Karen Harbert
President & CEO, American Gas Association
The U.S. natural gas industry is enjoying a burst of good fortune lately, with record production, a growing share of electric power markets and exports to other countries. But with increasingly dire reports of climate change, gas, like coal before it, is getting more scrutiny for its carbon and methane emissions.
 
In this episode of Columbia Energy Exchange, host Bill Loveless is joined by Karen Harbert, the President and CEO of the American Gas Association. Karen’s new to the job, having joined AGA in April after heading the U.S. Chamber of Commerce’s Global Energy Institute. Before that, she was an Assistant Secretary for Policy and International affairs at the U.S. Department of Energy under President George W. Bush and a Deputy Assistant Administrator for Latin America and the Caribbean at the U.S. Agency for International Development.
 
In the private sector, Karen worked to develop infrastructure in countries in the Middle East, Asia and Latin America. Her arrival at AGA comes as the gas industry like other energy sectors vies to establish its role in U.S. energy market amid growing concerns over climate change. Karen and Bill talked about that as well as the Green New Deal, methane, carbon taxes, carbon sequestration and more.
 

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[00:00:02]

Bill Loveless: The U.S. natural gas industry is enjoying a burst of good fortune lately with record production, a growing share of electric power markets and now export to other countries. But with increasingly dire reports of climate change, gas like coal before it is getting more scrutiny for its carbon and methane emissions. Hello and welcome to the Columbia Energy Exchange. A weekly podcast from the Center on Global Energy Policy at Columbia University. From Washington, I’m Bill Loveless. Our guest today is Karen Harbert, the President and CEO of the American Gas Association. Karen is new to the job having joined AGA in April after heading the U.S. Chamber of Commerce’s global energy institute. Before that, she was an assistant secretary for policy and international affairs at the U.S. department of energy under president George W. Bush and a deputy assistant administrator for Latin America and the Caribbean at the U.S. agency for international development. In the private sector, Karen worked to develop infrastructure in countries in the middle east, Asia and Latin America. Her arrival at AGA comes as the gas industry like other energy sectors vies to determine its role in the U.S. energy market amid growing concerns of a climate change. We talked about that as well as the green new deal, methane, carbon taxes, carbon sequestration and more during my visit to her office overlooking the U.S. capitol. And for the record, as you’ll hear I stumble once more over the name of the agency responsible for pipeline safety. The pipeline and hazardous materials safety administration. Bear with me. I’ll get it right some day. Well, here is our conversation. I hope, you enjoy it. Karen Harbert, welcome to the Columbia Energy Exchange.

[00:01:55]

Karen Harbert: Bill, it’s so great to be back with you again. Thank you.

[00:01:58]

Bill Loveless: Yeah, it’s good to see you. It’s been some time.

[00:02:00]

Karen Harbert: Well, we are gonna make up for it today.

[00:02:02]

Bill Loveless: Well, I usually like to start these conversations Karen by asking our guest, how she got started in energy. What’s your story?

[00:02:11]

Karen Harbert: Well, you know, my path is a little bit _____ [00:02:11]. I didn’t come at this as a direct line setting, I wanted to be in the energy business. It was sort of by learning on the job. I spent the beginning part of my career in the developing world working on economic development and over time, it became very clear to me that the great dividing line between developed countries and developing countries was access to energy. Because if you had electricity at night, you likely were gonna be inside studying rather than out on the streets and causing trouble. Women could go to work, industries could be creative. The health system had, you know, could keep vaccines cold, you had better water. So it was really a quality of life difference, economic difference and I found my way along to doing a big power plants in every place you’ll never go on vacation. And then found my way to apply those strategies of risk mitigation and understanding fundamentally regulatory risk, financial risk, bringing that back to the U.S. market and really dissecting. U.S. energy policy and now I find myself here at the American gas association taking a deep dive into a really important part of our energy future.

[00:03:20]

Bill Loveless: Yeah, and of course, you had stints at the U.S. department of energy, assistant secretary for policy and international affairs. I think that’s when we first met when you were doing that job.

[00:03:29]

Karen Harbert: That’s exactly right.

