Environmental: Sustainability and the Science Behind It

All right. Well, good afternoon everybody. So, we have some empty chairs up here if you're timid. And in the sides, I'm not going to force you to come up, but it's a lot better if you're up here because you can interact with them and sort of see them. And we do have empty chairs and they're just nice for you. So, come on up if you want. It's good to see you all. I'm Bill Barnett, professor at the Stanford Graduate School of Business and the Stanford Door School of Sustainability and uh it's my pleasure to introduce our panelists today to talk about environmental sustainability. Let's begin with Maxine Burrquette. Let me get your titles out here Maxine. Uh Maxine is the Emerson Collective Professor of Climate, Environment, and Society

at the Stanford Door School of Sustainability. and she is the faculty director of the center for just environmental futures at the Stanford Door School of Sustainability. Thank you very much for being here, Maxine. Thanks. Um and we have we're fortunate to have Bob Leman, the chair of uh climate related financial and macroeconomic risk initiative. So, thank you Bob. Um and uh David Hutchild, chair of the California Energy Commission. And so, thank you so much for coming all three of you. it's hard to get on your calendars. And so we were uh really fortunate to have you come. So here's how we're going to run this. We've got an hour total.

I'm going to do everything I can to give the three of you an opportunity to really open up and then as soon as possible turn it over to you for questions because it's a great time for you to be able to interact directly with these three amazing people. Okay. So, that's kind of my plan of action and uh so be formulating your questions and when the question time comes we have I see a stand there. Is there another is that it and there's another one here and so the way question for So there's a clock here, but it's not running. So if we could get the clock running because otherwise we will go forever. So you will want to make the clock go. Okay, there you go. I knew we don't have infinite amount time. So uh

look, everybody knows there's a hype cycle. Sometimes a topic is super popular, sometimes it's not. And uh in fact, I've been studying the hype cycle with respect to environmental sustainability. I was just telling the panelists on our prep call u we have now hit almost the all-time low in terms of the general uh perceptions of environmental sustainability and public discourse. The actual all-time low is in the United States was in 1980 uh the Reagan administration era when James Watt was appointed as Secretary of Interior. uh the all-time high uh at least according to the analysis that I've just completed was during the Biden administration. In fact, when uh Maxine,

you were playing a role in I'll never forget when I met Maxine, she walked into a conference we were having here and she said, "We just negotiated plastics and it was the that plastics treaty uh was incredibly important. That was the all-time high." And if you look over time, there's an up and down in the hype cycle. uh investments in the future. and um that disjuncture between what we're hearing and the underlying economic reality I wanted to first put out there and uh and then what I'd like to do now is turn to each of you and ask you to take turns talking about from where you sit how is the picture for environmental sustainability in 2026 and Maxine since you're right here I'm going to start with you please

yes thank you happy to be here happy to have this conversation. Um yeah, I always I to your hype cycle comment um the extent to which I'm in a breakout session versus a plenary is also a good indication of that and I think what we're seeing here is that this core issue with respect to leadership and business is in a breakout session is also sort of a an important flag. I'll just um summarize my comments this to this initial question with sort of three thoughts. Disinformation, disservice and global trends. I don't know if any of you were here for this morning's panel, but there's an excellent one on media and disinformation. If you were to uh pull the disinformation conversation together with the climate conversation, you have a lot of how you might diagnose

this moment. And we've seen uh climate move historically through this these um these sort of um impulses and uh movements of biodiversity and the impacts of biodiversity to think about the pollution crisis differently but it's kind of gotten in the churn of disinformation. So I want to put that on the table as a really critical way of understanding why we were we are where we are because the playing field is not level and unfortunately some of my colleagues even at the sustainability schools and climate scientists sort of assume that information is the currency when in fact it's other things and we can talk about that as well. Um disservice I think about in the context

of as a professor. Um it seems to me that if uh we're graduating law students, business school students, uh medical school students, although I'll say medical schools are doing this better, without understanding the state of the environment, without understanding the climate uh forecasts, current and predicted, um we're not preparing our professionals for the world that they will be uh working in and um and navigating. If you don't understand the risk that your uh company that you're um representing, whether it's in compliance or whether it's fire risk for a utility say um you're in this situation of not being fully prepared to be a effective advocate. Um and similarly in medical schools as you

see them offering more with respect to the health impacts of climate change. um you're not going to be able to serve your uh constituencies your populations effectively if you don't understand the circumstances that you're in. Now global trends very quickly what basically what you've described we see in theis um we are seeing in the curves you know downward trends and pretty dramatic downward trends in ways that we are not fully integrating into our planning but at the same time as you've also referenced there's so many opportunities not um given or quantified in a way that can be incorporated into balance sheets. And as those things become more evident and visible and legible, I think we're going to continue to see those business

opportunities be um undeniable and a part of the way of doing business. And then I can say a little bit more about this afterwards, but there is also a trend in which we all even with this polluted uh sort of communications environment, people still know something's up, right? And they're still wanting to do something about climate change. The polling suggests that they want to do something about environmental justice. The polling suggests that even though those words and terms are no longer um in sort of usable and acceptable company and certainly for grant applications. So I'll say those three things now to sort of open up the conversation.

