Energy - Joint

We have minutes we need to adopt so i'll entertain emotion. Motion second. Second birth back thank you all in favor. In your post motion carries. All right we have a short agenda I know it'll be very informative glad to have mr **** with us today i'm gonna go ahead i'm not going to butcher his bio by reading it or talking about him i'm going to ask him to introduce himself for the record and then kick right off into his presentation so michael if you would you are recognized introduced yourself. Thank you chairman I turn both of them are on is that a problem I think one's enough okay thank you so much you need me my name is mike nasa i'm a partner with the law from jackson walker i'm an energy and environmental regulatory lawyer and most of my legal work is with a generation transmission electric cooperative although I am not here on their behalf today don't blame them for anything I say and I also seen service and advisor to an energy education effort called life powered and I definitely will be referencing a lot of well research data from their website which is life powered or. Is that enough perfect please please proceed. Well thank you sir and thank you committee members for your attention this this is gonna be about a pretty technical said a topics bomb and do my best actually i'm going to keep it at a high level and certainly will be willing to go as deep as you guys want it in in cuna the state of the grid and how epa is making things worse a topic that is probably not for into you there's four things in my try to convey today i'm gonna give you all a high level state of the grid from a perspective of my so the the the mid cantnet system operate that the is a majority of the arkansas area in the southwest powerful and i'll refer to it as someone give a kind of a state of wear things are previous it's not it's not a start good news or in a degraded state we have some concerns and and i'll express that in as high level as I can then I will talk about the epa threats that are looming we've already had EPA threats and we are you know we're expecting a non slot here and i'll talk about that in brief talk about some of the things folks are doing to stem the tide of the problems both with the great and with a including some great work that your state has done certainly in the courthouse and I am involved in several cases where arkansas is active and on the right side of trying to keep the lights on and then if I have time i'll talk about geopolitics I think the perspective of where the us is relative to our global allies and competitors and how energy in iraq's is is probably one of the most important issues of our time and is not getting enough attention so i'm frankly never talk about energy without at least bring an ad up so hopefully all leave enough time for that so stated the grid here's a quote I don't know if you can see it I will i'm gonna just summarise that this is a commissioner from fire the federal energy regulatory commission offer is the federal agency with that's a part of a department of energy that. That make sure that our grade at least that which is subject to its jurisdiction is is reliable resilient and affordable as possible unfortunately for it doesn't have the authority to actually make policy at the state level so it's kind of a cooperative arrangement between the state governments the system operators that run the grid regionally and the firk and ferk is made up of a bunch of great engineers and and some good lawyers but they don't really say things like this historically I shall the slide because people who run places like firk are generally solving problems not complaining about him but the situation we have is so drop dire that for commissioners across the board are expressing deep concern they held a technical conference in the last quarter of last year that included just you know violent agreement frankly across the entire commission about the state of the the degree of state of the grid and so commissioner christies just wind voice from that I just gave one set of data from from a deal we report that was released about kind of winner resilience and reliability just making an observation about how the number of outages they were not a number of hours of outages that americans are having to tolerate is on the rise it's a significant problem it's a problem in the summer but it's a particular problem in the winter for two reasons i've read is more challenged in this and the winner moving forward and all explain that and people die from the call more than they die from the heat so that is a really important consideration moving forward and we'll talk about this really busy slide but trust me this is the short version this is about a couple three hundred four hundred pages of stuff summarized in the slide and this is basically the nat the north american electric reliability corporation which is the entity that is in charge of reliability across all the grids issues both a long term assessment on an annual basis and then exeasonal assessment in the chart here on the left the map on the left. Is showing that the we have a significant component of the country in orange elevated risk or red high risk and i'll get to it more in a in the in a bit that arkansas smacked out in the middle of that area of elevated and high risk and that's the long term assessment and then on the right as the is the winner assessments of the current winner that were hopefully getting out of unscathed i'm not going to keep my fingers crossed on that we have elevated risks across the grid and what I did was just as a kind of a teaser for that report which I highly recommend everybody's reading because it is it is a really important way to understand just how at risk that both of the speed in the mysogrades are is just the breakdown of how it is they get to that elevated category and it's a very busy slide and i'm not going to go through it all but I provided that as a resource to you all so they can you can see that they have different scenarios they project very cold weather that doesn't also happen to have the wind blowing of the sunshining and also might include some outages in the natural gas system and within the thermal fleet and they they tested me or they tease all that out and they basically identify whether there is a statistically significant risk and we had a very high risk relative to baseline these are the kinds of reports that frankly didn't used to get issued we we have had press healthy reserve margins and a lot of reliability in resilience in our market and now we're seeing pretty much every year a set of reports that's showing more and more concern about where things are so what's going on a couple of things are happening and II don't want anybody to take from my remarks today that that I am against any form of energy or against any your vision of the future the facts were the facts we have a significant component of the electricity market that is either for esg purposes or for their own corporate goals pursuing the carbonization and with the organization comes the retirement of both call and natural gas. Plants it is not just a cold story as very important to understand it has been primarily a cold retirement story but we see gas being retired prematurely as well and we do moving forward and the most important thing is that we see really relatively little to know new gas and no call being built and that is equally problematic so again a busy slight slide i'll start on the left the left is basically a run down from my so that's john bear the ceo and that statement is from here's proof can't kind of preamble to there that their most recent reliability and report and it is you know posing material adverse challenges to electricity electric reliability he has a map that I extracted into this slide that shows just how many utilities have these aggressive decoration goals it's overlayed with states that have those goals to and then in the in the high grass II captured from some analysis done by energy ventures analysis is a good consulting firm using eight data showing you what the stack of poor proposed new generation in for the future of the grid is and what you see in those charts is a dominated graphic of wind and solar with very little natural gas and the gas that is being proposed is small and peaking and that combined with the last of current dispatchable resources is the reason that these concerns are being expressed by these grid operators really in an unprecedented way. So I always because my in my day job i'm an environmental regulatory lawyer for the power sector I always want to start and say well what what are we doing with the carpenters station and you're not going to get a climate change debate for me I stay in my lane what I can tell you is that there's there's certain there's a thing called math and it's not even algebra it's a rhythmitic and if you add up the amount of co two reductions that we are accomplishing on a decorativation in the united states and you compare it to the way the direction the world is going I mean i'll tell you a couple reasons why that is in a second. You see that we are not moving the needle my unilaterally decarbonizing our electrically we have a high performing high efficiency power sector that supports a hyperforming high efficiency manufacturing sector and moving for its getting even more efficient but if you look at this is a very busy graphic but i've been using this graphic and updating the data with a team of researchers for since twenty fourteen so now almost a decade and it's you know never been to burnt cause it comes straight from the data sources that are sided on the graphic the big blue pagraph is the twenty fifty parks premiering and concentration of co two in the atmosphere that drives a lot of the international treaty negotiations that occur between our country and others the black line that you can barely make out is the impact on that twenty fifty concentration if we eliminate all call and gas fire power plants in the united states the red line is if we decargonize our entire economy. So i'm not going to sit here and say we should be doing nothing about carbon that when we see our grid put at risk under the aspects of decoration because we have to do it we have to put things in contacts because materiality is a biggest and by the way it's a big issue under the clean air act and it's one of the reasons why i'm confident we will defeat epa's overreaching regulations i'll get to that when I talk about those rules but it's also a big issue for global competition and so that is just the kind of an aside that i'll get back to later back to the state of the grid the state of the degraded rid and the move away from affordable sources to more intermittent and more transmission builds means that we are spending more money. On electricity the trend line here this is just a a graphic debt from doe information about how as we've mitigated our utilization of call we have increased cost now there are certainly called plants that are old and need to be retired there are some that are kind of middle aged and have some life left in them the debate that I know that you all are grappling with constantly is or what role does your existing