▶ 0:17:21Chair Lee: The hearing will come to order. Good morning and welcome to all of you today. Today's hearing focuses on the challenges that america faces in meeting the increased demand for electricity. Something that's gotten a lot of attention with good reason. Demand has been trending upward in recent years and some expect it could grow by 25% just in the next five years alone.
▶ 0:17:50Chair Lee: Data centers supporting artificial intelligence, advanced manufacturing, the planned retirement of current production sources are just a few of the causes creating this increased demand. As more people are drawn toward electric cars, that would put additional demand as well into play. America needs to put more electrons on the grade.
▶ 0:18:15Chair Lee: We will be hearing from three witnesses to better understand these issues today and we are very fortunate to have first peter huntsman, chairman and ceo of huntsman corporation, jeff tench, executive vice president of vantage data centers. Welcome. Finally, rob gramlich, president of grid strategies. Thank you all for being here. Let's begin with a simple fact. America's electricity demand is surging.
▶ 0:18:45Chair Lee: It is not creeping up, it is surging. For decades, power demand in this country remained relatively flat. Utilities planned for it, markets priced for it, regulators counted on it. But that era is over. We are now entering a new era of electrification. Data centers, ai computing, manufacturing, electric vehicles, all of it.
▶ 0:19:13Chair Lee: Even conservative estimates suggest we could see 2% to 3% annual growth compounded over the next decade. That number, 2% to 3% annually compounded, may not sound like much but it is a two-way highway that was built decades ago that is now expected to carry rush-hour traffic to and from a major city every day of the year. More cars, bigger trucks, constant congestion.
▶ 0:19:43Chair Lee: If the road has not changed but everything around it has changed, that is going to be an issue. It is a fairly decent analogy, something to help understand our power grid and the challenges now facing it. Here is the real problem. We have spent much of the last 20 years shutting down a generation that can actually meet that demand.
▶ 0:20:08Chair Lee: Coal plants, retired, nuclear, blocked. Natural gas, tied up in ending this litigation -- endless litigation. We replace a lot of that capacity with solar, wind, resources that don't work all the time, roughly a third of the time. One third of the time. That is not enough to support the dispatchable baseload power that we need for these sources I mentioned.
▶ 0:20:39Chair Lee: These resources being non-dispatchable means they cannot be dispatched at the exact moment that they are needed with deductibility and the reliability that is required. They do not provide baseload power and they do not build themselves.
▶ 0:21:02Chair Lee: They require massive transmission overhauls, grid upgrades, and in many circumstances, subsidies. So this isn't a free market. In many ways, it's a rigged one. The federal market has been investing heavily in certain green energy technologies for decades, handing out tax credits like candy. Naturally, developers follow these credits, and why wouldn't they? But what is the result?
▶ 0:21:30Chair Lee: 95% of projects waiting to connect to the grid happened to be solar and batteries, but only 10% of those ever make it onto the grid. Meanwhile, gas plants, nuclear reactors, geothermal, these things that can provide a predictable, reliable, clean baseload power, they get crowded out or delayed endlessly or blocked entirely. Why?
▶ 0:22:00Chair Lee: Government red tape is responsible for a lot of it. Activist-funded lawsuits also has a fair amount to do with it. A government that picks winners and losers and consistently picks losers creates a lot of this problem. Look at what ferc tells us. Between now and 2028, we are set to retire 24 gigawatts of coal-fired generation in the next three years alone, and replace it with just five gigawatts of gas-fired power.
▶ 0:22:32Chair Lee: That math doesn't work. Not in theory, not in practice. Not now, not anywhere, nor at any time. The system was built for slow, steady growth. What we are facing now is a tidal wave. If we don't change course, if we don't wake up to this reality, the lights are going out. We need utilities, developers, states, and congress to start telling the truth about this. The grid is not ready, the system is not built for this.
▶ 0:23:04Chair Lee: The path that we are on will culminate quite predictably and rolling blackouts, rising prices, national vulnerability, and our inability to remain competitive in what many are describing as the ai global arms race. Only july 7, the U.S.
▶ 0:23:21Chair Lee: Energy department warned, between growth and demand and the retirement of some current sources, if we don't take steps to respond to the increased demand, the risk of blackouts in the united states will increase 100 fold. I repeat, increasing 100 times what we currently face, in terms of blackouts across the country.
▶ 0:23:48Chair Lee: We currently experience annual outage hours in the single digits. If we don't take effective steps, the estimate is more than 800 outage hours per year in the next five years. We cannot allow that to happen. We have too much riding on that. It is time we faced the facts, and that is what this hearing is about. The chair now recognizes the ranking member, senator heinrich.
▶ 0:24:16Sen. Heinrich: Thank you, chairman lee. Welcome to our witnesses, Mr. tench, Mr. huntsman, Mr. gramlich. The scale and drivers of today's rising electricity demand are relatively unprecedented. It is not just that electricity demand is reaching record highs, it is that we are entering a new era of sustained low growth.
▶ 0:24:39Sen. Heinrich: The structural forces underlying today's load growth are converging, the growth of ai data centers, the electrification of vehicles, buildings, industry, as well as a resurgence in domestic manufacturing. And meeting this load growth will require structural changes to how we permit and build our energy infrastructure. In his testimony come Mr. tench states that vantage would prefer to source power from the grid, but that the system is out of sync.
▶ 0:25:11Sen. Heinrich: From interconnection timelines that are too long, transmission lines that take too long to build, and permitting that is too fragmented, the challenges that Mr. tench articulates are the same ones that this committee has been trying to address for some time. As Mr. tench notes in his testimony, no single business or technical workaround can substitute for a coordinated, modern, responsive grid. Fortunately, we sit on the committee that can help make that happen.
▶ 0:25:41Sen. Heinrich: The urgency just is not about maintaining our edge in ai innovation, it's about affordability. As Mr. gramlich points out in his testimony today, electricity bills are becoming unaffordable for too many americans. And recent actions by president trump and by the big bad bill will make this worse.
▶ 0:26:04Sen. Heinrich: The reconciliation bill alone is estimated to increase annual energy costs more than $16 billion in 2030, and more than $33 billion by 2035. This is because, at a time when we need every single electron we can get, the reconciliation bill is causing many clean energy projects to be canceled.
▶ 0:26:25Sen. Heinrich: And the president's tariffs are driving up equipment costs, raising up the cost of all energy generation resources, all of them. This is leading directly to american spending more on their utility bills. On top of this, an aging electrical grid is causing many energy projects to be stalled for years in interconnection.
▶ 0:26:53Sen. Heinrich: In 2025, grid strategies released a study that found investing in well planned, high-capacity transmission could save U.S. households between 6.3 and $10.4 billion annually. And that is after accounting for the cost of actually building those transmission lines. The amount of energy currently in U.S. interconnection queues substantially exceeds the existing demands. If only the grid could integrate it.
▶ 0:27:24Sen. Heinrich: According to the energy information energy in 2024, the U.S. installed nearly 49 gigawatts of new grid capacity. 95% of which was for renewable sources.
▶ 0:27:39Sen. Heinrich: This year, eia estimates developers will build 63 gigawatts of new capacity including 32 point five in new utility scale solar, 7.7 gigawatts of wind power, 18.2 gigawatts energy storage, and just 4.4 gigawatts of natural gas-fired generation.
▶ 0:28:00Sen. Heinrich: Clean energy is the most affordable and it is the fastest type of energy generation to deploy, outpacing natural gas, which is facing years long backlogs and turbine availability. You'll be lucky if it puts its first electron on the grid before 2032.
▶ 0:28:26Sen. Heinrich: Meanwhile, states like texas and california are demonstrating that high levels of renewable energy do not compromise grid reliability. In fact, they improve it. After texas added 9600 megawatts of clean energy including 5400 megawatts of solar, 3800 megawatts of energy storage, and 253 megawatts of wind, the ercot ceo said that the risk of grid emergencies dropped to less than 1%.
▶ 0:28:58Sen. Heinrich: That is down from 16% the previous year. Nerc's 2025 summer reliability assessment confirmed the trend, showing the risk of rolling blackouts in texas fell from 15% to 3% as battery capacity came online. I will close by saying that I am deeply disturbed by the recent department of interior policy that requires secretary doug burgum to personally review and sign off on wind and solar projects on federal land.
▶ 0:29:31Sen. Heinrich: This nakedly political decision will risk delaying new generation additions to the grid when we need them the most. And consequently, it will drive up cost. According to the department of energy, federal lands in the contiguous united states could support more than 7700 gigawatts of renewable energy capacity.
▶ 0:29:53Sen. Heinrich: With that said, look forward to discussing how we can meet the rise in electricity demand and lower energy costs for households by integrating the most affordable and rapidly deployable energy resources to date, while also investing in long-term modernization. Thank you, chairman.
▶ 0:30:12Chair Lee: Thank you, senator heinrich. We will now hear from each of our witnesses. Five minutes to make your opening statements. We will hear first from Mr. huntsman, then Mr. tench, Mr. gramlich. Mr. huntsman, you may proceed.
▶ 0:30:28Mr. Huntsman: Thank you very much. Chairman lee, wrecking member heinrich, members of the committee, I am the chief executive officer of the huntsman corporation. For the first time in a generation, americans face an increase in electricity demand that will have far-reaching consequences if not managed publicly by elected officials in both parties at federal, state, and local levels. This may sound like hyperbole but it is not.
▶ 0:30:56Mr. Huntsman: Look no further than germany, united kingdom, and much of europe and see how quickly great powers can implement policy to kill productive and frightening industries that form the backbone of modern economies they were just a decade ago, these nations were great industrial powerhouses.
▶ 0:31:14Mr. Huntsman: Today, they have the highest electricity prices in the industrialized world, shrinking economies, and factories being shuttered almost daily .why I am as our company has laid out thousands of employees in europe . Facilities that were globally competitive just a few years ago have been closed and are no longer operating due to ruinous and unrealistic net zero and decarbonization policies.
▶ 0:31:41Mr. Huntsman: And the failed idea that you can power a modern economy without developing oil and gas resources. The chemical industry, we use large amounts of energy and electricity. Mostly derived from oil and gas, break them apart, and then put them back together to make the physical building blocks of virtually everything you see, touch, and consume in modern life.
▶ 0:32:05Mr. Huntsman: Our entire supply chain employs millions of americans and is mostly domestic based, from transportation, technology, food supplies, medical equipment, building materials, pharma, and textiles. None of this would be possible without the chemical industry, none of it.
▶ 0:32:23Mr. Huntsman: Technology companies perform similar functions, taking energy and electricity to create data that enables everyone of us to tap our mobile phones -- another product that contains over 100 different chemicals to build -- and access the world at our fingertips.