Wow, great start. Uh Maxine, thank you very much. Bob. Yeah, thank you Bill and it's a pleasure to be here. I think you raised the right question when you asked about investment and you say, well, it's it's continuing. The problem is that it's a small fraction of what it needs to be and that's the essence of the problem. When you talk about climate change, we know where we're going and we know what we've got to do. I think that's common knowledge now, but we're not moving. And we're not moving for a very simple reason. We don't have the right incentives in place. the fundamental problem is that we're not pricing the risk of climate. Now, my background, I'm an economist, by the way. I was in the

inaugural class here at Stanford of the human biology program. So, I'm showing my age a little bit. That was 50 years ago. Now, wait a minute, Bob. If it was if you were in human biology, that meant your parents wanted you to be a doctor. That was about a third of the class then, and I think it's a third of the class now. Right. In any case, no, I became an economist and u and then a risk manager on Wall Street. And so when I uh retired uh 15 years ago, it was very natural for me to focus on climate as a riskmanagement problem. And it's a global problem. It's not just the US,

but it's certainly true that in the US today that the winds are, you know, strongly in our face and we're playing defense. But around the world, that's not the case. In fact, uh I was called to testify three years ago before the Senate Budget Committee with uh Mark Carney and a Republican uh economist. All three of us said, you know, what we need to do is put a price on emissions. There was no, you know, uh question about that. Uh but we haven't done it in the US. Now, at that time, one of the questions I got was uh John Kennedy from Louisiana. He says, "Bob, do you really think China is going to reduce its

emissions, is going to face climate change?" I said, "Yeah, because they're going to real realize the reality of it." Well, here we are just three years later and China has taken over this entire space. They've got like 90% of the investment in clean energy right now and uh and the US is falling behind. So, that's where we're at and uh and we know what we have to do. We have to put a price on it. But until we do that, we're not even getting started. And so time is a scarce resource when you're managing risk. And I feel very badly for, you know, the next generations because frankly the world hasn't started. It's just getting started. And I guess the final thing I'll say is there are some very good

signs uh outside the US. uh you know Mark Carney gave what was a very well-received and I think important speech at the World Economic Forum this year. He said you know the global system has ruptured and now uh countries are going to get together around specific issues where they have commonalities. Well, he didn't mention climate but that's clearly what he was talking about. Sure. And we now have such a coalition. It was announced at the COP. It's called the uh open coalition on uh compliance carbon markets. It's got 18 members. Uh and it's it's a very positive sign. It includes Europe, it includes China,

includes uh Brazil which of course led it, Mexico, Canada, Singapore, Norway. So these are the countries that are recognizing reality. They're moving forward on their own and the US is going to be left behind especially in terms of business if we don't change course soon. Well, well put, Bob. You know, it's interesting Maxine, you kicked us off with uh just a set of observations around both the technical reality of climate change and issues of sustainability and the deep moral implication of them in your reference to uh environmental justice. And that third lens though, the behavioral lens is right where you're going on this Bob. And you know, and you need all three, right? We need to understand the technical reality, the

moral reality, but also behaviorally. How do we get there? I see over there one of my colleagues, Bard Hearthstaff from the sustainability school and the and uh there may be some others here. uh and uh you know Bard his research looks at exactly what you're talking about Bob but with models that apply to contexts other than the United States because that's often where we're seeing some of the best uh innovation with respect to policy and uh so a little bit of plug for uh for the social scientists in the room. David, thank you for your patience. One of the things about being a policy maker is that you have all three lenses going on at once. you have to think about technical

reality, moral issues of justice and the behavioral reality. What's your view of sustainability 2026? Yeah. Well, thank you. Good to be here. Thanks for having me and good to be with Maxine and Bob. Agree with all their points. Um, I want to strike a more optimistic note actually, which is that I think we underestimate the power of states to lead the energy transition. I want to just kick it off with a little bit of a kind of a success tour about what's happening in clean energy in the state of California today. U because we are um we're kicking ass. We're at 67% of our electricity on the grid in

California, which is the fourth largest economy in the world. It's coming from clean energy sources. Alternative energy is the wrong word to use to describe renewables. Fossil is alternative on our grid. We have more EV charging plugs in California than we have gasoline nozzles. We're adding 1,200 EVs a day. It's up to one quarter of vehicle sales. In new construction, 10 years ago, only 1% of homes in California, we build about 120,000 homes a year in our state, only 1% were being built all electric. Uh today, it's over 80%. Uh and we're seeing just some absolutely landmark projects get done. We just started construction on the Darden project, which is the largest battery storage

project in the world, $5 a half billion dollars in West Fresno County. Um, and one of the things that's happening is we're adding storage. We've been actually it's a real um highlight of why clean energy is so exciting, which is you can add this capacity so quickly. So we only have 105 gawatts of utility scale capacity on the grid in California since electricity came to our state in 1850. Okay. So 176 years 105 gigs. Okay. 30 of that came on since Gavin Newsome was governor and half of that 17 gigs is energy storage. And so it has allowed us to hit these incredible milestones. Last year we got to 100% clean energy on the grid for a portion of the day uh on 279

days. That's never happened before. So the majority of days we're getting to 100% clean energy. You know, we're averaging like five hours a day at 100%. Um these are milestones that people, you know, would have considered mythology even a few years ago. Um and some very promising templates are being created. you know, just across the bay in Oakland. Um, that city became the first city in the United States to achieve 100% of their school bus fleet being electric. 74 buses, 74 chargers, 100% of the kids going to school on a public bus or going electric. We know that diesel fumes get into the cab of the bus. It's

a health issue as well. And those buses are now collectively when they come back, they feed surplus power back into the grid. It's the largest vehicle to grid project uh in North America. Uh we're building five battery electric fairies for the San Francisco Bay, the first battery electric fairy fleet in the country. And so I think I just want to invite everybody to see what's happening in this state as a sort of postcard from the future um and not you know in large measure because you know our governor is you know now very much uh on a path to be the next president if things go the way they're going. I think um what we got to do better together is tell some of these success

stories. I'm really struck by how much of this I think really significant milestones are totally unknown, right? Uh and I think we got to get better about lifting up those success stories and I think the biggest one of all is that doing this stuff, addressing the climate crisis, the sustainability Maxine talked about this is good for our economy. Okay. 12 years ago, we were the 10th largest economy in the world. All right. The critique we took as a state when we did the 33% RPS in 2011. This is going to devastate your econ. I was there actually. I was in the gallery. One of the members of the legislature was violently opposed thing took the bill and threw it up in the air and said

