The 13th annual Verde Exchange, designed by its founder, L.A. civic leader and businessman, David Abel to understand and advance the New Energy Economy, kicked off in downtown Los Angeles yesterday with panels that questioned whether development of the green energy economy was best driven by government or the markets.
Panelists agreed that California was setting the pace for the green economy. David Hochschild, chair of the California Energy Commission pointed to the power of California’s influence. Since the state passed legislation to reach a 100% clean energy goal other states have followed so that now 30% of the country’s population live in areas under the 100% clean energy mandate.
Yet, some argued that markets will lead to a wider acceptance of a green energy economy.
Bob Foster, current board member of EPCOR Utilities and former president of Southern California Edison and former mayor of Long Beach, said markets are taking over. While admitting that both public and private organizations have difficulty managing change, Foster asserted that markets move faster than government. If government bureaucracy moves slowly in changing regulations or legislation it could hamper advancement in the market.
“Let the market do its thing,” Foster said.
Hochschild stood up for an effective government oversight role in dealing with energy. Hochschild compared government’s regulatory role over energy policy with the role government plays in regulating roads so that drivers will be safe. Once the regulations are in place drivers can go where they want.
Foster’s plea for the market to lead could run into an obstacle in San Francisco and Sacramento because of the PG&E crisis. Government might insert itself more into the energy area, especially with talk about a takeover of the private utility.
The PG&E problem spiked after recent wildfires and the history of wildfires, especially those caused by faulty energy transmission lines, could change the direction of energy delivery in California.
A couple of panelists sitting on two different panels discussed the possible creation of microgrids and smaller power delivery systems that could help prevent wildfires.
Foster believed that technological advancements in the next decades could make this possible. Jonathan Weisgall, vice president of government relations for Berkshire Hathaway Energy raised the challenge of transmitting energy in smaller more diverse systems.
Regional networks will be needed to deal with energy transfer. If renewable energy sources hit a dry spell in one area they would have to have energy transmitted from elsewhere.
Yet, the recent circumstance of power shut-off by large energy companies to prevent new wildfires just might spur a move toward smaller energy delivery systems.
Weisgall was certain that the markets will dominate the new energy field. He said efforts in Washington to encourage incentives to boost solar energy, off shore wind, energy storage, electric vehicles and carbon pricing went nowhere. He said too many politicians see climate change problems as a long way off. However, he expects change is coming.
While President Trump and some of his Republican colleagues are seen as obstacles to advancing renewable energy, panelists believed the change is noticeable in that Republicans now generally agree about climate change. Weisgall said young Republican voters see climate change as real. He noted that most windfarms are located in Republican controlled districts, with the red state of Texas a leader in wind energy. He believes Republicans will turn to the market for solutions while rejecting the Green New Deal.
The Energy Commission’s Hochschild said with the increase in all forms of renewable energy and the reduced cost for producing that energy—as an example he cited solar costs dropped from 50-cents per KWH in 2000 to 2-cents per KWH today–we should look at fossil fuels as an alternative energy instead of talking about renewables as alternative energy.
If it is indeed the market that continues the charge to a total clean energy future, it’s fair to ask if that road was opened by government mandates?
Yet, even those in government don’t believe the state is the answer to the energy future. Mary Nichols, chair of the California Air Resources Board, who moderated one panel and has been involved in government for over 40 years serving the last four California governors, said, “Change comes from the people, not from government.”