What do you know about your power grid? Energy shortages are top-of-mind issues across the globe and in America as millions of people are experiencing negative impacts of current energy policies. How do we maximize energy production for reliable...
What do you know about your power grid? Energy shortages are top-of-mind issues across the globe and in America as millions of people are experiencing negative impacts of current energy policies. How do we maximize energy production for reliable baseload power, environmental protection, national security, and personal freedom? Listen as Linda interviews Travis Fisher, President & CEO of the Electricity Consumers Resource Council (ELCON). He is a consumer advocate and provides tips on what can be done to make sure secure, reliable energy will be available in the future to help protect freedom and national security.
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Linda J. Hansen
Welcome. Thank you for tuning in to this episode of the Prosperity 101 Breakroom Economics Podcast. My name is Linda J. Hansen. Your host and the author of Prosperity 101 - Job Security Through Business Prosperity: The Essential Guide to Understanding How Policy Affects Your Paycheck, and the creator of the Breakroom Economics online course. The book, the course, and the entire podcast library can be found on Prosperity101.com. I seek to connect boardroom to breakroom and policy to paycheck by empowering and encouraging employers to educate employees about the public policy issues that affect their jobs.
My goal is to help people understand the foundations of prosperity, the policies of prosperity, and how to protect their prosperity by becoming informed, involved, and impactful. I believe this will lead to greater employee loyalty, engagement, and retention and to an increased awareness of the blessings and responsibilities of living in a free society. Listen each week to hear from exciting guests and be sure to visit Prosperity101.com.
Thank you for joining with me today. Energy shortages have become a top-of-mind issue as people across the world and in the US are experiencing negative impacts brought on by current energy policies. With me today is Travis Fisher. Travis is President and CEO of the Electricity Consumers Resource Council, otherwise known as ELCON, where he is an advocate for electricity consumers. I first met Travis years ago when he served as an economist with the Institute for Energy Research, which has been featured on this podcast in interviews I've done with Tom Pyle, his former boss. I've kept up with Travis over the years and I'm excited to bring his insights to you, the listener, as we talk about energy policy and how it affects you every day. Travis, thank you for joining with us today.
Thank you. Great to be here.
Linda J. Hansen
Could you share a little bit about your history, your bio, because you're so experienced and knowledgeable? So, what would you most like to share with the listeners?
Sure, I'll touch on the basics. So, I studied Economics at NC State, which is where I also found the sort of Austrian school of economics or the free market view of the world. So, from there, I decided to come to DC to work on policy. I knew I was supposed to work on something that was hard. And there were a few different policy areas that seemed incredibly hard, one of which started the whole power grid. That is just a massive challenge on a lot of levels. And I thought, “Well, the economics of it are interesting, the challenges are there, the sort of the need for a transformation.” Everybody's talking about the transition to renewables and things like that. So, it seemed like an exciting area to jump into. So, that's what I did.
So, I started my career. After school, I went to FERC, the Federal Energy Regulatory Commission. I was a staff economist there for a few years. That was before I took the job at IR. So, I left work for IR and then through the Institute for Energy Research job and Tom Pyle, I was pulled into the transition. When President Trump won the election, that was an interesting time, because we were sort of all thinking in terms of what might the transition look like. A lot of work to be done both on energy policy and sort of the executive branch, work in general, so I jumped right into that and knew that the work was going to be massive.
So, I spent a little more than a year at the DOE. So, just to zoom out a bit. FERC is technically an independent agency. It's one of those sort of new-deal type agencies where it's a bipartisan structure. It does have sort of a dotted line to the DOE. Strictly speaking, it's not part of DOE, but it is sort of under the energy umbrella. But in the transition space and sort of the who was going to do the Trump admin’s energy work, it was a – lot of focus went to the DOE. So, that's where I went. I went to the Office of Electricity.
At that point, I did a pretty comprehensive study on I believe it was called a staff report to the Secretary on Electricity Markets and Reliability that ended up being a very comprehensive study that was published in August of 2017. And from that point, pretty much been trying to recover from the work that went into that. That was a massive undertaking. But I went back to FERC after that. I was an advisor to a commissioner, and then I started in April of 2020 at ELCON. But I've always had this sort of I need to address difficult problems, to work from the point of view of the sort of underrepresented side of things, which is the consumer side of things. So, that's sort of where I'm coming from. That's the common thread throughout, I think.