call fleet have and how how long should it be maintained and II would hope that the data about the state of the grid would make everybody feel very concerned about the fact that we really don't have megawates to spare I can tell you everybody that I represent who has called gas and nuclear in their fleets is absolutely revisiting their retirement schedules the grids are frankly doing some things that i'll talk about later to encourage them to revisit those schedules because we cannot once we give up a power plant it's gone forever it's work force if it has a supplier mine or a supplier transport system it's gone forever this is my cell looking forward this is a scary graphic and it is really nirty and I won't bore your detail with the details but it you can be found on the organization of my so state site. O m my so that entities that are regular you know kind of running the great of that part of the arkansas and then up throughout the midwest are projecting significant shortfalls in terms of capacity reserve margins moving forward this is unprecedented this is the kind of projection moving forward that should make everybody concern and certainly is making everybody ask hard questions about any premature retirement of a thermal resource and it's not just myself it's as well here's a quote from a commissioner from the sp component of texas who observed he serves in the capacity of chairing the resource energy in adequacy leadership or real team at spp this is the team that actually was created because of this emergency and he was told by spp's technical staff and they've provided this graphic that's included that really based on the retirement schedules of the utilities even before we factor any pay we really cannot afford to premium truly retire any more call plants he observed that in a decision that he was making at the time i'm not going to bring up that decision it's really just a talk about the fact that this is happening in his capacity as as the head of that team as pp is very concerned like myself and they're both doing something about that and i'll talk about that in a little bit so people ask me all the time how can you explain winner storm specially in taxes I was a part of a forensics team that did a lot of analysis on the storm I stay in my lane and looking at kind of market and power plant performance but if I am never asked to say you know show one slide about winter storm you read this is it it comes directly from the energy information administration they average they they monitor average dispatch hourly dispatch what this graphic shows in both texas and the workout market and my so an spp the markets that are contained all of our concern. If you look at the percentage of total installed capacity that each type of fuel makes us the grey bar okay so what percentage of the total mix is wind or solar or cole or gas nuclear. That's the grey bar during winner storm throughout the period and this actually doesn't even take the most extreme hours the graphic would be even more dramatic if we actually narrowed it on the most extreme hours. If you just take that week. And you look at what those resources did that's the blue bar so all I would say to use what my son s PP are staring at is how do I envision that can stay reliable when I don't have the cole blue bar. Any more moving forward and I lose maybe half of the gas bar and I don't build enough new to replace it that's why we did learn a lesson now there's a lot of people pointing fingers about what happened during winter storm and most of them are wrong okay but ultimately we have to grapple with the fact that win the wind is not blow and when the sign is now shining batteries will not be big enough to spend the gap especially during the winter and so there is a really critical period here of needing to maintain their more dispatchable resources that can actually pick up and cover those and it's not just your winner storm elliott this is a graphic from an analysis I am using eight data that shows the kind of down versus up dispatch during winter storm elliott twenty twenty two that you're after didn't have significant problems in the grid all week we did have significant problems in the grid we didn't kill people like we did and when your store murie but we had real issues in economic impact and you see again calling gas are up dispatching relative to everybody else in the grid begin this is not a bash about anybody who's not adding significantly during those periods is just a reality check of what you do when you don't have one of those two graphs those bars anymore and you cut another bar and have same thing for myself the slide was my so almost identical type situation little more wendering what winterstorm elliott actually helped us okay it's important to note that but when it wasn't windy we had problems in the timing of that wind is critical and we see that year over a year so let's talk about timing because this is really one thing that I see a lot both in the kind of arguments in the courthouse about how we can decargonize our grid without impacting reliability but also in all the policy debates that you all have to deal with. Timing is everything and so you see just watch the green box line in this graphic this is from sp this is during winner storm elliot. I mean when can be a massive producer in the sp and it is and then it can drop to nearly zero. And that's just because the weather does that that doesn't make that wind a bad resource it makes it resource that we have to plan smartly to cover solar is a growing part of the resource it's covering peaks and summer more so than then when windows and it is a great resource it's not built out as much in this market so it doesn't show up as much but the the summer is a big chip or sorry the winner is a big challenge for siler so you see again in this graphic the grey gas and the blue call a match in that grid without the blue. And half that gas it's a pretty scary thing and I have an overlay demand to this but it you know it's already busy enough so that was and here's myself similar problem okay so my goal is to count highlight these things and not to go through each of these graphics and no one ask me to look at a lot but the basic massage here is i'm giving you the data to go back look back look at these reports to understand that these resources the reason that the grids and the national regulator are expressing concerns and warnings is because they're seeing it in real time and it happened again this winner so here's this winner twenty twenty four. Martin luther king saved us literally we had a push back in delay or I mean in demand right we had we had a vacation a holiday weekend and are resources on monday morning especially down in taxes wouldn't would have been really close to not covering our needs thank goodness we had lower demand that day we had higher demand on tuesday actually came up to set in some records. When picked up a little bit that day it helped us okay here i'm just showing you again in the same kind of presentation the data what jumped up what grew in each of the grids during that during the winter of twenty twenty four event that we had on him okay weekend gonna keep out of the weeds and i'm a address something that I hear a lot of and i'm involved in a lot of different power generation projects ranging all resources including renewables and batteries and batteries are a huge part of our future both in the transportation sector and the grid sector right but one thing that people always forget is the problem with batteries is not technology okay we have and we will continue to make better and better technologies the issue is scale. And duration okay this is a couple of word pictures that I had a couple researchers you know one is a battery expert in another is this doctor mark mills he works with the life power initiative I mentioned earlier he's written a lot on minerals and mining and batteries I highly recommend his work he's a lot smarter than me and I stay in my lane he's a battery material science expert and then he and a guy named doctor brand bennett whose material science phd compare notes and brant help me with this slide basically if you wanted to replace a single call union of twelve hundred megawaters installed capacity for a month. You'd need a basically have all the little that's currently mind in the world now let's be fair we're not going to actually have a whole power plant size month long battery we're going to cover durations that are more realistic but a much more realistic scenario is in our car lot of people in taxes a lot of people have been plammering for more more renewable penetration in it already renewable heavy area in texas and what that were picture tells you is or in order to have four hours of storage which is the absolute minimum to expect batteries to be able to cover the gaps between peaks and when the resources can be made available within the renewable fleet you'd have to build a battery every two days or actually every day for ten years and you'd used one and a half times the current global products and lithium and that's just a day long battery and for places that incur that do have core spells we saw it in your we and elliott and we saw it even in a little bit this year in the south but in the midwest in the north. That duration is going to require extraordinary lithium production and there's a whole lot of side of the whole chain of you know the supply chain that i'll talk about later as well but it's important to understand when you see those gaps between when we have high renewables and and when we have low renewables weak win those renovables are low we are not going to magically cover the durations that are involved with batteries it is not a silver bullet type situation and it has massive material implications as well. And one thing I always show when I talked to any legislature in the country and certainly congress or anyone else is pleased do not forget the terrible lesson. That texas learned there are a lot of reasons why texas got in the trouble that got but the ultimate to take away as that graphic I showed you we have a huge renewable fleet and when the son doesn't shine and when the wind doesn't below and there is not enough battery to go around and we have any kind of crack in the armor in for example our natural gas production system. We have tragic things happen this graphic is a nerdy graphic but it is the scariest thing I ever show anyone it is the frequency in the system during winter storm it plummeted down to below the threshold of fifty nine point four hurts why does that matter all the machines that are directly connected to the spinning mass in interconnected grid have to have stability and frequency it's it's the beautiful thing about the machine but it's also its feedback if frequency stays at that lower level for too long the entire system has safeties that start tripping it off and that's when we truly have blackouts what we have and we have rolling outages are strictly speaking brownouts a system goes black when it is literally drained a voltage okay and it's drained a voltage when all these safeties trip off okay the one thing the press got absolutely right about winner storm uri and texas was