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Episode 206: State-Level Climate Leadership with Katie Dykes, Commissioner of Connecticut’s Department of Energy & Environmental Protection (DEEP)
Today's guest is Katie Dykes, Commissioner of Connecticut’s Department of Energy & Environmental Protection (DEEP). Katie was nominated by Governor Ned Lamont to serve as the Commissioner of DEEP, and was confirmed on February 20, 2019. Katie previously served as Chair of the Connecticut Public Utilities Regulatory Authority (PURA) from 2015-2018, and as Deputy Commissioner for Energy at Connecticut DEEP from 2012-2015. Katie also served as the Chair of the Board of Directors of the Regional Greenhouse Gas Initiative, Inc. (RGGI) from 2014 to 2017.
I was looking forward to this episode, as government is not an area where I historically have been particularly strong, but it's so important for tackling a systems problem like climate change. And it's not just the federal government, state governments really matter as well, and Katie's in a key role, in a key state, doing really interesting things. This is a great opportunity to learn about how someone in Katie's shoes thinks about setting priorities for the state, getting things done, what form the transition should take, what role the federal government should play, what role the states should play, what some blockers are to getting things done, and how they can move faster. We also have a great discussion about how the private sector fits in, and the roles of technology and innovation. Enjoy the show!
As always, please consider giving us a rating or leaving a review. We heard that helps spread the word about our little show and engages more folks in the climate fight!
Jason Jacobs: Katie, welcome to the show.
Katie Dykes: Well, thanks so much for having me. It's great to be here.
Jason Jacobs: I was relieved to hear, when we were chatting briefly before we hit record, that you feel as much like a fish out of water when talking to a start-up person like me as I do when talking to a government person like you.
Katie Dykes: I think we're going to solve some major challenges in terms of the employment and implementation of climate solutions, getting to know what these challenges look like from each other's perspectives. [laughs]
Jason Jacobs: I've been in small high-growth technology startups in and around my entire career. And until starting to focus on climate a few years ago, had just spent basically no time in the policy world, either the federal or state or local. And so I've been pushing myself to get outta my comfort zone and spend more time with people like you because, to solve a system's problem like climate change, you can't avoid it. It's an essential part of the equation. And then so many of the companies that we work with, policies very important to them in their future success.
So, really honored to have you on the show and thankful that you'll make the time to help me learn and to help our listeners learn more about what is going on at the state level, policy level, and the, and what your world looks like.
Katie Dykes: It's interesting. I'll just share just personally. I learned about your podcast with my brother who's worked in tech startups in Boulder for most of his career. And you couldn't imagine on paper, more different professions. I've worked in government my whole career. He's worked in startups.
I think there's some real similarities, maybe that's a place to start, that might surprise. And particularly working in state government, you get this kind of Foxhole comradery with a small team. Working in state or local government, we have to be very scrappy, very creative. We're always thinking about policy from a problem-solving perspective. We're usually under-resourced. But we're very motivated to tackle really exciting problems and figure out how to scale effective policy solutions.
And so when I talk to my brother about what he enjoys about the startups that he's worked with, I think there are a lot of the similarities in the culture that can occur between state government and startups. Which maybe is surprising to hear that. Most people think of government as like just some giant, immovable, kind of opaque bureaucracy.
But in Connecticut, where I work at the Department of Energy and Environmental Protection, we have changed, and stretched, and grown so much, even over the 10 years that I've been with our department as we've been tackling new iterations and evolving challenges of the climate crisis. And so it's been really exciting to see what we're able to get done. And it's been a, a really dynamic place where I've learned a lot and had a great experience.
So if nothing else, you can... Make no mistake, this is a legitimate pitch for listeners to consider working in state [laughs] government. Which may not be on the top of everyone's list, but I think anyone considering working in climate change should take a look at.
Jason Jacobs: Now, I was listening to a talk that you gave, I think it was in 2014. And you were talking about the origin story for the agency. And it sounded like essentially there was an organizational change to create the agency where, I think the analogy you used was, the federal level if FERC, and the EPA, and the DOE became one. Can you talk a little bit about both what the agency does, but also maybe some of that origin story, just to frame for listeners, from what perch you sit.
Katie Dykes: Our agency is really kind of creative. Like you said, this amalgam in 2011, um, taking the Department of Environmental Protection and the Public Utility Commission and a state energy office and kind of merging them all together.
The theory at the time, which I think is really born out is that, look, you can't really respond to and tackle challenges like climate change if we're operating in these silos. We think about deploying clean energy, for example. You need to make sure that you have the permitting and the sighting aligned so that you can have predictability and, and efficiency in getting projects built.
Where you have the utility commission, traditionally, utility commissions have been focused on reliability and affordability, uh, the delivery of electricity service. But it's really critical today to make sure clean and de-carbonization and, increasingly, climate resilience are also part of how we're planning for investing in our electricity systems.
