Frontier Forum: A new playbook for clean energy growth

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There was this brief period in the mid-2000s when it looked like a bipartisan climate law was actually possible in the US. The science had become clear, Al Gore's documentary and inconvenient truth had attracted big audiences to theaters, Hurricane Katrina had jolted the country, and renewables were starting to make gains in the heartland. And so, during the 2007 presidential campaign, nearly all the GOP candidates were aligned toward action.

There's not a doubt in my mind that climate change is real, and we have neglected our obligation again to this generation of Americans because we may be handing an reverted badly damaged planet. You had this really this moment over a period of years in the early 2000s where you had really genuine bipartisan interest in tackling climate change and in opening up markets for clean energy.

At the time, Heather O'Neill was working for a foundation led by a lifelong Republican who cared deeply about climate change. One of its policy priorities was cap and trade, a market-based solution that was originally developed in the 1990s by Republicans to fight acid rain. And GOP frontrunner John McCain was calling for a similar system for CO2 on the campaign trail.

We have to have this cap and trade system where somebody uh reduces greenhouse gases, they earn a credit and they can sell it to somebody else while we've gradually reduced greenhouse gas emissions. I am convinced that we can do it and we can do it in a way that incentivizes a capitalist free enterprise system.

Even though McCain lost the 2008 election to Barack Obama, he continued to rally support for the policy in the Senate. But with Obama in office, oppositional politics took over. And industry, seeing the real possibility of a climate law, ramped up lobbying. The conversation took a dramatic turn.

The jobs will go to China and the economy will go to hell. Wake up, America. There hasn't been any global warming, which is what we heard over and over and over again. There hasn't been any global warming for 10 years. You had all of these years of effort and really what felt like forward momentum that came to a screeching halt, or at least that's what it felt like at the time. And that's really where United's story begins.

By united, Heather means Advanced Energy United, the trade association she now leads. The idea for building a new multi-technology trade group came in 2010, after the Waxman Markey Cap and Trade Bill failed. It was a big blow to industry and advocacy organizations that had put all their attention and resources on federal action. The failure was really a wake-up call for many of us in the industry, myself included. And if we couldn't get Washington, DC to act.

Then we were looking and seeing states and regions were creating energy markets. They were shaping the rules of the road. And you saw billions of dollars of energy investment decisions being made annually. States are often called the laboratories of democracy. And that is definitely true in clean energy, where so much of the momentum has come from states experimenting with policy to meet their unique needs. And so United was built from the start to go all in on states and regional markets.

There's really no substitute for that sustained engagement, right? You have to be on the ground, you have to walk the halls, you have to build the relationship. And you also have to really show up with credible information. You're a trusted resource before you're in the thick of any particular fight. And so that was incredibly powerful in terms of. Allowing us to kind of break through and elevate our issue and agenda. And so taking that to heart as we've moved forward in the years.

I'm Stephen Lacey. This week, a conversation with Heather O'Neill, the CEO of Advanced Energy United, about a new playbook for scaling clean energy at the state level. It was recorded live as part of Latitude Media's Frontier Forum series.

The Trump administration has declared war on clean energy, but state leaders are still looking for practical solutions to fast-rising demand and an affordability crisis. I talked with Heather about a new policy playbook that can help clean energy meet the moment. And it is very much about centering the conversation around three really simple principles. Build it, make it flexible, and make it affordable.

So let's fast forward to now. Um post big beautiful bill, there's you know, they've accelerated some phase outs, they've maintain some credits, uh, but there's you know new onerous regulations for manufacturers and developers and it it's very it's very messy.

Um and meanwhile the federal government is is sort of using systematic chaos to make it harder to build clean energy. And so l so many people in the industry are just like asking, where do we go from here? So the blunt question for you is, where do we go from here?

And you probably have guessed the answer to this already from my answer so far, but it to me it's a no-brainer, right? It's states and regions. And so My call to action for our industry is that we have to invest heavily and aggressively now in states and regions. And again, I the federal government is definitely making it harder, right? Whether it's HR one or it's some of the new executive orders that keep bubbling up.

Right. They're putting real roadblocks, real regulatory hurdles in in front of our industry and particular segments of our industry. Um, but this is where again I I look to the states and regions, I hear from the teams on the ground daily that there are huge opportunities, right? Opportunities abound across the board in states and regions. And it's not just, you know, defending existing markets, but there are opportunities to really open up new markets and grow.