Linda J. Hansen
Well, that's great and I really appreciate that. And that's something we share in common is working to support and represent the underdog, in a sense. And a lot of times, I feel like the underdog is the American citizen, and the American citizen who has been sidelined and pushed aside for other ideologies and agendas, as government has gotten more and more bloated and as policies have become less positive for individuals and families across the country.
So, I appreciate the fact that you have chosen to work on behalf of, you know, consumers, and so you're choosing something that's kind of the path less traveled. And that is to protect consumers and work for consumers. So, on behalf of all electricity consumers, we say thank you. So, for those who might say, “Well, how do you help me?” If there's listeners, now they're thinking, “Well, what does ELCON do? What's your work?” Tell us more about ELCON.
So, we advocate at the federal level, I should note that there are a lot of groups that do basically what we do at the state level. So, these are industrial customer representative groups that are in the rate cases, usually against the utility. So, this is your investor-owned utility. That's the power company that you get your bill from. The industrial customers are probably the best organized in terms of money and lawyers, and all of that stuff in terms of trying to push back against what utilities are doing. Because at the end of the day, we have to keep in mind this really is a space where utilities have a tremendous amount of power. In most cases, they are a state-granted monopoly, meaning sort of you're coming from a conservative side of things, you think in terms of free markets and competition, entrepreneurship, these are, in a lot of ways, the opposite of that.
So, they get away with a lot, because what they do is they either lobby the statehouse for, you know, for favors, or they're able to put things in rates that you wouldn't otherwise want to do, or they make it sound really nice. We're going to build all sorts of new solar panels and things like that, but it's going to be included in your rates, so you end up paying for it. So, the role of the consumer advocate in that dynamic is really to be the educated person who stands up and says, “Hey, we disagree with this part. You say you're doing it for the right reasons. We actually just don't want to have to pay for that.”
And that can be everything from either a new transmission project, a new – you know, everything from energy efficiency, things that were – or a state policy to. At the federal level, it's even more interesting, because it's less directly tied to the consumer bill, the utility bill. So, everything we advocate for at the federal level is basically the wholesale market. So, you're one step removed.
So, then it gets really tricky. Then it almost crosses over into a philosophical space, where you're not really in a rate case, where it's not just the industrial customer versus the utility, and then you sort of have a bargain settlement agreement that comes out of that, and you sort of win on dollars and cents. This is a real policy arena. And this is where it really matters to get into the weeds and try to understand for what the federal electricity policy is, where we're headed, what are sort of the most expensive things that you could try to either mitigate or stop.
A great example is, you know, what FERC can do is just give incentive treatment to various different things that it likes. So, it's basically saying, “You're going to earn a certain rate on this investment that you make. We want you to make more of these investments. So, we're going to give you instead of a 9% return on it, you're going to get an 11% return.” And if there's no consumer voice that stands up and says, “Hey, wait a minute. Wait, we don't even agree with that, and we definitely don't agree with spending more money on it.” Without that voice there, that would just be the way things are. I mean, we are sort of the thing that stands in the way of that sort of utility old boys club of just kind of doing what they want and spending all they want.
Linda J. Hansen
Well, I'm sure that that is an uphill climb, and I'm sure that people really do appreciate the work that you do. If people want to learn more about what ELCON does, where would you say would be the best source? I mean, your website, obviously. Give the website address but then, according to the various industries they're in or what their issues would be, what would you recommend?
So, for industrial consumers – so large, industrial consumers, we only have 13 member companies. So, we're a relatively small number of companies, but all very large. If you're interested in finding out more about what we do, certainly go to Elcon.org. You can also email me at email@example.com. But as far as getting up to speed on the policy, everything from learning about what your own utility is doing, so if you're a residential customer, like almost everyone is, figure out what your utility is up to, figure out what they're advocating for at the state level at the federal level.