[00:03:29]

Bill Loveless: And then at the Chamber of Commerce in charge of their Energy Institute. Well, you know, as we sit here, we can look out and see that gas has made tremendous inroads in recent years in the United States with record production with tremendous inroads in the U.S. power sector, and of course, exports. But does that progress continue in coming years?

[00:03:55]

Karen Harbert: Well, I think it’s important to take a moment and realize how big these steps that have been made are. I think back to 2005, there wasn’t that long ago during a time of hurricanes Katrina and Rita that roared through the Gulf of Mexico and I was in charge of sort of the energy response at the time and gasoline price went up to $4.50. But we had oil and the Strategic Petroleum Reserve and we released it onto the market. Things calmed down. But as I was looking at natural gas in 2005, I had no options. I had no extra supply. There was no extra supply on the market. And we were running around the world trying to figure out what to do about it and to expedite the permitting of import infrastructure.

[00:04:35]

Bill Loveless: That’s right.

[00:04:35]

Karen Harbert: And ten years later, in 2015, you know, a couple of years ago, we were taking that import infrastructure and beginning to process of turning it around to export infrastructure. So, ten years time just a tectonic change in this industry. And to your question about does this continue? Maybe not at the same pace but it definitely continues. It’s an important part of our energy future as a clean source of energy. It’s an important part of our competitiveness, by keeping natural gas prices low, electricity prices low. It’s an important part of our trade relationship with countries around the world as we are supplying, you know, more energy to market and having them have access to alternatives, to you know, Russian gas or other gas. So, it’s like look across the United States and around the world. There is a bright future for natural gas for sure.

[00:05:22]

Bill Loveless: You point a lot of opportunities. Where do you think could be some of the obstacles to making that sort of progress?

[00:05:30]

Karen Harbert: Well, first of all, I mean, we have to continue to make the case that we can, you know, get these natural gas molecules out of the ground in a safe and environmentally sustainable manner. And the industry, the upstream industry, has been making that case in making those investments. And then we actually need to be able to move these gas molecules around the country and that’s becoming an increasing challenging to get these large, you know, pipeline projects permitted. It’s taking a long time. It’s costing a lot of money and capitol doesn’t wait so long. So, we need to have a better process to get some of these permitted and then once they get into the city gate, we need to be able to find ways to get them to homes, businesses, industries. So, the infrastructure component of this to be able to capitalize on the abundance of natural gas is hugely important and becoming somewhat onerous.

[00:06:19]

Bill Loveless: Right. Onerous.

[00:06:21]

Karen Harbert: Onerous.

[00:06:22]

Bill Loveless: Onerous.

[00:06:23]

Karen Harbert: Isn’t that a good word.

[00:06:23]

Bill Loveless: What do you mean by that?

[00:06:23]

Karen Harbert: Well, if you look at, I’ll just take a part of the country that’s not too far from where you and I are sitting which is New England. Right now, there are a number of pipeline projects that have been proposed to take gas from not too far away, Pennsylvania, Ohio, bring it through New York, supply a little bit to New York on Westchester county but go up to New England where they are dying for more natural gas. Where, you know, the depths of winters, they are having to actually use heating oil rather than natural gas because they have limited supply. So, if we could get those projects permitted, and up to New England, they would have an affordable, reliable supply of natural gas and when it’s practical, they can also backup the renewable sources up in New England. So it’s a win-win for New England but it is really difficult to get to the state of New York right now.

[00:07:09]

Bill Loveless: Well, yeah, state of New York and across, if you could look across the country to the state of Washington too which has objected and oppose some energy projects. But the opposition to these gas infrastructure projects comes from a sort of a wide swath of people. I mean, there is the environmental interests of course but there is also landowners who object in many instances. We see this in Virginia for example with a pipeline that will cross there. So, you know, I think you sort of see the opposition coming from the left or right, if you want to look at it politically. What do you about that? I mean, how do you make the case?