▶ 0:32:40Mr. Huntsman: Virtually every step in the tech world from chip manufacturing to data generation, storage, transmission, computing, consumer interface use petrochemicals and enormous amounts of electricity to not just maintain, but to grow this vital industry. The advent of artificial intelligence is fast changing the face of modern society and global competitiveness. A I will bring an enormous wave of societal benefits similar to every past industrial and technological advancement.
▶ 0:33:11Mr. Huntsman: However, it is simply impossible for this to happen in the society that does not have the basic hydrocarbons to both construct the physical materials needed to build, and the electricity required to power this great advancement. The challenge before us today is a real. The opportunities are even greater. The united states has both the raw material and technological base to not just compete but to continue to lead.
▶ 0:33:38Mr. Huntsman: Our greatest challenge will be to balance the enormous demand for more electricity while being able to keep prices affordable and supplies reliable for both consumers and industry, especially those who do not benefit from trillion dollar balance sheets.
▶ 0:33:56Mr. Huntsman: If our growing demand for electricity being consumed by data centers and a growing tech industry are not met with additional reliable and affordable -- we risk losing our consumer affordability. It is simply impossible to build a modern industrial and technological economy on an energy base that is neither reliable or affordable.
▶ 0:34:18Mr. Huntsman: We can talk all we want to about nuclear ambitions that are decades away, intermittent wind and solar dreams that are operable 25 to 40% of the time, and require even greater investment in more reliable backup and unrealistic battery storage, but these dreams will never solve today's problems. Demand for power and raw materials are here today and growing tomorrow.
▶ 0:34:42Mr. Huntsman: If we continue to build out more tech industry consumption than production of electricity while supporting the production of largely hydrocarbon-based energy sources, we will look more like europe and less like the continued model of growth that has made the united states the envy of the world.
▶ 0:35:02Mr. Huntsman: Senators, now is the time for ambitious and bipartisan planning that will allow the american industry, capital markets, and innovation to meet the needs of these exciting times and opportunities. Our company, our industry, and most importantly, the millions of people that rely on our operations look forward to being a part of the needed solutions and innovations that will require -- will be required for our work continued success. Thank you.
▶ 0:35:29Chair Lee: Mr. tench.
▶ 0:35:31Mr. Tench: Chairman lee, ranking member heinrich, members of the committee thank you for the , opportunity to testify today. My name is jeff tench, and I serve as executive vice president for north america and asia pacific at vantage data centers a colorado-based global , developer, owner, and operator of hyperscale data centers for leading U.S. technology companies. I would like to briefly summarize my written remarks that have been submitted for the record.
▶ 0:35:59Mr. Tench: While I do not claim to be an expert on energy policy, I have spent my career building businesses and leading teams that construct and operate the most efficient, secure, and resilient large-scale digital infrastructure in the world, and I appear before you with one message based on what I have seen from my position.
▶ 0:36:18Mr. Tench: The greatest barrier we collectively face to our country's leadership on artificial intelligence today is timely access to reliable electric power .I have spent my . Demand for the ai and cloud infrastructure that vantage provides is accelerating. Over the past decade, I've seen the scale and speed of hyper skill development grow dramatically. A 30 what facility was considered large.
▶ 0:36:44Mr. Tench: Today, 100 watts is the starting point with campus developments commonly reaching 500 megawatts or more. And we have multiple customers seeking one gigawatt or more for ai infrastructure which is the equivalent of all electrical power used here in washington, D.C. in market after market across the U.S., our development teams all report the same issue. We cannot get the amount of electricity we need in the timeframe to build our data centers.
▶ 0:37:13Mr. Tench: Without electrical power, it is not possible to build digital infrastructure with the infrastructure that supports ai, data centers, transmission lines, generation facilities must scale rapidly if the U.S. is to remain the global leader in ai innovation. We are asking for your leadership to drive a more modernized policy framework that reflects today's growth, reliance with investment timelines, and ensures the power system is ready when and where it is needed.
▶ 0:37:38Mr. Tench: From vantage's perspective, the challenge is clear, we cannot access power in a timeline that aligns with customer demand. First, interconnection timelines are too long both for new load and new generation resources. Second, we must develop new transmission for a more scalable and reliable grade. Third, permitting is fragmented and sequential, resulting in but increase cost and delays and projects that are otherwise ready to proceed.
▶ 0:38:05Mr. Tench: If we do not act decisively, we risk ceding ai leadership to countries that are meeting faster to modernize their energy infrastructure. The united states is at a pivotal moment. United states is looking at in ai era that is not coming, but is here. We have the capital, we have the customers and the talent, but we will not lead if we cannot power it.
▶ 0:38:32Mr. Tench: By prioritizing infrastructure for high-growth sectors, strengthening federal leadership, enforcing interconnection reforms, incentivizing high-impact transmission, these policies can unlock the power system needed to support america's digital future. Vantage is prepared to invest and deliver. We bring development and operational expertise, capital, long-term commitments to the communities where we build. Let us work together to build an energy delivery system that is ready to meet the scale and importance of this moment. Thank you for the opportunity to share our experience.
▶ 0:39:02Mr. Tench: I look forward to your questions and to working together on solutions that keep the united states at the forefront of digital infrastructure, innovation, and investment.
▶ 0:39:12Chair Lee: Thank you, Mr. tench. Mr. gramlich.
▶ 0:39:16Mr. Gramlich: Chairman lee, ranking member heinrich, members of the committee, thank you for the opportunity to testify. My name is rob gramlich and I am founder and president of grid strategies, a power sector transmission and power markets consulting firm based here in the D.C. area. Thank you for doing this hearing. This is about one of the most important topics facing the country before one of the most, if not the most important legislative committee.
▶ 0:39:47Mr. Gramlich: Power demand growth is sudden and significant and will be a challenge to meet, and affordability is equally important, as I'm sure you are hearing from your constituents. I will focus now on how we can meet demand growth affordably. Basically, we need both transmission and generation. I will start with transmission because that is the one that is largely in federal jurisdiction, as a federal role, while generation is largely reserved for the states and the federal power act. Transmission is also the main thing that we need right now.
▶ 0:40:17Mr. Gramlich: It has the highest impact come is the great integrator of all resources. It may seem like it is a renewable energy piece of infrastructure, but that is just because over the last five years, that is all anyone was trying to connect to the grid. Right now we are seeing lots of other things trying to connect to the grid, including jeff's data centers, data centers around the country, manufacturing, other types of generation.
▶ 0:40:40Mr. Gramlich: Whether it is nuclear, ccs, other types come it will face that same constraint grid, so we should focus on the grid. Economies of scale are massive. There is a 75% discount if you do the higher voltage like 765 kv lines as opposed to 230, like four regions are doing. Transmission can also help in the 20 20's, not just a 2030 or 2040 option.
▶ 0:41:10Mr. Gramlich: Some lines are actually quick and there are advanced transmission technologies and other ways to use existing corridors. Transmission supports reliability and resilience more than any other resource. The availability of transmission lines is 99 .85 percent or above for all voltage classes, meaning it is much more available than any type of generation.
▶ 0:41:31Mr. Gramlich: With severe weather events in recent years, we have seen tens of gigawatts, 10% of a regions power, surge across regions of the country because of interregional transmission, which is why congress directed the north american electric reliability corporation, and there, to study interregional transmission, and it found we have a need for 35 new gigawatts of interregional transmission. The U.S. is falling far beyond competitors.
▶ 0:42:00Mr. Gramlich: China is doing 80 times what we are doing here on high-voltage transmission. I do think transmission really is my should be the bipartisan and unifying force that commands congress' attention. In addition, we certainly need to expand generation as well. There are three general types. There is low cost, plentiful energy, the fast, flexible balancing type of generation. That there is firm power.
▶ 0:42:28Mr. Gramlich: I'm not saying all resource provide although these things. We need firm power to meet peak loads. Resources provide varying levels of contributions to meeting peak loads. Nuclear has the highest contribution at 95%. We are not able to get much more very soon. Gas ct's, according to pjm, 60% in terms of their ability to serve peak loads. Combined cycles are a little bit higher in the 70's. Offshore wind is actually 69%.
▶ 0:42:59Mr. Gramlich: None of these resources are perfect, but the point is, when you put them together on the integrated grid, that is how you got nearly 100% reliability of the power system. By the way, flexible data centers and other loads will help alleviate the need for that capacity. The good news is, we have two working processes in this country to get the generation we need.
▶ 0:43:24Mr. Gramlich: We have utility-owned planning, regulatory planning in the states, some regions have markets. It is up to the state whether they want to be planning or be in markets. All of their plans are staying online longer than anyone thought, new plants are coming in, both in the integrated resource planning context and the market context. Look at the pjm prices that came out yesterday. Markets are screaming for generation to either stay on or be added. That is working.
▶ 0:43:54Mr. Gramlich: The internet connection qu eues need some improvement. In my final 20 seconds, what can congress do? I would focus on transmission. I have some specific ideas in my testimony. Regional planning like ferc order 1928. Congratulations on a bipartisan and decisive vote on last year. A lot of great ideas.
▶ 0:44:21Mr. Gramlich: I hope that is a starting point for further bipartisan cooperation on legislation. Thank you.
▶ 0:44:26Chair Lee: Thank you, Mr. gramlich. We will begin five-minute rounds of questions alternating between republicans and democrats. I believe it off, followed by senator heinrich, alternating between republicans and democrats in order of seniority subject to the earlybird rule. Mr. tench, let's start with you.
▶ 0:44:49Chair Lee: In comments filed in response to the ai action plan rfi issued by the white house, vantage noted its development of an on-site utility scale gas power plant in virginia to power a data center in that region. Can you explain why vantage decided to use gas for that on-site generation?
▶ 0:45:13Mr. Tench: The shortest answer is we were left no choice. The planning cycles for our data center development can sometimes span multiple years. In this particular case, we were subject to a change in the demand algorithm, a local utility.
▶ 0:45:35Mr. Tench: Had been planning on allocating to us 100 megawatts worth of power, to power our data center project there in loudoun county, when suddenly after we were under construction, we were told the power was no longer available and would not be available for five or seven years. At which point, we have committed hundreds of millions of dollars into the project.
▶ 0:46:02Mr. Tench: In this particular case, we were fortunate in the fact that our property sat on top of a high volume, high pressure natural gas line. We designed, built, commissioned a power plant operating completely independent of the grid within 18 months. That data center is up and running with a very important customer of ours today.
▶ 0:46:25Chair Lee: I assume you didn't go with others for various reasons, would have taken too long. Why not wind and solar?
▶ 0:46:34Mr. Tench: In this particular case, our option was only to be able to develop a power solution for that site that was not grid dependent at all. That was the choice of people made. People may refer to it as island mode.