In a lot of cases, and I'm going to go on a tangent here, but it's called the Bootleggers and Baptists theory, where – I don't know if you've heard this before – but it's basically, the Bootleggers in the Baptists end up advocating for the same thing, but for very different reasons. So, this is an old story. This is a Bruce Yandle story from, I think, 1983. And his framing is basically, they both want to ban the sale of alcohol because Baptists do it for sort of the higher reasons, the – you know, it's a religious – it's a moral thing for them.
Of course, then you have the business interest that comes in. So, if you're a bootlegger, you only make money when alcohol is banned. So, the bootleggers come in and say, “Oh, we actually like this policy here because, you know, that's the only way that we make money is by, you know, we're the ones that ship the booze around when it's illegal.” So, you see this in a lot of the green utility space, where it's the utility says, “We really have to do this green thing.” And of course, they are able to say that with a straight face, because the green thing is unquestionable. You know, you can't challenge it.
So, then what happens is, “Oh, well, turns out the green thing that we really like,” whether it's energy efficiency or building new renewables, transmission lines are a great example, the green thing that they wanted, “Oh, it turns out, it really helps their bottom line.” Their stock price really favors this thing that they just did. So, it's one of those like, “Oh, please don't throw me in that briar patch.” They really want to be thrown in that green briar patch.
And that's what I see over and over again. So, it takes, you know, you have to do a little bit of parsing between what the stated goal is and what maybe is in their financial interests. And if you remove the financial interest piece, utilities don't tend to be in favor of it. So, a great example is, “Hey, we need to build a lot of renewables.” And you would say, “Okay, fine.” But the utility would be the one saying, “Yes, but we should build. It has to be us.” Instead of, “Oh, well, let's do sort of an open source that everybody can compete on, like an RFP.” So, that's just one example of, you know – there's the stated, the nice-sounding thing that you would think even a consumer would be for. And then really, it's always about the bottom line.
Linda J. Hansen
Well, it always is about the bottom line. And you and I have both worked in politics long enough to know that there's always a money trail, and whether it's with energy or any other issue, there's – I loved your analogy there, the Bootleggers and the Baptists, because there's always, you know, people that you would think would not agree about things. But politics makes strange bedfellows, right? Because –
Linda J. Hansen
Yes, because they come at it from different angles. And, you know, we were talking before we were recording about what journey it is to do any kind of lobbying or advocating, especially on the consumer side. I mean, you could be, you know, working with big, big business and being able to, you know, get paid a huge salary or to be, you know, promoting huge, you know, international policies that you can support in a sense. I'm not to say that every big business or anything, I don't want to make a blanket statement of any sort. But I mean, this is just one example.
But when we can choose sometimes to try to protect and help and support the underdog in a situation, it is just an uphill climb. And I've often told people that working in politics or trying to work with regulations in politics is like a seven-layer spider web. And in order to get a regulation changed, you pretty much have to hit every single intersecting point of every spider web along the way. And just when you think you made it up to the top one and you think, “Yes, it's going to be changed,” you know, some change happens in the committee or you know, somebody isn't reelected or something happens, and you're back down at the bottom layer.
So, it's really quite challenging mentally and emotionally and oftentimes physically to be able to really help change regulation. So, for our listeners out there, I mean, maybe some of you who are listening, have never really thought about what types of policies go into your energy bill. Or if you're a business owner, what types of policies, you know, what happens at, you know, in all these government meetings at the committee levels in in the back rooms? You know, what happens to decide energy policy?
And then how do you decide if these green energy initiatives are good or not? You know, we can't just follow the dollars. Because, as we've learned, you know, following the dollars does not always mean it is the best course for individuals, businesses, families, or our nation. So, what would you say to people that they should really look for in terms of protecting their own interests as individuals, but then also protecting the interests of their business?
Well, I would look to – it's important to think about both aspects of sort of how the cost of the electricity sector, which is something – it's an infrastructure that underpins everything that we do. We're only here on this computer because we have power and it's abundant, and we have all the light we need. And it's an amazing thing, really. But the way that I'm seeing policy shaped, the electricity sector now is not just through the direct items that we're talking about, and the things that hit your power bill.
