we held them accountable too, right? And so, you know, this is not something where this was a requirement. This is something where we said, okay, we have low unemployment rates, right?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
This project is going to fail if the people you hire are not people who can actually do the skilled work that you are suggesting that you need in the loan application to loan programs office. So this is a source of risk for us, right? On the community side, I'd say,
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Well, when you look at Trump's first term, the clean energy industry really found its own during Trump won, right? And so, you know, my sense is that the deployment of clean technology is going to keep going. I think the real question is around what our leadership looks like around the world. And even there, I would say that people are continuing to clamor
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
A lot of the times our companies were led by extraordinary CEOs who were not focused on communities, not because they're bad people, but because they're focused on their technology succeeding. So they would outsource this work to their head of HR. But the head of HR would be like, well, let's put in a playground. And I was like, seriously, that's what you think the community needs?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And so we would hold a listening session with the community and say, what do you need? And we would make the CEO and CFO come there. And it was clear that they had never met the community leaders before. They had outsourced this to the HR people.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And when they met the community leaders, the community leaders were like, we have all these people in this neighborhood that are extremely impoverished that want to work at your factory, but there's no public transportation to get there. Would you put in a bus service to do that? And the CEO was like, hell yeah, of course we would do that. Why is this the first time I'm hearing about this?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And then we looked at the HR person and say, why didn't you bring that idea to them? And so we facilitated the conversation. We didn't mandate anything. But once the CEOs and CFOs heard the request, they were like, these are eminently reasonable, and this reduces the risk of running my... facility. Like, look, I get where Ezra's coming from.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And it was like, I think it was like some article he wrote about a homeless shelter in San Francisco or something. But when you think about what we're doing here, these are infrastructure projects that have to last for decades, decades and decades and decades. I just think that the notion that you would do all this stuff without being thoughtful is ridiculous.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I mean, I don't know. Like, do you think that if you're going to make a multi-decade commitment to a community that you should like have the CEO and CFO actually meet the community once before like you sign on the dotted line? I don't know that this is a requirement here. I think we're talking about best practices.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I think today, American entrepreneurs and innovators are more prepared to do big things in our country today, and their investors are more prepared than they ever have been, right? This has never been about the loan programs office. And I love the fact that we're being told on the one hand that we're rushing money out the door, and on the other hand, we're being told we're being too thoughtful.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
But this has been about applicants. We have an absolute threshold that Congress reconfirmed in the 2020 Bipartisan Energy Act that passed saying you have to make these applicants meet this threshold, right? And so we have been working to get everyone to meet that threshold. Now, we can do a lot of mentorship, but we can't drop our standards. We can't cut corners. We can't do any of those things.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I think today— People are more prepared and people are more sober about what it takes to do big things than they ever have been. And as a result, I'm very proud of every loan that we've made. I think that they are going to be pretty successful. But more importantly, I'm really proud of what they're catalyzing.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
It took about 15 years from our first loans and the utilities signing their first power purchase agreements with these solar farms for there to be full market acceptance of solar within the big money centers from pension funds to others, right? I think we can cut that in half. I think we can do that in seven and a half years.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And, you know, for all of the executive salaries that we're burning by asking tough questions, I think if we cut their time to trillion-dollar scale in half... That makes their companies more likely to become hugely successful and profitable. But it also means that the climate benefits faster from that scale. And so I'm proud of the formula that we put in place.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
for American technology in geothermal, in nuclear, in, you know, some of these other areas. And so, you know, I think that the pace may change a little bit and there's always ups and downs, but clean technology companies are crushing it right now.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And I really think that it's going to last the test of time, regardless of the president, regardless of administrations. I think this is something that American innovators and entrepreneurs recognize that they have to do if they want to be successful.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Look, I think that these are superior cars, right? Let's be crystal clear, right? If you want a performance car at an affordable price, that's an EV, right? And so I think we entered office with maybe, what, like 500,000 vehicles or so sold in 2020. And today, I think we're four to five X above that number. So it's been a remarkable period of growth. over the last four years.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I think that today we are now at escape velocity on EVs, and people now believe that it's only a matter of time before this happens. I mean, both my in-laws and my parents just bought a plug-in hybrid, and they never drive over 34 miles a day, and so they are basically fully electric, and they love it. And I think that when you think about where American innovation is headed right now,
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I think we're on track to meeting the goal of 50% EV sales by 2030 with EVs that were plug-in hybrid vehicles.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Yeah, so I think that we're not done yet, but I'd say that, you know, we've got battery manufacturing, right? And now you've got the 30D tax credit. And so the 30D tax credit says, buy your components to make those batteries from the United States, right? And so lithium processing, graphite processing, nickel manganese.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