So that was the goal, is to try to bring all of these different pieces together so that we could have more comprehensive and holistic policies to tackle challenges like climate change. And I think it's been a real success in our state.
Jason Jacobs: And in terms of your origin stories, at what point did you become interested in climate? And maybe talk a bit about your professional journey that led you to where you are and, and how those worlds came to intersect?
Katie Dykes: Well, I grew up in West Virginia originally. My mom was an environmental science teacher at my high school. So I think I was kind of destined to have an interest in the energy sector x in the environment. I remember I, I volunteered to be Walter Mondale in the second grade mock presidential election. And I ran on a platform about cleaning up chemical pollution in the [Canal 00:08:55] River.
So after getting utterly destroyed at the elementary school polls, um, [laughs], I eventually went on to Yale to undergrad. I studied environmental science and history. But continued to be really interested in energy. And I went to Mongolia for two years after college. Worked on wildlife conservation issues in Mongolia. It was really dynamic experience. And then back to Yale for law school.
Jason Jacobs: I don't know the detail, but I feel like that's an understatement. [laughs]
Katie Dykes: It was a ton of fun. I mean, I was working on policy issues. I got to get a law passed in the Mongolian parliament to help address hunting. There was a lot of, uh, legal fur trade that was going on. And, you know, it's very different from the challenges here. There, it was like trying to get everyone to buy into the rules and buy into a system. Here, we take that for granted. But at the same time, in a lot of the political and policy work that we do here, sometimes it can feel like we've got these trenches that just never move.
Anyway, I came back to the U.S. I went to Yale over law school and wanted to work on, uh, energy and environmental policy. I got My Climate break working at the U.S. Department of Energy during the Obama administration's first term. Spent a little time with the Council on Environmental Quality, which is a White House office there doing more environmental policy work.
And then I got a call about a role here in Connecticut. And something really appealed to me about the idea of being in a, in state government. A little smaller scale, but a little closer to the ground, to a place where you can really get a lot of autonomy and opportunity to have some leadership opportunities earlier in your career. And be close to that feedback loop of the political and legislative process. Interacting directly with businesses and citizens, with rep peers. Get a real sense of what's connecting and that sort of trying out different policy levers to help address climate change.
And so that's where I've been for the last 10 years. It started off in a deputy commissioner role for energy. And then had the privilege of being the chair of Utility Commission for two and a half years. And then the last three and a half years, I've been serving as the commissioner of our Department of Energy and Environmental Protection.
Jason Jacobs: There's so many different ways we could jump in here. What I'd like to do is just start with, given how broad the mandate is of your agency, it set sounds like, and correct me if I'm wrong, that you need to balance the long-term de-carbonization with also making sure that these critical services are available and reliable along the way.
And on the one hand, if you're looking out for the collective good, I mean, gosh, we need to solve our, you know, our missions problem and all the pollution that's in the sky 'cause we're in for a world of crap, but on the other hand, if you do so in a way that inhibits people from heating their homes in the winter, for example, and people are dying because they're freezing to death, elderly people in their own house, as an example, then we can't let that happen. So, first, did I get that right, that those are both your responsibility? And how do you think about and manage to that tension?
Katie Dykes: You're absolutely correct. I think when you're working in roles like this, you have to constantly balance, is it affordable? Is it reliable? As well as [laughs] is it getting us where we need to go in addressing carbon emissions? That question is coming up constantly. People are most familiar with it in the electricity with the electric grid.
But it's also a big issue when we talk about other kinds of infrastructure. Our department is involved in, how often do you rebuild a wastewater treatment plant? How frequently are you changing out a furnace in someone's home? Every day that goes by that a customer, a town is making a decision about replacing that type of equipment as we look at the IPCC report, we know it's really important to make sure that we're helping to make carbon-free and resilient infrastructure as affordable as possible today so that we can avoid having to retire dirtier infrastructure or equipment in the middle of its useful life.
But those are tough choices. Just think through after two and a half years of, of pandemic. All of the kind of whip sawing that we've seen in terms of economic challenges that folks have been facing. These concerns around affordability and energy costs are front and center. It makes it a great time for us to talk about high heating oil prices, we heat with a lot of oil here in Connecticut, as well as high gasoline prices.
You know, the value opposition for an electric vehicle, right? [laughs] or a heat pump has never been better, but at those precise moments when affordability could be a real driver for a consumer to take action, we need to have done the education and that contractor outreach so that these solutions are well understood and that contractors know how to deliver them at the moment. And that the supply chain is there at the moment that commodity prices suddenly make that affordability value proposition compelling for customers. Those are some of the real [laughs] challenges that we face in trying to spur adoption of clean energy and de-carbonization solutions.