that we were four and a half minutes from a complete blackout cause we were already four and a half minutes below this magical threshold international experts from you know testified to their legislature about this so it comes directly from them the scary thing about that is in you might then cay he's from texas so hyperbole comes natural to him but this is actually factual okay it would have been the largest energy disaster in the world instead of three million people being inconvenienced without power for three to four even seven days like me we would have had thirty million people without power for a month. Or maybe as long as six weeks. So that signs fiction book cut stuff and every bill every reform that you saw it passed out of the texas legislature postwin or storm urine check the vote counts. It didn't become a democrat republican thing. Okay they pass a pretty sweeping reforms to try to make sure this happened and they had unilateral bipartisan support because no member who represents any constituency wants to see this happen again and it is a very real risk in our marketplace and anybody tells you that it's a black swan event it's because texas was an interconnected whatever excuse they give you. Call myself i'll walk through all the data that disproves that that event can happen again and we're doing everything we can prevent that but that's where the grid is heading if we don't start planning and then i'm gonna say a couple of things briefly about the future of demand you all probably have heard many reports and including from some of your state experts about how you know we did squeeze a lot more out of our system for a number of decades and made a lot of progress on cap capacity capital usage of electricity but demand stop going down and is now going up that's a function of multiple things and is not yet been fully influenced by the production or the next the the proliferation of electrified transportation so transportation is going to be electrified under a lot of goals and it's only going to increase demand for electricity that's not really captured in this graphic yet. Okay this is a lot of things going on we're resuring manufacturing jobs thank god for now okay we're increasing electricity electricity use because of that data centers are all on the upper trend this is the beginning of a steep curve not the obliped it's going to flat now if you talk to any experts okay so that's coming directly from let me show you something that you probably didn't read about in a press release because it's not being talked about too much and this is just taxes but I took it because texas is one of the few places that has a wholesale deregulated market which is kind of part of the problem and when your storm uri but I won't bash it i'll just sit here and tell you that one of the benefits is you can get some data. This is the number in terms of magazine capacity of pending interconnection requests in the state of texas in the aircock region that's forty thousand megawatts of new power generation either manufacturing data center. Petrol can you name it we can't know how many of those megawatts are real. What the rule of thumb is it's usually about forty percent can be discounted because they'll be shopping between texas and somewhere else but that number. Is fully half or peak demand. That's like a whole region's power sector potentially going to be built out in the next three years. Okay even if it's half that number right and you thanks to all the good policies you all have are going to compete for a lot of that type of load and you're gonna have and I know you already have districts those kinds of load request I had one gant cooperative client say one gigawaters the new ten megawatts and other words we used to get big interconnection request that were like ten to twenty to thirty megawatts now we're getting I thousand megawites or a gigaway of capacity a big data center a bit petrol chemical a permonia plant steel mill these are all things we want to be domestically produced but they can they consume electricity and that's why you see those projections moving for. So before I turn to epa i've got to make a comment about a really terrible initiative okay michael bloomberg just announced five hundred million dollars to double down on the last five hundred million dollars he committed to beyond call to be beyond carbon and this is a slide that robert price is a great energy expert produce to just put on paper what that would mean if it actually is successful they are explicitly trying to shut down every last call plan as soon as possible and slash gas plant capacity in half that's what I was referring to earlier and block all new gas plants. That would effectively take out forty percent of all the US electric generation annually by for by twenty thirty and let me be clear annual is actually no way to look at the great because i've already showed you all the data what would it do to the peak hour capacity I don't have time to do that number i'm waiting for robert to do that number but it's going to be a lot scarier than that number it's going to be a lot higher than forty percent or peaking capacity or ability to actually cover during our worst called and hot snaps is dependent on these same resources and so premature retirement and having a well funded initiative to go after that is a really bad thing and it's hard and consequences this is an analysis that that energy ventures analysis did for a group I work with to just they just keep track of new generation builds so what this tracks is everything gas windsor batteries and what it shows is a couple pretty scary trents you probably have heard about him for many people around the state supply chain issues post post you know shut down are still still lagging so we're having significant delays in new renewable builds new battery builds new gas builds and we've had almost twelve gigawatts twelve thousand mega whites of gas fire generation cancelled. Okay not unrelated to the advocacy campaign to oppose the assembly who works for people who are trying to build new natural gas discount of orthodoxy in the environmental community that we shouldn't have any faster few or hydrocarbon based electric generation is not doing us the service and this is building but that's just the beginning because then comes epa so what i'm gonna do is put up a graphic that shows you all the power plant or all the power plant related regulations epa is currently deploying these renew things or expansions of existing programs best news of the day i'm not covering all this i'm not even going to cover a subset of it the big scary six are these. There's a lot of acronyms so i'll explain it on the laugh call combustion residuals impact call plants. Mats mercure an air toxic standards and backscale plans ozone transport rule impacts call and gas and manufacturing one eleven carbon will impact call and natural gas and i'll talk more about that because that's the worst of all and regional haze which arkansas has had some history with mainly impacts call also impacts gas and the evil limit guidelines impacts all power plans but call the worst okay all of this is being expedited the really big significant ones are all scheduled by epa to come down in april they align those dates because april is the safest month to know that if there is a change in the administration. A new congress or a new white house will not be able to reach back and revoke those rags by what's called the congressional review act it's not an accident that is trying to get all this done by april because it takes two to three years to undo a regulation through the regular process it takes a signature to do it through the c RA so this is a this is a big rush to finish a bunch of rules so lots of my hats off to your your attorney general your solicitor general doing a great job already the transport rule arkansas like texas and a bunch other states i'll talk about later they're doing good work there but carbon is about to drop and so i'm going to talk a little bit about the carbon this you can study later this is my lawyer's lame attempt at graphics so you can tell how bad the graphic is and you can blame me this is my attempt I cannot show you in a simple way what the rule does for call unless you're willing to say I will retire my plant by twenty thirty two. You have to be committed to do certain things if you want to live till twenty thirty five got to take a twenty percent capacity factor and we're talking about power plans that currently are in the sixty to ninety percent depending on what market there are so that's a capacity factor they will not prove on a proof economic and they'll have to retire forty percent natural gas coffiring as the next step if you want to last till twenty forty if you want your power plant to last past twenty forty and there is a. Big portion of capacity in our country that are not in our engineered useful life goes well past twenty forty those plants have to commit to install ninety percent carbon capture by ganuary first of twenty thirty. And that is completely undoable even if the technology was there for reasons that are laid out and thousands of pages of comments that have been piled with epa but that's called the gas stories actually almost as bad if not worse because a lot of good utilities including generation transmission cooperates are trying to build new gas to make sure we have that thermal dispatchable component in our great this rule basically says if you want to use that natural gas plan at a rate of fifty percent or more which the economics would tell you that they want to. You have to either commit to a low ghydrogen. On a time frame of twenty thirty two and twenty thirty eight i'll explain that in a second or ccs like call like twenty thirty five what this is effectively doing is freezing investment and new gas because these are technologies that frankly have not been deployed on large gas plants and cannot be banked on to be able to be doable logie g is a whole story in another itself it means that the hydrogen is produced through electronics and it can only be produced with zero carbon electricity renewable energy and that means that you have to actually build a whole nother set of generators to power a whole nother set of hydrogen productions to be able to power a whole nother set of hydrogen burning power plants so. Universal condemnation from the regulated community. In the stock it and i'm relatively confident that we'll win the merits of the lawsuits against these rules the problem is they're creating massive regularly uncertainty for our utilities and creating even more of a dilemma and I have a slide in here that I won't spend time on but basically is something I produced in response to request like the house energy in commerce committee who asked me to basically boil down hey what is the rule timeline and water plant owners and operators having to do and my attempt to do that as to slide were in the red I basically and tell you what the rule sets right we're going to finish a comment period we did finish a comment period in twenty twenty three we're going to get a rule this april then the states are going to have to develop plans to implement it epa has to approve those