And I don't think that's a surprise, right? States are where some of our most forward looking and politically resilient clean energy policies have been developed. So states and regions is definitely the way to go. So I wanna dig into some of the specific states and regions and we're gonna get there, but let's just set the stage for the urgency at the state level.

right now. I mean there are a lot of governors who are looking at the affordability crisis and who are very, very concerned There's, you know, the a real concern about I mean a real desire to attract data centers, but a real concern for affordability as a result of the development of those data centers.

There I think there is continued support for clean energy expansion and an all of the above approach at the state level. Um so there's a lot of urgency right now and a lot of new economic forces coming together. How would you define what is Just describe what's causing that urgency at the state level and how are some of those policymakers reacting? Yeah, absolutely. And you've touched on a number of'em, right? We're

seeing electricity costs go through the roof for consumers. And we know that's just going to continue with the effects of HR one, right? HR1 and some of what the administration is doing are going to raise electricity costs for all. So that is both here now and also going to be worse. You've got for the first time in a long time, load growth, right? So increasing electricity demand.

And that's in part right driven by data centers, as you note, that that race around artificial intelligence and the coming wave of electrification, both building and transportation. And then last but not least, you we're all living through right extreme weather events of of all types. And that puts additional stress, right, on our grid, on an aging grid and infrastructure. And so those challenges are here, they're now, they're daunting, they're interconnected.

You know, states need solutions to tackle those challenges together. And so that's what we've teed up in the new policy playbook, which I know we're going to get into. One point on this, because you mentioned governors. So I was just at a governors association meeting last week and energy is front and center for those folks, right? You've got America, particularly energy affordability. So you've got

Electricity bills going up. And as I said, right, that's gonna get worse with what they've done at the federal government level. And so governors are gonna feel that pressure, right? They are gonna need to take really swift action. And I'll give one data point, one example. In Maryland, right, in PJM's territory, customers are seeing their monthly bills increase by up to$20 a month. And so

That governors are gonna have to act, right? They're gonna feel that pressure. They're gonna need to act now. Other state leaders will need to act. And so that's where again, We absolutely have to get our solutions in the hands of state leaders now to meet that moment and address those challenges. Cause if we don't, the wrong solutions will win out.

Mm-hmm. And how do you think that's opening up opportunities for the industry to message? So uh um I think we're well beyond decarbonization. Certainly decarbonization is really important for many state leaders, but the affordability and economic growth.

um issue is front and center, as you said. So um how does that change the way companies go and talk to lawmakers and how does that open up new opportunities in in states where we're not just talking about the cleanliness of the technology, but all these other attributes.

Yeah, this is where, you know, I'm excited. We're we've developed a new policy advocacy playbook and it is very much about centering the conversation. Around three really simple principles: build it, make it flexible, and make it affordable. Right. We need state leaders to focus their energy agenda on speed, flexibility, and affordability.

And I know we're gonna unpack it a little bit more, right? With speed, it's simply about how do we build, right? How do we build more energy projects and infrastructure now? Flexibility is very much about how can we get more out of existing infrastructure. I think there's a lot of untapped kind of juice we can squeeze from our existing system.

And then affordability, as we've been talking about, we know that decision makers are going to have to make investment decisions, right? Our infrastructure is aging. They're going to need to make investment decisions to meet low growth, meet the demands. So let's make sure that those Decisions are smart investment decisions and that we're not masting money on misaligned or backwards looking solutions.

So I think for us in our industry, it's a pragmatic moment. We have a solution set that we know is directly responsive to these challenges. And we need to be in front of state decision makers, articulating our solution set early, often, over and over again.

Yeah, so let's dig into each of those three. Um so with build it. Are we talking about permitting reform or a broader suite of policies? Yeah, we're talking about permitting reform and so much more. I mean, we're talking about including, you know, building transmission, transmission capacity and speeding interconnection of large scale projects to the grid. And this comes out of again talking with our member companies who have low cost resources that they're ready to build.

you know, whether it's large scale wind, solar, storage and the like, and they're not able to deploy, right? They are tangled in red tape, they are stuck in line. And so build it is all about removing roadblocks and the regulatory red tape across a set of issues. So certainly citing and permitting reform, right? So that we can build large-scale projects.

We're also talking about expanding transmission capacity. And that starts with putting advanced transmission technologies to work and then speeding up interconnection by making smart reforms, including surplus interconnection. So there's a lot there and there are a lot of examples around the country that I can dive into. Yeah.