Jason Jacobs: With the caveat that we already discussed, that I continue to know very little about your world, but from the cheap seats, there are some other things to balance as well. And one of them is, I'm saying this like a statement, but I'm really asking it like a question, is there's carrot versus stick, versus just having a more desirable portfolio of options that happen to be cleaner.
There's balancing what's optimal with possible given the current political climate. I mean, there's like de-regulated and regulated and different mixes of options in each region and also different natural conditions, like the wind blows differently in different parts of the world, or there's natural resources under the ground that are different in different parts of the world or different regions of this country.
And then the populace is different in terms of there's different perceptions of nuclear, for example, in different parts of the world that aren't necessarily rational, but show up at the polls. And so where do you even start when defining agency priorities?
Katie Dykes: Well, first you start with good planning. We need to know what are the goals that we're reaching for. We have long-term targets s- set and statute reductions that we need to achieve by certain time period. And we do a lot of planning and modeling on the electric grid, uh, to look at all the different mixes of different types of technologies that could help to get us there. But what will ultimately went out, which technologies ultimately will make the most sense for deployment can depend on some of those unique situations or unique characteristics of politics or the geography or the landscape of any individual location.
Working in a role, uh, like the one that I'm in, you have to have your ear to the ground all the time. You have to be talking to stakeholders, talking to legislators, trying to figure out what is going to catch on. What's gonna have broad support so that you can kind of minimize the friction and help spur adoption of things that really fit the particular jurisdiction that you're working in.
But I think this is one of those questions that comes up a lot in terms of what's the role of government in helping to spur deployment. [laughs] We can look at some of the successes that we see. What's really taken off over the last couple of years? Offshore wind, solar, energy efficiency. I mean, these are-
Jason Jacobs: Is this Connecticut specific that we're talking about right now?
Katie Dykes: Certainly in Connecticut, but if we look what's really been successful across a lot of states, let's take solar, for example, we've seen a dramatic decline in prices for solar. And why is that? Partly, it's federal investments in supporting technology and entrepreneurs and, and universities investing in R&D, but federal tax credit have been incredible accelerants. So have power purchase agreements that have been supported by states directing utility purchases and, and, to some extent, corporate purchases.
Those have been really successful levers of like driving adoption. And as a consequence we've seen demand increases at prices have been coming down with supply chain consolidation and innovation. And that's been an incredible success story. So how do we kind of rent and repeat that cycle? We've seen the same thing happen with offshore wind. Just a couple of years ago, I had advocates, you know, saying, look, offshore wind is gonna be a major contributor to Connecticut meeting your de-carbonization goals. And I was like, have you seen the prices [laughs] for the Cape Wind Project that Massachusetts was looking at at the time? And, and now it's just been shocking.
Like every time we do an RFP for new power purchase agreements for offshore wind, the prices are continuing to tick down and down and down. And it's just another example of that cycle of tax credits, PPAs, R&Ds, supply chain consolidation, and critical mass of lots of different states getting into the offshore wind space that's helping to drive down prices. It's delivering clean energy jobs. It's helping to build out, um, infrastructure, investment opportunities around ports and around fabrication of turbines and components. Those are all the kinds of features of a clean energy solution that will light up the politics [laughs] and light up the political and community support to drive adoption.
So that's one path of success that we've seen where something that we're doing at the state level with having targets and renewable portfolio standards and RFPs for power purchase agreements, I think has been an important component along with the federal tax credits and those other pieces to help deliver significant megawatts and de-carbonization at a lower and lower cost.
But there's other paths. Think about the LED light bulb. [laughs] That's another great success story. Absolutely phenomenal. It's been the workhorse of energy efficiency programs over the last decade or so. Connecticut is pretty similar to many other states in having utility administered energy efficiency programs that are funded by, uh, surcharge on utility bills through those programs. A lot of the savings that we've gotten have come from lighting measures, replacing incandescents and even CFOs with LEDs.
And the pieces of the policy puzzle are that we had the federal standards in place, the client standards to help phase incandescents out of the market. At the same time, through our utility administrative programs, we've been issuing rebates or even buying down the retail price at the point of sale. That's helped to make LEDs ubiquitous in our state and drive customer adoption of a technology that a couple of years ago is like a little confusing to people. The quality of the light different. We have to explain lumens versus watts. There's this whole kind of consumer adoption challenge that we had to get over you.
And I could look at an LED and say, oh, this LED is gonna cost 18 times what an incandescent bulb is gonna cost, but it'll last 40 times longer, hypothetically. So I should pay $25 for an LED [laughs] because I know I'll make that up over time. But for the average consumer standing there at their big box store, thinking about paying that amount of money for a, a light bulb, it, it's hard to have that conversation about the cost effectiveness.