plans and so the realistic timeframe is that somewhere in twenty twenty seven if we're lucky we'll know what the requirements are for each power plan that gives them less than three years to install technologies that have never been deployed at scale with fuels that have never been available at scale in the terms of logic and so there's a reason why there are massive retirement projections because no power plant owner. Can commit capital knowing that they can make that time we'll see what epa does and it's final rule my hope is that they will actually pull the rule down and start again and actually consult with grid operators which they didn't do before this rule was constructed this is a hugely impact on rule it can be done in a legal way and i'll talk about that later if I have the time what are the impacts based on an analysis it was conducted basically acknowledging that that there will need to be limitations on gas pick gas production and all but elimination of the remaining cold fleet. These are massive. Impacts you can see we're talking about a range of between a hundred and fifty five thousand to two hundred and ten thousand megawites of call being retired but the but the real terrible secret about this rules is coming impact gas capacity to so the numbers are very large on the gas side. What is what is you know one of the things that we did and had experts study when we first got this rule is what was cpa thinking. Epa actually did not consult with firk or nerk or any the regional transmission organizations my so jam texas nobody before they made this rule they've been running around a lot since then hopefully they have actually gotten enough information to pull the rule down i'm not optimistic given the last couple things the administration has done on l and g and different standards but this right here is an analysis that was done out of north dakota to take epa's modeling just say okay you did a great impact study without talking to any experts. We should be challenging that well let's just take your study and unless just correct the one thing we know is wrong which is a creditation they didn't use a creditation for each resource that is approved by for example myself they use their own projections about how much wind and solar and gas and court and new would be available at what time a day if you just fix that and use numbers that myself uses. You show massive outages under their own study and the economic consequences of that are huge and at the study this study was entered into the record by a group of clients including generation and transmission cooperatives out of north dakota and I won't linger there when we turn to the law for a second this is an odd thing for a lawyer to do but I tried to boil down and one slide all the little legal fighting that's been happening in the area of regulating carbon dockside under the clean iraq and stacking up each each rule that has been proposed the is the clean power plan that was proposed in the arm administration the ases the affordable clean energy rule that sought to replace the clean power plan under the trump administration and then the new one eleven carbon policies standard is the current one eleven carbon rule that i've been talking about in one thing that epa did improve upon in this rule that was a mistake they made on the clean power plan that got the supreme court to stop it was they aren't just issuing a unilateral federal plan or fit there allowing states to develop plans the problem is that they have tied the state's hands so much that it's not really flexible at all and you've seen that in comments that have been filed by the states including your state who has done a good job of making those concerns known and this is a really important issue because the way the clean iraq works statutorily and just as a matter of practice is it a model of cooperative federalism the federal government set standards that are aspirational in the states of the primary implementers and win epa has decided to kind of force of course the states it has been a broken situation and that is again the problem here and cheap you know justice course in is concurring opinion on the west virginia case where the clean power plan was struck down with some ferber by the supreme court made it very clear kind of shot across dpa's. Bow that case was decided under a doctrine called major questions and the major questions doctrine is founded aren't separation of powers that the court is knocking as soon that congress intended to and you know imply authority to a federal agency and a federal agency can't infer authority that has been delegated to it unless it's very clear in situations where there are great economic consequences the idea is that's not a way our democracy works if they're doing congress like things. They need to actually have explicit statutory thought that's what the major questions doctrine is but what gorsan said in his concurrence is listened. Major questions and federalism travel together federalism is that principle that these states get to run things that are within their police power guess what there's lots of law about how the grid is one of the fundamental police power op you know realms of responsibility and operating and obligation to states have so i'm not sure how the supreme court is going to dispose of this case ultimately but it could well be a case where the run in between state and federal government is ultimately becomes the deciding point so long and talk about stemming the tide first of all I just want to have a good reason you know put a battleship picture and then if i'm going to talk about a way that regulations I want to figure out ways to to defeat that way so power market reforms are really gonna show you that just a couple snippets litigation and arkansas doing good things on that front and then education and that's a kind of a personal passion of mine that i'm gonna have already made reference to that you know i'll finish with on that section okay market reforms are two things that are happening. In both my son. They are taken a hard look at how they are credit resources I made reference to this earlier and their fixing the things that seem to be broken so they are taking a more realistic longterm view as how we get more and more wind and more and more solar how much can we actually expect to be producing when we need that power or the most and so what you see is a pretty significant drop off in terms of a credited capacity especially for solar look at the long term winter solar capacity a creditation one percent that means for a hundred megawatts a solar you get credit for one megawhat and the reason has to do with all the graphics i've showed you before that's a very controversial proposal but mice is doing everything it can to try to plan for the future and make sure people are not going to just build a bunch of things that they can't rely upon that they need to have a balance portfolio spp similar initiative i'm focusing here on their reserve margin requirements now they have significantly increased the winner reserve margin they went from an annual and number that applied during winter also at fifteen percent to a winner number of forty five percent okay that is a that those two adjustments reflect grid operators that are scared. And and it's going to be very difficult for utilities and generation and transmission cooperates to live under this regime but it is a reflection that market reforms are being deployed and states who believe in the kind of the the the values that these things are embracing really do need to support them because they're doing what they can to keep your grid operating I put a couple of graphics in here from my so to cannot show you how impactful this is so this is the forward projection i've installed capacity versus a credited capacity under a different scenarios in my cell so one thing you'll just notice right up the top is it's a remarkable thing one that we've never seen in the history of the grid where you have installed capacity in megawatts going up and a credit capacity actually reducing. Okay that's a nature of the resources that are being bill rate look at what the number look like before they adjusted for a creditation. It was still bad but it wasn't as bad right you see that shape of the curve shows that yes install capacity still going up and a credit card pass is going down but with a creditation fixes that they're currently deploying the bottom chart gets scary so it's having an impact and it's going to have an impact on what kinds of resources people build moving for pretty big important thing there's also this issue of the retirement time frames of cole and i'm not going to linger here for too long but this is a chart attracting that that that a group energy ventures analysis and energy policy network have been doing to kind of track when people have announced a retirement and when they've actually announced that they're going to actually delay that retirement some of these dates have been delayed indefinitely the yellow circles are actually sites that were acquired by new investors and kept from being retired are not going to be retired because of a lot of the things i've been talking about I circled in red the white bluff in independence time frames that were initially proposed for twenty four and twenty five I got moved to twenty eight and twenty thirty and here's hoping that maybe just maybe the changing regatory environment and market environment might actually push those dates out lots is between us in there however that kind of delay and call retirement has an impact again back to myself the dot and line is what they were projecting their installed capacity to be had those units been retired on the time frame they were originally planned just a laying things a few years has given this additional buffer in my cell so these things have consequences I just wanted to show you that not going to linger too much more on that data but if you're wondering whether all of that is for not every year you keep a thermal dispatchable baseload unit around is a buffer that the greatest and desperate need for so litigation not gonna go deep on this other than just kind of pat arkansas on the back i'm involved in the eight circuit litigation. In support of arkansas work as an intervener on behalf of cooperatives I represent in northeast taxes were very impressed with the way this was or general as handling that case and we secure to stay from that court against epa's implementation of the transport rule and we would have lost generation and we would have lost both gas and call generation had we actually not gotten that stay and so here's to just continued success in them in one of the orders that was issued not the arkansas case because they didn't issue a written opinion on the state but in the fist circuit that this circuit made clear how it felt about epa's rule when issued it it's day that's not the kind of thing that federal circuit courts have appeal usually say in opinions epa is not leaving a good impression on the federal judiciary with its overstep and i'm hopeful that we will continue to be able to stop them in the courthouse but the courthouse shouldn't have to be the saver of arguable and