There's an explicit shift now to try to put as much cost of the electricity sector into tax base as possible. So, you saw that with the poorly named Inflation Reduction Act. And so, I heard you and Tom Pyle talk at length about this, I'm not going to go in detail, but he's right. You know, it rounds up to $400 billion. And it's just a staggering amount of money that goes into subsidizing the new generation, sort of the things that the green technologies that are favored by policy.
So, this is everything from wind production tax credit, solar investment tax credit, you know, all of these policies. They add up to something like $370 billion. So, that is interesting to me because that sort of an acknowledgment that it's an expensive thing to do, a forced transition from the grid that we have to the grid that some people want. But then it's a question of, “Well, we'll just fund it with taxpayer dollars.” And the interesting thing there is, “Well, I'm not sure I wanted to hit my tax bill, either. I definitely didn't want it to hit my utility bill. I'm not sure I wanted to hit my tax rolls either.”
And then there's this other question of, “Well, if we just throw it on top of the national debt, then it's some future person's problem.” I may be the future person, too. Still going to be paying taxes for a while. So, there's this interesting dynamic of, you know, it's not just as simple as paying attention to electricity policy that gets into everything. You know, this is a much bigger issue. This is tax policy. This is even the energy security question, which is a fundamental thing.
We need natural gas to generate the electricity that we have here. We've seen on the global scale what sort of a gas price shock looks like. We've seen it in Europe. The war in Ukraine is awful on a lot of levels. But one thing that exposed was this idea that if you sort of take the energy security, the underlying fuel security for granted, you can get burned in a bad way. And so, I worry about that in the US, too. And so, you know, it’s really get the electricity puzzle to really put all the pieces together. It requires, you know, the economics of the generation, the transmission, and sort of the whole new foreign policy, tax policy.
You could zoom out, I suppose, and just say it's a giant mess, or one thing that I've appreciated that you're going to do is boiling things down and saying, “Well, it doesn't have to be this complicated. It could be more straightforward.” And in fact, I think we could be moving in I think – we could still have something like a transition. It wouldn't have to be forced. We could use market forces to do it. We don't need politicians to say, “I'm the central planner, and I know exactly what the right resource mix is for everybody,” which is kind of what we're letting them get away with now, if you think about it.
And that's the torch that we've handed over when it comes to net zero policy. It's like, “Well, we're not going to do our own homework and figure out what we want to heat our homes or to power our buildings, all that stuff.” And if politicians know for sure that that's where they're supposed to go, I mean, I just don't see that it's very American in the first sense. You know, it's not free market. It's not pro-individual. It's allowing a politician to say, “We know best. We know what the grid ought to look like. Therefore, we're going to do policies that get us there.”
And I'm not sure anyone, especially if you're doing it in a very partisan, a budget reconciliation bill, that's not the kind of thing that's going to give you sort of the national level electricity policy, a durable policy that you would want for decades to come. So, I think it's fair to say we're in a big mess. Love to hear how folks think we can get out of it. I think going back more to market competition and backing away, asking our politicians to not be central planners, I think, is step one.
Linda J. Hansen
Well, that would be really important. And you know, you touched on something, energy security is national security. And we, during this current administration, during the Biden administration, we gave up our energy independence. We were not only energy independent for the first time in multiple decades, but we were an exporter of energy. And so, we were really energy dominant. And now, we are not. And we are really at a very vulnerable position in terms of energy availability and usage.
And people have no idea how much that affects them. I know that some people in the Northeast have received letters from their utility that says, you know, “Be prepared for blackouts, brownouts, and things.” California has had this and we talked about – Tom Pyle, I think one of the episodes was “Green New California – Will Your State Be Next?” You know, it's like all these green energy policies do not allow for energy stability and security.
And people don't realize, too, the stability of the grid is so important and how much we need to think through that baseload power issue because, you know, the average person doesn't really think about baseload power. I mean, I didn't, before I started consulting with an energy institute that, you know, I learned so much, right? But baseload power is basically, for those listening, it's really the level that you want to have your power available at all times. So, when you flip on your light switch or you turn on your computer, you know, it's there. It's instant. Okay? This is something we take for granted in America. But we only have been able to take it for granted because we've had a steady baseload power. When we don't have steady baseload power, that's when we run into trouble.