Well I I know that um so I know United is nonpartisan and um you're really committed to working with lawmakers across the spectrum. Um if I just look at what's happening on on the left. However, w you know, historically, um Democrats and progressives have have pushed a lot of the decarbonization policies. What we're seeing is a real reckoning around permitting itself. Like they're saying, Well, actually we we we we rely too much on

government for these strict set of rules and we actually need to focus on targeted deregulation to accelerate building things faster. How are you seeing that conversation play out in some of these states where there is a real uh concerted effort to deregulate in in areas, in particular in energy.

Yeah. I mean, I think for build it, absolutely, right? It is about how do we clear the roadblocks? How do we move some of that red tape? So the coalitions are going to look different in different states. Um, but there are some really great models out there around um permitting inciting reform. So just a couple years back.

Michigan as one example passed really proactive, positive citing reform legislation that's now moving into implementation. And Advanced Energy United, we worked with our member companies to develop a set of citing principles.

Um, that I think became part of the foundation of that legislation. And there are other states where we're seeing those conversations bubble up. So Virginia is one example and Indiana is another one where We were able to have, I think, really constructive conversations about citing reform and made some incremental progress this year with legislation.

Definitely more to do there, but that state focus on accelerating build is incredibly positive. And I think for when you look at some of the principles we're articulating, they should appeal to folks of all political stripes, right? First and foremost, you know, are you protecting landowner property rights, right? So making sure that state and local governmental processes are not kind of impeding local property rights.

And so that again, a very conservative principle. And so I think you're able to attract allies from across the political strap spectrum as you think about some of these crucial principles and reforms. Mm-hmm. So who's doing it best and where are the potential wins coming up? What are the priorities for some of these reforms?

So definitely keeping an eye on on Indiana and Virginia as we go forward and and thinking about Michigan again as an example of a really positive um siting reform. I think another place that's a hotspot that we are hopeful hopeful that we can have really constructive engagement is actually around interconnection and and the interconnection cue and that's PJM. And I will not, I'm sure everyone who is listening

understands very deeply some of the challenges around interconnection and the queue there. So I won't go into that, but You know, when you look at some of those challenges, right, a lot of that needs to be addressed at the RTO level. So we're making sure that state leaders are getting more engaged with their RTOs, right? To make sure that that interconnection process.

is in line with what states are expecting and need to meet low demand. And so what we're seeing in PJM, right, is you have governors, again, both Republican and Democrat. Really engaging in PJM on necessary changes and asking good questions. How can we clear this backlog, right? And really making sure they have the information they need to make sure that PJM is working to reform what is clearly a broken process there.

Um so when we s talk about making it flexible, what are some other market reforms that we're targeting here? So when I think about making it flexible and you know, I think There everyone persistently undervalues just how much more we can get out of existing infrastructure. And in part that's because the pace of innovation here is really dizzying. When we talk to decision makers, they're definitely not fully aware of the breadth of flexibility options that are out there and ready to scale.

And so again, when I think about our companies creating innovative new products and product offerings, right, you've got virtual power plants of all stripes, sizes, shapes. And the like, you've got companies using EV fleet batteries as mobile grid assets. Or on the transmission side, you've got advanced transmission technologies of of many flavors. So so many flexible options out there that we need to put to work. And again, this is where States, I think, are experimenting, we're seeing

Then pick up a number of what I would call no regrets strategies and policies around making it flexible. So In Virginia, we passed legislation earlier this year that'll accelerate VPP pilot programs. And in California, as everyone knows, that legislative session is ongoing. And so we have bills currently moving through the process that we're sponsoring that would help accelerate VPP development. And really again get the most out of existing and new distributed resources. And in a state, Texas.

We were able to pass energy waste reduction legislation earlier this year. And that requires state agencies to really work together to get the most out of demand flexibility and demand response programs. And I really like this particular model because it recognizes the value that those solutions have for both grid reliability and affordability.

And then last but not least on the transmission side, I think advanced transmission technologies are really having a moment, right? And we know we need to build. new transmission, particularly interregional transmission. And in the meantime, again, getting more out of our existing infrastructure, let's put advanced transmission technologies to work first.

And so Advanced Energy United has worked in multiple states to pass legislation that does just that. So California, Massachusetts, Virginia, and then this year, New Mexico and Connecticut. So again, really having a moment, we see a lot of momentum on advanced transmission technologies as one example.

