As we have discussed in previous episodes of the show (like Episodes #73, #177, and #198), state regulators and legislators can be ‘captured’ by the industries they are supposed to regulate and wind up serving those industries instead of the public interest.

Usually, regulatory capture is a form of corruption: The system isn’t supposed to work that way, but certain interests can manage to corrupt it. In Texas, however, that kind of capture isn’t a bug—it’s a feature.

In this episode, investigative journalist Russell Gold of Texas Monthly shares what he found after tracking down hundreds of documents scattered across dozens of offices around the state. Not only does the chair of the Texas commission that regulates the oil and gas business personally earn royalties from some of the very oil and gas leases she regulates, so does her family.

We also check in on the progress that Texas is making—and not making—to prevent the kind of grid blackout that happened during the February 2021 big freeze. And we ask where the limits to corruption in Texas actually are, and how rank and file voters in the state feel about it. It’s a sordid story, but an important one to understand, because it reveals a lot about the power of the oil and gas industry in the US.

[Episode #206] – Regulatory Capture in Texas

Straight talk about the world’s transition from fossil fuels to renewables with energy expert Chris Nelder

News

Clean hydrogen is expected to be an essential pathway to decarbonizing the economy. The US Inflation Reduction Act of 2022 offered a generous tax credit known as “45V” for clean hydrogen production, but left it to the US Treasury Department and the IRS to define the rules for earning the credit. So they sought input on the rules by issuing an RFI (Request for Information), and aspiring hydrogen industry players, think-tanks, policy advisors, and the public submitted their guidance. After the proposed rules were issued, tens of thousands of additional comments were filed. A final comment period on the rules ended on May 10.

Eric Gimon of Energy Innovation, a San Francisco-based clean energy think tank and a major contributor to the 45V discourse, previously discussed their guidance for the IRS in Episode #192.

In this episode, Eric rejoins us to discuss the proposed final rules, and their team’s comments on them. On the whole, they are optimistic that the rules will spur robust investments in the burgeoning US green hydrogen sector. With potentially hundreds of billions of dollars in tax credits on the line, it’s important to get the details right, so we explore them in depth in this 90-minute discussion—which earned a rare off-the-charts Geek Rating of 11. We also address concerns and criticisms raised by prospective hydrogen producers whose projects may not align with the new regulations.

[Episode #224] – US Hydrogen Tax Credits

The dialogue surrounding so-called 'just transition' initiatives in the US has primarily focused on the workforce: How can communities reliant on well-paying fossil fuel sector jobs find new opportunities for those facing unemployment? Are there state or federal retraining programs available to facilitate their transition into new roles? Moreover, what industries can offer new, equally good jobs?

What hasn’t been studied nearly as much is the fiscal impact of losing industrial activity related to fossil fuel extraction, processing and delivery. How much public revenue is really at stake in the energy transition? Which states face the highest jeopardy? And how can communities dependent on fossil fuel revenues navigate their transitions while continuing to support essential public infrastructure, such as schools and libraries, once these funds dry up?

In today’s conversation, we speak with an expert who has studied the fiscal impact of the energy transition extensively: Daniel Raimi, a fellow at Resources for the Future (or RFF), an independent, nonprofit research institution based in Washington, DC. Daniel shares with us the results of his extensive, on-the-ground research into the fiscal implications of the energy transition for communities that derive a large share of their public revenue from fossil fuel industries. We also talk through a number of ways fossil-fueled revenues could be replaced by clean energy industries and other policies. We consider the importance of green industrial policy in the equation, and we wrap it up with a speculative discussion about the destiny of fossil fuel communities in the net-zero world of 2050 that we’re striving to reach.

[Episode #223] – Fiscal Implications of the US Transition

In this final episode of our three-show miniseries on green industrial policy (Episodes #220, #221 and #222), we look at it from the perspective of an economist who has written a book on the subject and advocated for it in the EU.

Dr. Alessio Terzi is an economist with the European Commission who works at the intersection of academia, policy, and think-tanks. He is the author of numerous articles in major news publications, as well as a book, titled Growth for Good.

In today’s conversation, we discuss why technological transformation is the essential pathway to solving our climate problems, and how integral capitalism and growth are to that process. We explore the concept of degrowth and some critiques of conventional capitalism, along with ways that capitalism can be adapted to answer the climate challenge. Finally, Dr. Terzi presents his "blueprint for green capitalism," offering a nuanced perspective on leveraging economic tools to foster a successful energy transition.

This episode is a thoughtful, 90-minute excursion into economic theory and green industrial policy that aims to answer some of the contemporary questions about the wisdom of using the tools of capitalism and growth to make the energy transition successful.

[Episode #222] – Green Industrial Policy

What causes inflation? And how is it connected to the energy transition?

Standard business press narratives often discuss inflation as if it has a mind of its own, seldom exploring its root causes. However, the connection between inflation and fossil fuel prices is both undeniable and significant. In fact, as you’ll hear at the end of today’s interview, endless interventions by the Fed may be an unavoidable consequence of the energy transition, from now until the project is complete.

So why aren’t we having a conversation about how Putin’s invasion of Ukraine ultimately led to your having to pay more for everything, as inflation was transmitted through from fossil fuels to everything else? Why did Congress give us the Inflation Reduction Act in 2022, instead of the Fossil Fuel Reduction Act? And what is the role of the Fed in the energy transition?

In this conversation, climate economist Gernot Wagner of the Columbia Business School rejoins us to help us understand the relationships between fossil fuels and inflation. We discuss why the Fed acts as it does, and we explore the Inflation Reduction Act in the US and the REPowerEU policy package in the EU, and the complex interconnections between monetary policy, industrial policy, and energy policy.

[Episode #221] – Fossilflation

What is the recipe for an energy transition at the scale needed to limit global warming below the crucial 2°C threshold?

Bloomberg journalist Akshat Rathi has identified some of the key ingredients, based on his interviews with ten of the world’s most influential personalities working on climate solutions. In his new book, Climate Capitalism, Akshat recounts their stories and makes a case for how capitalism and the dynamism of the private sector are essential components of the global race to zero emissions.

We take a deep dive into Rathi’s work, confronting the criticisms of capitalism, examining how its varied implementations around the world produce different results, and exploring potential reforms for improvement. We conclude by weaving in some ideas drawn from topics discussed previously on the show, including “command capitalism,” how the energy transition requires long-term planning with a system thinking perspective, and the tension between forces driving for international cooperation versus competition.

It's a thoughtful look at the state of the global energy transition from someone with a front-row seat to the investment flows around the world, and we know you’ll find it an illuminating and inspiring discussion.

[Episode #206] – Regulatory Capture in Texas

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