[00:07:40]

Karen Harbert: Well, first of, you have to make the case. And natural gas has a great story to tell on the environmental front which is we are using more natural gas today and our emissions from the sector are coming down. That’s because we are obviously, we are replacing some coal but it’s also becoming a lot more efficient and we have high technology devices that we are putting into homes and businesses that are allowing them to use natural gas more efficiently. So, as we look at the environmental footprint, if you will of natural gas, that’s a great story. And then for landowners, of course, they need to be consulted, they need to be part of the process, why there is a public and open process. And when possibly, you need to accommodate some of their concerns. But it’s all sort of education. When they realize well, if they looked underneath their feet, they might not know that there is already a lot of gas infrastructure. It’s been there a long time and it’s been used efficiently and a lot of times what these companies are proposing is hey, you know, we’d like to do, we’d like to replace this pipeline with something even safer. So, give us access. Replace this baby pipeline that have been put in place in the 40s and the 50s and replace it with something that’s more 21st century.

[00:08:46]

Bill Loveless: Well, but it’s something lacking in the part of the industry. I mean, you do have that opposition. You say, you need to make the case, you need to educate people on all. You know, has industry fallen short in making that case to the extent that you have this sort of opposition, these difficulties across the country.

[00:09:01]

Karen Harbert: Well, I think with any industry, we need to do better every day. And the great thing about about the gas utility business is they are talking, they are supplying their customers every day. So, their customers have come to understand that they are there, 24/7, 365 days a year. So, those should be our greatest champions. But it’s never done and you need to continue to work on helping people to understand the opportunities. Help them understand the risk and being authentic about it. Because there is no point in trying, you know, to convince somebody of something that must they believe that’s true. So, sure, industry can do something better every day. That’s what we do here at AGA. We want to tell that story about all the opportunities and all the positive attributes about natural gas. But to be a credible source of information, when they’ve got really good and hard questions.

[00:09:50]

Bill Loveless: We probably should remind folks too that the American Gas Association represents gas utilities, gas distributors. That’s the particular part of the overall gas industry.

[00:09:59]

Karen Harbert: That’s particular part and also those that have decided to expand their portfolios into electricity as well. So, we call those combination utilities that do both gas and electricity and making their case as well.

[00:10:13]

Bill Loveless: I want to put the education question to you in a different way. How do you build support for gas as we see a movement taking shape in the United States that wants to move away from fossil fuels including natural gas to non-greenhouse gas emission sorts of energy?

[00:10:36]

Karen Harbert: Well, first you tell the truth. And the truth is that we are not gonna change overnight into a 100% renewable economy. Secondly, you help them understand how natural gas is a part of the solution to addressing our environmental challenges, concerns, aspirations as I mentioned earlier, because we are using more natural gas, our CO2 emissions are coming down, importantly also the really bad pollutants like mercury and toxics and those things have come way, way down which has improved people’s air and people’s water. And that’s a really important thing for us in this country. So, first is you tell the truth and secondly, you build that support for what is important to different communities and different industries is that important to have reliable sources of either energy or electricity, that are 24/7 is affordability something is important. Is it is a lower income community? Is it an industry that relies a lot on energy or electricity and natural gas can be a solution for them? So, it’s about finding what’s important to the different constituencies that we are talking to and telling them how we can address their concerns or their opportunities.

[00:11:45]

Bill Loveless: You know, the reports about, we are talking about climate change and the reports on climate change have become more dire than ever it seems. Both reports from the U.S. government and from the UN and from other places and lately some big oil and gas producers, Equinor, Exxon Mobil, BP, Shell have called for a stronger response from industry including direct federal regulation of methane. Is a shift taking place in the oil and gas industry?

[00:12:27]

Karen Harbert: Well, I think this is a really important conversation at a really important time and you know, it is an opportunity for industry of all stripes and colors to step up to the table and figure out what they can do to improve their own operations. Every business, whether you’re in the energy business or the pharmaceutical business, you have an incentive to be more efficient. And so, a lot of the solutions to climate change start with more attention to energy efficiency becoming better at what we do. This industry has stepped up to the play. It’s about finding more sustainable practices. We launched the natural gas sustainability initiative which is about finding ways through all elements of our supply chain to be more sustainable and to report on those to stakeholders. So, we are very transparent about what we are doing. What we are achieving, how much further we have to go but to give ourselves some benchmarking, hold ourselves accountable and people appreciate that. And we are not gonna let up on that. So, I think the industry has a lot to bring to the table. In best practices, things that are working at small scale that can be scaled up. Because remember, this isn’t something that can be solved by one technology or one industry or frankly even one country. The solutions have to be practical, they have to be scalable and they have to be technologically ready and all of that comes back to in some way natural gas that has all that attributes.