▶ 0:46:49Chair Lee: Wind and solar would not provide --
▶ 0:46:53Mr. Tench: Not in that particular case. The parcel was only big enough to handle a turbine plant. There would have been no way to bring in wind and solar in that case.
▶ 0:47:02Chair Lee: Mr. huntsman, in testimony provided last year to the senate finance committee, you argued that affordable, abundant, reliable energy is foundational to american manufacturing dominance. America has abundant resources like coal, gas, geothermal, in some cases hydroelectric.
▶ 0:47:27Chair Lee: We also have expertise to build nuclear, which I'm optimistic about, becoming commercially viable in the coming years, assuming we can overcome the regulatory hurdles which we are anxiously trying to do. There have been some antigrowth forces including environmental ngos that help to capture many of our fortune 500 companies. In some cases, big energy companies come in other cases big tech companies, to endorse a net zero framework.
▶ 0:47:56Chair Lee: Corporate leaders know that such goals and commitments are impossible to achieve, not to mention harmful to the many of the very industries they represent. Can you elaborate on how the sustainability commitments harm energy affordability and reliability?
▶ 0:48:10Mr. Huntsman: So many of these commitments have a longer-term objective. We will be carbon free by 2050 and so forth. You'd be shocked by the number of ceos that I've spoken to that say I don't have to worry about that, I won't be around. I can make the commitment today but I will not be around then. There is no viable path when you look at a global basis, when you look at replacing hydrocarbons with renewables.
▶ 0:48:39Mr. Huntsman: Again, renewables have a very important role to play in certain areas. We make a raw materials going into the wind blades. I am not anti-any of that. I want to be clear on that. But as far as reliable, the reason you are building gas turbines, nobody knows a week from today if the wind turbine will be turning or not. Nobody knows exactly how much power you'll be getting out of solar panels a week from today. They can tell you what you will get out of a gas turbine.
▶ 0:49:10Mr. Huntsman: I am more concerned about today and how we get to the issues of today, how we get to the issues of the next five or 10 years, because that will dictate where we are in 2040, 2050. Unrealistic goals that we hope will come up with some means or mechanism just is not possible or realistic. That is what we are seeing in europe.
▶ 0:49:29Chair Lee: They have their place certainly come good things that can be accomplished with these, but some of those areas, including those air is growing fastest in our economy, things like ai data centers, you cannot rely on that because it doesn't provide baseload power. What would happen if you tried to do that, whether manufacturing or ai data center, that needs consistent baseload power? What would happen if you had to rely on something intermittent?
▶ 0:49:58Mr. Huntsman: You are shutting down. A facility like ours goes down unexpectedly, it can take 30 days to restart, costing tens of millions of dollars. That is why I mention four or five times in my oral testimony the word reliability. That is very key here.
▶ 0:50:16Chair Lee: Some of the emerging nuclear technologies certainly hold a lot of promise in that area, offering zero emission alternatives. Those are coming, not yet here, in a way that is commercially deployable. My time has expired. Senator heinrich.
▶ 0:50:35Sen. Heinrich: Mr. tench, you may be aware that the department of interior recently released a memo that will require the secretary to review all wind and solar projects on federal lands, adding one more layer of red tape. Do you have opinions on what the potential business impacts of energy projects just being delayed in the regulatory process, how that further delays impact, the business prospect?
▶ 0:51:08Mr. Tench: Our observation and requirement is for more electrons, as you called out in your opening remarks. Vantage is relatively agnostic as to the source of those electrons. In the case of rulemaking, regulatory action that slows down the process of approving new generation or new transmission, would definitely be a negative for our business.
▶ 0:51:37Sen. Heinrich: In the sort of five-year window, 2025, 2030, shouldn't we be focused on putting as many electrons agnostic of generation source, to meet the kind of demand that you represent?
▶ 0:51:54Mr. Tench: Yes. Our position is that efforts to move electrons around through enhanced transmission is important, necessary, but insufficient relative to the overall demand. We need more energy, more generation, more transmission independent of source. That said, it does need to be a reliable grid dispatchable source, which can be accomplished with the right combination of energy source for generation and energy storage.
▶ 0:52:23Sen. Heinrich: One of my concerns is, we have an existing pipeline that is the result of decisions that have been made over the course of the last decade. That pipeline is 95% clean energy plus storage, about 5% gas. A year or two ago, we had a couple of nuclear plants come online, which are great, I support that, but that is kind of a one off.
▶ 0:52:51Sen. Heinrich: In the next five years, if we start building new nuclear today, whether that is smr or traditional light water reactors, that will take longer than the five-year window. If I order a combined gas turbine today, it will probably come on the grid in 2032, 2033 if we are lucky.
▶ 0:53:15Sen. Heinrich: If you don't allow the existing projects that are in the queue today that are renewables plus storage, what does that do to the price pressure on the grid, what is the impact of that?
▶ 0:53:28Mr. Tench: As it relates to price pressure, I will defer to rob on that question as more of a grid expert. In the broader context, our goal is to encourage speed, change and revelatory process to bring more electrons on the grid. Depending upon the site in which we are developing, our access to proximate energy sources varires . -- varies.
▶ 0:54:01Mr. Tench: We are being pragmatic about how we approach that, how we with the demand.
▶ 0:54:04Sen. Heinrich: Mr. gramlich, do you want to address the price pressure issue?
▶ 0:54:09Mr. Gramlich: Basically it is supply and demand. Scarcity of generation. So anything that is limiting new generation from coming on, whether interconnection queues, permitting holdups at interior, anything else, that is cutting up supply and that is definitely raising prices.
▶ 0:54:27Sen. Heinrich: We are seeing prices go up.
▶ 0:54:30Mr. Gramlich: Prices going up wholesale, power prices going up. Those higher costs are required to be incorporated by state public utility commissions into retail bills.
▶ 0:54:45Sen. Heinrich: Are there places where prices have actually come down in recent years that you can point to? What was the reason why those prices came down?
▶ 0:54:53Mr. Gramlich: Sure. If you just look at say the supply staff or someplace like texas, over the last couple of days, has had a majority of their peak demand. Not just overnight, winter. Peak afternoon air conditioning driven demand served by a majority of renewables plus storage.
▶ 0:55:16Sen. Heinrich: Were there rolling blackouts?
▶ 0:55:19Mr. Gramlich: There were not. You probably heard about rolling blackouts in california five years ago. Honestly, they got behind on resource adequacy, but they built a lot of solar and batteries. Same dynamic there. We are seeing a majority of renewable energy. Any hour now it will kick in.
▶ 0:55:39Mr. Gramlich: The air conditioning load this afternoon, when it is high, it will be solar, then the sun will set, air conditioning load will still be high, but then the batteries will kick in and serve through the evening.
▶ 0:55:50Sen. Heinrich: One last question because I'm running out of time to Mr. gramlich. What can we do as congress to improve the interconnection queue process? That is preventing a lot of resources, electrons from getting on the grid in a timely way to meet the kind of demand that Mr. tench represents.
▶ 0:56:10Mr. Gramlich: Yes. Ferc have been working on interconnection queues, each rto is doing it in their own way. There are some great models like the southwest power pool, a simple entry fee, you get in, you don't have to do a four-year-long study. Congress could encourage things like that, encourage ferc to take activities like that. You probably have a couple of nominees, before this committee soon. You could ask them about that.
▶ 0:56:39Sen. Heinrich: I will.
▶ 0:56:41Chair Lee: We will now turn to our colleague from mississippi, senator hyde-smith.
▶ 0:56:48Sen. Hyde-Smith: Thank you to all of the witnesses that have come to share your testimonies. It is great to have the resources that we have two you. I appreciate your willingness to do that. My question is going to be directed to Mr. tench. You mentioned in your testimony that vantage prefers to connect to the grid for power, but there may be a need to deploy outside of generation at the start of the project, which makes sense.
▶ 0:57:18Sen. Hyde-Smith: As you point out, beyond company building schedules, adding to the grid can take a long time. It can take years. Usually taking around five years for the most traditional baseload power that you are looking at there. What short-term solutions has vantage explored for initial builds, and do you think other companies would follow a similar pattern waiting to connect to the grid?
▶ 0:57:49Mr. Tench: In the case of vantage, we have, coming out of the experience I described in virginia, have been far more planful in terms of the expectations of delays as it relates to interconnection that we apply for, to receive load from the grid.
▶ 0:58:15Mr. Tench: The form it has taken for the most part is investing in the supply chain of turbines and reciprocating natural gas engines, which we increasingly plan to deploy in a mobile setting so we can deploy them on trailers for let's say two or three years until we can get the interconnection from the grid.
▶ 0:58:38Mr. Tench: That has proven to be an important part but only one part of our overall plan for how we make our way through the wait, if you will, as it relates to the electrons we need.
▶ 0:58:47Sen. Hyde-Smith: You think other companies may follow a similar pattern to that?
▶ 0:58:52Mr. Tench: That would be up to them. Certainly for us, we found a way of reducing our risk and the gaps in availability.
▶ 0:59:01Sen. Hyde-Smith: From a connectivity standpoint, what would vantage's plan b once utilities meet electrical generation demand, once you get there?
▶ 0:59:11Mr. Tench: Our plan would be to connect to the grid, operate according to the regulations that exist in any of those states in terms of having a firm commitment from the utility through multiple services agreement. Then we would use that as our primary source of power to our data centers, coupled with emergency generation backup, which we deploy in most of our sites as well.
▶ 0:59:36Sen. Hyde-Smith: Thank, Mr. chairman.
▶ 0:59:38Chair Lee: Senator wyden.
▶ 0:59:43Sen. Wyden: Thank you, Mr. chairman. This is an important panel. Let me begin by saying that idle think got in this predicament by osmosis. The fact is, republicans have been doing favors for their big oil buddies at the consumer's expense, and that is why a major reason why energy bills are going through the roof. I am just going to take a minute and look backward, and then talk about where we ought to be going.
▶ 1:00:13Sen. Wyden: We have 50 years of gridlock on climate. No pricing, no regulatory reform, no nothing. The senate finance committee, we put together an alternative, and it was based on markets. It was based on technology neutrality. Underlying those words, technology neutrality. Everybody is part of the market. You get choices. And the more you reduce carbon, the bigger your tax savings.
▶ 1:00:44Sen. Wyden: In a couple of years, we got hundreds of billions of dollars committed -- committed to making sure that we have those renewable choices. Now, along come the senate republicans, particularly in the last couple of weeks, and when the natural gas folks -- these are not the environmentalists, these are the natural gas folks -- basically saying we will take electrons if they are from mars.