So providing those upfront rebates to buy down the retail price has been critical to getting LED adoption across the market in our state and getting those savings. But now they're ubiquitous, which means we need to move on to the next solution that we can fund. This is the same kind of trajectory we need for electric vehicles and for heat pumps.
So I think all of this illustrates that where we have federal policies, regulatory supports that can help spur R&D investment and drive adoption through tax credits standards and so on, that's great. Then states come along and we have dollars to invest into position through PPAs and through efficiency programs.
But then we have to get over the hump of consumer adoption. And it's one thing to look, think about the adoption process for offshore wind turbines, [laughs] which are planned through utilities and RTOs, and, you know, involve a, a more defined set of stakeholders. But when we're talking about electrification of transportation or building heating, now we have to have an approach that will work for mass consumer adoption. And that's a really different ballgame, but it's one where I think startups and private sector supports can really help us break through and think about how to market, market those types of de-carbonization solutions effectively
Jason Jacobs: When it comes to that consumer adoption piece, what lessons have you learned so far? And which pieces of that do you feel like are pieces that the agent see or the state should be taking on yourselves and where do you need help? And how do you see that help integrating with your efforts since, as we talked about at the beginning of, of the discussion, it's like two different worlds?
Katie Dykes: You may be familiar with this book, Crossing the Chasm.
Jason Jacobs: Yeah. I read it a long time ago.
Katie Dykes: So my brother from startup world was like, oh, you should really take a look at this. I found it really, really fascinating because this idea of thinking about how you get adoption of technology or a climate solution is gonna look different for your first, the early adopters versus... Right? [laughs] other segments of your market that are coming along later.
We don't really talk about that or thinking about that enough in policies phase in government, but I think it's absolutely true. We often think about what will drive adoption from our own kind of perspective of like, is it cost effective or, [laughs] or is it gonna help save the planet? But that might not be the thing that's the most motivating for most customers who are most businesses or citizens out there who might be con contemplating their next car purchase or what to do when their furnace breaks in the middle of the winter.
But what my big takeaway from that book was that there are other values that these de-carbonization solutions can appeal to. For example, a home that's energy efficient, that has better insulation and air ceiling, is gonna be more comfortable to live in. You can eliminate those drafts. You might be dealing with mold issues, or a wet basement, or just aesthetics, or just ha- having more control about the zonal heating and cooling, what temperature your different bedrooms are. Those are things that could actually drive someone to want to purchase a heat pump. They don't have to be the DEEP commissioner who's like so motivated to solve the climate crisis for some citizens, right? They're like appealing to some of those other ancillary benefits of climate solutions could actually be the key to driving adoption.
And so I think that's one lesson I've taken from thinking about how startups and how businesses are approaching de-carbonization opportunities, that while climate may be the motivator, it may not necessarily be the selling point. And we need to make sure their policies are flexible enough to enable contractors and businesses to be able to market those other aspects of their solutions without kind of constraining the value proposition to just the one that makes the most sense from a policy perspective, if that makes sense.
Jason Jacobs: Even in this first part of the discussion, we've talked about so many different types of solutions. We've talked about EVs, and heat pumps, and solar, and offshore wind, and LEDs. And, and then we've talked about what it takes to get them adopted and the costs and things like that, but given how many different types of solutions are out there, how do you prioritize and determine what to put your way behind as an agency?
Katie Dykes: I think a lot of what we do, if we're doing it well, is helping to highlight what's gonna have a big impact, what are gonna be the needle movers, the gigaton scale, if you will, solutions versus things that are not gonna be as impactful. So we can... We're making sure that any, the time that we're spending on, you know, new regulatory programs or dollars that we're investing are going to the things that are gonna have the biggest impact.
Jason Jacobs: Is that modeling that you're doing yourselves? And how should you work with outside firms to help?
Katie Dykes: So we do have the benefit of being able to do a lot of modeling, especially when it comes to planning for the electric grid. For example, we still do integrated resource plans here in Connecticut. And, and we were able to model out different pathways for reaching a 100%, uh, carbon-free electric grid by 2040 with the use of modeling.
So that can be really, really helpful. But again, even the best modeling, it's telling a story. It's presenting options. It's not a perfect crystal ball. It can't perfectly predict what will happen, what technologies will become available, how prices will change, what citing or permitting challenges may make it difficult for one technology to move forward. Or conversely, what types of political or, or stakeholder priorities will help one solution advance faster than another.
I think the modeling helps you understand the relative impact of different options, but then you have to really have your ear to the ground to figure out what does the policy opportunity look like any given solution at any given time.
Jason Jacobs: And when it comes to solutions that you do choose to engage with, is there a certain stage in their life cycle that tends to be the kind of the baseline or the earliest entry point that you would come in or typical? And also, what types of risks are you okay with taking or unknowns? And then what types of risks or unknowns are non-starters for you?