When you think about the battery manufacturing facilities that we're building now, all of them have already been future-proofed so that when those next generation technologies come in, they can immediately be inserted into the existing manufacturing process.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
That's a complicated question, right? I think that we just talked about all of the technology breakthroughs that we have in our pipeline that we're not going to be sharing with China this time around and that we're going to be manufacturing and deploying here. China has hit that price point by bankrupting their lithium. suppliers, right?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And so every lithium supplier in China is losing money and they have started shutting in capacity. So like, do I love the fact that the cost of batteries are lower? Yes, of course I do. But do I love the fact that everyone in their supply chain is losing money right now? Not really. It doesn't make me feel like this is a very stable supply chain that is going to be able to be
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
trusted to build our next generation grid on top of, right? And so I think it's important for us to recognize that when we think about diversification, we think about national security, we think about global competitiveness, but we also think about like figuring out how to make sure we have stable companies that can actually like participate in the private markets, raise capital,
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Yeah, absolutely. Maybe. But in some cases, I would say, no, we need to make sure that these are stable companies that can provide the maintenance, provide the warranties, provide all these things so that we can actually build our entire modern energy infrastructure on top of it.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Well, look, I think that if you remove any of those policy supports, the question is, what do you replace it with? Right. And so you replace it with tariffs. You can replace it with other things. Now, that is a recipe for making things more expensive, not less expensive. But those are all policy choices. People can make those policy choices.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
But in the end, if these companies go bankrupt, what happened last time is that those technologies made their way to China. And so I hope that that doesn't happen this time around.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I hope that people recognize that these are American technologies, that we invented them, and that we now need to make sure that they are supported so that we can actually make sure they flourish here in the United States, and then we can export them around the world. That has been the industrial backbone of the United States for decades. But I think that if the policy support starts to fracture—
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Well, then, you know, these companies may end up being companies who are on the chopping block and those technologies will go to the highest bidder.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Remember that autos is one of the largest parts of our economy. I mean, it is not surprising to me that people do not want the big three automakers to go bankrupt. that they want to make sure that they can make this transition in a way that makes sense for workers, for supply chains, for all of those people who are employed in those industries, right?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Yeah, look, I think that when you think about what we've done to produce a modern lifestyle, we have burned things for hundreds of years, whether it was wood and then coal and then, you know, oil and natural gas. We have burned our way to a modern lifestyle. And I think... You know, then you had the Environmental Protection Agency, and folks said, we don't want to live in smog anymore.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And so we have the best technology in the world. Our automakers have the ability to make this pivot, but they're going to need a little time. And so we need to make sure that in these really important industries that we're not outsourcing all of it to other countries, that some of it is, a big part of it is being done here, and that includes steel manufacturing, aluminum manufacturing.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I think it's important to our national security for them to be very domestic.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I'm saying that if you think about what it's gonna take to decarbonize our grid by 2035, which is what President Biden has outlined, and our economy by 2050, you have to bring the American people along with you. And for them, importing every single thing we deploy here in the United States isn't gonna work. That's just not going to work.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And so we have to make sure that this is something that everyone is cheering about. And we can, because we have the best technology in the world. We haven't tried to do big things in these particular sectors in a long time, but we're doing them now. And I'm pretty sure that when we come back and talk about this in 2030 or 2031, everyone is going to be looking at themselves going, okay,
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Yeah, we were a lot better than we gave ourselves credit for.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Well, I think we should start by saying that the Department of Energy has approved so many new energy efficiency measures that we're going to continue to have energy efficiency for as far as the eye can see. And I think that's going to play a major role in meeting load growth right now. But the bigger part of load growth is not AI data centers.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