[00:13:45]

Bill Loveless: But do you think, thinking back to folks who went to CERAWeek in Houston this year, they came back saying, there was, it was different. I mean, there was more of a discussion of climate, more concern of a climate among the oil and gas companies and much more talk among them as I mentioned about regulation of methane which, you know, the industry as a whole has objected to EPA regulation of methane. And to the need for a price on carbon, carbon tax, whatever the means, you select to do that. There seems to be some sort of a ripple going through the industry right now. I don’t know quite what to make of it. Reading something of Mark Brownstein from the environmental defense fund the other day, the organization that works with industry.

[00:13:45]

Karen Harbert: A good friend. Hi Mark, you’re listening.

[00:14:33]

Bill Loveless: He said, he told Josh Segel at the Washington Examiner that "Industry is facing a kind of competition, it never had faced before. Ten years ago, industry probably took the view that they control the situation with the transition. Now, what’s becoming clear is that they don’t have complete control of what’s going to happen." Is that a fair assessment?

[00:14:53]

Karen Harbert: Well, we certainly live in exciting times. And then environment where news is coming at us 24/7 and the louder you are, the more you’re heard which makes it complicated. I mean, let’s be honest. It is complicated and I think for, you know, our industry and the natural gas industry, we have to be cognizant of a changing regulatory environment out in the states. It’s absent, big carbon policy from the Congress, right. I mean, we are talking about, we have 50 different energy policies right now. You know, California is very different than Michigan. And they have to adapt and evolve to those changing either targets or regulations. So, for example in California, it’s moving rapidly to completely. They want to move rapidly to a much more renewable future. You know, our gas utilities that they are developing renewable natural gas. I mean, it’s natural gas that’s made from landfills, waste water, even animal waste which is important in California as an agricultural state. So, they’re all in. They are looking at what ways can they deploy technologies? What R&D investments, do they need to be making to evolve? But with the recognition that natural gas isn’t going away. We have, think about this for a minute. The natural gas utilities that we represented add a customer every minute. Every minute of every day. So, this year alone, you know, we’ve added about 250,000 new customers and we’ve put in about 6,000 miles of new pipeline. So, all of that is not gonna go away overnight and they’ve invested $10.5 billion in safety to convince that customer that they are gonna do this to the best of their ability every day. So, there has to be some sort of practical recognition that this infrastructure, it’s been in place and it’s being improved isn’t gonna go away and we need to find ways to use it for natural gas and also things are gonna come along in the future like renewable natural gas.

[00:16:46]

Bill Loveless: Right, right. Let me try, another look at the whole climate change issue and that is on the Green New Deal. You’ve been critical of the Green New Deal. A few months ago, you said, quote, I worry that some of the proponents of the green new deal have zero appreciation for what is already ongoing. They have never really been in discussion with any part of the energy industry. So, they might take some time getting educated a little bit. Have you seen any indications of doing that now? Have you been in teach with anybody from the green new deal?

[00:17:19]

Karen Harbert: Well, certainly, you know, it’s easy to stand behind podium and have a big speech about about aspirational goals that get people energized. It’s another thing to say and this is how we are going to do it. And the how doesn’t happen without the energy industry. We are the how. And so those discussions, I don’t see really happening in any real way. If they were, they are certainly, you know, not happening down the street from where we are sitting right now in congress, actually a lot.

[00:17:46]

Bill Loveless: Actually, you can see from your window here.

[00:17:48]

Karen Harbert: You can see, it’s great, it’s a blue day, it’s a blue sky day, too.

[00:17:50]

Bill Loveless: We can see the sun over there.

[00:17:53]

Karen Harbert: That’s right. So, the conversations need to happen and I think the conversation needs to happen in a different way than it is happening right now which is let’s talk about the solutions. There are some, you know, whether you are, you know, on the left or the right, whatever your position might be. Just want to talk about relitigating the problem. And I think those of us that are actually, you know, in the business of staying in business, we want to talk about the solutions and that’s where I think, you’re gonna see differences in solutions. We’re not gonna be 100% renewable in 12 years. We probably shouldn’t even try and convince people we are gonna do that because it won’t happen. So, let’s be thoughtful about this, let’s figure out how we can do it to the least cost, to the most vulnerable. Let’s see how we can develop those technology that won’t only fundamentally change our energy consumption use here but ultimately over time, the world. Let’s not forget that we are just one part of solving this puzzle and if we are able to generate both the molecules and the technologies that will help the world reduce its emissions, I started the conversation with the developing world, right. We don’t have a right to deny a lot of the world access to energy but we do have the opportunity to help them access it more cleanly and with the best available technology developed right here in America.