Katie Dykes: Well, anything we're talking about with respect to the electric grid, we have to assure that it's going to be reliable. We can't compromise on that. And of course, through interconnection processes and whether the utility level or for the regional transmission operator, I mean, our utilities are on the hook to make sure that what they're interconnecting and what they're relying on to supply electricity is going to be reliable. So that's a must-have, a critical filter.
I think there's more that we could do from the government side, uh, whether through utility commissions or state agencies to create an on-ramp or more of a test bed for new technologies or new services to prove out, to reach some level of scale and to have some revenue certainty and predictability to help them get off the ground. It's just something that we haven't been as successful at, but I think something that I hope we can do better and do more of going forward.
There are some places that we have, through grant programs, the ability to, to dip our toe in the water and yet the feel for different things in government. So, for example, we started, uh, almost a decade ago, the first, uh, statewide micro-grid program that, I think at the time, we've invested in, um, nearly a dozen different micro-grids all around the state that can fully island from the grid and the event of an outage.
And there was some really interesting kind of in engineering challenges that we work through with our grantees to help to make sure that those micro-grids could perform effectively. And that was a great example of creating through a grant and an opportunity to develop a project, design a project, work with engineers, test it out, and ultimately prove out a model that could be scaled.
Another example is our department of transportation has been in the lead in electrifying their transit buses. Doesn't sound like rocket science now, but, [laughs] you know, several years ago when they were first getting started in this space, there were a lot of questions that had to get resolved. The, how would the DOT integrate the charging into their depots? What were their heating load, you know, look like? [laughs] Can they run over the bridges on their roots, um, handle the weight?
These are examples of public investment integrating some of these climate solutions early, gave us the opportunity to test out, you know, address some of the challenges, and as regulators to learn about what those challenges are for a customer like the department of transportation has given us a lot more insight to think about how to position rebates or grants for private companies that want to shift their trucks, or buses, or heavy, medium and heavy duty fleets over to electric solutions that, hey, we need to wrap in some technical assistance, or we need to provide funding for charging infrastructure at the same time that we provide a rebate for the purchase of the vehicle. Those are the kinds of insights that we got from testing out that adoption in a public sector context.
Jason Jacobs: And can you talk a bit about your specific de-carbonization goals? And then going through those pathways that we are discussing, which are the aspects that you feel very confident about, and then which are the ones that are keeping up at night, or that are most unknown in terms of how they'll be addressed?
Katie Dykes: As we talk about decarbonizing the electric grid, I think, clearly, we have a lot more a certainty today and confidence about the ability to scale renewable development. And I would've said 10 years ago, given how prices have come down for those technologies. And the category of challenges that are significant, but I think solvable transmission is, one, we need to build out a lot more transmission in the Northeast. And we should integrate the offshore wind, but also to make sure that when we plug it in to the grid onshore, that we're not going to dump a bunch of power into a location of the grid that can't handle it, and then have unintended consequences lik having solar and other onshore renewables trip offline.
So transmission is another. It's got sighting challenges. We have to figure out how we're going to pay for it and split the bill among our, the other states in our grid. The other challenges in terms of what's going to keep the lights on when the renewables aren't operating. It's been great to see all of the attention, I think that's being paid to that in more recent years, whether it's through the federal bipartisan infrastructure law with focus on things like hydrogen incentives for grid resilience to help support storage, demand responses, and other, uh, critical solution that can help to balance loads and us to manage our demand with the integration of more variable renewables.
Those are all in the category of, you know, challenges where you can start to perceive what the solution is, but figuring out how we're going to do it cost effectively and how we are going to do it at scale is a lot of incredible work be done as we speak to help to start to [laughs] answer those questions. But it's really urgent, Jason, because, I'll take Connecticut as an example, we have a lot of oil-fired power plants located in our state. If you can believe it, many of them were built before the Clean Air Act. And so they're grandfathered [laughs] from air permits. And they're generating enormous amounts of air pollution in communities of color and low-income communities, you know, affected from an environmental justice perspective.
And as we build out more and more renewables, we could have the perverse effect of having to run those oil units more [laughs] to maintain reliability when the sun isn't shining, when the wind isn't flowing, especially in the wintertime. It's really critical from, not just a de-carbonization perspective, but also from an environmental justice and equity perspective to be investing in those kinds of emission-free resources that can balance that loads and integrate and maintain reliability when the renewables aren't operating. And so that's why this is such a compelling challenge to work on. And it's been great to see so much more focus and interest on, on those types of solutions.
Jason Jacobs: Can you talk then a bit about the roles of nuclear and natural gas, individually in the short meeting in long-term in Connecticut?