there's this sort of snowflakes coming down. He's saying this will never happen. It's going to be a calamity for our state. and so on. Um, we went from the 10th largest economy in the world and as we have cleaned up the grid and advanced all these clean technologies, we passed Russia, we passed Italy, we passed Brazil, we passed France, we passed the UK, we just passed Japan and we're the fourth largest economy in the world, right? And so the argument that climate solutions, clean energy, investments, innovation are somehow bad for the economy is just the opposite. And so I think we got to do a better job about messaging all that. And I just would close with I you know talking to

young people I do think this whole sector offers hope. These are fields like people are excited to get into and so there's a real um marriage with you know California industrial policy. I look at something like offshore wind and what we can do with port upgrades and construction of the necessels and the towers and the blades and how many new jobs that can create. these things come together beautifully and I think they're career paths that a lot of young folks are excited about. So, we got to, you know, hunker down and make it through this uh storm, but I think we will. And oddly enough, I think Trump's war on Iran is going to undermine his war on EVs and renewables. And actually um

we're seeing that now in the market. I mean, uptake of these clean technologies. And I think even if prices go back down in fossil fuel, we know the volatility is always going to be a threat. And so, and I'll just close with this. Um, I just came a month ago. I was at the uh Tesla electric se factory in Sparks, Nevada. Okay. So, four almost a $4 billion factory. They're making electric truck that goes 500 miles on a single charge, recharges in 35 minutes, and they're going to make a thousand of those a week, right? Um, and by the way, these trucks don't have to slow down going up because the electric drive, you can pass a car going. So, I think we're going to see, you know, real

transformation of this um of all these sectors that we had thought were impossible even a few years ago. And I think all the instability in the fossil fuel markets we're seeing today are just going to uh accelerate that. So, a lot of challenges to get through and certainly a very hostile federal government, but a lot we can still do to move the ball forward at the state level. Wow. that uh so you what I'm going to do is ask both you Maxine and you Bob to respond to what you've just heard but I'm only after I give my response okay because I just uh was that awesome I would love first of all I'd love to have

you come speak to the freshmen the climate scientist Chris Field and I teach sustainability to the freshmen and just think about teaching sustainability to the 21st century that's right because there are all these babies in the room, right? They actually come to class in pajamas. So, uh whatever. Uh but it is uh you give them the sobering reality, right? We teach the truth, but you also talk about the actions that are happening because that's what's uplifting. Doesn't mean we're doing enough, right? Someday we will remember that we weren't doing enough. We understand this problem of time inconsistent discounting. It comes out a lot of the literature, but action is happening and it's so in it's empowering to hear

you speak, David, about that. Maxine, what's your reaction to what you hear David saying? Yeah, I mean, I think that um there again, this has been a story of a lot of missed opportunities and beautiful moments. So, when Carter installed the solar panels on the White House, he said this, you know, and by 2000, this could be a curiosity or the greatest adventure we would have ever embarked upon. That was in 1979. Wow. And so I do think there's so much beauty in understanding this as a moment of possibility. And that's in fact what this future center is about is um understanding that we have to repair the past and we have some very present

um challenges to face. But what are the futures the preferred futures that we'd like to build and that's the conversation we had actually in this very room uh in partnership with the business school. And so I think that there's something to be said about the opportunities that are present. Of course, there's also something very clear that the adverse is true as well, which is that if we continue down this path, it's really bad for the economy. It's really bad for human beings in the moment and then of course the um next generations. And so that those are my thoughts and it's it's really exciting to see that the um the sort of stated hypothesis about the benefit of doing and making these changes in energy landscape for example, it's actually bearing out in a state

that's you know undeniable and is a leader for other states across the country and the world. Yeah. Thank you, Bob. Yeah, I guess I have mixed feelings because on the one hand, it's great that California is the fourth biggest economy in the world and it's moving quickly. Uh on the other hand, uh you know, where we're at today is we haven't really gotten started. So, let's be honest that the right price, the right incentive to reduce emissions is on the order of $100 a ton, maybe $200 a ton. And in the United States right now on average is essentially zero. We actually have more uh more subsidies for fossil fuels than we do for you know clean energy. So uh we have to be realistic now. I think we're going to move quickly. This

is an emergency. This is an absolute crisis that we should have addressed 30 years ago. And had we addressed it, we'd be in a we wouldn't be a problem. we would be on the road to solution. We're not there. Bob, let me come back uh in on this. It so I my research is on uh the evolution of industries. Okay. And so when you look back over the last 200 years, change has rarely happened because governments soberly and rationally orchestrated the transition. Typically change happens despite governments and only later does government policy at best retrospectively rationalize what came out of the creative destructive process of uh entrepreneurship

displacement and a replacement of the status quo by visionaries who have what looks at the time a rational an irrational view of the future. And so I hear everything you're saying, but that could have been said at the beginning of the uh digital revolution. It could have been said at the beginning of the mechanization revolution of the 1800s. So in a way from my view, I think you're both right or all three of you are right. The government policies are not what uh they should be. If you look at the design that would come out of a Bart Hearthst paper or a Bob Litterman paper, they're not even close. And nonetheless, we're seeing change happen.