[00:19:09]

Bill Loveless: What do you make, we say here, we’re overlooking the capital from your office. What do you make of the discussions that are taking place today in the house and in the senate on climate change? There has been a number of hearings held over the, so far this year, particularly in the democrat controlled house. But on the senate, we’re seeing discussions too among them Senator Lamar Alexander and Senator Lisa Murkowski. You know, talk about climate change, their concerns and their belief that some sort of solutions, it could be made. And what is your view on climate change and then what’s your perception of what’s taken place over here on Capitol Hill these days.

[00:19:49]

Karen Harbert: Well, I do think, you see entrants to the conversation, if you will. There is people that had been focusing on other things that as, you know, the enthusiasm to have these discussions increases, they want to be part of it. We want to be part of making decisions, you know for the future of our country and it’s clear that there is a general acceptance that we want to reduce our emissions in this country. The question is how? And from where I sit in our proximity to the Capitol and we walk over that a whole lot. And we want to be part of those discussions, you know, there is a famous saying in Washington, if you’re not at the table, you’re on the menu. We don’t have any interest in being on the menu. And helping whether it’s lawmakers or regulators, mayors, governors, state legislatures, understand what is that toolbox look like to, you know, push that emissions curve down. You know, it’s interesting, when I tell people - and this is a true fact - I say, did you know that Houston has cleaner air than Paris, London or Rome. It’s fact, that’s an EPA generated statistic. They say, that can’t be true. So, when I go back to the question, you asked me, if people don’t know what has happened, they don’t realize how much cleaner our air is today than many places around the world. Including those in Europe that have been leading the environmental movement for quite some time. So, we should take a minute to pat ourselves on the back of what has been accomplished, understand how it’s been accomplished which is mainly through technology and environmental regulation that’s been made as part of a conversation with industry and I think that’s important. As we go forward, we’re gonna make decisions. But if you don’t have the industry that’s regulated at the table, you might make some decisions that have inconvenient consequences.

[00:21:32]

Bill Loveless: And do you feel that sense of urgency to act on climate change?

[00:21:35]

Karen Harbert: Well, I think there is different answers to that. There is one thing to have hearings in Congress which are important and they are providing that oversight and making themselves certainly a whole lot more reasoned and seasoned on the issue. There is only so many legislative days in this Congress. They have to do a lot of things. They have the debt limit. They’ve got appropriations. They got to keep the government open. And I was reminded by somebody today, I was sitting, we began the discussion on deregulating the natural gas market. And it took ten years to do it. So, there is a deliberative process put in place by our founding fathers. So, they didn’t want rash decision making. They wanted thoughtful governance and that’s what you’re seeing. We’re not gonna see a bill come out of the house and immediately passed by the Senate and went on person at Trump’s desk. You know, and the next 180 days, and the next 18 months. But the conversation which is important has begun. And therefore more solutions we brought to the table.

[00:22:30]

Bill Loveless: You know, you talked of tools. What do you think might be useful tools to address climate change? I mean, is a price on carbon one of them?

[00:22:30]

Karen Harbert: You know, I’ve made a habit in my life not to negotiate against myself. And so when some people would argue, we already have a price on carbon because 33 states have renewable fuel standard which in some indirect way is a price on carbon. Saying, you have to, you can only have this much. You can have this much renewable fuels. So, you know, price on carbon, I think there is a thousand different ways to do that. Right, some say, it has to be revenue neutral. What does that mean? Some say, well, you know what, we need to do a cap and dividend. We need to pay it back to the consumer. Well, how does that happen? We need to do that and then get rid of all environmental regulation and I’m not sure, I would see, even my friend Mark Brownstein at EDF raising his hand to say, let’s get rid of the Clean Water Act and the Clean Air Act. So, we’re at the beginning stages of it.