▶ 1:01:13Sen. Wyden: We have to have electrons, we will take them from anywhere. Not just because of ai, but because of growth, innovation. Regrettably, the senate republicans said we are not for choices. We are not for options, we are not for alternatives. Of course, that does not let us meet the challenge of demand.
▶ 1:01:37Sen. Wyden: So my view is, what I will keep pushing for the senior democrat on the senate finance committee, is working with anybody across the political spectrum to get us more choices. Particularly as my colleague from new mexico said, the gas industry, not a league of conservation voters or sierra club, will tell you that the cheapest alternative now are solar and wind, and they need them today, not tomorrow. They need them today in order to drive markets.
▶ 1:02:08Sen. Wyden: Apropos of your good work on Mr. gramlich, I'd be interested in what your ideas are too kind of resurrect a choice-based system, rather than one that just hands out the goodies to the big oil companies. And by the way, people tell me -- you all are welcome to add this -- fossil fuels cannot meet our demand today. If we are going to meet demand, we need solar and wind. We need these alternatives.
▶ 1:02:40Sen. Wyden: After 50 years of gridlock on this issue, we broke up the inertia, broke up the lack of progress, and we were making a lot of progress. I want to see us get back to something that has as many of those choices, technological neutrality principles that we wrote in the finance committee, because I think that is america's energy future. By the way, nobody knows what the alternatives will be 30 years from now.
▶ 1:03:09Sen. Wyden: We need a science-driven approach. When we talk to joe manchin about putting this together, which he backed, he says we need more science. He will get that with a technology-driven system. Tell us what you'd be working on in terms of more choices.
▶ 1:03:25Mr. Gramlich: Senator wyden, thank you for your leadership on the technology neutral tax credit. A perfect example of something that provides a support to any and all technologies that meet the performance standards that congress can set out. I thought that was a great idea. Glad to see it enacted. Sad to see the early phase out. At this point, it's important for treasury to implement at least what congress passed.
▶ 1:03:55Sen. Wyden: You want to make sure there is no stalling around. As you know, we got a modest bit of the current system into the final bill. Now it looks like a bunch of people in the house are trying to roll that back. You tell the administration, suck it up here, and stand in there for choices and alternatives. Is that one of your messages?
▶ 1:04:18Mr. Gramlich: Certainty is critical for investment. On certain irs regulations kill certainty. You cannot invest if you don't know what the rules are.
▶ 1:04:27Sen. Wyden: What else would you do. More choices?
▶ 1:04:32Mr. Gramlich: Generally as I was saying before, the transmission grid is really in the purview of this committee, congress, ferc, and that is the great interviewer -- integrator of all resources or whatever a choose.
▶ 1:04:47Sen. Wyden: My time is up. That was the one thing that we were not able to get in the 20 election. Had we been able to negotiate a compromise with more choices, I would have put transmission number one as our challenge for the future. We will try to get those choices back. Interested in working with you on transmission. Thank you, Mr. chairman.
▶ 1:05:11Chair Lee: Thank you, senator wyden. Next to senator cortez masto.
▶ 1:05:19Sen. Cortez Masto: Thank you, Mr. chairman. Thank you all three of you for being here. In many ways, nevada has led the way in developing new energy capacity over the last several years. Quite honestly with the help of the tax credits and inflation reduction act, nevada was able to attract new businesses hoping to use our natural resources, one of them being solar, geothermal in the great state. I assume that is one of the reasons that, Mr. tench, you were there.
▶ 1:05:49Sen. Cortez Masto: I'm excited to hear that not only is vantage pushing for new data centers to be sustainable by design, you are including an ai campus in nevada which was announced july 15 that also seeks to lose a close loop chiller system to minimize the need for large volumes of water in the west where there is a lot of drought.
▶ 1:06:12Sen. Cortez Masto: Can you talk a little bit about why renewables are important depending on the region where your data center is, and are you using a renewable source for this data center, the ai in nevada?
▶ 1:06:26Mr. Tench: Yes, as you know, we are developing a substantial ai focus campus just outside of reno. The selection of that location was driven by a number of factors, including its proximity to the west coast, as an alternative to california where things can get pretty expensive and hard to do.
▶ 1:06:50Mr. Tench: At the same time, the mix of energy sources that were available to us through nevada power included, as you noted, their prior investments in solar in particular.
▶ 1:07:06Mr. Tench: For vantage, for our customers, we prefer to use grid, and the combination of total cost of ownership, the ease of doing business in nevada, and the physical location conspired to make it a great location for this deployment.
▶ 1:07:23Sen. Cortez Masto: Thank you. Mr. gramlich, you have outlined some of the challenges can to increased electricity bills across the country. In addition to severe weather and electric equipment constraints, you list the uncertainty surrounding the current administration's tariff policy and republicans termination of tax credits.
▶ 1:07:47Sen. Cortez Masto: A recent bloomberg government article stated that when if you were renewables be more expensive gas and explosive demand from data centers, and upward pressure on rates is the protectable result. Some estimates suggest our electricity bills and parts of the country could jump as much as 60% to 350% over the next decade. My next question to you is, can you summarize current market considerations, and why U.S.
▶ 1:08:15Sen. Cortez Masto: Grid operators are not in a position to turn away renewable electrons?
▶ 1:08:22Mr. Gramlich: Yes, grid operators need all the power they can get. As I've said, not all resources do all of the functions. We do need firm power. By the way, the geothermal in your state is providing excellent, firm power. Hopeful about geothermal going and many more states to provide that clean power. But the grid operators to depend on it. In terms of affordability, it is supply and demand.
▶ 1:08:52Mr. Gramlich: If we take any of these resources out of the mix, that just leads to higher wholesale prices, and those necessarily move down into retail customers' electric utility bills.
▶ 1:09:05Sen. Cortez Masto: Shoot in the state working with the private sector basically determine what that energy mix of that portfolio should be based on their geography, based on their opportunities there? We have geothermal, wind, battery storage, natural gas. That is different from my colleague here sitting to the left of me from maine. Shouldn't it be driven by that need based on the states where the region is, what the private sector is wanting to build?
▶ 1:09:36Sen. Cortez Masto: Does that make sense?
▶ 1:09:36Mr. Gramlich: I think that's exactly right. That is the structure of the federal power act that you oversee on this committee, implementation at ferc. Generation is largely in the purview of states. It is kind of a states rights issue.
▶ 1:09:52Mr. Gramlich: This kind of micromanaging of individual powerplant dispatch through things like department of energy emergency orders or specific targeting of projects for not getting permitting at interior, that is really micromanaging from the federal level, something that is really the state stopped to address.
▶ 1:10:11Sen. Cortez Masto: If we are going to compete with other countries like china and grow out our grid and transmission, really invest in it, that micromanagement should not occur. It really should be driven by the states, private sector on, correct?
▶ 1:10:25Mr. Gramlich: That's right. The reality is, we have a very diverse electricity structure. Each state uses markets or regulations, or various combinations of investor-owned and other types of utilities, to meet their power demand need. That is where the process should take place.
▶ 1:10:45Sen. Cortez Masto: Thank you, Mr. chairman.
▶ 1:10:48Chair Lee: Senator king.
▶ 1:10:52Sen. King: The word transmission has come up numerous times a day. How important it is and what an important part of this discussion. Unfortunately, this morning, the department of energy terminated a loan program for a major interregional transmission system in the midwest.
▶ 1:11:14Sen. King: So, here we are talking about how important transmission is, and here is the department of energy -- and it was not a grant, it was a loan guarantee program. I just think the timing is somewhat ironic. We all know that solar and wind are intermittent. We understand that, everybody knows that. I was in the hydro business, that is always intermittent. It doesn't always rain.
▶ 1:11:46Sen. King: As well as wind, biomass, large-scale conservation. What is really happening is really dramatic in terms of energy storage. If you have adequate energy storage, solar and wind are baseload, because you have something to make up the difference. I used ai in your honor, Mr. tench, to check on where we are on batteries. As of five minutes ago, the U.S.
▶ 1:12:17Sen. King: Added a record 10.4 gigawatts of utility scale battery storage in 2024, marking a 60 6% increase from the prior year. In 2025, the eia anticipates a record-setting year with another 18 gigawatts of utility scale battery storage on the grid. Looking ahead ,eia forecast that battery scale storage will nearly double, reaching 65 gigawatts by the end of 2026.
▶ 1:12:45Sen. King: In other words, battery, the battery industry is no longer a fantasy or a distant dream. It is happening right now in a very substantial scale. As you point out come Mr. gramlich, it saved the day in texas and california, and is already working, the idea of integrating batteries with solar and wind. Let me talk for a minute about transformation. Mr.
▶ 1:13:12Sen. King: Gramlich, it worries me, and electric bill used to be 25% transmission from a 5% source of energy. It is now about 5050 and transmission is getting more expensive. Everybody knows we have to rebuild the grid. My concern is it will be done in an expensive way that will add dramatically to ratepayers cost. Mr. gramlich, you are nodding. I take it you agree. The recordnodding.
▶ 1:13:40Mr. Gramlich: We are doing transmission sometimes in the most expensive way possible now. We can change that.
▶ 1:13:48Sen. King: One thing we can change that is a re-conductor. This is a traditional high tension line conductor. Here is a carbon fiber-based conductor. This little guy will carry twice the energy as this one. If we put these on the grid, we don't need to change all the poles, right of ways, that sort of thing, and we can get a significant amount of additional throughput in the grid at a fraction of the cost of rebuilding the whole system.
▶ 1:14:19Sen. King: You are familiar with the term gets. Various technologies that enable the grid to be managed more efficiently in terms of temperature, load. They could increase throughput by something like 40%. A fraction of the cost of rebuilding. My concern is the rate-based model encourages utilities to build rather than re-conducter.
▶ 1:14:52Sen. King: Talk about how we solve that problem. How do we provide incentives for those to do so with the most cost-effective way and minimize the effect of grid use?
▶ 1:15:03Mr. Gramlich: The cable you are holding is manufactured near los angeles. Unfortunately, 90% of the company sales go to other countries which are deploying advanced conductors and grid enhancing technologies in far greater levels than we are here.
▶ 1:15:23Sen. King: Is that because there is no incentive on the utilities to use this kind of technology?
▶ 1:15:26Mr. Gramlich: That is generally right. A lot of utilities are looking at them now but we need to make it more systematic.
▶ 1:15:35Sen. King: Another factor we have not talked about his demand response. The ability of customers to modify their demand load in terms of what is on the grid. Is that a promising technology?
▶ 1:15:50Mr. Gramlich: It's a very promising technology. It is not just the peak hour but think about flexible data centers. Sometimes the great contingency might happen once every three years. If they can curtail a little bit of that time, we can integrate more data centers without having to rely on the full network capacity which takes so long to serve the data center. That type of flexibility is critical.