Well, what do you want me to say? It's not, you know, these are only going to happen together. Without government, you're not going to your point though, I just want um you know, when Trump ran for office in 2016, coal, right? That was the main bring coal back, right? more coal got retired under Donald Trump from 2016 to 2020 than under Barack Obama because renewables uh you know were cheaper and now um in the first year of the Trump administration you know part two uh in 2025 I just got this data yesterday you know 91% of the capacity additions on the US electric grid were clean energy you know why is that is because we have been winning on cost reduction. You know, in um 2004 it took a year to install a

gigawatt of solar globally. In 2010 it took a month. In 2016 it took a week. In 2023 it took a day. In 2024 half a day to install a gig. And um you know now it's over half a trillion dollars a year. It's the single biggest investment on the global electric grid. And we've seen just, you know, since I got into the field in 2000, you know, solar panel prices were $5 a watt. I just did a project for a friend of mine's hospital in East Africa. You know, 12 cents a watt. It's cheaper to buy a solar panel than a piece of wood that size. Okay. So, we're at this point where you can't put the genie back in the bottle. and the even the elimination of the tax credits which is a big deal. It's a 30%

tax credit is not enough to stop the growth of solar and I think a really telling indication of that you know Google just acquired Intersect which is the largest like developer of large scale solar and storage. Um and that's a really stigma like how are we going to get power for you know data centers and so on. uh and they spent three times more on that acquisition than they did on YouTube, right? So, some of these forces are just larger than what Trump administration can stop. They absolutely can impede and they are doing that and they will slow this transition, but they cannot stop it in my view.

All right. Well, so you've heard from you've heard the opening salvos from our three panelists. I'm now going to open it up to anyone who wants questions to wants to ask a question. And I know the way these things go. What you do is you step up to one of the mic stands and then we'll let you ask a question. And what's going to happen is people are timid at first and then later when we run out of time there going to be people who are looking at me like, "Well, why didn't you call on me?" So if you have a question, get up to the mic stand early. And you panelists feel free to ask each other questions as well and to jump in on the conversation. So uh we looks like we have our first question coming over

here. And when you ask a question, please begin by clearly stating your first and last name. That way, folks can come up to you later and talk with you about your uh your question. Go ahead, please. Thank you for the comments. I'm I'm Richardson. I'm chief economist. Okay, let's we're going to try it again because it's the mic's not on. Okay, there you go. Uh we can hear you. here to speak up. Hi, I'm Nila Richardson. I'm chief economist and ESG officer for ADP, which is a tech and HR company. And I guess I really appreciate your comments, uh, especially what's going on in the state

of California. I was wondering if you could give me your perspective on the scorecard for corporate America. Um my read is that a lot of companies both manufacturers and service sector firms are very focused on reducing emissions by a certain date both their scope one their scope two sometimes even scope three uh there's a market for VPPAS and trying to offset those admissions and yet there's a lot of resource intensive AI development going on at companies so I just wonder if you have a perspective on what corporate America could do to continue to meet these emissions goals and how are they doing especially in the face of AI.

Wow, great question. Thank you. Wants to take that. Uh I so mixed bag. Uh I think I give a lot of credit to you know a number of the companies that have set these 100% clean energy goals and to some of them like Apple that are going not just making the commitment to do 100% uh clean energy for their um their facilities but going upstream and requiring that their suppliers as well. Uh but you know hugely disappointed with the American automaker sector those OEMs backing off of EVs. I think it's industrial suicide. Um, China is now, you know, this year 60% of new vehicle sales in China are electric. You know,

countries like Norway of 97%. And, um, you know, I do think we're seeding the future to, um, countries like China when we do that. So, I have been disappointed with the automakers. There's some that are stepping up in some ways. Um, but I think it's a mixed bag. I'd be curious what, you know, Bob and Maxine think. Yeah, I it's a mixed bag. All right. And I'll just say, you know, uh all these companies that made lots of promises uh voluntary, they're pulling back on them, you know, and it's not surprising. People react to incentives. If they have a price on carbon,

they're going to create, you know, lowcarbon uh goods. If they don't, like we don't, then they're going to, you know, produce what they do and make the biggest profit they can. So I can't blame uh corporations. Uh what we need is we need a price and then corporations will move very quickly. Uh but you know I again uh the big picture here the IMF did an estimate a couple of years ago about what's the subsidy to fossil fuels in the United States. It's a trillion dollars a year. Well they said 700 billion but then they had a lower cost of you know social cost of carbon than I would put on. But in any case, it's on that order, a trillion dollars a year.

Compare that to the uh you know Biden uh you know inflation reduction act that was going to be $400 billion over 10 years or 40 billion per year versus 700 billion the other side. It's just you know there's no comparison and business is not going to move until they have the right incentives. That's just the way the world works. You want to jump in next? Yeah, I do. I mean, I think I don't know that it's a mixed bag. I think it's pretty poor um corporate activity. Um and um I mean you know sort of my experience historically um in various spaces I've been in and then of course in this current moment it seems to me that the fact that we saw this kind of you know rapid flight away from these promises was sort of expected and it can be

incentives but it also is that so the anti-regulatory push also uh allows for the bottom to be you know rock bottom to continue to be very far below us or above us depending on your perspective. And so we are in a situation where um you are incentivized. There is an incentive. The incentive is to you know maximize profit without any consideration for any other um element of your business. Um and so you find that again there is a bit of a race to the bottom in terms of the way business is done. Um and we have you know evidence of that. I mean even in the previous administration and we're at sort of the height at least of the promises and the pledges that more money was being invested for example in

oil and gas in the greenwashing and the statements about what they are doing and versus the actual move from the business as usual to um other sources of clean energy. And so I think that there is a there's a systemic kind of rot there to be perfectly frank. um and it is one where there could be an agreement to uh to higher standards that may include regulation that it's you know that is um is necessary for a leveler playing field that's not happening. I'll also say that I mean we have an um this opportunity to understand the vulnerability again of these companies themselves. I mean this is sort of in some ways a um a very short-sighted set of um decisions that are being made. Um, and we are not

looking as well. We're thinking a lot about the climate crisis, but of course there's the biodiversity crisis, which I cannot underscore enough is also we're hitting a really significant cliff here. And if you are uh if you enjoyed a cup of coffee this morning, um I urge you to think about the biodiversity crisis, the what's happening to the bees and you know, we get sort of pillaried as tree huggers when we talk about it, but just the pure business um prospects of this are significant. There is no economy without an environment. Um and a degraded environment gives you only so much for so long before we hit those cliffs as well. Yeah, well put, Maxine.