[00:23:21]

Bill Loveless: He, by the way, is not saying get rid of those things.

[00:23:23]

Karen Harbert: No, but that’s what, I mean, if you look at one of the proposals out there which is, you know, to cap, dividend and replace.

[00:23:32]

Bill Loveless: That’s right.

[00:23:33]

Karen Harbert: There is that proposal out there. So there are so many permutations that we are not ready to say, here is what the price needs to be and here is what it needs to be but we need to get that toolbox that I eluded to. At the end of the day, we need to make renewable sources of energy more affordable. Not today’s existing resources more expensive.

[00:23:55]

Bill Loveless: Right. I hear what you say but I guess to many of the argument goes that you need something that compels that response in terms of technology and all and that is a price on carbon, however, you do it and I agree with you, there are many ways, you can do it. But fundamentally you need the price on carbon to get there.

[00:24:08]

Karen Harbert: I was listening to, you know, you had one of your podcast. Yes, I do listen to you. And you were interviewing Vicky Hollub from Occidental Petroleum, who just made a huge acquisition. But you weren’t talking about that, you were talking about climate change and she made an excellent point which I want to underscore which is carbon capture and utilization. Some would say, also add storage on there, some wouldn’t add storage on there. You know, and the last Congress passed a very important tax incentive of 45Q for those who don’t know what it is. It basically incents you to do something with CO2. Make it, instead of a cost center, it’s an opportunity to do something and be profitable. Those are the types of creative solutions. So now, she’s taking CO2 out of the air. She’s using it in her own operations. It’s bringing down her cost and she’s delivering her product more efficiently with a lower CO2 level. Now, that makes sense. And nobody lost money. Nobody’s price went up. It all worked. So, those are the types of things with really smart people, you know, in the energy department, in the private sector, in Silicon Valley, in the VC community to really be thinking about how we can do this with 21st century tools. It’s not just, let’s take out all the fossil fuels in the system and replace it with wind and solar. You know, that sort of the kindergarten version. What we need to do is be far more sophisticated in looking for ways to deploy super cool technologies, new financial models and incentives to do this in a way that’s least disruptive and most effective.

[00:25:41]

Bill Loveless: Do you think the atmosphere in Washington these days to talk about doing the very things you just mentioned or to do more of that sort of thing or is it gonna take time? Is it gonna take new election, whatever, I mean, to get to that point?

[00:25:52]

Karen Harbert: Well, and anything. It takes time in Congress particularly when it’s a divided Congress.

[00:25:57]

Bill Loveless: Right.

[00:25:58]

Karen Harbert: But they are having discussions on both sides of the aisle. We think that’s productive. But I also think we have to take into account what’s happening in the states because in some ways, some of the states are moving faster and some are also showing what not to do, right. That in the state of Washington, when they decided, they couldn’t do the carbon tax and went back to the government and say, okay, what is palatable to our consumers. May we need to think about this. It wasn’t a one shot and done that everybody just said yeah, that’s the solution. And then there is other places in California where different discussions are happening and then you look at what’s happening in the Gulf of Mexico. They’re experiencing this huge boom in industrial, you know, we want this industrial boom to be happening in our country, so let’s be thoughtful about how we approach some of these things. So, I am certainly an optimist. I also think, we have to be realist that it is not gonna happen overnight. We are not gonna wake up and pass a law, you know in the next 18 months. But there is an important partnership between government and industry and investing those solutions that will make whatever we decide viable. And that’s the important thing. Right now, it’s about the pathways that we put in place today that will allow us to make those emission reductions later. And that includes finding ways to continue to use natural gas. New alternative sources of energy like renewable natural gas. Improving the efficiency of our systems and our delivery systems and ultimately, you know, customer use and how they are using energy more efficiently. So, I see that as a win-win and a lot of innovation there, that’s gonna be super cool.

[00:27:29]

Bill Loveless: You’ve spoken well of the Trump administration’s support for the energy industry. Over the past few years in December 2016, you told the eastern chronicle, quote, we should expect the president-elect too and shackle the energy industry. I think, you’ll see him eliminate restrictions not only the production of energy but on use of energy and stimulate investment without federal government outlays. Has he said, has he done what he said, he would do?