it at this point it is the last bastion of hope so again lots is going on we're gonna have final disposition of all these rules i'm going to break you from the grips of a federal environment regulatory lawyers spiel anymore and just leave that to let you know that this is an important fight and I know your states going to be in that fight and doing want to say something about education I mentioned at the top life power daughter this is an organization that i'm very proud to be the affiliated with I simply service an advisor on stop that I am by an expert in there are lots of very good technical experts involved in this project I mean it's one of many a couple of things they do they're very meaningful they do really easy to understand energy one a one type content and they also are developing curriculum came through twelve curriculum right down the middle not favouring one source or another just trying to raise the american energy I q as i'm convinced that as are most people were involved in this effort if we just teach energy better or maybe even for the first time. To keep through twelve then people will make come to their own conclusions about what they want but right now they're not getting the nuts and bolts are not getting the meeting potatoes of energy education here is a link that you guys can follow in the electronic copy I think they're hyperlinked to the the one or one animated series and very proud of the series it does a great job of trying to break down the electricity issues from you have super nuts i'm gonna finish them just in a couple minutes so I leave time for questions reminding everybody of this graphic in explaining why what is going on in the world that makes that blue pie so but why is it that the world is going to emit so much more carbon in the united states it's because. The world needs electricity desperately they also need energy across the board but electricity you know is not something that is debated in terms of the linkage and correlations between the availability of electricity in the quality of human life honor okay every major indicator we use chattered mortality life expectancy drinking water standards nutrition and educational levels and opportunities all in a reader of course. Drastically improve as you electrify society and that's why there are societies across the globe that are going to electrify and they're going to use the fuels that they have access to which in lots of parts of the world is called and that's why you see statistics like that graphic I showed you here's a robert bry statistic that shows you we're talking about nearly half the world's population uses less electricity than one refrigerator. In a year. Okay that's statistic is compelling what's even more compelling as how many people have literally no access to electricity so do we want the entire world to make waste for use of energy now we want them be high efficient we want our bring our per capital use of electronic of electricity down and with it per capital co two emissions but that trend line of what the globe is going to consume and produce in terms of carbon dockside is not going to change dramatically to justify the kinds of changes to our grid that are occurring under the theory that we're doing something if you want to invest in carbon cash or technologies and battery technologies and nuclear technologies that's the kind of thing that can move the needle globally because we can deploy that in the places that need it but unilaterally disarming are economy and thinking we're doing something good is not the answer and here's a pretty start graphic from robert brice that tells the story this is calls this is called fire generation is not just called consumption i'm gonna talk about call consumption in second. Look at how much the rest of the world especially asia is on a move forward basis or actually on the last few decades basis has increased its utilization and with the carbon dockside but the thing you probably don't hear a much about and I and i've heard this for the first time maybe ten years ago and now it's it's really a scary graphic and it has to lot to do with our forward projections on carbon dockside is the world is urbanizing. According to world health organization a hundred million people are moving to urban centers. Every year for the next thirty years hundred million people every year. For thirty years that means we're going to build a hundred and twenty more cities that look like shang high. Shanghai nineteen ninety picture on the left shanghai today on the right do that a hundred and twenty more times in the world you're going to use a lot of steel lotter cement a lot of things that consume hydrocarbons a lot of things that produce carbon doctor that's why you see so many people even those that are like really concerned about climate change basically acknowledging that we've got to have a different set of technologies and ideas about how to power our economy then think if we can do with renewal energy and batteries this is the last time three billion people moved to cities and no doubt will do it cleaner now than what we did it between nineteen fifty and twenty ten but those scales have increased energy consumption our jaw dropping and the real current question is who's gonna s- who's going to feel it. Or we know one of our chief global competitors in the world china is actively involved in projects all over the world making new allies every day there's lots of good work being done on that mark mills talks about it david gaddy talks about it from university of georgia this is a slight remark mills talking about supply chain for electrification related things like copper nickel cobalt rares and lithium. It's not just wear the mineral service in a manufacturer or derived it's actually where they are refined and in my closing slide I have to say something about maybe the worst environmental regulatory development and its kind of a hidden thing cause the administration didn't do a lot of press releases about that. The united states currently has by far the most stringent standard for fine particular that's particular of two five two point five microns or less stuff that actually causes my respiratory diseases and and at certain levels and thresholds. We are already twice as stringent as our european allies europeans have not lowered their standard from twenty four there's a big debate with an epidemiologist in talks colleges that a standard as low as twelve is justified the federal government just lowered the standard tone nine. From twelve making it almost three times as stringent as our go outs are allies in europe What is this mean it means we're going to have a whole nother set of non attainment issues but that's not the big problem. And when a skip I have a good data there that shows you how our missions are so much lower than everybody else already this chart was produced in congressional testimony a week and a half ago it was done by I think the pop and paper institute and what they did was they were telling the story about how win the federal government lowers standards like this isn't just about non attainment it's about permitting you guys I have a lot of economic growth potentially happening. Manufacturers from everything from steel to actually electric batteries right this analysis shows that twenty eight different psy permanent holders new facilities either expansions of existing manufacturing or new manual factoring would not be able to be permitted under the new standard any area that's an isn't pink is is within what we call the head room between what's natural background and pm two point five and what the standard is now set and so being able to locate facilities in that pink is totally challenged and in the red is near virtually impossible so this is a whole new area of concern this is a final rule will be litigating this rule I would I would bet that arkansas will litigate it certainly a lot of states will I didn't mean to leave with bad news but I want you to see that I wouldn't expect the april release of the rules to be a moderate withdrawal or stepping back from what they proposed given that they have finalized in them course of a month the pause on l and g exports and are significant impact on economic development for new manufacturers so i'll stop chairman and let's some questions get asked. Thank you motor questions and a require you recognize. Thank you mister chairman thank you mr nassi for coming in and visiting with us when I encourage all the members of the committee to go to life power use it as a resource when you can. Real quick question you mentioned you know the new connection connect requested or in the my so q I believe that's what they call it. Over the next several years. What kind of an impact is that happened were if we're not increasing the amount of electricity that we're producing as a state. Does that have on early economic development yeah I mean I did not have time before today to kind of pull the data for and miss so I did was show a snapshot from her cut as texas as an example but I think it is it's implementing of the growth transit we're seeing that data is goodable and I definitely encourage you all the kind of you know pursue that data because they are projecting you know growth in electric demand in their current planning but I think every rto official many of which actually live pretty close by here would tell you that they're in a constant state of concern about how they're they may be underestimating increased demand because nobody really knows just how much power for example aai is going to result in being consumed that we're not currently projecting so it's going to impact at the them projections of capacity deficits or based on kind of what we have experienced in the past as growth it's not this whole new world and i'm not saying. Skyspallin but again none of those numbers I should capture what electrifying our transportation fleet will do to our electoral consumption which is it's own challenge. Said johnson you recognize. Thank you mister chairman mr nice thank you for going third time to actually hear you present and then I wait with mated breath to hear the next thing that's just say I especially appreciate the fact that use you think you use the term you stay in your lane and you to talk about things that review you go about and there are other things that I think we have prejudices both four and a guest but you've given me that in soon and to try to also stay in my lane and i'm i'm on trying to do so I have some serious concerns and I won't even go into the motivations of why we see some of the things happening like with the epa that they just don't make any common seats unless your goal is to that strategically crippled the image dates for america in I think it's pretty clear that whether that was the internet with it was an accident thing it it would have that effective. Alpha times have to start and say okay what can we in the general standard here in architect what can we do. And the one thing that several my colleagues and I have discussed is the possibility of taking some carriers out of state governmental action to. A stable eyes are the energy capacity and one of the things we've looked at is when we see