Robinson Meyer
Appearances
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And so the moral of that story, it seems to me, is that LPO's job, the thing that makes it different from the rest of the private sector, is that it can lose money. And it can lose money on worthwhile projects, or it can decide that basically it doesn't need to make money in a short period of time. It doesn't need to respond to the conditions of the spot market at any one moment.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
You mentioned earlier that LPO has made money, that it's been making money recently. There's like two famous stories about LPO, which is that in 2010, it made a $465 million loan to Tesla. But also, at around the same time, it made a $535 million loan to this company, Solyndra, which went bankrupt relatively quickly and became a big issue in the 2012 campaign.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Its experts are supposed to identify promising new clean tech and turn it into something that can scale up, something you can actually buy and use every day. And because of the Inflation Reduction Act, its lending authority grew from $40 billion a few years ago to over $400 billion today.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
One question I've had about LPO for the past... few years, is like, you know, the Tesla story is great. The Solyndra story is obviously haunts the office. Not anymore. Did we overlearn the lesson of Solyndra? Like, is the fact that LPO is making money, that's great, right? It's good that it's making money. We're running the government like a business.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
But like, LPO's job is not to run the government like a business. So... Did we overlearn the lesson of Solyndra? Like, should LPO, if it is doing exactly what it's supposed to be doing, should it be losing money?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Ezra has talked a lot on this show about what it takes for the government to help America build abundance, to build new power plants, new power lines, new housing. And I think the Biden administration got closest to that aspiration through the team Jigar Shah leads. So I wanted to talk to Jigar about what lessons he's learned from the Biden administration's economic experiment. What worked?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
So Biden came into office promising to do big things. This is like a theme you keep returning to. And as you were saying, he went to the climate people and he made a set of promises to them and he went to labor unions and made a set of promises to them and said, we're going to bring back jobs. He said, we went to the justice people and said, we're going to get pollution out of your communities.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And the Inflation Reduction Act, which is like the signature partisan bill of his administration, tries to do a lot of these things at the same time, right? It's a decarbonization, an environmental bill. It's a justice bill. It's also a manufacturing bill. How do you see all of those impulses brushing up against each other in the bill and in the Biden administration's policy writ large?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
It has grants for environmental justice. It does a few different. I think if we were talking maybe two years ago, Biden officials would be describing it a little differently.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
What are the trade-offs the LPO made? How does Jigar think about turning policy into products? And since this experiment is not over, where does clean energy go in a second Trump era? As always, you can email the show at EzraKleinShow at NYTimes.com. Jigar Shah, welcome to the show. Oh my goodness. It's so great to be here. So I want to start here.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I think looking back on the past three years of LPO and on what's followed the Inflation Reduction Act, there's obviously been this boom in clean energy and clean manufacturing that's happened across the U.S. But when you look at the numbers from LPO specifically... They suggest that there's a lot of dry powder sitting in LPO. So LPO has $400 billion of loan authority.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I think it's issued $54 billion of loans. I think $19 billion of that has come after the election, and you should correct me if any of this is wrong. And I believe there are 200 applications with over $300 billion of loans waiting to get dispersed, waiting at your office. So what has gone into that holdup? Why haven't there been as many loans issued from their offices? There could be.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Why is there so much dry powder at the end of the Biden administration in this very important program?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Let me just say, like, voice the other side of that argument, though, which is something I've heard from companies that are applying for LPO, is that the process is really arduous. It's much more arduous than the private banks, which on the one hand is good, right? Like, that is making use of the Department of Energy's experts.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
It's making use of its ability to kind of put its stamp of approval on certain big projects. But something I've heard that's related to that is, like, if you go to a bank and you ask for a loan, you can usually get a sense in a few months of whether you're going to get that loan.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
But when you go to LPO, it can take a few years to even get a sense of how far you are in the pipeline, of whether you're going to be approved. And those years represent millions of dollars of planning investment. They represent burned runway. They represent a lot of lost executive salaries, right? Was there too much process here to make sure that all of these loans were airtight?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
The LPO isn't only just teaching them how to do big things. They're actually doing something else, which is that I think the office and the Department of Energy more broadly have followed through on a set of promises made by the Biden administration at the beginning of its term, right? That this wasn't only about doing big things in America. This isn't only about big manufacturing projects.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
This is also about making good on pledges to labor. This is about making good on pledges to communities that have suffered under pollution for so long. Something that LPO has done a lot of is to make sure that communities benefit from projects.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