[00:27:54]

Karen Harbert: So, I think you’re seeing a couple of areas. First of all in access. We’ve seen more areas that the federal government controls, federal lands and waters put out for lease and industry just step up to the plate and provide some record revenue to the treasury in bidding on those leases. Now, these companies want long term views of what’s gonna be available to them. You’ve seen his administration do what they can do within their own executive powers of streamlining the permitting process to get more energy infrastructure built, so we can move not just you know, natural gas and oil around the country, renewable. Let’s not forget that we are producing a lot of wind in parts of our country that don’t need the electricity and they need to get to markets too. So we need more transmission lines being built. So, that streamlining of the permitting is really important and then they have taken a hard look at regulation of what is really needed, what are we trying to address, what is unnecessary, what is now irrelevant. And getting rid of the regulations of the 80s and being replaced by things that are relevant for the 21st century.

[00:28:55]

Bill Loveless: Yeah, and infrastructure as you mentioned is one thing that the White House has addressed squarely. The president came up with a couple of executive orders this spring that are meant to expedite the process, particularly given the resistance amongst some states to new infrastructure. Do you think those executive orders can have much impact?

[00:29:13]

Karen Harbert: I do. I mean, ultimately, he’s doing what, you know, this administration is doing within their own purview. They can’t go beyond. We would certainly love to see some legislative activity in our congress, so we can have some permanency in streamline permitting, streamlining the permitting process. But we haven’t seen that yet. If there is an infrastructure built, we are gonna push really hard for…

[00:29:37]

Bill Loveless: Infrastructure seems to be that elusive topic here in town.

[00:29:39]

Karen Harbert: That’s right. It is. But permitting could be part of that if it moves forward. So, and the other part of this conversation is what is it doing for economy and you look at it. Every one of our 50 states is benefiting from, you know, this newfound energy abundance because the supply chain, the suppliers reside in all of our 50 states. So, it does have an economic, it’s not just Texas and California and Alaska. Every one of our 50 states is benefiting from this in one way or another. So, we have to be very careful not to upset that apple cart which is constituting a lot of the investment and new jobs being created today, you know, in a growing economy.

[00:30:17]

Bill Loveless: You know, there is so much of this is, infrastructure and all is regulated by the Federal Energy Regulatory Commission. They’ve got a lot on their plates these days as they look closely at some of the way they do things like how they issue certificates for new pipeline construction. What’s working at FERC and what’s not?

[00:30:37]

Karen Harbert: Well, what we need is a full FERC. And so, you know, you have an open position with the former chairman unfortunately passed away.

[00:30:37]

Bill Loveless: Kevin McIntyre.

[00:30:49]

Karen Harbert: Yes, and you have an upcoming vacancy with his resignation. So, we’d certainly like to encourage the White House and we’ve written to the White House along with a lot of the other energy trade associations to encourage them to nominate some, so the Senate can act and get these commissioners in place, so they can make some of these decisions. And move some of these infrastructure projects forward. We’ve seen them address concerns, principally from the democratic commissioners about how to account for greenhouse gas emissions and they’ve made progress and they were able to then permit some LNG export projects that were held up because of that and I think they’ve made a good faith effort to do that. And I applaud them for doing that. It shows, some of these things when they are deliberated and then discussed in a bipartisan manner can actually advance. There might be a lesson for Congress.

[00:30:52]

Bill Loveless: Well, it’s done on the Democratic side of the commission. You still feel, they are not going far enough in terms of considering climate change and deciding on projects.

[00:31:48]

Karen Harbert: Well, I think that will continue and that’s why they have made some progress but they haven’t green-lighted everything. While they are tempting to understand different concerns, what do they have within their authorities to address those and some they don’t have the authority to do it and they have to be forthright about that which is, it’s an interesting concern but that’s not within the purview of the fellow energy regulatory commission. But I think they have made good faith progress and we hope they continue to do that.

[00:32:15]

Bill Loveless: You know, one issue, I know is important to you is pipeline safety. It’s been something AGA has been addressing recently. You know, we’ve seen the headlines over the past year so of deadly explosions and distribution systems and North of Boston and North Carolina for example. It happens. It may not happen often but it does happen. I know, it’s a concern of yours. What more can be done to improve that sort of safety.