▶ 1:16:15Sen. King: I'm running out of time. Solar and wind are the cheapest and the quickest to deploy. I'm worried as the vice chairman has said there's a five to seven year lag in new grid scale gas turbines. We cannot give china a starred in ai. We have got to be timely as well as controlling costs. Thank you for your testimony.
▶ 1:16:47Sen. King: Thank you, Mr. chairman. >> thank you for being here today. This is a fascinating subject. I have to tell you in recent years as I sat in this committee we had people come in and predict what was going to happen as far as demand for electricity and america because of ai and other things coming on board, particularly ai.
▶ 1:17:17Sen. King: I was a doubter at the beginning . The further we go the more obvious it has become we are going to be inundated with demand for electricity here in the next recent years. It is a problem but the good news is this particular problem we know how to deal with. We know how to generate electricity. We in idaho, in 1951, demonstrated for the first time that nuclear energy could be used to create electricity.
▶ 1:17:47Sen. King: We have been added ever since. -- at it ever since. We had a setback because a three mile island which put us a generation behind. Now the world knows there is a real renaissance going on as far as nuclear energy is concerned. Not only in the united states but also in eastern europe where they are trying to cut the cord with russia. I would like to get your thoughts on this.
▶ 1:18:18Sen. King: We are going to flip the switch in the next year or so on the first smr, which is going to change delivery of electricity in the world and this august we will cut the ribbon on a micro reactor we are starting at the inl in idaho. We are proud of our work on nuclear. We think we have the solution to all of this.
▶ 1:18:44Sen. King: I really think nuclear is going to have to be -- I agree we want to be all of the above. I think to deliver the load I really think it's going to take nuclear to do that. I would like to get your thoughts on that. Peter, good to see you again and your thoughts first please. >> I believe nuclear will be able to fill the baseload. I have to be honest with you.
▶ 1:19:16Sen. King: I'm the only one sitting here that pays a power bill of over of a quarter of a billion dollars a year. That is the gas and electric bill for my company. We talk about these renewables and so forth and solar and wind. The fact is it is failing in europe where it has been implement it on a widespread basis. The prices are going up through the roof. We can't afford it. We are shutting down facilities and laying off people. We talk about these -- the state of texas.
▶ 1:19:48Sen. King: We spent hundreds of millions of your manufacturing in the state of texas. The entire baseload is natural gas and nuclear and petroleum-based. Projects the incremental piece that is renewable is wonderful. I'm not opposed to that. Without the baseload we could not to buy electricity in texas. The only way we can compete today is because of the base we have of the hydrocarbon-based energy source.
▶ 1:20:20Sen. King: That is a reality of all of this. Eventually somebody has to pay for all the stuff.
▶ 1:20:26Sen. Risch: The fact the utilities now are kindling interest in nuclear, does it give you any solace going forward?
▶ 1:20:34Mr. Huntsman: Not a great deal. Personally I'm very concerned about where a lot of the stuff is going when I see how much of this is renewable. For every windmill that is built -- this is our product. For every window that is built you have to build a back up it. 70% of the time it is not going to be turning. You have to have a backup. Most the time -- most of the time it is idle. I'm paying for three systems.
▶ 1:21:02Sen. Risch: Not a problem with nuclear?
▶ 1:21:06Mr. Huntsman: No, but we are probably 10 plus years away from having mass scale nuclear power.
▶ 1:21:13Mr. Tench: As I think about our fleet across the united states we are fortunate to be operating data centers in places where part of the grid power we take down his nuclear. We are big proponents of further investment in acceleration, nuclear power both as a complement to the grid and some emerging technologies.
▶ 1:21:41Mr. Tench: I hope you are right about the next couple of years of seeing the first commercially viable solution for that. I think nuclear is absolutely a big part of the solution here.
▶ 1:21:54Sen. Risch: Mr. gramlich?
▶ 1:21:57Mr. Gramlich: I have not seen a public change in perception about technology ever is much as we have with nuclear, because so many people are motivated by the climate crisis and one clean power. Everyone is looking at the grid and realizes we need firm power. That is a clean, firm source I could make a great contribution.
▶ 1:22:18Sen. Risch: Idaho is here to help you. The smr that we developed and moving forward. We are really excited about the micro that is coming. That will change the world as they develop them and as they improve them out in the marketplace and is the interest -- they interest utilities and getting what will be a new wave of how they produce nuclear energy. Thank you, Mr. chairman.
▶ 1:22:47Chair Lee: Thank you. Senator hickenlooper. Step of hickenlooper -- Sen.
▶ 1:22:55King: Can loop or -- Sen.
▶ 1:23:01Hickenlooper: We have to win the ai race. It's our national security that is at stake. You highlighted high-voltage transmission, noting enabling the transfer of electricity between regions can lower operational costs for data centers and other large users. Without action from this administration and this congress to accelerate high-voltage transmission development will the U.S. stay globally competitive in the ai race?
▶ 1:23:36Mr. Tench: I don't think we can see that without interregional transmission we would fail to be globally competitive but our ability to move electrons seamlessly across this country in between these regions is freeing up access to power where it is needed. It allows us to build the data centers that contain the ai we are all scrambling for in terms of being able to stay competitive.
▶ 1:24:05Mr. Tench: It is one part, an important part of a change we can make to make better use of the grid we have. It is not in and of itself sufficient to avoid the outcome you are describing.
▶ 1:24:17Sen. Hickenlooper: Let me rephrase. The probability of our losing ground in the race towards ai, the probability we will lose ground increases if we don't address the issue with the grid?
▶ 1:24:34Mr. Tench: Yes.
▶ 1:24:34Sen. Hickenlooper: Would you believe any bipartisan or administration with reforms aimed at data centers should also include some of these ambitious reforms to the building that high voltage transmission?
▶ 1:24:52Mr. Tench: I would agree with that.
▶ 1:24:52Sen. Hickenlooper: Great. Mr. gramlich, studies show high-voltage transmission improves reliability and affordable -- portability. We have only built 3238 miles of high-voltage transmission from 2017 to 2024. We should be building 5000 a year. We should have built 35000 and we have built less than 3500.
▶ 1:25:22Sen. Hickenlooper: China is rapidly building a super grid of high -- older high-voltage -- ultra high-voltage that allows growth on a variety of facets we will not be able to match. In 2023, congress directed the study of transmission needs. We might need 35 give a watch -- gigawatts to ensure reliability.
▶ 1:25:50Sen. Hickenlooper: Can you explain in layman's terms the value of interregional transmission in terms of affordability and reliability?
▶ 1:26:00Mr. Gramlich: Thank you, senator. It is true that interregional transmission is the best way to improve reliability and resilience. We sometimes see 10% of a region's power served by the large-scale movement of power across the country over the interregional transmission network. Unfortunately none of us inherited a power system that was very conducive to that with thousands of vertical silos of utilities I don't have those horizontal connections.
▶ 1:26:31Mr. Gramlich: The regulatory structure is only trying to catch up to that. Your work through efforts and bills you have introduced on interregional transition are very welcome.
▶ 1:26:41Sen. Hickenlooper: I appreciate the preparations are witnesses make to make a senators look good. I appreciate that.
▶ 1:26:51Mr. Gramlich: It takes a lot of preparation for you, but that's ok.
▶ 1:26:55Sen. Hickenlooper: Thank you. I appreciate that. I was going to put out with this discussion we have been making their the hard truth that we need 100 gigawatts of power or more by 2030. Only four gigawatts of natural gas projects are even in the pipeline. Zero for coal. The market is not buying what is out there being sold.
▶ 1:27:28Sen. Hickenlooper: What kind of state-level intervention or studies and subsidies should congress and the trump administration -- what do we have to back and what should they be backing to build that 100 gigawatts of natural gas or coal capacity by 2030?
▶ 1:27:51Mr. Gramlich: It is not feasible to do it all with gas or nuclear in this decade is not going to happen. Nothing against it, it's just not going to happen. The gas turbines are constrained as senator heinrich mentioned. We really have to as a physical matter rely on many sources, all the sources developed and that includes wind, solar and battery storage.
▶ 1:28:18Sen. Hickenlooper: What you are saying is we need to take those things that are in the queue and are ready to be built even though they will not be sufficient to provide all the baseline, and I think there's a consensus we need to raise the baseline or baseload capacity. We need to build everything we can right now.
▶ 1:28:34Mr. Gramlich: Yes.
▶ 1:28:34Sen. Hickenlooper: I yield back to the chair.
▶ 1:28:42Chair Lee: As context, I have seen that the gdp of europe over, the last 20 years roughly equal 20 years ago to the U.S. collective gdp has flattened out and hours has grown. There is a relationship we know between power usage and with economic growth. You speak about the deindustrialization of germany. And how rational executive and now invest in germany.
▶ 1:29:15Chair Lee: Which is incredible. Can you expand on that? That would have incredible impacts on jobs or work and germans like having a similarly wrong policy of the U.S. would have negative implications for working americans. >> we have never had power outages in germany will stop is not a question of availability of electrons. Is the value of electrons.
▶ 1:29:41Chair Lee: In germany I'm paying for coal, first solar, for wind, for nuclear from france and imports of gas coming from the united states. Five sources. At best, two sources are actually operating and supplying our facilities but I'm paying.
▶ 1:29:59Chair Lee: For all fiveof them that literally -- you add the regulatory carbon taxes and the costs above that and I'm paying roughly about six times more for electricity for exactly the same facility in your state of louisiana. We operate a large facility in louisiana and virtually the same facility --
▶ 1:30:21Sen. Cassidy: How many people did you employ a peak in germany?
▶ 1:30:26Mr. Huntsman: In cross -- at peak was around 65,000. And now about 1000.
▶ 1:30:34Sen. Cassidy: If you get your regulatory policy and your electricity policy and power policy wrong, people disinvest or do you invest in the working families lose their livelihoods.
▶ 1:30:48Mr. Huntsman: Our customers, suppliers, the entire supply chain.
▶ 1:30:52Sen. Cassidy: You are suggesting the industry may be more in carbon intensive but the downstream effect is to decrease carbon intensity. Carbon fiber instead of steel in a plane. I imagine the carbon attends carbon fiber by definition maybe a little more to produce roughly equal.
▶ 1:31:24Sen. Cassidy: It saves you more of lifecycle. Can you elaborate on that?
▶ 1:31:27Mr. Huntsman: I believe senator king had the cabling. The wraparound is the carbon fiber that will be for the most part and epoxy material that insulates a lot of that transmission. That's the same materials going in and is lightening the load in lightning transition and making things stronger.