a. Call plants the three we have you had independence and when whitework and push turk. And. Thanks to on my colleagues in our chairman I got to to return a couple months ago I guess it is still the newest claim is called fire power plan in the world. And based on the the charts you've given us I assume it's compared to fifty years ago when apa first came into existence that is probably immediate one percent of what a typical call fireplant would have been met. Fifty years ago. Is it. From a federal standpoint I guess we knew everyone to until some federal court slaps is down but is it legally forget practically that practically is a whole nother analysis but legally possible for the state of arkansas two exercise in domain and condemn one of these plants. The. An work at some arrangement with some. Smart people in other industries related industries some care of a public private partnership to operate them to ensure the energy stability of our citizens is that something is at a pack dream or is that something that we could do to stop this premium to your closure of these important facilities so we're not seeing our citizens buying like they were in texas two years ago. Yeah I know I mean it it first of all you're not the only person to ask me that questions and I didn't plan that question that that is something that you know first of all the use of that power is maybe less a part of your question as it is you know what should have stayed due to facilitate a hard look and writes you all past the bill a couple sessions ago I think I think sixteen sixty five I think it was where you know the the public service commission is is charged with studying retirements very closely for instance power plants before they are retired I would say being vigilant about making sure that bill is robustly implemented yeah you know utilities. Just frankly have a lot of different competing you know. A competing priorities right one in a positive light you might say they have traditional obligations to their shareholders who protects the rate payer you all so you all clearly have done that in that bill if it looks like a utility just doesn't want to be involved in producing call or even ultimately gas I think it is going to be a very interesting challenge you know their states in the west wyoming i'm sorry you talk having that debate right now about how it can get a power plant to be preserved for potential public private partnership many view probably have had a chance to see the energy center in wyoming where they're actually taken flu gas and testing car and capture technologies in a bunch of different ways that's the state the state can it partner with base and electrical operative there to try to create an opportunity to not only maintain the length of that facilities life but actually commercialize technologies so you know the the cleaner act has been a rousing success because we've sold inverminal problems with technology not ideology. The problem we have now in the environmental regular arena is we have an anti hard your carbon ideology that is plowing through and not looking for a technology answer I mean there is a place for wind solar and batteries but absolutely eliminating the use of hydrocarbons just does not square with science chemistry and material science and we have got to keep on the gold standard that we've set which is to let technologies to be deployed and so when utilities don't want to take the capital risk of keeping a plant open states certainly have every right to be taken a hard look hopefully to facilitate a public private partnership without having to take bold actions but you know for the same reasons I mentioned earlier that just disgorsage acknowledge that you know the great is the police power of the state state gets to do what it needs to do to protect its citizens and I hope it doesn't come to that I hope that utilities will see that states are serious about scrutinizing those decisions and they will themselves impose discipline but I have seen fewer of your utilities making smart decisions along those lines and that's concerning so the state is the ultimate stop gap to making sure that decision making process works both in terms of the public service commission's oversight but also directly in how you all facilitate. You know the retention of plants through all means necessary thank you sir thank you mister. Center stuff for you recognize thank you michael can I call you michael can call me a thing you want you for a long long time it's good to see you. Are you talked a lot about texas and robert brich ras also said that it is total in sanity. To make you most important energy network totally planned upon the weather. He he recognizes and in european countries that we followed along the snep zero. Agenda. Now restarting including germany france others restarting their call fired plans up again. Because they found out that it just wasn't working. An injury in texas when that happened. And twenty one in february twenty one I think some more long those lines. Blackout in it you have said only energy council for a number years in december sixth energy board blackouts were meet to take stress of have certain areas well this time in the almost a nightmare because what technicians just like he said it was less than four minutes away from the grid shutting down in two hundred fifty one people died. During that short period of time. And in the man that used to chair the cia to fifteen testified before congress. That if our grid ever completely shut down for one year we would close two thirds of the people of this country from starvation. Yeah. You agree with it yeah I mean I will just tell you the testimony that that the body in texas that tries to live up to all standard had after eri is flooded with information about just how horrific that that event could have it was at least two hundred and fifty some argue seven hundred but as I said in that slide if if if we would have gone black the experts said it would have taken four to six weeks to restart that grid that would have been an epic disaster and there would have been tens of thousands i'm interested in medical complex in houston life lighting you know thousands and thousands of patients it's hard to get your head around I mean it's like I said you could read a top ted couple book you could read a sci fi book you know there are a lot of books about what happens to our society when the grid breaks down but again it's not a scare tactic it's actually just kind of owning responsibility I know a lot of legislators on both side the island texas and they were embarrassed. That mean this happened to a great state that had great values and did not think it could have that thing happened in a snuck up on them for all the reasons we have described and then you look to what they're doing now to know what what they're afraid of I mean they just passed a requirement that every new window solar facility starting at twenty twenty six hours to back themselves out will a thick and happen in in the powerhouse the united states really in the world in texas it can happen anywhere. This sir. The snap zero agenda. Oh I was reading about that not a lot though. In the net zero agenda as a going from. Where we are now so many parts remaining which is based really on faulty that a data because of whenever this group of left wing scientists that work for the united nations put this in they plugged in a hundred days like plugged in a hundred sixty part for me and preach human who should have been thirty which would have brought all the numbers down drastically but the net zero they're talking about. Would cost us from twenty to fifty we're supposed to beat net zero two thousand fifty. You want to cost that that is. I do not know but it's ten print here multiply a tent triggered times twenty. That's four hundred trillion dollars is that feasible. You know it's not in in the reason I show that graphic that blue pie graph graphic is is that that that data is straight from public sources and the modeling to project what what the temperature impacts come straight from the magic model which is what I pc scientists use there's no debate about climate change in that slide like I said it's just bath and it's not even algebra it's worth me but where were listing we're listening to a. People who aren't really not best frames when it comes to this the series of expertise we seeing what works in this country michael right and that I think you know I think the most of the people that I mean have good intentions but there are definite forces in the world that will benefit from our unilateral disarmament of our economic ability to compete and and there are a lot of entities the country of china is one of them that will benefit dramatically from our not just organized but are dependents upon the things that really they control in at the same time those countries like channel pack has denied injuries india are building sales of coffin players they have seen a hypothetical including millions of solar panels right they're building everything right and you know and I say this to people that I know that are are really progressive that want to see renewable you know expand. We better do it right here. Or will or for franklin renewal energy get a black guy forever I mean if we're of work if we pay ourselves and we keep the grid balanced in diverse and we don't go too far too fast we can we can make some we can make some progress. But vastly over playing subsidies and simultaneously just destabilizing our grid is a really bad idea and it could have tragic consequences in that's exactly what textures did because they went to alternative energy much too quickly no question right now the richer. Thank you representative fight. Thank you mister chair i'm to your far right over here michael and I have one question here last week I read an article in the democrat you said and they were interviewing professor michael of the university of arkansas and he was talking about our calls shifting prevention act of twenty twenty three where we solder will no longer be able to sell it retail price but will be sell back to the great educate avoided cost and i'd like to read the statement that he made in the democratic asset last week. He said there's talk about selling the electricity back at about it cost instead of retail cars. It basically allows electric utility companies to grab a bit more than profitability of the systems in a way said michael park do you agree with that well what I know about net metering policies and how both best room utilities and generation and transmission cooperates work I would fundamentally disagree with that statement I don't see how in an economic model of the utility system. Not overpaying for sold or somehow freeze up profit to be garnered by the utility that you know the. The system is just not allowed to work that way I don't know why he would have come to that conclusion i've seen a lot of net metering studies that talk about how it is totally inappropriate I have sold her on my house do I think I should be paid retail price when I didn't build the infrastructure to actually get it to the market of course not that is that is that as large as that shouldn't happen but just saying that