You know, I think people want to blame data centers, and data centers are important, but a lot of people want to store their photos forever of their children, right? And so they pay the extra $2.99 a month to do that stuff. And make no mistake, most of the load growth in the data center side is still cloud-based. AI is coming, but it's not yet the dominant thing that's going in.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Most of it is light manufacturing, heavy manufacturing, EV and, you know, heat pumps and all sorts of other stuff. Right. And so we have multiple solutions to load growth. But I think it's important to recognize that we have just had so much winning.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And we developed a whole new set of technologies coming out of the 1970s. And today, these technologies are truly superior in many ways. So when you think about what is driving people, it is superior solutions that help solve other problems. It's not climate.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Like so many people have chosen the United States as their place to commercialize their technology and not just American innovators and entrepreneurs, Japanese and Korean innovators and entrepreneurs, European innovators and entrepreneurs. Everyone is choosing America to scale up their technology. And that is awesome. And that's where the load growth is coming from.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Well, I think we have to take one step back. I think there's a recognition by all the hyperscale data center companies that their power demand is uniquely harmful to the cost of electricity. And so I think there is a recognition by the hyperscale data center companies that they do not want to pass the costs of their data centers on to poor people like, you know, was happening in the past.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Not that they were wanting to do that, but the utilities sort of offered them an industrial rate. And so there is an awakening by the hyperscale data center companies and the governors and the public service commissions and the utilities to say, okay, hey, wait a second, if these guys are going to cost so much to serve, we should make them pay full freight.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And it turns out that after Microsoft, Google, and Nucor did this massive request for information and they got, and they went through them all, that nuclear was one of the cheapest options that they could pursue to not pass costs on to the rest of the ratepayers.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Well, look, I think today when you look at how much new capacity we need to build, people are saying we need everything. There is no way for us to meet this just with solar, wind and battery storage. And we will do as much solar, wind and battery storage as we can. And we will still need nuclear and enhanced geothermal and other technologies.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
But more importantly, I think the Department of Energy has done tons of modeling work, and it shows if you can maintain that 20% nuclear that we've had for many years... it is so much cheaper to run a decarbonized grid with all that nuclear. And so people are now starting to recognize that instead of thinking just about levelized costs of energy, you have to think about the entire system cost.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
That also includes deploying technologies that we invented 20 years ago around grid modernization and dynamic line ratings and topology mapping and all the things that we need to do to get 50% more capacity out of the grid that we already paid for.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
It also means that all of these smart appliances that we've had for three or four years now, where even my humidifier comes with an app on it, you can use that to connect it to demand flexibility programs, and you can give people a 20% discount on their bill to allow their demand to be more flexible. So your water heater doesn't have to heat up that water right after you finish your shower.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
It can wait until electricity is cheap, right? And that also allows us to make more of what we've already paid for. And so I think where we are now is people didn't have to think differently for the last 20 years. Today, they have to think differently. If they don't, then we're not going to be able to have all this economic growth.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I don't think that American innovators and entrepreneurs have a political party. They want to take their technology, they want to work with their venture capitalists, their private equity firms, their growth capital companies, and they want to build big things. And I don't think any politician wants to send American companies packing and saying, sorry, we don't want you to scale up stuff here.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Because let's make no mistake, American innovators and entrepreneurs are an unstoppable force. You cannot say no to them. If you say no to them, they will go to another country and scale up their technologies there. They will not be stopped around their ambition. That's why we love them so much. They walk through walls, right? It is an extraordinary thing to see.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And I can't imagine any politician not wanting American entrepreneurs and innovators to win.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Look, I mean, I don't think people love the tweets. I don't think people love a lot of the rhetoric that's coming out of people's social media right now. But I think that they're working hard to do big things in this country. And they are going to play it out. They're going to work with governors. They're going to work with all of their champions.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And they're going to try to make sure that the policy here in the United States continues to allow them to raise equity. Because remember, we're private sector-led, government-enabled. And so the private sector still has to write that big check to build that facility in Nebraska or in Kansas or in Georgia or in Tennessee or in Kentucky.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And if they don't write that big check, then they're going to have to go to Plan B and Plan C. And so I just think that in general, these people are very practical people. They just want their technologies to be scaled up.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I don't know. I mean, look, I think that we are making commitments on behalf of the US government. When the government makes commitments to an outside party, that outside party expects the government to honor those commitments, right? I think in the past, all commitments have been honored. I expect in the future. all commitments will be honored, right?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I mean, this is the whole point of trust, right? And so if you're worried that after you get a loan commitment, that that commitment is not real, well, then why would you subject yourself to the process of getting a loan? If the government doesn't keep its promises, then it makes all applicants suffer, whether they're in the preferred sector or the not preferred sector.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Well, I think of course it's all of it. If you talk to entrepreneurs like me and others, we are driven by solving problems for people. We were not driven by regulatory arbitrage or by figuring out how to mine tax credits within the Inflation Reduction Act. We're driven by the fact that we believe that these solutions are superior to what they're replacing.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
So I can't imagine for a second that people of any stripe, want to hold back American innovators and entrepreneurs. They're going to fail. They're going to succeed. And frankly, we did not get a lot of blowback for the other loans that were done in a different way, like when they failed. So we're going to have a lot more failures. That is why the government is supposed to lean in.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