▶ 1:31:50Mr. Huntsman: The boeing 787 gets about 35% better mileage than the boeing 767, the model he replaced and all of that is virtually no elementia -- aluminum and carbon fiber materials. Our company loan about somewhere between 17 and 18 tons of liquid material, glue essentially, that goes 87 87 or airbus 350. That is lightening the plane and allowing it to fly further.
▶ 1:32:22Mr. Huntsman: You will be saving 100 fold.
▶ 1:32:23Sen. Cassidy: Even though in the moment in time, the snapshot it might look like things are increasing or whatever is increasing. If you take the product you are producing over the lifecycle of its use, the global climate is better from the perspective of --
▶ 1:32:44Mr. Huntsman: Park carbon is coming down. In manufacturing. We are getting the benefit of both. Better usage on the customer in manufacturing side.
▶ 1:32:57Sen. Cassidy: Next is going to be senator padilla. Hang on. I have video before cantwell -- padilla before cantwell. It is up to you guys. Y'all work it out. [laughter] >> if you don't mind. I want to begin by thanking you for your participation today.
▶ 1:33:27Sen. Cassidy: I want to talk about transmission. The only way to meet the energy demanded by building out the necessary transmission infrastructure to get power from where it is generated to where it is needed. Alas congress I worked with my colleagues on this committee in a bipartisan manner as he crafted the energy reform act which would advance transmission efforts. We have not only continued to see delays but also projections of load growth.
▶ 1:34:00Sen. Cassidy: We have seen energy costs increase. Mr. gramlich, you talked about the need to improve our transmission infrastructure as a means to improve affordability. I would love to see you expand on that and discuss how building more transition would increase energy affordability.
▶ 1:34:20Mr. Gramlich: Your state of california is now accessing resources in new mexico, wyoming and other parts of the west. It is like a puzzle, putting pieces together at different times of day, different resources. The wind from senator heinrich's estate or the wind from senator barrasso's estate.
▶ 1:34:50Mr. Gramlich: You get an overall much more steady supply that holds rates down and improves reliability. There transmission network is critical to making that happen. Your state has been leading and getting that transmission billed.
▶ 1:35:02Sen. Padilla: Do I hear you suggest that multistates coordinate the grid will improve affordability and reliability and deficiencies so emission reduction is a result? I hear some chatter in the western states around that concept.
▶ 1:35:20Mr. Gramlich: The legislation in sacramento is critical to get that regional network of an integrated grid, a seamless grid.
▶ 1:35:30Sen. Padilla: As long as we get it right, I agree. To be continued. I heard the chairman talking about some concerns in some quarters about solar and wind and renewable energy and intermittency. I want to make sure we are adding storage to the conversation.
▶ 1:35:50Sen. Padilla: You look at california's capacity, not just breaking records on a records on renewable sources but the threat of blackouts and brownouts because of the stability brought when you add storage to the equation. In addition to storage and other technology I'm excited about is reconduct during -- reconductering.
▶ 1:36:17Sen. Padilla: You talk about high-performance or advanced conductors in meeting our load needs. Rewiring our existing transmission line with state-of-the-art carbon fiber or aluminum alloy materials with the potential to deliver as much as twice the current or same size conventional steel and aluminum transmission cables. Was especially exciting it's utilizing existing infrastructure and rights-of-way.
▶ 1:36:48Sen. Padilla: Can you expand on how this new technology can help us meet load growth in the future?
▶ 1:36:55Mr. Gramlich: We know how scarce rights-of-way are and how hard it is to get new rights-of-way. We have these rights-of-way around the country that are a tremendous asset to this country. If we can squeeze power out of the right away which might be as simple as stringing up a new cable on the existing towers or rebuild of the towers, the advanced conductors and superconductors can help sometimes double the capacity.
▶ 1:37:23Mr. Gramlich: Grid enhancing technology is more the operational technology that senator king referenced and it was squeezed up to 40% for dynamic mind reading for example in the operational tools can create more headwind on the grid that allows remote to be developed.
▶ 1:37:45Sen. Padilla: Your suggesting we can do more electricity quickly than projects that are built on the ground up?
▶ 1:37:52Mr. Gramlich: Yes, and we will need both. Creating the headroom quickly and much more affordably seems like a no-brainer.
▶ 1:38:01Sen. Padilla: I will try to make this quick. I'm proud to represent california. Proud to be a policy leadership on not building capacity but lowering our emissions footprint as a result. California is not alone in investing and bringing online more solar and wind. Can you name other states, some not blue states that are similarly investing in improving grid reliability and affordability?
▶ 1:38:32Mr. Gramlich: The whole center of the country from texas up through north dakota has a tremendous penetrations of both solar and wind. Texas the last couple of days have has 80 gigawatts demand. A majority is being met was solar, wind and battery storage. They are using storage as you suggested and as you do in california, when the sun is setting that's on the batteries are charged up with the solar power and then they discharge to keep the evening lights on.
▶ 1:39:01Sen. Padilla: Renewals plus storage is not a democrat or republican agenda. It is just common sense. >> thank you for being here. These kinds of hearings before this committee are so important because they remind us that an energy policy that covers from maine to alaska and hawaii on the parts in between require a diversity.
▶ 1:39:29Sen. Padilla: I come from a state where we are proud to be producing oil. We are proud to be producing natural gas. Our reality is most of that -- most of the oil is sent outside our natural gas supplies in cook inlet are dwindling to the point where our utilities today are discussing how they are going to keep the lights on in the south-central region where the
▶ 1:40:00Sen. Padilla: Vast majority of alaskans call home. They are looking to canada for their source of supply. That is insult to injury to this senator cruz been working so hard to get us -- this senator who has been working so hard to a place that is affordable, reliable, diverse, secure, whatever you want to call it. It is a challenge right now. One of the things we looked to and recognized that there is no one-size-fits-all that fits us.
▶ 1:40:33Sen. Padilla: I don't know if it is fair to say we have pioneered microgrids in alaska but we have darned well been leading in the country when it comes to how you take these isolated grids, because we have one grid in the state. It goes up abou 354 -- about 350 to 400 miles and it comes down. It is like a rope.
▶ 1:41:01Sen. Padilla: There is vulnerability in that rope. This is something that again we are looking at ways that we can reduce our energy costs in the state that unfortunately experiences some of the highest energy costs in the entire country. I think that is counterintuitive to so many people who think you guys supply all the stuff. Why are you not able to keep your own lights on? We are a little bit of a conundrum.
▶ 1:41:32Sen. Padilla: At the same time we have great opportunities. We would love to be a leader in data servers. We have cold water. It is all the right things for you all. If we cannot power it, we can talk about advantages until the cows come home. We don't have any cows in alaska . We need to recognize that there is more that must be done in recognizing the extraordinary diversity. Mr. huntsman, I appreciated your testimony.
▶ 1:42:03Sen. Padilla: We talked about distorted markets. I agree. Our challenge is we don't have a distorted market. We just need to have more on our rail belt grid, just like we on our microgrids. We were pushed behind with this executive order that came out a couple weeks ago on wind and solar.
▶ 1:42:27Sen. Padilla: We have a couple of projects that are going to be integrated into this broader grid that is lng, hydro, a little bit of wind and solar. We are piecing everything together as best we can. Now we see a pushback on that eo by taking away the opportunities for greater affordability and reliability. It reminded me that we have been down this road before.
▶ 1:42:57Sen. Padilla: It was late 1970's where the government prohibited the use of natural gas for electric generation. Think about where we would be if we still had that policy in place. We are back to this place where it is kind of dangerous to pick winners and losers. Figure out how everybody participates in advancing a portfolio, an energy portfolio that makes sense across the board.
▶ 1:43:29Sen. Padilla: I guess I would direct a question -- to any of the three of you in terms of the importance of ensuring our federal policies are not in a position where we are picking the winners and the losers. I grant you, wind and solar have been " the mature technologies" for a long time. A long time.
▶ 1:43:57Sen. Padilla: We are now in a place for the secretary of energy in his deputy are spending their time at doi with a review of every individual wind and solar decision that comes with for the department. They have a lot to do. I think this is going to be distracting and taking away the time they need to be working on some of the issues that all three of you have mentioned here this morning. Any comment on that? I have run my full five minutes but go ahead.
▶ 1:44:28Mr. Huntsman: To the extent it adds cost to consumers, I hope they take a long time reviewing those projects. There are a lot of companies and a lot of consumers that cannot afford these redundant systems and a higher cost to all of them. I think we are losing focus when a tier four data center comes online. They need 99.997. They are out of electricity.
▶ 1:44:58Mr. Huntsman: An amazon center can be out of electricity for 27 minutes a year. Wind and solar could be a small part of the system but for the most part it's whether looking to buy nuclear facilities and so forth. It is the consumer that will get caught up with this higher pricing. Companies like ours are getting caught up in the higher prices. I'm concerned about a lot of this.
▶ 1:45:19Sen. Cantwell: I want to add one final point to this. I'm dealing with communities that if they can get 20% of their diesel powered consumption offset by some incremental wind and solar, it is 20% they are not spending. We are operating in different worlds, I get that. I get your point and I want to make sure you understand what it means and some of these really remote off the grid places.
▶ 1:45:52Mr. Gramlich: Thank you for your leadership on the permitting issue. Not just this review which seems awfully inefficient and could take a whole generation type off the table. On the staffing, committee permitting agencies for your state and others have great staff but they need to be staffed up. They are trying to get permits issued but in a legally sustainable way.
▶ 1:46:20Mr. Gramlich: If we lose staff of these agencies, that's a real challenge for any of the infrastructure we are trying to build.
▶ 1:46:28Mr. Tench: You made the comment that it is not a job to pick winners and losers. I agree. In our business we are simply trying to deliver for our customers the technology and the buildings and infrastructure to drive the deployment of ai in the grid. We receive electrons and we don't know what the source was.
▶ 1:47:00Mr. Tench: We have requirements in terms of availability. We have backup generation for the times are problems with the grid. As much as we can increase the total load that is available, along with the transmission of that load I think is a good idea.
▶ 1:47:23Chair Cassidy: We will begin a second round of questions. Mr. huntsman, one big tech company released its sustainability report sometime last week. It shows the company's carbon emissions rose by 6% last year in 2024. Primarily due to the development of data centers and electricity consumption that goes along with that and other activities.
▶ 1:47:53Chair Cassidy: Despite the rhetoric from big tech companies and others about net zero, the reality is they business model relied on big data centers requires a reliable power and affordable power and oftentimes natural gas that is the best option. In many cases is effectively the only realistic option.
▶ 1:48:17Chair Cassidy: Can you discuss how huntsman corporation focuses on innovation and sustainability as a means to achieve both economic growth and cleaner supply chains.