somebody shouldn't get all of that is not the same thing as saying that the utilities gonna grab that because that's not the way that the system works if there's a study that documents that i'd be surprised but i'd i'd be interested in seeing it I don't know what was the basis of the statement but most net metering studies in reforms have occurred because it's just not fair i'll put it in broad by partisan terms the people who can afford to build solar on their homes should not be able to charge people a retail rate for those who cannot afford it and whether or not we should be putting subsidies into that it to begin with there's a big question but there is a lot of if you go there's a there's a lost it in california called the two hundred and it's a bunch of california's civil rights organizations fighting back on progressive reforms that have been identified as progressive. Because they basically are shifting costs for renewable things or. You know electrification things to people who don't benefit from those things and that that's a really tough area but you know it's it's hard to understand how utility would actually be able to exact profit because we're actually making a more accurate statement of costs when we pay for people who put solar on them comes your business thank you is chair. President garden. The. Thank you mister no worries thank you mister chair and thank you for being here I am coming from a place where I get really frustrated when we hear one side and assume that it's a poss I think it's a false narrative to to think that we can't do both that we can't salvage the energy grid and take care of the of energy and so my question to you is what are you think we should be doing to make sure that our that are energy sources are what they need to be for the grid but we're also take taking care of clean air and and the climate issues that we are children are facing out I proceed the question first of all the model that the united states is established with the cleaner act when when we were implementing. Regulations to address the pollution's we know heard people are i'm not going to get into a climate debate in on top of carbon docs i'd separately but there are some things where there's just universal belief hey we need to reduce suffered outside and particular matter and and ozone these are things that we have tackled and picked and made massive progress on I mean by any measure if you actually look at the global statistics and some of which I have in there we have made the vast majority of eat the uperiod. And we've done it with technology I mean it's good that we have then deploy renoble energy but most of those improvements happen because we put pollution control technologies on power plants and steel mails and manufacturing facilities and that was wonderful because then we technology we exported that technology the world and so I would love doubt for us to continue to do so and that's a great transition into carbon what I would I you know i'm stuck for me to say but it's the or king for the day statement is when you look at bablue graph if you think about the entire world you know adding and there are five to six billion people with the kind of per capita electricity usage that we have and you put a carbon number on that I do think that will be too much carbon. I'm not a climate scientist but just on kind of saturation level a lot of compelling information right now exists that we do not have a climate catastrophe on her hands but there is a set of circumstances where I think reasonable minds could actually agree that we want that. Giant growth and electric consumption to happen with new technologies right so the thing that the united states should do in my cumberland in this exactly what it did the last thirty years sold those problems with technology carbon catch or technology for a call and gas energy efficiency across all manufacturing sectors not by mandates commercial red don't deeply subsidize it prematurely deploy it and you know drive down the cost and in one thing I have fought for my entire career and i've been involved in the largest car and craps your project in the world is you can't just grow away the test bed if the us doesn't actually keep its call fleet around and commercialize this technology nobody is going to do it because not nation is in the position frankly of large **** and profit that we can and we have done that with other pollutants and there's no reason why we don't and that's why it's hard for me to connect to see people who are extreme on both sides i'll agree with you on that but particularly people who argue that they are you know trying to save the world but they're not actually doing the math to understand that most of the policies of aggressively going after carbon emissions with just technology to their too expensive and not reliable is going to hurt human beings all over the world in a dramatic way denying. People of energy is not a climate policy and that is frankly what we're doing and aren't are global world bank is depriving financing to fast off your projects why aren't we financing the cleanest technologies available regardless of your so I definitely think that we need to come to some common ground and I think that there are some leaders and in dc that actually have attempted that but it's not happening by you know converting an environmental regulatory agency into an energy policy in a forcing agency it needs to happen with the citizens have in representation and it needs to be done in it and a smart way that texting effect that takes in a consideration of global realities that we're dealing with. Follow up mr chair yes great II love to hear you say that and I just wanted to get a little bit more clarification may be about what you think we are to be doing. To make sure that we're also making the air clean our other specific technologies that you or ideas that you suggest well the tragedy right now is that the coal plants that there are they're not that many call plants left that don't have the the state of the art control technologies the reason that that those technologies often times have not been deployed at some of the units that are in the older periods of their life is because there are so many threats to their long term existence they can't justify expending money that could get stranded are many of the great utilities in our country have made investments to clean their facilities both count gas and call by the way. And they've had time to recover those costs when you start drive drop in a hammer so fast that you're actually putting at risk whether or not somebody will have enough time to recover their cost they don't make those investments and so where we're not now as we've got plants that are less controlled that we're having to hold on to dearly and I would just you know love for us to have a regatory certainty created so that they can actually deploy the state of the art technology have that plant last another ten years move to the next series of generators that we're going to do but not in january and danger are great in the meantime you have many facilities in the state that have done a lot of really good investments where they want to call a clean call or just pollution control technologies what I call every every industry's god it's not just about call we've got to create an environment where those kinds of investments continue to be made and we don't punish them for making them by turn around and give him a carbon regulation they can't possibly live with once carbon capture is fully demonstrated and we've got pipelines and we can do all those things sure we can start talking about mandating that technology but we are not there and I worked on projects and you know II think it's going to be clear when epa is told by a court ultimately that it it shouldn't have mandated that technology that that was not the right way to do it but you know we needed to plug up pollution control technology just like we have been for the last thirty years and don't freeze because we're fighting about the fuel a great professor down in texas has this great praise dead you know argue with me about the emissions not the fuel behave the emissions earlier the fuel can technology solve the mission problems. Okay environmental top technology environmental debate should never be about you know some religious belief that we shouldn't be using a fuel not if that feels dependent it's going to be dependent upon by billions of people across the world actually improve their lives we're just never going to win that battle we don't have the more a high ground to do so. It's made america what it's made been able to realize in the rest of the world's going to want. Yeah. Represent long you recognize determined thank you mister chairman in and thank you for your presentation now so you can I was warning after listening and watching the presentation. I can come away with the idea that if we don't send up to the pay in the and the premature plant closures the you know within the not too distant future. We're going to have a great reliability in similar to a third row country is is that fair say well where we will have that direction right I mean II think the the tragedy is that we are at risk of **** things up so bad that will then have to frantically build a bunch of new stuff okay and will rebuild our grid but the cost of throwing away perfectly good things and building brand new ones especially with transmission costs skyrocketing just because of the nature of the bit business and they're not particularly popular transmission right if you do all those things all over again then that the the costs are global competitiveness will definitely be heard. Uhm you know but I think that I don't know who what was me but it was a senator mckey made reference to european countries like I could sit here and show your bunch of data about why it's more expensive to run a grid that has to have a whole backup system right or you might come to that your own with your own common sense but you really don't need to do either or yet to do is what is the price of electricity and in california. What is the price of electricity in europe. What is the price of electricity where people have tried to do this too fast too far too soon. Right and that's the answer if we throw away things still in the ground that we already have prematurely without making investments took you know to address the things that we know and still maintain the reliable grid then we will have said ourselves back decades and decades and the costs will be significant. Thank you sir. Thank you representative resident baby. You're recognized thank you mister chairman missed nasa thank you for being here today it's been a very informative presentation you know one thing that I don't understand and and has caused me just a little concern is the fact that with the usb of having the largest coal reserves a pruven call reserves in the world it like four hundred and thirty five years the fact that china keeps add now these colour powered power players when their proven reserves are approximately thirty five years what happens after that thirty five year period at china and and where do we see the dadamic of our reduction in colour