I'm glad you bring that in. You know, when you go back to Rachel Carson's book, Silent Spring, back in uh was it 1962? I think uh she doesn't talk about climate. Yeah, it was about biodiversity, pollution. The silent spring refers to a possible future without the sound of birds in the morning. And uh so the sustainability challenge is multiaceted. Now, for those of you who think, "Oh my gosh, I knew coming to this session was going to be a buzzkill. I mean, my gosh, I could have gone to some other." Let me tell you this, the beauty of this new instit.

Yes, I'm going to plug the new institute. Okay? So, the beauty of this is that we will hold the line on speaking the truth regardless of what is popular. And that's why you three are here. We have quite a line of uh people wanting to ask questions. Please go ahead. Hi there. Uh, first of all, I want to thank the panel for being here. Appreciate your time today. And your full name? Yes. Uh, my name is Chad Sario. I'm a fourth year PhD candidate in material science and engineering. Uh, when I started my PhD here was in 2022. So, there was some tailwind and after the passing of the inflation reduction act,

felt really energizing to be here, especially at Stanford at the time and being in this like innovative ecosystem. I've also now have been here long enough to see then a lot of the IRA stuff be pulled back. Um I'm really curious what the panel thinks about this idea of how we build durable legislation and policy especially to signal to our allies abroad that we are serious about climate change. Um I hear from people saying that they're unsure if they want to you know work with the US if we keep on changing our policy on climate every four to eight years. but also you how do we signal for people in industry to invest long term in these sort of areas investment um going back to what um

David said like is it do states have to take up a larger mantle here or is there a national thing that we could do really curious to hear uh your thoughts on this question thank you great question durable policy well I want to say first thank you for that question but first bill Um, this is I promise you I'm a lot of fun and super joyful and even though this tends to be a downer conversation, it's a Yeah, the she is actually we're in the same department. It's really important and I think we don't have to be you know there does have to be delusion in order for there to be um joy and in fact the work is joyful because we understand the stakes and again the opportunity and so

just wanted to sort of suggest that like you know we can I'm I'm happy to break out and dance afterwards to prove my point but the idea here is that you know we're at you know these are important moments um choosing the future that we want and I think it can be a joyful one still now with respect to the question I mean it's a really important one um I think you it's safe to say that credibility has been lost um internationally and credibility nationally is also an issue and so first things first is just really regaining trust and credibility in our own home if you will um and I know that there's a panel that I'm certainly eager to see this afternoon that's going to talk about trust in our society but I think this is really important to

understand when I got to the state department after um in 2021 yes we had to convince you know partners across the world that this we were serious um and uh and it was really difficult and so now we are definitely in I think a multigenerational um renewed effort that we'll have to um engage in once we can um to regain trust across the international um community in this space but you know there's nothing like doing the work to demonstrate that and we I think can still um rely on what is a very real um desire in our country to do better in this way. Um, and the polling suggests as much. Again, my colleague John Crosnik, um, at the Dorf School, um, he's also in political science and other affiliations. He's

excellent. He's done some really excellent, um, polling around people's, Americans support environmental justice. I'm using that as an important example because we are in this time now again where it's like verboten to use words like justice and recognize that there is a history of racial hierarchy in the country and in the world. But here we are in this moment and he does research and it suggests that 85% of Americans are supportive of environmental justice action by the government. There are definitely some questions around how it's done. Um but even in the context of a specific policy 60% twothirds are supportive of this kind of intentional action. And that suggests to me that um it's the term is sociotropic

considerations. But humans over and over again in this kind of polling suggests that they want to do the right thing and given the right information um they will make those choices even if it seems to be against their economic interest. Self-interest was actually uh negatively correlated with your reaction to that question or your uh the possible implications there. This is all just to say that I think um we have to be very um uh we have to rebuild trust. We have to um have conversations and not shy away from these um these issues and concerns that are going to pull us back I think together. And durable policy oftentimes happens at the community and grassroots level. And so not recognizing

that power is also going to be to our detriment if we continue to look just at the top uh down solutions. All right. Thank you, Maxine. Bob, David. Well, I would say one of the uh very positive things that's going on now is that Trump has destroyed, you know, the global system that was not moving forward. So, the UN now is no longer really leading on climate and that creates an opening for a coalition of countries to move forward. You know, when we were in the UN context, you had to get unanimity to move forward.

Yeah. Interesting. There's plenty of pro states for which it's not in their interest to move forward quickly. So they were saying, "No, no, no, not so fast." So nothing was getting done. Well, we said, "All right, forget it. We're going to move forward together." And that's most of the rest of the world. The US now is kind of caught as a pro state. And uh you know that's I don't think that's going to last for very long. But the sooner that ends and the sooner we join the coalition of countries that are moving forward, they're going to put a price on carbon and they're going to put a tariff on countries that are not part of the coalition. Yes. And so that creates an

incentive for countries that are not part of the coalition to join and they've already got a significant part of the global GDP. So if you start getting countries like uh I would watch India, I would watch Indonesia. if they start joining this open coalition pretty soon it's going to be a dominant coalition and the whole world is going to have to go. So I think that's a very positive change. The other thing I would point to and Stanford is very involved in this is uh carbon accounting. Yes. You know when people talk about carbon accounting they think you're talking about emissions scope one scope two scope three. That's not accounting. And there is a push now uh to create

actual accounting where you follow the molecules through the economy and that allows you to put a price on carbon that's moving forward as well. And so I think those are two very positive signs. Uh and uh you know hopefully they'll move forward quickly. Oh thank you Bob. Okay. Yeah you're right. Yeah. No we have quite a few. Thank you very much. And so here we have from my so Isaac from my class. Thank you so much for coming. And not in your pajamas either. He's never come to class in pajamas. It's the other students who come to class in pajamas. So just Well, thank you very much, Professor Barnett. Like he just mentioned, I'm