Katie Dykes: So we've been spending a lot of time on those issues as well. Connecticut is the host to the largest power generator in all of New England, and it's a nuclear facility that's located in the, uh, southeast part of our state. A couple of years ago, we entered into a long-term contract with that nuclear facility 'cause we've been realize it was at, in danger of shutting down prematurely in part because it was being out-competed by natural gas power plants that could access low-cost natural gas and it's really helping to bring down energy prices. Um, but that was hurting the competitiveness of the nuclear facility.
So we intervened to provide a contract to be able to keep that facility running. Connecticut happens to be a state that is a little more embracing of nuclear, I think, than some other states in the region. In this case, that meant support to keep the facility operating. And had it shut down prematurely, we would've seen the entire, not just Connecticut, but the entire New England region have a 25% increase in greenhouse gas emissions from our electric grid. Not an insignificant [laughs] back slide that would've occurred. It was the right step to take, and helped to give us more options, I would say in, in terms of being able to de-carbonize in an affordable way in our electric power sector.
So just to give an example, we're proud to be a state that has, you know, led on with our renewable portfolio center on investments in renewables and solar and offshore wind. But if we saw a generator the size of our nuclear facility go offline, that's a whole lot more thousands of megawatts of new renewables that we would have to build out. When you think about the land area that would be taken up with developing all that solar or the impacts to our marine environment with gigawatts more of offshore wind, it's significant.
And so being able to keep the right mix of different resources, nuclear, uh, [inaudible 00:35:16] hydro power, energy efficiency, and response storage also helps to minimize some of the sighting challenges associated with a whole lot more renewables. Not to say we aren't a embracing renewables first, but we're getting to a point where the Northeast is a pretty dense region. [laughs] There's not a lot of places to put, you know, things like solar or wind without impacting our forest or impacting developed areas. And so as we run into some of those sighting challenges, it's, it's important to have this kind of balance of resources, I think, in how we meet our de-carbonization targets.
Jason Jacobs: And where does natural gas fit into all of this? Especially as you look into the medium or longer-term?
Katie Dykes: Well, there's some unique challenges associated with gas here in New England because we sit at the end of the gas pipeline [laughs] system for the U.S. I have been pretty vocal in, uh, advocacy with our ISO New England that they built out their competitive market here on a way that is really built around the finance and needs of new natural gas power plants.
Um, but at this point, I think we've invested in, you know... More than 50% of our capacity is, is natural gas, but we don't have adequate gas pipeline capacity to actually ensure that those power plants can access their fuel and run reliably all year-round. We have significant challenges with how we're going to move off of natural gas. We have to move off of natural gas in order to hit our longer-term de-carbonization goals. We have a near-term crisis almost of the gas reliance that we're experiencing today in 2022 is not really compatible with maintaining a reliable grid.
And so I think that's just adding or maybe accelerating the policy need to scale up alternatives to gas in our region. And I think there's broader recognition of that today. And it's just a race to what are the best 10 technologies that we can utilize that can provide for those alternatives and how can we do that affordably.
Jason Jacobs: And a related topic is, given that your agency has so much, it sounds like it's both the techno optimist side with this technology or that technology or incentives or mandates or whatever, but it's tech, tech, tech. But on the other hand, one of the stated goals I think I read was to preserve a certain amount of land and keep it undeveloped. Can environmentalism and techno optimism coexist, or they, it odds with each other? And, and is it a little bit of like you're left and your right hand trying to battle as you're trying to get anything done?
Katie Dykes: It's definitely one of the, I think benefits of having an agency that includes both natural resource [laughs] conservation and clean energy deployment under one roof, is that we are encountering those conflicts and trying to figure out how to work through them every day. Are there positive practices around solar development, for example, to enhance agricultural or pollinator usage or things that can be complementary to the natural environment associated with solar deployment? Are there places we can point to and say this is not a good space for a developer to focus on, but over here, you know, our locations such as brown fields or landfills where we might be, okay, paying most slight premium for the solar if we can ensure that it's gonna be located in a place that's gonna minimize impacts to, you know, natural resource values?
Those are some of the solutions that can emerge as part of working through and trying to address these issues holistically within our department. But I think a lot of it also comes back, Jason, to the importance of investments in things like energy efficiency, the demand reduction solution, what are the alternatives that are out there so that we can help to right-size the amount of impacts on natural resources that are necessary in or- in order to achieve our goals. We wanna do all of the above. Those are definitely significant challenges, especially, like I said, in dense areas, dense regions like Connecticut.
Jason Jacobs: We were talking before about grid reliability. And we were also talking about things like EV adoption. It strikes me that there's a bit of a chicken and egg where, on the one hand, it would be easy to say, well, don't speed up EV adoption because it'll take the grid to its knees and then we'll have a, a reliability problem. But on the other hand, the faster that it's shown that there's consumer demand for EVs the more acute the pain becomes and the more incentive the grid is, you know, the operators of the grid are to their stuff.