But we're going to have so many successes. And I just think that that is something that we are so proud of, not just within the Biden administration, But the entire American public, they love bragging about how awesome we are at inventing new stuff. And pretty soon they're going to be bragging about how we've all scaled it up here.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
So let me say this a different way. We have unprecedented load growth in the United States right now. The tools that got us here are not going to be able to solve this problem in front of us.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
If we don't scale up new nuclear, if we don't figure out enhanced geothermal, if we don't figure out grid modernization, if we don't figure out virtual power plants, then we will not meet this moment and we will have to sacrifice economic growth. I do not think that anyone wants us to lose the AI race.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I don't think anyone wants us to lose these manufacturing plants because we cannot interconnect them. And before you say, don't worry, we're going to do it with natural gas, you build as much of that as possible. It's not enough. And building new natural gas pipelines to all those plants is not an insurmountable hurdle. And so we're going to need all these technologies to succeed.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
We need it to be able to meet this moment. And I just think that I can't even fathom that any president would say, I'd rather us not grow economically.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
There will be an LPO next year. There will be an LPO. And we have 212 active loan applications seeking $324 billion. And my advice to the next LPO director is enjoy this extraordinary team that we were able to build. Enjoy the amazing people who have decided to interrupt their careers and move it here to the loan programs office and to the Department of Energy.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And dream big, do big, figure out how to help these American innovators and entrepreneurs realize their dreams.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And yes, those climate objectives helped pass the laws necessary to make the first-of-a-kind projects happen. So, look, it's all part of a whole, right? But I want to make sure that we're crystal clear about... And I think the president has been quite clear about this having to relate to jobs and everyday lives.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Oh, my goodness. I was supposed to be prepared for this. Well, you know, the book that has forever changed my life is Nassim Nicholas Tlaib's book, Fooled by Randomness. I read it before I started SunEdison a long time ago, and it reminds me today that all the things that people take credit for A lot of it was luck, and it's important to figure out luck versus what you actually did.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
The second book would be What If We Get It Right by Ayanna Elizabeth Johnson, and she is such an inspiring person. I've had the pleasure to know her for years, and she's really attracted many of the brightest minds in the climate movement to really think through what this looks like and how this can be really a positive world that we're going into.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Because I really do think that getting this right is going to be an amazing future for all of us. And then the last book was, I recently read Romney, A Reckoning by, I think, McKay Coppins.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And I think that when you think about his journey, right, and the journey of many folks who just want to do right by people, who just want to make this place the best version of what America can be, I just think it's super inspiring.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And the secretary has been very clear about the fact that this has to make people's lives better. And I do think it makes people's lives better. And that's what entrepreneurs thrive on, right? It's like, you know, Elon Musk wants a car that goes zero to 60 in like 1.9 seconds. And he created that car and people want that car. And that's awesome.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
So in 2005, Senator Pete Domenici and others said, hey, why do we invent everything here in the United States, but then send our awesome technology overseas? And people realized, well, when you look at the industrial strategy of Germany or Canada or China or other places, they actually support the commercialization of those technologies. And so the loan programs office was born.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
We're basically a bank within the U.S. Department of Energy. And it is supposed to take that risk of building that first project. When commercial banks are not comfortable with putting the loan out the door for that first project, because remember, these projects don't have venture capital-like returns.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
You can't put in a billion dollars of venture capital into something and get a 10x return on that. These are infrastructure projects that generate... 10% returns. And so you need to have low-cost affordable debt, but you also need to recognize that most of these banks do not have the expertise to evaluate the technology that people are bringing to them.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Whereas Department of Energy has 10,000 plus scientists, experts, and engineers on the platform, many of whom invented the technologies And probably provided some of the money for demonstrations, etc. And so the loan programs office operates like a commercial bank, but has this mandate to lose money to make sure that we are commercializing technologies here in the United States.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And oh, along the way, we haven't actually lost money. We've made money for the federal government.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Well, remember, I think starting in around 2018, there were huge funds that were created to support the next generation of climate companies. And then that number continued to expand exponentially, right, in 2019, 2020, 2021. And there were thousands of companies that got investment from the private sector. And so part of, I think, what
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
the Biden administration realized was that we had this moment again where those companies could either build things here in the United States or they could go overseas. And a lot of those companies were starting to become ready to commercialize here. And I think that at the core of this, there was a recognition that these projects were going to be big.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
So when you think about, for instance, the three biggest automakers and the battery manufacturing plants that they're building, each one of those plants were multi-billion dollar endeavors. And so I think it was very clear by the time we got into 2022 and the legislative session that the loan programs office needed to be beefed up. And so