Isaac Stlo. I am an undergraduate freshman about to t start an internship this summer with the California Air Resources Board and or related to electrification of the port of Oakland. And so one thing that they talked about in class was one of the key factors towards reducing our emissions is going to be greenify all electricity and electrify everything in your guys's eyes. What would that look like? How realist how practical is that andical is that and where do you think we are in achieving that? Yeah. So I think that's exactly the strategy and we're absolutely on a path to do that. So as I mentioned we're um basically about 70% clean electricity today on the grid. The law that Governor Newsome signed requires us to get to 90%

by 2035 and then 100% by 2045. Countries like Denmark, I just came back from Copenhagen. uh with my daughter last week. They just had the last month the entire country ran 100% on clean electricity. Why is this possible? It's because um energy storage has reached this point where it can be deployed really quickly at enormous scale. You know to build a new combined cycle natural gas plant in the United States um takes seven years. Okay. To do a new nuclear plant, we only built two new nuclear plants in the US this century. you know the last one Vogle 2 in Georgia took 17 years right these storage projects are going in like 12 months and so the build because they're

actually very simple technologies and um and very modular and so it's it's very achievable the I think the so my view is basically we're winning on greening the grid the real game right now is what you're working on which is electrifying end uses you go to the port of Long Beach they have electrified their key cranes their gantry cranes their vehicles you know all of these things um that we didn't think were possible from, you know, I use a chainsaw when I'm doing yard work. I have electric chainsaw. I didn't even know that was a thing. I love it. It works. It's like, you know, as I mentioned, um you know, the Tesla Semi, we have a company in LA called Harbinger doing the class 4, five, and six trucks like for UPS and

FedEx. Uh they're at cost par today with no incentives and next year they're going to be lower cost than conventional. uh and companies like FedEx because of that made a commitment to get to 100% zero emission vehicles by by 2030. And so we just have to push in all of these areas. Um and as we do that, do a much better job of lifting up the success stories because it's just not getting attention. Um and so we're doing that. We've started a bunch of public private partnerships. Uh one this week is actually heat pump week. We put $8 million in this uh partnership with the heat pump industry to get people to adopt electric heat pumps. And we got to just be doing a lot more of this to help

get the word out. And because I will say, you know, you can vote right a second time. That's not the ballot box. It's about how you live. What do you drive? How do you heat your water? How do you There's a chance for uh sort of participatory clean energy democracy with these solutions. That's not possible. Um you can't put a coal fired power plant on your roof, right? And so that is one thing that's really exciting. There's actually actions all of us can take in our homes and in our companies um to adopt these technologies. Okay. And um I just I do want to add a little bit here because I know especially in California that the tech optimism is very significant and for good reason.

I mean there's a lot that's going on that's right. I just want us to remember as we're rolling all of these very important um new technical strategies out that we're we're not forgetting nature and human dignity. And there there a couple reasons. One is that um the national environment is going to be shifting and is continually shifting. So if you're in a circumstance of drought um and you need significant water resources for your, you know, whatever it is that you're you're inputting, you have to be very mindful of what the state of your natural environment is and I think be um in harmony with that. But also human dignity becomes a really key part of this. Not just because social movements can kill good ideas in terms of the

technical outside of things. If you don't want we've seen this happen in a number of circumstances where big wind projects or other u renewable energy um efforts have been in conflict with community needs or wants and that becomes a significant hurdle to them being um rolled out. So that becomes really important. But similarly, when human dignity becomes more compromised, you often see the same kinds of, you know, sort of um evolving or snowballing effect of environmental impact over time. And those two things like sacrifice zones, which environmental justice communities have talked a lot about um really are coupled and um and have gotten us to in some cases to a lot of the environmental degradation that we see that's gone beyond the

typical EJ communities as well, whether it's in Appalachia or um in parts of um Cancer Alley in the south. So really important that we don't um we don't forget the importance of these elements of the work as well. Yeah, I'm I'm so glad you bring that up uh again, Maxine, and it of course it's uh it's something you do uh as a big part of your mission. Um, and I always find it striking that we think of it in the context of uh inequality and uh and environmental degradation here in the United States, but that's also true globally with massive differences obviously in the uh in the treatment and plight of populations uh that we can't leave out in order to get to that new future. That's right.

Well, thank you for that question, Isaac. And who do we have now? Hi. Um, I'm Megan Guy. I was actually uh GSB and EIPER 2010. Um, and I've sat in a lot of these rooms for recent decades. And Maxine, you've maybe teed my question up a little bit. Um, I think the conversation has very quickly, especially in the last decade or so, gone to climate, to energy, to putting a price on carbon, you know, credits, etc., etc. Um, and I wonder a little bit if we've missed the plot and made a bit of a mistake um by focusing too much on the economic story at the expense of uh talking about things like oceans, like biodiversity, um, indigenous knowledge, uh, you know, redistributive um, impacts, etc. Um, and so I'd love to

hear a little bit from you in this moment when uh companies are not speaking out on many things about what role do you think the business community has in talking about uh the environmental crisis that we're in beyond just the impact on their bottom line, their profitability um and kind of I guess what we've we've called the more economic lens of ESG to date. Thank you for that. I would love to hear what you all think, but because I certainly do have thoughts on this, but maybe uh I really appreciate that question and I think um you know, one thing that I probably the most rewarding part of my job as chair of the energy commission