And green energy, often like, well, it can be part of a grid. It can be part of the grid stability. It can be part of the makeup, right? But a lot of these, maybe you can touch on this, it cost more. They cost more to power up and power down, you know, when the wind is blowing or the sun is shining versus keeping a steady baseload that can be done through the fossil fuels or through nuclear, and then allowing the renewables to be the additional or the bonus power in a sense and things.
So, it would be really – I think, you mentioned simplifying it for people. If people understood that it's very, very important to keep a baseload power, you know, it's like you can't expect that when power transmission is inconsistent, that you will be able to always do what you are used to doing, and this is important. And there are people who have agendas and who are making policy, that could care less about our energy independence or our energy stability, and it affects so much.
I mean, think about people in disaster situations. Before my mom passed away, she was on oxygen for many years. Okay? There was a major power outage in the area where she was. I had to bring her to my house because she just couldn't be without power for very long and even with a generator, it wouldn't have really sustained her needs. And so, so many people are affected when we don't have a steady, stable supply of energy. And it's not just the consumer, it’s manufacturing, production. Its security. It’s transportation. You know, supply chains. It's everything.
Yeah. You covered a lot of ground there. I guess the one thing that I point out, there's some commonality between New England and California, not in the weather that they have, but in the fact that they are weather-dependent. And the fact that if there's enough cloud cover over enough of the state of California, they're going to have problems because they're expecting a decent amount of solar to be there. Or if there's, you know, an equipment failure in the solar panels themselves, we've seen events where solar panels will trip off, and it will be the size of a giant power plant, but it's because it's hundreds of various different solar plants tripping at the same time.
There are events like that all the time. There's the New England event, which is slightly different, also weather-dependent though, which is they are a fuel-constrained region. They don't have the natural gas pipelines to the region that I'm sure most of them would want. We can get into the politics of that if you like. I think it's a shame. I mean, I thought it was – it's just one of the craziest things to zoom out a bit and explain. New England imports liquefied natural gas from other countries. Why is that? It should startle everyone. It should make you say, “Oh, well, our energy policy is in bad shape.” It's a combination of the Jones Act. We can't ship to ourselves, which is a weird thing.
So, obviously, I'm more in the camp of let's repel that. That doesn't quite make sense. We also have – you know, it's only something like fewer than 200 miles between the most abundant shale gas plate in the world. That's like Utica and Marcellus shales are, you know, that's – we're talking in the state of Ohio. We're not talking somewhere crazy far away. But just to be able to pipe that shale gas into New England, that would be a complete game changer.
Instead, what they're doing is, you know, at best, you have some amount of gas storage. You have some other heating, oil storage or other energy storage you can do. But they are relying on mild winters to get through the winter and to have enough fuel to both heat homes and to generate the power that they need. And it's mind boggling to me that year after year, they sort of roll the dice and FERC talks about this. The region, the grid operator there knows all about this. They've been talking about it for years, but we still haven't figured it out.
So, you know, that's a snapshot at so how backwards our energy policy can be that we have, you know, the Everett port in Boston is importing LNG recently. I don't know when the last shipment was but from Russia. We're importing Russian gas to Boston because we can't build pipelines in the United States. So, that implicates a whole lot of different state policies. But there's also a recent push to make it more difficult to site and permit other gas pipelines that are first jurisdictional. So, this is not a state-by-state problem. It can also be a FERC problem.
I wrote comments opposing that. FERC basically was trying to make it more difficult to site pipelines and that was in a policy statement that came out in February, I believe. Immediately, Chairman Glick was called to Senate ENR and basically dressed down over the issue. And he later switched that policy to a – call it a draft policy statement instead of an immediately effective policy statement. But it's things like that, that you wonder, it's a head-scratcher in terms of, you know, we would think that in the US, we could get energy policy, right? But it's almost like we love to snatch defeat from the jaws of victory.