And now we have a lot of utility comfort with VPPs. Uh there have been you know a number of utilities who've really gotten their uh operations teams uh comfortable with operating these resources and they can provide

Valuable flexibility. And I've heard them described multiple times as now they're they're considered painkillers. Instead of vitamin pills, they're painkillers. Jigger Shaw was talking to me last week and described them as such. And I've heard folks in the microgrid space development. d describe them as as painkillers. And you know, now that we just are desperate to open up more grid capacity.

Um, we have all these resources on the grid that like it is truly the perfect moment for VPPs. Um, talk about like how that is actually changing the way Policymakers are considering these resources and utilities. And then maybe if there are any other specific um market reforms that you want to go into that could help accelerate th those resources. Absolutely right. I think VPPs are also having a moment right for the last

couple of I feel like last year you could not, you know, turn around without hearing something about VPPs. And they're incredibly powerful. Right. And I think you're absolutely right, right? Utilities are seeing a real opportunity here, right? As they think about, as they're looking at the affordability crisis, right? They're they're as concerned as anyone about rates going up, right?

And everyone wants to meet the moment of load growth, right? Find me a state leader who doesn't want to attract new manufacturing, right? Who doesn't want to attract a data center. So you want that economic growth. And so how do you meet the moment? And VPPs play a key role in that, right? Because it it enables you to help kind of shape and shift that load. So, you know, you're not having to build out more expensive.

fossil infrastructure, right? Where you can really take these low cost opportunities and really add to the flexibility of the grid. So we're just seeing, again, I think a real appetite. But we're also at the very beginning stages of the conversation in many ways, right? The fact that in Virginia we're talking about a pilot program around VPPs, right? So I think we're at the kind of

tip of a curve, if you will, on VPPs. And we're gonna see them just, I think, really take off in terms of scaling up in the coming years as they're just a a really good No regrets answer to some of these really big challenges. And then broadly in the flexibility category, are there any other rules or regulations that are in play right now that people should know about? I mean, I think there's always rate design issues, right? There, there are any number of um

regulatory decisions and conversations that are taking place. You've got, you know, New York, um, the PSC there, the grid of the future proceeding that's got a number of of attributes again that'll really help on the making it flexible. You've got Colorado, who's in the last couple of years passed some, I think, really important um

uh distribution system planning, VPP, all the rest, many kinds of rate design elements that are coming into play. So again, I think there are regulatory proceedings across the country in a number of different states where you're seeing regulators start to recognize the importance of whether it's rate design or putting VPPs to work, getting more out of the existing grid.

So then those two feed really nicely into making it affordable. Um that is means encouraging a lot of different kinds of resources. Um, what are the crucial priorities, policy priorities for tackling affordability specifically that you're focused on? Yeah, I think the the beauty of of making it affordable is right some of what I just touched on, as you said, right, really help.

hit affordability as well. So if we're accelerating interconnection so we can get the lowest cost resources online quickly, that's going to tackle affordability. All of the grid grid flexibility targets, programs, rate design, right, managed charging of EVs, all of those save customers money. So again, I think there's there are a number of policy solutions that we've talked about and that are in play in states that are in that affordability camp.

But we also know that, you know, right now regulators and state leaders are considering making big investments right in fossil. And You know, y you've got affordability challenges. Those those resources are the timeframe for getting those resources built and online is pretty long at this point. A lot of folks have pointed to that. And the prices are going up.

And so we're looking for decision makers to really focus on the solutions that are available now, right, and can help customers manage cost. And so again, in the we know they need to make investment decisions. So are they making smart investment decisions, right? Are we ensuring that utilities are planning and delivering the right types of investment?

And that's, you know, how do we future proof utility spending? How do we help align incentives for utilities productively? And then how can we push states? to really embrace, I think, integrated planning, right? That really gets at regulatory efficiency and achieving state energy goals and reliability standards at the lowest cost. So thinking about these efforts. Not in silos, but working together. So again, very unsexy work around utility incentives.

and business model reform and certainly investment questions, but incredibly important as we think about the affordability and reliability of our energy system in the years ahead.

So let's turn back to the state level and talk about how you actually build coalitions in Um, how is it different from a a a national approach? Like when you go to a state house, um, what who are the people you're talking to? How do you actually build a coalition compared to what you might do on Capitol Hill? So I think coalition building in

State houses or Capitol Hill, it's it's probably no different, right? It's just an essential part of the equation and policy advocacy. And it's certainly a core part of Advanced Energy United's values, right? Each I mean the the difference is right each coalition is gonna look different, right? It depends on the issue that you're pushing, it depends on the politics of the day, it depends on who's in leadership, right? All of those.

go into creating and forming a different coalition, but that process really looks the same. And certainly, again, everyone in the policy advocacy space knows this that, you know, Anywhere. is not one organization's, right? You're you're winning as part of a coalition. You may be leading the coalition, you may be on a supporter seat, but you absolutely are working hand in glove with other interests. And again, it just depends on what the issue is.