▶ 1:48:24Mr. Huntsman: In all the supply chains as we look at the chemical industry, the innovation we have is to make things lighter. If you look at the science of the water bottle, you pick them up today and it's unfortunately poor science but most of the water bottles today feel like they are almost going to fall apart. The water bottle contains about 15% of the material the same application did 10 years ago.
▶ 1:48:55Mr. Huntsman: That is innovation. It is making industry more efficient, lowering the cost and is better for the environment. If you apply that same technology in the ev will extend a mileage in the fuel consumption. Long-range power cables and high-voltage cables, you can increase the capacity that depending on the materials that are built into that cable.
▶ 1:49:25Mr. Huntsman: It's all about science and innovation. When we talk about the battery and materials to make this stuff, how much of that is being built and made introduced here in united states? That is something maybe for a topic for another day. We import a lot of raw materials on the mineral side and copper side from foreign powers and foreign entities.
▶ 1:49:52Mr. Huntsman: When we talked about the battery build out in the long term cable construction, a lot of this will require more construction, more permitting in the united states if we want to domesticate and take advantage of this buildout. We ought to be building these raw materials in the U.S. as well.
▶ 1:50:09Chair Lee: You say for every widget huntsman chemical produces or someone else produces using huntsman chemical products, something like this for example -- I will never look at these without thinking about science -- if you are able to innovate, you can produce the same number of widgets or more widgets with fewer environment to linpack's, including fewer emissions through technical innovation.
▶ 1:50:34Mr. Huntsman: Our industry does that as well as anybody.
▶ 1:50:37Chair Lee: The primary industry -- the issue your industry contends with involves the ability really a reliable power -- the availability of reliable power. Some utilities told data center developers additional power to fuel data centers can take up to a decade to deliver. That can be unsatisfying in the industry which needs to be nimble and move quickly.
▶ 1:51:05Chair Lee: What barriers exist within traditional utility business models to deploying large data centers at scale?
▶ 1:51:12Mr. Tench: I'm not an expert on the underlying business model for most of these utilities. I can describe what I observed in the interactions we have. When we begin our planning cycle we will submit applications for engineering studies which could take a year. They are coupled with other developers that are doing similar things.
▶ 1:51:41Mr. Tench: In some cases we are all attempting to serve the same load requirements. Utilities have a difficult job and sifting through 10 requests that may be for two projects that ultimately -- the response has been to require significant financial commitments to undertake the engineering studies and those take a long time. The need we have his speed and certainty.
▶ 1:52:13Mr. Tench: In our observation in the last five years across the country those factors move in the opposite direction.
▶ 1:52:19Chair Lee: Existing challenges coupled with the urgent need for permitting and regulatory reform . Manifest to us a problem on the knife edge of the problem. If we move in the right direction it can help bring about needed reform quickly. It can go the opposite direction quickly.
▶ 1:52:44Chair Lee: I want to just make a point to the comments we've had so far that puts it in context. As the wall street journal pointed out, "ira, the inflation reduction act, two subsidies for wind and solar. --turbocharged subsidies for wind and solar." it's a significant amount that is borne by the U.S.
▶ 1:53:13Chair Lee: Government and taxpayer. To claim these tax credits reduce electric rates is contradicted and undermined by experience. Wind and solar credits must be backed by gas plants or batteries which cost more than three times as much as baseload power.
▶ 1:53:39Chair Lee: The problem is not that there's anything inherently wrong with wind and solar being used to generate electricity. They have their place. There are things they can do. Baseload power is not something that the produce. When you need baseload power and nothing else will do, they don't provide that. Senator heinrich.
▶ 1:53:59Sen. Heinrich: I want to make the point that in my own experience the thing I find most intuitive is to look at the power in my own grid and asked the question, does that -- does what people represent line up with actual reality? On my grid we are 5% cold now. That is because coal is really expensive. We are 23% gas and declining.
▶ 1:54:31Sen. Heinrich: That's a very useful generation. It is hard to add to because you cannot get a turbine. We are 7% nuclear, which is great. It is firm and baseload. I prefer capacity factors. It has a good capacity factor but it's really expensive. We are 35% solar and 50% we are 35% solar and 5 15% wind.
▶ 1:54:56Sen. Heinrich: We are able to balance all of that with incredible reliability and consumers will not compromise on reliability. Most importantly, they also like low-cost. Did most of the country the average is paying 17 and change since per kilowatt hour for electricity. In my grid we are paying about 11 or 10.8 cents. It is bringing the price pressure down.
▶ 1:55:27Sen. Heinrich: It is providing the cheapest new sources of generation to replace the older, more expensive sources of generation. One thing we have to deal with here is the agencies and the role that they play in permitting new generation and transmission. Mr.
▶ 1:55:45Sen. Heinrich: Gramlich, if our permitting agencies, the department of interior which has added this new level of red tape, stalls were slow walks permits for generation projects which we are currently seeing in those permit projects as a result don't get on the grid or the get on the grid slower, what is the impact of people who pay retail electric prices?
▶ 1:56:12Mr. Gramlich: Obviously that will raise prices. What is happening is, love it or hate it, many utilities with their state regulators have put in place plans for the next three years how to meet load. They routinely go through these plans. The reality is, it is largely wind, solar and storage.
▶ 1:56:38Sen. Cantwell: 95 --
▶ 1:56:39Sen. Heinrich: 95% in most cases. If you take out some portion of that, say a third, what are you going to replace it within your 1, 2, or three?
▶ 1:56:52Mr. Gramlich: Curtailment.
▶ 1:56:54Sen. Heinrich: Exactly. Why I say capacity factors is because I'm an engineer and I don't remember a lot of the terms and buzzwords we get thrown around a lot here now. Firm, baseload, dispatch people. Whatever memorable -- what I remember is capacity factors. If you look at generation today, I have wind in my state that has a 40% capacity after. It's not perfect but it's pretty darn good.
▶ 1:57:23Sen. Heinrich: You know what else has a 40% capacity faster, Mr. gramlich? Coal in the united states. Everybody says it is firm and baseload and is not. It is not because it is expensive or unreliable. On the station goes down, the whole thing goes down. Not 3%, not 10%. You lose the generation until the thermal plant is back up and running.
▶ 1:57:53Sen. Heinrich: In your testimony you talked about the increase in demand for overtime. Doe also is predicting a similar amount, about 2% a year. They are claiming they are somehow a 100 full increased risk of outage -- fold increased risk of outage if forecasted retirements occur between now and 2030 as predicted.
▶ 1:58:21Sen. Heinrich: What where the assumptions that went into that, that were baked into that claim?
▶ 1:58:28Mr. Gramlich: The department of energy provided useful analysis with this report. I think they vastly overstated the retirements of generation. We have processes either through utility planning and markets to discourage or prevent retirements and that is happening.
▶ 1:58:52Mr. Gramlich: On the supply addition side there's a lot more generation that could come onto the grid and the department of energy study understated that new supply. If you understate supply and overstate retirements, you have a reliability crisis but that is manufactured by the numbers.
▶ 1:59:08Sen. Heinrich: We have not seen that in new mexico worked next door in texas where they have a totally separate grid for mars that they are bringing on lots of new sources of generation. Lots of new solar and batteries in particular. Transmission lines are such an important piece of all of this. They help us wield power around the country. It is hard to build transmission. That's why we need to actually do permitting reform.
▶ 1:59:37Sen. Heinrich: This committee did that last congress but has not this congress. I worked on one transmission line for 17 years of my life. Today it has facilitated tens of millions of dollars of economic output, facilitated the largest renewable project in the continent's history. It was not easy to get that done.
▶ 2:00:03Sen. Heinrich: If you create a system where the politics can change overnight, where a loan from the loan program office can be decided by politics rather than by metrics, what is the impact of that on reliability and on price pressure?
▶ 2:00:19Mr. Gramlich: So many utilities have testified before this committee over the years about the need for stability. They are making 60-year investments. 6-0. If the policies change every four years the simple he cannot do that. Your point is well taken. We need stability. Ferk is a great place as a nonpartisan agency that can do more in that regard.
▶ 2:00:50Mr. Gramlich: We need that regulatory stability for investment.
▶ 2:00:52Sen. Heinrich: Thank you.
▶ 2:00:54Chair Lee: Senator justice, then senator cantwell.
▶ 2:01:09Sen. Johnustice: Guy's, we have some smart folks. There's no question about that. I'm sure y'all are supersmart and I'm very proud of your contributions to this great country. I really thank everybody out here in the audience. I know you have family and everything. Congratulate everybody for being. Let me just ask you simply this or make this statement. Why do we continue to make this so much harder than it is?
▶ 2:01:41Sen. Johnustice: Really and truly? I'm from west virginia. I'm a new kid on the block and have a lot of white here and everything and I was the governor of the state for eight years. We did with logic and reason and businessman and businesswomen approaches and everything. All of a sudden we took the state that was flat, dead on its back anyway you can cut it to prospering like you can imagine in no time.
▶ 2:02:09Sen. Johnustice: We know in the energy sector today that a year from now or a year and a half from now we will hit the wall like nobody's business. That's all there is to it. We know that. We absolutely know the contribution of fossil fuels.
▶ 2:02:30Sen. Johnustice: If we had carried on going down the pathway of some, we want -- coal is the most terrible word in the dictionary. With all that being said, we want to get rid of all of it. What would have happened? There is no point in dancing around it. We would absolutely be deciding between homes in industry or homes and jobs.
▶ 2:03:01Sen. Johnustice: We could not do them both. There is no way. You know it. We all know it. All of you will know it. -- you will know it. Why don't we try to do something that the right thing? We know what the problem is. My dad told me 10 million times, you have to know how to deep you are in the hole and then we can try to get out. For god sakes, I don't care how hard you try.
▶ 2:03:30Sen. Johnustice: Don't confuse effort with accomplishment. We have to achieve right now. That's all there is to it. I ask you this, and this is the simplest thing I can possibly ask you. We all know we have to have reliable. We have to have a regulatory climate that can function. We know all that answers. Why don't we just get after fixing the problem/ ?
▶ 2:03:58Sen. Johnustice: From the standpoint of talking about the dangers of retiring all fossil fuels, whether it is gas or coal or whatever, can you talk about where we would be in this country today if we just decide, ok, that is what we are going to try to do. I do know this. West virginia, 83% of the power comes from coal. I do know there are states out there that don't derive a lot of power from coal.
▶ 2:04:28Sen. Johnustice: I was the guy that said embrace all but let's put subsidizing -- quit subsidizing and making it unfair against the others. If it is unfair, let's quit doing it. Talk to us about what I just asked. Talk to was pleasing go quickly. I only have a minute left. >> national suicide.
