Galvanize Climate Solutions Co-Executive Chair/Co-Founder Tom Steyer Talks Clean Energy

Published Nov 12, 2024, 2:47 PM

Tom Steyer, co-founder at Galvanize Climate Solutions discusses President-elect Donald Trump’s potential impact on energy production and investment and the business and economic benefits of clean energy in the US. He is joined by Bloomberg's Annmarie Hordern, Dani Burger, and Manus Cranny.

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Donald Trump's next cabinet beginning to take shape. Trump picking former New York Congressman Lead Zelden to lead the Environmental Protection Agency. Trump's saying, Zelden will quote ensure fair and swift deregulatory decisions. They'll be enacted in a way to unleash the power of American businesses. Joining us now as Tom Steyer, former Democratic presidential candidate, of course and the co founder of Galvanized Climate Solutions, thank you so much for joining us around the table. So we're going to get a Trump two point out. Potentially, they're going to roll back a lot of the work the Biden administration did. When it comes to the energy transition, how much does it matter because the market is already off to the races.

Well, let's talk for a second about what's really driving the energy transition, which is economics, prices and markets. Over the last four years, solar prices have gone down by sixty percent. Solar sales have gone up four x. If you look at what's happened to batteries last year, just in one year they have in China, the price had If you look at what's going on in terms of ev sales. We look at it in the United States, still going up, but not going up that fast. If you look at what's going on in China, they went up eleven percent month over month. They went up fifty percent year over year. When you look around the world, what's going on is abundant renewable energy. That is actually the story. What we're seeing in the world is a huge move to renewable energy and the energy transition happening much faster than people in the United States understand. While we're talking about oil and gas, which is basically a stagnant market.

So what does that mean to have a drill baby drill policy at a time where you already have peak oil domestic production in the US and you have this transformation you're talking about.

So let's put some numbers on it so that we can really understand what we're talking about. The US is the biggest oil and gas producer in the world. World we do about thirteen and a half million barrels a day. If we do drill babeled baby drill, we could take thirteen and a half and move it to fourteen. In the context of the world oil market, we're doing about one hundred and two million barrels a day. That is, this is a stagnant market. Even Opek thinks that the total amount of oil sales will go up by eight percent in the next twenty five years. Solar sales went up four x in the last four years. So what we're really seeing is an exploding clean energy market. We're not going to ever, We're not running out of oil and gas. But what we're seeing is an abundance of renewable energy and an abundance of new technologies that are competing on price. You know, I wrote a book Cheaper, Faster, Better, How We Win the Climate War, And really that's all we're seeing is market forces business. How do you win cheaper it's cheaper, faster, it's faster and better. And so when we look around the world, governments can't repeal markets. China can't repeal markets, neither can Donald Trump. What we're seeing is people around the world acting based on prices, what's in their own interest and what's the best product.

There is another large source of energy demand that's really ramping up quickly besides the renewables, or it goes in tandem with the renewables, and that's the energy needed to power AI. Basically the amount equivalent to large cities needed to power just maybe even just metas AI demand. When you look at that, you look at the Trump White House push or the coming White House for deregulation. Is there red tape that needs to be cut anyway to allow for this huge source of energy that's going to be needed to power the future?

Of course there is. I mean when you look at the United States, we are very very slow in terms of permitting, We're very very slow in terms of adding new clean energy products or oil and gas projects to the grid. So yes, we have a very slow moving process because so many people are allowed to weigh in. It just takes so much time. And of course we should be moving much faster. But when we really look globally about where the new we're talking AI can move US energy consumption by twenty percent over the next decade. That's a huge move for us. But if you look around the world, if you see what's happening in Asia, Southeast Asia and South Asia, like in India, it is going exponentially. They're going to do five times as much electricity by twenty fifty five. Times as much. And so when we really think about what's going on in terms of what's driving prices, what's driving volumes around the world, where the real business is, what we're seeing is it's really in renewables.

And it's interesting. Just as we touch on on that oil subject, OPAC has released their report oil consumption is done eighteen percent since July. This is the fourth consecutive cut that they have in terms of demand, and that's to do the chinel. I want to focus on one of the things that erks Donald Trump's Donald Trump, we know is other people eating America's lunch and any move that he makes to step back on I R which has done very well in the Red States, by.

The way, overwhelmingly in the words in the Red States.

So just how aggressive a pullback is are going to be, because I can tell you why, there's a lot of European and global CEO city and I there are going I'm ready to eat your lunch. If you don't want to do if you don't want to build this business, We're ready to do it.

Look, that is the point I'm trying to make, which is America has to compete America if we're going to this transition is happening. America should be leading it. This is an absolute necessity for us to be the leading economic country in the world, the leading political country in the world. And I think it's going to be clear no matter how mister Trump feels about what should happen, what is happening is this transition, and American companies can absolutely dominate here. But we have to choose to do it, and we have to put the money into it, and we have to put the manpower into it. So I look at this as a great chance for business, and it's just business. This is just about what is cheaper, faster, and better, and that is traditionally what Americans have done really well at.

Well, then what level of stimulus could we see from him? What level of incentive could we see for these areas. He's been very very very very heavy on the rhetoric against a lot of the incentives that we're in the IRA, et cetera. So how does he temper with that? How does he balance this?

I really think that what's going to drive this is American business, that it's not. Of course, the incentives of the IRA were important in terms of deployment of solar, of wind and the sale of evs. But the truth is all of those things are going to keep happening globally. All of those things are going to keep happening in the United States. I mean, if you think about the idea of solar prices going down by sixty percent, if that would be oil going to thirty two bucks, from eighty bucks to thirty two bucks, that didn't happen. But you know something, it's not stopping down sixty We'll go down another sixty percent and they'll be at the equivalent of fifty fifteen bucks, Tommy, or the barrel of oil. If the that's dominance.

If the private sector is doing this already, though, and there was concerns that spending too much at a time on inflation at one point during the Biden presidency hit more than nine percent, then what was the point of something like the Inflation Reduction Act. The former president future president continues to talk about that he's happy with clean energy. He has someone like Elon Musk surrounding him, but he thinks it should be driven by the private sector.

It is going to be driven by the private sector. It is driven by the private sector. I think when I think about the inflation Reduction Act. I think about an attempt to try to subsidize companies that are clean, to try and put them on a level playing field with companies that are polluting. That's really how I think about it. But over time, when these prices come down, the subsidies go the need for subsidies goes away, and that's really what Let me give you one example. Over the last three years, Texas has tripled the amount of solar it uses Texas they are by far the biggest wind producer in the United States. The four biggest wind producers in the United States are all deep red states. They're not doing it because they love the concept of renewables. They're doing it because it's cheaper, because it's good business. And that's what we're seeing is in fact, cheaper, faster, better markets, prices, economics. That's what's driving this world. People are talking, people are saying things, but really what's going on behind the scenes is just you know, you guys were talking about the dollar. What's driving the dollar? What's driving interest rates, prices and markets? You can't revoke them. We're in a world where, in fact, we are going a very straightforward way and we can talk about it, and the sentiment can move back and forth. But if you look at the first Trump administration, actually clean energy did really well.

It did.

Yes, there was a lot of rhetoric, there was a lot of anger, there was a lot of emotion, but the fact of the matter is the world just kept powering right through it.

Tom, We thank you for your time this morning.

It's great to see you.

Tom Styr of Galvanized Climates Solutions

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