There's a critique from Ezra and others that when you add all those other pledges, all those other requirements to these big projects, you know, you require labor standards, you require community input. It's not that those things are like not worthwhile, but they slow the projects down.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And it takes time to do the planning for all these different aspects of a project when what the ultimate end goal is making sure there's a battery plant. After running LPO for three years, what is your sense of it? And should we have the same requirements? Should we try to make all the same pledges next time?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Before we get into policy, Donald Trump has won the election. How screwed is the clean energy industry?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Well, I think that this is exactly the question, right, is where does thoughtfulness and process begin? Because you're describing things that are not requirements per se.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
However, I think if you go to a company and you're like, you know, you should really have a community meeting to figure out what the community wants, that's going to read to a company much more like a requirement than maybe they're going to feel like they're being voluntold.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
How would you get the dollars out the door faster next time then?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Let's talk about some specific industries. I want to go back to this question in the context of the Trump administration, but for now, let's talk about some specific challenges we're facing in decarbonization. So more than half of LPO's deals since 2021 have gone toward EV or battery companies.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And just last month, you announced a conditional loan to Rivian to build their giant mega factory in Georgia. What's the state of the EV market in America broadly?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
The EV supply chain is so different from the conventional internal combustion vehicle supply chain, and I think LPO has invested in nearly every part of it. So can you talk me through just the different parts of that supply chain? The battery section, the car, the charging network, where do we stand on each of those sections?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I think that gets at one of these core tensions in the Biden administration policy. So when people hear about what the Biden administration has tried to do around clean energy deployment, clean technology deployment, there's an assumption that it's part of their climate and environmental goals, which it is. But you often, as you just did, frame things differently.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
There was a Bloomberg report earlier this month that China has gotten its EV battery costs below $100 per kilowatt hour. And that in climate tech and in the clean energy world, we've been talking about this $100 per kilowatt hour benchmark for a long time as the place where EVs and electric vehicles will out-compete internal combustion cars on price.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Like, this is the mythical benchmark that we need to hit. It seems that China has now hit that mark. And if you look at their EV adoption figures... Nearly half, more than half of vehicles sold every month now are either plug-in hybrids or battery electric vehicles. Under Biden, the administration has made a lot of efforts to onshore the supply chain.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
But how are we going to compete with the Chinese EV manufacturing complex that seems to have achieved all these cost reductions that we're not close to yet?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
From New York Times Opinion, this is the Ezra Klein Show.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
What would happen to the investments that the Biden administration has made in battery chemistry and battery manufacturing and EVs themselves, like the big Rivian project in Georgia, if some of these policy supports, either on the manufacturing side or on the consumer side, the $7,500 EV tax credit were to drop out?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
So what do you see as the main drivers of decarbonization or of clean energy deployment?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Something that the Biden administration and the Trump administration seem to completely agree on is that what we absolutely should not do is import a lot of cheap Chinese EVs, which, by the way, would reduce oil demand, would help our decarbonization goals. Why should the U.S. not do that?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
In some ways, that feels like the most classic I think throughout this conversation, you've rejected that some of these tradeoffs exist, but this seems like the most classic tradeoff that there is, right? In your argument, we should be favoring domestic deployment of these technologies over the emissions reductions of them, especially if they're coming from China.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
It just seems like you're taking a real hard stand on this particular tradeoff.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
One of the big stories of the past few years in the American energy economy writ large is that Americans and the economy broadly is using more electricity again. That is often talked about as a phenomenon of AI, that it is purely a result of AI. What do you think is driving that rise in electricity demand and how big a deal is it for clean energy?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
So as Americans have used more and more electricity, suddenly electricity prices have gone up. Companies think they're going to go up further. Microsoft and Constellation are reopening the Three Mile Island nuclear plant to meet the demands, in their case, specifically of the AI industry. How is nuclear doing in America right now and how do you see AI playing into it?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Do you see the politics around nuclear changing right now? I think historically, this is something that Democrats have been more skeptical of and Republicans have been an enthusiastic support of. This year, that changed somewhat. You saw a lot of battleground Senate candidates from the Democratic Party supporting nuclear enthusiastically.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And it's actually from folks like RFK Jr., who are now the bigger skeptics of nuclear issues. Do you see there being a broad shift in how people are thinking about the politics of nuclear energy on the grid in the United States?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