▶ 2:04:52Sen. Justice: I love it. I was going to say this before he started. I don't know peter huntsman at all. I have loved your bluntness. That's exactly what we need. We don't need -- we need to quit dancing around the rainbow. We need to absolutely do it. Go ahead, sir.
▶ 2:05:14Mr. Tench: We are at the edge in terms of having the power we need. We need to preserve and add resources every way we can.
▶ 2:05:23Mr. Gramlich: Your state is very different in his preferences the neighboring states. That's a good reason why states are largely in charge of generation choices and portfolios. I don't think the federal government needs to be meddling right now in specific power plants. Let's leave that to the states.
▶ 2:05:42Sen. Justice: Would we not all say if for being smart -- if we are being smart we have a situation that can become a national security situation. Would we not all say why in the world, just look at the countries of the world are trying to do today? China is building a coal-fired power plant every day. I'm exaggerating to make my point but they are not doing it because it's fun.
▶ 2:06:12Sen. Justice: They know how absolutely important power is. I thank you for being here. Mr. chairman, I defer.
▶ 2:06:21Chair Lee: Thank you. Senator cantwell.
▶ 2:06:27Sen. Cantwell: Good to see you gentlemen. I like the subject of affordable electricity. It has built the state of washington over and over again. We have had a robust conversation now with all of my colleagues from different parts of the united states about how to get there. I have not heard the word fusion yet.
▶ 2:06:47Sen. Cantwell: I certainly believe all we are talking about transmission capacity and various sources of energy, the united states continuing to be a leader in breakthrough technology is also a key component and important to the equation. Maybe somebody wants to address that. I wanted to talk about the need for more electricity in the ai revolution in this issue you were talking about, large amounts of composite material.
▶ 2:07:18Sen. Cantwell: I wanted to follow senator cassidy because it was a good lead up being from the state of washington and aerospace and transformation we want to see in aerospace with larger percentages of composite materials. Won't we be able to create some efficiencies by using ai and making it more efficient in the development of these very lightweight materials but also intensity in what it takes to actually produce?
▶ 2:07:48Sen. Cantwell: Won't there be a feedback loop that will help us?
▶ 2:07:50Mr. Huntsman: You are spot on correct. If you use the sciences of material to lightweight anything, is the simple laws of physics. It requires less energy to move that product. Whether it's an automobile or airplane. Yes, ai will greatly facilitate the design, specifications and raw material usage to do this.
▶ 2:08:17Mr. Huntsman: We need to make sure we have a permitting process in place that if ai can tell us to make this new product and we have the capability to altering the manufacturing footprint to make it tomorrow, I might have to wait three to five years for the epa to approve a new chemistry and that is simply not acceptable. You look with ai in material sciences, you are spot on.
▶ 2:08:42Sen. Cantwell: How do we accelerate that?
▶ 2:08:49Mr. Huntsman: He would be great if the epa would follow the laws that all of you passed to create kostka. They have 90 days to approve a product or not. Right now we have products that have been waiting for three or four years to get approval. I can build a facility in china for less time than that. If you're building composite materials, you are better off going some place else to the united states because it takes so long.
▶ 2:09:11Sen. Cantwell: We don't want that. We have a world demand for 40,000 airplanes without we are about to go to a major transmission we can build 100 planes a month. Wait, only if you get this next phase of composite manufacturing or thermoplastics right.
▶ 2:09:29Mr. Huntsman: We are ready to go.
▶ 2:09:31Sen. Cantwell: We want to see that related to ai and large-scale parts of the airplane. You articulated how much the current manufacturing prowess has given us some percentage, 18% to 20%, maybe higher percentage of an airplane with these lightweight materials. Now you can build bigger pieces and instead of taking hours to bake you can do them in a large-scale press.
▶ 2:10:04Sen. Cantwell: That's the thing in front of us. I was thinking more about what agencies or other people you think we need to get involved to get people to understand that ai -- we went to one of our national labs and were seen testing that was done that might have been done in the past by individuals. Very repetitive, formulaic process. Very time-consuming.
▶ 2:10:32Sen. Cantwell: Probably would've taken maybe years but certainly months. It was ai and automated and they just ran 20. They will get that chemical analysis done in a few months instead. That is what ai is helping us to deliver. How can we communicate this in a broader way that we get more people understanding with the opportunity is? .
▶ 2:10:57Mr. Huntsman: If you make it applicable to the average person. In cancer research, if you can apply ai, what are the outcomes for cancer identifications? The prices of your groceries because of growing seasons.clear message fear of ai taking my job and then needs to be supplanted.
▶ 2:11:25Mr. Huntsman: Every technological advancement in modern history has benefited larger society. Ai will do likewise. We need to do a better job selling that at the federal and industrial level.
▶ 2:11:39Sen. Cantwell: Fusion, good idea to make sure we are making progress?
▶ 2:11:44Mr. Tench: That is an exciting opportunity.
▶ 2:11:47Sen. Cantwell: Thank you.
▶ 2:11:48Chair Lee: Senator hoeven.
▶ 2:11:52Sen. Hoeven: You need power for your ai. How are we going to get more baseload on the grid? We keep adding sources. That is creating instability. You want to use a lot of power off the grid.
▶ 2:12:15Sen. Hoeven: Chairman lee turned his lights on and the lights don't come on returns the air conditioning on on a hot date in utah and it doesn't work because you are sucking all the power of the grid. We are having blackouts and brownouts, he will be unhappy and he has quite a temper.
▶ 2:12:33Sen. Hoeven: How are you going to get enough baseload out there to make sure you not only can do all of your great ai stuff you have been talking about but we keep the power on for our consumers that needed 24/7? You can go anywhere you want. I would like your opinions on that.
▶ 2:12:56Mr. Tench: What we have been talking about in the hearing is ways in which we can ensure we can get access to the electrons on the grid. The enhancement of the intelligence of the grid itself so it can be more adapted to the changes that are occurring. Use better the generation and transmission infrastructure we have.
▶ 2:13:25Mr. Tench: It is not enough in our position is we need to encourage as much new generation of whatever type as we can, including geothermal and etc.
▶ 2:13:35Sen. Hoeven: If you don't balance it out, you will have instability in blackouts. If he just keep adding wind or variable sources you will have problems. It seems a lot of people want to take hold off the grid. A lot of people seem to have a phobia about nuclear. A lot of people don't want to allow any transmission where those kind of things to be built. How are you going to break through that and get this done? You were bringing on a big-time demand for power at a high rate.
▶ 2:14:04Sen. Hoeven: Everybody kind of wants to go on like everything's going to be just fine and they will have all their powerful step not get the idea that we will have to do something. How would you practice mindsets of people put their shoulder to the wheel and need all these things.
▶ 2:14:23Mr. Tench: Hopefully were informing folks like yourselves in a position for regulation and the agencies will help. If we agree the ability for the united states to be dominant in ai technology is a matter of national security, which it is, hopefully that will rally folks helping us supply our influence and pressure or capital towards incremental sources of
▶ 2:14:54Mr. Tench: Generation and transmission.
▶ 2:14:56Sen. Hoeven: Let me add one more thing. Nuclear is going to take some time. We will have to change the way we can build it. A reasonable cost at a reasonable timeframe. We will need to keep baseload around for a lot longer. We will have to start putting some of these things together. How do we do that?
▶ 2:15:27Sen. Hoeven: It is not just telling the chairman about it. We have to get folks to really understand and buy into this we are if you guys are going to get the power you want for ai. A lot of folks see the potential of ai but some folks are not that thrilled about it.
▶ 2:15:45Mr. Huntsman: If I have $1 trillion balance sheet I'm always going to be able to afford the power. That is not the concern to me. If he has a $1 billion balance sheet, he is behind me. Guess he's going to pay the highest price and he will get the last bit of electricity. That is the way it's going to work. It's a pyramid. You are right.
▶ 2:16:13Mr. Huntsman: We need to be building out the baseload power which has got to come back to natural gas. That is the cleanest, fastest, most economical means of having a reliable baseload across-the-board. We don't have a trillion dollar balance sheet. We have been through europe, been through all these continents that have tried seven different ways of making electrons and they are virtually bankrupt. It doesn't work. It is not a theory. It does not work.
▶ 2:16:43Sen. Hoeven: That's what I'm getting at. Folks have to hear what you just said. That is going to be meaningful. That was very good. Any thoughts you have?
▶ 2:17:00Mr. Gramlich: We have heard a lot today about a balanced leveraged portfolio and the power system like power system lik a basketball team. You need it all. In the rapidly rising load growth we cannot be taking players off the court.
▶ 2:17:15Sen. Hoeven: I just think folks need to understand what we have to do here. How we all communicate really matters because we have to get going. Thank you, Mr. chairman.
▶ 2:17:29Chair Lee: Thank you very much. To wrap up, I want to push back a little on some of my colleagues' claims that renewable generation paired with batteries is somehow significantly cheaper and more reliable. It is not borne out by the data. Removals and storage have a significant scalability issue.
▶ 2:17:55Chair Lee: Backup power is required and needed when you have renewables and storage operating as a significant leg of the energy stool. It happens from time to time when they don't perform adequately up to the task.
▶ 2:18:12Chair Lee: When demand peaks this is especially true where is bound to happen with some frequency demand peaks for eight period -- a period longer than four hours. That is the capacity of utility scale batteries to hold power.
▶ 2:18:36Chair Lee: You will inevitably have times when the wind, the sun, some combination are not doing what they need to do when demand peaks. You have to have something to back it up. If we want to cherry pick data, look at some of the electric power costs in different parts of the country. Louisiana's retail cost is lower than new mexico's. The electricity mix is 70% gas and 3% renewables.
▶ 2:19:06Chair Lee: Utah's is around nine cents per kilowatt hour. Statewide grid runs on 77%: gas-fired generation. More specifically -- coal and gas-fired generation. Retail rates of about s -- renewables and storage have a place. They are capable of helping do their part to make the grid more resilient and reliable. Scalability is an issue.
▶ 2:19:36Chair Lee: We cannot forget the need for back of generating capacity. If we are going to have two grids to accommodate all that, it will get a lot more expensive. That drives a lot of the potential for our competitiveness, a lot of the demand for these things outside the united states and we don't want to lose that race. This has been a great hearing out I want to thank each of you for being here and for your testimony. You have offered phenomenal insights and I'm grateful for the participation of my colleagues as well.
▶ 2:20:06Chair Lee: You have made some great points. We will wrap up the hearing. The deadline for submitting questions for the record and any senator that want to do that must do so no later than 6:00 p.m. Tomorrow, thursday the 24th of july. Senators have until 6:00 p.m. This wednesday, july 30 to add statements for the record for today's hearing. Thanks to our hit witnesses and all of you who are participating. The committee stands adjourned.
▶ 2:20:37Chair Lee: Thank you.