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
We were seeing so much interest in using the loan programs office. And there were tons of libertarian folks who were like, wait a second, I don't think I'm going to be able to get this company to scale and exit unless we figure out a beefed up loan programs office.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Yeah, I mean, so the identities of the actual loan applicants are confidential, but I can maybe talk about it from a sector perspective.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Yeah, I can certainly do that. I think, so there's some broad categories, right? Clearly, battery manufacturing has been a huge highlight of our industry. four years in office. And so you've got 400 gigawatt hours worth of battery manufacturing. But then you've got critical minerals production facilities here in the United States that are going to feed those battery manufacturing facilities.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And remember, auto companies are some of the most sophisticated companies in the world from a supply chain standpoint. They have to buy stuff from many, many countries and assemble it all into one place. And so they're also very nervous about 90% of processed critical minerals coming from China.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And so we're now on track with the lithium loans that we provide to Thacker Pass, the conditional commitment to Rhylite Ridge, Ioneer in Nevada, the graphite processing facility in Vidalia. Louisiana. We have a number of grants that the manufacturing supply chain office provided to folks.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
We're now on track to fully meeting our lithium needs by either the end of this decade or the early part of the next decade.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And it's next generation technology. So we're not just taking stuff that's already being done and deploying it here. This is all next generation technology. And that we have proprietary access to because we invented it here at the U.S. Department of Energy and at the National Labs. And we're going to make sure that we scale that up here.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I think people just don't understand that we're not competing with China. What we're saying is that there's a number of technologies that are the next generation beyond what China is doing now.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And so when you look at the next generation anode and cathode materials, the next generation battery separator materials, all of that stuff is things that came out of the loan programs office and or, you know, some of the other offices within the Undersecretary for Infrastructure. And I have no doubt in my mind that the very best – long-range batteries in the world will come out of the U.S.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
by the end of the decade. And that is not something I could confidently say four years ago. And that doesn't even get to some of the other sectors like modernizing our grid or virtual power plants or other things. And so today we have 212 loan applications across about 13 sectors seeking $324 billion.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Yeah. Well, I think first we have to recognize that it's a team effort. When President Biden was on the campaign trail, his promise was that America was going to do big things again. This industrial strategy was part of his campaign, right? He went to people on Wall Street, went to entrepreneurs and said to them, I'm going to make it possible for you to do things in this country.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And frankly, I would say the vast majority of people didn't believe him because, you know, those promises have been made before and they were not kept. And he went to the unions and said, look, you are going to have to play a productive role here, right?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I get the fact that change is hard, but you're going to have to figure out how to embrace change and you're going to have to be fervent supporters of this. And I'll also be a fervent supporter of you. But then separately, he went to the environmental groups and said, look,
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
You're going to have to understand that, like, in order for us to get solar panels to be, you know, something that we want to deploy at 100 gigawatts a year scale, Americans want them made here. And so you're going to have to understand what it takes to be able to deploy things at scale. And then he went to the justice groups. And so, look, I get it, right? You were...
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
promised a whole bunch of stuff and none of it came true. And so you do not trust the government. You do not trust these large industrial deployments, but let us come up with a process to earn your trust, right? And we have done that with all of our loans.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And so while the private sector is essential to this, and then the loan programs office, you know, receives a loan application and then actually just provides a loan right after, you know, a lot of due diligence, etc., The ingredients for Americans thinking that we could do big things again was a team effort.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And you see that in states around the country who are now competing ferociously to attract these projects to their states, right? And it's not an economic development story in terms of like who's giving you the biggest package. It's how do we get trained workers? How do we make sure that the infrastructure is there?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
How do we build up new electricity, transmission lines and new facilities to be able to accommodate all this load growth, right? You know, so that is something that's more of an art than a science, right? Which politicians are better at than I am.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
But today I'm getting people calling me saying like, Jigar, I would have never in a million years thought that we could do big things in this country, but I think we can.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
So if we look at Thacker Pass, which is a big lithium production facility in Nevada, they had to go through permitting. They had to go through NEPA. We made their process as smooth as we could. And frankly, my team did an extraordinary job there. But the big thing is that, remember, when we came into office, lithium was very high priced because there was a shortage.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
But there's no shortage of lithium in the world. It was just the processing facilities were short. Since the market's been flooded with lithium, lithium prices have come down. And so the private sector does not want to fund a lithium production facility because lithium has very volatile pricing.