has been engagement with the Native American tribes in California. So, we have 109 federally recognized Native American tribes. I've been with the tribes the last two days. Uh the Pesca tribe and all these tribes their identities are very tied with species. Okay. And so um and there are some by the way some really beautiful things that are happening. I'll just share I think I think it's the single most inspiring restoration story uh in California. So in the north coast on the Clamoth River, you know, the salmon run has been stopped for years by these four dams. uh and this is in the Euro tribe territory and they led a 20-year campaign uh to get Berkshire Hathaway to take down those dams. That finally

happened last year. It's the largest dam removal project in the world and the salmon run is restored. Um that's a sacred species for that tribe. And at the same time, the California condor, which is an incredible bird, lives to 75 years old, 9 and a half foot wingspan. It's the highest flying bird in California and in that region. Um they don't eat anything that is alive. They only eat kerrion. And so 100 years ago hunters came in, they shot with lead bullets. The you know the condor would eat the carcass, get lead poison and die. So condor went extinct in that region. The population condor went down to 22 birds. They did a really focused incubation program led by the tribe. Um and this bird is to your point

about like how to talk about this. This the bird is seen as the um medium for humanity's hopes to be expressed to the heavens and also because it flies so high to confer wisdom to the people. And so you can imagine the impact on the tribe like having this bird be absent. So they reintroduced the condor about five years ago, six chicks a year. They're up to I think um 26 birds now. And last month for the first time in a century uh there a pair of condor paired up and there's an egg incubating right which is beautiful. And so I think we don't talk about this stuff enough um and it is um you know it is a core part of who we are uh and what we need to talk about. I think we can get a

little bit too cerebral. I think we do need to make the economic case because that's the world we live in. But you're absolutely right. we need to elevate that dimension as well. I'll just share that I mean I think we I always struggle with this sort of I think false dichotomy between economy and environment again because what do you need at the end of the day? Well, we need water for these data centers. We need you when it comes down to it the elemental pieces of this are the same. And so um I just want to I think we need to sort of think uh carefully about um how whether it's business leaders or the business case can be made understanding that we live in the

context of an environment that's absolutely where it is happening. Um and to call in um the Aremis astronauts they all wanted to come home right and they had a very clear statement of this is home. I don't I love space um and I love these kinds of notions, but what this is also, I think, um asking us to do is to be in awe again, right? And that's a big part of what's missing. We know that's what's missing. We can hear from the mental health conversations, the podcast, etc. about what we need um and what is important. And that's a big part of it. And it's also important because as we think about um indigenous communities and Native American communities, we understand and it's very clear what is sacred, but we

also have a lot that is sacred in our culture and our society. Um and so I think being able to bridge that with our understandings of what thriving and what prosperity is, what's in our national interest. I would offer that a habitable planet is in our national interest and our economic interests. Right. I would just add that, you know, business is not a problem. Business will solve this problem. And it's just the problem is we're not moving fast enough. Yeah. And business is not moving fast enough because we're not telling it to move fast enough. It's it's the fact that we don't have those incentives in place.

Businesses are there to make money. That's what they're going to do. And as long as we're telling them we're going to subsidize fossil fuels out the wazoo, that's where they're going to make their money. That's that's it. the beginning of the story and the end of the story. Could you say more about who the Wii is? Who we government? Government. It's government that sets the incentives. And right now, we're subsidizing fossil fuels by not recognizing the risk that they create. So, we're subsidizing fossil fuels. What do we expect to have happen? Now, this government, you know, maybe Trump will be such a disaster over time that we'll shift and we'll start pricing emissions. Many other countries

are doing it. Obviously Europe is doing it. China's moving in that direction. As I say, there's a whole coalition now around the world that's going to move in this direction. The question is, will we be part of it or not? My guess is not. I'm sensing something is welling up in you, Maxine. Well, I have a lot of thoughts on this because I think the Wii is easy to uh it's easy to state and I think it makes a lot of sense, especially if we assume that we're in a functioning a well functioning democracy. But if we're talking about a wei being equal in government and government presumably being formed by the people, then you have challenges like citizens united, you have legal challenges that are making it harder to, you know, sort of

participate in a democracy in a healthy fashion. And so I do think we should be more precise so that um at the very least we're not all feeling guilty. How many people love coming to an environmental session and feeling like you are not recycling enough or whatever it is? Now you're not doing democracy well or telling business to do the right thing. business is also frankly um I do quibble with legal personhood for the business but I certainly know there a lot of people in there and so they can make better decisions about how they engage with government as well with again with respect to uh openness to

sensible regulation and the panel this morning and other spaces will talk about how that's done very differently in other societies and other uh governance regimes like the EU. So, we really need to, I think, push on the people that are involved in whether it's the private sector or in our judiciary and the conversations that we have about what it means to be a citizen these days and what that power confers to you truly to make change. Right. Well, it's a sign of a good question is one that really brings out the kind of deep uh underlying logics that I think we're seeing here. I can't promise I'm going to get to all four of you in the next six minutes and 50 seconds, but we'll try.

I'll be quick. I'm Claire Kylie. I'm an alumni of the GSB. Spent time building in the climate mitigation and removal space for a long time and I guess you could say I've been slightly radicalized more recently um and focusing more on the adaptation and extreme risk uh side of it, which has been um you know very absent of the dialogue today. And so I'd love to talk about that a bit more. I think when you think about those climate risks, they sit upstream of food security, of migration, of economic stability, of national security, so many of the topics that this institute is here for um and preparedness for that.

Even if we take a micro example like San Francisco and Oakland Bay flooding, um in a city, an area that is very, you could say, pro-climate and wanting to support that is also still vastly underfunded because there's not an ROI. It's like a we hope this thing doesn't happen. And so we should prepare to hopefully make sure it doesn't happen. So in the spirit of um what Mayor Lurri just said around the collaboration of philanthropy and government and business, how do we help unlock that? Because right now those are two places that are very underfunded and behind in the action we need there.