We have all of the shale resources. We could even produce so much and export so much that I think regime like Putin's would be over in short order if we had just decided to produce and export. So, yeah, that gets back into the foreign policy piece. But there is a whole lot, you know, in terms of what can you do about this. I guess step one, if you're not an electricity nerd, it’s to learn a little bit about it.
But I mean, just see a politician that you like, does that person support general principles of freedom and competition? Or is it more of a, you know, every time you hear the phrase net zero, that should be a red flag just because that's someone telling you that, you know, it's almost like, if you want to do anything, if you want to move anything, we're talking about driving cars, we’re talking about powering an electric grid, it's all going to emit CO2. So, if you're if you if you want to go into a net zero or extremely, they call it a deeply decarbonized world, I can't see how that's compatible with, you know, a policy that's pro-freedom.
Linda J. Hansen
Exactly. And so, for people that are listening, the energy policy, you know, he mentioned, it's so complicated. There are so many options out there that can provide energy. But as I mentioned, too, the baseload power is very critical to have a strong baseload power. So, we have a steady supply of energy that is reliable. But then where do we get that problem? You know, we don't – we, like Travis and I, certainly do not believe that we should be getting our energy from Russia or other nations when we can produce it all here in the US and that makes us more secure. It makes us more independent, but it allows us to also help other nations who may not be as secure or independent.
We can help other friendly nations and provide energy to them like we were previously. And so, it's truly a complicated issue. not easy to cover in one podcast, of course. And I'm sure some of our listeners are probably more confused than they were when they started. But bottom line, energy policy matters. And it matters to your own financial security, it matters to the national security, and it matters to the future, for you and your family, your businesses. So, for everybody listening, to learn more, could you please give the website again, Travis? And then just give the website and how they may contact you.
Of course, Elcon.org and my email is firstname.lastname@example.org.
Linda J. Hansen
Well, that is very helpful. I'm sure people will appreciate that. But then also, before we close, could you give just three tips you'd say to maybe employers or employees in the workplace to talk about these issues in the workplace, so people understand how this policy affects their daily life?
Well, I think when things get complicated, you know, as we said, the COVID-era was crazy, especially in the workplace. And when things get this complicated, I like to step back a bit and think about things like first principles, like freedom. And so, when people are coming around and saying, “Well, you can't come into the office if you didn't get your shot.” Like, that was mind-boggling to me.
And so, it's the same. You see it in terms of ESG principles and, you know, it's sort of the green stuff. It's like, “Well, I can't work for this company if they don't embrace, you know, whatever the ESG fad is of the time, or if they're not swearing to go 100% renewable by tomorrow.” I just think it's important to think, is this some sort of political fad? Is it something that maybe I don't want to get bogged down in the moment? And how does this square, you know, with the broader concept of freedom?
I mean, it comes down to, you know, a company promising to do right by energy? In general, I have obviously no problem with that. When it comes into the space of advocating for policies that limit the freedom of others, so you're basically going to – again, to the point of view of federal government as a central planner and telling you what's good for you, I think that's where it gets really dicey. And I think it's incumbent on the individual, whether, you know, we're talking employees, employers, to say, “Hey, we need to cherish this idea that we have individual choice that we have freedom.”
And I think that applies across the board. It applies to power sector and applies to all the things that we do. So, I would always go to that, like if it's just one of those things. If somebody says they're going to mandate you into prosperity, I don't buy it. You know, it's a question of, “Well, we just need to transition to green this or green that and, you know, everybody's going to be so much richer, and we did the studies, and everybody's going to have so much more, walking around money.” If it sounds too good to be true and it sounds like somebody's going to try to mandate you into prosperity, I would just question it and say, “Let's go back to basics.”
Linda J. Hansen
Oh, that's a great place to close. And listeners, don't let anyone mandate you into what they perceive to be prosperity, because it will not be. It's like you can't tax your way out of a recession or a depression either. So, freedom is what we're after, freedom for businesses and individuals to thrive and flourish for nations to flourish. And we can do that with appropriate policies in the energy sector and in other areas.
So, Travis, thank you so much for spending time on this interview. I'd love to have you back again and just thank you for working towards policies that promote freedom and will help consumers across the nation.
Great to be with you. Thank you.
Linda J. Hansen
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