And I think one of the themes that we've learned, and again, whether it's Capitol Hill or it's a state house, there's just no substitute for sustained engagement. You can't parachute in, right? You have to walk the halls. You have to build the relationships and get to know the dynamics and the allies and the opposition in person.

And that's why at United, you know, we've got team members and state capitals across the country, right? That's just essential if you're gonna create that coalition and move your agenda forward.

Any advice for people who are operating clean energy companies right now who are thinking about what do I do? What pri I'm obviously they're operating in certain states, they kind of understand the policy priorities, but like When they are looking for how to get engaged, what are the ways they can do that? So you know what I have to say here, which is join advanced energy united.

So I states are a dynamic environment, right? You you like DC, you have to know the players, you have to know the issues, you have to know the issue environment and the politics of the day. And You also can't just focus on one venue or lever. So you have the governor's office and their team. You also have what I refer to as, you know, agency alphabet soup. And that includes public utility commissions, right? That are making those.

billions of dollars of investment decisions annually. And of course you have state legislators. And so all of that taken together is incredibly complicated. And then you multiply that by multiple states. Really complicated. And so that's where we can help, right? We're on the ground. We have those relationships. We can introduce. companies, innovations, technologies as part of the solution set to decision makers. And so I'd say help us help you.

We're at such an interesting moment where um governors, utilities, uh regulators, policymakers, um developers, data center developers, they're like desperate for solutions, consumers. Um like we are this is a period of of real desperation to try to get as many resources developed as we we can um for positive economic reasons. So we we think about historically we have led with decarbonisation and cleanliness as I as I s talked about before.

Like is this a better framework now? Like do you think this is ultimately that that there are more tailwinds for this broad set of resources than ever before? I think it's an interesting moment because yes, uh a hundred percent what you say, but I also think the moment is fraught, just given all of the attacks from from this administration. And so it's it is one of those moments where

I do think we have an opportunity because we are leading with a solution set that is directly responsive to those challenges. Right. Again, when when we're talking with governors. They're hair on fire about energy affordability, right? And and they and they need to be. And we're all concerned about grid reliability, right? Utilities, decision makers, everyone. And so you you have

Really, most states facing very similar challenges in the affordability crisis, reliability, and again, wanting to attract economic development and growth. And so I feel really good about us being able to show up and have a solution set, right? That is really directly responsive to those challenges. So yes, I think we have a moment.

Where we can lean into our solution set and we're able to get decision makers' attention because it is this extremely urgent moment with these challenges in front of us.

So I guess the best way to execute this playbook is for, you know, companies here to join United, but let's just um is let's say you've handed them this playbook, right? Whether they join United or not, you've got this playbook. What should a company do with it in hand? How do they think about implementing this messaging strategy into their state level engagements? We'd love to see folks pick it up, right? Whether they're part of United or not. I think this is just

An effective way of speaking to decision makers, right? Making it clear and simple and cut and meeting the moment. And not every company, not every solution in this playbook is gonna fit every company, right? Different companies will gravitate towards different portions that are more relevant for them, for their business, for their business model.

So we hope that folks pick it up and use it as they see fit. We're definitely seeing it already, I think, start to resonate, right? Because it is so clearly addressing. the challenges that decision makers are facing. So I hope that folks pick it up and use it far and wide. Well I mean I couldn't agree more with the messaging. It is very much in line with what I am hearing when I talk to

folks at the local level all the time. And when I talk to people in the clean energy industry, this is the stuff that is resonating. So Heather, thank you uh so much. We really appreciate it. This has been great. I really appreciate the opportunity. Thanks for taking the time with me.

Heather O'Neill is the CEO of Advanced Energy United, the industry's only business association built to shape state and regional policy. If you want to download United's new policy playbook guide, You can find a link in the show notes or go to advanced energyunited.org/slash playbook.

This is an edited version of a Frontier Forum, which was recorded live in front of a virtual audience. We took lots of questions, and if you want to go deeper, you can watch the full video at latitudemedia.com slash events. Thank you so much for listening.