I'll let I'm going to let one of you respond to this so that we can get to the last three questions. I don't know that I mean I agree with I mean adaptation I think is incritically important and um I will say that I think there are a number of co- benefits in some of the efforts at mitigation that will address adaptation. I think both need to be done pretty significantly because there is a limit to adaptation in given the climate forecast. Um and there I think probably are you know a numerous opportunities there that um are hidden and we need to be doing that work but um I'm not sure that you know we can think about this um as a zero sum. I think both things need to happen.

We could spend a lot more time on adaptation. It's not that I don't want to and I'm thinking about damage. I'm thinking about the fact frankly that often times we're not asked to um to uh address the risks until it's happened and so we are in a very reactive mode whether it's um because of a disaster like even the fires in Lahina as an example of poor adaptation planning or um frankly um in the context of tors which you know civil cases that actually put a price tag on the failure to act or the failure to adapt. So I do think we need to be doing it better. It's not zero sum and it could be looked for co- benefits for communities.

Well, we'll put uh Maxine. Thank you. So, here's what we're going to do for our Well, wait. We had another questioner. I thought we had three more. She's over here. Okay. Because what I'm going to do is have all whoever still So, you two then go ahead and both ask your questions. We'll do that old thing, right, where we get both questions out there and then people can kind of address those questions. So, let's start with you.

Thanks so much for being here. Um I'm Stefan Sajansky, a first year MBA and EIPER. Um in recent years there's been this debate between uh sort of the abundance folks and more traditional climate advocates about the need for permitting reform and you know how can we deploy at the speed we need to while still preserving our environment. Um and I just wanted to hear how sort of you folks were thinking through those tradeoffs. Right. Yeah. Okay. Great question Stefan. Hello. Thank you all for being here. I'm Maria Farhud. I'm also an MBA student.

Um I think we were talking a lot about the carbon pricing element and I'm sensing that there's skepticism about whether it actually happen or not. So I just want to confirm kind of what is the sentiment about this actually happening here in the US. And if not, if the sentiment is that it's it's unlikely, then what is then an alternative for us to think about when we want to actually put the true price of what is being sold or what is being produced on uh the products themselves? Okay, both really great questions. Yeah, I can take a crack at the first one. Um that's all right. Uh so a lot of focus on technology innovation.

Our state, my agency, we do $150 million a year of, you know, research and development grants. I think process innovation is now just as if not more important. So, we just implemented a new program. When you get solar on your roof or energy storage, uh home energy storage system, you typically would have to apply for a permit that sometimes takes 30 to 60 days. Um we've now done that so it's all automated online when we pushed out money for every county to adopt that. Um and then the state also adopted a new fasttrack permitting for large scale projects. So this garden project, the largest battery project in the world I mentioned, which is now in construction, was done through that. There's a lot more um to do in

that arena. I read abundance. I found it to be a really welcome kick in the pants to democratic governance. Uh we have to deliver on these goals and we sometimes just tie ourselves up in knots on making the perfect the enemy, the good. And you know, looking back at the Biden administration, there were so many amazing people in that administration and that IRA was such a bold policy. I really regret that we didn't get the money out faster at the end. You know, looking back from what I know now, it should have just been pushed out as block grants to the states, get the money out, and not try to check every single box because I think you end up having situations where it takes so long to fulfill those obligations, it doesn't

happen. And so, you know, unfortunately, a big chunk of the money that we'd hoped would be deployed got clawed back because of that. So, I hope that is the lesson learned for the next administration. Okay. And then pricing is the other question out there. Did you want to respond? I do. just simply because I um I found um the abundance um argument to be um helpful in the sense that certainly working in federal government coming from a public university prior to Stanford um efficiency is really important and you don't have to have a political ideological tilt for that to be really important. In fact, if you see injustice and want change, you're really

thinking about how can we do this uh quickly and with as many um positive returns as possible. So I was that sort of made sense to me. There are a lot of things that could be cut, but I actually think the diagnosis was a bit um just slightly offc center in the sense that the commitment and trust in the public good has been eroded in the United States for a very long time. Heather McGee has written this book called Some of Us, which I think does an incredible job of providing, I think, a more three-dimensional diagnosis of why we're not investing in the public good. And with that, you have an opportunity to think more broadly beyond just whether or not there are too many, you know, boxes to check or what permitting reform might look

like. What does it mean for the general public to really be committed to um you know, better public um infrastructure um whether that's education, health resources or physical infrastructure. So that I think seems really important for us to consider. Um and abundance can be this kind of mutual thriving. It's not just about more stuff, but it's about how we all kind of thrive together. Well put. and Bob I'm going to give you the last word on pricing because uh that question was a I think tailor made for you. Well I you know as an economist obviously we have to put price on carbon. If we do that then the government can step out of the way. You know the inflation reduction act I guess was the uh kind of a poster child

for putting in too many uh other things. You know has to be union labor. It has to be this, has to be that, has to be. And in the end, it didn't get done. So, just get out of the way, put a price on carbon, let business take care of it. All right. Well, thank you, Maxine, Bob, David. Uh, and before uh I ask you to give them a little round of applause. I want to put in a plug for the Stanford Initiative on Business and Environmental Sustainability. That's a uh an initiative within this institute that links the Stanford Door School of Sustainability with the Stanford Graduate School of Business. And I see my colleague Marissa Mendoza escape because this is where I always tell you to go over and tell her you were here

because we keep a database of all the alumni and students and friends of Stanford. Uh so uh she knew that was coming so she escaped. So, it's m it's mandoa stanford.edu. That's how you get into our data because we want to be able to follow up with you. And uh thank you very much for coming. Let's hear for our panelists.