How do you manage that tension of not getting too far ahead of yourselves so that the elderly person doesn't freeze in their house without heat in the winter while still incentivizing adoptions so that we clean up our earth faster and preserve long-term planetary health.
Katie Dykes: You know, it's one of the benefits of doing long-term planning like we do in our agency, is that we've been already factoring in and assumed increases in electricity consumption associated with EVs or heat pumps when we've been planning for how much electricity supply and clean electricity supply we need to serve customers in Connecticut.
So we've been factoring that in as we go. And I feel really confident we're gonna be in good shape in terms of providing for adequate supply and reliable supply for those new loads that are coming on. But, you know, the opportunity that I'm most excited about, and I think it's really critical as we see the scale up of electric at vehicle adoption is around charging and the time of day when charging is occurring.
We have [laughs] some of the highest electricity rates in the Lower 48 in Connecticut, which is not the right end of the list to be on, [laughs] but it means that we're really focused on what can we do to provide for more affordable electricity for customers. And one of the opportunities that we have, if you think about it, is by selling more electricity, but in those hours of the day when the grid is currently underutilized.
What you pay for in your electric distribution rates is largely the fixed costs of poles and wires and substations and like a static system. But much of that infrastructure is not being utilized fully all the time to the extent that we see electric vehicle adoption taking off. We have the ability with EVs to incent or time or manage the charging to occur overnight when people are plugging in at home. We could actually see the utilities selling electricity at a time of day that they're typically, [laughs] you know, much lower demand. And at any time they're selling more volume of their product, they can spread out the fixed cost of the system over more volume of sales.
And that translates into lower rates, which is the most amazing thing you could possibly deliver [laughs] as a policy maker, de-carbonization solution that actually could have an ameliorative effect on your electricity rates and your electricity bill. In order to achieve that, we've got to ensure that we are not only building out chargers and helping provide rebates for EVs, EV purchases, but also putting in place incentives for managed charging and time-of-use rates and getting the utilities positions to be able to handle and, and help manage that charging across all of those different EV owners that are popping up around the state.
So that's an example of one of the challenges that has been front of mind here in the state, um, in our utility commission in recent years and in a way that we're, again, trying to balance that stool of reliability and affordability, as well as de-carbonization.
Jason Jacobs: And there's a couple of other tensions with long_term planetary health that I'd love to get your thoughts on. And they're semi-independent, but I guess everything's related, but one is just, on the one hand, you need to always make sure that there's stability and resilience, but on the other, at some point, would you ever sacrifice any short-term stability for a long term planetary health or is that just off the table?
Katie Dykes: Let's just take this example. So two and a half years ago, Connecticut became a state that wanted to phase out the use of single-use plastic bags. And getting rid of single-use plastic bags is like they're bad for the marine environment, they create litter, you know, all this kind of thing. But they're not gonna solve, like they're not a big needle mover, the biggest needle mover in terms of solving our solid waste problem. But there was a lot of like advocacy support and it's became a really compelling kind of issue to ban the use of these single-use plastic bags.
But the policy started not by an outright ban, but by saying we're gonna charge people 10 cents, you know, whenever you purchase a single-use plastic bag. And then after two years, we're gonna shift to a ban. So that's an example of like, how can we get car comfortable with that first policy step and take it to something more?
And one of the things that was really remarkable that the ten cent fee went into a place. And then a couple of months later, the pandemic hit. And at that point we suddenly had to like kind of look at this, uh, how the policy was going. It was surprising, actually, that 90% of people had just start to bring reusable shopping bags two years early in the policy timeline that we'd anticipated. But it showed us that people could adapt quickly to a new habit that policy makers or legislators might have been concerned that they couldn't make that shift that quickly.
Of course, banning single use plastic bags, like I said, it's just one step, but it was visible step. So now the next question is, look, what does that open up? We've demonstrated that we could take this first step with a policy. It creates this sort of consumer adoption behavior changes. How do we translate that momentum into something that will have an even greater impact? So, for example, if we could ban the disposal of food scraps in the trash, now that's a solution, right? If many municipalities did it, developers would be flocking to building aerobic digesters in our state. And we'd cut the amount of garbage that we're sending to incinerators by 40%.
For a policymaker, okay, how do you get on the on-ramp of that? For a municipal leader or legislator thinking about that policy, that feels very draconian, maybe too big of an ask. So we had to figure out what's the first step. Do you get some marque restaurants to do a food waste challenge, to raise awareness? Do you give incentives to towns to set a future ban? You know, these are all the kinds of nudges that can help us get there, but you have to kind of have your ear to the ground to see these opportunities and think about these first steps as a way to communicate why the policy is important, why it matters.