powered plants where do we see that change and and where they're going to go and get their their poll reserves II guess russia but do you have any insights on that or thoughts is a great question. So there is a video in that energy one series it's about your politics and it begins to scratch the surface of the balance of resource control. I did not put in the slide deck today a lot of information about call reserves or gas reserves for that matter but I will tell you that i'm very concerned that like literally my grandkids are going to look back and see that we didn't do anything on a clear energy. And we had more cold and anybody else and somehow we allowed us to start having the ability to leverage that you political security resource and walk away from it and our biggest global competitor some may say enemy was able to jump in that gap. And not only gobble up a bunch of allies because they were financing call projects but then strengthen their alliance with russia who yes has the next largest reserve okay and and we all know the natural gas story cause this is not just about call this whole this whole hydrocarbon religion is about not accessing energy dense fuels like call and gas both of which provided extraordinary strategic advance for the united states and we can solve any questions about them with technology but again I hate to go back to my my cuprays but it's ideological now and that ideology is going to become something we regret deeply if it actually upsets the balance of due political security david gaddy the university georgia has a whole center that studies this issue I welcome anybody to study his information it's fantastic he's testifying congress about it. I mean it's frankly unprecedented in history of the world no nation who has ever had the kind of mineral advantage that the united states house has ever unilaterally disarmed itself the way that we are doing it and the rest of the world especially are most chief competitors aren't just benefiting from us stepping away from leadership their seasoning the boy that were leaving and it could be a decades of impact. The follow up you know want their the other thing that that alarms folks on the other side of the energy argument on decombination the carbon decision. I mean every step that we take here in the UA s is the war it in and completely wiped away by the continued products and any implementation of cope powered plants in china. So that they're wiping out every past this day that we take and it's at some point just what you say it's going to come to through issue we're going to pay the price in our our grandkids and in future generations can pay the price for that yeah and and again II said it before a lot different ways that it harkens back I remember being an acknowledgeable unknown was gosh twenty plus years ago arkansas been looking at you know clink all technologies for a while and I think rightly motivated by by the reality that telling the rest of the world to leave half of their population without electricity or in some cases all their pop isn't going to work and guess what the last twenty years prove that right there vastly they're going to access those minerals the question is. What are we doing about it and I tell my friends I live and asked and taxes i'm not surrounded by republicans okay i'm i'm an employee blueberry range and I tell my friends that are all well meaning and I say. Let's you and I agree on something that if catastrophic climate change is going to occur because of the utilization of calling gas. And the rest of the world is desperately going to deploy it at massive scales that we've never seen before how can you possibly oppose a carbon capture technology cause the carbon country projects i've been involved and had been opposed by environmental groups they think they think it's folly think it's a subsidy to prop up you're not proper up call the rest of the world's gonna use call. A stark way of saying it is how do you want your call. Because you're going to get it. Coach your back thank you mister. Might thank you coming in your presentations and be some great reading material I appreciate there's always you've always provided lots of good data force out i. Recently. Read an article that was related to the net zero effects in the. In europe and i'll tell you that it was an interesting article not on incurs you guys read it is it talks about not not good distabilization aspects of that or anything like that they talked about the cost the industry in the loss of industry is as a function of the price that the electricity is too hard they can't compete southern liberties there's a group over there the scheme together to say hey we got to stop this over we're not going to have any jobs over so that's one aspect of it. I also want to encourage everyone here that you've heard some great things keep studying on the staff because the public service commission will tell you they listen to earth for guidance in the rulings that they make so so we need to put a legislation forward to help them with what they want to do now i'll get to my question so I question is in coming in staying in our lane type of scenario you talked about the retirement of of the call and natural gas facilities in what the state could do with that I get that but along with that have you in any other states seen any move where I think served or johnson brought up to point of other may be private sectors coming in and taking over those assets are doing something with that and that that certain deposit but also the state working with private industry directly in micro generation as far as to help that could you elaborate any on that yeah no it there's a lot of exciting opportunities I mean. We're in a really a an interesting time in history where because that we have abundant natural gas we can resort a lot of jobs and manufacturing and in that has huge benefits rate we also technology leaders and information right we have the ability to actually do data center a I had a lot of things that frankly i'd be more comfortable happening in america as opposed to overseas right all those things use electricity but they are large loads that can be strategically located and strategically locating them close to large baseline facilities is a really smart way to minimize the cost of transmission because we haven't talked about transmission today but i'll tell you you've talked to any legislator in texas. Who openly embraced spending eight billion dollars to extend transmission lines from in a remotely located renewables to our urban centers there have been benefits to that but one of the costs is it's doubled the price on the transmission part of everybody's bill the reason that people don't have picture forks right now that they're close to it in texas is because the energy component of that bill has been kept very low by the natural gas prices call and nuclear right and let's be honest deeply subsidized wind and seller right but that transmission cost is brewing and it's building its more expensive than other I think reference has been made robert priced by me and others roberts don't amazing to hub of tracking the cost of transmission I bought a transmission is costly it's getting more expensive. Everybody who's in the transmission business needs to keep a system reliable so there is gonna have to be transmission but building transmission just to try to make poorly located resources more viable be careful really smart to encourage your large loads. To locate close to existing power generation and it may be that that power plant that's in at the end of its life to use cole and it repowers with gas. That might make sense but I think what i'm seeing in the mountain west in particular representative of that that's that question is getting asked because there's a real lot of very large thermal power plants in the mountain west that basically were built to help move water to california and power the california miracle that now california wants to just rush aside and what they're doing is scrambling to say hey. Maybe we should be partnering this is probably what some of the question earlier was about maybe we should be actually looking to make sure we keep those things online because i've got like five or six data centers that want to come here and they won't have to build transmission. And the repairs won't have to pay for that that'll just help support the existence of a resource that will be there when we need lots of interesting opportunities i've been pretty depressing today but I actually think that's an extraordinary opportunity because large loads. Can be both a great reliable base of economic support they also can be responsive. They can turn down some of them when we need power the most you see that happening at large scale in texas for sure demand response is definitely a part of this equation this is not just about building as much generations we can we definitely mitigate our usage during peaks but we can't fix this problem with just a man side but smart location of of load and generation co location in the best situation is extraordinary opportunity for america. The. Thank you. Senator stopping fold you recognized at damages to real quick question mark what what portion can you break in the texas energy portfolio how much is alternative which is called the first item capacity so that's like the total magazine what they are capable on the best day right over I think it's fully fifty five it's certainly over half of the texas great is now renewable you're now renewable over fifty percent over fifty percent and then the rest of total installed capacity is broken down think nuclear is about ten now call is probably in the fourteenth of fifteen percent range down from what was thirty three percent just a few years ago i'm in the loss of that chunk of electricity is something that life powered has studied and I welcome everybody to look at it because taxes was where arkansas were the permanent basis still located they're in exactly and then and of course natural gas but the the the peak numbers I mean that graphic I showed during winners that called fleet that grey bargain pretty small rate but it still was a pretty big blue bar. And even though a lot of people like to throw around stuff like older recall piras frozen just because one operator didn't know how to run a little night plant didn't mean that the call fleet wasn't extraordinarily resilient the story of winnerstorm uri and coles performance is one of ethic study that everybody should realize if you look at the performance and misospp of called the call flee still reason though oklahoma are not exactly cold state rate oklahoma governor stick he was on on the news the morning after the the biggest scary part of and saying hey cold saver day so yeah I mean you can't just strip all that out and expect it to not have consequences texas paid the price for that now some of those called plants were at the end of the useful life and they needed to retire some of them worked at all that we say hook him horns so I apologize in advance for my mediocre football thing. All right see no further questions thank you members for your attention great presentation michael thank you for being here with that we are journal.