[00:32:41]

Karen Harbert: Sure. And by the way, let me just say, you know, one incident is too many. But you’re right, sometimes they do happen and we have to learn from every single one of them and I think we do. AGA immediately addressed the two concerns put out by the national transportation safety board about some of the problems that we saw in Massachusetts and we’re not industry worried about what they could do to address those. So, it’s stepping up to the plate when you need to. As we look to the rest of this Congress, we have to do a pipeline reauthorization bill and that’s all about safety. And we’ve learnt a lot. We’re at the table on this one. We are not on the menu. We are strong partners with our regulator PHMSA. That’s over the Department of Transportation. We want a great piece of legislation.

[00:33:28]

Bill Loveless: By the way, did we say what PHMSA is the Pipeline Hazardous and Safety Materials Administration.

[00:33:33]

Karen Harbert: Agency, yes, you got that one, all right. So, what we want is a bill that continues to allow our industry to replace pipelines. Right now, they have, I said, this year alone, billion dollars of investment in the ground, 6000 miles of pipeline. We don’t want anything that slows that down or causes companies to pause because they are not sure what the regulations might be. We also want to make sure that, you know, people understand regulators understand, legislators understand that different parts of the country are different. And different utilities are different. So one size fits all. If you’re looking at, you know, how we distribute this in the northeast versus how we do it in Texas, things are a little bit different. So, finding ways for it to be an open process that recognizes differences. But most importantly, we want to make sure that there is not things in the safety reauthorization that are counterproductive. You know, as an example, there is an idea that we might need a certified professional engineer at every point in the process to certify something. And that sounds good on the surface except for the fact that, that might not be the most capable person in the room to actually certify that. Maybe we need somebody that’s been on the job ten years, not somebody that’s straight out of college with a certified, you know, being a certified inspector. So, we have been up on Capitol Hill. We’ve looked at the legislation. The administration is about to come out with theirs and we intend to be good and faithful partners in trying to get this to closure, so that we can have some certainty going forward.

[00:35:01]

Bill Loveless: So, it probably is a matter of trust, isn’t it? And when you talk to these inspectors and who should be doing the inspections, I’m thinking to the offshore oil and gas industry and there is, you know the Obama Administration put in place stiff regulations after the Deep Water Horizon explosion in 2010. And Trump administration has eased some of them. Each side has its reasons for doing that, what they did but for many, I guess who watched this critically, it’s a question of trust. I mean, how much trust can you put in the people who are gonna do the inspection. Some would say, well, you know, if the industry has the prerogative by large then, you know, are they gonna lean towards the industries? Stated position on it that and you know, and others, people in the industry would say, we know best who should be doing those sorts of inspections. I mean, how do you reliably, incredibly, I guess that’s the word I’m looking for incredibly make that case so people feel comfortable with it.

[00:35:54]

Karen Harbert: Well, it’s an excellent question and one that we are gonna be working on through the remainder of this year because we want to find the right solution not the easy solution and sometimes the easiest ones seems to be the right one when it’s really not. And that point in case on the professional engineers one where it sounds good but in practice it might lead to some unfortunate consequences. So, our job is to educate and get up there and say, we get what you’re going after. Here is my be a better way of going at it. Why don’t we do this instead and let’s look at the track record of at this part of the industry, if we applied that kind of practice what does it look like. So, it is a matter of education sort of where you started this discussion. But the other point is we have a lot of data and we accumulate a lot of data. We distribute a lot of data. So, we are not, you know, making things up. We’ve got a lot of things to produce in the process of creating legislation and regulation that’s based in sound data and we’ll bring that to the table.

[00:36:51]

Bill Loveless: Well, Karen, Harbert, thank you for sitting down with us today on the Columbia Energy Exchange.

[00:36:55]

Karen Harbert: Thanks Bill. Great to be with you.

[00:36:58]

Bill Loveless: Well, that’s our conversation. I hope you enjoyed it. For more on Columbia Energy Exchange and the Center on Global Energy Policy, go to our webpage at Energypolicy.columbia.edu and follow us on social media at ColumbiaUEnergy. For Columbia Energy Exchange, I’m Bill Loveless. We’ll be back again next week with another conversation.