Some of these early-policy steps are just as much about education and raising awareness and giving people permission to try something different, understand the impacts of making a change. And then you can kind of get to that eventual snowball effect where you've got developers investing in new kinds of food scrap diversion technology that helps to make disposing of food scraps in the trash something that just doesn't make economic sense. But this is what we do every single day, I think, is trying to think through how do you get through that adoption curve so that you can get the swing started [laughs] and eventually kind of take that next leap to a more impactful policy step.
I think we surprise ourselves frequently that behavior changes are easier than we anticipate. We don't give our society credit for being able to handle changes, but you have to be very thoughtful in how you communicate and engage people and why we need to make a change, and what first will actually demonstrate success and make it more visible for folks about how something like our waste sector, which people tend to not think too much about, could actually be providing for a more sustainable and livable community.
Jason Jacobs: Last tension. I wanted to just get your take on, and this is less Connecticut specific, although it is relevant for states as well, but just the tension between long-term planetary health and national security and energy independence.
Katie Dykes: If you think back to the beginning of renewable portfolio standards, you know, for Connecticut, we adopted ours in the late-nineties. If you look back at a lot of the legislative history and what legislators were debating when they were thinking about putting in the renewable portfolio standard, it wasn't just about the environment. It was also about energy independence and the possibility that we could be generating electricity from clean sources located in our state that are gonna be employing people here in our state, growing jobs, creating economic development opportunity.
Um, another other major argument for the renewable portfolio standard was that it would create some diversity in our fuel mix. We have been on the fossil fuel roller coaster, if you will, [laughs] you know, seeing big swings and commodity prices over, you know, different time horizons that really hit consumers, uh, pretty hard when we have kind of price volatility. And, and that was another big selling point of renewable portfolio standard was that, you know, the fuel is free for solar and for wind [laughs]. And so it would give us the ability to inflate ourselves against those kinds of price bikes.
These arguments, these benefits of investing in clean energy, in energy efficiency continue to be just as compelling today in 2022 as they were 20 years ago. It's an important accelerant for broader community and policy support for greater de-carbonization. Supply chain issues are gonna be absolutely critical. I'm grateful for all of the federal support and leadership that's being provided to address some of those issues, which are difficult for states to solve on their own, but this recognition of the need for fuel security or insulating against price volatility for energy costs is only going to catalyze more and more support and investment in clean energy, but also shifting to electric vehicles, shifting to heat pumps. Those who can be big drivers for customer adoption for those kinds of technologies as well.
Jason Jacobs: And that's a great segue. I know we're starting to run a little long here, but one last topic I wanted to ask you about is just how much are you just on an island thinking about what's best for Connecticut versus relying on the federal government for support? And to the extent that you do rely on the federal government for support, are you getting what you need from them? And if not, what would you like to see that you aren't getting?
Katie Dykes: This is a really exciting time to be working in the space, working in state government, in part, because of the Bipartisan Infrastructure Law. And all of the [laughs] funding that's coming forward from the Biden administration is acting as an accelerate and a catalyst. We are seeing such a ramp up in opportunities to invest in things like smart grid and broadband and transformative technologies that have significant capital investments. Anytime we can bring federal dollars to the table to help stretch our state dollars, our rate payer dollars further, good things are happening. I'm just so excited about the opportunities that these federal investments are gonna be bringing forward to help really catalyze a lot of the de-carbonization and innovation agendas in our states.
I think the other thing that's exciting in terms of our partnership with the federal government right now is many of the investments that are coming forward in the energy space are focused on things that might not be on the top of a, a state's list. When you think about hydrogen, for example. You know, this could be of very expensive proposition for us to focus on in terms of getting early winds and early deployment of clean hydrogen.
So when we have the federal government putting $8 billion on the table for hydrogen hubs, that gives the states the ability to then solve for many of the other pieces of the hydrogen puzzle in terms of distribution and production and inciting and organizing end users and addressing safety issues. All those challenges of deployment, we can now be working on today because of the federal funding that's in play. Whereas, otherwise, we might be waiting a while [laughs] for costs to come down or technologies to become more ubiquitous before we start tackling some of those deployment challenges.
So I think that's another example of how the ut- incredible federal partnership that's occurring right now, is helping to unlock like more solutions or policy areas that, for states to be focusing on that we otherwise wouldn't be able to.
And then I think the other thing to highlight is regional work. States love working together on multi-state efforts or regional efforts. It's a great opportunity for us to expand our impact. And when you think about our PS markets or the regional greenhouse gas initiative, which we've been part of for many years in the Northeast, so many different examples of how states have banded together to create markets, create kind of uniform products or incentives. And the more we can do that, we know that makes it easier for entrepreneurs and for businesses to invest in the solutions that we need. So that continues to be a really important area of focus for us in Connecticut.
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