How large a role do you think climate and the global effort to bring down greenhouse gas emissions plays in to the ongoing global deployment of these clean technologies? Like, are the clean technologies going to deploy kind of anyway because they're superior, as you were saying?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Trump is going to take office next year, and he's indicated, and Project 2025 indicates they want to undo a lot of Biden's policies around decarbonization and clean energy. What do you think is going to happen to LPO and to this current set of projects?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Is that what you hear from the entrepreneurs and business leaders that you talk to? How are they feeling about the Trump administration?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Or is this something where people want to solve climate change and they want to develop and so they're going to uptake these green technologies?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
There's another scenario in the future Trump administration, which is that Vivek Ramaswamy, the seeming co-lead for the incoming Department of Government Efficiency, to the degree that such department will actually exist, has been really critical of LPO and has said that some of the money going out the door should be clawed back. Can they do that? And what do you make of that?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I guess I agree with the Americans love bragging about this, but I'm not sure that their love of doing big things comes through the political system. For instance, Biden has tried to do a lot of big things and Biden's party just lost the presidential election. And you really think that the presidential election was all about energy?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I don't think it was all about energy, but I don't think it was about this stuff at all. I think Biden made a pitch to voters that he was going to bring back a certain type of American dynamism. We saw a lot of that in the economy, and then it wound up not mattering.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
It seems to me these trade-offs are pretty important, and it also seems to me that the way that political parties are set up right now, the set of incentives that they're acting under, are we really set up as a country to be able to do the big things that we want, and are we going to be able to get there?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
What is your advice? If there is an LPO next year, what is your advice to that office's director, to the next LPO director?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And final question, what are three books you'd recommend to the audience?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Chigurhjot, thank you so much for joining us on the Ezra Klein Show today.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
This episode of The Ezra Klein Show was produced by Roland Hu. Fact-checking by Michelle Harris with Mary Marge Locker and Kate Sinclair. Mixing by Isaac Jones with Afim Shapiro and Amit Sohota. Our supervising editor is Claire Gordon. The show's production team also includes Elias Isquith, Kristen Lynn, and Jack McCordick. Original music by Pat McCusker.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Audience strategy by Christina Samulewski and Shannon Busta. The executive producer of New York Times Opinion Audio is Annie Rose Strasser.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
I want to follow like three different threads there, but I think at this point, let's introduce people to what your job is. So you run the loan programs office at the Department of Energy. What does that office do?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
The IRA expanded LPO's authority by 10 times from, I think, $40 billion before the IRA passed to now more than $400 billion. How has that changed the way you do your job? And also, how does LPO fit into the Biden administration's decarbonization policy writ large?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Two years ago, Joe Biden signed the Inflation Reduction Act, the biggest climate law in U.S. history. Its goal was to revitalize manufacturing jobs and make U.S. industry competitive with China. And by one measure, there's been nearly half a trillion dollars in investment in green energy and manufacturing since the law was passed.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
What kind of companies are applying for loans from LPL? You mentioned that car companies have these giant factories that will eventually be profitable, but it takes a very long time for them to turn a profit. I think lots of manufacturing companies find themselves in that position.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
But like what other companies, what other kinds of startups or long lasting industrial companies are applying to you for loans?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
You can talk about who has been approved for loans or who's gotten a conditional, yeah.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
But then Democrats lost the election, and the future of decarbonization is far more uncertain. So where does the clean energy industry go from here? Jigar Shah is one of the best people positioned to answer that question. He spent years working in the private sector, leading companies that invented new ways of financing green infrastructure.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And so that's mines and like industrial mineral refining facilities, in other words. Totally.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Can you just lay out where you see LPO fitting into the bigger scheme of things in terms of the politics of Biden's agenda and where that intersects with private industry?
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
And he's now the director of the Loan Programs Office at the Department of Energy. You're going to be hearing a lot about the Loan Programs Office, or LPO, in this episode. The LPO is supposed to help fund renewable energy projects that private sector lenders find too risky or meager to invest in.
The Ezra Klein Show
Yes, Biden’s Green Future Can Still Happen Under Trump
Can we get more specific with this? Like, what can LPO do that others in the industry or others in the private sector cannot?